On the social welfare economy

After 1980, our country entered a process with undefined principles and rules, which was called a free market economy. Although it was claimed that the class known as the "middle class"—consisting of workers, farmers, and civil servants—would be developed through this free market economy, we saw after a while that the middle class had been dismantled. In our country, the free market economy has further deepened the gap between classes. 

The implementation of the free market economy did not stop there; it led to major revisions in the moral and organizational understanding of democratic mass organizations, unions, and political parties. The transition from collectivism to individualism was so rapid that individualism manifested itself in every field and became a way of life; this result brought with it an indifference toward social and national problems. This situation has revealed that the free market economy is nothing more than a ruthless form of capitalism.

So, what is the alternative to this? In our view, the alternative is a social welfare economy. At the forefront of the principles of a social welfare economy are "freedom, justice, welfare, peace, and security." The market economy has disrupted the order of justice, the order of welfare, peace, and security. The economic policy of a social welfare economy aims to reconcile the principle of "distribution according to work and need." These principles, which we count as the principles of a social welfare economy, are the main principles in shaping social life and hold a very important position.

We can group the macroeconomic goals of a social welfare economy under four headings.

- Stability of the general price level (monetary stability),

- High level of employment (full employment),

- Balance of payments,

- Continuous growth rate and development.

As is known, an increase in the general price level brings inflation to the agenda, while a decrease brings deflation. Inflation leads to changes in the distribution of income and wealth. As a result, retirees, the unemployed, workers, and civil servants suffer from inflation. Trust in the national currency decreases. This jeopardizes an economy sensitive to the division of labor. Therefore, the goal of a social welfare economy is to maintain continuous price stability.

The employment level, which is interpreted as the full utilization of the workforce in an economy, targets a high level of employment in a social welfare economy. This is because the economic and social consequences of low employment—that is, unemployment—are significant. A low level of employment leads to a decrease in the level of welfare, causes the decision-making and behavioral spheres of economic units to narrow, sharpens social contradictions in society, and therefore reduces the chances for social peace and, simultaneously, political peace.

In a social welfare economy, the goal of the balance of payments is equilibrium. By equilibrium, we mean that the amount of foreign currency entering and leaving the country is at an equal level.

Economic growth in a social welfare economy refers to the increase in real gross social product over a certain period. In short, this is called an increase in living standards, or "welfare growth."

In addition to these macroeconomic goals we have listed, goals such as social security and social development are direct extensions of the social welfare economy concept. In a social welfare economy, the goal of social justice is identified with the socially fair distribution of income and wealth in practice.

In a social welfare economy, preventing inflation and unemployment, achieving fair income distribution, and ensuring development are the prerequisites for realizing social security and justice.

Prof. Dr. Duran BÜLBÜL