Europe's welfare state to make way for austerity as debt crisis threatens to revive nationalism

By Business editor Peter Ryan - analysis

Europe's welfare state is almost certain to be slashed or even destroyed as taxpayers pay the price for the deepening sovereign debt crisis.

The austerity bill is likely to include deep cuts to social welfare programs created in the wake of World War 2 and expanded through the introduction of the European Union.

While banks endure heavy losses from their exposure to sovereign debt, taxpayers in the Eurozone - especially those from the baby boomer generation - are bracing for increased retirement ages, cuts to free education and stricter guidelines around universal health coverage.

There are already signs of protectionism and nationalism in some struggling economies as voices from right wing splinter groups seize on deepening community unrest.

I discussed the possible end of the welfare state during a recent visit to Brussels with economist Hans Martens, chief executive of the European Policy Centre. 

Read my article posted on The Drum.

Note: I travelled to Brussels as a guest of the European Commission.