THE DEVELOPMENT OF U.S. SOCIAL POLICIES USW 31, October 29, 2014 Theda Skocpol

Overview of major phases in the development of U.S. social provision; and U.S. in comparative perspective. Next two lectures: social policies and new realities; health care reform and inequality.

What images and ideas do these phrases bring to mind? “Welfare” “Welfare state”

“Welfare state” has an ambiguous meaning in the United States. Scholars use this term to refer to the entire pattern of social expenditures in a nation (and some include indirect “tax expenditures” and “tax credits”). But in everdAmerican popular discourse, “welfare” refers to programs targeted on the poor alone. Such programs have not been very well supported in U.S. democracy, and the term “welfare” often has a negative connotation -- in contrast to “social security” which has a positive ring for most Americans.

THE POLITICAL FORMULA FOR GENEROUS AND SUSTAINED PUBLIC SOCIAL SPENDING IN THE UNITED STATES  Benefits for service: successful programs reward or prepare individuals for service to the nation/community.  Broad constituencies: successful programs include the middle class along with the poor.  Partnerships between government and citizens’ associations: grow up to support and expand inclusive programs.  Reliable public revenues: the most successful programs have access to dedicated taxes or growing national taxes.

MAJOR DIRECT SOCIAL EXPENDITURES IN U.S. DEMOCRACY  Public schooling: primary and secondary schools spread across localities and states from the in the early 19 th century.  Programs for mothers and children: mothers pensions, workplace regulations spread across states in 1910s, and the federal government created the Children’s Bureau and the 1921 Sheppard- Towner Act.  “Social Security” old-age insurance: launched in 1935 as part of the Act with that name. Expanded in steps 1939 to 1956 to cover survivors, virtually all employees, and include disability benefits.  GI Bill of 1944: offered WWII veterans generous education, family, and employment benefits, and loans for homes, farms and businesses.  Medicare and Medicaid in 1965; Affordable Care 2010ff: to fund health insurance for elderly and lower income people.

The political basis for sustainable social provision fell apart after the 1960s  racialized conflicts over affirmative action and welfare for the poor.  generational gaps and the missing middle – few programs for working-aged adults and their children.  advocacy groups pushed social spending for children or the elderly, but unions and broad citizens’ associations went into decline.  resistance to taxation grew, and indirect tax subsidies became the major route for expanded social provision

Source: Jacob Hacker, The Divided Welfare State, p. 30.

After-Tax Public and Private Social Spending, 1995 Source: Jacob Hacker.

Public and Private Social Expenditures as Percent of Gross Domestic Product, 2007 Source: Jacob Hacker.

Private Expenditures as a Share of Total Social Spending, 2007 Source: Jacob Hacker.

Source: Christopher Howard, THE HIDDENWELFARE STATE (1997). Despite the recent expansion of the Earned Income Tax Credit (EITC), which primarily benefits the less-well-off, most “hidden welfare state” tax expenditures go to the privileged. Tax credits and refunds are also harder for the poor to understand and use -- and difficult to use for popular political mobilization.

Irv Garfinkel, Lee Rainwater, & Timothy Smeeding Inequality at Harvard 2/14/11

Widely Believed Half Truths/Nonsense –The welfare state is a drag on productivity. –The US has an unusually small welfare state. –The US always has been a welfare state laggard. The Truth –The socialized programs of welfare states complement capitalism and enrich nations. –The US welfare state is quite large. –For most of the 19 th & 20 th Century, US was a leader in education, the most productive part of the welfare state. We no longer lead.

Gross Size of Welfare States in 1900 (with and without education) Source: Lindert, P. (2005) Growing public: Social spending and economic growth since the eighteenth century.

Social Welfare Transfers as a Percent of GDP (with and without employer-provided benefits) Source: OECD, FY2001

Social Welfare Transfers in US $ Per Person (with and without employer-provided benefits)

SSN Briefs on Tax Expenditures Available at Christopher Howard, “Tax Expenditures: What They Are and Who Benefits.” Leonard E. Burman and Marvin M. Phaup, “Could Reducing Tax Expenditures Tame the Federal Debt?” Suzanne Mettler, “Why Americans Can’t See Government – And Why It Matters.”