A Living Room Elephant

The economic problems of the world are becoming more difficult to understand--or perhaps the reaction to the problems are. The standard debate is over debt, taxes and spending, sometimes with the spice of bailouts added. The focus varies. In Greece the threat of austerity is met with riots led by unions fearful their benefits might be sacrificed. In the U.S. the concern is over the debt and the taxes necessary to combat it. In Germany the country has followed a frugal course and has set its collective square jaw against inflation and, indirectly, the debasing of the Euro. All of these problems, though, stem from a basic notion common to all and somehow immune to question: The concept of the Welfare State.

The problems of overspending and debt are the direct result of foolishly promising more money to people in various benefits than they put in. Their citizens are certainly complicit in this but not much. They thought they were trading for these benefits. Those that were asking for something for nothing were just being Keynesian. A program like Social Security or Medicare, as much as the politicians seeking cover might pretend, is not an entitlement program; the citizens who put money into these programs, as required by law every year of their working lives, thought this contribution was an investment in their future and expected the principle to be there when they needed it. They even expected a little interest as well. So confident were they in these political promises they did not save for retirement or medical insurance as much as they otherwise might have. Now the promises have landed. The citizens, unions and public workers want their money; they want their promises fulfilled. The citizens voted on these promises and gave their money, the union worker eschewed his raise and signed his contract. The politician now condescendingly asks which benefits the citizens want to cut, as if it is their fault. All of these unrealistic promises, all of these economically unfeasible notions where a decreasing work base could pay for a larger retired group, all of these unfounded and untried theories have resulted in the current crisis of many people waiting with heightened expectations for a check that will never come.

What is so amazing is their patience and their goodwill. I have not read a single furious letter, seen a single angry sign protesting this outrageous insincerity. The closest rebellion is the attack on incumbents in the U.S. and that rebellion is only a few months old, is emotional and diffuse, and may well not last. Indeed most people want to reestablish the same problem; they want a "rescue" using the same nonexistent money, a guarantee of that which cannot be guaranteed and will never be delivered.

We are obsessed with effect; we apparently have no head or heart for cause.