segunda-feira, junho 21, 2004
O Colapso do "Modelo Social Europeu"
Na Tech Central Station
The European Social Model is not sustainable. And now is about time to start talking openly about this, and about what kind of society will come after big government. Between 1950 and 1980, the average tax pressure in Western Europe more than doubled. Government became an ever larger part of society. High taxes are now financing large public monopolies in the fields of welfare services and social security. Now that model has reached its final days.
The model was harmful from the start. High taxes are always a burden on production and are thereby eroding the basis of all prosperity and welfare. Moreover, public monopolies have no incentives to increase efficiency and adapt services to people's demands. So you get harmfully high taxes and bad welfare services. Why was this model chosen? Mainly because the choice was made at a time when many politicians and economists were impressed by the idea of a centrally planned economy.
Today, the planned economy has collapsed. And the cracks in our planned part of the economy -- big government -- get more obvious every day. Basically for the same reason: the system doesn't work. Despite the high taxes, the public systems are unable to deliver the welfare that people want. That difference between supply and demand of welfare services will grow, since services get more expensive every year. And since taxes cannot increase more, the resources for welfare services are actually decreasing.
High taxes pay for an unsustainable system which cannot deliver. Hence, European politicians have made reforms for lower taxes, increasing growth and cutting public expenses. But they are scratching the surface and voters are largely unaware of the purpose of this and the aim of it all. European leaders should tell people where we are heading. Taxes will be lowered, the public welfare services and social security will mostly be for those who cannot pay for themselves and for the rest of us there will be private welfare companies and private insurance.
It is a positive vision. Today, we have low growth and insufficient welfare. Tomorrow, we will have high growth and everyone will have the welfare services and social security they demand. With lower taxes, most people could afford to buy their own private welfare. The public sector will help those in need instead of aiming to do everything for everyone. A large sector of health care, education and insurance will be opened to private companies and develop through competition.
posted by Miguel Noronha 4:36 da tarde
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