The Death Of The "welfare State"

[Hjalmar]

A socialist minded government has little interest in people who have ambition, drive, and are go-getters..... Rather they recruit their followers from among the losers in our society -- people that may NEED THEM..... This is how they get their votes -- by promising to give people everything imaginable. And in the past, before we heard the words deficit and debt, people bought into this.... But why would anyone today, vote for a party that has nothing to offer but give-aways, when everyone knows that the cupboard is bare?

[Michael Hardner]

Hjalmar:

We're talking about two different things. I'm referring to progress for the country as a whole. You're tieing progress to living standards for the people. Our country can very well progress even though living standards for the people don't improve.

What is progress then ? Technological progress means that productivity increases over time. This is a historical fact.

This type of progress reduces the cost of producing goods, and increases the aggregate wealth as time goes on.

Economics teaches us that a rising tide lifts all boats. This means that a better economic situation helps everyone in society. So, standards of living should therefore increase.

A socialist minded government has little interest in people who have ambition, drive, and are go-getters..... Rather they recruit their followers from among the losers in our society -- people that may NEED THEM..... This is how they get their votes -- by promising to give people everything imaginable. And in the past, before we heard the words deficit and debt, people bought into this.... But why would anyone today, vote for a party that has nothing to offer but give-aways, when everyone knows that the cupboard is bare?

You're making socialism into a bogeyman here. Rather than posting your views on their parasitic recuitment practices, why not post what specific programs you disagree with ?

Socialism and capitalism in its pure forms are dead, and today we have a hybrid of both these systems. Go after specific programs in your arguments, rather than generally attacking philosophies of the past.

What give-aways do you speak of ? Welfare ? Do you think that there are enough welfare recipients in society to make a difference, politically ? Be specific.

[willy]

"Rather than posting your views on their parasitic recruitment practices, why not post what specific programs you disagree with?”

If you disagree with the premise, all possible conclusions will show faults.

Why do people do what they do?

The answer of this question is the foundation of every policy that comes out of the political spectrum. When they get the wrong foundation or they are only addressing things in a purely reaction basis you limit the ability to do the public any real good.

[Hjalmar]

Michael Hardner

What give-aways do you speak of ? Welfare ? Do you think that there are enough welfare recipients in society to make a difference, politically ? Be specific.

Other than assistance for the aged, sick and handicapped, I disagree with all of them. No give-aways to healthy people under age 65.

What is progress then ? Technological progress means that productivity increases over time. This is a historical fact.

Progress comes in many forms and in many cases results in improved living standards but not necessarily so. A country could conceivably progress while at the same time peoples standard of living can diminish.

[Michael Hardner]

Other than assistance for the aged, sick and handicapped, I disagree with all of them. No give-aways to healthy people under age 65.

With WHICH programmes ?

Progress comes in many forms and in many cases results in improved living standards but not necessarily so. A country could conceivably progress while at the same time peoples standard of living can diminish.

Sure, a country could progress socially, and in any other way you care to name. But why are you again avoiding the point ? The point is about standard of living increasing over time...

I'll try again:

Technological progress generally improves over time. Do you agree/disagree ? Technological progress results in diminished costs, and therefore more wealth for producers ? Do you disagree/agree ?

If you agree with these premises, then you must agree there's no material reason for standard of living to diminish over the long term.

[Hjalmar]

Michael Hardner

Sure, a country could progress socially, and in any other way you care to name. But why are you again avoiding the point ? The point is about standard of living increasing over time...

Let me try a different way .. How high is up? It is one thing to constantly try to improve ones standard of living by increasing wages every year. In your opinion is that the only way to improve ones standard of living .. In other words, can a persons standard of living improve only with additional money? In my view, progress in Canada can only come about through reduced union wages so that more people can remain employed. I call that progress.

Technological progress generally improves over time. Do you agree/disagree ?

Agree

Technological progress results in diminished costs, and therefore more wealth for producers ? Do you disagree/agree ?

agree and disagree. Not necessarily more wealth for producers because of labour union powers. As soon as they hear their employer had a good year they say "Let's go get our share" and they go on strike, sometimes bankrupting the employer. Would this result in everyones standard of living dropping, including the employers?

[Michael Hardner]

Let me try a different way .. How high is up? It is one thing to constantly try to improve ones standard of living by increasing wages every year. In your opinion is that the only way to improve ones standard of living .. In other words, can a persons standard of living improve only with additional money? In my view, progress in Canada can only come about through reduced union wages so that more people can remain employed. I call that progress.

Improved standard of living generally means more money, I think. There are other ways for people's lives to improve but we're talking about economics here.

QUOTE 

Technological progress results in diminished costs, and therefore more wealth for producers ? Do you disagree/agree ? 

agree and disagree. Not necessarily more wealth for producers because of labour union powers. As soon as they hear their employer had a good year they say "Let's go get our share" and they go on strike, sometimes bankrupting the employer. Would this result in everyones standard of living dropping, including the employers?

Take the labour factor out for a second. If you do that, then you'll find that costs generally fall over time and therefore producers can produce more with less.

Where do these cost savings go ? Reduced prices ? Somewhat, yes, but also to increased profits.

[Hjalmar]

Taxes

Accounts Receivable Tax

Building Permit Tax

Capital Gains Tax

CDL license Tax

Cigarette Tax

Corporate Income Tax

Court Fines - (indirect taxes)

Dog License Tax

Federal Income Tax

Federal Unemployment Tax - (FUTA)

Fishing License Tax

Food License Tax

Fuel permit tax

Gasoline Tax - (42 cents per gallon)

Hunting License Tax

Inheritance Tax Interest expense - (tax on the money)

Inventory tax IRS Interest Charges - (tax on top of tax)

IRS Penalties - (tax on top of tax)

Liquor Tax

Local Income Tax

Luxury Taxes

Marriage License Tax

Medicare Tax

Property Tax

Real Estate Tax

Septic Permit Tax

Service Charge Taxes

Social Security Tax

Road Usage Taxes - (Truckers)

Sales Taxes

Recreational Vehicle Tax

Road Toll Booth Taxes

School Tax

State Income Tax

State Unemployment Tax - (SUTA)

Telephone federal excise tax

Telephone federal universal service fee tax

Telephone federal, state and local surcharge taxes

Telephone minimum usage surcharge tax

Telephone recurring and non-recurring charges tax

Telephone State and local tax

Telephone usage charge tax

Toll Bridge Taxes

Toll Tunnel Taxes

Traffic Fines - (indirect taxation)

Trailer registration tax

Utility Taxes

Vehicle License Registration Tax

Vehicle Sales Tax

Watercraft registration Tax

Well Permit Tax

Workers Compensation Tax

COMMENTS:

Not one of these taxes existed 100 years ago and our nation was the most prosperous in the world, had absolutely no national debt, had the largest middle class in the world and Mom stayed home to raise the kids.

Very similar here in Canada.

What the hell happened ???

[Greg]

Hjalmar, I assume you got your tax list off of some American website, as these are American taxes, not Canadian taxes. Canada and the US fair some similarities in our tax system, but there are also some large differences.

However, your point still stands, the state taxes have increased drastically over the past 100 years. But you do have to admit that there are more state services available today than there was 100 years ago.

[Black Dog]

A socialist minded government has little interest in people who have ambition, drive, and are go-getters..... Rather they recruit their followers from among the losers in our society -- people that may NEED THEM..... This is how they get their votes -- by promising to give people everything imaginable. And in the past, before we heard the words deficit and debt, people bought into this.... But why would anyone today, vote for a party that has nothing to offer but give-aways, when everyone knows that the cupboard is bare?

This is an abstraction, a nebulous critique of "socialist" governments, tinted with a broad and unsupported generalization.

As for the cupboard being bare, that's not the case. It's not a question of resources but one of priorities. Over the past two decades, debt and deficit reduction, low inflation and reduced spending have been the key priorities of most western governments. This is often accompanied by privatization and the selling off of public assets, reduced services and, paradoxially, tax cuts. This budget year, the feds earmarked $4 billion to reduce the debt, with the ultimate goal being a 25 per cent debt-to-GDP ratio. Yet the question of why debt reduction is the key priority is seldom asked. Indeed, like the notion of tax cuts, it's become gospel.

Let me try a different way .. How high is up? It is one thing to constantly try to improve ones standard of living by increasing wages every year. In your opinion is that the only way to improve ones standard of living .. In other words, can a persons standard of living improve only with additional money? In my view, progress in Canada can only come about through reduced union wages so that more people can remain employed. I call that progress.

Of course standard of living is more than just money in the bank, but includes quality and accesability of services like health care, education etc.

As for high union wages being responsible for unemployment, I think that's a mighty simplistic view. For one thing, globalization has contributed greatly to the problem as well-paying jobs are being outsorced internationally for far cheaper. Then there's downsizing, which has seen even profitable companies chop jobs in order to maximize profits. In short, it's far more complicated than the "unions are bad" scenario being peddled

Not one of these taxes existed 100 years ago and our nation was the most prosperous in the world, had absolutely no national debt, had the largest middle class in the world and Mom stayed home to raise the kids.

Very similar here in Canada.

What the hell happened ???

The difference is who's paying the freight. Back in the day, wealthy people carried a larger share of the tax burden. I don't have the Canadian figures handy, but in 1955, the U.S's top marginal income tax rate was 91 per cent. Today, it's about 36 per cent.

Nowadays, it's the poor and middle class who are picking up the slack income tax wise, while also paying additional hidden taxes and user fees. Wealthy individuals and corporations also have a dizzing variety of tax loopholes, dodges and shelters that the average individual can't touch. The solution, then, is in progressive taxation, debt management (BTW, the debt isn't actually growing; economic growth would naturally reduce the debt so an aggressive debt-reopayment strategy is uneccesary) and public investment in infrastructure and other programs to create jobs and boost the economy.

[cgarrett]

i'd like to add here that we live in an economic reality where 99% of industry is mature and established and owned.

the whole idea of encouraging entrepreneurship is hugely overrated and entirely motivated by right wing feudalism to cut their tax cost. most of our economy is bricks and mortar business that hasn't changed or had competition for decades.

the last several decades has also seen the percentage of our nations wealth concentrating in the top 5% of the richest of canadians.

[willy]

I work in the information age. I own a company that has grown each year for the past six years and that is in spite of paying half of my revenues to Ottawa in taxes.

I may not be Wall Mart or GE but, I am happy. I have a good living, I employee people and I add value to the economy.

What expectations do you hold for your personal wealth? The resources of the world are scarce. This is the first day of econ 102, and this is not propaganda, it is the truth. Why argue for the poor other people? What opportunity don't you have? Find a job, sacrifice, and expect the government to do no more than remove barriers.

Check what you measure. Let’s work on getting everyone the opportunity to impact their own standard of living. We need some personal responsibility back in the welfare state.

[Hjalmar]

We need some personal responsibility back in the welfare state.

Nail on the head willy. You have zeroed in on the one area where Canada has been going downhill ever since the advent of Pierre Trudeau in 1968. It appears that governments are incapable of reversing this trend. Some of the Oriental countries are far ahead of us when it comes to teaching their children personal responsibility while Canada promotes protection from cradle to grave. As it happens, welfare spending in most of these Oriental countries is almost unheard of.

[Hjalmar]

What amazes me is the way governments so freely and recklessly continue to introduce new social spending for the sole purpose of electoral support, knowing full well that, once introduced, become virtually impossible to rescind or even scale back...

Intergenerational theft is what I call it .. our ancestors are left to pay the bills..

[Hjalmar]

How to survive and thrive during the collapse of the welfare state [by James Dale Davidson and Lord William Rees-Mogg]

Because information technology transcends the tyranny of place, it will automatically expose jurisdictions everywhere to 'de facto' global competition on the basis of quality and price. In other words, governments exercising local territorial monopolies, like most other entities, finally will be subject to real market competition on the basis of how well they serve their customers. This will soon make it unavoidably obvious that the old logic that favored high-cost regimes in the industrial era has reversed. Leading nations, with their predatory, redistributive tax regimes and heavy-handed regulations, will no longer be jurisdictions of choice. Seen dispassionately, they offer poor-quality protection and diminished economic opportunity at monopoly prices. In the years to come, they may prove to be more socially unreceptive and violent than regions of Asia and Latin America where incomes have traditionally been more unequal. The leading welfare states will lose their most talented citizens through desertion.

[Hjalmar]

A number of years ago Ian Smith, Prime Minister of Rhodesia, advocated a voting system whereby every voter would undergo an intelligence test before voting and the votes would be tallied based on the intelligence of the voter... votes would count anywhere from 1 to 5 points based on intelligence. I think such a system would be great for Canada -- would wipe out the NDP forever.

[August1991]

On the contrary, hjalmar, the left wing would all pass such "intelligence tests". The left love preparing others to pass committee designed tests, committee decisions about attainable competencies, intricate State tests and bureaucratic intrigues.

Free thinking individuals will lose against any committee.

And BTW, Ian Smith was the ultimate closed-shop union, or closed-minded committee. What are you hjalmar? Closed or open-minded?

[falling leaf]

August 1999

I think Hjalmar has a point here!

I hear from people all the time their excuses for not voting.

1. Not into politics

2. I am too busy trying to make a living to take interest in anything but my job.

3. I don't know what party to vote for so I am not going to vote.

4. Some even couldn't tell you what party is running our country at the moment , and where Ottawa is.

5. Some can't even tell you who our Prime Minister is, or where he came from.

6. Heres my favorite one , why should I vote - this country is not going to change.

Maybe a test isn't a bad idea for people who don't even know the basics about our countries history ,economics ,political history,

Maybe just a common sense test, We do have to take tests to drive. or enter higher education,

Why not to vote.

[Hugo]

Maybe just a common sense test, We do have to take tests to drive. or enter higher education, Why not to vote.

I'll tell you why. First of all, who sets the questions, and how do you guarantee they are unbiased? Second, all the losing parties will immediately claim that the questions were rigged and that they lost unfairly, they'll demand a new election and so on - it'll be like the US 2000 election every time.

I know that this idea has the best of intentions, and it has occurred to me too, but democracy is the rule of the citizen, not of the smart citizen, or the well-educated citizen. Once you change that, you are moving away from democracy and setting the very dangerous precedent that some people can be denied the right to vote. That's worth saying again: you would be setting a precedent for a portion of the citizenry to be denied the right to vote. Anybody failing this test would not be self-governed, just as surely as if they lived in Castro's Cuba.

The best assault on this problem, as I see it, is to make politics and economics compulsory subjects in high school, and ensure that each citizen at least knows the basics of these subjects. So much of the political and economic ignorance I hear spouted - even from supposedly well-informed people - is really 101 stuff.

[Hjalmar]

A wake-up call for Canada

In 1991, after they had already largely abandoned the classic Swedish model of the postwar years, the social democrats were voted out of office... The new conservative government appointed a commission of seven non-socialist economists "to analyze the economic crisis in Sweden and to suggest ways to solve it. "Turning Sweden Around" documents the revenge of the iron law of wages... It finds an unemployment rate of 14%, public

sector spending running at an unsustainable rate of 70% of Gross Domestic Product, a fall from arguably first among

industrialized nations in GDP per capita to 14th, a strong inflation bias, recurrent budget deficits, and severe financial and building crises.

In its six sophisticated, well-written, and mathematically accurate chapters "Turning Sweden Around" repeats again and again one central and pervasive theme:... Swedish wages are too high... To compete in international markets, Sweden must produce goods at competitive prices, which means paying less to workers (either directly or indirectly, through taxes).

The main theme of "Turning Sweden Around" is not a surprise. it is common sense...it is the teaching of plain old fashioned classical micro-economics...it is a conclusion mandated by the constitutive rules of modern society.

That historical experience revealed the limitations of the Swedish model is not a surprise.... What is surprising is that in the 1950's and 1960's so many people believed that the Swedish model was sustainable and generalizable to the rest of the world.... What needs to be explained is the specious credibility of the illusions it engendered.

Common sense says that as a general rule, with limited

exceptions, high wages cannot be sustained in an open economy because global competition will require producers to cut costs, and therefore wages

[CanadaRocks]

Common sense says that as a general rule, with limited

exceptions, high wages cannot be sustained in an open economy because global competition will require producers to cut costs, and therefore wages

What then is our alternative? To accept the gradual lessening of wages until all are willing to work simply for a handful of food for our starving bellies and a rag to wrap around ourselves, to allow ourselves to be turned into starving animals, as is the current case in some third world countries where business's can find the cheapest labor in the world? ..all in the name of global competitiveness?

[Hugo]

What then is our alternative? To accept the gradual lessening of wages until all are willing to work simply for a handful of food for our starving bellies and a rag to wrap around ourselves

History tells you that the exact opposite will happen. Socialist policies result in higher unemployment and lower wages, the free market gets us closer to full employment and higher wages.

No examples are needed, just go and read about the history of the Western world from the industrial revolution onward.

[CanadaRocks]

No examples are needed, just go and read about the history of the Western world from the industrial revolution onward.

If history were circular, there would be a greater validity to your answer. History is closer to a spiral than a circle, and so similar situations do not always mean similar results.

Jobs all performed at the lowest wage that a deregulated world market can supply.

No social supports.

Technology advanced to a point that it replaces most jobs.

The bulk of society without a viable means of support.

History would say chaos, revolution.

I think your answer to my question is much more like a brushoff, than an answer if you'll forgive my impudence for saying so.

[idealisttotheend]

Socialist policies result in higher unemployment and lower wages, the free market gets us closer to full employment and higher wages.

Full employment is not in the short term interests of the free market (and it rarely if ever anymore considers the long term anymore). The more people employed the higher wages go therefore creating resistance to higher employment. In fact many right wing think tanks now agree that unemployment is necessary even preferable as a way to keep labour costs down. They continue to blame the unemployed for their "own problems" though.

No examples are needed, just go and read about the history of the Western world from the industrial revolution onward.

Really. During the depression there were few if any "socialist" policies in effect. People starved and corporations continued in some cases to make large profits. During the war, many "socialist" policies (government control of large parts of the economy) had to be put in place and... well everyone had a job and food to eat. During the 50s, 60s, 70s much of the Welfare state was put in place. Unemployment was rarely over 2%. Then came the market reforms of the 80s and 90s and now where is unemployment?

In fact one could argue that it was the lack of "socialist" policy in regards to oil prices (oil being something we cannot reasonably choose not to buy and a structural element of the economy) that have caused the debt problems and unemployment, combined with the market's inability to replace oil with another source of energy that can be domestically produced even though such technologies seem to exist or can be developed (actually casued by "socialist" polices of right wing governments in the US).

But then that's treason out here in the west.

[Hugo]

During the depression there were few if any "socialist" policies in effect.

Socialist policies caused the depression. Protectionism led to a slump in global trade which provoked the recession. FDR's inept socialist policies aimed at recovery actually prolonged it. These were socialist ideas such as agricultural price fixing (leading to agricultural underproduction and food shortages), and a minimum wage which increased unemployment massively at a point when recovery looked imminent and plunged the USA back into the depths of recession again. Please, go and read up on this subject before you post again.

Just looking at modern examples, since China moved away from socialism and joined the world market the average income of the Chinese has nearly quadrupled. Could you explain that in a way that justifies your wrongheaded ideas?

The fact of the matter is that for the welfare of the common man, socialism has been proven inferior time and time again. Not a single example exists of socialism having improved the existence of the average citizen. Worse, socialism has become a tool for tyranny, murder and human rights abuse because of the grotesque concentration of power that accompanies it.

Mixed economies do not work as well. Sweden, Norway and Canada have all encountered economic problems. Sweden and Norway, whose public sectors were larger, had more severe problems leading to the dismissal of a socialist government and the introduction of a committee of non-socialist economists to specifically study the problem of fixing the damage done by socialist policy.

All three have substantially larger portions of their populations below the poverty line than the USA. All those portions are rising, compared to the American poor, which is shrinking. Over a quarter of Norwegians do not earn a living wage.

But then that's treason out here in the west.

Only if you actually studied economics.