Rise and fall of the welfare state


Now, that we have just celebrated sixty four years of Pakistan’s existence, the ideal and practical realities of its creation are not to be forgotten. A just and progressive society is only possible to be built on principles of fairness and an assurance for all the people of being provided an equal opportunity to strive and prosper. The trends of economic backslides in the developed economies have raised considerable cause of concern and worry.
The very idea of welfare state took its modern outlook in the country that is in the throes of dealing with the worst kind of rioting and looting in the streets. It is not that the upheaval in Tottenham erupted because it has the highest unemployment in London, as the reasons are far more complex. No doubt that the budget for youth clubs was cut by 75 per cent in areas where the riots took place, but for many months now the closure of the Africa Centre in the neighbourly Covent Gardens, the central district of London, was becoming a contentious issue.
The place is not now visited by many but for many years, people who wanted to know the left or right of the culture of the continent gathered there for meetings. Its proposed sale sent down a wrong signal to a class of society that felt they were being left to the rigours and harshness of the market economy.
The prime minister categorically stated in the parliament at Westminster that it was ‘culture and not poverty’ which was the reason for the eruption. May be he is partly right. The ‘glass ceiling’ was never palpably visible but the economic worries of dealing with growth patterns have injected a myriad of colours in to the air. The post-cold war liberalism in economic thought has begun to raise high barriers not just between different strata of society but between different sectors of economy.
The post-modern tendency to deconstruct every phenomenon to its bare minimum has disjointed the harmonious intermingling and linkages of various sectors of economic activities. When the concept of modern welfare state was really maturing, the world had not yet become overcrowded. The traffic flowed smoothly in all big cities of the world. The icecap right down to Canada remained intact and did not even melt in the summers. The industrial revolution had begun to produce goods in large quantities and at prices the emerging middle class could afford to buy. But the new economic thinking, ironically calling itself the new liberalism, has started to destroy the very basis on which the model of the welfare society was built.
The third world countries were continually reprimanded for not providing clean drinking water, health facilities and a modern sewerage system to its people. The developing economies followed the ‘model’ in letter and spirit. No deviations, changes or improvements were permitted as per local customs, traditions or ground realities. ‘We know what is good for you,’ the international donor agencies or countries breathe down the necks of developing economies even at a time when the basic principles of all modern economics have been made to stand on their heads in their own marketplaces. In the developed economies, the model is showing signs of internal fatigue.
The economies are finding it difficult to meet the financial needs of paying pensions and other social welfare benefits like medicare. The immigrant classes continued to provide the necessary input of labour to keep the wheels of economy moving. Now that some of the immigrant class has acquired higher education and is professionally qualified to fill the better paid jobs or that others have established their businesses, the population balance in the economic ladder has begun to shift.
There have been rulers in different countries in all continents where people were happy, contended and felt safe when they travelled to farther parts of their countries. The pieces and examples from this jigsaw puzzle were carefully picked up and sifted to formulate the principles of a welfare state. The democratic and civil society evolved to give us the rudiments of the welfare economy. The model survived two great wars, many economic depressions and upheavals but surprisingly after the collapse of the Berlin wall in 1989, it could not absorb the heat of the great thrust forward of the increased financial flows generated by the fast developing economies, especially in the Asian region. The emerging markets are learning lessons from the leading economies of the world that large disparities in incomes lead to a chaos in the marketplace. e Asian economies shall and must build a better model of a welfare state.

The writer has served as consultant to the United Nations and other developing economies on issues of trade and development and can be reached at [email protected]