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OPINION AND ANALYSIS | 15-12-2018 09:33

West hit by a triple whammy

The welfare state was an admirable creation, but it is structurally incapable of coping with the demographic changes it contributed to bring about.

The habit of placing politicians, intellectuals and others on a spectrum running from left to right, or right to left, is still very much with us, but it now serves no useful purpose beyond providing would-be progressives with a handy insult. When they brand someone as “right-wing” or “ultra-right” they tell us nothing much about his or her policies, which are often much the same as those that were proposed by “left-wingers” of previous generations. For many, it simply means disapproval of anyone who confesses to a strong dislike of militant Islam which, in its political form, is about as “right-wing” as any movement could possibly be.

The obsession with political geometry, which for decades strongly influenced the way most of think about the way countries should be governed, may have simplified matters and made what was happening seem easier to understand, but for a long time it distracted attention from developments that people who made much of their left-wing or right-wing standpoint preferred not to grapple with but which, as the years passed, would have a huge impact on society. Pragmatic “centrism” – an attempt to leave the 200-year-old left-right continuum behind, which was favoured by Tony Blair and his counterparts elsewhere – did not provide any answers; it soon became apparent that, after a promising start, their quest for a “third way” between the dog-eat-dog capitalism they located in the United States and socialist incompetence in much of the rest of the world was getting nowhere.

For reasons which had nothing to do with ideology, in democratic countries governments found it increasingly hard to combine a decent concern for public welfare with an adequate degree of economic efficiency. As many belatedly appreciated, too much of one is bad for the other. If they keep social spending high, the economy suffers; if making their country more “competitive” is their priority, large numbers of their fellow citizens will sink into poverty.

A generation or so ago, Europe’s welfare states, with their generous cradle-to-grave social services, were viable. This is no longer the case. Abrupt demographic changes, with birthrates plummeting and most people living far longer, have made the existing pension and health schemes obsolete but, for sound electoral motives, few politicians are willing to say as much. Attempts to solve the problem by importing large numbers of breeders from the underdeveloped world have not worked at all well; too many of the newcomers and their offspring end up on the welfare rolls and, in any event, they often have little interest in adapting the customs of their hosts who, to judge from what the presumably best and brightest among them have to say, do not think their own approach to life has much value and are therefore reluctant to suggest immigrants should make an effort to fit in.

Demography has struck Europe a body blow from which it may never recover, but if the people who warn us that armies of fiendishly smart robots are on the march and within a few years will have taken over a large proportion of the jobs which are currently done by humans are right, as they almost certainly are, the outlook is about to become even darker. People living in rich countries have already seen once prosperous lines of business, among them the ones associated with the news media, suddenly finding it difficult to stay afloat. Optimists say that the looming “fourth industrial revolution” will create plenty of new jobs as did the first, second and third, but so far all it has done is to force a growing number of professionals, middle managers and the like to make a go of working in supermarkets while their savings dry up.

Unfortunately, there is no reason to think that most of the men and women who will have to step aside and let some clever electronic device take charge of what they have been doing will be in a position to take advantage of whatever new opportunities arise. As for the belief that modernised educational systems should be able to teach them the new skills that will soon be in demand, the very idea seems preposterous. Some lorry drivers, supermarket cashiers or bank clerks may well have what it takes to become hightech innovators of the kind that are expected to thrive, but it is safe to say that the majority of them, along with most others who do comparable work, do not.

Adding to the woes that have already begun to overwhelm part of the rich world’s large middle class, and what remains of the working class, is the sudden transformation of China. Donald Trump is right to take a dim view of that country’s “predatory” behaviour, but even if from now on the Chinese were to obey all the rules they are accused of breaking, give up cyber-espionage and show the utmost respect for foreign intellectual property rights, they would still continue to make life far more difficult for everybody else because, despite decades of communist indoctrination, by nature they are so competitive.

To match them, people in the rest of the world would have to become as keen as they are on education and as willing to work every bit as hard. Unless they do so, they had better resign themselves to playing minor, subordinate roles in a world order in which the Chinese, who are prone to look down on lesser countries much as did Europeans and North Americans before it became fashionable for them to pay penance for the sins of their benighted forefathers, call most of the shots.

As things stand, the West seems doomed to be the main victim of its own success. The welfare state was an admirable creation, but it is structurally incapable of coping with the demographic changes it contributed to bring about. Western technology is a marvellous achievement, but it has acquired a life of its own and seems bent on wrecking the social order that gave it birth. And China’s rulers, after making a determined, and blood-soaked, attempt to make Marxism, (which they imported from the West) work its wonders, decided to replace it with another, far more promising, Western creation, liberal capitalism, and are proving to be every bit as good at it as are the people who made it what it is.

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James Neilson

James Neilson

Former editor of the Buenos Aires Herald (1979-1986).


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