I can't give you a specific reference but I understand (I think from an Economist of about three months ago)`that state expenditure in Sweden has been hauled down fom 60% of GDP to 50% and this is still considered too high to be comfortable. The beauty of a country like Sweden is that its population is small enough that ideas/policies can be intensively discussed. There's an esprit de corps which is lacking in larger countries. I don't think it has much to do with being a welfare state per se. A welfare state in Sweden will always be better/more efficient than a welfare state in England.
Keith Hudson
At 17:56 12/06/2003 +0200, you wrote:
I will support Ray Harrell. Sweden is not at all dismantling its wellfare state. And it works very well in many ways. I read last wednesday (yesterday) that the German businessmagazin "Wirtschaftswoche" in cooperation with researchers from "Empirica Delasasse" has ranked 214 European regions, all of EU + Swiss and Norway, according to innovation, industrial strength etc., and the overall strongest of all European regions is the Stockholm region. A wellfare state can produce a strong society!!
And the primary schools in Sweden are among the very best i the World, much better than both in Norway and England, according to a new international report that I recently saw, and it is not private schools. All children in Sweden learn til read and write and all the other stuff etc. And one important reason to this is that Sweden spends a very large lot of money on schools. The wellfare state works if it is properly funded. What happens in England is that funding is lacking, and then the politicians say that it does not work - it is of no use - it is just a waste of money. And it gets worse. But it does not have to be that way. The primary schools in Sweden works very well, and they cost a lot of money. It happens one gets what one pays for!!
- ----- Original Message -----
- From: Ray Evans Harrell
- To: Keith Hudson
- Cc: [EMAIL PROTECTED]
- Sent: Thursday, June 12, 2003 4:07 PM
- Subject: [Futurework] Re: Retreating welfare state (was: A conservative Christian economists view of Social Security)
- I don't know about that Keith,
- The one thing we can say is that the Communists in a perpetual war with the West were not able to do it at home. Who knows what would have happened if they had tended to their own people instead of being so evangelical. The same problem with the churches here. They are being run ragged with the policies of outreach that fail to minister to the needs of their own congregations. You should go on the Music Ministry lists and listen to the decline in graded choirs for example. That's your constituency. And I don't see where private enterprise has done jack sh... when it comes to the "music of the spheres" here in a huge market with weekly performances. They have to keep running back to their manual because they aren't doing much thinking about home for themselves. . Eventually it will all break down, because at its heart even their manual doesn't support them in their economics. Also, the Americans' who have immigrated to Germany to work in the Arts speak of it being a heaven while here is a hell. They aren't immigrating, I might add, to England either in spite of your 14 orchestras in London. Do you have labor laws that keep our instrumentalists and the Russians out? We have absorbed a body blow here from the very institutions that the American propaganda machine demeaned, the old Communist arts system. They have flooded our market with superb musicians, superbly trained and have driven down an already low standard of living that is only lower in Capitalist Russia today. And finally, why are all of those people marching in France and what about the articles that Tor Forde keeps sending from Norway and we don't have any Chinese, Swedes or Danes on this list. I deal with them in my business and they aren't crying the same tears you and I talk about all the time. So maybe the issue is cultural. Maybe Soros is right. Or maybe you are a fundamentalist after all?
- REH
- ----- Original Message -----
- From: Keith Hudson
- To: Ray Evans Harrell
- Cc: [EMAIL PROTECTED]
- Sent: Thursday, June 12, 2003 2:34 AM
- Subject: Retreating welfare state (was: A conservative Christian economists view of Social Security)
- Ray,
- I am very far from being a member of Terrell's constituency but I think he has a stronger case than you care to admit. It should be more than apparent now than the welfare state in developed countries does not diminish poverty or degradation -- and is a very expensive way of not doing so also!
- The welfare state in the developed countries can only exist now by the assent of the non-poor who vote in elections, so those people have to be bribed, albeit very subtlely. Over my lifetime there have been more and more ways in which the middle class receive more subsidies and state help than the poor, whatever complexion of government is in power. However, as the burden of taxation grows then the bribes have necessarily become less subtle in order that more of the voters are included in the net.
- However, as in Soviet Russia, there's a limit to how much the state can tax and redistribute without the whole country falling into a state of demoralisation. (Of course, I realise that the USSR didn't have a formal taxation system -- redistribution was done in other ways.) Even in the arch-welfare states, such as Sweden, they are cutting back on taxation and welfare redistribution as quickly as they know how. We are probably reaching the limits of taxation now in developed countries (as the condition of France and Germany well testifies) and the only way that a right-wing government in America and a left-wing government in England can maintain the system is by bribing the middle class.Terrell has a very telling sentence in his article:
- <<<<
- Cutting benefits will succeed politically only if a large number are "grandfathered" into the current benefits setup.
- >>>>
- . . . which is exactly what is happening. I don't know the figures for America, but the latest dodge in England is that a middle-class family earning up to 75,000 pounds per year (US$120,000 -- a very adequate income you'll admit) is receiving family credits! I doubt whether the state system (and, remember that there is a large state-employed lobby whatever political party is nominally in control) can get away with much more, and I think there will have to be a retreat fairly soon. Some recourse to Terrell-type nostrums will have to take place. It will probably produce more problems than we have now but it will at least be affordable.
- Keith Hudson
- At 00:21 12/06/2003 -0400, you wrote:
- Since we don't have conservative Christian economists on this list. I think it is a liberal thing to do to be sure that we read a few of the people who Bush listens to. This man says he didn't vote for Bush. I suspect Bush is too liberal for him. I invited him to the list but he declined not very respectfully. But I think his view is important to know and answer. I'm sure that Kutlow and Kramer on MSNBC agree with the gist of what he says although they probably are not of his faith or rationalization. Both claim to have the ear of the White House.
- REH
- Social Security and the Family
- Timothy D. Terrell
- April 4, 2003
- Families in our society are fragmented in ways that would have been difficult to comprehend centuries ago. This is all the more strange because we are better able than any of our ancestors to communicate and meet with family members. The market economy has produced a wide variety of machines that allow us to speak with and see people across thousands of miles, and travel distances in a few hours that would once have taken weeks. With this capacity to keep in touch with family members, why is it that we have a greater disregard for family connections than did previous generations?
- Perhaps one reason is that we are less dependent on one another than in times past. Before the state began to provide welfare in its various forms, unemployment insurance, and Social Security, the family and the church were the primary sources of assistance for an individual suffering hardship. The family would properly be the first resort when individual resources were exhausted (I Timothy 5:8, 16). Thus, the individual who neglected family obligations, was quarrelsome, or isolated himself geographically from the family became exposed to greater risk.
- The wider availability of insurance has increased the ability of the individual to purchase protection from some hazards. Yet even when insurance can alleviate some risks, there are serious eventualities that would cause an isolated individual or small family to suffer immensely if the family or church does not step in. Insurance arrangements are better suited for those events that are unlikely, expensive, and are not substantially influenced by the insured's own behavior. Insurance is not for events that are likely. For example, aging, and a decline in the ability to earn income, is a likely event in the lives of most people. Saving is better preparation for retirement than insurance. In the event that catastrophic loss destroys savings, or higher-than-expected expenses mean that the savings are inadequate, the family or church may be called upon for help.
- Social Security is a poor substitute for this kind of old-age "safety net," in addition to whatever we might be able to say about its being beyond the legitimate scope of the civil government. First, Social Security is a wealth transfer scheme and not a savings plan or a charity. Money paid into the system goes to fund the benefits of current Social Security recipients, and not into actual savings accessible only by the contributor. Payments do not stop when the total amount received comes to more than the person paid in over their lifetime, plus any reasonable rate of interest. Instead, the payments continue, courtesy of those still working (who have no say in whether they pay in to the system or not).
- Second, Social Security does not allow for the use of discretion in relief of the impoverished. Yet the Bible requires us to use discretion in deciding whether to provide assistance, how much assistance to provide, and the nature of the assistance (e.g., I Timothy 5:3-16).
- Third, Social Security does not allow unused benefits to be retained and passed on to heirs as an inheritance. In contrast, family funds allocated to the support of an elderly family member would remain in the control of the family if the supported individual should not live as long as expected.
- Fourth, Social Security is poor stewardship of the resources used to fund the system. Because it is a wealth transfer scheme instead of actual savings, the money going into the system is not being invested in the economy. The economy's rate of growth is substantially slowed by Social Security, as several economic studies have shown.
- Finally, Social Security eliminates some of the economic benefits that come from having large families. William Mattox, Jr., writing in USA Today (July 6, 1999), notes Allan Carlson's argument that today's smaller families may be related to Social Security:
- [I]t's funny how "maybe one" advocates never get around to complaining about the fact that their Social Security benefits will be largely financed by other people's children. Indeed, Allan Carlson, president of the Howard Center for Family, Religion and Society, points out that government old-age programs tend to disrupt the natural economic incentive for adults to invest themselves in child rearing.
- Carlson says that if Social Security did not rob Peter to pay Paul, Americans would be more apt to appreciate the long-term social-insurance value of raising children. And Americans would be more apt to question various economic projections about how ridiculously "expensive" child rearing is today.
- From: Ray Evans Harrell
The church is a backup for the family when the family cannot provide for its own needy (again, see I Timothy 5:16). Yet the family should be the first recourse when disaster strikes. Social Security bypasses the church, and makes the church and the family unit less economically relevant, and therefore less effective.
How, then can our society move toward a more family- and church-oriented system of economic dependencies, and away from our current dependency on the state? The first step will be a renewed recognition of the mutual responsibilities family members and church members have toward one another, and a preparation to meet those needs. Families should save not only for vacations, houses, education, and retirement, but for emergencies beyond the immediate family. Churches should become sources of practical assistance, and not simply direct the needy to state programs.
Next, the state can assist in returning charity and old-age provision to families by phasing out Social Security. There is no way to do this without someone losing some benefit they expected. Some group is going to receive less than it expected, whether those currently receiving benefits or those currently paying in to the system. Cutting benefits will succeed politically only if a large number are "grandfathered" into the current benefits setup. But the sooner Social Security taxes are ended, the sooner money will be freed up to go into personal savings and charitable efforts. Some nations have phased out their own Social security systems by moving to required contributions to individual IRA-type investments. The state has no legitimate authority to require people to provide for their retirement in any fashion, but at least the wealth redistribution aspect of old age provision would be reduced.
As difficult as the politics may be, eliminating Social Security is, I believe, a moral obligation. The closer we move to reestablishing the family as an economic support network, the stronger our society will be.
Timothy Terrell teaches economics at a small liberal arts college in South Carolina. In addition, he is director of the Center for Biblical Law and Economics, on the Internet at http://www.christ-college.edu/html/cble/. Dr. Terrell can be contacted at [EMAIL PROTECTED].
Keith Hudson, 6 Upper Camden Place, Bath, England
Keith Hudson, 6 Upper Camden Place, Bath, England
