Thread: The rise of welfare feudalism? Unreal!

Even Milton Friedman seemed uncertain about this issue. According to Bryan Caplan, Friedman was once asked whether immigrants might be given a legal right to work, but not the right to claim welfare benefits:

http://clubtroppo.com.au/2008/07/20/the ... feudalism/

(This is so much to digest.)

The rise of welfare feudalism?
Posted by Don Arthur on Sunday, July 20, 2008

Support for the welfare state is often based more on chauvinism than a desire for justice, says Will Wilkinson. He argues that if first-worlders really care about improving the lot of the poor we should open up our economies to trade and allow more poor foreigners to cross our borders in search of work.

One of problems of allowing free immigration is that it threatens to undermine the welfare state. When Milton Friedman was asked whether the United States should open its borders, he replied : "Unfortunately not. You cannot simultaneously have free immigration and a welfare state." As Jason Soon explained , "the open-ended availability of welfare is the main reason most libertarians don’t take a purist ‘open borders, free movement of labour’ line on immigration."

Will’s solution to is to allow foreign workers access to the labour market, but deny them access to welfare entitlements. And if that isn’t possible, then he argues that the next best solution is to promote illegal immigration.

Not surprisingly, this kind of talk alarms conservatives. In a recent post Daniel Larison attacks Will for indulging in "morally bogus debates about whether caring for the poor means abolishing borders and swamping our country with millions of immigrants." But aside from insisting on a distinction between patriotism and nationalism and stressing the need for loyalty among those who share a common national identity, it’s not clear exactly why Larison thinks Will’s argument is bogus.

Even Milton Friedman seemed uncertain about this issue. According to Bryan Caplan, Friedman was once asked whether immigrants might be given a legal right to work, but not the right to claim welfare benefits:

Q: Instead of a green card [resident alien status], can the USA issue a blue card which does not give welfare?

A: If you could do that, that would be fine. But I don’t believe you can do that. It’s not only that it is not politically feasible, I don’t think that it is desirable to have two classes of citizens in a society. We want a free society. We want a society in which every individual is treated as an end in themselves. We don’t want a society in which some people are in there under blue conditions, others are in there under red conditions, others are in there under black conditions. We want a free society.

This seems clear cut, but it may not have been Friedman’s final word. According to some sources, Friedman also argued that illegal immigration from Mexico was a good thing. In Will’s opinion: "Anyone really committed to Friedman’s stated view about welfare and immigration should by no means try to restrict immigration, but instead should try to enable illegal immigration."

There’s a similar debate in egalitarian circles. Some egalitarians argue that it’s unfair that people who are lucky enough to be born into first-world countries have access to high wages and generous welfare system, while those born in other countries do not. They say that the first-world has a moral obligation to equalise opportunities across the globe.

The liberal philosopher John Rawls argued that inequality is unjust unless it is created by arrangements that benefit society’s least advantaged (this is known as the ‘difference principle‘). Some egalitarians want to apply the principle globally. But in ‘The Law of Peoples‘ Rawls wrote:

Although I think the difference principle is reasonable for domestic justice in a democratic society, it is not feasible as a way to deal with the general problem of unfavourable conditions among societies. For one thing, it belongs to the ideal theory for a democratic society and is not framed for our present case.

As Canadian philosopher Joseph Heath argues, the only way Rawls’ theory would allow the difference principle to be applied on a global scale would be the creation of a world government.

Egalitarians who follow Rawls can plausibly argue that restrictive immigration policies are consistent with social justice. But what about illegal immigration? In his book The Decent Society, the Israeli philosopher Avishai Margalit wrote:

For Rawls the just society is founded on a contract among its members, which guarantees just institutions for the partners to contract. Even those with the most inferior positions in the just society are still considered members of the society. But the worst problems of humiliation in the modern world are often those of people who are not members of the society they live in — people who do not belong. Perhaps the least advantaged people in the United States today are the illegal Mexican immigrants whose lack of a work license turns them into serfs, if not degraded slaves, of the employers who keep them and hide them. These Mexicans are not members of society. They are not American citizens, and are not taken into account when considering who is the least advantaged in American society (p 274).

Margalit’s observation highlights a contradiction in the views Will attributes to Milton Friedman. If Friedman was opposed to a society where different categories of resident are treated as if they belong to separate castes, he could hardly support a society that turned a blind eye to illegal immigration.

As the populations of many first world nations age, the idea of allowing guest workers will become more and more attractive. But it also raises the possibility of a world where citizenship becomes less about geography and culture and more about membership of a much more abstract kind of society — a society which exists primarily to provide its members exclusive access to welfare entitlements and other forms of social protection.

Conceivably, this could lead to a kind of ‘ welfare feudalism’ — a situation where the sick, unemployed and ageing citizens of wealthy developed nations increasingly live off taxes paid by non-citizens. Instead of being a pact between generations, the welfare state would become a kind of hereditary property right. As the supply of working age citizens declines, opposition to migrant workers would also decline. But in return for access to the labour market, non-citizen workers would be required to pay a form of rent — they would pay taxes to support the welfare state, but would not be entitled to draw on it themselves. Only the most productive and qualified immigrants would be granted citizenship status — those who pay more in tax than they draw in welfare.

In the nightmare world of welfare feudalism, old and sick immigrants would be detained and then deported. High rates of taxation combined with the lack of welfare entitlements would create incentives for illegal immigration. As a result, much effort would go into policing the borders and prosecuting employers who hire undocumented labour. Any feelings of guilt that citizens might suffer could easily be alleviated by promoting the idea that all foreigners are potentially dangerous.

At least two things will prevent this nightmare from becoming a reality. The first is that developed nations will increasingly require citizens to fund their own education, healthcare and retirement. The second is that large parts of the developing world will turn into new parts of the developed world. Wages and living standards will rise and novel welfare state arrangements will develop. Exploitation depends on a large gap between the wages and living standards available in today’s developed countries and those countries that supply migrant labour. If this gap diminishes, so too will opportunities for exploitation. Mobile capital, free trade and the global exchange of knowledge could all help to shrink the gap.

Welfare feudalism mightn’t be much good as an exercise in futurology, but it could be a great idea for a dystopian novel.