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HappySqurriel said: http://www.tcsdaily.com/article.aspx?id=082806E If you have a society where there is perfect equality, and earns a uniform wage, then there is no incentive to invest your resources (physical, emotional, intellectual or financial) towards making society better because there is no reward. On the other hand, if you have a society where there is perfect inequlity, and your wage is entirely based on arbitrary considerations (race, class, caste, or political connections), then there is no incentive to invest your resources (physical, emotional, intellectual or financial) towards making society better because there is (once again) no reward. What society needs is a good balance of equality (an elimination of arbitrary barriers that prevent people from achieving their goals) and inequality (a reward system which benefits those people who make personal sacrifices in order to benefit society). The best way to measure whether one system was "Better" than another at achieving this would be to determine where the economic growth was the fastest, because that would mean that there was the greatest incentive for people (on the whole) to benefit society. I have yet to see any statistics that demonstrate that over a reasonable period of time (20+ years) a welfare state can produce faster economic growth, unless the welfare state began at a much lower economic level. |
You cannot directly compare income levels the way the author of that article does. There are too many variables that affect quality of life. For instance in the US a minimum wages worker has to spend a significant amount of his income on things like health care and education. In Finland quality health care and education is free. Thus a finnish worker can survive on a smaller income.
The only scientific way of telling in which country the poor are better off, is to compare things like life expectancy and infant mortality rates. And if you do, Finland comes out much better than the US. For instance the infant mortality rate is twice as high in the US.
As for the rest I actually agree with a lot of what you write. Except for the following:
"The best way to measure whether one system was "Better" than another at achieving this would be to determine where the economic growth was the fastest, because that would mean that there was the greatest incentive for people (on the whole) to benefit society."
You sound like Milton Friedman. The obvious problem is that there's a *lot* we can do to improve the economy that we aren't doing, simply because doing so will massively increase suffering in society. We can legalize slavery. We can legalize child labour. We can kill everyone above the age of 60. But would that give us a "better" system ?
"I have yet to see any statistics that demonstrate that over a reasonable period of time (20+ years) a welfare state can produce faster economic growth, unless the welfare state began at a much lower economic level."
Norway ?
http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal)_per_capita
http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita
Besides, the US is extremely rich in natural resources compared to most other developed countries. This obviously gives the US an edge. Then there's the advantages of being the biggest country in the developed world, which is the main reason for the US dollar's dominant position in the world economy. You shouldn't be so quick to assume libertarian ideas are the primary reasons for the US success. Milton Friedman and his "Chicago Boys" were given more or less free reign in fascist Chile from 73-90, and contrary to popular libertarian myths, it did little for the economy.
http://en.wikipedia.org/wiki/File:GDP_per_capita_LA-Chile.png
