Two Welfare Utopias

There you have it. We have a several possibilities for reducing poverty and and the size of government at the same time. We do not have to choose between them; we can mix and match.

I have not given what I think is the ultimate system for taking care of the poor. This is because I do not know exactly what it is. The purpose of this chapter is to make people better understand the problem and to point out improvements we can implement now to improve the situation.

One reason why I don't know what the ultimate situation is, is that I do not know how many poor people we would have if there were no perverse incentives to act poor. I do not know how generous the middle and upper classes would become if they were not taxed so heavily. I do not know how much the income levels of unskilled laborers would go up if employment was less punished and capital was more plentiful.

We will have a much better picture for the ultimate solution by first applying some interim solutions. Such interim solutions would include:

• Reduce the perverse incentives that come from proving poverty by using fuzzy cut-offs.
• Get the middle class off the dole. Return power and responsibility to the people.
• Increase the supply of capital [see The Balance of Wealth] so that market wages increase.
• Decrease red tape so that there will be more small business opportunities.
• And so on.

After such measures have been effect for a while, we can look into other issues, such as how much the welfare system should be privatized, and whether a flat entitlement would be less bureaucracy than a fuzzy cut-off.

But before leaving this subject, here are a couple of possible inspirations for what the ultimate solution could be, one from the far future and one from the ancient past.

The Gray Buildings

If you are, or ever have been a hippie, I highly recommend to you some of the science fiction stories of Norman Spinrad. In some of this stories, he has done an amazing job of portraying societies based on a mixture of hippie values and limited government. His novels, especially “Child of Fortune” provided a good deal of inspiration for this site. A note to English majors: unlike most science fiction writers, Spinrad has a real flair with language; his works are very poetic. Enjoy.

In “Child of Fortune” there is a planet which is wealthy and attracts large numbers of tourists, including hippies who run out of money. Their solution is ingenious: gray buildings, with gray rooms containing gray bedding and gray food. Anyone can go to such buildings to sleep for free (on a barely comfortable cot), get a shower, receive needed healthcare, get a change of clothes (in one style and color) and get free food (which comes in exactly one bland flavor) You get exactly what you need and absolutely nothing else. If you want luxury, you have to work for it.

This system applies several of the ideas explored in this chapter. There is no proof of poverty required; this is an entitlement available to anyone. It is a set of free services designed to bring you up to the poverty line and no further. Since the society is a rich one, this poverty line is well below the median income so requires limited taxation. The services are self-limited by being intentionally boring. People who have ability have an incentive to leave.

Could we afford such a system today? I think the free medical care would be difficult without some waiting period or other inconvenience to discourage the well off from partaking in the service. But the rest could be done and it could eliminate the problem of homelessness. Such a system would get used by both homeless people and hippies touring the country. Some poor people who could afford a home might use the system in order to save up money for a better future. Some poor people might use the system while looking for a job.

But few people would want to abuse such a system. Sleeping in a room with homeless people is not a lifestyle many would want to follow for long. One flavor human chow would get boring rather quickly. Many of the homeless will opt to do some work in order to afford booze if nothing else.

I do not think such a system could replace all welfare and charity, but it could be a good way to handle that gray area between needy and lazy.

A Welfare non-State

Dust off your Bible and read the early books. You will find a legal system designed to work without a government as we know it. After the conquest of Canaan, the Israelites lived for many generations in a system that was close to anarcho-capitalism. There were no tax collectors, jails, police, legislators, or standing armies. Yet there was a welfare system! Think of it: they didn't have what conservatives and moderate libertarians consider the essential parts of government but they did have a welfare system!

An no, that welfare system was not based on an annual 10% income tax, as many imagine. The annual tithe to the priesthood was for the priesthood. The system for the poor was far more interesting. See God's Welfare System.