Wednesday, 19 February 2014

Is welfare a trap?

If you're unemployed, you get benefits from Inland Revenue/Centrelink. If you need money to study, you're given student loan and allowances. If you injured yourself, you get ACC compensation. If you're old or a veteran, you get pension.

Living in the west is a golden privilege and honor while in other nations; it's every citizen for him/herself. Of course it's good that the government helps it people but what are the costs?

As the population rises, the bills go up and the government is forced to pay more. It comes to the point where the government is broke and needs to borrow money to keep the flow going. Borrowing money meant increasing debt like the US with almost $17 trillion of debt. The government borrows to the point where lenders will eventually stop and the government is forced to pay back. When a government tries to pay back it's debt, they have to cut spending and this will result in riots, protests and lose the next election. This is because people are stuck in a routine of getting government help and are happy if the help suddenly stopped. This is why welfare is a trap. As a result, politicians (so called educated people who are meant to look after the interests of the people) realize that the only way they could win the election is to make promises they cannot keep.

One good example would be Greece which had over half a trillion dollars of debt. It made austerity measures to repay the debt at the cost of riots and snap elections. In New Zealand, Prime Minister John Key pushed for a budget surplus in order to start repaying the debt at the cost of cutting jobs like hospital kitchen staff and selling state assets. This resulted in unhappy responses accusing Key of selling the nation to foreigners as a result of state assets sale. He worriedly faces a prospect of losing the 2014 General Election with the opposition ahead in the polls. In the UK, Prime Minister David Cameron created an austerity budget but the spending kept going up. Opinion polls stated that he might lose the 2015 General Election.

So would you make painful austerity measures to make the nation debt free and leave the next generation a better future OR keep borrowing money and helping people leaving a huge debt and make the next generation pay the ultimate price? Of course, no matter what political party is in power; the same problems and issues will continue as this world will remain divided and will never be perfect.

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