Wednesday, July 14, 2010

Can The European Welfare State Survive?

Can The European Welfare State Survive?


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    The generous social welfare system in Denmark and other members of the European Union generally provides free health care, long-term unemployment support, liberal vacation time, and solid maternity and child care benefits. But this pillar of the EU is under economic and demographic pressure.
    phatfreemiguel via flickr
    The generous social welfare system in Denmark and other members of the European Union generally provides free health care, long-term unemployment support, liberal vacation time, and solid maternity and child care benefits. But this pillar of the EU is under economic and demographic pressure.
    Third of five parts
    One of the defining ideals of the European Union has been its social support system, often referred to as the European welfare state. The shared belief among EU nations that the state has a responsibility to care for its citizens has become a kind of common culture, unifying 27 different nationalities.
    But the European welfare system — largely put in place during the high-growth years following World War II — is under economic and demographic pressure. And the recent debt crisis is shaking the foundations of the European Union's shared social vision.

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    Anders Dalsager and Margit Larsen are graduate students at the University of Copenhagen. Like all Danish students, they study for free and receive a monthly stipend equivalent to about $900 per person from the government.
    On a recent day, the married couple walked to pick up their 2 1/2-year-old daughter, Astrid, from the campus kindergarten.
    Dalsager and Larsen say they were able to afford having a child, even though they don't yet have jobs, because the government also gives them a child care subsidy.

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    "As a regular student, you get five years of support, and then if you have a child, you get extra support from the government — 12 months if it's the mother and six months if it's the father," Dalsager says.

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    Welfare Cuts Trigger Strong Protest
    Indeed, governments from Germany to Spain are enacting austerity plans and spending cuts to try to reduce national debts and rein in public spending. But these reforms are being met with resistance — and not just in Greece.
    Germans are angry about cuts in social spending. In France, hundreds of thousands of workers have taken to the streets in recent weeks to protest President Nicolas Sarkozy's plans to raise the retirement age from 60 to 62.
    The French government says workers must stay on the job longer to keep the state pension system afloat. But protesters say there is plenty of money — if you tax the bankers and stockbrokers instead of bailing them out.
    Francois Couder, 43, began working at the age of 17 laying underground cable in hazardous conditions for state-run France Telecom. The company has since been privatized.

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    Testing Denmark's 'Flexicurity' System
    But the streets of Copenhagen bustle with well-off and happy-looking people. Denmark also has one of Europe's lowest unemployment rates — about 5 percent. That's largely because of a system called "flexicurity" that gives employers the freedom to hire and fire, while the state supports laid-off workers with generous benefits and retraining.

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copenhagen2_wide.jpg?t=1278964203&s=4 (116 KB)
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