The principle of the social contract is that I agree to live according to the law and pay a contribution towards the common good, in return for certain benefits that I receive, directly or indirectly, from the state.
While the majority of the world agrees with this general principle, there are widely different ideas, across the politcal spectrum and across different geographies, about what primary benefits the state should provide. Furthermore, when one finds ones own views or assumptions challenged, it is often very difficult to find rational arguments one way or another.
For me, having grown up in one of the worlds first and best welfare states (New Zealand), it is ‘obvious’ that the state should provide:
- Universal free primary and secondary schooling
- Universal and ‘almost-free’ healthcare
- Free dental care for children
- High-quality, meritocratic, and affordable university education
- A guaranteed minimum income for the unemployed, single parents, the physically and mentally ill, and the elderly (i.e. everyone who can’t provide for themselves)
- Affordable housing for all the above categories
- An efficient network of roads, railways, data and energy services
- …and so on. You get the picture.
I get indignant, whenever I see countries that don’t provide these things. But, digging deeper, one discovers that all kinds of things that could equally well merit being in the list, which even in idyllic NZ are provided by profit-motive or non-profit organisations, for example:
- Dental care for adults (why our teeth are somehow less deserving than the rest of our bodies, I never did understand…)
- Preschool education
- Ambulances
Mainly for historical reasons – all these complex social solutions have evolved over time, and each choice has had its specific motives and internal / external causes. And each country around the world has its own idiosynchratic list of ‘whats included’ in the package deal of the social contract. The question I ask myself is: is there some sort of general principle that defines whether it would be better to provide a state solution or leave it to the market?
Maybe.
Here are some factors that seem relevant to me – the formula, if it exists, should somehow combine these (and probably many others):
- Is it a regulatory mechanism of the democratic system itself? (police, justice system,…)
- Is it a natural monopoly? (Physical networks – road, rail, power, fiber optic,…)
- Is it primarily a common good? (Air, water, …)
- Are the consequences of individual deprivation unacceptable to society? (education, housing, healthcare, minimum income,…)
- Is it a mechanism of social mobility and integration (healthcare and education, again)
- Are its objectives unsuited for profit-motive organisations (healthcare and education, again)
Well, you can easily guess my stance on this from the questions I’m asking. But the most pertinent, and the one I use more and more often in my thinking, is point 4. Focus on the consequences, not the ideological principles.
Thats one of the things I loved about Obama’s inauguration speech – his pragmatic ‘if it works, we’ll fund it, and if it doesn’t, we won’t’ line. Unfortunately, I have my doubts that even he is going to be able to put ’the whole goddamn multi-payer profit-motive healthcare system’ in the bucket of the things that don’t work…even though we all know that’s where it belongs.