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+--- Thread: What are the unintended consequences of government social insurance programs? (/thread-50813.html)
What are the unintended consequences of government social insurance programs? - Man - 12-13-2012 06:47 PM
From an Australian perspective, ie medicare, pensions and the dole.
Is there any terms or ideas that prove correct for all government insurance programs? (For instance, i know the dole creates the incentive for people to work less sometimes, is there any incentive or externality that is created by all social insurance programs??)
^If you can't understand my wording, just answer the main questions! Thanks!
- Meg - 12-13-2012 06:55 PM
They make people docile, for example the oil rich countries in the middle east, which enables authoritarian government to control the population. It is not an accident that the "Arab Spring" died out in the countries with oil wealth however I am not sure that this effect is unintended.
- SDD - 12-13-2012 06:55 PM
I'm not sure they're actually unintended, but one result is that you get fewer people saving and taking responsibility for themselves because they know they can simply take from others when needed.
- Anjaree - 12-13-2012 06:55 PM
A group of German economists in Freiburg has developed a concept of a social market economy exactly to explain your point. Why we need social safety-net in a capitalist society. In layman term, a competition will cause looser as well as efficiency.Looser has to feed their family,kids have to go to school,wife has to go shopping. They have to move on. But how? New business,or to get a decent job can not be achieved overnight.It is the role of the state to take care of them, because it might hamper development and trigger the social unrest.The US has lower safety-net than Europe,because some people think the program might make Americans too lazy to go back to work.It had been lucky until 2008.But now unemployed persons have been increasing, and the duration of job seeking is expanded to over a year.That is part of the debts and deficits which are the main concern right now.