What kind of Europe do we want?

Not surprisingly, the EU courts have decided that national law may determine who gets welfare, rather than EU law, at least when it comes to foreign EU nationals. A sad, yet reasonable decision.

The case there were discussing was about a Romanian woman with a son who was refused benefits by the Germany bureaucracy. Authorities claimed that she did not try to find work – something that a lot of the public discussion has centered around. “Welfare tourism” has been the term that framed this case.

Apparently, we ain’t Europeans, we are “tourists” now

However, this is not the main issue here. Should people get benefits, even though they are not “properly” looking for work? Or, as some german newspapers have asked: Should someone gain benefits from a system they have not contributed to before?

As interesting as these questions may be, they are far too broad to covers this. These questions come up when we talk about national welfare programmes, and unemployed will be compared to children with regards to how much they contribute to these welfare systems. When it comes to EU foreign nationals, we are dealing with a different issue: How should we handle national welfare systems, when workers, money and products know no borders within part of the EU?

These systems maintain borders that no longer apply to workers. The german retiree, who gets money from the german state, yet lives in spain, has been a common theme a couple years ago. And people felt like something was weird – or wrong – about that: Someone gains funds from a state, to live somewhere else. But what about someone who has contributed to one state, but wants to gain benefits from another state?

If someone has worked in Romania for 20 years, and now, with 40, wants to move to France, because of family issues, they would not get anything. Their tax money would effectively be lost – that is, if you consider taxes as “contributions” to a system that will later “take care” of you. That is another way of saying “stay where you belong” – as opposed to the idea of Schengen, that Europeans may live and work wherever they want.

The EU courts are right, but that’s bad for Europe-lovers

This is an issue that I can only bring up to raise some concerns and counter some arguments. It is not an issue that anyone can provide a better answer to than the one the EU courts have provided. There is a very simple reason for that: Welfare systems differ greatly among European states.

Some states, and I am certainly not talking about Germany, but rather Sweden, have very generous benefits. They invest heavily in their population. Good education, even for socio-economically challenged children, support for the poor and so on enable them to “mobilize” people. By that I mean that they gain a lot from their population – healthy, well educated people make up a better working force than malnourished, illiterate people.

A rational state would now want to reap the benefits of these investments. But what if the people move abroad after receiving such care, to avoid high taxes? Free borders allow that. An EU immigrant, who wants to live in a country for 3 years, will not “pay off” as an investment. The more common line of argument: Someone might move to a country to reap benefits. This is a line of argument that I do not find very convincing; few people move for monetary reasons alone, research usually assumes a bunch of pull and push factor that, combined, lead to immigration. But the general idea is there: Some countries will invest heavily in people, but with free borders, they will not necessarily be the countries that will benefit from these people.

Game theory: Being a jerk pays off

This leads to a dilemma: The logical reaction would be to provide less benefits than the neighbour states, but provide good income for well educated, young professionals. Get the promising people to your country, and leave the generous countries with the rest. There, I have summarised the Tory party platform for you!

The only way to circumvent that is, well, to allow states to exclude foreign EU nationals from benefits. That way, there is less on an incentive for states to reduce benefits in the first place – yes, I am saying that socialist policies will not work without this exclusion, at least not right now.

Does that mean this is a good thing? Certainly not. Globalization and Europeanization of national economies mean that european states are getting more entangled. Which means that it will be harder to have any kind of economic policy on a national level alone – raising benefits does not mean that your population will spend the money at home. If Europe is supposed to grow together, it need to also coordinate its welfare systems – which would mean abolishing rules that allow the recent EU courts decision (if you want Europe to implode, well, then nothing has changed for you).

But yeah, like that is going to happen.


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