Europe Can Have Both A Welfare State & A Warfare State

I keep reading about how if Europe increases military spending they’ll have to cut welfare spending.

Let’s look at a little history: back around 1960 West Germany spent 4% of GDP on their military. They were happy to do so. They also had a very generous welfare state. So did most of Western Europe and they were spending a lot on their militaries.

“But Ian,” you exclaim, “that’s not possible. If you have a warfare state, you can’t have a welfare state!”

Here’s the rule. Pick any two of the following three:

1. A Welfare State.
2. A Warfare State.
3. Low Taxes on the rich and corporations.

All it takes to have both a warfare and welfare state is 90% top marginal tax rates and various other taxes and laws designed to force corporations and the rich to invest in actual production and not in rentierism. Strangely, when Europe and the US had those tax rates, they had the best economies in their entire history.

Wonder why none of the pundits suggest going back to the successful warfare/welfare policies of the 50s and 60s?

I guess it’s a mystery.

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