Tuesday, May 11, 2010

Europe will have to write a new "social contract" as part of rescue package (for Greece, etc)

Howard Schneider has a front page story in the Washington Post on May 11, “A new reality for the old world: Europe must rewrite social contract as price of $1 trillion lifeline”. The online title is kinder and gentler, “Europe rewrites its rule book in creating fund to contain financial crisis”, link here.

The article mentions the effect of unions, lifelong welfare benefits, and particularly an aging population with fewer children in some countries (although France and others have tried to beef up maternity and paternity benefits). We all know that Phillip Longman will laugh at the use of “social contract” in a newspaper headline this way, as he sees it as an obligation towards other generations that every individual shares, regardless of having children (dealing with the need for an incentive to take the risk in having children again). Even in Europe, families may have to take care of their own more again.

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