When Prime Minister Freundel Stuart recently put Barbadians on notice that they will be expected to carry “more of the weight” going forward, instead of continuing to fully rely on Government to provide certain vital social services, he was essentially speaking of a roll back of the welfare state.
Stuart was roundly criticized for the statement which some contended was evidence of a leader who was out of touch with the reality of the average Barbadian. However, interestingly enough, similar debates are also taking place in other countries, especially the developed world, as concerns about mounting public debt are forcing governments to have second thoughts about providing social services on as generous a scale as before.
Since Barbados attained Independence from Britain in 1966, the state has played a pivotal role through various welfare programmes that have contributed collectively to improving the quality of life for Barbadians to a level comparable with what exists in many developed countries. The main focus was the provision of education from primary to tertiary level and wide ranging health care benefits.
Speaking against the backdrop of an unprecedented level of public debt which is among the highest in the Caribbean, Stuart remarked: “The first 50 years of Independence were years of entitlement, but the next 50 years of Independence cannot again be years of entitlement because we have now built a middle class in Barbados.” He said Barbadians had reached a level of development where some persons can now be weaned off welfare benefits.
The Barbadian welfare state, which began in the pre-Independence period, was expanded during the tenure of the Right Excellent Errol Barrow who was the first post-Independence Prime Minister. The decision was probably influenced by the fact that Barrow was exposed to Fabian socialism in Great Britain during the Second World War when the welfare state took shape, pushed especially by the 1942 report of Liberal politician and economist Sir William Beveridge, which led to the creation of the National Health Service and other support for citizens “from cradle to the grave”.
The Beveridge Report, which was presented to Parliament, provided a summary of principles necessary to banish poverty and “want” from Britain. It proposed a system of social security which would be operated by the state, to be implemented at the end of World War II.
“Social insurance fully developed may provide income security; it is an attack upon want. But want is one only of five giants on the road of reconstruction and in some ways the easiest to attack. The others are disease, ignorance, squalor and idleness,” Beveridge said.
Along with the concerns about unsustainable public debt, the worldwide switch to the neo-liberal model of development as a consequence of globalization, with its emphasis on virtually unfettered market forces instead of state intervention, is the other factor influencing attempts to dismantle the welfare state which, generally speaking, has served the citizens of countries well.
In the latest attempt, the United States Congress voted to dismantle Obamacare, which provided health benefits to millions of Americans who could not afford private insurance. The move was in support of the agenda of new pro-market president Donald Trump.
The highly respected Indian-born development economist and Nobel laureate Professor Amartya Sen, who has spent his career studying welfare economics, contended in a BBC interview that high levels of debt did not constitute a sufficiently strong reason for dismantling welfare benefits to citizens. He noted that when the British welfare state was introduced, the ratio of public debt to national income was over 200 per cent.
He also disagreed with the typical government response of introducing austerity measures. What was required, Sen argued, was a focus by governments on policies that promoted high economic growth which, in turn, would make the debt easy to manage. He mentioned the case of the Clinton administration in the US which found a big deficit on assuming office in Washington in 1992 but through high growth policies was able to eliminate that problem.
Is there a lesson for us here in Barbados with Government either cutting or warning of cutting?
In a climate marked by contracting output and anaemic growth, Professor Sen’s thesis, which calls for greater focus on high growth policies, does seem to hold validity. At least, it represents a far better option than austerity.