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Rethinking the Welfare State

May 21, 2007

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.

www.townhall.com/columnists/GeorgeWill/2007/05/20/sarkozys_task

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10 Responses to Rethinking the Welfare State

  • Bill,
    No disagreement here, but all countries need some kind of safety net to support the genuinely poor and disadvantaged. Without that you get the disgraceful and widespread poverty that exists in the USA, despite the fact that it is the wealthiest nation on earth.

    I find it ironic that you are such a staunch supporter of rampant capitalism when you and your colleagues in the religion industry contribute nothing useful to the economy and survive only by begging for money from more productive people. There’s not much difference between that and state-sponsored welfare. The basic problem is that some people in society are simply not productive, and it is a harsh judgment to demonise them all as lazy when some are genuinely incapable of economic productivity, either temporarily or permanently.

    Steve Angelino, WA

  • Thanks Steve

    Yes I agree that there is a place for safety nets, etc.

    But you have me lost on your puzzling remarks about the ‘religion industry’. Just where and when have I been begging for money? The Australian government has never complained about the taxes I pay each year.

    And for what it is worth, while I generally support the free market, I have been critical of many aspects of “rampant capitalism” as you put it in various posts on this site, if you would care to read further.

    Finally, I nowhere in this article demonise all people as being lazy. We must always distinguish between the deserving and undeserving poor: between those who can’t work and those who won’t work, etc.

    Bill Muehlenberg, CultureWatch

  • Angelino:

    The poor are the ones hurt by the policies of those who promote the politics of guilty and pity.

    The poor in the US would be much better off had welfare never become so popular and widespread, since the family is the key to upwards mobility.

    The ultimate beneficiaries in public expenditure for welfare are not necessarily the intended recipients but the bureaucrats who administer it.

    As Dr Nancy Pearcey points out:

    “Though welfare had done some good for those who needed only a temporary boost to get back on the feet, it had also created a permanent underclass – the chronically poor, whose poverty was related to social pathologies such as alcohol addiction, drug abuse, fatherless homes, and crime…

    In fact, government aid can actually make things worse. By handing out welfare checks impersonally to all who qualify, without addressing the underlying behavioural problems, the government in essence ‘rewards’ antisocial and dysfunctional patterns. And any behaviour the government rewards will generally tend to increase.

    As one perceptive nineteenth century critic noted, government assistance is a ‘might solvent to sunder the ties of kinship, to quench the affections of family, to suppress in the poor themselves the instinct of self-reliance and self-respect – to convert them into paupers”.

    Augusto Zimmermann

  • Steve Angelino 21.5.07 / 5pm wrote

    Bill,
    No disagreement here, but all countries need some kind of safety net to support the genuinely poor and disadvantaged. Without that you get the disgraceful and widespread poverty that exists in the USA, despite the fact that it is the wealthiest nation on earth.

    Steve, your assertion is contradicted by the facts. The USA has a huge bureaucracy devoted to providing a safety net.

    Just today I saw a headline to the effect that “After more than 40 years of the War on Poverty in the USA, it’s time to recognise that poverty has won.” Drat, can’t find the source now!

    A most instructive book on this point is “Bringing In The Sheaves” by George Grant – a pastor at the pointy end of social problems, who started searching for answers when he failed to talk one of his parishioners out of jumping off a bridge to his death.

    The conclusion of his book and a number of others (eg. Dr Nancy Pearcey quoted above) is that government handouts cause poverty, by creating a “poor underclass” of people who become so dependent upon handouts that they lose the will to work, even whilst they theoretically retain the physical or mental ability to work.

    And to go further into this theme, your time would be well repaid by reading “Paradise Restored” and “Productive Christians in an Age of Guilt-Manipulators” both by the late Dr David Chilton. The second is a potent rebuttal of the Christian socialist views espoused by Ronald Sider in “Rich Christians in an Age of Hunger.”

    As Bill said, yes a safety net is useful, but the government is not the institution to operate it, because as a body, the bureaucracy cannot distinguish between the deserving and undeserving poor (well, not without the mountain of evidence demanded, the assumption of distrust and the massive red tape required to check everything).

    That demands spiritual discernment, which is why the Bible puts welfare into the care of the Church and the family, and puts it into a very personal context.

    John Angelico

  • Thanks guys
    Another great book is Myron Magnet’s 1993 volume, The Dream and the Nightmare: The Sixties’ Legacy to the Underclass. For the scene in Britain, see James Bartholomew’s The Welfare State We’re In (1980, revised, 2006).
    Bill Muehlenberg, CultureWatch

  • It’s hard to improve on Theodore Dalrymple’s Life at the Bottom: The Worldview That Makes the Underclass (2001). Dalrymple is a British doctor who has worked in the prison and welfare system in several countries.

    He points out that most of the poor people in the West are actually better off materially than medieval dukes. But too many have a poverty of the soul that comes from the worldview of the (pseudo-)intellectual Left.

    One is the idea that humans don’t really have free choice, but are the result of circumstances. Dalrymple exposes the inconsistency of the Left with great wit and sound information. E.g. one patient claimed that he couldn’t help being violent to his girlfriend. But Dalrymple pointed out that he had been a model non-violent prisoner. Reply: I couldn’t get away with violence because the guards would beat me up. So he could control his violence after all! And of course, the crims would not excuse police brutality by their upbringing, hard day at work, etc.

    Many of his patients have real purpose in their lives, which are full of violence and promiscuity.

    Jonathan Sarfati, Brisbane

  • Bill,
    There is letter from you on the ACL site on 10-Jan-2006 where you beg for money to support your new Ministry. I’m pleased to hear that you pay income tax, but many religious organisations don’t, and are therefore subsidised by taxpayers.

    And there is certainly no doubt that there is a thriving “religion industry” in this country, but more particularly in the USA. They even have trade shows and marketing seminars, as was shown on Andrew Denton’s program last night.

    My point about the US welfare system is that it is extremely harsh compared with other Western countries like Australia. Poverty in the US is more obvious and more common than in other developed nations with more generous welfare programs. I think it is difficult to draw the conclusion that welfare causes poverty.

    Steve Angelino, WA

  • Thanks Steve
    But I was not ‘begging’ for anything on the ACL site. And the documentation provided in the books mentioned in this thread makes it pretty clear that the Welfare Stare does contribute to poverty, and does result in a permanent underclass.
    Bill Muehlenberg, CultureWatch

  • Steve, I would reckon most religious organisations such as churches are not for profit. The money left over after paying the bills and the minister finds its way to charity. Would you like charities to receive less? For that is what inevitably would happen if taxes were levied on religious organisations.
    Matthew Mulvaney

  • For many years I have been with a so called “religious institution involved with the military.
    The Army actually admitted that we contributed something like $20 million dollars of value to the Defence Forces and for which they actually returned by way of support som $150,000.
    The reason that Government subsidises so many religious organisations is that they do not have the funds available to pay for the services offered.
    Without voluntary groups the welfare society would collapse, this situation was recognised by the govenment in their “Year of Volunteers” a few years ago.
    I actually received a certificate for the recognition of 10 years service to the community, not a bad profit margin.
    I can assure you that the religious organisations are not doing their work for any other gain than the satisfaction one gains from extending the hand of service to people of the community.
    Jim Sturla

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