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Who the welfare state protects shapes a country’s financial openness

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Re: Who the welfare state protects shapes a country’s financial openness

#21

Post by johnvanommen »

> “The pattern invites us to read welfare as macroprudential policy, part of the toolkit that keeps financial openness politically survivable. Where redistribution runs vertically and broadly, the welfare state itself absorbs the shocks of global finance. Where it runs horizontally, protecting established insiders while the rest carry the risk, governments buy stability at the financial border instead. Capital controls work as a cheap, imperfect substitute for redistribution. They calm an exposed society without asking anyone at the top to pay.”

Their analysis will yield false conclusions because they’re completely ignoring a number of variables.

For instance, the USSR had capital controls for financial and political reasons. The article assumes that politics plays no role, only finance.

Wall Street influences US financial policy, but so does politics.

The laziness of this research is shocking, so I looked up the author. He’s an author for the Communist blog “Jacobin.”

Why is this on Hacker News?

This paper is flimsy propaganda.

https://jacobin.com/author/martino-comelli

Re: Who the welfare state protects shapes a country’s financial openness

#22

Post by cwbuilds »

autoexec wrote: post #17
3748949494 wrote: post #8

Earlier quoted context omitted.

Is that why wages in the US are double those in europe or more

It's because the most massive costs an American has like healthcare, child care, and higher education are free or vastly less expensive in Europe. Americans spend all their time at work for a very impressive number on their paystub while they're still one accident or illness away from homelessness or bankruptcy. Europeans get higher quality of life/happiness scores and spend far less time slaving away for their boss.…

Not sure we do have better quality of life in Europe. We may have in the 2000s, but we're in decline relative to the US. Even if you take things like healthcare into account:

US average disposable income is $51,000, while it's $32,000 in the UK (with higher rents in the UK than the US).

Re: Who the welfare state protects shapes a country’s financial openness

#23

Post by AlotOfReading »

3748949494 wrote: post #8
ck2 wrote: post #5

in the US it protects the corporations so they don't have to pay a living wage * https://www.washingtonpost.com/business/2026/07/22/amazon-gi...

Is that why wages in the US are double those in europe or more

The median salary in the US is $43k for the latest year I see data (2023). Median salary in the Netherlands and Germany was €44-48k or ~$50-55k.

We might make half as much (rather less for me actually) because of our specific industry, but that's not generally true.

Re: Who the welfare state protects shapes a country’s financial openness

#24

Post by SubmarineClub »

mono442 wrote: post #11
3748949494 wrote: post #9

Earlier quoted context omitted.

surely buying bonds will save you when you are running 8% yearly deficits to buy votes with welfare payments

There's no natural law saying that budgets have to be balanced. Most countries run constant deficits.

Governments being able to borrow money (to run that deficit) relies on people believing that they will be paid back. The more the debt grows, the less likely people are to believe they’ll get paid back.

The other option is endlessly printing money, which causes hyperinflation and you get an Argentina/Turkey/Weimar Republic situation.

Re: Who the welfare state protects shapes a country’s financial openness

#25

Post by ifwinterco »

amazingamazing wrote: post #7
ck2 wrote: post #5

in the US it protects the corporations so they don't have to pay a living wage * https://www.washingtonpost.com/business/2026/07/22/amazon-gi...

Given that you cannot force someone to hire anyone at a given wage what is the solution? At best all you can say is that if you decide to hire, it cannot be lower than some minimum, but often this results in no job at all.

This is what happened in the UK but not immediately, it’s only in the current government where the minimum wage (especially for young people) got hiked massively in the context of a weak overall economy that the effect on job creation became obvious.

Now it’s quite bad though, a whole generation of 16-20 year olds entering the job market and there’s just no jobs because you can hire a 30 year old for the same money

Re: Who the welfare state protects shapes a country’s financial openness

#26

Post by johnvanommen »

3748949494 wrote: post #9
mono442 wrote: post #4

Earlier quoted context omitted.

The crisis was largely artificially engineered because Germans believed that Southern Europeans were "lazy" and needed to be made an example of. The ECB could have brought government bond yields down from the beginning and most of the problems could have been avoided.

surely buying bonds will save you when you are running 8% yearly deficits to buy votes with welfare payments

The author writes for Jacobin.

Of course it’s promoting Communism.

Re: Who the welfare state protects shapes a country’s financial openness

#27

Post by SubmarineClub »

autoexec wrote: post #20
amazingamazing wrote: post #7

Earlier quoted context omitted.

Given that you cannot force someone to hire anyone at a given wage what is the solution? At best all you can say is that if you decide to hire, it cannot be lower than some minimum, but often this results in no job at all.

> At best all you can say is that if you decide to hire, it cannot be lower than some minimum That's pretty reasonable. Nobody should be working 40 hours a week at a job and not make enough to support themselves. Any company who can't afford to pay their employees at least that much is a failure who deserves to be out of business.

> Nobody should be working 40 hours a week at a job and not make enough to support themselves.

So it’s better that they don’t get hired at all and live entirely off support of the (forced) largesse of the tax payer?

As one of those tax payers I’d much rather they work and earn at least something.

Re: Who the welfare state protects shapes a country’s financial openness

#28

Post by johnvanommen »

amazingamazing wrote: post #7
ck2 wrote: post #5

in the US it protects the corporations so they don't have to pay a living wage * https://www.washingtonpost.com/business/2026/07/22/amazon-gi...

Given that you cannot force someone to hire anyone at a given wage what is the solution? At best all you can say is that if you decide to hire, it cannot be lower than some minimum, but often this results in no job at all.

> Given that you cannot force someone to hire anyone at a given wage what is the solution?

The author writes for Jacobin, which promotes a failed ideology where you CAN force people to “hire anyone at a given wage.”

It’s an advertisement for a failed ideology.

Re: Who the welfare state protects shapes a country’s financial openness

#29

Post by autoexec »

SubmarineClub wrote: post #27
autoexec wrote: post #20

Earlier quoted context omitted.

> At best all you can say is that if you decide to hire, it cannot be lower than some minimum That's pretty reasonable. Nobody should be working 40 hours a week at a job and not make enough to support themselves. Any company who can't afford to pay their employees at least that much is a failure who deserves to be out of business.

> Nobody should be working 40 hours a week at a job and not make enough to support themselves. So it’s better that they don’t get hired at all and live entirely off support of the (forced) largesse of the tax payer? As one of those tax payers I’d much rather they work and earn at least something.

That's a false dichotomy. Those workers can get hired by a competent business who can afford to pay a living wage and doesn't need the government to subsidize their labor expenses.

Re: Who the welfare state protects shapes a country’s financial openness

#30

Post by WarmWash »

amazingamazing wrote: post #7
ck2 wrote: post #5

in the US it protects the corporations so they don't have to pay a living wage * https://www.washingtonpost.com/business/2026/07/22/amazon-gi...

Given that you cannot force someone to hire anyone at a given wage what is the solution? At best all you can say is that if you decide to hire, it cannot be lower than some minimum, but often this results in no job at all.

The actual problem in the US is housing costs, but most people are around social media knowledge level in this area, and just blame the first thing in front of them. Raising wages will do nothing to ease housing costs, which eat the largest chunk of everyone's pay.
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