The costs and spoils of social engineering


sweden.jpg Sweden is often depicted as a Social Democratic paradise. However, her welfare state has achieved less and cost more than most believed. The point is that wealth distribution and flat income have not significantly changed after Sweden expanded her welfare programmes during the 1950s and 1960s, when workers enjoyed lower taxes and worked more hours. Yet what has changed dramatically is the effect of social engineering on immigration, basically creating welfare dependency and preventing integration.

Integration worked well in the first decades after the war with immigrant employment rates 20 percent above the Swedish average. By contrast it is now 30 percent below that average with only half of non-EU immigrants holding jobs. The combination of a highly regulated labour market and lavish welfare payments is keeping immigrants out of jobs. The comparison with the US with much less welfare arrangements is striking:

Given the high barriers to entry, many immigrants in Europe no longer start accumulating essential language and labour market skills. This is in stark contrast with the situation across the Atlantic. For example, in 2000, Iranians in the U.S. had a family income that was 42 percent above the U.S. average. The income of Iranian immigrants in Sweden, however, was 39 percent below the country’s average.

Even more worrying is the nexus between unemployment and successful integration of immigrants. Countries such as Australia and the U.S. that reward hard work and entrepreneurship are doing much better with integration than welfare obsessed Europe. Welfare dependency has a detrimental effect on immigrant communities, because immigrants tend to regard their lower standing as a result of discrimination and racism thus fuelling social tensions. This is not the Liberation from want that was intended ‘Social Europe’ was intended to achieve.