"Does the Welfare State destroy the family?"

A report from the Sydney Morning Herald caught my eye.  The New South Wales Finance Minister, one Dominic Perrottet, is complaining that the welfare state undermines family life.  He believes that

  • the welfare state ‘crowds out’ the family by doing what families would do otherwise, so people don’t form families.
  • people who can look forward to pensions won’t have children to support them in old age
  • social assistance to lone parents makes divorce easier.

So, whereas in Britain some politicians and journalists are utterly convinced that welfare encourages women to have babies, Mr Perrottet seems equally convinced it encourages them not to.  People who are determined to criticise welfare systems, it seems, will reach for any argument to hand.

The oddness of the report doesn’t stop there. The newspaper cites a contrary view from a paper by three Austrian economists, Does the Welfare State Destroy the Family? , as if it was authoritative.  It claims to show that

“an expansion in the welfare state increases the fertility, marriage, and divorce rates with a quantitatively stronger effect on the marriage rate. We conclude that the welfare  state  supports  family  formation.  Nevertheless,  we  also  find  that  the  welfare  state decouples marriage and fertility, and therefore, alters the organization of the family. “

(The last sentence I’ve cited here is in the paper, but not in the newspaper article.)

The position is tenable, but the evidence they bring to bear isn’t.  They get to this conclusion by mapping figures for public expenditure on welfare on demographic factors.  At this level of aggregation, an analysis can throw up any number of bizarre associations – we know, for example (from classic work by Harold Wilensky) that welfare expenditure is positively correlated with military expenditure, with higher numbers of older people and the overall wealth of the country.    This sort of number-crunching has to be handled with tongs.

We can speculate about the effect of having more soldiers or pensioners, but the broad finding that welfare states have more stable families most probably means only that people in richer countries get to have  more comfortable lives. The underlying problem for families is not welfare, but poverty.   Poverty fractures families, undermining the traditional position of ‘breadwinners’; it affects women disproportionately.  Welfare systems in general, and social assistance in particular, are responding to that situation; they’re not making it happen, any more than hospitals are the cause of broken legs.




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