An analysis of the mess we are in

I think Rush Limbaugh described it best.  People are voting for Santa Claus.  There are now more people dependent on the government than those supporting it.

So here are the categories of the dependents:
1.  The Destitute.  These are people utterly dependent on the government who would be dead within 2 months if their government dole was cut off.  These people receive TANF, Food Stamps, welfare, Section 8 housing, tax credits, Medicaid, disaster relief and other government aid.  There are now 47 million people on food stamps, and 62 million receiving Medicaid as of 2009.  This class of people did not exist until 1964 until Johnson introduced his War on Poverty.  The exact number of these people is unknown because there are multiple overlacking programs.  The question of race is an undertone here, but it should be noted that only 22% of food stamp recipients are black.
2.  The Entitled.  These are people who cannot be considered destitute, but receive government assistance, and generally feel like they "earn it".  These are people receive Social Security, Medicare, and tax credits.
3.  The Providers.  These are generally middle-class people who provide services to the Destitute and the Entitled and have an interest in seeing the numbers rise.  This includes landlords (who receive Section 8 payments), and workers at grocery stores, liquor stores, nursing homes and medical facilities.  A large proportion of health care costs (say 50%) are paid to providers.  This would also include government bureaucrats who oversee the process.
4. The Military-Industrial Subcomplex.  There are about 1.1 million military members on active duty, and about 22 million veterans.  In addition, there are numerous civilians who are employed by the military and the VA. Add it government subcontractors. 

What is the dollar amount of these categories?  While this can only be a very rough guess, and there is some overlap, these are approximate numbers:
1. HHS & DoA = $1023 bn.
2. SSA = $829bn
4. DoD & VA = $817bn.
Category 3 - Providers is not split out separately, because they receive money from these other sources. 
These total $2669bn, a very large percentage (about 75%) of total government outlays.

A quick and dirty analysis of the situation indicates that these numbers all need to be cut by 1/3 to 1/2, which would mostly fix the deficit problem but which would cause other social problems (riots?).  This becomes unthinkable.  Is now the time to do the cuts?

I guess the bigger question, which I perpetually ask is, how long can this situation (having trillion dollar deficits) go on?  The US is very fortunate in being the world reserve currency, and the world has an appetite for Treasury bonds. It would be fair to say that the financial system is subsidizing our social-welfare system. The interest rate on 30 year bonds is about 2.9%.  (I think a fair interest rate of 30 year bonds would be about 5% but I digress).

So the short answer, is that there is no problem at the moment.  As long as the 30 year bonds are below about 4%, then they are cheap and the government should take advantage of the situation.  So, logic says, kick the can down the road for a few years and see where we are then.  How about raising the debt ceiling to exactly $20 trillion, and agree that it will not be raised again until we have a new president in 2017?