That was not the middle class. The people you speak of were in the top 1% of society, or maybe even higher. You’re comparing the richest class of 100 years ago to the very poorest of today. And even then, 100 years ago there were no automatic washers, dishwashers, painless dentistry, and a whole host of other things that we take for granted today, but which even the rich didn’t have 100 years ago.
As for people sleeping in the streets - you can’t help people who don’t wish or don’t seek help. You can not blame government programs for the state of people who choose not to use those programs. Most of the people who are homeless today are homeless through choice, through ignorance, or mental incapacity.
We even have the kind of people you’re talking about in Canada, and quite a lot of them, despite the fact that our social safety net is probably twice as magnanimous as the U.S.'s. Some people blow their welfare cheques on cigarettes and drugs, and get evicted from their homes. Some just can’t get their act together enough to apply for assistance. Some don’t have enough faculties to understand what’s available to them. That may be sad, but such people have existed through history, and I’m not sure you can claim it as a failure of government or markets. They are just the poor souls who slip through the cracks.
But even so, when those people get sick, they are still given medical care that society could have never afforded 100 years ago, even if it had the knowledge.
Pantom: The fundamental difference which prevents the government from creating wealth is that everything it does, it does with taxed money. That destroys wealth creation somewhere else. By preventing capital from flowing where it ‘wants’ to go, it introduces inefficiency and stifles growth.
Certainly things like police forces and road systems are enablers of wealth creation, and even libertarians generally support those functions of government. But when government ‘creates jobs’ by taxing the people and then spending money on public works projects (or even worse, taxing people to subsidize business in politically powerful constituencies), all its doing is destroying jobs in a widespread fashion that is hard to measure, and making other jobs in concentrated areas politicians can point to and say, “Look at those jobs we made!”
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