Monday, April 18, 2011

Ethnic Heterogeneity in America and the Welfare State

This is just a quick thought on Douthat's NY Times column today.  In it he says:

They could have ugly political consequences as well. Historically, the most successful welfare states (think Scandinavia) have depended on ethnic solidarity to sustain their tax-and-transfer programs. But the working-age America of the future will be far more diverse than the retired cohort it’s laboring to support. Asking a population that’s increasingly brown and beige to accept punishing tax rates while white seniors receive roughly $3 in Medicare benefits for every dollar they paid in (the projected ratio in the 2030s) promises to polarize the country along racial as well as generational lines.

This isn't the research I'm most familiar with, and I'm not going to take the time to go brush up on it for a quick post.  However, while there are some finding regarding ethnic heterogeneity and the welfare state, most of this amounts to trying to explain why the US welfare state is so small.  The rest of the countries that have reached the point of development where a welfare state makes sense amounts to pretty much the US, Australia, Canada, Japan, and New Zealand,  with a few micro-states thrown in (which I don't accept as comparable to full sized nation states for most purposes).  None of these countries have ethnic heterogeneity at US levels, and of the two closest Canada is well within European norms and Australia is noted as a major primary producer, which is also given as an explanation for a small welfare state.

More broadly, I've read that Sweden has been experiencing a fair amount of immigration and its institutions are intact.  It's also notable that a country more diverse than America, Brazil, has been experiencing rapid economic growth along with a large growth in social transfers, though I doubt this has reached the levels of the modern welfare state given their current level of development (I don't know, but wouldn't be surprised either way).  On the whole, this leads me to believe that the ethnic heterogeneity argument is rather weak, we're seeing reasons to question it and the US is such an outlier on any issue involving redistribution and the size of the state for the past 30 years that it skews any regression analysis done on these variables strongly.  I don't find this argument at all compelling, it strikes me as an excuse to not even try, not a reason it wouldn't work.  If Brazil can go in this direction, surely we can.  I've always believed that probably the biggest single factor in US success has been our ability to successfully integrate immigration and our relatively welcoming attitudes towards immigrants.  I'm willing to bet on that, even given the nasty populism of the day, rather than just throw in the towel and say we can't maintain a first world safety net.

Surely any real American thinks we can at least do as good as Europe?  Come on, where's American exceptionalism when we're actually asked to do something?  If Europe can sustain the welfare state with their much worse demographics surely we can with much better demographics along with assimilating new immigrants.

This can't be repeated often enough:

The New Colossus
Not like the brazen giant of Greek fame,
With conquering limbs astride from land to land;
Here at our sea-washed, sunset gates shall stand
A mighty woman with a torch, whose flame
Is the imprisoned lightning, and her name
Mother of Exiles. From her beacon-hand
Glows world-wide welcome; her mild eyes command
The air-bridged harbor that twin cities frame.
"Keep, ancient lands, your storied pomp!" cries she
With silent lips. "Give me your tired, your poor,
Your huddled masses yearning to breathe free,
The wretched refuse of your teeming shore.
Send these, the homeless, tempest-tost to me,
I lift my lamp beside the golden door!"


  1. Thank you for bringing up that the Scandinavian countries, especially Sweden, are some of the more ethnically diverse in Western would these days.

    But, I still think you should discard ethnicity out of hand, because what is needed for a government to be able to grow to a size big enough to run an efficient welfare state is social capital, and that might be easier to accumulate and maintain in more homogeneous societies.

  2. JGradus,

    I may have been a bit too harsh on the concept. But my point was to push back against views that I see as determinist regarding it. Ethnicity matters, the question is how much. In the US we pride ourselves on how deep our social capital is, people here like to point to Tocqueville a lot for this. We also see ourselves as having retained it through earlier waves of immigration and slavery. Just like in the past there are groups saying, well, that was then, but this new challenge is different. My point is that this form of defeatism isn't helpful. America rose to its earlier challenges successfully, and the differences between then and now aren't as large as they're played up to be. If America doesn't manage this, it's the culture that's broken, and not the situation that is too hard.