Welfare state

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There are three main interpretations of the idea of a welfare state.

  • 1. A "welfare state" is a type of government that assumes the primary responsibility for the individual and social welfare of its citizens.
  • 2. The "welfare state" refers to the provision of welfare services by the state.
  • 3. Welfare states may be identified with general systems of social welfare. In many "welfare states", welfare is not provided by the state, but by a combination of independent, voluntary and government services.
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The development of welfare states

State intervention in the provision of welfare developed after the Reformation, which disrupted previous systems for the distribution of religious charity. Early schemes were fostered in the 16th century in Ypres, in Belgium, and in Lutheran communities. The first national scheme was the English Poor Law of 1598/1601.

Modern "welfare states" developed in the late nineteenth and twentieth centuries. They differed from previous schemes of poor relief in their scope and relatively universal coverage. The development of social insurance in Germany under Bismarck was particularly influential. Some schemes, including those in Scandinavia, were based largely in the development of autonomous, mutualist provision; others were founded on state provision. Examples of early welfare-states in the modern world are the Sweden and New Zealand of the 1930s. Changed attitudes in reaction to the Great Depression were instrumental in the move to the welfare state in many countries, a harbinger of new times where "cradle-to-grave" services became a reality in contrast to the harsh mass-poverty of the Depression. In the period following the Second World War, many countries in Europe moved from partial or selective provision of social services to relatively comprehensive coverage of the population.

Welfare provision in the contemporary world tends to be more advanced in the countries with stronger and more developed economies; poorer countries generally have more limited welfare services.

Arguments for and against the "Welfare State"

The main arguments for a Welfare State are given in An Introduction to Social Policy (http://www2.rgu.ac.uk/publicpolicy/introduction/policy.htm) as being

  • humanitarian
  • religious, including both charity and the religious duty of solidarity
  • democratic
  • mutual self-interest - several national systems have developed voluntarily through the growth of mutual insurance, and
  • practical.

The main arguments against are

  • libertarian, on the basis that state action infringes individual freedom;
  • conservative, on the basis that it has undesirable effects on the way people behave; and
  • economic, from those who believe that welfare provision is costly and burdensome.

Ironically, the idea of a welfare state receives the most criticism in the country with the least amount of welfare services in the developed world - namely the United States. Most of this American criticism revolves around the idea that a welfare state would make citizens lazy and less inclined to work. That is unsupported by the economic evidence; there is no association between economic performance and welfare expenditure in developed countries. (See A. B. Atkinson, Incomes and the Welfare State, Cambridge University Press 1995) R. Goodin et al, in The Real Worlds of Welfare Capitalism (Cambridge University Press, 2000), show that on major economic and social indicators, the USA performs worse than the Netherlands, which has a high commitment to welfare provision.

A second criticism of the welfare state is that it results in high taxes. This is sometimes true, as evidenced by places like Denmark (Tax level of 50.4% in 2002) and Sweden (Tax level of 50.3% in 2002). However, these countries also have high wage economies and high GNPs; high taxes do not imply poor economic performance. In addition, they have a strong system of progressive taxation, which ensures that less burden falls on the poor and middle classes, and lowering taxes does not necessarily result in more spending money for the average citizen (since a lot of free services would no longer be free).

Finally, there is criticism that welfare services provided by the state are supposedly more expensive and less efficient than the same services provided by private businesses. As a first reply, proponents of the welfare state argue that the purpose of state-provided welfare is to alleviate poverty, not necessarily to be cheaper overall (in other words, they focus on the fact that, in a welfare state, the poor and lower-middle classes receive certain services free of charge, whereas in non-welfare states they would have to pay for those services, and many could not afford them). The "efficiency" of private enterprise is often achieved through "adverse selection" - a refusal to deal with the people in greatest need, because they are more expensive to treat. But they also point to the fact that, in countries with less welfare provision (such as the United States), services are substantially more expensive. This is especially true in health care, because of its organisational diversity, its heavy administrative costs, the lack of responsiveness (or "elasticity") of consumer demand to changes in price, and the problems of market failure, such as the large gap in knowledge between doctor and patient. State-run systems like the UK National Health Service are proportionately cheaper, and have better coverage, than market-based systems. The OECD produces international statistics on health care. [1] (http://www.oecd.org)

Examples of welfare states

See also

de:Sozialstaat et:Heaoluriik fr:État-providence [[he:מדינת רווחה]]

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