Coronavirus Could See Americans Embrace European-Style Social Safety Net, Experts Suggest
The Coronavirus crisis could cause Americans to embrace a social safety net similar to those in European nations. Experts told CNBC that the sheer world war-like devastation wrought by the Covid-19 global pandemic could make U.S. citizens campaign for major change.
“The U.S. did not face as much local devastation during World War II as Europe did — and I think at the end of at the end of World War II, most of Europe came together and said, ‘we just went through this incredible trauma, therefore we want more social safety net, we want less risk, we want a more predictable future,” said Morgan House, partner at venture capital firm Collaborative Fund.
“So I think Americans were just more open to saying, ‘no, I want to swing for the fences and take risks, I don’t need a safety net.”
But the effects of Coronavirus were different, Housel said, and could cause Americans to change their views.
“I think maybe this is going to push the United States closer to where Europe has been for the last 60 years in terms of wanting a deeper and more structured social safety net than we currently have right now.”
Economics Professor Pushan Dutt agreed the situation could change what Americans demand from their government.
“Now this tremendous rise in inequality, the depths of despair, the opioid crisis and the final shock of the Covid-19 pandemic, shows off the American problems with their health care sector, with their infrastructure, with their federal political system,” he said.
“This might create a push away from letting markets decide everything more towards having sort of a mix of a welfare state and markets, like the Scandinavians have.”
However, this is far from the consensus among experts. European-style welfare reforms have always been resisted in the U.S. and that opposition has often cut across party lines, with both Republicans and Democrats embracing ‘prosperity’ over welfare.