Welfare State: Fright or Death

Abstract

“Welfare State: fright or death” is the second paper in a trilogy on the challenge of reforming welfare state to guarantee civil and political rights as well as basic social welfare sustainability. The first paper, “Burgers and efficiency, from the state of welfare to the society of welfare” explained the causes of the chronic and systemic inefficiency of the public sector and proposed the Three S theory (suppress, substitute, simplify) as the only solution. This paper presents the reasons that triggered the change, as well as the convictions, conveniences and constraints resulting from four classic debates: the ethical debate (freedom vs. equality), the political debate (liberal democracy vs. social democracy), the economic debate (Keynes vs. Hayek) and the most recent legal debate. It also establishes the rules regarding budgetary stability and deficit control in Spain.