Interview with Charles Kesler on Obama book
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The interesting part is going to be standing amidst the rubble, assessing the situation and seeing where to go.
When the unsustainability of Greece's old spending habits became undeniable, Greeks rampaged through the streets burning cars. After that...?
I think that depends on how one defines a "welfare state."
To me, a welfare state can be defined by three programs: 1) education for the young, 2) pensions for the elderly, and 3) relief programs for the poor. If these elements were kept within their proper limits, there is no reason why such a state could not exist alongside the security/military/arbitrator role that states have traditionally played in society.
The problem isn't that the welfare state is fundamentally unaffordable, it's that the welfare state cannot be kept within these limits. In a democracy, the benefits of the second and third welfare programs that I identify above will always be spread to the middle class because that's where elections are won in a wealthy country. (Practically speaking, poor countries simply can't afford a real welfare state, even one kept within its proper limits.) Trying to put everyone on the public dole through universal pensions and health care is what is not affordable, which is what we have today with Social Security and Medicare (everyone in the sense that all of us will pass through these programs at some point if we live long enough).
What we have now I don't define as a welfare state. It has grown past those bounds. What we have now is a transfer state, and it is the transfer state that is unaffordable and doomed to collapse under the weight of its own IOUs.
Bingo. Too much of the constituency for it is stupid, gluttonous, and short-sighted, instead of smart, disciplined, and far-sighted. They simply don't have the self-control for a welfare state that will abide.
And of course, the public choice politics preclude fiscal discipline in the long run.
Absolutely. But it is the nature of those who have power to try to accumulate more power, and so the state expands far beyond where it should.