Rethinking the welfare state
By The Economist
From The Economist
Published: October 02, 2012
Countries across the continent are building welfare states—with a chance to learn from the West’s mistakes.
Sep 8th 2012 | from the print edition
ASIA’S economies have long wowed the world with their dynamism. Thanks to years of spectacular growth, more people have been pulled from abject poverty in modern Asia than at any other time in history. But as they become more affluent, the region’s citizens want more from their governments. Across the continent pressure is growing for public pensions, national health insurance, unemployment benefits and other hallmarks of social protection. As a result, the world’s most vibrant economies are shifting gear, away from simply building wealth towards building a welfare state.
The speed and scale of this shift are mind-boggling (see article). Last October Indonesia’s government promised to provide all its citizens with health insurance by 2014. It is building the biggest “single-payer” national health scheme—where one government outfit collects the contributions and foots the bills—in the world. In just two years China has extended pension coverage to an additional 240m rural folk, far more than the total number of people covered by Social Security, America’s public-pension system. A few years ago about 80% of people in rural China had no health insurance. Now virtually everyone does. In India some 40m households benefit from a government scheme to provide up to 100 days’ work a year at the minimum wage, and the state has extended health insurance to some 110m poor people, more than double the number of uninsured in America.
If you take Germany’s introduction of pensions in the 1880s as the beginning and Britain’s launch of its National Health Service in 1948 as the apogee, the creation of Europe’s welfare states took more than half a century. Some Asian countries will build theirs in a decade. If they get things wrong, especially through unaffordable promises, they could wreck the world’s most dynamic economies. But if they create affordable safety nets, they will not just improve life for their own citizens but also become role models themselves. At a time when governments in the rich world are failing to redesign states to cope with ageing populations and gaping budget deficits, this could be another area where Asia leapfrogs the West.
Beyond Bismarck and Beveridge
History offers many lessons for the Asians on what to avoid. Europe’s welfare states began as basic safety nets. But over time they turned into cushions. That was partly because, after wars and the Depression, European societies made redistribution their priority, but also because the recipients of welfare spending became powerful interest groups. The eventual result, all too often, was economic sclerosis with an ever-bigger state. America has kept its safety net less generous, but has made mistakes in creating its entitlements system—including making unaffordable pension and health-care promises, and tying people’s health insurance to their employment.
The record in other parts of the emerging world, especially Latin America, is even worse. Governments have tended to collect insufficient tax revenue to cover their spending promises. Social protection often aggravated inequalities, because pensions and health care flowed to affluent urban workers but not the really poor. Brazil famously has a first-world rate of government spending but third-world public services.
Asia’s governments are acutely conscious of all this. They have little desire to replace traditions of hard work and thrift with a flabby welfare dependency. The region’s giants can seek inspiration not from Greece but from tiny Singapore, where government spending is only a fifth of GDP but schools and hospitals are among the best in the world. So far, the safety nets in big Asian countries have generally been minimalist: basic health insurance and pensions which replace a small fraction of workers’ former income. Even now, the region’s social spending relative to the size of its economies is only about 30% of the rich-country average and lower than any part of the emerging world except sub-Saharan Africa.
That leaves a fair amount of room for expansion. But Asia also faces a number of peculiarly tricky problems. One is demography. Although a few countries, notably India, are relatively youthful, the region includes some of the world’s most rapidly ageing populations. Today China has five workers for every old person. By 2035 the ratio will have fallen to two. In America, by contrast, the baby-boom generation meant that the Social Security system had five contributors per beneficiary in 1960, a quarter of a century after its introduction. It still has three workers for every retired person.
Another problem is size, which makes welfare especially hard. The three giants—China, India and Indonesia—are vast places with huge regional income disparities within their borders. Building a welfare state in any one of them is a bit like creating a single welfare state across the European Union. Lastly, many Asian workers (in India it is about 90%) are in the “informal” economy, making it harder to verify their incomes or reach them with transfers.
Cuddly tigers, not flabby cats
How should these challenges be overcome? There is no single solution that applies from India to South Korea. Different countries will, and should, experiment with different welfare models. But there are three broad principles that all Asian governments could usefully keep in mind.
The first is to pay even more attention to the affordability over time of any promises. The size of most Asian pensions may be modest, but people collect them at an early age. In China, for example, women retire at 55; in Thailand many employees are obliged to stop work at 60 and can withdraw their pension funds at 55. That is patently unsustainable. Across Asia, retirement ages need to rise, and should be indexed to life expectancy.
Second, Asian governments need to target their social spending more carefully. Crudely put, social provision should be about protecting the poor more than subsidising the rich. In fast-ageing societies, especially, handouts to the old must not squeeze out investment in the young. Too many Asian governments still waste oodles of public money on regressive universal subsidies. Indonesia, for instance, last year spent nine times as much on fuel subsidies as it did on health care, and the lion’s share of those subsidies flows to the country’s most affluent. As they promise a broader welfare state, Asia’s politicians have the political opportunity, and the economic responsibility, to get rid of this kind of wasteful spending.
Third, Asia’s reformers should concentrate on being both flexible and innovative. Don’t stifle labour markets with rigid severance rules or over-generous minimum wages. Make sure pensions are portable, between jobs and regions. Don’t equate a publicly funded safety net with government provision of services (a single public payer may be the cheapest way to provide basic health care, but that does not have to mean every nurse needs to be a government employee). And use technology to avoid the inefficiencies that hobble the rich world’s public sector. From making electronic health records ubiquitous to organising transfer payments through mobile phones, Asian countries can create new and efficient delivery systems with modern technology.
In the end, the success of Asia’s great leap towards welfare provision will be determined by politics as much as economics. The continent’s citizens will have to show a willingness to plan ahead, work longer and eschew handouts based on piling up debt for future generations: virtues that have so far eluded their rich-world counterparts. Achieving that political maturity will require the biggest leap of all.
from the print edition | Leaders
為全民撐起社會福利的大傘
2012-09-19 天下雜誌 506期 作者：經濟學人
亞洲國家正朝「福利國」快速轉型，但西方過去犯的種種錯誤，請謹記在心。
隨著生活日漸富裕，亞洲各國公民要求提供年金、全民健保、失業救濟金等，社會保障措施的呼聲愈來愈高。使得這個全球成長動力最足的區域，逐步換檔，從原先專注創造財富的衝刺跑道，轉到福利國的軌道上。
這個轉變速度之快，頗引人再三思索。去年十月，印尼政府承諾從二○一四年開始，提供所有國民健康保險，並將成為全球最大的單一全民健保經營者。
這兩年來，中國大陸則讓兩億四千萬農村民眾獲得養老金的保障，比美國參加社會保險的人數更多。幾年前，八成的農村居民，根本沒有健康保險，但現在已經頗為普及。
在印度，已有約四千萬戶人家，獲得政府提供每年一百天的工作，並有最低工資的收入保障。此外，該國的健康保險也擴及一億一千萬個窮人，比美國沒任何保險的人數，多出一倍有餘。
如果把德國引進年金制度的一八八○年代，看作是福利國的開始，而把英國實施全民健保的一九四八年，視為巔峰，則歐洲的福利國制度，花了超過半世紀才逐漸成形。
高齡化、大量人口的難題
然而，某些亞洲國家卻會在這十年內，就建立起他們的福利制度。如果他們重蹈歐洲的覆轍，特別是承諾給人民一個養不起的未來，則將毀掉其活力十足的經濟。
但只要他們能創造出負擔得起的社會安全網，則不僅能改善國民的生活，更可以成為成功的樣板。
在這個西方國家忙著重新改造制度，以因應人口老化、彌補預算赤字的年代，亞洲的福利國革命，可能會成為亞洲跳躍式成長的另一例證。
以史為鑑，可以讓亞洲國家避開歐洲過去的錯誤。
許多亞洲國家模仿的對象，不是希臘，而是新加坡，只提供基本的健康保險，和收入替代率有限的年金。雖然新加坡政府支出僅佔國內生產總值（GDP）的兩成，卻有全球數一數二的教育和醫療水準。
但亞洲也面臨一些棘手的挑戰，其中一個就是高齡化。此外，福利制度在中國、印度、印尼等人口大國的實施難度很高。而且，因為這些區域有太多地下經濟，很難把稅收齊，確保福利支出有穩定的收入來源。（林昭儀譯）
留言列表
高普考補充資料 (3)
