The welfare state arose just after the second World War and has been a dominant – and growing – feature of the West ever since. Many criticisms have been levelled against the welfare state over the years. The main concerns have been about economic stagnation and decline, addiction to state largesse and entitlements, disincentives to work, the undermining of personal responsibility, ever increasing powers given to the state, the breakdown of family and community, bloated bureaucracies, the collapse of the work ethic, and welfare dependency. Other problems can be mentioned.
But the longer Western welfare states have gone on, the more apparent the inherent shortcomings of the system have become. One good example of the inefficient welfare state has been France. The poorly performing nation has been discussed by many, and its welfarism is no small reason why the French decided for something new in the election of Sarkozy. He has promised to make economic and political changes, and a majority of the French have decided to give him a go.
George Will provides some reasons why the French welfare state urgently needed reform, and why newly elected president Sarkozy has a big job on his hands (townhall.com, May 20, 2007). A few quick figures set the stage: “France’s unemployment rate is 8.7 percent, nearly double the U.S. rate of 4.5 percent. Among persons under age 25, a cohort that supported Royal, the rate is 21.2 percent.”
But pure economic concerns are not the only problem of the welfare state. Many have noted the cultural contradictions of capitalism in general, and welfarism in particular. Of course the 1976 book by Daniel Bell comes to mind here. Will offers a nice summary of its main thesis:
“Capitalism flourishes because of virtues that its flourishing undermines. Its success requires thrift, industriousness and deferral of gratifications, but that success produces abundance, expanding leisure and the emancipation of appetites, all of which weaken capitalism’s moral prerequisites. The cultural contradictions of welfare states are comparable. Such states presuppose economic dynamism sufficient to generate investments, job-creation, corporate profits and individuals’ incomes from which come tax revenues needed to fund entitlements. But welfare states produce in citizens an entitlement mentality and a low pain threshold. That mentality inflames appetites for more entitlements, broadly construed to include all government benefits and protections that contribute to welfare understood as material well-being, enhanced security and enlarged leisure.”
He continues, “The low pain threshold causes a ruinous flinch from the rigors, insecurities, uncertainties and dislocations inherent in the creative destruction of dynamic capitalism. The flinch takes the form of protectionism, regulations and other government-imposed inefficiencies that impede the economic growth that the welfare state requires. So welfare states are, paradoxically, both enervating and energizing – and infantilizing. They are enervating because they foster dependency; they are energizing because they aggravate an aggressive (think of burning Peugeots) sense of entitlement; they are infantilizing because it is infantile to will an end without willing the means to that end, and people who desire welfare states increasingly desire relief from the rigors necessary to finance them.”
And what about France? Last century former President Francois Mitterrand “promised stimulative spending through expanded entitlements, a short workweek with no reduced compensation, job-creation through public spending, and higher taxes on the investing classes. So productivity fell and unemployment – it has not been below 8 percent since 1981 – rose. Statism, the inevitable concomitant of government attempts to administer France’s three ideological incompatibles (‘liberty, equality, fraternity’), continued. And 47 percent of the French electorate just voted for Royal’s promise of much more of it, even though France’s 2006 growth rate was lower than that of 21 of the (then) 25 members of the European Union.”
So what does Sarkozy propose to do about all this? He “wants to lower taxes, including inheritance taxes, and eliminate the tax on overtime work. That tax, along with government snoops patrolling companies’ parking lots to detect antisocial industriousness, enforces the 35-hour workweek. He wants to do what Margaret Thatcher did after she was elected in 1979 because Britain was weary of being governed less by parliament than by unions. Even before Sarkozy was elected, public sector unions – government organized to pressure itself to fatten itself – threatened a paralyzing national strike because he opposes allowing 500,000 employees of government-controlled companies to retire earlier than private sector employees, and with larger pensions.”
Concludes Will, “During the 25 years that the French left and some right-wing nationalists have spent reviling ‘cold, heartless impoverishing Anglo-American capitalism,’ France’s per capita GDP has slumped from seventh in the world to 17th. Sarkozy’s task is to persuade the French that their government’s solicitousness on behalf of their security and leisure explains the work they must now do to reduce their insecurity.”
Of course since being elected, over a thousand cars have been torched in France by leftists and welfare state addicts. Getting off welfare dependency is about as hard as getting off cocaine or heroin. Once smitten by government handouts and personal irresponsibility, the welfarist addiction is hard to kick. Thus Sarkozy has a real job on his hands. More cars will undoubtedly burn. But France needs such reforms, as painful as they may be – and the sooner the better.