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"Volume 6 of The Collected Works of Arthur Seldon examines the failure of state-supported welfare programs to benefit the people most in need of help. The eight articles and one book in this volume encompass almost forty years of criticism of the welfare state.

Seldon argues that the welfare state cannot, in the long run, solve the problem of poverty. It is driven by misguided egalitarian views which make it universalist, providing benefits for the middle classes as well as the poor. Because it finances welfare through taxation, it damages incentives to work. Moreover it diminishes motivations to save and to provide for one’s family as the state appears to take over such responsibilities.

Once “free” welfare services are begun they are very difficult to stop. But, says Seldon, permanent state welfare is unnecessary: as people’s incomes rise, most are capable of providing for themselves and their families. In the end, people will revolt against inferior state services and the state will have to retreat. "

“This short book was drafted in early December and revised by early January. If I had had more time I should have dealt more fully with the arguments shrewdly marshalled and deployed by Mr. Richard Crossman, with academic acumen but with variations according to his audiences during 1969, for the massive inflation of state pensions he proposes in the National Superannuation and Social Insurance Bill, 1969. If the die is not yet cast, if there is still time to reflect, a short reminder in non-technical language to people in Parliament and at home that the world in which we live makes inflated, compulsory and universal state pensions unnecessary and undesirable might do more good than a longer book that came later or too late. This Bill embodies the thinking of a small number of people—mostly sociologists
and politicians—speaking for themselves, not even for the Labour Party, possibly not for the Government, and certainly not reflecting the aspirations of the rising wage-earner.
Their intentions may vary from the praiseworthy but fallacious—the desire to avoid “two nations” in old age and the fall in living standards in passing from earnings to state pension on retirement; through the expedient but question-begging—the raising of revenue for the badly-battered National Insurance Fund and for current retirement pensioners; to the calculating but problematic—the desire for political popularity and re-election in 1970–71. But they stare blindly at the growing dichotomy between the increasingly satisfied demands of the emerging wage-earner as a consumer of commercial goods and his frustration as a “beneficiary” of state welfare. When confronted with chronic deficiency in state pensions, education, medical care, they mindlessly mouth “More money! higher taxes!” and, on a lower moral plane, “but let’s call it social insurance.”

Arthur Seldon

Dr Arthur Seldon CBE (1916-2005) was joint founder president, with Ralph Harris, of the Institute of Economic Affairs, where he directed academic affairs for 30 years.

He studied at the London School of Economics where Arnold Plant and Lionel Robbins deepened his interest in classical liberalism and Friedrich Hayek introduced him to Austrian Economics. He received an honorary degree in 1999 from the University of Buckingham.

• Seldon was Vice president of the Mont Pelerin Society (MPS), whose past presidents include von Hayek and Milton Friedman.

  For over thirty years from the late 1950s Arthur Seldon was the Editorial Director of the London-based Institute for Economic Affairs, where his publishing program was one of the principal influences on governments all around the world, persuading them to liberalize their economies.

• Arthur Seldon was a prophet of what came to be called Thatcherism. The Thatcherite revolution of the 1970s and 1980s had many roots, but one was certainly a sea change in the intellectual climate of the times, and Seldon played a huge role in that sea change.