The first principle of economics is that there is no such thing as a free lunch. So it should come as no surprise that Taiwan's economists have not, out of some sudden outburst of altruism, started to provide their services without the possibility of getting something in return. So we need place no stock whatsoever in the words of the economists at the National Conference on Social Welfare Services Development, or in their maliciously warped but clear differentiation between a "compulsory individual savings system" and a "compulsory social insurance system."
All in all, this educational farce was just a typical exercise in political brainwashing, in which the economists had no qualms about relying on their academic credentials to cheat the public into agreeing to sell themselves out in a Faustian pact.
The conference delegates agreed that a social insurance model would be the most appro-priate for the national annuity system. But Minister without Portfolio Hu Sheng-cheng (胡勝正) said that there are in fact different kinds of social insurance systems, and that the endowment insurance version proposed by the Cabinet also has a strong social insurance element. The Cabinet will therefore maintain the original endowment insurance plan as the foundation of the system, but "respect," he said, the many other suggestions made at the conference by changing the name to "social insurance system A" in order to emphasize the social insurance element. It would then re-submit the proposal to the Legislative Yuan for review.
This crude and contemptible method of simple relabeling reveals the violence of the Cabinet expert's language and its complete lack of genuine respect for public opinion. The "historic" conference has been clearly shown for what it really is -- an attempt to win public endorsement for the government's proposal. Even though the government's position has been opposed by all the "malicious people" [of Taiwan], it remains unshaken.
Could it be that the arrogant economic experts, who have always emphasized the strict and clear definition of concepts, lose their ability to clearly tell black from white once they become public servants? A compulsory individual savings system neither bears any relation to social realities, nor contains a rationale for collective risk sharing. Its principles of payment determination conflict with those of social insurance systems. When it comes to the demands that such a system would make on the political system, it raises issues related to the fundamental distinction between authoritarian dictatorship and liberal democracy.
For scholars advocating a Singapore-style authoritarian paternalism, compulsory individual payments are clearly a matter of starting us out on the road to capitalist prosperity by killing two birds with one stone: such a system avoids the demands for social justice that are heard in true liberal democracies, yet it may delay the social upheaval that can be caused by an unequal economy and poverty. This is precisely why we do not see economists protesting that a compulsory endowment insurance system would violate individual freedoms. Economists have either never believed that there is such a thing as "society," or that if there is such a thing it is nothing more than a collection of individuals grouped together in a search for maximum financial gain.
We could ask whether these politically packaged strategies which involve the distortion of facts and the use of deceptive language, imply that the "third way" is being undermined and is effectively destroying itself. The third way, or the "new middle way," popular in Europe and the US in the 1990s, is not only falling apart very rapidly, but, is leaning rightward. It has provided nationalists on the extreme right with ammunition for use in whipping up anti-foreign sentiment and generating popular support.
Leaving aside the rejection of the third way in the US and in parts of Europe -- from Austria to France and the Netherlands -- even the German Social Democratic Party and the UK's New Labour, also practicing the "third way," have seemed vulnerable in elections. Observers say that the practitioners of the "third way" are often too extreme, as they adjust their policies in a rightward direction in order to attract new voters from the political center. This leads to their being unable to solve the increasingly serious issues of social security and the economic plight of workers and they are increasingly losing the crucial support of the people who voted them into office in the first place.
The "third way" is now incapable of fulfilling its promise to promote economic growth while simultaneously guaranteeing social security. It is also bringing us toward the deadly allure of -- and the apparent paradox of simultaneous collaboration and conflict between -- the extreme left-wing and extreme right-wing forms of authoritarianism, about which Karl Polanyi warned us in his book, The Great Transformation on the eve of World War II. We thus risk being denied the very basis of individual freedom and dignity by war and slaughter on a grand scale.
On the one hand, the economists' promotion of compulsory individual savings is a by-product of this apparently paradoxical dynamic, and, on the other hand, it may be that their "active" leadership brings yet closer humanity's ultimate annihilation. The people of Taiwan, concerned about the issue of unification or independence, are waiting to see how China establishes a system of compulsory individual savings and how economic experts will connect this system to Taiwan's social security system. A unified mindset completely fixed on the sinicization of global free markets and on Tai-wanese investments in China makes our economists the political executioners of the "third way."
Chang Shr-syung is an associate professor of social welfare at National Chung Cheng University.
Translated by Perry Svensson
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