Cutting the Gordian Knot:
Replacing the Welfare State with a Guaranteed Income
Progress Foundation and AIER
26th Economic Conference
24 April 2008
American Enterprise Institute
Washington, DC, USA
The backdrop for tonight’s presentation is a train wreck in slow motion that we have been watching approach for the last few decades and that is now only a few decades away from happening. I refer to the end of the welfare state as we have come to know it. Everywhere, it is approaching financial and social collapse.
The looming financial disaster is the most obvious part of the problem. For the EU countries, the calculus is quite simple. The benefits of the advanced European welfare states require taxes from working-aged citizens. You haven’t been producing enough working-aged citizens from among your native populations, so you’re going to have to accept massive immigration. This could conceivably work if Denmark, let’s say, had massive immigration of Norwegians. But Denmark cannot remain Denmark if the massive immigration consists of Albanians, Nigerians, or Iranians. The cultural consensus that allowed the welfare state to work as long as it did is too deeply embedded in the cultures that produced it. Forget Albanians, Nigerians, or Iranians. The Danish welfare state wouldn’t work if there were massive immigration of Italians or Poles. And that leads me to what I meant when I said that the welfare state everywhere is within decades of social collapse.