By JP Floru
When the state starts doling out money on a vast scale, you have to limit the number of recipients. A welfare state is therefore inherently tribal – its survival depends upon a ‘to us, but not to them’ – attitude. People are herded into groups to exclude others – and merit is rarely the criterion to qualify. One could say that a welfare system is inherently anti-social.
So it is no surprise when socialist thinkers start to defend caps on immigration, so hand-outs can be limited to one specific tribe. It is of course not affordable for a country to hand out money to all the poor of the world or to anyone flying into Heathrow.
As a taxpayer I am frankly not interested what the tribal characteristics of a benefits scrounger are. To me, a scrounger is a scrounger, irrespective of his race, sex, nationality, social background. I myself am an immigrant. Since I arrived on 2 October 1994 I, and many like me, have not lived one single day off the state. Quite the contrary: I get out of bed to work every day, and am coerced into parting with a big chunk of my pay to people who decide to stay in bed. I am frankly not interested to know the passport or the colour of that healthy chap who stays in bed at my expense. The only thing I am concerned about is that he should not get a penny.
Socialism is the root cause of excessive welfare and scarcity of jobs
If we are to have a welfare state at all, it should be minimal. Today that is hardly the case. Hand-outs are not limited to those few cases of people who have fallen upon hard times through no fault of their own – entitled are everybody who is defined as entitled. Sadly it is the tribal aspect of welfare payments which has become the issue – in the form of caps on immigration – rather than the largesse and the existence of the welfare state itself.
The immigration debate is not just about welfare, it is also about jobs. Thanks to high taxes and overregulation we have become highly uncompetitive. Today our main export product is jobs to the Far East. So more and more people are out of a job here and as the West is apparently not coming to its senses they risk remaining so for the rest of their lives. Add to this free immigration and you have a serious problem: more and more people competing for fewer and fewer jobs.
It is now proposed by some that belonging to the tribe, i.e. being British, should give preference when applying for jobs. An irrelevant characteristic comes in through the front door while skill or aptitude is thrown out of the window. Are we seriously saying that not the most capable, but the one with the right passport should get the job? Are we to give the job to a labourer who turns up when it suits him and takes twenty-five tea and mobile phone breaks a day, because he is British; rather than to a Pole who works 12 hours a day, 6 days a week? Sadly it is the tribal aspect of jobs which has become the issue – in the form of caps on immigration – rather than the socialism which has caused a shrinking of the labour market in the first place.
Needs based immigration is a central planning non-solution
Given the fact that the bloated welfare state and uncompetitive socialism are here to stay for now, what to do? Most now argue that we should limit immigration ‘to those who are really needed’. A politician, or a customs official with a clipboard, is going to decide who is needed and who isn’t. We are apparently in the business of centralised planning again. Never mind Hayek’s Knowledge Problem, which tells us that millions of individuals (that is, the market) are in a better position to decide what is needed than centralised planners. If we let ‘immigration based on needs’ go ahead, no doubt, as per usual, one or two special interest groups will ensure that their sort of immigrants are left in, and the others aren’t.
So what is the solution to the twin problems of scarcity of welfare money and jobs – both created by socialism?
Two imperfect solutions
One solution could lie in not entitling immigrants to welfare payment for, say, the first ten years after their arrival. If they become needy they can return to their country, or rely upon charity (no doubt many ex-immigrants would be happy to contribute voluntarily to such charities). Jobs would still go to the best qualified person, irrespective of tribe. A friend of mine pointed out that one problem with this is that some immigrants wouldn’t mind living on the streets even if they didn’t receive welfare or services.
Another solution was devised by Nobel Prize winner Gary Becker, and explained at the IEA’s Hayek Memorial Lecture 2010. He believes in fee-based immigration – immigrants would for example have to pay a one-off $50,000 fee to settle in the US. The amount could be decided by auction. It could be lowered for the less well off. The fee could be deducted by way of income tax. Another possibility is to make immigrants post a bond – whereby any welfare payments, school fees or other entitlements are deducted and one receives the remainder back after, say, ten years.
Both solutions are imperfect if you are a libertarian purist who believes that immigration should be entirely free. That is problematic, of course, as long as the welfare state exists. One very bright friend wanted free immigration with the welfare state: so the system would collapse!
Both the scarcity of jobs and the existence of excessive welfare are problems stemming from socialist policies. The most commonly heard solution today seems to be to ration both on tribal grounds : in effect, socialism wedded to nationalism. Instead of excluding people who may be equally or more deserving, one should tackle the root cause: uncompetitive economic policies and welfare. And if we don’t have the guts to tackle the cause, we might at least use a solution which maintains human dignity and individuality intact, such as Gary Becker’s.