Begin a thought process with me. Let's just look at medicare and medicaid. In 2010, the US government spent $793 billion on these programs. There is a lot more than medicare and medicaid to welfare, but let's just look at this. Now, imagine that instead of the government taking that money from business and people and giving it away that the money instead was left in the hands of those to whom it belongs. What then?
First and foremost, to be sure, many people would be left without health insurance. Even as the extremist libertarian that I am, I can admit that this is a bad thing. All other things being equal, people having health insurance is much better than them not having health insurance. Fortunately for libertarians, though, all other things are not equal in this case. We have to remember that money. What does this other money do? What is its purpose?
The extra money will either be spent or invested. The spent money increases profit margins and the increased investment provides the capital with which to furnish new jobs. So the people who have lost health insurance can now find new jobs because of that capital now being freed up.
But is this alternate scenario worthwhile? Is it better that the money is providing jobs instead of just directly going to pay for health insurance? From the point of view of the person who was taxed, the situation is much better, because now he is getting more for his money. From the point of view of the person who was getting the health insurance, he is now getting the money for insurance plus some spending money for himself. His situation is improved because of the change.
Yes, it is a simplistic analysis, but what do you think of it? Is this a worthwhile idea?