Many readers of this blog will be aware of the tireless advocacy work for liberty in this country since the 1970s by Wolfgang Kasper, emeritus Professor of Economics at the University of New South Wales and former Senior Fellow of the Centre for Independent Studies.
He has painted on the intellectual canvas of Australian classical liberalism with broad brush strokes, writing on topics ranging from the institutional foundations of free markets right through to applied public policy controversies such as industry protectionism, labour market regulation, activist macroeconomic policies and many more.
His retirement of a few years ago to the picturesque southern coast of New South Wales appears to have had a negligible effect on Kasper’s appetite to produce quality intellectual output.
Some examples that readily spring to my mind include his comprehensive pamphlet The Merits of Western Civilisation: An Introduction, produced for the IPA Foundations of Western Civilisation Program, a critique of neoclassical economic orthodoxy, and writings about the troublesome Euro. There are also promises of more quality contributions to come, including an eagerly anticipated second edition (with Peter Boettke) of his classic book Institutional Economics.
In the latest edition of Quadrant magazine (online copy available through subscription only), Kasper delivers a withering critique of the welfare state which, to my way of thinking, represents perhaps the finest piece of writing one can find anywhere on this topic so far in 2012.
Kasper chides the numerous proponents of the welfare state stating that they ‘should by now realise that redistribution policies have not worked.’
He not only points to the fact that the poor are still among us, despite countless taxpayers’ funds conscripted to support a widening array of ‘needs,’ but that the welfare state has distorted the very nature of government itself (brilliant quote alert!):
the essential primary government function of protecting life, liberty and property has been white?anted by more and more confiscation to bankroll socialised welfare. To the extent that the state takes property rights away to give to others, it contravenes its protective function.
For Kasper, a fundamental determinant of the seemingly ceaseless growth of the Western welfare state is the principal?agent problem applied to the majoritarian democratic setting. In addition to the well?known rational ignorance problem faced by the voting public, the immediate beneficiaries of the welfare state (viz. bureaucrats and public sector unionists, tax?financed social welfare NGO lobbies) have every incentive to ensure layers of welfare payments and social programs accumulate over the top of each other.
Needless to say, it is the financially beleaguered taxpayer who is continuously hounded by the travellers of the welfare state gravy train to cough up more funds so that the ride continues. But even the welfare state has to reach its ‘Malthusian limits’ (as Frederic Bastiat once described it), as the distortionary effects of taxes and regulations to maintain the rising?cost welfare state impairs self?reliant behaviours, the exercise of entrepreneurial creativity and, consequently, economic growth. Witness Europe and the United States in their smoky fiscal ruins, with Australia surely following behind on current trends.
In typical style Kasper goes beyond the critique and provides numerous suggestions for reform, in this case to allow voters to regain the mantle of their runaway governments and substantially reduce the welfare state in the process. While I shall leave the detailed suggestions for those who wish to read the article, the following quote is representative of Kasper’s views on the nature of the reforms that must take place:
the best general prescription for restoring genuine democracy and a robust, free economy is to privatise wherever possible, to foster competition and to devolve activities to lower levels of government (subsidiarity). There is much international evidence that this not only saves the welfare state from itself, but also reignites a can?do attitude among citizens.
Australia is fortunate to have in its midst a resolute champion of human freedom in Wolfgang Kasper. His latest contribution in Quadrant magazine is yet another example of this very point, and his latest contribution should be compulsory reading for all lovers of liberty.