ESSAYS AND STUDIES
CONTRIBUTION OF LIBERALISM TO THE UNDERSTANDING OF THE STATE – CRITICISM OF WELFARE STATE
Welfare state was one of the most important political and economic projects of the twentieth century. Its development has contributed to the spread of communism in the east and the manifestation of certain weaknesses of the market economy model in the west. After the great economic crisis of the 1930s, which broke out in the United States and expanded globally, political and economic thinkers began to search for a model that would be able to correct the weakness of the market. This led to the emergence of Keynes’ theory, which in several decades later, in its various modalities, managed to survive in practice. However, although with its strong social component this model has gained millions of people around the world, over time, it began to show his weaknesses. The state of well-being in time demanded a growing degree of state influence in economic flows, which has suppressed competition, led to inefficiency, a brazen bureaucratic apparatus and a recession. Already at the end of the 1970s, the Western world was spattered by a wave of neoliberalism – that is, libertarianism. Neoliberal waves in the Western world had two main directions – reganism and tatcherism. Ronald Regan and Margaret Thatcher were the first Western leaders to dare to embark on a decommissioning of the state of well-being. They unquestionably accepted the proposals of neo-liberal thinkers, seeing the cutting of state expenditures a way to bring the economy out of the recession. Thanks to the criticism of the welfare state at the academic level by major economic thinkers – like Hayek, Nozick, Friedman and others, and their promotion of the liberal market, the Western world is gradually turning to the decay of the state of welfare state. After the collapse of the Eastern bloc, and the collapse of socialist and communist projects, the liberal model of the market economy imposed itself as a winner in the ideological and practical sphere.