Posts tagged with: Welfare economics

Wilkins Micawber from David Copperfield art by Frank Reynolds (2)

Wilkins Micawber, the namesake for the Micawber Principle.

Joe Carter points to a Lifehacker article that sums up two basic equations that lead to the creation of wealth (with what I consider to be a clarifying correction applied in the first formula):

Income > spending = surplus

Surplus x time = wealth

Likewise, Wilhelm Röpke, in his A Humane Economy, points to two equations arising from classical literature that connect surplus with happiness and deficit to misery (the Micawber Principle).

According to Mr. Micawber from Dickens’ David Copperfield:

Annual income £20, annual expenditure £19.975 = happiness

Annual income £20, annual expenditure £20.025 = misery
(more…)

I recently came across an interesting academic journal, Diaconia: Journal for the Study of Christian Social Practice. One of the sample articles available is by Herman Noordegraaf of the Protestant Theological University in Leiden. His piece is titled, “Aid Under Protest? Churches in the Netherlands and Material Aid to the Poor” (PDF).

The latest issue of the Journal of Markets & Morality is a theme issue on “Modern Christian Social Thought,” and a series of pieces take up a line of recent history in the Netherlands. A significant article by Rolf van der Woude, senior researcher at the Historical Documentation Centre for Dutch Protestantism at the VU University Amsterdam, examines the changes in Reformed thought on the social question from the First Social Congress in 1891 to the Third Social Conference in 1952. As van der Woude concludes, in the post war era, “A new generation believed that the beast of the state, caged for so long, had now been tamed. At the end of the 1950s, Van den Heuvel’s generation retreated, the Netherlands entered a period of economic boom, and a generous welfare state was rapidly erected from the ground up wherein welfare was no longer a matter of charity but a matter of justice guaranteed by the government. The beast of the state had become an ally.”

Noordegraaf’s piece can be read as a companion article to van der Woude’s, tracing the development (or lack thereof) in Christian social thought in the Netherlands over the last half century. As Noordegraaf writes, the situation has largely remained the same, in that the church’s primary responsibility is understood not merely to have to provide material assistance to the poor, but rather advocate for reliance on the welfare state for such provision. As Noordegraaf writes, a declaration on the problem of poverty in 1987 codified the approach of “aid under protest,” in which the churches provide aid to the poor but only under protest that the government was not meeting welfare needs appropriately. The statement reads:

We reject the way people are once again made dependent on charity. We plead for social security that is not charity but a right that is fully guaranteed by government. For this reason, financial aid given by churches in situations of need should be combined with protest against the causes of this need to government and society.

Noordegraaf’s observation is that the churches, both locally and denominationally, have been too concerned with meeting the momentary concrete needs of the poor and need to pay more attention to the mandate to lobby the government for more expansive social welfare programs. The point is that the need for Christian or church-based charity indicts the lack of justice under a modern constitutional state, where freedom from need and want ought to be simply guaranteed.

As Nordegraaf concludes concerning recent trends, “More and more, as the above mentioned reports show, churches have been involved in material aid: when people are in need and ask for help, you give it. It is a kind of safety net under the increasingly porous safety net of the state.” He continues, “The fact that the churches found this problematic reflects their belief that the principles of the welfare state are worth fighting for. This has to do with a vision of the task of the state to promote the general welfare and to secure the basic needs of people in society.” Noordegraaf concludes that “it is in harmony with the calvinist approach of the responsibility of the state that churches try to make clear to government and to society at large that they have helped with material aid. This signalizing can take many forms: in letters, reports, talks, discussions, programmes in the media, articles in newspapers and so on. In this way, individual aid is combined with advocacy in the public domain.”

I commend these two articles to your reading: Rolf van der Woude, “Taming the Beast: The Long and Hard Road to the Christian Social Conference of 1952,” and Herman Noordegraaf, “Aid Under Protest? Churches in the Netherlands and Material Aid to the Poor.”

They will make clear just how much things have changed over the last 120 years in the Netherlands, when Abraham Kuyper emphasized the priority of Christian giving in 1881, arguing that “the holy art of ‘giving for Jesus’ sake’ ought to be much more strongly developed among us Christians. Never forget that all state relief for the poor is a blot on the honor of your savior.” Such emphasis on private Christian charity is now understood to be retrograde and obsolete.

An interesting report in The Economist on the rise of flashy and free spending entrepreneur “gazillionaires” in India and China and how they are perceived:

In much of India, life is getting perceptibly better each year. Wealth per person has vaulted by 150% in the past decade, from $2,000 to $5,000. Many Indians think the nation’s entrepreneurs deserve some of the credit. In Dharavi, a slum outside Mumbai, an illiterate mother called Aruna sits in her tiny one-room flat, which is home to ten people. Asked how she feels about the rich, she says: “They have worked hard. And we must work hard, too.” Her eldest daughter has a job entering data at a bank. The next one is studying diligently. The family may be near the bottom of the ladder, but it sees a way up.

But this in China:

The perception that commercial success often depends on political ties makes inequality in China more galling. In the mid-1980s Chinese incomes were more evenly distributed than India’s—hardly surprising, since China was nominally communist and India is afflicted by a caste system. But now China is less equal than India, with a Gini coefficient of 0.4 to India’s 0.37. China has 800,000 dollar millionaires, but also 400m people who live on less than $2 a day.