Europe is the cradle of Western civilisation which has given birth to institutions that have enabled the prosperity of mankind. These institutions are private property, individual’s autonomy and freedom of contract. However, “the European Social Model” as we know it today is far from being even close to these notions. This Model is predicated on a mindset and imagination that certainty of an individual’s personal status in the economy (i.e. guaranteed stable employment and income) is compatible with general economic welfare. Under such thinking, private property is valued less and less, and even slogans of freedom, equality and brotherhood are predominantly turning into demands for labour, stability and well-being. What is this – a hope for universal welfare or loosing one’s pound for a penny?

So desired certainty implies that it has to be ensured by other members of society, while the necessity for self-made efforts of an individual becomes markedly diminished. The situation when a larger portion of society is “ensured” with income by the few engenders problems with individual initiative and endeavour at producing welfare. If from their early days people know they will certainly get a good job, if they know that when they get this job they will be able to retain it until their retirement age, and if they know that somebody else will pay for their pension - economic stagnation, depression, downturn and, eventually, collapse are bound to come. And it is quite off the point that such a state will be gloriously labelled as a “welfare state.” An existing possibility of changes invariably intimidates and impels to self-improvement when creating welfare, that is why the dynamics and flexibility of the market are inevitable attributes of a welfare-producing society.

 

Paradoxically, what keeps Europe still going today is that stability is guaranteed not to every citizen of the so called “welfare state”. In other words, some Europeans create welfare while others utilise it. It is absolutely obvious that justice is highly and reasonably questioned under such conditions. However, consumers of welfare are fierce defenders of their privileges indeed. For example, an army of British employees of government and municipal institutions, who are entitled to receive retirement pensions from their fellow citizens at an earlier age compared to their counterparts in the private sector, have recently poured in the streets striking. The cause of protests was a proposal to eliminate this privilege.

 

Despite economic inefficiency and social injustice, the myth of the so-call European Social Model is still alive. Today citizens of its greatest proponent – France – are just about erecting barrages in its defence. This time it all started when the French authorities passed a law aimed at liberalising employment regulation. This piece of legislation significantly loosened firing procedures of people under 26 and being employed for the first time. The French government is definitely correct saying that this measure will help curbing unemployment among young people. It is clear after all that no employer will hire a person being aware that later he will not be able to terminate the contract with this worker… But the current situation in France raises a more glaring question – why liberalisation was only partial?.. This in itself evokes the feeling of injustice and deception. Bearing in mind that during the previous riots in the country accusations were usually pinned not on the rioters but on citizens who had “failed” to properly integrate them into society, it is no wonder that millions are marching in the streets and tens of thousands are devastating window-cases.

 

Riots have been taking place only in France so far, but demands for pseudo-justice abound in a far bigger number of European countries (including the already mentioned massive revolt of British budgetary workers against the removal of their privileges). It thus poses big danger that the new EU member states, which at present are typically more enthusiastic at introducing the free-market methods and less reliable on government regulation, will follow the same route. For instance, in Slovakia, the most successful EU reformer in recent years, discontented medical workers have already gone out on strike.

 

In Lithuania, which is currently reaping the fruit of the market-based reforms of the past decade, trade unions also attempt at exacting stability for all. In addition to traditional requirements to raise pensions and social assistance benefits and introduce progressive taxation, they propose to fix by law a formula for indexing wages and salaries even in the private sector. The question of who is going to finance increased benefits seems be non-existent. Market relations in the labour market also seem to be unnoticed – as if salaries must climb in line with some magic macroeconomic indicators rather than a particular labour’s demand and supply on the market and value added generated. To put it in other words, trade unions suggest measuring the benefits according to some general formulae rather than individual merits made in creating it.

 

The Lithuanian Government, just as governments in other countries, is set for negotiations. One party (trade unions) will demand for things that don’t belong to them, the other party (the government) will decide on what portion to promise of what, again, does not belong to them either. Everyone is talking about the noble goals of social welfare while the creation of welfare itself and those creating it are usually left outside the focus. Negotiators are generally not the ones to propose that attention should be paid to all people, not just the interest groups, and that wishing to distribute at least the same amount as it is at present, conditions for those creating welfare should at least not be aggravated.