Monday, May 24

Take a Good Look, America

"Six weeks of vacation a year. Retirement at 60. Thousands of euros for having a baby. A good university education for less than the cost of a laptop.

"The system known as the European welfare state was built after World War II as the keystone of a shared prosperity meant to prevent future conflict. Generous lifelong benefits have since become a defining feature of modern Europe.

"Now the welfare state - cherished by many Europeans as an alternative to what they see as dog-eat-dog American capitalism - is coming under its most serious threat in decades: Europe's sovereign debt crisis.

"Deep budget cuts are under way across Europe. Although the first round is focused mostly on government payrolls - the least politically explosive target - welfare benefits are looking increasingly vulnerable.

"'The current welfare state is unaffordable,' said Uri Dadush, director of the Carnegie Endowment's International Economics Program. 'The crisis has made the day of reckoning closer by several years in virtually all the industrial countries.'"

http://apnews.myway.com/article/20100523/D9FSPCAO1.html


The other side of the problem, using Germany as the example:

"Germany is shrinking — fast. New figures released on May 17 show the birth rate in Europe's biggest economy has plummeted to a historic low, dropping to a level not seen since 1946.

...

"According to a preliminary analysis by the Federal Statistics Office, 651,000 children were born in Germany in 2009 — 30,000 fewer than in 2008, a dip of 3.6%. In 1990, German mothers were having on average 1.5 children each; today that average is down to 1.38 children per mother. With a shortfall of 190,000 between the number of people who died and the number of children who were born, Germany's birth rate is well below the level required to keep the population stable."

http://www.time.com/time/world/article/0,8599,1991216,00.html?xid=rss-topstories

2.1 is considered replacement rate. And that still may not be enough to pay for an expensive welfare state.

More birth rate estimates for 2010:

UK: 1.66
Japan: 1.2
Spain & Italy: 1.32
Russia 1.41

https://www.cia.gov/library/publications/the-world-factbook/rankorder/2127rank.html?countryName=Kazakhstan&countryCode=kz&regionCode=cas&rank=150#kz

5 comments:

Mover Mike said...

And these sobering statistics may be a big reason the U.S. doesn't care about its porous border to the south.

David said...

Very good point, Mike!

Bigvic said...

Your argument is very faulty because of one underlining fact, your confusing correlation with causation here. The reason the welfare state is failing is exactly because of Europe's sovereign debt crisis which doesn't allow a country to control its own monetary policies. If Europe was more integrated with a central fiscal policy, I guarantee we would be talking about the success of the welfare state. For a concrete example, look at the country Norway which is not in the EU. The Norway model is actually MORE generous then the EU welfare states. They actually have a higher GDP (PPP) per capita then the US, third most in the world. During the recession they were one of the few countries in the World to actually have a surplus and not a deficit, and surprisingly they did not have to cut social welfare programs. They are considered to be one of the most egalitarian societies in the world and they also have on the highest tax codes in the world, which goes well above 50%. They were ranked first by the UN human development index for most of the decade, and the were ranked last by the "ultra liberal" magazine FP in their Failed State Index. This country has free public higher education, one year paid maternity leave and a one month paid paternity leave. The state owns the commanding heights of the economy, and these companies are actually successful. I think you are mis-characterizing incompetence with welfare state. Yes America should take a good look, at Norway, which has a generous welfare state with its population having a higher standard of living then us over here and still is able to maintain a surplus and not run deficits. The problem is not welfare it is inefficiency, which as Norway proves, has nothing to do with government, but the people in government, or maybe the people choosing the government.

Cioara Andrei said...

Foarte interesant subiectul deybatut de tine.M-am uitat pe blogul tau si imi place ce am vazut, cu siguranta am sa mai revin o zi buna!

Anonymous said...

Bigvic maybe someday when you have to get a job you will come to understand that it is not worth working hard at anything if some Socialist is going to take more than half of your wages and give it to those who do not/will not work.. This breeds a society that becomes very unmotivated and more and more non productive..If Norway is such a good place to live and be educated for free, why are you in Boston going to school?? Could it be that only in America can you get the education you desire?? I have been alive long enough to know that NOTHING, in this world, is free!! Everything comes at a cost.. It may not be a monetary cost but a cost just the same.. Socialism has failed everytime it has been tried for the simple reason that individuals have nothing to look forward to..The best advice I can give you is...A Government big enough to give you all you need is a Government big enough to take all you have...