- characteristics
- Subsidiary state in Chile
- Subsidiary public policies
- Differences between subsidiary state and welfare state
- References
The subsidiary state is one that is based on the principle of subsidiarity. In other words, the State must intervene only in those activities that the private sector or the market cannot carry out. In addition, it seeks to decentralize the functions and state powers to make them more efficient and closer to the people.
In the strict sense, subsidiarity has as a fundamental principle that the State is oriented to the search and guarantee of the general interest or the common good. The State only participates temporarily in those economic sectors in which the private sector cannot do so due to their limitations.
Palacio de la Moneda, Santiago de Chile.
Likewise, the State must refrain from intervening in those areas in which individuals or groups of society are sufficient for themselves. The concept of the modern subsidiary state is linked to the neoliberal economic trend of the Chicago School.
Neoliberalism establishes that it is the market together with society who must decide on the distribution of resources. Then, in practice there is a progressive abandonment of the functions and powers of the State: public services (water, electricity, health, education), construction of houses and roads, administration of ports and airports, etc.
characteristics
- The subsidiary State is linked to the neoliberal economic development model of the second half of the 20th century and to the social doctrine of the Church. It appeared in the encyclical Quadragesimo Anno of the year 1931. In this it is established that the State must leave in the hands of the lower social associations “the care and minor business”.
- It involves the outsourcing and / or privatization of some functions of the State and public services. The subsidiary State is based on the principles of decentralization, efficiency and economic freedom in the pursuit of the common good.
- Try to satisfy social needs unsatisfied by the private sector. At the same time, the state must also be concerned about price cartelization or the negative effects of monopoly powers.
- Although the State must intervene as little as possible in the economy, its role is only regulatory to ensure the proper functioning of the market; for example, promote a balanced offer of products and services at fair prices, or generate equity in social justice through the rule of law for compliance with the rules.
- Citizens have full freedom of choice to engage in the activity of their choice, with no other limitations than those established by law. The subsidiary State only assumes that which the members of the community “cannot do well”.
- Decentralization or municipalization of part of the functions of the national State and transfer of powers to the private sector.
- Full adoption of the market economy as the ideal development and production model. The State may only participate in the economy with prior legislative authorization.
- The right of individuals to participate with equal opportunities in the economic activity of their choice is guaranteed. The business community and individuals are the ones who decide what, how and for whom to produce, assuming the risk that this implies.
Subsidiary state in Chile
This model of State was adopted in Chile in the Constitution of 1980 where the principle of subsidiarity was established.
After its approval, somehow it broke with the social doctrine of the Church that defended the welfare state that until then worked.
The Chilean subsidiary state assumes doctrinally the guarantee of economic security (the fulfillment of contracts), while at the same time being concerned with conquering new markets and maintaining current ones. It seeks efficiency and economic freedom for suppliers and consumers.
Between 1920 and 1970, Chile was the Latin American country that allocated the largest budget of its domestic product to social programs to overcome poverty.
During the dictatorship, a significant reduction in poverty was also achieved with the high economic growth achieved; his social policy focused on the poorest classes.
It is believed that the country could once again be assuming a more benefactor role, due to growing social conflict and pressure from social movements that require the State to assume greater responsibilities, especially in terms of market regulation.
Subsidiary public policies
The orientation of the public policies of the Chilean subsidiary State was clearly outlined in three articles of the current Constitution. Article 22 establishes the principle of equity and economic non-discrimination of any sector, activity or geographical area.
Article 21 establishes that the State may participate in economic activity in a business role "only if a qualified quorum law authorizes it," while Article 20 adds that all taxes "will enter the nation's patrimony and may not be affections to a specific destination ”.
The Chilean neoliberal economic model began with the process of destatization of public companies and the sale of these assets to private entrepreneurs.
Then it was completed with the decentralization and incorporation of the municipalities to the provision of basic services (health, education, housing, water, electricity and even subsidies).
The scope of action of the subsidiary State was subordinated to serving the people, guaranteeing the protection of the security of the nation, the protection of citizens and the family.
Differences between subsidiary state and welfare state
- The welfare state emerged in almost the entire world after World War II. It was a sort of social pact to distribute the national wealth more equitably and avoid social unrest. In the Chilean case, the subsidiary state began in the 1970s with the Pinochet dictatorship; it was consolidated with the approval of the Constitution of 1980.
- The welfare state seeks full employment together with the job markets in times of rising unemployment. Instead, the subsidiary leaves the employment and price situation in the hands of market forces.
- The subsidiary State does not guarantee social protection for the satisfaction of the basic needs of employment, food and public services. Nor does it focus on labor laws to protect workers to the detriment of employers in terms of remuneration, working hours, the right to strike, retirement, etc.
- The subsidiary state does not raise taxes on economic sectors and the population to subsidize the immense social spending generated by the welfare state. The State does not assume the role of responsible for the welfare of its citizens nor does it guarantee social security. Its functions are limited to guaranteeing national and personal security.
- The subsidiary state does not have a collectivist / statist ideological orientation with a tendency towards egalitarianism and uniformity of social welfare. Instead, it guarantees equal opportunities to all by offering freedom of choice. Thus, everyone is dedicated to the activity of their choice and runs the inherent risk.
- Unlike in the welfare state, in the subsidiary state education is the responsibility of the families, not the state.
References
- Subsidiary state: economy and society. Retrieved May 18, 2018 from politicayeconomia.cl
- Social policies, poverty and the role of the State: or the absent father syndrome. Consulted of ubiobio.cl
- Welfare State versus Neoliberal State: depoliticizing politics. Consulted of elquintopoder.cl
- Subsidiarity. Consulted of en.wikipedia.org
- From a subsidiary state to a social state of law. Consulted of constituent citizens.wordpress.com
- The Genealogy of Jaime Guzmán's Subsidiary State. Consulted from link.springer.com