Carsten Jensen - Reforming the Welfare State

The welfare state was one of the biggest social and political achievements of the 20th century, and two decades into the 21st it remains a defining characteristic of Western societies. Yet the so-called Golden Age of the welfare state in the 1950s, 1960s and early 1970s is long gone. Since the 1980s, a series of deep socio-economic transformations from the rise of the service economy, over an augmenting age burden, to mountains of public debt have ignited widespread and often intense debates about the proper role of the welfare state.

Much ink has been spilled on the effects of the past decades political reorientation, not least in terms of increased inequalities and the emergence of new, precarious groups in Western societies. Understanding the structure of the associated new social risks has become a major focal point in the academic literature (e.g. Esping-Andersen 1999; Esping-Andersen 2009; Standing 2011; Stiglitz 2012; Atkinson 2015; Putnam 2016). Similarly, many studies have analyzed the socio-economic preconditions of these changing outcomes, such as the emergence of new political coalitions between occupational groups (e.g. Beramendi et al. 2015; Iversen and Soskice 2015; Manow et al. 2018).

What has received considerably less attention is the nature of the policy reforms that transmit the new political landscape into new socio-economic outcomes, i.e. what policy instruments are governments employing to achieve their goals? This is an important omission because policy instruments the concrete legislative measures which make up welfare state reforms are rarely impartial. The choice of one policy instrument over another, for example the decision to adjust indexation rules instead of cutting benefit levels, not only reflects a governments wish to obtain some desired end-result, such as lower taxes or higher social mobility, but also serves a number of intermediate and sometimes much more salient political needs. A governments primary political need, of course, is its own reelection, but may also include auxiliary ones, such as strengthening or weakening specific social institutions such as labor unions. Although we may see such motives as irrelevant or perhaps even normatively undesirable, they are part and parcel of political life and one important reason why the needs and preferences of citizens are seldom mapped directly onto policy. Government politics, in short, is not a neutral transmission belt between citizens, on the one side, and social outcomes, on the other side.