Longer Views

There is (this will be no news to anyone who’s been awake for the last forty years) a debate about whether state-provided social services are too expensive to be continued, whether they’re actually beneficial to their recipients or reduce them to the status of helpless dependents, whether they’re more or less efficient than some hypothetical market mechanism– in sum, whether they should exist at all. At least as presented in the relatively highbrow newspapers and magazines that cross my threshold, the matter of cost is always framed in relation to current expenditures: health and education as a fraction of GDP, or as compared to defense, etc.

That way of framing the math, however, renders invisible many dimensions of benefit and cost that become perceptible only when we look at matters in a longer view (say over a lifetime) and dice more finely the categories of payers and recipients. It turns out that for the overwhelming majority of British rate-payers, and by overwhelming I mean 93%, the amount paid in over a lifetime exceeds the amount received in benefits. So you can forget about the welfare queens, the “culture of dependency,” and all that stuff. Who knew, you may ask, that the public was always stepping up to the plate and giving a little more than necessary to help the less fortunate?

In another way, social services such as education, healthcare, and unemployment insurance act as a collective savings account to get people through the hard times. The number of people who will at one point or another need to call on these collective savings is large. Only a few people never experience need over their lifetimes. The few lucky standouts shouldn’t begrudge the majority whom social investments kept from going broke at one point or another: if the unlucky folks really had to eat garbage or steal on a regular basis in order to survive, surely the lucky ones would be sleeping less well at night. And need is not a lifetime thing; it happens in moments or cycles and, once again, the impact can be cushioned by the whole society’s willingness to think and pay ahead.

Admittedly, these results are from Great Britain, where some 70 years of Labour-inflected policy have created a long enough statistical run to give useful data. But surely in the US, even without a National Health Service and despite our patchwork of state governments, some more provident than others, the numbers exist to show what entitlements really do and don’t do, under a variety of conditions, over a lifetime. I’d be glad to read a factual comparative study. In the meantime, here’s the report on lifetime outcomes from the Nuffield Foundation’s Institute for Fiscal Studies: