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An Erstwhile Socialist Calls for an Overhaul of the Welfare State


Previously published in The London Free Press, February 3rd, 1998


Rory Leishman

 Author Notes

Freelance journalist, author of a weekly national affairs column for The London Free Press and Sun Media Newspapers in London, Ontario. Mr. Leishman's work also appears in various other journals, and he operates his own web site where others of his essays can be viewed. He can be reached via e-mail at rleishman@home.com.

 Essay - 2/3/1998

A neo-conservative is not just a liberal who has been mugged by reality: More and more erstwhile socialists are also finally beginning to grasp the sundry disasters brought on by the unintended consequences of the welfare state.

John Richards is a case in point. From 1971 to 1975, he served variously as a legislative secretary in the NDP government of former Saskatchewan premier Allan Blakeney and as an independent socialist in the Saskatchewan Legislature.

Today, Richards is an economist at Simon Fraser University and an adjunct scholar of the C. D. Howe Institute. In his latest book, Retooling the Welfare State: What's Right, What's Wrong, What's to Be Done, he ruefully recalls the old saying that, "If you are not a socialist before age 40, you have no heart; if you are still a socialist after 40, you have no brains."

This is not to suggest that Richards now qualifies as a full-fledged neo-conservative. Far from it. He still holds that, "The welfare state is a good thing."

In support of this naive belief, Richards argues that, "Government social policies matter. Look at income distribution. Progressive taxation and other social policies explain the much higher share of income accruing to the bottom quintile (the poorest fifth of the population) in Sweden than in the United States."

What, though, is so good about a more equal distribution of incomes? Is not envy one of the seven deadly sins? What about the adverse impact of income redistribution on poverty-reducing economic growth?

Richards concedes that the crushing levels of taxation needed to achieve a more equal distribution of income have probably contributed to the relatively slow pace of economic growth in Sweden over the past quarter century. By 1995, GDP per capita was more than 30 per cent lower in Sweden than in the United States.

Richards also acknowledges that there is a tradeoff between income redistribution and unemployment. It's no coincidence that relatively egalitarian countries like Sweden and Canada have substantially higher unemployment rates than the less egalitarian United States.

Chronic unemployment is a serious problem -- especially for fathers. Those who habitually rely on generous unemployment insurance benefits or the dole instead of earning a living for their family are prone to depression, alcohol abuse and violence. Quoting a ballad by the Quebecois songster Felix Leclerc, Richards holds that, "The best way to kill a man is to pay him to do nothing."

The worst unintended consequence of generous welfare benefits has been a calamitous increase in the number of children living in fatherless families. By 1992, nearly 15 per cent of Canadian children did not have a father in their home and more than half of these families had low incomes.

Feminists are apt to ask: apart from poverty, what's wrong with single motherhood? Richards knows the answer: Recent research has demonstrated that regardless of family income, children usually thrive better under the care and guidance of both their natural father and mother.

What, then, should be done to curb the poverty, unemployment and family breakdowns caused by the welfare state? Richards recommends a substantial cut in welfare benefits.

Using Saskatchewan as an example, he has advised the province to reduce welfare support for a single parent with one child by $1,600. That would cut the total to $9,000 -- almost $2,500 below the current level in Ontario.

Richards would have the provinces redirect the savings from welfare cuts to a substantial increase in earnings supplements for low-income parents. This is a sound proposal. Unlike federal child tax benefits, it would target increased support on the working poor, while reducing benefits for parents who rely on welfare.

In this way, notes Richards, his plan, "would lower the financial incentive for women to undertake single parenthood voluntarily and increase the financial incentive for low-income fathers to form two-parent households in order to maximize the supplement."

That would be all to the good, but would even a major hike in income supplements for working parents do much to reduce unemployment and shore up the natural family? United States President Bill Clinton doesn't think so. That's why he signed into law a bill that has abolished welfare in favor of workfare and limited most able-bodied recipients to a lifetime of no more than five years on the dole.

There are many interesting reform ideas in Richards' book. Now that he is over 40, it's evident that he has both the heart and brains needed to come up with compassionate remedies for the manifold failures of the welfare state.

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