Forget the propaganda against the unemployed, economists and researchers show how government benefits can boost the economy.
After the Conservative ‘victory’ in the British elections, the subject of welfare is a hotly debated topic, as it is in the States and elsewhere. The economic crisis has been used as an excuse to attack the most vulnerable in society, with politicians (supported by the corporate media) threatening to cut benefits and expand their controversial forced labor schemes for the unemployed. Sadly, fear has triumphed over compassion in Britain, with most of the population in favor of these cruel policies (and vile ‘reality’ TV shows such as Benefits Street have certainly played their role in this growing contempt for the poor).
However, research doesn’t lend any support to the idea that the welfare state encourages laziness. In fact, a recent study has shown that people are more likely to look for work if they live in a country where taking government handouts are an easy option. Sociologists Dr Kjetil van der Wel and Dr Knut Halvorsen examined responses to the statement ‘I would enjoy having a paid job even if I did not need the money’ in 18 European countries. Over 19,000 people participated.
In Norway, a country with the most generous welfare system in Europe, over 80% of people asked agreed with the statement. In Britain, with an average level of welfare, 60% agreed. In Estonia, which has the lowest level of financial support, only 40% said they would prefer to work rather than receive help from the government. It’s also worth pointing out that the countries with the highest levels of financial support for the needy also have the highest employment rates, destroying the assumption that people who don’t have to work won’t bother even trying.
“Many scholars and commentators fear that generous social benefits threaten the sustainability of the welfare state due to work norm erosion, disincentives to work and dependency cultures,” the researchers wrote. But this simply isn’t true. They continue: “The notion that big welfare states are associated with widespread cultures of dependency, or other adverse consequences of poor short term incentives to work, receives little support. On the contrary, employment commitment was much higher in all the studied groups in bigger welfare states. Hence, this study’s findings support the welfare resources perspective over the welfare skepticism perspective.”
American economist Robert Reich has been saying the same thing about pensions in the States. In this video, he argues that more generous welfare would actually help the US economy. “Social Security is more important than ever,” he says. “Today, two-thirds of seniors derive over half of their income from Social Security, and one-third of seniors rely on it for at least 90% of their income. Without it, the poverty rate of our seniors would be 45% instead of 10%.”
“Social Security will be there for you in your retirement. The problem is it won’t pay you enough. That’s why it’s important to expand Social Security – not cut Social Security benefits.” How can we do this? By making taxation fair. “Corporations are awash in money, and they could afford to provide their hourly workers with pensions when they retire,” Reich points out. “A billionaire pays the same Social Security payroll tax as someone earning $118,500. This isn’t fair and it’s not sensible. Billionaires and millionaires should pay just like everyone else. Scrap the cap, and not only is Social Security more secure for you and your kids, but it will be able to pay out even more benefits in your retirement.”
What are your opinions on welfare? Let us know in the comments.