“A Thinner Slice from a Bigger Pie Still Means More Pie.” How different things are from 1946.
There’s been a series of posts about whether or not health care reform signals the completion of the liberal welfare state (Yglesias, Chait, Ezra Klein). I think this is an interesting conversation, and the larger question of where do progressives and liberals go from here is important. Some quick thoughts:
- At a conceptual level, I don’t think the concept of liberalism is completable project. There will always be new things to debate. For instance, I consider Net Neutrality part of the project, a project where there is public access to a public sphere of speech, production and consumption that isn’t conditional on price discrimination. There’s is also obviously a lot that hasn’t been done, from carbon pricing to immigration reform to the military state to prisons, etc. But this conversation is on the liberal welfare state.
- One of my favorite books, Alan Brinkley’s The End of Reform: New Deal Liberalism in Recession and War, has a good working definition of liberalism leaving the Roosevelt administration:
The liberal vision of political economy in the 1940s rested…on the belief that protecting consumers and encouraging mass consumption, more than protecting producers and promoting savings, were the principal responsibilities of the liberal state. In its pursuit of full employment, the government would not seek to regulate corporate institutions so much as it would try to influence the business cycle. It would not try to redistribute economic power and limit inequality so much as it would create a compensatory welfare system (what later generations would call a “safety net”) for those whom capitalism had failed. It would not reshape capitalist institutions. It would reshape the economic and social environment in which those institutions worked.
So that’s a two part description of the liberal state – #1 you would have the government maintaining full employment, empowering workers and giving them more bargaining power, and #2 you would have a safety net for those who fell through the cracks.
I think it is safe to say that liberals have abandoned #1 and doubled-down on #2. The government can do things to make individual workers more productive, say investing in their education and health, but the government should not do things to explicitly give them more bargaining power. I agree with Kevin Drum that the moment this is abandoned politically a power imbalance grows, and it’s not surprising that you see stagnating wages and a public policy that is guided towards benefitting the richest.
- I don’t believe that those two can exist without each other. Without a strong middle and working class you don’t have natural constituencies ready to fight and defend the implementation and maintenance of a safety net and public goods. The welfare state is one part, complimenting full employment, of empowering people and balancing power in a financial capitalist society.
This is collapsing in real-time. One working definition of an approach to liberalism is “It’s best to just maximize growth rates, pre-tax distribution be damned, and then fund wicked-good social insurance with huge revenues from an optimal tax scheme” (Karl Smith, Wilkinson). I’d ask where are all these increasingly wickedly-well funded programs? We just had to bribe the top 3% with massive tax cuts for the next two years in order to keep unemployment insurance extensions in place for another year. Unemployment benefit extension are a net job creator and should have been a no-brainer, but it couldn’t pass without a massive bribe. This doesn’t include the brutal battle for extending health care to an additional 30 million+ people. This is even after the Federal Reserve created an alphabet soup of wicked-good safety net for the top 3% of the financial system, it’s difficult to get extra benefits for working-people in the largest post-war downturn.
Public universities are being defunded at exactly the moment when people are most focused on a “polarized” job market and a lack of supply of high-skills. Jeffrey Williams asks us to consider student debt as a modern equivalent of indentured servitude, and I think the comparison is correct.
- To me, the end result of having a safety net without giving workers stronger bargaining power is that what you end up with is a kind of pity-charity liberal capitalism. That’s better than nothing, but at the end it can be a dead-end, if the government doesn’t step in to fight for full employment. Particularly if you think of unemployment as a particularly scarring state of existence and, like me, think that the next major battlegrounds already are closer looks at production and the experience and conditions under which people work.