U.S. has second largest welfare state in the world

Second only to France in percent GDP spent on social welfare

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U.S. has second largest welfare state in the world

#1  Postby Warren Dew » Nov 26, 2014 7:51 am

WASHINGTON -- We Americans pride ourselves on not having a "welfare state." We're not like Europeans. We're more individualistic and self-reliant, and although we may have a "social safety net" to protect people against unpredictable personal and societal tragedies, we explicitly repudiate a comprehensive welfare state as inherently un-American.
Dream on.

Call it a massive case of national self-deception. Indeed, judged by how much countries devote of their national income to social spending, we have the world's second-largest welfare state -- just behind France.

Read more: http://www.realclearpolitics.com/articl ... z3K9n6goSI
Follow us: @RCP_Articles on Twitter

http://www.realclearpolitics.com/articl ... 24769.html
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Re: U.S. has second largest welfare state in the world

#3  Postby irreligionist » Nov 26, 2014 8:00 am

^sorry, bookmarking to read later. Am curious to see what (if any) level of political bias there is
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Re: U.S. has second largest welfare state in the world

#4  Postby Thommo » Nov 26, 2014 8:04 am

US government spending is somewhere around 34% of GDP, if this was actually true that means all other government spending from roads, to schools to defence would come in at a pretty cost effective 4% of GDP.

Double counting tax rebates is always going to give you a strange answer which doesn't mean much, which is of course why the actual figure (quoted in the article to be fair) places the US below the OECD average.

ETA: The dataset in question is (I think) this one:
http://stats.oecd.org/Index.aspx?DataSetCode=SOCX_AGG and can be seen to rank the US 2nd if sorted to Net Total Social Expenditure in % GDP
Last edited by Thommo on Nov 26, 2014 8:14 am, edited 1 time in total.
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Re: U.S. has second largest welfare state in the world

#5  Postby Loren Michael » Nov 26, 2014 8:10 am

America has (and has had for a long time) the most expensive healthcare system in the world; this is hardly a mystery and the article notes it:

It [the United States] ranks 23rd in the world with social spending of roughly 19 percent of gross domestic product (GDP). This is slightly below the OECD average of 22 percent. France is the champ at nearly 32 percent. (The data are generally the latest available, including some estimates for 2014.)

But wait. Direct government spending isn't the only way that societies provide social services. They also channel payments through private companies, encouraged, regulated and subsidized by government. This is what the United States does, notably with employer-provided health insurance (which is subsidized by government by not counting employer contributions as taxable income) and tax-favored retirement savings accounts.

When these are added to government's direct payments, rankings shift. France remains at the top, but the United States vaults into second position with roughly 30 percent of its GDP spent on social services, including health care. We have a hybrid welfare state, partly run by the government and partly outsourced to private markets.


along a lot of metrics, it's also relatively bad:

http://www.theatlantic.com/health/archi ... ng/372828/

The United States healthcare system is the most expensive in the world, but when it comes to health outcomes, it performs worse than 11 other similar industrialized nations, according to a new report released today by the Commonwealth Fund.

The nonprofit examined the health systems of Australia, Canada, France, Germany, the Netherlands, New Zealand, Norway, Sweden, Switzerland, and the United Kingdom, and it found that the U.S. was last or near-last in measures of health access, efficiency, and equity.


my takeaway is that a lot of countries have more efficient welfare states than the US
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Re: U.S. has second largest welfare state in the world

#6  Postby Thommo » Nov 26, 2014 8:20 am

It's a peculiar artifact of the way tax rebates factor, it's effectively looking at what would happen if the rebate wasn't granted and treating that hypothetical government income as if it were actual income and then spending as well. Of course the whole market would be different if taxes were 10-15% of all economic activity higher, this would be like upping corporation tax by a margin big enough to cripple industry entirely.

In reality if the rebate didn't exist, then the tax code would change accordingly, as would the funding method, you wouldn't end up at this 30% figure.

It's also important to remember that this kind of welfare statistic is dominated by health care costs and pensions. Actual "hand outs" - disability, job seekers allowance and so on are a tiny, tiny fraction of that but policies tend to be based on a quote of the total figure and then targeted at that small fraction.
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Re: U.S. has second largest welfare state in the world

#7  Postby Ven. Kwan Tam Woo » Nov 26, 2014 8:36 am

Does this ranking factor in all the money the US Govt spend on bailing out big banks and auto firms in the wake of the GFC?
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Re: U.S. has second largest welfare state in the world

#8  Postby Spearthrower » Nov 26, 2014 11:28 am

Warren Dew wrote:
WASHINGTON -- We Americans pride ourselves on not having a "welfare state." We're not like Europeans. We're more individualistic and self-reliant, and although we may have a "social safety net" to protect people against unpredictable personal and societal tragedies, we explicitly repudiate a comprehensive welfare state as inherently un-American.
Dream on.

Call it a massive case of national self-deception. Indeed, judged by how much countries devote of their national income to social spending, we have the world's second-largest welfare state -- just behind France.

Read more: http://www.realclearpolitics.com/articl ... z3K9n6goSI
Follow us: @RCP_Articles on Twitter

http://www.realclearpolitics.com/articl ... 24769.html



Doesn't it just show that the US welfare system is expensive / inefficient?
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Re: U.S. has second largest welfare state in the world

#9  Postby mrjonno » Nov 26, 2014 12:06 pm

- We Americans pride ourselves on not having a "welfare state


That is a very strange idea, what is opposite of a welfare state a no welfare state?
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Re: U.S. has second largest welfare state in the world

#10  Postby kennyc » Nov 26, 2014 1:11 pm

mrjonno wrote:
- We Americans pride ourselves on not having a "welfare state


That is a very strange idea, what is opposite of a welfare state a no welfare state?


You'll have to check with a Republican.

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Re: U.S. has second largest welfare state in the world

#11  Postby mrjonno » Nov 26, 2014 1:24 pm

The word 'welfare' to me in a first instant means 'caring', which is why I find the idea of being against a caring state pretty strange
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Re: U.S. has second largest welfare state in the world

#12  Postby Nicko » Nov 26, 2014 2:46 pm

Loren Michael wrote:America has (and has had for a long time) the most expensive healthcare system in the world; this is hardly a mystery and the article notes it:

It [the United States] ranks 23rd in the world with social spending of roughly 19 percent of gross domestic product (GDP). This is slightly below the OECD average of 22 percent. France is the champ at nearly 32 percent. (The data are generally the latest available, including some estimates for 2014.)

But wait. Direct government spending isn't the only way that societies provide social services. They also channel payments through private companies, encouraged, regulated and subsidized by government. This is what the United States does, notably with employer-provided health insurance (which is subsidized by government by not counting employer contributions as taxable income) and tax-favored retirement savings accounts.

When these are added to government's direct payments, rankings shift. France remains at the top, but the United States vaults into second position with roughly 30 percent of its GDP spent on social services, including health care. We have a hybrid welfare state, partly run by the government and partly outsourced to private markets.


along a lot of metrics, it's also relatively bad:

http://www.theatlantic.com/health/archi ... ng/372828/

The United States healthcare system is the most expensive in the world, but when it comes to health outcomes, it performs worse than 11 other similar industrialized nations, according to a new report released today by the Commonwealth Fund.

The nonprofit examined the health systems of Australia, Canada, France, Germany, the Netherlands, New Zealand, Norway, Sweden, Switzerland, and the United Kingdom, and it found that the U.S. was last or near-last in measures of health access, efficiency, and equity.


my takeaway is that a lot of countries have more efficient welfare states than the US


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Re: U.S. has second largest welfare state in the world

#13  Postby laklak » Nov 26, 2014 2:58 pm

Calling the U.S. government "inefficient" is like calling a Krakatoa eruption a "bit of lava".
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Re: U.S. has second largest welfare state in the world

#14  Postby Nicko » Nov 26, 2014 3:04 pm

mrjonno wrote:The word 'welfare' to me in a first instant means 'caring', which is why I find the idea of being against a caring state pretty strange


The problem is that for a large chunk of the US electorate "welfare" means, "Big government giving handouts to lazy good-for-nothings who just spend it on drugs and alcohol anyway. like they did in Communist Russia."

Appeasing these morons means that a goodly proportion of social spending is funneled through pseudo-capitalist fronts. The way the US provides healthcare - as Loren has pointed out - is a good example of this.

One upside to catering to this ideology is that it produces champagne comedy moments like these:

Image


And after all, isn't laughter the best medicine?

Well, with the exception of, you know ... actual medicine.
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Re: U.S. has second largest welfare state in the world

#15  Postby Teague » Nov 26, 2014 6:30 pm

Nicko wrote:
mrjonno wrote:The word 'welfare' to me in a first instant means 'caring', which is why I find the idea of being against a caring state pretty strange


The problem is that for a large chunk of the US electorate "welfare" means, "Big government giving handouts to lazy good-for-nothings who just spend it on drugs and alcohol anyway. like they did in Communist Russia."

Appeasing these morons means that a goodly proportion of social spending is funneled through pseudo-capitalist fronts. The way the US provides healthcare - as Loren has pointed out - is a good example of this.

One upside to catering to this ideology is that it produces champagne comedy moments like these:

Image


And after all, isn't laughter the best medicine?

Well, with the exception of, you know ... actual medicine.


I have to ask because I'm not 100% sure but isn't medicare/medicaid/whateveritscalled the medical care the gov't already pays for???
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Re: U.S. has second largest welfare state in the world

#16  Postby Strontium Dog » Nov 26, 2014 6:41 pm

mrjonno wrote:
- We Americans pride ourselves on not having a "welfare state


That is a very strange idea, what is opposite of a welfare state a no welfare state?


A meritocracy? :)
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Re: U.S. has second largest welfare state in the world

#17  Postby Thommo » Nov 26, 2014 7:44 pm

laklak wrote:Calling the U.S. government "inefficient" is like calling a Krakatoa eruption a "bit of lava".


Although ironically the inefficiency is in the private sector in this instance. The US spends 250% of the OECD average on healthcare and has done since before Obamacare, for average-ish results. Every single one of the best and most efficient systems are managed by central government, with the outlier (the US) being the only system primarily in private hands.

The private sector is demonstrably failing in this area - catastrophically. I know this goes against the general trend of public sector inefficiency and bloat, but there are reasons for it.
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Re: U.S. has second largest welfare state in the world

#18  Postby Clive Durdle » Nov 26, 2014 9:10 pm

Yes medicare and the other one medicaid are government programmes!
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Re: U.S. has second largest welfare state in the world

#19  Postby laklak » Nov 27, 2014 6:31 pm

Thommo wrote:
laklak wrote:Calling the U.S. government "inefficient" is like calling a Krakatoa eruption a "bit of lava".


Although ironically the inefficiency is in the private sector in this instance. The US spends 250% of the OECD average on healthcare and has done since before Obamacare, for average-ish results. Every single one of the best and most efficient systems are managed by central government, with the outlier (the US) being the only system primarily in private hands.

The private sector is demonstrably failing in this area - catastrophically. I know this goes against the general trend of public sector inefficiency and bloat, but there are reasons for it.


True to a degree. One of the biggest problems with Medicare and Medicaid is the unbelievably bloated bureaucracy and byzantine regulations. Mrs. Lak finally gave up clinical OT work because she was spending as much time filling out government paperwork (unpaid time, that) as she did actually treating patients. She worked till 10 or 11 at night almost every work night keeping up with the paperwork. One could be forgiven for looking at the regulations and deciding their true purpose was to increase costs.

Another issue is litigation. Doctors order a slew of unnecessary and expensive tests because if they fart sideways someone will sue them. You see ads on TV all the time about class actions lawsuits against pharmaceutical companies or for specific surgical procedures or devices. Tort reform would go a long way to solving that issue, but it never gets a look in through Congress.
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Re: U.S. has second largest welfare state in the world

#20  Postby mrjonno » Nov 27, 2014 7:21 pm

Are big companies really more efficient than government.

Worked for both and there were definitely inefficiencies in government but at least generally everyone in a particular organisation wanted the same thing. When it comes to big business no one actually has given a shit about overall profits in any company I've ever worked for. Yes everyone cared about targets and profits in their particular part of the company and would do the best to maximise it but so often this was at the cost of other parts of the business. The real competition wasn't between rival companies but between people within a company for their own benefit not that of the companies.

The classic in IT is the selling of a project that doesn't work from the very beginning due to its design (normally to minimise costs) , the salesmen gets his commission and 2 years later when he has moved on to another job the actual technical people are still trying to sort out the mess (after spending a fortune trying to resolve it). Why doesnt this company go under because all its rivals are doing the same
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