Friday, November 23, 2012

Social Policies are Anti-Social

"The social model actually produced some rather anti-social results. Many state interventions create problems, and indeed in a globalised world of rapid change, they protect the old and block the new. They hamper creation, entrepreneurship and work. [...] many policies were launched simply to apprease special interests, not to benefit society as a whole."

When writing those lines in his book "The Guide To Reform", Johnny Mukhammar described the negative effects of welfareship in his own country: Sweden. But they are the same in any welfare states.

When unrestrained and implemented on the long run, welfare policies have three typical negative effects:
  • they end up being anti-social
  • they destroy incentives to create wealth
  • they favor special interests
That is why Members of Parliament should always be cautious when passing welfare bills.

Monday, November 19, 2012

Madsen Pirie: How a Think Tank Can Influence Events

Madsen Pirie, co-founder of the Adams Smith Institute, based in London, was in Paris on November 16th, at the Institute for Research in Economics and Fiscal Issues. Madsen worked with the British Prime Minister Margaret Thatcher and influenced the reforms implemented in the United Kingdom in the 1980's. 

Madsen Pirie and Sylvain Charat
We had the pleasure to hear Madsen sharing his experience on the works and influence of think tanks. Here is Madsen's short summary of his Parisian speech:

"What a think tank should not do.  It is not, and should not behave like, a political party.  It does not stand for election, take decisions, or implement legislation.  It tries instead to advise those who might listen.

It is not like a business, in that people do not buy its product.  It should develop and explain its ideas, and seek support from anyone who approves of what it does.  It should not be a lobbyist for particular businesses or sectors, or its ideas will be discounted as representing only a commercial interest rather than the public good.  A think tank should not solicit funds by offering to introduce lobbyists to ministers.

It should not tie itself to any particular politicians, because politicians go down as well as up, and some have quite short sell-by dates.  While closeness to a politician might bring immediate attention, it is not a formula for long-term influence.  A think tank should beware of depending on public funds, local, national or European, or it will find itself serving the interests of its paymasters.

What should it do?  My answer was that it should be independent and seek to influence events by influencing thinking.  One that can change the intellectual climate can ultimately change the policies that result from that climate."

Madsen's book: "Think Tank, The Story of the Adams Smith Institute"."

Sunday, November 18, 2012

Reducing Public Spendings: No Way!

Jérôme Cahuzac, who is the Minister of Budget in the socialist French Government, was asked last week why he decided to raise taxes rather than reducing public spendings. 

Jérome Cahuzac
Cahuzac's answer was clear: "The economic theory demonstrates that, in the short term, reducing public spendings has more recessionary effects than a tax increase".

We could not have a clearer definition of the socialist economic mindset: public spendings and tax increases are a necessary good for the economy... but above all necessary to maintain welfareship.

Wednesday, November 14, 2012

Three Conditions for Welfareship

Welfareship is reached when three conditions are gathered in a country: 
  1. when the Government is controlling directly or indirectly the whole lifestyle of its citizens, including education, work, health, retirement, vacations, etc.;
  2. when, in the name of the common good, 100% of the citizens are part of the system willingly or not; 
  3. when this system is implemented and preserved through democratic elections.
Once a welfareship is reached, it should be noted that individual sovereignty and rights will slowly be yielded to the collective good. Voluntary contributions and help to others, called charity, are replaced by compulsory contributions and Government-organized distribution in the name of solidarity.