The welfare state: an alibi or a mafia lord?

The welfare function of modern states has a disproportionate effect on the way citizens perceive the state.

by Pranay Kotasthane (@pranaykotas)

Economist Bryan Caplan in his latest EconLog post explains how the welfare function of a state melts the conscience of its citizens. His contention is that human beings tend to lose objectivity when they witness a highly emotional act such as philanthropy. This applies even to individuals who are merely observers, and not just those who are recipients of the philanthropic act. This loss of objectivity means that individuals are likely to forget or obfuscate the previous acts of wrong-doings by the benevolent actor.


How does this relate to the state and its citizens? The author claims that one such apparently benevolent actor is the welfare state itself. A government of a welfare state may display acts of philanthropy towards its citizens, fully aware of the cognitive bias of its citizens, which tends to give a higher weightage to acts of philanthropy. The agents of the welfare state may then use this illusion to commit acts of corruption and impropriety.


The author says that welfare states..

melt people’s consciences, leading them to excuse and minimise the most horrible of crimes.


Caplan further suggests:

when organisations that kill people for a living – like crime families or governments – loudly help the needy, we should indeed shudder.  Why?  Because their perceived philanthropy makes it easy for them to get away with murder.  Maybe they’ll use their power over life and death wisely and fairly.  But they probably won’t – especially if they’re surrounded by devoted fans eager to excuse their shortcomings.


Beyond this libertarian argument, there are two other observations to be made about this relationship between a welfare state and its citizen.
First, a welfare state can end up becoming a perfect alibi for the selfish citizen. A marginal citizen is likely to refuse taking up acts of compassion, empathy or philanthropy. This is because he/she considers that the execution of these functions are the raison d’être of a welfare state. Why should then he/she take the initiative of helping others out? Such a citizen is likely to claim that his/her contribution to taxes is by itself his/her generous contribution to the society. The result of this dereliction of duty is that a welfare state has few competing philanthropic agents. The lack of competition reinforces the bias which makes us ignore its crimes. Acts of wrongdoings by governments then become fait accompli — almost as a collective cost that the society necessarily needs to incur in order to  ensure that the state performs its welfare role.


Two, citizens need to keep a constant vigil on a government that grandstands its welfare role. A citizen needs to be sceptical of governmental actions, ensuring that governments do not easily get away with some other not so charitable acts. The good news is that in republics such as the Indian state, even the government is subject to the authority of the constitution. The constitution then becomes the reference point that citizens should evaluate all government acts with, on every single occasion, regardless of its importance as an agent of welfare. Citizens of some other states are not as lucky: often the reference point is itself subservient to the government or to a party.
Pranay Kotasthane is a Research Fellow at The Takshashila Institution. He is on twitter @pranaykotas

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