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Social Policy and the American Welfare State M01 KARG7080 SE 06 C01.QXD 1/23/09 1:09 PM Page 2 M01_KARG7080_SE_06_C01.QXD 1/22/09 10:55 AM Page 1 CHAPTER 1 Social Policy and the American Welfare State M01_KARG7080_SE_06_C01.QXD 1/23/09 1:09 PM Page 2 2 PART 1 American Social Welfare Policy ocial welfare policy is best viewed through the providing tax credits for couples earning less S lens of political economy (i.e., the interaction of than $200,000 annually. economic, political, and ideological forces). This • Jump-start the economy through a $700 billion chapter provides an overview of the American wel- stimulus package that included $25 billion for fare state through that lens. In particular, it exam- infrastructure projects as well as $25 billion for ines various definitions of social welfare policy, the state and local governments. relationship between social policy and social prob- • Introduce progressivity in the withholding tax lems, and the values and ideologies that drive social by adding a tax of 2 to 4 percent for individuals welfare in the United States. In addition, the chap- whose incomes exceed $250,000 a year. ter examines the effects of ideology on the U.S. wel- • Require that all children have health insurance, fare state, including the important roles played by prohibit insurance companies from refusing to conservatism and liberalism (and their variations) insure people with pre-existing conditions, and in shaping welfare policy. An understanding of mandate that employers provide health insur- social welfare policy requires the ability to grasp the ance to workers or pay into a health insurance economic justifications and consequences that fund. underlie policy decisions. As such, this chapter con- • Spend $10 billion to expand and improve pre- tains a brief introduction to Keynesianism, free school education and $12 billion for higher edu- market economics, socialism, and communitarian- cation in the form of a $4,000 refundable tax ism, among others. credit in exchange for 100 hours of community American social welfare is in transition. Starting service.1 with the Social Security Act of 1935, liberals argued that federal social programs were the best way to While liberal pundits hailed the resurgence of “a help the disadvantaged. Now, after 70 years of exper- vast new progressive movement,”2 structural limits imenting with the welfare state, a discernible shift would certain restrain Obama’s ambitions. Massive has occurred. The conservatism of U.S. culture— deficits left by the second Bush administration com- so evident in the Reagan, Bush (both Bushes), and pounded by a looming recession mean that eco- even Clinton presidencies—has left private institu- nomic issues will not only trump other priorities, but tions to shoulder more of the welfare burden. For that reduced tax revenues will impede the ability of proponents of social justice, the suggestion that the the government to meet existing obligations let alone private sector should assume more responsibility for expand social programs. Moreover, the Republicans welfare represents a retreat from the hard-won gov- can filibuster Democratic initiatives in the Senate ernmental social legislation that provided essential that are perceived as being particularly generous. benefits to millions of Americans. Justifiably, these Obama’s centrist inclinations will help build biparti- groups fear the loss of basic goods and services dur- san support for his legislative agenda. This was evi- ing the transition in social welfare. dent in his understanding of welfare reform. The political trajectory shifted with the 2008 Acknowledging that “conservatives—and Bill election. The election of Barack Obama as the 44th Clinton—were right” to scrap the Aid to Families with President of the United States not only broke a Dependent Children program, Obama also recog- racial barrier but also swept away the strident nized that welfare reform had “swelled the ranks of conservatism that had defined the presidency of the working poor.” Consequently, he argued that a George W. Bush. Winning 52 percent of the vote and post-welfare reform anti-poverty policy must entail increasing Democratic majorities in both chambers increasing the Earned Income Tax Credit for low- of Congress, the Obama victory heartened liberals income working families, but also expanding com- who anticipated an expansion of government social munity-based health and education as well as law programs. Obama’s platform was crafted to appeal enforcement.3 Clearly, economic and political cir- to middle-class voters who had lost ground econom- cumstances will test the new president’s leadership in ically during the second Bush presidency and managing domestic affairs and therein social welfare. included the following objectives: Despite the Democratic victory in 2008, struc- tural features of the American welfare state militate • Increase capital gains taxes on individuals against a major expansion of government, per se. making more than $250,000 per year while A pluralistic mix of private and public services is an M01_KARG7080_SE_06_C01.QXD 1/22/09 10:55 AM Page 3 CHAPTER 1 Social Policy and the American Welfare State 3 overriding feature of U.S. social welfare. As in other through privatization. Yet past advocates of social realms, such as education, in social welfare private justice such as Jane Addams, Whitney Young Jr., institutions coexist alongside those of the public and Wilbur Cohen, to name a few, interpreted the sector. U.S. social welfare has a noble tradition of inadequacy of social welfare provision and the con- voluntary citizen groups taking the initiative to fusion of their times as an opportunity to further solve local problems. Today, private voluntary social justice. It remains for another generation of groups provide important services to AIDS patients, welfare professionals to demonstrate the same the homeless, immigrants, victims of domestic vio- imagination, perseverance, and courage to advance lence, and refugees. social welfare in the years ahead. Those accepting Social welfare has become big business. this challenge will need to be familiar with the vari- During the last 30 years, the number of human ous meanings of social welfare policy, differing service corporations—for-profit firms providing political and economic explanations of social wel- social welfare through the marketplace—has fare, and the multiple interest groups that have increased dramatically. Human service corpora- emerged within the U.S. social welfare system. tions are prominent in long-term nursing care, health maintenance, child day care, psychiatric and substance abuse services, and even correc- tions. For many welfare professionals, the privatiz- Definitions of Social ing of social services is troubling, occurring as it does at a time when government has reduced its Welfare Policy commitment to social programs. Yet human serv- ice corporations will likely continue to be promi- The English social scientist Richard Titmuss nent players in shaping the nation’s social welfare defined social services as “a series of collective policies. As long as U.S. culture is democratic and interventions that contribute to the general welfare capitalistic, entrepreneurs will be free to establish by assigning claims from one set of people who are social welfare services in the private sector, both as said to produce or earn the national income to nonprofit agencies and as for-profit corporations. another set of people who may merit compassion The mixed welfare economy of the United and charity.”4 Welfare policy, whether it is the prod- States, in which the voluntary, governmental, and uct of governmental, voluntary, or corporate institu- corporate sectors coexist, poses important ques- tions, is concerned with allocating goods, services, tions for social welfare policy. To what extent can and opportunities to enhance social functioning. voluntary groups be held responsible for public wel- William Epstein defined social policy as “social fare, given their limited fiscal resources? For which action sanctioned by society.”5 Social policy can groups of people, if any, should government divest also be defined as the formal and consistent order- itself of responsibility? Can human service corpora- ing of human affairs. Social welfare policy, a sub- tions care for poor and multiproblem clients while set of social policy, regulates the provision of bene- continuing to generate profits? Equally important, fits to people to meet basic life needs, such as how can welfare professionals shape coherent social employment, income, food, housing, health care, welfare policies, given the fragmentation inherent and relationships.6 in such pluralism? Clearly, the answers to these Social welfare policy is influenced by the con- questions have much to say about how social wel- text in which benefits are provided. For example, fare programs are perceived by human service pro- social welfare is often associated with legislatively fessionals, their clients, and the taxpayers who con- mandated programs of the governmental sector, tinue to subsidize social programs. such as Temporary Assistance for Needy Families The multitude of questions posed by the transi- (TANF). In the TANF program, social welfare policy tion of social welfare in this country is daunting. consists of the rules by which the federal and state Temporarily satisfied by the draconian 1996 welfare governments apportion cash benefits to an econom- reform bill (and the dramatic cuts in the nation’s ically disadvantaged population. TANF benefits are public assistance rolls), conservatives
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