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Social Welfare Policy Analysis

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MODULE III THE WELFARE STATE READINGS PART I, 2-3; V 6/6 12 SESSION 3: THE WELFARE STATE (WS) The totality of social welfare programs in a given national setting. – PowerPoint PPT presentation

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Title: Social Welfare Policy Analysis


1
MODULE III THE WELFARE STATE READINGS PART I,
2-3 V 6/6 12
2
SESSION 3 THE WELFARE STATE (WS)
  • The totality of social welfare programs in a
    given national setting.
  • Most elaborate in the most advanced
    countries---W. Europe, N.A., and Australia/New
    Zealand.
  • W. European WSs tend towards the mature or
    cradle to grave type, whereas the US WS is
    usually classified as immatureand
    characteristic of our national exceptionality.
  • American domestic politics is principally about
    two sets of issues---1) the so-called social
    questions, like abortion and family values 2)
    the contents of and eligibility for WS benefits.
  • All these issues are linked the immaturity of
    our welfare state reflects our politics, which in
    turn reflects the exceptionality of American
    circumstances, as variously interpreted.
  • Each of the above points will be addressed in
    this session.

3
SESSION 3 TABLE OF CONTENTS
  • Conflicting political perspectives on the WS.
  • Types of WSs.
  • Reasons for US exceptionality.
  • Globalization and the Future of the WS.

4
CONFLICTING PERSPECTIVES ON THE WELFARE STATE
VS.
5
A LIBERAL PERSPECTIVE
  • Im often asked if Im a liberal, and I say,
    Well, if Jack Kennedy was a liberal or
    Franklin Roosevelt was a liberal, then Im a
    liberal. This is not 1960, and its not 1932.
    Were in a completely different world than then.
    But I believe in opportunity, and I believe
    infairness. The only way this country prospers
    is if everybody is sharing in the prosperity. I
    think my party has uniquely stood for that,where
    government can be an active partner with the
    private sector in moving the country forward.
  • RICHARD GEPHARDT
  • DEMOCRATIC LEADER,
  • US HOUSE OF REPRESENATIVES.

6
THE LIBERAL PERSPECTIVE EXPLAINED
  • Liberals support a moderately high level of
    social services, but tend to favor equality of
    opportunity more than equality of social
    condition. They do believe that society has a
    duty to help the poor and oppressed, and to make
    appropriate arrangements for the young and
    elderly, but they would not go as far as social
    democrats and other radicals in the pursuit of
    these goals.
  • Many liberals also believe that the educated
    elite should lead society and that the power of
    rational persuasion (ideas again) are
    sufficient to convince voters of the moral
    correctness of their aims they are thus
    idealists in the strictly philosophical sense
    of the term.
  • The dominant political ideology during certain
    periods of 20th century American history, classic
    reform liberalism reached its high tide during
    the Johnson years (1963 - 68). While still
    strongly supported by minorities, intellectuals,
    femininists, and various other groups, liberalism
    has essentially been on the defensive ever since.
    Indeed, the L word is now often shunned even by
    liberals themselves (although obviously not by
    Gephardt), who are afraid of alienating voters.
    Many liberals accordingly now prefer to be called
    progressives. That has not increased their
    electoral popularity, however.

7
A RADICAL PERSPECTIVE
  • THE CENTRAL QUESTIONIS WHETHER AND UNDER WHAT
    CIRCUMSTANCES THE CLASS DIVISIONS AND SOCIAL
    INEQUALITIES PRODUCED BY CAPITALISM CAN BE UNDONE
    BY LEGISLATIVE DEMOCRACY.
  • GOSTA ESPING-ANDERSEN
  • RADICAL WELFARE STATE ANALYST

8
A RADICAL PERSPECTIVE THE BALANCE OF
CONTENDING FORCES
  • To understand the WS, radicals contend you must
    first understand the relative political strength
    of the principal classes (forces) in capitalist
    society---on the one hand, the asset-owning rich
    (capitalists) and the top managers who work
    directly for them on the other, ordinary wage -
    dependent workers in potential political alliance
    with the new middle class of technical/professio
    nal workers.
  • As we saw in Module 2, distinct social classes
    can have distinctly different perceptions of
    their interests and, hence, different attitudes
    towards swps and the WS. Blue-collar workers may
    well look to the WS for socially financed
    protections against the uncertainties of life
    under capitalism, whereas owners see the WS as
    blocking their quest for a free market system
    in which worker resistance government
    intervention are minimized. (See the following
    section on conservative perspectives for more
    on this last point.)
  • Radicals thus view politics largely in terms of
    coalition-building, since failure to form such
    alliances means that, as in the US, the WS is
    likely to be limited.

9
A RADICAL PERSPECTIVE THE ROAD TO SOMEWHERE?
  • The very existence of the WS is evidence of class
    conflict each side seeks to control the size of
    the WS in order to gain leverage in its struggle
    with the other. Thus, capitalist political
    dominance (hegemony is the term used by radical
    intellectuals) is reflected in the extent to
    which WS programs are means-tested and modest in
    scale. By the same token, working class political
    muscle is on display if those same programs are
    generously funded and offer benefits to all
    citizens under the universality principle.
  • But is a generous WS itself enough to satisfy
    working class needs? Or is it necessary for
    workers to take a fateful step further and seek
    direct control of the nations productive wealth
    (capital) in order to assure its rational use
    for the benefit of all? The more radical radicals
    have at least until recently argued that such
    control is indeed indispensable and can only be
    secured via overthrow of bourgeois democracy
    the more moderate, that a humane social order can
    be attained through gradual evolution from the
    existing WS base towards a more egalitarian
    society. As well see in the discussion of
    globalization, later in this session, this
    longstanding controversy has recently been
    superseded by a more immediate question Can the
    WS itself survive at all given recent changes in
    the overall balance of contending forces.

10
A CONSERVATIVE PERSPECTIVE
  • MY CONCLUSION IS THAT IN ADDITION TO ITS
    STRONG MORAL BASE IN PERSONAL FREEDOM, CAPITALISM
    AND COMPETITIVE MARKETS WORK TO DELIVER
    SUBSTANTIAL ECONOMIC PROGRESSBUREAUCRATIC
    WELFARE STATES DO NOT WORK. THEY SAP INDIVIDUAL
    INCENTIVE, INITIATIVE AND CREATIVITY AND
    ULTIMATELY CANNOT DELIVER SUFFICIENTLY RISING
    STANDARDS OF LIVING TO MEET THE EXPECTATIONS OF
    THEIR CITIZENS.
  • MICHAEL BOSKIN
  • CHAIRMAN OF THE COUNCIL OF ECONOMIC ADVISERS
    DURING THE BUSH ADMINISTRATION

11
AN CONSERVATIVE PERSPECTIVE A DRAG ON THE MARKET
  • Conservatives argue that, especially in its more
    advanced European forms, the WS has become a
    dangerous anachronism. By requiring high taxes,
    the WS deprives society of needed investment
    resources and saddles employers with workers who
    feel that the are owed a living---by the state
    if not by the boss!
  • Conservatives concede that the WS may once have
    been fiscally tolerable (if never politically or
    economically desirable) but argue that it should
    now be dismantled because its extravagances are
    unsustainable in our age of intensified global
    competition. Indeed advanced nations that
    continue to adhere to old-style welfarism risk
    permanent inferiority within the emerging
    postindustrial division of labor.

12
A CONSERVATIVE PERSPECTIVE AN IDEA WHOSE TIME
HAS GONE
  • As we have just seen, conservatives view the WS
    as dangerously obsolescent. It represents the
    past, whereas the unimpeded free market is said
    to represent the future.
  • More specifically, conservative intellectuals
    assert that the WS is a product of the so-called
    Fordist period, when huge corporate
    bureaucracies (e.g., as in the auto industry)
    employed hordes of manual and administrative
    workers. Government developed similarly insofar
    as it consisted of cumbersome bureaucracies
    seeking to expand their regulatory turf.
  • Workers today, however, are necessarily far more
    self-reliant. Like their employers, they realize
    that they must be flexible and intensely
    competitive. The old-style Fordist WS has thus
    become an anachronism incompatible with
    postindustrial society. Conservatives claim that
    most Americans recognize this, which is why
    voters now regularly reject liberal attempts to
    revive the WS.

13
A CONSERVATIVE PERSPECTIVE AN IDEA WHOSE TIME
HAS GONE
CLICK HERE FOR EDU-RAMA!
This 4 minute discussion features professors
Samuel Bowles and Milton Friedman, respectively,
leading social democratic and conservative
welfare state analysts. Although fragmentary the
segment is worth watching for discussion of the
so-called Third Way, which is the name often
given to the Swedish WS experiment, and intended
to distinguish it from the US and Soviet
communist models.
14
WHAT DO YOU THINK?
Which of the just reviewed perspective makes the
most sense to you? (Doing the readings may help
you make up your mind!)
15
U.S. AND EUROPEAN WS MODELS COMPARED
  • As we shall see in the following section, U.S.
    and European wss are organized on very different
    assumptions, expectations, and principles.
  • Our task will be to summarize what those
    difference are and what accounts for them.
  • On the latter point, well look particularly at
    the issue of American exceptionalism---i.e. why
    the U.S. welfare state is so different from its
    European counterparts.
  • Finally, well briefly survey the issue of
    globalization, most particularly, the impact that
    that phenomenon is having on all welfare states
    regardless of their operating assumptions.

16
Mature and Immature Welfare States (1)
  • US
  • Relatively modest social insurance programs
    very limited means-tested protections against
    hardship or destitution.
  • EUROPE
  • Extensive social insurance other publicly
    funded non-means tested benefits and services
    designed to reduce relative inequalities and
    assure economic security for all citizens (i.e.,
    universalistic). These radical or social
    democratic objectives are characteristic of the
    most advanced European social welfare
    legislation, notably in Scandinavia.

17
Mainstream US SWEDEN (2) Social
Democratic
  • Social security
  • Unemployment insurance (ui)
  • Medicare/Medicaid
  • Public housing
  • Education through h.s
  • Limited maternity leave
  • Social security
  • Extended ui and job retraining
  • Health care for all
  • Housing allowance
  • Free education
  • Family allowances
  • Generous maternity leave
  • Pensions for all
  • Paid vacations
  • Public child care
  • Extensive recreation facilities

18
US WS MODEL A MARKET FIRST APPROACH
  • THE MARKET FIRST BIAS IS THE KEY TO
    UNDERSTANDING SPECIFIC COMPONENTS OF THE AMERICAN
    WS.

THE MARKET THE KEY U.S. INSTITUTION, WITH
WS PROGRAMS ESSENTIALLY SUBSIDIARY TO AND
SUPPORTIVE OF IT. PREVAILING ASSUMPTION IS THAT
VIRTUALLY EVERY NEED CAN AND SHOULD BE MET
THROUGH THE MARKET SYSTEM, EXCEPT AS NOTED BELOW.
SOCIAL INSURANCE SOCIAL SECURITY MEDICARE ENACTED
BECAUSE OF MARKET FAILURE, I.E., INABILITY OF
MARKET TO PROVIDE FOR BASIC NEEDS IN CERTAIN
SITUATIONS
MEANS-TESTED PROGRAMS TANF (welfare) SSI ASSISTANC
E TO INDIVIDUALS IF DEEMED DESERVING DUE
TO TEMPORARY OR PERMANENT INABILITY TO COMPETE IN
JOB MARKETS.
19
THE UNDERLYING LOGIC OF THE US WS
  • The dominant presumption in American society,
    especially strongly held among conservatives, is
    that all human needs can and should be met
    through the market, and that those unable to pay
    for commodities (i.e., goods and services
    purchased on the market) simply must forgo them.
  • However, two exceptions to this rule are
    sometimes recognized
  • Certain goods and services cannot be adequately
    provided exclusively through the market because
    of their very nature. For example, left to itself
    the market has been able of provide adequate
    health insurance only to those old people who are
    both rich and in reasonably good health---clearly
    a minority. At the very least, then, publicly
    organized, regulated, and partly subsidized
    health care social insurance is indispensable to
    ensure if the majority of old people are to be
    covered----hence, Medicare.
  • Those who are destitute or near-destitute, and
    unable to work by definition cannot and do not
    participate in the market economy. Unless
    subsidized by the government, they might well
    starve, which (presumably) still remains morally
    unacceptable in a civilized society---hence,
    public assistance (TANF) and Supplemental
    Security Income (SSI) for those able to meet
    their stringent eligibility criteria.

20
NEVERTHELESS
  • as the preeminent American institution, the
    market is constantly encroaching, in various
    ways, on ws programs. Thus
  • the American WS is in many respects a
    partnership between the public and private
    sectors the government buys WS goods and
    services from the private sector, because a)
    thats the only place they can be purchased b)
    of the political pressure exerted by vendors c)
    of the assumption that the private sector can
    provide such services more efficiently (i.e., at
    less cost) than the public sector.
  • the private sector is dynamic and accordingly
    constantly seeks to expand into public sector
    territory if profitable opportunities exist
    there. Hence the privatization movement of
    recent years, in which various publicly funded
    programs---e.g., welfare assistance and health
    services---are increasingly provided by private
    vendors working under government contract.
  • perhaps most importantly, there are prominent
    and even disastrous market failures that are
    not adequately rectified because of corporate
    political clout, which seeks to prevent
    government from trespassing, or even
    potentially usurping, existing profitable
    markets. The profit-driven health care system,
    despite its market failure to provide adequate
    coverage to millions, comes most readily to mind
    in this regard.

21
SWEDEN AND DECOMMODIFICATION
  • The Swedish WS, widely regarded as the world
    standard, is based on a radical---and hence
    markedly different---conception of what
    government can and should provide to its
    citizens.
  • Most dramatically, the Swedes have sought to
    decommodify a wide variety of goods and
    services (see earlier comparative slide), i.e. to
    remove them from the market and instead make them
    readily available to all as a right of
    citizenship---what American social policy
    analysts call entitlements.
  • In doing so, the Swedish social democratic
    government hoped to promote equality of results
    rather than simply equality of opportunity, on
    grounds people must have a wide variety of goods
    and services if they are to lead a decent life.
  • The next few slides take a closer look at the
    Swedish model.

22
THE SWEDISH WELFARE STATE A MULTIDIMENSIONAL
MODEL
  • Remember this figure? It first appeared in Module
    2 to illustrate the different levels at which
    policy is formulated.
  • The distinguishing characteristic in the Swedish
    case, however, is the high degree of planned
    integration among these three policy levels. That
    is, the key to Swedish success lay in assuring
    that each level operated so as to reinforce the
    other two.
  • The next slide provides an example of how this
    social democratic strategy works in practice.

PUBLIC POLICIES
SOCIAL POLICIES
SOCIAL WELFARE POLICIES
23
THE SWEDISH MODEL IN THEORY
Common Policy Objective
Creation of a what Swedes call a
peoples home humane,
egalitarian, yet also economically dynamic
  • SOCIAL WELFARE
  • POLICIES
  • Generous unemployment,
  • old age, and child
  • care benefits
  • Excellent health care
  • recreational facilities
  • PUBLIC POLICIES
  • State tax and other
  • support for new housing
  • corporate investment
  • Tight control over
  • capital exports
  • Low interest rates
  • SOCIAL POLICIES
  • Heavy investment
  • in education and
  • job training/retraining
  • Strict prohibitions
  • against gender
  • discrimination

24
THE SWEDISH MODEL IN PRACTICE THUS
  • PUBLIC POLICIES
  • State tax and other
  • supports for new
  • investment
  • HELPS RESULTS IN
  • Rapid job creation
  • low
  • unemployment
  • WHICH IN TURN
  • MAKES
  • POSSIBLE
  • Generous
  • unemployment
  • benefits job
  • retraining

ALL ELEMENTS INTHE SWEDISH MODEL ARE DESIGNED
TO BALANCE AND REINFORCE ONE ANOTHER
25
WHY THE DIFFERENCE? THE ISSUE OF AMERICAN
EXCEPTIONALISM
  • Lack of a politically significant radical
    political movement, and the consequent
    backwardness of the American welfare state, are
    often cited as proof that the U.S. is an
    exceptional country---not necessarily in a
    positive sense (although most mainstreamers
    certainly see it that way), but in its stark
    divergence from the European pattern of
    relatively generous and extensive WS benefits.
    The following American traits are also sometimes
    cited as further manifestations of our
    exceptionality
  • fear of and resistance to taxes and government
  • willingness to resort to capital punishment
  • lack of knowledge about other societies
  • tightfistedness in dealing with the poor
  • degree of racial prejudice
  • self-righteous moralism

26
WHAT ACCOUNTS FOR EXCEPTIONALISM? THE MAINSTREAM
VIEW
  • There is no single mainstream interpretation of
    exceptionalism, but there are certain common
    themes that mainstreamers have identified over
    the years. As one would expect, these tend to
    emphasize ideas and institutions, rather than
    social class relations. Following are several of
    these explanations
  • America fought a war of independence precisely
    to guarantee that government be limited, and
    subsequent national experience has only further
    deepened our rightful suspicion of centralized
    power. The nations commitment to local control
    and a checks and balance constitutional system
    are expressions of this same outlook.
  • Americans still adhere to the individualistic
    ethos. They expect to participate in competitive
    markets, and likewise once expected that those
    who failed competitively would try their luck
    elsewhere. But that was before the welfare state.

27
WHAT ACCOUNTS FOR EXCEPTIONALISM? THE RADICAL VIEW
  • Radicals have sometimes seemed near obsessed
    with the exceptionalism question, perhaps
    because their failure to achieve a significant
    role in American life has indeed been a defining
    feature of exceptionalism. Here, then, are some
    radical interpretations
  • American historical experience is significantly
    different from Europes, where a relatively
    homogeneous mass populations shared a common
    medieval past and a common working class way of
    life. For their part, the European ruling classes
    long sought to maintain an almost caste-like
    distance from the masses, and indeed democratic
    ideas did not really triumph in Europe until late
    in the 19th century---in some places, not even
    then. America, in contrast, was almost from the
    beginning a land of INDIVIDUAL opportunity that
    drew a heterogeneous immigrant population. The
    odds against forming an American radical
    political movement were thus formidable, and were
    made even more so by expansive prosperity that
    reinforced the individualistic ethos.
  • Throughout American history the political agents
    of the ruling classes have persecuted radicals
    under the bogus banner of Americanism, so that
    those holding dissenting views have frequently
    been ostracized as un-American. This has been a
    devastatingly effective tactic in repressing
    radical dissent. Intra-working class racial
    divisions has been yet another factor in the
    exceptionalist political equation.

28
INDIVIDUALISM A COMMON THREAD
  • As we have seen, both radicals and mainstreamers
    lay stress on individualism as a deep seated
    American trait at odds with the collectivist
    logic of the WS. Yet here the similarity ends.
    Whereas radicals view individualism as an
    essentially negative factor, obstructing the
    unity needed to promote a more egalitarian
    society, conservatives regard individualism as
    the central defining element in American
    life---the thing that made this country great.

29
THE IMPACT OF GLOBALIZATION
30
THE WELFARE STATE ADVANCE (1)
  • The welfare state is the product of many
    generations of popular struggle against injustice
    and oppression.
  • Its golden age (1945-70) was thought by many to
    mark a fundamental turning point in human
    history henceforth the benefits of industrial
    civilization would be distributed more equitably
    thanks to increased productivity, popular
    political pressure, and the need to maintain a
    high standard of consumption if capitalism itself
    were going to survive.
  • No one wanted to go back to the bad old days,
    when poverty was common and material insecurity
    the fate of most people.
  • In short, optimism about the future, specifically
    the future of the welfare state, was fairly
    pervasive.

31
WELFARE STATE ADVANCE (2)
  • The positive mood of this period was exemplified
    by the so-called Marshallian theory of the
    welfare state that posited the following 3 stage
    historical evolutionary progression
  • Social Rights (the ws/economic security)
  • Political Rights (parliament/the vote)
  • Legal Rights (courts/due process)

32
Welfare State Decline OR The
Professors Confounded
  • Political support and state funding have
    everywhere been declining around 1970.
  • As we have seen, some now retrospectively claim
    that the welfare state was simply an industrial
    age phenomenon anachronistic in the
    post-industrial era of specialist labor and
    individual initiative.
  • Globalization is, however, the most immediate
    causal factor in welfare state decline.

33
WHAT IS GLOBALIZATION, ANYWAY?
  • Globalization involves the rapid diffusion of
    investment and speculative capital, and, more
    generally, of the market economy, throughout the
    world. These processes are spearheaded by
    transnational corporations (industrial
    capital), seeking low cost labor and profitable
    markets regardless of national boundaries and
    investment banks and other agents of finance
    capital, looking for comparable speculative or
    investment opportunities with comparable
    indifference to old-style state boundaries.
  • Some governments in the larger capitalist states,
    notably that of the U.S., have actively partnered
    with the private sector and such institutions as
    the World Bank and World Trade Organization to
    make the world safe for capital by removing all
    national-level obstructions to the free flow of
    capital, thus weakening the nation-states
    ability to regulate its own territory and, more
    particularly, sustain a high level of welfare
    state services.

34
GLOBALIZATION THE MASTER THEME OF OUR TIME
  • It has promoted the
  • power shift from labor to capital from social
    welfare programs to corporate profit priorities.
  • downsizing of the welfare state and the
    non-profit sector
  • privatization and increased political and
    economic inequality

ITS ALL MINE!
Please let go of me!
35
WELFARE STATE DECLINE CAUSES, EVIDENCE, AND
CONSEQUENCES
  • Disappearance (?) of popular expectations that
    activist government could solve our national
    problems. (Social transformation/demographic
    fading of the Depression/WWII generation.)
  • Few new social welfare programs reduction or
    elimination of established ones
  • Privatization of former state services e.g.,
    prisons, welfare, and maintenance.
  • Growing economic inequality, racial tension, and
    political alienation.

36
GLOBALIZATION SUMMING UP
  • The impact of globalization has indeed been
    global, insofar as it has affected all aspects
    of life, and not merely the WS. There are two
    general ways of summing up the impact of these
    changes.
  • Radicals deplore globalization and instead
    continue to see government as a positive force
    capable of improving life through its capacity to
    plan, regulate, protect, and promote social and
    economic equality within traditional national
    settings.
  • The opposing globalization thesis, supported by
    conservatives and by our own government (indeed,
    it is sometimes called the Washington
    consensus), holds that markets rather than
    governments are the indispensable motors of
    material progress, and that government economic
    regulation must therefore be reduced to an
    absolute minimum.
  • The next slide summarizes two correspondingly
    divergent ways of envisioning the consequences of
    continued globalization.

37
ALTERNATIVE GLOBAL FUTURES
  • HOMOGENIZATION
  • Continuation of current trends resulting in
    creation of a globally integrated consumer
    culture, which replaces virtually all local
    cultures
  • Formal retention of state sovereignty and
    political democracy as a façade for corporate
    power.
  • RESISTANCE
  • Growing resistance to current trends based on the
    following possible factors
  • religious belief
  • possible collapse of the world economy
  • increased worker immiseration
  • environmental collapse

38
WHAT DO YOU THINK?
WHAT KIND OF WS WORKS BEST FOR SOCIETY? FOR THE
INDIVIDUAL CITIZEN? SHOUD QUESTIONS OF
SOCIAL JUSTICE BE DECIDED BY THE MARKET OR BY
LEGISLATIVE BODIES, LIKE CONGRESS? IS
GLOBALIZATION THE KEY TO PROGRESS, AS
CONSERVATIVES CLAIM, OR IS IT IN FACT THE SOCIAL
DISASTER, AS RADICALS CONTEND?
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