You also pay for a bureaucracy to perform administration and fight abuse. That consumes a fraction of the system's resources. It's hard to argue that this adds much value, or any.

What this system boils down to is a compulsory savings scheme. So an alternative would be a voluntary savings scheme, which would have higher efficiency by not consuming resources for administration.

Of course the obvious downside to a voluntary savings plan is that it isn't effective at actually creating savings. We know this, because in the United States, we don't have compulsory savings plans, and thus have a voluntary system. So how's that working out? Not well. Approximately half of all Americans save 5% or less of their income[0], which isn't enough for emergency situations. Another study in 2013[1] said 27% had no savings at all. Now the main reason for this is quite simple. A lot people don't make enough to have anything so save.

[0] http://money.cnn.com/2015/03/30/pf/income-saving-habits/ [1] http://money.cnn.com/2013/06/24/pf/emergency-savings/

i think maybe only Swiss here have really sustainable model; others I know are typical socialist let's-make-more-and-more-debt-with-unsustainable-social-benefits (happy to learn if it somewhere else it works and can work in foreseeable future too without creating huge debt, forcing people to work in their late 60' etc).

What Swiss specifically have - we all pay social deductions, within 3 pillars. If you end up unemployed, then you are entitled to 1-2 years of unemployment benefits in 70% of your former income, with some reasonable cap. That is if you worked 100%, in perm contract, at least a year in a row. Otherwise not entitled or payments are much lower.

You have to actively search daily for new job and prove it to your unemployment councilor, otherwise they will cut benefits. Those benefits are really structured in a way to pay you while you are looking for a job, not to have some extra long holidays on everybody's else budget.

Motivating setup, and since there is a social net of that 70% of my income, I am not frightened on the prospect of losing job and needing to store enough cash to live at least X months/years without any income. Handy when one has big fresh loan on his shoulders.

There's nothing particularly Swiss about it, similar schemes exist throughout Northern Europe.

In Norway you can get 1-2 years benefits at about 60% your previous annual income with a cap near median national income.

These are nice schemes but the caps are worrisome. Modern professionals in North America pile on so much debt (student loans of a few 100K, mortgage debt of a lot more, etc.) that the countries average income doesn't reflect reality. In the Bay area, I hear laments from people making 200K that they cannot make ends meet. It is a crazy world.

You can have your student debt repayments frozen here while unemployed, at the national bank's rate. Plenty of people with high mortgages too, but duh. We aren't living in a perfect world.