Walter Williams had an article a couple weeks ago that had a couple remarkable points:

In 2005, total federal, state and local government expenditures on 85 welfare programs were $620 billion. That’s larger than national defense ($495 billion) or public education ($472 billion). The 2005 official poverty count was 37 million persons. That means welfare expenditures per poor person were $16,750, or $67,000 for a poor family of four.

Williams points out that this understates the income of the poor because it doesn’t list any private charity they get nor does it least non-poverty programs such as Social inSecurity.  Also we’d like to think that many of those counted to be “living in poverty” do have jobs or some kind of income. 

Anyone claiming that the working public needs to do more to “help the poor” is just plain wrong.  We’re spending far too much money that’s more often than not counterproductive rather than helpful.  That leads to the second remarkable point:

The disincentive effects of Social Security have reduced the GDP by 10 percent, the federal income tax (as opposed to a proportional tax) by 9 percent and past deficits by 3.5 percent for a total of 22.5 percent. He guesses that welfare programs have reduced GDP by 2.5 percent. The overall effect of redistributionist policies has created incentives that have reduced GDP by a total of 25 percent. Without those, our GDP would be close to $18 trillion instead of $14 trillion.

So in addition to the money that is being stolen from your check you are making (on average) 25% less than you otherwise would.  I haven’t read the work that Williams is referring to and can’t evaluate his reasoning.  On the other hand I am sure that government is costing us a lot in productivity.  First of all you have people who are being paid to sit around watching Oprah at home.  Then you have the people in government that aren’t producing anything of value (besides enabling Oprah’s viewers.) Then you have government workers that actually get in the way of productive working people with needless regulations and reports that they require.  Finally those that are paying for all of this have a disincentive to support everything so they wind up throwing in the towel and enjoying a longer if less affluent retirement.

All of this has a cumulative and multiplicative effect so I wouldn’t doubt that the 25% estimate of lost productivity is low. 

Government isn’t the solution, it is the problem.