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There are three main interpretations of the idea of a welfare state:
ETYMOLOGY The English term "welfare state" is believed to have been coined by Archbishop William Temple during the Second World War , contrasting wartime Britain with the "warfare state" of Nazi Germany. {Link without Title} In German , a roughly equivalent term had been in use since 1870 . There had been earlier attempts to use the same phrase in English, for example in the text "Four German Jurists" by Munroe Smith in Political Science Quarterly, 1901 , but the term did not enter common use until William Temple popularized it. In French , the synonymous term "providence state" ''(êtat-providence)'' was originally coined as a sarcastic Pejorative remark used by opponents of welfare state policies during the Second Empire ( 1854 - 1870 ). THE DEVELOPMENT OF WELFARE STATES Modern welfare states developed through a gradual process beginning in the late 19th Century and continuing through the 20th . They differed from previous schemes of Poverty Relief due to their relatively universal coverage. The development of Social Insurance in Germany under Bismarck was particularly influential. Some schemes, like those in Scandinavia , were based largely in the development of autonomous, mutualist provision of benefits. Others were founded on state provision. The term was not, however, applied to all states offering social protection. The sociologist T.H. Marshall identified the welfare state as a distinctive combination of Democracy , Welfare and Capitalism . Examples of early welfare states in the modern world are Sweden , the Netherlands 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 after the Poverty of the Depression. In the period following the Second World War , many countries in Europe moved from partial or selective provision of Social Service s to relatively comprehensive coverage of the population. ARGUMENTS FOR AND AGAINST THE WELFARE STATE The concept of the welfare state remains controversial, and there is continuing debate over governments' responsibility for their citizens' well being. Arguments in favor
Arguments against
The idea of a welfare state receives the most criticism from the country with the least amount of welfare services in the developed world - namely the United States . Some of this criticism concerns the idea that a welfare state makes citizens Lazy and less inclined to Work , a theory which some conservatives claim is proved by the current economic and social status of France . Another criticism is that the welfare state often provides its dependents with a similar level of income to the minimum wage, encouraging benefit fraud and economic inactivity, especially common now in the UK and France . Some conservatives in the UK claim that the welfare state has produced a generation of dependents who rely solely upon the state for income and support instead of working. They believe that the welfare state was created (In 1948 in the UK )to provide a carefully selected number of people with a subsistence level of benefits in order to alleviate poverty, but that it has been overly expanded to provide a large number of people indiscriminately with more money than the country can afford. A third criticism of the welfare state is that it results in high taxes. This is true, as evidenced by places like Denmark ( Tax Level at 50.4% of GDP in 2002) and Sweden (tax level at 50.3% of GDP in 2002). However, these countries also have high wage economies and high GNPs; high taxes do not necessarily result in poor economic performance. A fourth criticism of the welfare state is the belief that welfare services provided by the state are more expensive and less efficient than the same services would be if provided by private businesses. 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 could possibly not be able to afford them. More fundamentally, although private provision can reduce unit costs, it often does so through Adverse Selection , or exclusion of disproportionately expensive cases. However, this is not a barrier to carefully regulated private provision. The assumption that public provision is more costly overall, supported by the current state of the NHS (the third greatest employer in the world, which has large deficits looming) may be mistaken. National health care systems, for example, are often thought to be cheaper than equivalent provision through private care. {Link without Title} . In 2000, Professors Louis Kaplow and Steven Shafell published two papers, arguing that any social policy based on such concepts as justice or fairness would result in an economy which is Pareto Inefficient . THE WELFARE STATE AND SOCIAL EXPENDITURE Welfare provision in the contemporary world tends to be more advanced in the countries with stronger and more developed economies. Poor countries, on the other hand, tend to have limited social services. Within developed economies, however, there is very little association between economic performance and welfare expenditure (see A. B. Atkinson, Incomes and the Welfare State, Cambridge University Press 1995). There are individual exceptions on both sides, but as the table below suggests, the higher levels of social expenditure in the European Union are not associated with lower growth, lower productivity or higher unemployment, nor with higher growth, higher productivity or lower unemployment. Likewise, the pursuit of free market policies leads neither to guaranteed prosperity nor to social collapse. The table shows that countries with more limited expenditure, like Australia, Canada and Japan, do no better or worse economically than countries with high social expenditure, like Belgium, Germany and Denmark. The table does not show the effect of expenditure on income inequalities. It should be noted that welfare expenditure refers only to expenditure by the state, and does not encompass other forms of welfare provision (such as occupational welfare). The figures below show, first, welfare expenditure as a percentage of GDP for OECD member states, and second, GDP per capita (PPP US$) in 2001: Figures from the OECD for 2001 and UNDP Human Development Report 2003 [http://hdr.undp.org/reports/global/2003/pdf/hdr03_HDI.pdf Note: China, India, Indonesia, Brazil, Russia, and Pakistan have been left off because they are not members of the OECD, so the OECD didn't have figures for these countries. SEE ALSO
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