The Welfare State

Here are two short quotes from an excellent book, The Ethics of Money Production:

Today, the welfare state provides a great number of services that in former times have been provided by families (and which would, we may assume, still be provided to a large extent by families if the welfare state ceased to exist). Education of the young, care for the elderly and the sick, assistance in times of emergencies—all of these services are today effectively “outsourced” to the state. The families have been degraded into small production units that share utility bills, cars, refrigerators, and of course the tax bill. The tax-financed welfare state then provides them with education and care. (p. 189)

It is precisely because the welfare state is an inefficient economic arrangement that it must rely on taxes. If it had to compete with families on equal terms, it could not stay in business for any length of time. It has driven the family and private charities out of the “welfare market” because people are forced to pay for it anyway. They are forced to pay taxes, and they cannot prevent the government from floating ever-new loans, which absorb the capital that otherwise would be used for the production of different goods and services. (p. 190)

The book takes the reader through a wide range of subjects in economics and political philosophy, which is good. However, this does leave the reader asking many questions not covered by the book, since answering all of these would probably expand the book to a huge size. So I hope the author continues to write on e.g. ethics, and elaborate further on his many insights.