Does good social welfare make lazy people?
Social insurance, and especially unemployment insurance, is the most criticized aspect of the social welfare system, because it affects willingness to work. Not only does it lower the willingness of high income earners to work, even the desire of low income earners to work declines.
Wu Hui-lin, a researcher at the Chunghua Institution for Economic Research, feels that this is just human nature. "People by nature like things easy, and find labor abhorrent. Once they have a chance for a free lunch, who's going to pass it up?"
Chan Huo-sheng, a professor in the Department of Sociology at National Taiwan University, opines that "a good social welfare system should be one that does not encourage laziness, and one that does not turn idleness into dependency." This problem must be carefully considered in designing policy.
Research suggests that laziness will only be encouraged in a situation where the work ethic is weak and the level of guarantees in social welfare is high. According to this logic, if methods are found to strengthen the work ethic, and the level of social services only provides a minimum quality of life, then laziness will not be the result.
A fiscal crisis?
Because Taiwan already has a budget deficit, with revenues running behind outlays, where will the resources for social welfare come from? Will the fiscal burden be worsened? Could it lead to fiscal collapse?
Today, expenditures on social welfare account for 16% of all government spending, which is quite low compared to the 30-50% in other industrialized nations. Moreover, the deficit is by no means caused by social outlays. Thus, some contend that consideration should begin with the basic financial structure.
In terms of revenues, Lin Wan-yi believes that the current taxation system relies too much on direct taxation (deducting taxes from income), and too little on indirect levies (such as on property and inheritance). This greatly decreases the sources of tax revenue. Among direct taxes, it is the taxes on employees that are hardest to evade, so that most taxes are paid by the middle and lower classes. As a result it would be both unfair and very difficult to increase taxes there.
Cheng Wen-hui, a professor in the Graduate Institute of Social Welfare at National Chung Cheng University, adds that at present Taiwan has tapped into few tax sources, and with legal tax exemptions (for example, for teachers, or to encourage investment) and illegal tax evasion, tax revenues are extremely low, leading to inequities in taxation.
There are also many debatable aspects in terms of the distribution of expenditures. At present 25% of the national budget goes for defense and the military; 20% goes toward economic development; routine government administrative costs account for 10%; 15% is applied to education . . . . The remaining few percent is up for grabs among public health, agriculture, social welfare, religious, and other interests, naturally leading to the "squeezing out" effect.
Does it really not matter if nothing is done?
Perhaps implementing social welfare will have its down side, but if it is not adopted, our society could pay a considerable price. If social resources are poorly distributed, this could contribute to many social problems. Chan Huo-sheng argues that Taiwan has focussed too heavily on economic development over the past 20-30 years, while relations between people have deteriorated and social problems have multiplied, to that people feel a strong sense of insecurity.
Naturally, insecurity does not derive entirely from economic factors. Political instability or other factors can also generate insecurity. But taking the United States, which has great political stability, as an example, the excessive gap between rich and poor is one of the elements contributing to insecurity there. Compared to European nations, the United States devotes less to social welfare, while the amount required for crime prevention and medicine is comparatively larger.
Some scholars note that it costs money to implement social welfare, and it costs money to maintain social order, but many countries choose the preventative (the former) rather than choose the curative (the latter), because the latter has less chance of success.
Cheng Wen-hui notes that in fact our society already implements, in an invisible way, "income redistribution." He indicates that the excessive accumulation of foreign reserves has led to an excess of floating capital and rampant money games and speculation; land prices have skyrocketed and stocks have soared upward, so that the gap in income between rich and poor has become more pronounced. Polarization between the haves and the have-nots is increasingly acute, If this keeps up, not only will it erode the fruits of economic growth, it will severely warp the work ethic among young people.
Investing in people:
You can see from this that the development of "people" is critical. "For a country to be strong, it relies not on powerful weapons, but on high quality people," says Lin Wan-yi. Tp raise the quality of human capital, besides education and technology, raising the level of culture and guaranteeing social security are very important.
Chen Kuan-cheng relates the two major positive conditions for Taiwan as it plans a social welfare policy. The first is that the root problems underlying the fiscal crises in European and American nations have already been found, and we can avoid repeating the same mistakes. The second is that Taiwan has quite complete census data.
Chen points out that no more than ten other nations in the world have a compulsory housing registration system like that in Taiwan. "Since we already have the population data, we can get a handle on the future trends in the population structure."
Yet, we are also lacking a great deal of basic, objective data. For example, how many senior citizens actually will need medical care? How many elderly will require nursing home care? Chan Huosheng suggests that the most urgent task at the moment is not to draft legislation, but to do basic research.
A crisis of confidence?
How to appropriately draw up an efficient social welfare system that is suitable for local society is a major challenge. But there it yet another question about which people cannot feel at ease: Can it be implemented effectively? The goal of a social welfare policy is to reduce the gap between rich and poor and to reduce the occurrence of social problems, not to take more money and more manpower just to create more waste. The large deficits run up since the initiation of labor insurance and farmers' insurance give cause for concern.
Wu Hui-lin states his worries quite forthrightly: "Government agencies are corrupt and inefficient. If money is turned over to the government for this purpose, not only will it be employed inefficiently, ordinary people will have no way to oversee the process. So that's not as good an idea as allowing the people to save their own money and handle matters themselves."
Although the topic of social welfare has been talked up in the course of the election, leading to a cacophony of voices each with his or her own views, this has also been an excellent educational opportunity. It has allowed us to once again get to know what social welfare is all about, and to consider which path to take.
No free lunch:
The first thing that people must get straight is that, though social welfare may not be an impossible road to travel, it is not a panacea that will solve all problems. People must not have excessively high expectations of a social welfare system. Secondly, people must have an understanding of the relationship between their rights and their responsibilities. For example, it will probably be necessary to raise taxes. Tan Huo-sheng stresses: "Social welfare is not a 'free lunch.' It's not even an inexpensive lunch."
What deserves the attention of the government is that those scholars who advocate social welfare and the free-marketeers who oppose it have one thing in common: they both oppose a "hasty" or "crude" social welfare policy.
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With a sound social welfare system, the handicapped would not have so many worries. (photo by Diago Chiu)
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Is it an individual problem if the number of street people is large? Or is it a problem of inadequate care from society?
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While calls for "social welfare" fill the air, it is also necessary to build up the "civic culture" of concern for others; or else the best laid plans will be wasted.
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After the implementation of national health insurance, children, long seen as a "high-risk group," will no longer be "unwelcome clients" for health care.
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Who should take responsibility if children are not adequately cared for? (photo by Diago Chiu)
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Besides government social insurance, social welfare also requires more participation by private groups, The photo shows mentally handicapped children making box lunches at the First Children's Development Center.(photo by Diago Chiu)
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It is estimated that next year the percentage of persons aged 65 or over in Taiwan will be 7.1%.
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Child care has always been a big problem for working women. This problem could be eased or even resolved in a comprehensive social welfare system. (Sinorama file photo)