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Negative Welfare

Western countries have developed a myriad of social programs to financially help citizens, most of whom are not wealthy, through various stages in their lives. Old-age pensions, unemployment insurance, workers’ compensation, welfare, health-care assistance, child-care assistance, disability assistance, housing assistance, and educational assistance are all examples of various social programs. However well-meaning a social program may be, a social program always has three inherent drawbacks that limit its effectiveness.

First, any social program requires a small army of civil servants and substantial office space to administer the program properly. It is not unreasonable to assume that 10% of total cost of a social program is the necessary bureaucracy. Even if this 10% is putting the other 90% into good places, that 10% is still a resource that has been taken out of the economy.

Second, social programs are guided by legislation, which determines the beneficiaries and benefits. Regardless of how well constructed this legislation is, there will always be citizens “falling through the cracks” who really need the benefit but can’t get them. And there will also be dishonest citizens legally taking advantage of the program when they really don’t need it.

Third, societal resources are consumed to build political support for social programs, create legislation, and later fix that legislation. Perhaps these resources could be used in other places to build a better world.

One solution to minimize the bureaucratic costs, ensure more fairness, and conserve societal resources would be to give all citizens a stipend each month to cover basic living expenses. These expenses would provide basic shelter, food, household and clothing, and travel, plus a little for entertainment. With such a stipend, the citizen need not find work or some other government program to survive. This “universal welfare” would be automatic payment to each citizen and would not be based on any criterion on that person’s lifestyle.

However, if the citizen wants to enjoy some of the better things of life, that citizen will have to find a job to pay for those things.

There are several societal benefits from universal welfare. First, citizens currently living at the poverty line are usually under a lot of financial stress, which in turn causes bad decisions that keep these citizens at the poverty line. With the basic expenses always taken care of, a lot of the stress of the lower classes is removed and they are more able to move past their plight. Second, employers are going to have to treat employees a lot better for employees would no longer have to suffer with bad jobs. Universal welfare will produce a better class of managers, which will enhance the economy. Third, a citizen who spends the stipend foolishly and refuses to take responsibility would be a candidate to become a ward of the state because that citizen cannot take care of him- or herself.

Universal welfare should not be implemented immediately. Rather it should be a process lasting several decades, slowly increasing the stipend each year. In this way, society won’t be burdened by a large class of instant freeloaders this current generation is likely to produce. Social engineers will be watching trends and building societal directives to minimize the freeloading effect. As well, the nature of other social programs is likely to change as the stipend increases. We need time to adjust the allocation of resources and our thinking about these resources. In time, many of these social programs should disappear, contributing to a more efficient society. And only a very few will be in a state of poverty.

Published on 2015

The TDG Essay

Building a Kinder, Wiser Democracy