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If philanthropy is the application of a moral code to redistributive monetary expenditure, a large proportion of the UK government spending is philanthropic in nature.

Ethical responsibility is thus moved from the individual to the state. But this raises the question: whose moral code is being followed by the state?

If Western democracy is viewed as the state being a representative of "the will of the people", then this is tautological (the people will it).

But if instead we take the more realistic(?) view that UK representative democracy is connected to the electorate by coarse, manipulative and inaccurate information; and instead policy is driven by the politico-media complex and civil servants (who may well be operating with the best of intentions); it could be argued that these people do not have the moral authority to impose their own view of morality on the populace.

Given this, why is state-directed philanthropic intervention preferred in the UK versus non state intervention?

Is philanthropy an area where centralised state control is simply more effective?

In an alternative model, national private charities could simply advertise the need (eg homelessness, malnourishment, unemployment) using modern communication technologies that were not available historically, pre-welfare state. Those with wealth could choose to donate (or not). A number of good and bad outcomes would occur and the charities would communicate this, establishing a feedback loop. Donations would rise or fall, and an equilibrium would be reached.

Do any countries repatriate philanthropy to the individual to enable them to follow their own moral code (which would seem to be less authoritarian)?

By philanthropy I mean healthcare, entitlements, social housing, social services, foreign aid and protectionist measures (eg sector subsidies).

Edit: this question is not "why philanthropy" but "why socialised philanthropy (given that the most efficient pricing mechanism AFAIK is the free market)".

UK Gov Spending

Social Protection Spending Split

Sources here and here.

Note: I have edited the title of this question to better reflect the actual question being asked. My apologies for not supplying a good title from the outset. The original title was "Why is such a large proportion of the UK tax spend philanthropic?"

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    But my question remains. What state measures do you perceive to be philanthropic? Unemployment benefits, housing benefits, disability benefits, family benefits, etc. Should we take the examples in the illustration to be the purpose of your question? – armatita Nov 28 '17 at 12:05
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    So your original question basically boils down to "Why isn't the UK an anarcho-capitalist system which lets the old and disabled die in the streets?" Seems a bit broad to me. With your edit, your question contains a lot of unsourced premises about a supposed elite. That seems to be more about promoting conspiracy theories than a question about how governments or the political process work (which would then be off-topic). – tim Nov 28 '17 at 13:00
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    @Ben: Well, what else is there? Private groups do what they want to do, with their own money and labor. Government, to put it bluntly, does it with other people's money, to benefit whatever groups will win them the largest number of votes. – jamesqf Nov 28 '17 at 23:42
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    "is thus moved from the individual to the state" = in a democracy, the people are the state. – user1530 Nov 29 '17 at 16:54
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    But to answer the question: why, it's because if people are left to their own devices, there will be people that are left out. A government is meant to represent all citizens, hence it makes sense for a government to ensure all citizens are taken care of. And, of course, none of that negates private philanthropy. They can coexist just fine. – user1530 Nov 29 '17 at 16:56

10 Answers 10

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All government decisions are moral decisions

The UK's armed forces deploy nuclear weapons. Some believe this to be ethically justified, while others do not. The government is imposing the view of the majority which support nuclear weapons, over the deeply-held objections of a minority.

Moral considerations come into play for all government decisions, not just welfare spending. Indeed, the whole purpose of government can be viewed as making collective moral decisions on behalf of the citizens.

"Philanthropic" decisions have wider consequences

Considering the categories defined as "philanthropic" in the OP:

  • A healthy citizen is a productive citizen. People with a good standard of healthcare are more likely to be able to work and otherwise contribute to society.
  • Pensions are paid to older people who (mostly) have worked and paid taxes for much of their lives, and now receive something in return. So it's highly questionable whether this is "philanthropy".
  • A large proportion of housing and family benefit is paid to people who are in work. In effect, the government is subsidising low pay by employers. (Whether this is desirable in the larger scheme of things is a separate question.)
  • Unemployment benefit is a tiny fraction of the total (1% of welfare spending, 0.25% of all spending). Individuals receiving this benefit are required to demonstrate that they are seeking work.

Considering welfare spending (second graphic in the OP), the majority is paid to people who cannot work for reasons of old age or disability. Even from a utilitarian point of view, they may still contribute to society, for example by caring for children. In addition, recipients of state benefits spend all or nearly all of the money they receive; this has a stimulating effect on the economy, more so than if an equivalent amount of money was held as investments by corporations or high-income individuals.

If there were no social benefits, more individuals would be rendered destitute; this would have wider consequences, for example for child development and crime rates, which could well prove more expensive than simply paying the benefits.

Furthermore, humans are not creatures of pure economic utility. Most of us would prefer not to see starving and diseased beggars when we go out to buy a loaf of bread. UK voters have overwhelmingly expressed their preferences to this effect through democratic elections.

  • Comments are not for extended discussion; this conversation has been moved to chat. – Philipp Dec 2 '17 at 12:42
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I suspect at question is your definition of philantrophy.

"Philantropic" is defined as "(of a person or organization) seeking to promote the welfare of others; generous and benevolent".[first Google result, emphasis mine]

Your question according with this definition is that UK government seems to be promoting the welfare of some others who are not its constituents.

In that case I would say that concept of philantrophy applies only to foreign aid and that the rest of the areas you define as "philantropic" are not such (according to the above definition), as they aim to promote the welfare of UK residents, who are part of the UK. Which is sort of what any government has always been expected to do -- promote welfare of its people.

If your question is more about why UK spends so much on social areas in general (without defining it as philantropic or not), my answer would be that there are a number of reasons, which each by itself do not explain the spending, but all together they create the background on which such spending is deemed advisable (and not only by UK, but by most of succesful states of Western Europe). Some of those reasons would be:

  • Spending on healthcare helps raise average well-being of residents, making more people able to work for longer and thus increasing taxes gathered.
  • Ability of healthcare to help people has risen along with its costs. At this point majority of individuals would not be able to afford most of healthcare, if it was not at least partially state subsidise. Which would defeat the previous reason.
  • In fact, if healthcare was not mass-available, its costs would raise dramatically, so even individuals who at current prices could afford anything, would possibly not be able to afford anything much then.

Etc.

  • Arguing for philanthropy is straightforward, but why is the intellectual consensus to socialise it? – Ben Nov 28 '17 at 12:57
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    @Ben I still find issue with your calling social services being philantrophy. I would say that by a large margin, social services are used by the same people who pre-paid their use in taxes. While UK doesn't follow the actual health insurance path that is done by some other countries, most of social services can be seen much more in terms of mandatory insurance than "philantropy". – Gnudiff Nov 29 '17 at 10:39
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    @Ben After many decades of having an NHS and other state services and benefits, the answer may be that the alternative is unthinkable. As another answer mentions, one only needs to look to a time before these things were provided to see what could happen. Regarding healthcare, the US is a prime example of what can happen if the state doesn't provide it for free. As far as I can tell, many in countries with nationalised healthcare look at the US situation with utter horror. – Steve Melnikoff Nov 29 '17 at 17:08
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    @rinspy Your thought experiment lacks significant points to consider it. Namely, there is not single A and B in a real country. In a real country, much more of the population is in groups A or B, and the C is providing more share per capita, but at the same time usually much less total taxes than A and B groups combined. – Gnudiff Apr 18 at 8:48
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    @rinspy also note that your A isn't just getting that high income in a vacuum, the country he lives in contributes to that, among them obviously B and C. So it's a political give and take, where one subject of agreement is how the health insurance is set up. Yes, the system includes "social" components, but not philantropy. C doesn't need to have any desire to help others, it's simply the outcome of a political process. And it's not a simple A+B vs. C setting either, as in reality A+B will at least consider the possibility to get a higher income one day in their decision as well. – Frank Hopkins Apr 18 at 11:07
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this question is not "why philanthropy" but "why socialised philanthropy (given that the most efficient pricing mechanism AFAIK is the free market)".

The free market has its strengths, it’s good at determining how much people are willing to pay for a non-necessary product for example, but it’s not a panacea. In particular when trying to determine how to meet a shared cost simply asking everyone to pay what they want falls into the Tragedy of the Commons.

In 1833, the English economist William Forster Lloyd published a pamphlet which included a hypothetical example of over-use of a common resource. This was the situation of cattle herders sharing a common parcel of land on which they are each entitled to let their cows graze, as was the custom in English villages. He postulated that if a herder put more than his allotted number of cattle on the common, overgrazing could result. For each additional animal, a herder could receive additional benefits, but the whole group shared damage to the commons. If all herders made this individually rational economic decision, the common could be depleted or even destroyed, to the detriment of all.

In a country of 65 million people, the tax contributions of any one individual are a miniscule fraction of the total amount. If I decided to donate my entire yearly income to the NHS it would still be a tiny drop in the ocean, conversely if I stopped paying taxes entirely the money lost would be barely noticeable. The individually rational decision is thus that I should ignore my negligible effect on the common good and instead keep the money for myself.

The problem comes when everyone, or at least a significant number of people make this same rational decision. Even if everyone in the country is in full agreement over what services to provide and how much to spend in total, there’s still the temptation to skip your individual contribution and let everyone else cover the bill. The point of taxes is that we enforce that everyone pays their fair share.

  • Is the “rational actor” theory not disproven every waking moment of our lives, opening up the possibility that TOTC might not apply? Or is there evidence to support it? – Ben Nov 29 '17 at 1:57
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What do you mean by "the state"?

One view would be that a modern democratic state merely represents "the public will" (as expressed through parliament) - what Rousseau called "la volonté générale".

On that basis your comment seems tautological. If you accept that ultimately the public is the state, and that the public wants philanthropy directed through the state's institutions, then you have your answer.The reason for state philanthropy is because it is the will of the public.

If you challenge, as Joseph Schumpeter did, that "democracy (is) a process by which the electorate identifies the common good, and politicians carry this out for them"(see footnote 1) then that's an entirely deeper discussion.

So you first need to be clear about how you understand "democracy" as it is practised in modern western countries.

  1. Schumpeter argued this was unrealistic, and that people's ignorance and superficiality meant that in fact they were largely manipulated by politicians, who set the agenda. This made a 'rule by the people' concept both unlikely and undesirable. Instead he advocated a minimalist model, much influenced by Max Weber, whereby democracy is the mechanism for competition between leaders, much like a market structure. Although periodic votes by the general public legitimize governments and keep them accountable, the policy program is very much seen as their own and not that of the people, and the participatory role for individuals is usually severely limited. Wikipedia - Joseph Schumpeter.
  • Thank you for this answer. It clarifies in my mind that I do view "democracy" in the same way described by your Schumpeter quotation. The policy programmes espoused by the main parties in the UK all follow the same pattern of delegating philanthropy to the state, and that this philanthropy should be substantial. ie there appears to be an intellectual consensus - but from where and based on what reasoning? cf "philanthropy is the application of a subjective moral code - but whose?" And by what right do the elite have the authority to impose their own code, given that 'democracy' is a charade?". – Ben Nov 28 '17 at 12:16
  • Do I need to restate the question and make my view of democracy clear? – Ben Nov 28 '17 at 12:36
  • @Ben It may be useful to do that, Ben. This could then turn into a very interesting discussion. – WS2 Nov 28 '17 at 12:38
  • I have restated the question. – Ben Nov 28 '17 at 12:43
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    @Ben One historian noted (it may have been Arnold J. Toynbee) that what would primarily characterise the twentieth century, over all its predecessors, would not be its advances in science, medicine, technology etc - but that governments would accept for the first time that their first duty was the welfare of their citizens. One could undoubtedly go back to an age when governments did not concern themselves with social welfare, indeed some argue that we are on our way there already, but I for one would not like to be part of that journey. – WS2 Nov 28 '17 at 14:04
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The spending I perceive to be philanthropic covers healthcare, all entitlements, social housing, social services, foreign aid and any protectionist measures (eg sector subsidies).

As you can probably guess each of those elements has its own background. Nevertheless I would argue that the most recent historical event that directly influenced our modern (hmm..., some) states is the Universal Declaration of Human Rights (UDHR) signed little after World War II. Let me quote Article 25 (emphasis is mine):

Article 25.

(1) Everyone has the right to a standard of living adequate for the health and well-being of himself and of his family, including food, clothing, housing and medical care and necessary social services, and the right to security in the event of unemployment, sickness, disability, widowhood, old age or other lack of livelihood in circumstances beyond his control.

(2) Motherhood and childhood are entitled to special care and assistance. All children, whether born in or out of wedlock, shall enjoy the same social protection.

The UDHR, although not international law, has indeed served as leverage for several legally binding treaties and almost certainly contributed greatly to the national law of many nations. The UDHR is not the philosophical or practical beginning of many of the measures you've mentioned but it declared a minimum standard for which all national programmes henceforth would be compared against.

Many social security systems (welfare) existed prior to UDHR (UK included). The advantages are evident (see for example this table) and research indicated that more social spending did not contribute to losses in productivity. In fact:

According to the OECD, social expenditures in its 34 member countries rose steadily between 1980 and 2007, but the increase in costs was almost completely offset by GDP growth. More money was spent on welfare because more money circulated in the economy and because government revenues increased. In 1980, the OECD averaged social expenditures equal to 16 percent of GDP. In 2007, just before the financial crisis kicked into full gear, they had risen to 19 percent – a manageable increase.

So the even though it may seem to you that the reason is purely moral, it is not. There are pragmatic evident advantages to the existence of the measures you've mentioned.

  • I like this answer because it speaks to why philanthropy is socialised which is the crux of my question. I do not doubt philanthropy is good. But philanthropy can/will still occur if the government does not compel it. – Ben Nov 28 '17 at 12:55
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    philanthropy can/will still occur if the government does not compel it. But which level of necessities would be covered by "voluntary philantropy"? Are you guessing that if government ceased to act, all of those activities would be picked up by public philantropy? – SJuan76 Nov 28 '17 at 13:12
  • I am saying that the morality of the people would be emergent. It may be that on average philanthropy would be higher, lower or the same, directed in the same way, or different. But the morality would be the true morality of the people instead of a simulacrum imposed by a proxy. – Ben Nov 28 '17 at 13:17
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    The tragedy of the commons comes into play. I may agree that we need to spend X money in that, but without compulsion I may opt to keep my money and wait for my neighbours to foot the bill. And my neighbours may do the same... – SJuan76 Nov 28 '17 at 13:26
  • OK thank you. I wonder if there are any other approaches that avoid TOTC but are less authoritarian. – Ben Nov 28 '17 at 13:33
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There are several reasons why UK and most West-European countries have what you call state-philantropy.

Public health

I guess that you are from the US, and so you should have a thought about a fact : West Europe is more dense than US. It seems irrelevant, but it means if someone gets sick in Europe, he will probably contaminate more other people. So everyone has an interest that everyone else get healthcare.

I do not know about UK, but in France there was a debate some years ago about if we should, or not, give free healthcare to poor illegal immigrants. One of the main argument for giving it was that if you do not, you will have to treat more people and ultimately it will be more expensive for everyone.

Efficiency

Another reason is that there is an economic phenomenon that makes private philantropy less efficient than mandatory philantropy. Philantropy is like a firework : if you choose to make a firework in your city, everyone in the city will see it. So you have two choices :

  • either you ask everyone to give you money for the firework (private philantropy)
  • or the city decides how much it wants to pay for the fireworks and funds it by taxes.

An economical reasonning can prove that the second option is in the best interest of everyone (provided that the tax system is fair). I am not able to reproduce it here, but the idea is that after some point, you will accept to give more only if everyone else does so.

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But if instead we take the more realistic(?) view that UK representative democracy is connected to the electorate by coarse, manipulative and inaccurate information; and instead policy is driven by the politico-media complex and civil servants (who may well be operating with the best of intentions); it could be argued that these people do not have the moral authority to impose their own view of morality on the populace.

Where does their view of morality end and that of the populace begin? In representative democracies the party in power has some democratic mandate to implement the policies in its manifesto and other material voiced and published in the run-up to the elections. The civil servants have a duty to implement what the Government lawfully decides. All politicians and civil servants are members of the public too.

In the UK there isn't a significant political party or media outlet in the UK that publicly advocates for entirely getting rid of "state philanthropy". Nor is libertarianism a mainstream political tradition in the UK.

I think across Europe the broad intellectual and public consensus is that there are some things which should not be left to the free market. That while we argue about how much to spend and the burden on public finances, the details of how much and what welfare or healthcare should be publicly funded and who is deserving or undeserving, and despite the anger caused by specific cases (particularly edge cases, e.g. woman on benefits has 20 children), there is belief in or support for in principle some minimum threshold or standard below which the state shouldn't let people fall. It is a moral imperative.

There's a lot of history here (the Wikipedia article, poor laws article and cites may be worth your time) and perhaps some of the intellectual or public consensus is 'legacy code'. Our beliefs and thoughts are shaped by our environments. The systems we have grew 'organically' over time - as has been said of of the tax and welfare system, we wouldn't design it from scratch the way it is today. And not all forms of welfare have been provided with the sole intention to protect the poor - Bismarck for example promoted it to wrongfoot his socialist opponents. Similarly a party that proposed to entirely abolish the NHS in favour of a completely free market model would be unlikely to do well in the present and past climates.

I don't know if people forget or don't know we did have free market welfare before state welfare - and we have state welfare today because of that. Without state intervention many more people would be worse off and even die - that is the stark reality politicians and other well-meaning individuals must take into account.

  • Bismark's social welfare laws were modelled on the welfare system which was implemented by the Alfred Krupp. In short, Krupp (the company) cared well for its workers as long as they behaved, i.e. did not unionize, etc. In this case, private philantropy served as the carrot (workers recieve benefits) and the stick (workers loose the welfare along with their job if they misbehave) – Dohn Joe Apr 16 at 16:06
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Why state-controlled?

Apart from the angles given in the other answer, one thing particularly comes to mind: universality.

Private philantropy is per-definition privately controlled. Let's imagine a world with 100% private philantropy and no public social security in place. If I was agitating against the rich, while I had work and could sustain myself, I am fine. However, if for some I become for some reason unemployed/homeless/sick and I am in need for help (unemployment or housing benefits, health care), how big are my chances to be granted such help?

A state-controlled system is inherently neutral. Some bureaucrat checks the eligibility, and if I am eligible I will receive the help I need. No matter how horrible a person I am.

In a private setting, we tend to favour the people we like, or we find sympathetic. People we dislike, are less likely to recieve our help. Also people we know are more likely to get our help, than total strangers.

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Ethical responsibility is not ‘moved’ from the individual to the state. It’s delegated. That’s the point of representative democracies. In the UK, that sovereign power is invested in parliament.

Private philanthropy has its place, but it’s major defect is lack of transparency and lack of accountability.

This is why, despite massive grass-roots campaigns, green energy policies has only tardily been taken up by energy companies. They’re simply not accountable enough.

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This is a false dichotomy.

Most states, including the UK, have both state-controlled and non-state-controlled philanthropies.

I've not seen any evidence as to whether one is preferred over the other, either in the UK in particular or more generally.

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