Social Security in the BRIC Countries

Introduction

In this article, the authors explore what would be the common, determining factors and challenges for the future of social security in the four emerging economic powers—Brazil, Russia, India and China—commonly referred to as the BRIC countries

This is not a discussion of social security as it stands today in the BRIC countries or what the plans are at both governmental and nongovernmental levels. That would take far too long. What we attempt to do here is try to understand where the BRIC countries stand as far as social security is concerned. In a way we have undertaken a quo vadis—“where are you going?”—assessment of social security in the BRIC countries.

Previously we presented the results of interviews we had with the social security administration heads in 15 Western European Countries in a publication the titled “Social Security Quo Vadis.” ¹ In that article, we discussed the main determining factors for the future evolution of social security in Western Europe and, even more important, were able to develop some “important messages” for the future of social security.

There were 12 main messages for those interested in the future of social security and concerned the following:

Attempting to find communalities in challenges and perspectives for the BRIC countries was not easy. Moreover, this assessment differs in that it was impractical to interview the heads of social security agencies. For this study, we relied on the literature and our knowledge of other social security arrangements. The exercise required evaluation, and thus choices had to be made to come up with a clear and understandable result. The 20 challenges enumerated hereafter are often the result of such a choice.

We believe it will be important for organizations that plan to operate in one or more of these countries to have a background awareness of the issues that influence the planning for social security and are likely to surface for them as employers. If social security in these countries follows the basic pattern in North America and Europe, employers will play a role in building enhanced social security systems.

At the conclusion of our research on the social security literature in Brazil, the Russian Federation, India and the People’s Republic of China, we selected the following 20 items as the main challenges confronting these countries; issues relevant to only one BRIC country were disregarded.

The main challenges for the future of social security in the BRIC countries are the following:

1. The Lack of a Social Security Paradigm or Model

To see whether social security is functioning well, it is important to establish the goals or purpose pursued by social security.

We define social security as the body of financial and other support arrangements shaping the solidarity with people confronted by lost or diminished income at the end of their working lives or who incur unexpected costs. In these approaches, we see two intrinsically interconnected goals of social security: (a) combating possible poverty and social exclusion and (b) providing income security in the cases of some social risks.

It seems unclear what is intended by the various social security arrangements in the BRIC countries. This might be related to a fundamental shift in the societal paradigm (Russia and China) or simply to the fact that the concept of social security was developed in a very different environment (India). It will be important for the future of social security in the BRIC countries that they reflect on the meaning of social security in their societies. A clear vision of social security and its goals and an understanding of the system are necessary to optimally involve the people.

Moreover, in some BRIC countries, social insurance appears to be less a tool of solidarity and redistribution and more an instrument to provide privileges or benefit certain (better-off categories of the) population. This calls, of course, for some prudence in transposing the logical framework for social security in the industrialized world onto the BRIC countries.

2. The Coverage of All the (Working) Population

Brazil and Russia, with their 198 million and 144 million inhabitants, respectively, have populations well below that of the European Union with its 501 million inhabitants. India and China, however, each count more than double the inhabitants: India has 1.2 billion and China 1.4 billion. If we examine how many people work in the so-called formal sector of these BRIC countries we, come to the following figures: ²

In China, in the period 1996 to 2001, the ratio between the employment number in informal sectors and work units would have increased from 1:4 to greater than 1:2.

Social security in the BRIC countries without any doubt suffers from the fact that many citizens are left out of the social security arrangements. In fact, having social insurance coverage seems to be a privilege of a restricted number of persons, who often in other respects would be labeled as the better-off, namely, those persons working for the government (both central and local) or for a larger enterprise where they enjoy better social security coverage.

The remainder of the workforce is often labeled as the “informal sector,” a concept used by international organizations such as the International Labour Organization. This vague category captures a wide variety of working people, including salaried workers not covered by a labor contract, temporary workers, workers in the submerged economy and those who are self-employed. We think it would be better not to pile up all these different kinds of workers under a single category, “informal sector workers” but to differentiate among them. The lack of decent social security coverage of many of those working in the informal sector remains a serious challenge to all BRIC countries.

Special attention in the BRIC countries goes to those living in rural areas and/or active in small farming. Often a basic protection is provided to them at a lower cost than to workers of the formal sector in larger enterprises.

Some social security arrangements, often sponsored by government, in the BRIC countries try to overcome the lack of coverage of large sections of the population through voluntary insurances open to those not mandatorily covered. It remains to be seen whether such an approach has no perverse redistributive effects: in other words, whether state support for voluntary insurance does not benefit in the first place those who are competitively already better-off, as they can afford the payment of voluntary contributions.

As to the access to health care, universal coverage of the population appears to be the ambition of the BRIC countries. Brazil and Russia have already implemented it, although the medical treatment a resident (Brazil) or a citizen (Russia) actually receives will in many regions be very basic and/or of poor quality. China and India are working on a continuous extension of its health care insurance programs to people not yet covered, though their reform plans reveal that the complete coverage of the population is still in the distant future. More on this topic under the heading “Access to a Qualitative Health Care.”

Some special groups of vulnerable people (e.g., the family members of detainees and people escaping from slavery-like situations in Brazil or for the outcasts in India) have been singled out in some BRIC countries to get preferred attention.

3. Demographic Reality

Demography plays an important role in the construction of a good social security system (see Table 1). When the portion of old and economically inactive people in a society is large, it puts a heavy burden on the financing of social security benefits.

OPEN IN VIEWER

Table 1.

Comparative Demographic Facts

	European Union	Brazil	Russia	India	China
Population (million)	501	198	144	1,222	1,373
Life expectancy general, man and women (at age 1, years)	78.8	73.0	66.3	66.1	73.7
Population younger than 20 years, million (%)	107.2 (21.4)	66.7 (33.6)	29.2 (20.2)	495.4 (40.5)	375. 5 (27.3)
Population older than 60 years, million (%)	116.7 (23.3)	22.7 (11.5)	29.5 (20.4)	99.7. (8.2)	185.8 (13.5)

Note. Figures for the European Union are drawn from Eurostat; figures for the BRIC countries are drawn from United Nations Population Division. (2010). World population prospects: The 2008 revision (http://esa.un.org/unpd/wpp/unpp/panel_indicators.htm).

The aging of the population is a problem not only in Western countries but also in the BRIC countries. The one-child policy in China, the deterioration of life expectancy combined with low fertility rates in Russia and the steady increase of life expectancy and decline of fecundity in Brazil make the provision of social security for the elderly and those who will become the elderly in the near future an extremely important challenge. The countries appear to be well aware of this demographic challenge, as illustrated by the initial reconsiderations of the one-child policy in China or the Russian plans to increase its population.

4. Changed Family Patterns

Also, in the BRIC countries, traditional family patterns tend to be weakened as a consequence of

This change of traditional family patterns provides a challenge to the social security in that the family is no longer providing protection against social risks, such as taking care of the offspring, caring for the old family members or taking care of incapacitated family members in material or even financial terms. All these social risks are increasingly evident, making it important for social security to take these possibilities into consideration.

Adapting to new family models does not only mean, however, the possibility of addressing the newly emerging social risks. The new societal reality will be a challenge for the already recognized social risks and the existing social security arrangements also. This relates, for instance, to higher living costs for one-person households in comparison with multiple-individual households, which accordingly necessitates higher social security benefits. It is noteworthy that nonmarital cohabitation and gay partnerships are recognized by some social security arrangements in Brazil.

5. The Interaction Between Economic Development and Social Security

The development of social security is intimately linked to the economic development of a country. While the relationship between economic development and social security may be strong, the linkage is neither necessary nor automatic. A country may develop economically in a very positive way and decide to do so without attaching an equivalent attention to the development of the social security of its population.

None of the four BRIC countries is taking that option, however. Each is committed to making the entire nation benefit from the economic development and also motivated to develop, where economically feasible, the social protection of the workers and to combat extreme poverty. At the same time, the BRIC countries are very much aware that their economic development should not be hindered by establishing an overly ambitious social security system. The key question is of course where the positive linkage between social and economic development ends and the social hindrance of economic development starts.

In none of the BRIC countries is the development of social security perceived as positively related to their economic development. In the West, there is support for the idea that social security through increasing the purchasing power of people contributes to internal consumption and thus contributes to economic development. In the BRIC countries, the economic development is still to a large extent export oriented. The development of an internal market and increased consumption in the BRIC countries may, however, benefit in the future from the development of social security.

6. The Diversity of Economic and Social Realities Within One Country

A challenge common to all four BRIC countries is connected closely to their vast territory. The various regions and diverse rural and urban areas present very different economic and societal circumstances. The BRIC countries respond to the challenge of geography and large populations by a layered governmental structure, which is reflected in the way social security is structured. The responsible agency at the central/federal level focuses primarily on setting targets and defining principles, while the states and sometimes the municipalities work out these principles in accordance with local realities. This has led to rather important divergences in social security between the rural areas and urban areas, which exist, for example, across China.

The disparities, in terms of both social–economic reality and social security protection, constitute an enormous challenge to all BRIC countries, in terms of the following:

The BRIC countries have to a larger extent accepted the differences in wealth between their regions and have to a lesser extent than, for example, Western Europe set up mechanisms to correct these disparities. At this point, there is no apparent intent to provide consistent benefits across the country.

The picture presented by the BRIC countries is sometimes clouded by the fact that pilots or new ideas are set up in some areas of the countries but are not found in other regions, and nor are they part of an overall national plan. We might ask ourselves whether such pilots effectively serve national goals.

Concerning internal mobility, the diversity of social security protection in particular within China and India leads to questions of social security coordination. Those questions are in turn linked to the question whether BRIC countries should consider internal migration as an asset or as something to avoid, that is, avoiding an influx of new workers and residents to urban areas or to wealthier regions.

7. The Lack of Transparency of the Social Security System

The very fragmented coverage of some working groups, and the social security options provided on a regional or municipal level, makes it very difficult to get an overall picture of the social security in the BRIC countries. In addition, the local pilots and trials confuse the picture.

The question is whether to a certain extent this lack of transparency might be intentional. Having huge differences in the social security protection among different professional groups and different regions or municipalities could raise questions of justice and fairness. It cannot be excluded that the government wants to avoid these questions. The huge social security challenges in the BRIC countries, against the background of rapid economic growth, might only allow for a gradual buildup and extension of social security.

8. Poverty Alleviation and Basic Needs

All four BRIC countries acknowledge the high poverty rate in their country (see Table 2) and try mainly through social assistance programs and welfare services to address extreme poverty issues. The economic development of these countries in the past decade makes it indeed possible to alleviate poverty through such programs. Yet the challenge remains enormous.

OPEN IN VIEWER

Table 2.

Comparative Income Levels

	European Union	Brazil	Russia	India	China
Average annual income per person (US$)	32,900	11,239	15,836	3,339	7,518
Number of people living under the absolute poverty line of less than US$2 per day (%)		18.3	<2	75.6	36.3

Note. Figures are drawn from the CIA (Central Intelligence Agency) World Factbook and the IMF’s World Economic Outlook Database, as well as from the United Nations Population Division Human Development indices.

Poverty alleviation and addressing basic needs will be a challenge for social security not only because of the financial resources needed but also because of the unequal distribution of poverty within the countries. Poverty in the BRIC countries affects, in particular, rural areas dominated by agricultural households, the population of economically less developed provinces or certain social groups, such as indigenous people in Brazil and the scheduled castes in India. The challenge will be to convince the better-off regions or parts of the populations to demonstrate solidarity and contribute to the fight against poverty.

9. The Lack of Solidarity and Interaction Between Social Assistance and Social Insurance

In each country’s literature there seems to be a division of views between those experts and policy makers who adhere to the strict seperation of social insurance and social assistance and those convinced of the need to unify both under the umbrella of the more modern concept of social security. It is striking to see that in the BRIC countries, the division between social insurance and social assistance arrangements remains rather strict, at least in the sense that very few elements of solidarity or redistribution between various groups are included in the social insurances, whereas the social assistance arrangements focus clearly on the extremes of poverty. It might be worth examining whether the development of social insurances—which are often limited to the already better-off groups of workers—should not be more systematically extended to those currently excluded from the scope of these insurances, and to the weakest groups first. This does not seem in line with the development of social insurance and social assistance in the BRIC countries.

Social insurances are rather inward looking and finance themselves (often with public support), whereas the general budget covers the expenses of the social assistance arrangements. At first sight, social insurance arrangements for rural workers or voluntary social insurances, which are heavily supported by the public budget, seem to be in contradiction with the above; but here again we see no attempt to link these rural or voluntary schemes, which most often address the so-called informal sector, with the social insurances of the formal sector.

10. The Weak Interconnection Between Social Security Actors

The complexity of the social security structure in the BRIC countries results in a large number of active social security administrations, which work in an isolated way with little interaction. It will be a challenge in the future to better coordinate the work of the different social security administrations, starting with better exchange of information. Apart from better coordination, a general simplification of the administrative structure of social security should be considered. The initial plans to simplify the administrative structure were, however, observed in our investigations of the literature in each BRIC country.

The weak interconnection between social security actors negatively affects an added problem in the BRIC countries: social security fraud. Here we are talking not only about contribution fraud typically by employers or benefit fraud by beneficiaries but also about fraud by social security agencies. For a more effective fight against social security fraud, better coordination and more effective supervision of social security administrations seem necessary.

A side effect of the weak interconnection between the social security administrations in the BRIC countries is that it is rather difficult to establish comparative standards as to their efficiency and effectiveness. This makes it difficult to assess whether the social security administrators deliver good value for money or, in other words, whether their administrative cost can be considered reasonable.

11. The Role of Private Actors in Social Security

In all BRIC countries, the private sector has been given an important or reduced role to play in social security.

Private or semiprivate service providers have been given a prominent role in the health care sector of the BRIC countries. Private sector providers are also involved in the field of old age security as part of the government’s social security considerations.

Private actors fulfill not only a role in the formal social security system but also, maybe even more important, a role in the informal protection in some of the BRIC countries. In India, for instance, self-help groups, that is, usually unregistered associations of poorer workers in the informal sector, provide for protection against the occurrence of social risks among their members.

It is important to note that the growing impact of private entrepreneurship and the private market in some BRIC countries is not always fully absorbed by social security systems. In earlier times, in countries like Russia and China, when companies were in state hands and with trade union involvement, one could assume that the social security contribution duties were better managed than today with the myriad private companies of diverging stability.

12. Pensions and Other Income Replacement Arrangements

Pension arrangements take a very prominent place in the social security constructions in the BRIC countries. Together with health care, retirement arrangements are the focus of social security reforms. Whereas for health care the main reasons for its dominant place in building up and extending social security is related to its fundamental nature and to the international medical and pharmaceutical complex, the reasons for retirement arrangements reflect the societal changes, such as changing family patterns and demographic changes and the possibility of directly linking benefits with contributions. That is not as feasible for other branches of social security.

The demographic facts of the countries determine the age for eligibility for benefits and the related conditions for obtaining a pension (see Table 1).

The BRIC countries have in one way or another incorporated the three-pillar approach—company-provided benefits, private savings and social security payments. However, the first pillar is sometimes very weak, the focus being often on a compulsory but sector- or enterprise-based arrangement. This expresses of course the wish not to have larger redistribution, which is problematic when the first pillar is underdeveloped or even virtually absent.

In industrialized countries, continued working is often precluded for those receiving benefits payable at the onset of disability and in some cases at retirement as well as for their survivors. This appears to be less true in the BRIC countries. Perhaps this is because of the fact that legally restricting the possibility of returning to work makes little sense in countries with huge informal work sectors.

Noteworthy is that in some of the BRIC countries, the pension arrangements consist of one-off payments at retirement or of arrangements that allow accumulated capital to be taken before retirement to address other social needs (education of children, housing etc.).

As for the compensation mechanisms for work-related accidents and medical conditions, it is obviously crucial that the workers most threatened by a dangerous work environment be covered. Often, however, these workers are not covered since the so-called informal sector coincides to a large extent with the most dangerous work environments.

13. The Access to a Quality Health Care

The goal of having universal coverage of health care needs with quality care accessible to all, whatever the income of the patients and wherever they live, constitutes an enormous challenge for the BRIC countries. This is because the health care sector is a rather cost-intensive sector. In addition, the immense size of the BRIC countries, with their remote areas with low population density, makes the guarantee of accessibility of health care a costly endeavor. Here important trade-offs between quality and accessibility have to be made.

In all BRIC countries, there are private or semiprivate health care providers, services and products available to those (in the cities) who can afford to pay for them. It might be useful to require from this private health sector some more solidarity with the efforts of the states to provide accessible and qualitative health care to all.

The relatively large number of dependent people not able to work and receiving benefits makes the quality of care an important issue in BRIC countries. Although no dependency insurances seem to have emerged, it is clear that special attention is needed to upgrade the quality of care facilities provided for people in need, and also to find ways to provide the necessary care at home. The traditional home care by family members can be supported to that effect or new forms of home care stimulated.

14. Inflation and the Validity of Commitments for the Future

One of the worst enemies of a decent social protection system undoubtedly is high inflation rates (see Table 3). Although the situation has clearly improved in Brazil, Russia and India over the past years, inflation figures are still substantially higher than in the European Union (EU). In the 1990s, Brazil and Russia experienced inflation rates of three and four digits!

OPEN IN VIEWER

Table 3.

Comparative Inflation Rates

	European Union	Eurozone	Brazil	Russia	India	China
2010	2.1	1.6	5.0	6.8	13.2	3.3
2009	1.0	0.3	4.9	11.6	10.9	−0.7
2008	3.7	3.3	5.7	14.1	8.3	5.90
2007	2.3	2.1	3.6	9.0	6.4	4.8
2006	2.2	2.2	4.2	9.7	6.2	1.5
2005	2.2	2.2	6.9	12.7	4.25	1.8
2004	2.0	2.2	6.6	10.9	3.8	3.9
2003	2.0	2.1	14.8	13.7	3.8	1.17
2002	2.1	2.3	8.4	15.8	4.3	−0.8
2001	2.2	2.4	6.8	21.5	3.8	0.7
2000	1.9	2.2	7.1	20.8	4.0	0.4
1999	1.2	1.2	4.9	85.7	4.7	−1.4

Note. All figures are percentages. Figures for the European Union from Eurostat and for BRIC countries from International Monetary Fund’s World Economic Outlook Database, April 2011.

Countries like Russia and China have experienced in their recent history very important changes in societal organization. Market mechanisms and self-responsibility are now stressed. This might undermine the confidence of people in arrangements set up by the government.

One has indeed experienced already the removal of the “all providing” state: how to trust that the social security commitments for the future will be held? In a way, a similar loss of trust may be produced by high inflation. Indeed, when in some of the BRIC countries, inflation rates have in the not too distant past been very high, will people believe that saving, even in the form of social security, will give them any security? It is in this respect noteworthy that the constitutional and legal provisions dealing with social security in Brazil pay close attention to guaranteeing the real value of the social security commitments. Notwithstanding these and similar guarantees in other BRIC countries, one can notice that often the returns on the funded schemes are not sufficient to even make up for inflation, which certainly questions the validity of the financing via funded schemes.

15. Identification of Recipients and IT-Related Issues

BRIC countries struggle with keeping records of the persons covered by the various social insurance arrangements or benefiting from social security benefits. This problem may be overcome by better registration of the population and the introduction of national (social security) identification numbers, which is not an easy enterprise in huge countries like the BRIC.

The complexity of social security administration has been accompanied by an extraordinary complexity and diversity of administrative tools. Especially introducing IT for use in administering social security has not eased the interaction between the various social security agencies. This may be deplored the more because the introduction of IT is a rather costly operation for countries. Moreover, one has to realize that the internal communication between establishments of the same social security administration may have to be set up over great distances and between places with very divergent infrastructure.

16. Globalization and Worldwide Competition

It is not the industrialized countries alone that are worried about the impact of globalization and more specifically what this means to their social security systems. The BRIC countries are also well aware that they are developing their economies in a very competitive global environment. Even more than in the West, the argument is heard in the BRIC countries that social security arrangements should not burden the growth of business enterprises. In other words, if globalization exerts a downward pressure on the social security systems of the West, this is also the true in the BRIC countries and even in the less developed countries.

This pressure leads to self-fulfilling prophecies. One should dare to observe that this course of events is by no means necessary and that international agreements could stop this pressure. Just like enterprises at the end of the 19th and the beginning of 20th centuries could impose social standards without impoverishing society, this could also be realized on a world scale—if the political will to do so is present. This is not an argument against the market economy, but it is arguing that only a socially corrected market economy is sustainable in the long run, in both political and social-economic perspectives.

17. Need for a Sustainable Financial and Economic Foundation

The BRIC countries finance their social insurance arrangements through the usual channels, that is, state subsidies and contributions mainly from wage earners and employers.

In some countries, the financing of social security is very much geared to keeping the linkage with the paying individuals. This is important not only with Defined Contribution systems but also in arrangements where the proceeds of the wage earner of voluntary contributions escape all redistribution, and may sometimes even be claimed back by the one who paid them.

It seems that only in a limited way are social security arrangements in the BRIC countries being financed through so-called alternative channels. In Brazil, this is the case through the levies on lotteries and some imports; also, in India, levies on some imported and exported products cofinance social security arrangements.

In the future, it will be a challenge to choose the optimal source for financing of social security. Next to the usual channels, that is, contributions and state subsidies, new sources will be crucial to preserve not only economic growth but also a healthy financial environment in the BRIC countries. This relates, for instance, to earmarked taxes on exports, on energy, on environmentally damaging products or on unhealthy products. Though these are creative ways of financing social security arrangements, the development of social security could be better linked with the growth of economic capacity and the accumulation of wealth (by few). It goes without saying that this is only feasible if there is the political will and strength to do so.

18. The Interaction Between Social Security, Social Policy and Other Policy Areas

Perhaps even more than in the more industrialized nations, it is important to remember that social security is only one channel through which social policy goals may be realized and that social policy is very much linked to other societal and economic features.

All this is also true for social security law, as it is interconnected with other branches of law:

19. Deficient Implementation, Management and Sanctioning

A complex administration, with many actors and layers is not always controlled and sanctioned in the most appropriate or effective way.

This is even more so in cases where the traditional authority of the state is not seriously challenged or when citizens lack the knowledge or material capacity to challenge the administration. Corruption sometimes adds to the problem; informal private payments for health care services can also erode the real accessibility to the health care system.

Where the social security system is provided with solid legal control, the judiciary may make control actions difficult. This was illustrated by the Brazilian case where the principle is that the administration has to prove that people do not qualify for a pension (e.g. because they are dead), which makes combating against phantom pensions difficult.

20. Need for Other More Creative Answers

As we explained at the beginning, the paradigm or model for social security in the BRIC countries appears somewhat unclear and undefined. This may be explained by the origin of social security in the industrialized countries and the less fitting character of the social security arrangements for newly developed or developing economies.

The International Labour Organization continues to argue that social security is a good that is to be shared on a universal basis. Yet we could ask ourselves whether the way social security has been conceived in the West is really the most appropriate model for the BRIC countries. In this respect, we can also debate, for instance, whether in countries with a huge informal sector, unemployment benefit schemes as such make sense. Also the ecologic impact of certain industries in the BRIC countries may call for social security responses comparable with the work-related accident and injuries schemes developed in the industrial world.

It is also striking to see that although BRIC countries have a huge migration of people from one region to another, very little attention is paid to the social protection of these groups. It might be a good idea to pay more attention to the needs of these emigrants.

. . . And How Does All This Relate to the Main Findings in Our Social Security Quo Vadis Research in Western Europe?

The question is easy to ask, quite difficult to answer though. Some common issues may surprise as may some fundamental differences. Personally, we were rather impressed by the important, but complex, demographic challenge faced by the BRIC countries. Whereas we concluded earlier that the basic solidaristic paradigm of social security in Western Europe was suffering of a lack of clarity for the concerned population, it seems that in the BRIC countries, the basic model on which to build social security still remains to be defined. Whereas the challenges social security is confronted with in the BRIC countries and the EU are sometimes similar—demographic challenge, changing family patterns, need for a more effective administration, IT-related issues and vanishing traditional family model—we have to keep in mind the substantially different reality these challenges present the two spheres. Accordingly, we must not make the assumption that the challenges being comparable, the ways to address them may be similar.

Since in Europe social security covers the largest part of the population and certainly of the working population, it is crucial that all able-bodied adults below a certain age work and hence contribute to the financing of social insurance. In the BRIC countries, the main challenge consists in bringing more people under social security by transferring them from the informal to the formal sector. It is, however, questionable whether all BRIC countries are ready to take up this challenge, when this would expose their upcoming economies to additional financial burdens.

A similar question arises in relation to the internal diversity of social protection within the BRIC countries. Of course, such diversity exists within the EU, but we should not forget that the BRIC countries have more inhabitants and/or are bigger than the whole EU. Yet accepting huge differences in living standards and social protection levels within one country and a reluctance to establish solid and transparent solidarity mechanisms between the poorer and richer regions or segments of the population may in the long run pose very serious problems.

We were also struck by the fact that not only in Western Europe but also in the BRIC countries, the argument of globalization was being used against the development of social protection: to face competition on the global scale. One needs to be modest in social ambitions, so it is said. But what if we would accept to join hands and turn the arguments of globalization around—in favor of a decent social protection for all. But I guess this remark is a bit too idealistic . . . and thus remote from real life. Anyhow, with these few remarks, we hope to stimulate the debate: a debate on a global scale and indeed relevant for the future of the planet.