policymakers demonstrate

Inequality and Welfare: Is Europe Special? 557
can be preventive or curative, but any adequate public expenditure in this
domain should have a high social return. It will not replace any other existing
public policy, activation of the labour market, social benefits and so on. I will
view all these actions as complementary, not as substitutes. I do not claim that
there should be a trade-off between any mental health public policy and other
existing public policies, even if an efficient mental health policy may lead to
saving money on other social programmes.
For children, taking care of mental health problems is their parents’ responsibility,
and if they do not care, social policy has to compensate for parents’
deficiencies. This is a direct consequence of an equality of opportunity policy,
whereas for adults, it is a different inspiration to some extent. It can be termed a
‘standing-up policy’, to help people to cope with the difficulties of life in a complex
and competitive society. Not all people are well-equipped, and some may
be severely handicapped in that matter. Dworkin (1981b) would have probably
supported such a policy since it can be viewed as a lack of internal resources
of a specific kind that should be compensated by external resources. Following
this line of reasoning will lead to include retirees into the social programme
improving mental health. A research programme into what could be the goals
and the ways to build up a standing-up policy is our third research proposal.
12.9 Issues More Specific to Europe
Two issues seem to be more specific to Europe as an emerging fiscal federation.
On the one hand, mobility of capital and labour result from country differences
in tax regimes and are induced by the fact that tax matters remain the symbol
of national sovereignty, and, on the other hand, mobility undermines this tax
sovereignty.
Tax competition on capital. Capital is more mobile than labour and the concern
is about the impact of capital mobility on the possibility to tax capital, in
the first place. Tax competition seems to have induced a race to the bottom,
both in statutory and effective tax rates. Corporate tax rates are indeed higher
in the US than in most European countries. There is a concern that it will be
more difficult to tax capital at the national level, unless more coordination or
harmonization is effectively implemented.
The sustainability of the nationwide welfare state in the Eurozone. The second
issue is more specific to the Eurozone and is related to the sustainability
of the nationwide welfare state. This is under threat both from an internal and
external perspective. The internal challenge with all welfare systems is that
they are vulnerable to mistakes. Two common mistakes are related to false
positives and false negatives: respectively, giving support to those who do not
deserve it and not giving support to those who do. A fundamental question
in the design of welfare policies, then, is to determine how one should make