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The general problem of the social assistance concept is the eligibility issue. Conditions are very restrictive, and so they should. Too much benefits would lead people into thinking that the Government will provide for them, at the expense of others, which is not what politicians desire (maybe communist rulers do, but this is not the object of this paper). On the other hand, few benefits or no benefits at all would mean that the purpose of the program - i.e. social protection - is not achievable.
One other aspect of the way U.S. citizens (and people from other countries, for that matter) look at the social assistance programs is the stigmatization such a program brings to an individual. No one likes to admit that he/she is in desperate need of help, so people are reluctant to apply. Perhaps some media campaigns against that perception would make a difference.
Another method would be to apply negative income taxes. Canada has such a program, based on the income statements a person submits. It basically involves paying an additional sum to an individual according to the needs the Government feels that that particular individual has. Still, this is a very bureaucratic approach, as money is needed when poverty strikes, not at the end of the fiscal year.
The researchers who have studied the differences between the American and the European welfare system have arrived to not so flattering conclusions for the United States system. The American welfare state is smaller than its European counterparts when it comes to percentages of the Gross National Product spent on social welfare. It seems to be less inclusive and generous, but more fragmented. Social programs have been reluctantly received by the American people and although some initiatives have imposed themselves, there are many core social programs that have never materialized.
The explanations offered for this phenomenon are impressive, at least at a scholarly level. However, all these debates were not followed by any actual application, due to the lack of governmental capacities. Researchers define the welfare state as an instrument of social control or of social betterment, a part of the state or a stage of development of capitalist countries, a minimal social insurance for the middle classes, safety net for those in need, or, in a very general way, everything that the government does to improve the well-being of individuals and families. The definitions do not include elements such as how the goals are to be achieved, or what is the form that these goods and services must take in order to accomplish the desired objectives.
Many countries, and the United States are a notable example, rely on indirect spending in order to promote social welfare, along with other various direct and indirect tools. Tax expenditure, for instance, is the most important form of indirect social spending in the United States, and is accompanied by loan guarantees for education and housing programs. Such programs give a sample of how large and complex the American welfare state really is.
The Congress has typically been presented as an impediment to the American welfare state. This assumption is based on the fact that the authority in the Congress is extremely fragmented and that the historical prominence of conservative southern Democrats often dilute or block social welfare legislation. As far as public opinion is concerned, it would seem that support for social welfare policies in the U.S. have generally remained stable and solid form the 1970s to this day, despite serious increases in opposition to income maintenance and related "welfare" activities. Americans, who traditionally do not favor social programs, have rejected cuts in welfare programs and have lately manifested their support toward such initiatives.
Social welfare programs around the world generally have the same structure as the one applied in the United States. The most advanced programs in the world are those put in practice by the European countries, and especially by Scandinavian nations, such as Sweden, Norway or Denmark. Europe is well-known for its propensity towards rest and relaxation, when compared with the United States or Asian countries, such as Japan. Sometimes, one could ask where does all the money come from. The French, for instance, have intensive social welfare programs, and they are not too keen on working. Higher taxation and no growth are the characteristics of most European countries, especially because of these social programs.
After all, Americans are reluctant to give a large part of their income in order for some other people to benefit from it. For people in Sweden this is the normal way of life. There are now a lot of immigrants who are completely satisfied with receiving social aid from Swedish authorities and not working. Still, such policies are not acceptable.
It is obvious that each country has its own particular social security legal provisions, and the systems vary, but not so wildly as to be completely different. As far as public opinion is concerned, most people act like the Americans: they support welfare programs when recession strikes, but do not encourage them in times of economic boom. No surprise here.
In most countries, a major part of the cost of social security is paid for by employers and employees, with proportional contributions. These contributions may be divided equally between them, except for the cost of the occupational injuries schemes, which is normally a task for the employer. In other cases, the employer could pay up to twice as much as the employee does. Most national legislations provide a ceiling, or a level of earnings beyond which the contribution becomes flat-rate, although Sweden or Switzerland, for instance, do not apply this principle. The maximum varies from around 50% above average earnings (France, Italy or Ireland) to twice the average earnings (Germany, the United Kingdom, or the United States, for that matter). Some countries, such as Norway, go even higher.
Some portion of funding is met by taxation. The taxes normally fill the gap between the amount of contributions and the proceeds available for this endeavor. Most Western European countries tried in the 1970s to shift the burden of financially supporting social security programs from employers onto taxes (Ireland, Denmark, Portugal, the Netherlands, Italy and the United Kingdom) or to employees (France, Germany and Austria).
There are also isolated cases where taxation does not cover even a small part of the costs of social welfare programs: Ethiopia, Malaysia and Singapore are such examples. At the other extreme are the countries in which most of the costs are covered by taxation and only a few are supported through contributions: Denmark, Australia and New Zealand are such countries. The United Kingdom finances its programs half with taxes and half with contributions.
The percent of Gross National Product allocated to social security expenditures is much higher than it was in the first half of the 20th century and there is a significant difference between developed and developing countries. Sweden spends about 32% of its GNP on social security programs, Belgium, France, Denmark, and the Netherlands between 25 and 30%, Austria, Germany, Norway, Ireland or Luxembourg between 20 and 25%, while Australia, Japan, New Zealand, the United States or the United Kingdom barely exceed the 10% level. High costs usually go hand in hand with high levels of social security benefits and with costly systems of providing health care. Some countries have permitted health care costs to continue to rise because of the capacity of this sector of the economy to provide for jobs and avoid high rates of unemployment.
The principle one could draw from analyzing this data is that, on an international scale, social security spending varies in direct proportion to the respective standard of living: the more affluent the country is, the more it spends on social security. The proportion of elderly people in the population is also a factor that needs to be observed. Another variable is the time period when the legislation was introduced. High spenders apparently introduced social program in a very early stage.
Exceptions are always close by: Japan and the United States have high standards of living and a high proportion of elderly, compared to the low budget they have for social security, while New Zealand spends very few if we consider the fact that pensions were introduced here in the 19th century.
Global perspectives are not really something to debate, since all countries have specific problems, specific concepts about those issues and very particular methods of solving those problems. The Swedish model is completely opposite to the American model, although both systems try to obtain the same thing: protect the needy. The philosophy that works so well in Sweden could never be imported to America, simply because people would reject it without giving it a second thought. Therefore, globalization in the area of social security will be possible, if ever, only gradually, and along with the uniformity of the peoples' needs and ways to act.
There have been numerous debates…[continue]
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