Next time we debate Social Democracy over dinner, I quote Paul K (over 18 only: update on the wine included)
Your correspondent wished he had Paul K by his side over the umpteenth dinner conversation about the compared merits and benefits of two slightly different proposals of social and economic infrastructures (coz that’s what we did for Xmas & NY break: drink*, eat, and rebuild ze world):
- On the one hand, a model mostly predominant in ‘Anglo-Saxon countries’ (although they tend to be offended by this broad generalizing label). A perceived low tax regime, limited provision of social services by the state: childcare, schooling, healthcare, etc tend to be outsourced to private ventures.
The guiding principle is “We don’t trust the government to spend my money on such services, and we would rather pay ourselves privates companies to do the job”.
This leads to a social infrastructure relying on a backbone of private schools, private childcare companies, private hospitals, etc. The more the people can go / afford private, the better for the State. The theory is that Public services remain available for those in need who cannot afford private.
- On the other hand a more ‘social-democrat’ European model where the state tries to honour a social contract by providing those services for all citizens (hence universal) and funds them thanks to taxes. (this is the cornerstone of the contract: those who do well share a bit with those in need.)
The ongoing argument steamrolled by the advocates of the “pro-private” model is that only a free-market approach can ensure economic dynamism. To put it in a more vernacular fashion: “Sure, it is a pain to face such high private fees, it might even seem a little bit unfair if you think about it too long, but hey.. isn’t life unfair anyway?”
Consider schooling in Australia as an example. (just to not take another US story). Apart from a few elite selective public schools where kids need to demonstrate outstanding results to get in, private schools are generally favored by a significant amount of those parents who put a strong priority on their kids academic performance. Fees are prohibitive.
To give a scale of comparison:
- Bear in mind that the average Australian salary is roughly $60,000 per year. Private Independent School Fees can range from $15,000 (that is 25% of annual average salary) to $25,000 (41% of annual average salary). Despite the cost, around 30% of students attend private institutions. To be fair, some catholic schools have fees of a couple of thousand of dollars, which make them more affordable. However the above numbers remain quite outstanding. What do they tell us about society’s sacrifice on the altar of private education?
- In France, the average salary is around 40,000 Euros (so same order of magnitude as in Australia) and public education fees amount to a few hundred dollars; mostly to cover stationaries and other ancillaries.
If imposed overnight in most continental European countries, no doubt 5-digit fees would trigger street protests. In fact some cabinets have lost power for less than that.
This is the mind-bugging aspect of this ongoing discussion: how the most impacted and affected audience – namely the everyday mainstream middle-class – reacts to this state of play. When challenged about it, a worrying number of parents (read: voters) who have to incur this cost literally fall in a sort of Stockholm syndrome.
They obviously suffer from the burden of private fees imposed by commercial ventures, but seem to see no other alternative on the horizon other than to adhere to this system and to pay for it as a fact of life. They tend to judge the performance of Government services quite harshly, and would rather eat peas, and go to debt in order to afford the cost of those private services. The distrust is such that while people can see the government’s effort to rebuild a world-class public education, they do not believe it will be done soon enough to benefit their kids. Instead they perpetuate the issue by sending them to the other side, when all the collective system needs is a massive influx of top performing students to raise the bar within years.
This is where the neo-liberal economists have really won the battle so far. Forget about Black Scholes or other Quant innovations (wired: The Formula That Killed Wall Street), forget about CDS and short selling practices, the real battle field is on main-street. The prize: the hearts and minds of the masses who won’t even comprehend that an other alternative is possible.
It might sound harsh, even a bit derogatory but that’s what we are up against…
Sure there is no silver bullet, and European education systems carry their load of unresolved issues, but you’d wish people would at least acknowledge that a choice does exist and would ponder NewYork Times’ editorialist Paul Krugman’ brilliant motto when comparing the US and European economies:
“Europe is an economic success, and that success shows that social democracy works. […] what European experience actually demonstrates is […]: social justice and progress can go hand in hand.”
http://www.nytimes.com/2010/01/11/opinion/11krugman.html
So there is an alternative. It starts with a vote.
{ NKN & leLaissezFaire }
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{ * } : The other debate that concluded in an unanimous draw was between a Vinea Marson, Nebbiolo, 2006 and a Petit Chablis (Chardonnay), 2005.
Both absolutely excellent quality/price.
The Nebbiolo is a red Italian wine grape variety predominately associated with the Piedmont region. Vinea Marson make it in a fashion that has to make you think of a Pinot Noir. It won everybody over.
The taste of Chablis is characteristic: a dry white with more acidity and slightly less fruit than your average chardonnay. 2005 was an outstanding year in Burgundy and this little wine, which can be found all around Australia for a very reasonable price, is absolutely worth it.
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