[kaid]

A welfare state, is a system defined and dictated by a huge monolithic institution(a government). The welfare such institution provides, is not without prices. You surrender many aspects of freedom, and the ability of proper risk management. The hatred among different classes and political groups grows more intense, there are less and less probabilities they would collaborate. Each group has a feeling of being robbed by the opposing groups.

[incompatible]

Institutions such as governments are no fun to deal with, and I'm sure that's especially true if you are dependent on them to survive. What would you suggest as an alternative?

[kaid]

I'm no expert in giving solutions on situations this complex. There could be various ways of doing autonomous communities. People should be able to organize and manage communities based off their ideologies, instead of obeying to a general enforcement. There's a larger chance, that autonomous communities may have more economic and innovative ways of solving conflicts and doing collaboration/cooperation between each other or within their own hierarchy.