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welfareThe German economist Wilhelm Röpke, commenting on the expansion of European welfare states in 1958, wrote, “To let someone else foot the bill is, in fact, the general characteristic of the welfare state and, on closer inspection, its very essence.” While he did not argue that, therefore, such state assistance should in all cases be stopped, he put the question in sober terms: “[T]he welfare state is an evil the same as each and every restriction of freedom. The only question on which opinions may still differ is whether and to what extent it is a necessary evil.”

In the interest of carrying on that same sobriety of analysis, I believe the picture is far bleaker today. Röpke, in the title to the essay quoted, characterized the welfare state as “robbing Peter to pay Paul.” But Sts. Peter and Paul were contemporaries. If only we would simply rob our peers! Then we could have a lively discussion regarding “whether and to what extent” such robbery is “a necessary evil.” Instead, it is our children and grandchildren who must “foot the bill.” Yet on our current course, when the time comes to pay up there will be much less welfare available to them.

In a recent essay at First Things, Stephen Phelan examines a negative trend of modern economies undervalued by Röpke: population decline. Phelan reports that in the world today,

the most dynamic economies appear to be those benefitting from a large population or high fertility, even as the developed world’s debt explodes in an effort to maintain a standard of living that is only apparently sustainable by borrowing from one’s children—children which many of these nations refuse to have.

Rising standards of living in several African countries, he notes, coincide with high birthrates in these same countries. Phelan’s aim is to counter the propagators of population control, such as the Bill and Melinda Gates Foundation, who claim that more children will only hold countries back from economic progress.

Convincing NGOs that their Malthusian policies are doing more harm than good may be difficult enough. Convincing the young, educated, and heavily in debt in developed countries that they need to have more children to pay for benefits that we may not be able to afford when they need them is harder still. It has become increasingly more difficult to convince them even to get married.

In light of this, some would blame Millennials, and perhaps that is not always unmerited. But such sentiment could just as easily be seen as blaming the victims. Devalued educations, high debt, and high underemployment make up the inheritance they have received. A bit of pessimism about their future prospects is understandable.

As a Millennial myself, I am doing my part, I suppose (though I would hardly think of it in such sterile, economic terms). My wife and I have a child, and we intend to have more if possible. But what inheritance will my son receive? In order to pay for today’s state assistance, we are effectively spending my two-year-old son’s future tax dollars through debt, and at an unsustainable rate.

Consider, for example, the Congressional Budget Office’s (CBO) 2014 projections this past July. Under current law, after 2018, “The pressures stemming from an aging population, rising health care costs, and an expansion of federal subsidies for health insurance would cause spending for some of the largest federal programs to increase relative to GDP.” The consequences?

  • “[A] smaller stock of capital and lower output and income than would otherwise be the case, all else being equal.”
  • “Federal spending on interest payments would rise, thus requiring higher taxes, lower spending for benefits and services, or both to achieve any chosen targets for budget deficits and debt.”
  • “The large amount of debt would restrict policymakers’ ability to use tax and spending policies to respond to unexpected challenges, such as economic downturns or financial crises. As a result, those challenges would tend to have larger negative effects on the economy and on people’s well-being than they would otherwise. The large amount of debt could also compromise national security by constraining defense spending in times of international crisis or by limiting the country’s ability to prepare for such a crisis.”

Thus, what we have to look forward to, on our current course, is fewer resources, higher taxes or less spending (or both), and general economic instability, which carries with it risks to national security, among others.

But that last point is not anything to worry about, right? It is not as if, only one month before this CBO report was issued, a network of brutal religious extremists has conquered half of Iraq and Syria. Except, of course, that is exactly what has happened. These events were likely too current to factor into the report, and this was long before the president, by his own admission, had any sort of strategy to counter this growing threat. Today, only three months later, the likelihood of “defense spending in times of international crisis” has become far more pronounced. Should we continue using more and more of our children’s resources on benefits that realistically will not be as widely available to them, if at all?

I will happily go on record as saying that “robbing Peter to pay Paul” has often been a “necessary evil,” far favorable to the realistic alternatives (such as letting Paul suffer and die where private assistance is wanting). The truly isolated elderly with no one with means to support them should be able to fall back on some public support as part of our social contract. The same goes for disabled, chronically ill, and mentally ill persons. But we cannot have it all, not for long, not at our current rate, and not when military action abroad—whatever one’s view of it—is now, once again, a fixture of the foreseeable future.

That said, as I have argued in the past, we are neither powerless nor hopeless today. We can prudently sacrifice now, cutting down on present inefficiencies during these next few years in which our economy may even continue to improve. Then we would have something better to leave to our children than the bill for our well-being. Before we today can even have the discussion Röpke called for more than fifty years ago, we need and ought to get back to just “robbing Peter” rather than our sons and daughters as well.

Books on the topic of this essay may be found in The Imaginative Conservative Bookstore.

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Published: Oct 18, 2014
Dylan Pahman
Dylan Pahman is a research fellow at the Acton Institute for the Study of Religion and Liberty, where he serves as managing editor of the Journal of Markets & Morality. He is also a fellow of the Sophia Institute: International Advanced Research Forum for Eastern Christian Life and Culture. Follow him on Twitter @DylanPahman.
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3 replies to this post
  1. Quote: “My wife and I have a child, and we intend to have more if possible. But what inheritance will my son receive?”

    It’s a policy of despair, and I hope it never becomes necessary, but there is an option that other groups have adopted and taught their children. I heard a successful software developer tell how his Jewish-European family taught it to him. I saw the same attitude in Finnish college students I met at the height of the Cold War.

    It’s not to be the sort of internationalist that G. K. Chesterton rightly condemned as “loving every country but their own.” It’s just a recognition that we can’t fully control the world in which we live, that we will always be pilgrims here. In the case of parents rearing children, it means making sure they have the skills to adapt to any place in the world where they may find themselves. That’s particularly important in the light of the growing persecution of religious people over our culture’s sexual madness.

    That means adaptability, a knack for at least one or two other languages, and an exposure to other cultures that means they feel and home there. And it means having job skills that other countries will want and that are readily transferable.

    The Jewish software developer I met had been taught that a demanding education open doors into other countries. Historically, other Jews have been in the diamond industry. Why? Because if your assets are in real estate, you’ll be impoverished if persecution comes. If those assets are in warehouses filled with clothing, you can’t take that with you either. But concealed on your clothing or in your luggage you can transport a fortune in diamonds across unfriendly borders.

    The ability to blend in also matters. I read a book by a leading Chinese dissident who flees persecution and later becomes a Christian. The key to his success was that, although highly educated, he liked and knew how to blend into to the hundreds of millions of Chinese peasants who live in farming villages. He could disappear when many of his fellow, college-trained dissidents could not. Don’t just have good skills. Have skills that let you disappear.

    And having that option to flee, as Jesus advised the early church, doesn’t mean that we shouldn’t fight the battles that mean we don’t need to flee. It’s wrong as believers to have a Homeland (capitalized) because our real home is in heaven. But it is acceptable and good to have a homeland in a smaller sense, meaning a nation and a culture in which we feel at home and to which we are committed.

    To do otherwise is to enter the self-focused world of the internationalism that Chesterton condemned and that remain with us today. In practice, it become nasty blend of ever-widening circles of regimentation from the EU’s bureaucracy to the World State of H. G. Wells. And yet at the same time it creates no love for or loyalty to any particular region or nation.

    One of Chesterton’s great insights is that we as people seem ill-adapted to generalized loyalties. We need a particularized adaptation of them. It’s why people rarely remain at a generic level like C. S. Lewis’s mere Christianity.” They move on to a particular adaptation of it. It’s why global bodies like the League of Nations and the United Nations accomplish little. It’s why those weird little nineteenth-century utopia societies with communal marriage died off. We love specifics not generalities.

    It’s why someone who talks a lot about loving humanity often doesn’t like people.

    In short, raise children who love the particulars of their lives, but have particulars (mostly religious) that they can take with them should the society in which they live become impossible.

    –Michael W. Perry, editor of Chesterton on War and Peace

  2. It is one thing to despair of the future, it is quite another to realize that building barricades in the face of a tsunami is not an exercise in intelligence. When a tsunami is already incoming, one gets the hell out of the way. However, for all the handwringing I hear, I do not believe a monster wave is about to destroy Western Civilization. Therefore, not counseling despair, I would urge working as one sees fit, not to avoid disaster, but to attain a better world. The difference in mindset is all important.

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