The Welfare State: a Jigsaw Puzzle?

State and welfare – can the two go together? It takes two for a tango, and there are apparently parts of this world where the two stay close nevertheless are artfully in motion. The counties highest on the ladder of life satisfaction are the Nordic welfare states Denmark, Finland, and Norway. Sweden, the fourth and perhaps most well-known Scandinavian welfare state is not lagging far behind its neighbours. Today, all four are vibrant market economies where an export-oriented big business thrives, and has done so since the days of Alfred Nobel. These are imagined welfare communities that stress democratic accountability, environmental sustainable, equality, investment in research and development (Sweden on par with Korea), strong public institutions, social justice and national and nowadays also international cooperation and solidarity. These communities are also high tax states where public income is generally regarded as private deposits in a national ATM that redistribute social welfare benefits and services fairly evenly. Despite their present success, the world looks with suspicion on these countries. Their way of workings do not go well together with received wisdom. Intuitively, there is something fundamentally wrong with them. Thus, the welfare state is still a dilemma for contemporary global thought and practice. In Korea, this is visible almost every day as the presidential campaign goes on. Welfare and state do not easily go together, neither here nor in many other parts of the world. Nevertheless the combination works. The Nordic countries do surprisingly well, these days also in macroeconomic terms. Four years ago, the Royal Academy of Science awarded the Prize in memory of Alfred Nobel to EllinorOstrom, who passed away this spring. As a starter, I hint at her work as a partial answer to questions posed by the welfare state experience. The explicit recognition of the right of regional and local authorities to levy taxes to finance public tasks – initially predominantly education and health, later also housing and personal old age, disability and family/child services – became a foundation for later expansion of social policies and democratic practices with the advent of industrial capitalism and class politics. New human associations in civil society such as agricultural producer cooperatives, employers’ federations and trade unions came to legitimize and substantiate growing public welfare responsibilities and an emerging adjacent administration of civil servants and professionals. Today, regional and local governments – the main providers of welfare – are constitutionally on par with each other, and interdependence on the sub-national level of public bureaucracy is characterized by cooperation and coordination, not hierarchy and tutelage. This institutional set-up is supplemented and supported by national welfare policies and programs. Thus, the importance on the one hand of the regional and local power to levy taxes – income tax in particular – and, on the other hand, constitutional coherence and rigour in decentralizing political power and responsibility are two core issues to be further discussed in context of the challenges posed in contemporary Seoul and Korea. Following these cornerstones a sustainable welfare society has been built and enlarged in Scandinavia based on noncorrupt public and private organizations; the rule of law and non-partisanship. Nevertheless, conflicts over money and resources between competing social and political forces have been a recurrent theme throughout the expansion of the Swedish welfare state both on the national and the level of regional and local government. Hence the transformation of century-old authority into a modern republic is still an invitation to bold approaches to the future in Korea as well as Sweden, and improved prospects of a civilized and enlightened human world.