When John Paul II published Centesimus Annus in 1991, the encyclical opened new vistas for the understanding of the relationship between markets and morals, between respect for private property and consumer habits tempered by Christian moderation. He called for exploring new ways to combine the operation of the market with the support of the weak. John Paul's challenge is even more urgent today when people understand that communism is not a viable strategy for achieving either economic growth or solidarity with the poor.
Now, the more urgent task is to show that Western European socialism has also failed. Although some aspects of the Western European model originally claimed Christian inspiration and objective, it is now clear that the modern Western European welfare-state is collapsing. And while many modern countries share some of the problems loosely categorized under the "European social model," it is Europe that most desperately needs a genuinely Catholic alternative.
The simplest way to see the failure of the extended welfare state is to look at the demography of Western Europe. The demographic implosion of Europe has both economic and spiritual causes. And the demographic problem illustrates the most basic flaw of the system: It is not sustainable. The modern welfare state or social assistance state can not replenish itself because it has marginalized the family.
The raw demographic facts are these: Europeans are not having enough babies to replace themselves. The fertility rates in the western industrialized countries are well below the replacement rate of 2.1 babies per woman. For the European Union as a whole, the estimated 2005 fertility rate was 1.47 babies per woman. In some countries, the rate is even lower. However, in France, approximately one birth in three is to a Muslim family. Stripped of the Muslim influence, the fertility rate of the native-born or traditionally European French would be 1.2, similar to the rates in Italy and Spain.
The Social Mandate
In addition to the high tax rates necessary to fund the social benefits, the labor regulations impose heavy costs on the young. Most European countries regulate wages and hours, requiring relatively high wages and mandating relatively low working hours. The European social model also requires employers to provide generous benefits such as health care, paid vacations, paid parental leave and the like.
These regulations and mandates have a negative impact on young workers by increasing the employers' cost of hiring workers. The productivity of a skilled, experienced worker can justify this generous compensation package. But a young person, just starting out, may not produce enough to pay for the minimum required wage, much less the entire compensation package including health care, and paid time off. The result is that the young and the unskilled are less employable.
The high unemployment rate contributes to the delaying of marriage and child-bearing. It is estimated that 70 percent of unmarried Italians between the ages of 25 and 29 live with their parents, where they benefit from subsidized housing and where their poor incomes amount to pocket money.
So the European social model provides high wages and excellent benefits -- for the few who have jobs. The system excludes those who are not skilled enough to be economically productive. But everyone begins their lives being not very economically productive. In practice, this means that the young are kept out of the labor market precisely at the time they are most biologically suited to begin forming families. It also means that those who are intrinsically poor, due to disability or low intelligence, are also excluded from participation in the labor market.
The welfare state has also contributed to the marginalization of marriage. Living with parents is not conducive to starting a family. Age at first marriage is an important determinant of family size: A person who gets married at the age of 35, is not going to have as many kids as one who marries at 23.
But this is not the only impact of the social assistance state on fertility and marriage. The life-time assistance of the state displaces the economic function of the family. The elderly don't need adult children to support them in their old age. Women don't need a husband to support them if they do have a child. Husbands become a nuisance, because the government will provide financial benefits without the inevitable difficulties of dealing with a flawed human being as a partner. In this environment, children become consumption goods, an optional life-style appendage to acquire only if one happens to enjoys children.
The social model's attempt to offset declining fertility levels by increasing family allowances has not succeeded and is not likely to succeed in the future. The range of government benefits offered to families is truly staggering. Among the EU countries, parents receive benefits for their children, allowances for a parent who has ceased or reduced employment, single parent allowances, new school year allowances, and housing allowances.
These economic subsidies to child-bearing have failed because they are attempting to replace the father. But economic security offered by taxpayers cannot replace the deeper support that a lifelong marriage can provide a woman and her children. Non-married child-bearing is inherently more risky and more expensive than raising children inside a functioning lifelong married partnership. It is hardly surprising that people choose to have fewer children in a social situation where marriages are unstable.
The social model has failed even in the cultural and social arena. For marriage is now considered optional for childbearing. Couples have a child first, see whether their relationship works, and then, perhaps, get married after the birth of their second child. High levels of social assistance make this casual attitude toward marriage possible.
The understanding and even definition of marriage have been radically challenged. In the late 1990's, some demographers considered "the Dutch model" to be the new model for Europe. The Dutch had combined a liberal family law with a generous welfare state with a surprisingly traditional attitude toward marriage. But no more. Since the agitation for legalizing same-sex unions, the Dutch propensity to marry has fallen, and the percentage of out of wedlock births has increased from 18 percent in 1997 (when the law first began to permit Registered Partnerships) to 31 percent in 2003.
Needless to say, a genuinely Christian social model would not have allowed itself to become so muddled about the meaning of something so basic as marriage. The combination of secularism, which discourages people from seeking meanings deeper than the material, and socialism, which attempts to satisfy the merely material needs, has led to this wide-spread social confusion.
What's more, the presence of a powerful Islamic minority within Europe itself adds to the urgency of solving the demographic problem. Europe is importing workers from the Islamic world, to do the jobs that are intrinsically so low-paying that they cannot be accommodated within the social safety net. These immigrants are not assimilating into European culture. And they are reproducing at a faster rate than the traditional Europeans.
This is the final blow to the European social model. Islam believes in itself in a way that secular Europe does not and cannot. France seemed unable to really confront the rioting Arabs of last fall. The Dutch were nervous about the murder of Theo Van Gogh, but the authorities seemed frightened to confront the fact that the perpetrator was an Islamic extremist who thought himself justified in nearly beheading an "infidel" in the streets.
For at its heart, secularism is a compromise. It is a way of avoiding conflict by avoiding confrontation of the issues that really matter. But no one can truly give their lives, their hearts and minds, to a compromise. Islam has no such reticence. Islam may win because it believes in itself, and the secular European West does not.
This article was adapted from a speech Jennifer Roback Morse gave on January 21 for the Acton Institute Lecture Series Commemorating the 15th Anniversary of Centesimus Annus at the Pontifical North American College in Rome. More on Dr. Morse's speech will be published in a future issue of Religion & Liberty.
Dr. Jennifer Roback Morse is a Senior Fellow in Economics at the Acton Institute for the Study of Religion and Liberty and the author of "Smart Sex: Finding Life-long Love in a Hook-up World".
Read the entire article on the Acton Institute website (new window will open). Reprinted with permission of the Acton Institute.