Social Welfare in Europe

The Euro debt crisis and calls for fiscal austerity are putting a harsh new light on Europe's gold-plated welfare and pension programs. According to some economists, Europeans pay for their generous welfare programs — such as national health insurance and universal preschool — with more sluggish economies and higher unemployment than in the United States, which has among the industrialized world's least generous welfare safety nets. But in recent years, Scandinavian countries, the most generous with subsidized child care and paid parental leave, have grown at least as fast as the free-market United States. And, contrary to popular opinion, workers there have a better chance than Americans of climbing further up the economic ladder than their parents. Now Greece, Spain, France and Portugal have all proposed welfare austerity measures — mainly delaying early retirement ages and freezing pensions — not cutting core programs like free child care or unemployment safety nets. Cutbacks in pensions have already spurred angry street protests, but most experts agree Europe has little choice as it faces a demographic time bomb of aging societies supported by a diminishing number of workers.