Ultimately it is still the struggle of Federal versus State. Colonial Americans choose and created states that represented their political or religious preferences. I believe citizens should be governed on issues of daily living at the state level. The federal government should be responsible for National Security, inter-state commerce, and policy oversight on the constitutionality of issues. Citizens can then choose the state they want to live in based on those state's ethical/religious policies, tax schedules, and governing principals. Taxes should favor more use taxes. Charge the people that use the services. More toll roads to fund roads, more fees in parks, libraries, and athletics. This will encourage states to be fiscally responsible to keep these fees manageable.
How can this be done and not drive us into debt or dependency?
"Teach a person to fish and you feed them for a lifetime" Dependency on government helps breed more dependency. People need and want to be taught independence. Just like violating a law leads to loss of autonomy, there should be similar recourses with government assistance.
FOOD STAMPS: This should not be free for all shopping. Proper food choices can be dictated. Approved foods from a food list created by nutritionist will only be covered. This will help drive proper food choices and healthier lifestyles. Food supply companies can then negotiate prices to be the preferred vendor for the approved food items. This can easily be accomplished with the bar code system already in place.
GOVERNMENT ASSISTANCE: Those and their non-school aged children on assistance not working or disabled will be picked up by school buses and taken to a "Job Center." These can be vacant municipal buildings. There they will be taught a life skill; childcare (the children coming with the parents), cooking (preparing the meals for all at the job center), auto repair (learning to service municipal vehicles and buses), landscape (maintaining municipal grounds and parks), carpentry ( working on public housing repairs, see below). They will learn skills that will allow them to enter the work force. Municipal workers will still be necessary to serve as instructors and supervisors.
PUBLIC HOUSING: Those receiving a housing benefit will be subject to a housing inspection once a year. Damages (not normal wear and tear) will be documented and slated for repair. The repairs will be done by the occupant and the carpentry crew from the Job Center.
REPRODUCTION: This will be controversial; however, we currently restrict driving to those with a license and school attendance with immunization status. Having a child that you cannot provide basic life needs for and need the assistance of the state should require mandatory contraception. Your entitlement benefit will be tied to your birth control status provided at the public health department. Once you and your dependent are independent of government assistance, restrictions would be lifted. People need to learn responsible reproduction before they doom their offsprings to a similar fate.