Forced Entry – How Government Came to Dominate Welfare

Publication, Poverty, David Seymour

Executive Summary

• Modern discussion of poverty and social services take place in a paradigm where government income redistribution and, often, service delivery are seen as indispensible.

• Today’s welfare state is not the only way to solve the problems of inequality, unstable income, and the need for healthcare and education. Understanding how the welfare state came to be and what it replaced enables a much more imaginative poverty debate than we currently have.

• Victorian England gives us an historical model or solving poverty and delivering healthcare, education, and employment insurance with almost no state involvement.

• This comparison must be cautious. Victorian England was drastically poorer in real terms than modern Canada and had social norms that seem quaint in 2009. However adopting the Victorian
model of welfare without the welfare state would not necessitate that we have either of those features.

• In the 1860’s 95.5% of British school children were estimated to be in school, despite almost no government participation in the education sector.

• In 1892, close to 100% of working men were members of social insurance collectives which provided for their needs and those of their families.

• Hospitals were almost always funded by private endowment.

• Charitable giving, aside from self insurance, was as high as 10% of family income, today it is closer to 1%.

• Although much of Canada was established post Victorian times, many of these institutions existed here too.

• Throughout the late nineteenth century and the first half of the twentieth, western governments including Canada’s staged a takeover of the education, healthcare, and employment insurance
functions previously catered for by civil society.

• Governments have taxed civil society out of the means and the moral obligation to provide the services it once did.

• Evidence suggests that this takeover was driven more by the desire for universality in itself than better outcomes or greater efficiency in any of the functions.

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