| Review of: | Insecurity and Welfare Regimes in Asia, Africa and Latin America: Social Policy in Development Contexts by Ian Gough, Geof Wood, Armando Barrientos, Philippa Bevan, P. David, R. Room Globalization and the Future of the Welfare State edited by Miguel Glatzer, Dietrich Rueschemeyer The Decline of the Welfare State: Demography and Globalization by Assaf Razin, Efraim Sadka |
|---|---|
| Reviewed By: | Alex Hicks |
| Reviewed in: | Governance |
| Date accepted online: | 02/11/2007 |
| Published in print: | Volume 20, Issue 2, Pages 359-371 |
Book Reviews: Societal Welfare and Welfare States Worldwide
Academic attention has recently turned from the advanced welfare states among rich democracies exclusively to the welfare state conception in its twin global guises: as a worldwide phenomenon and as a globally embedded phenomenon. However, our frames for studying welfare states have not kept up with this analytical turn. How, then, can we frame further discussions of welfare states across the globe and in the current global context?
One way of intellectually situating the welfare state is to focus on welfare not as poor relief, social insurance, or state economic intervention, but rather as individual and aggregate utility or as collective welfare. In their
Gough and Wood et al. are interested in the improvement of global welfare, and welfare with a Rawlsian tilt toward a stress on the reduction of poverty. Drawing on Esping-Andersen (1990, 1999), they see such "welfare" to be a product of the market (especially labor market) economy, the family and the state, and they accordingly adopt Esping-Andersen's stress on welfare state regimes. However, they also see human welfare as a result of community. This they see as being both formal and informal, public (statist) and private sector, anarchic and orderly. Armed with these new distinctions, Gough and Wood et al. elaborate on Esping-Andersen's welfare state regime typology, adding two additional welfare regime categories-informal regimes and "in/security regimes"-to the conventional social democratic, conservative, and liberal types.
For Wood, informal regimes reflect a condition where people rely upon community, upon "community and family relationships," to meet their security needs. Both types of relationships are usually "hierarchical and asymmetrical," and both use the lure of fragile, short-term welfare provision to ensnare people into patron-client relationships (50-52). Although increasingly rare as sole providers of welfare for any population, informal welfare regimes mix with welfare states to produce a hybrid informal-statist welfare regime. This conceptualization breaks down further when considered in specific contexts: conservative-informal and liberal-informal welfare regimes found in Latin America and parts of Asia (Bangladesh), as well as the productivist regimes of East Asia. In Latin America, for instance, the family seems to both corrupt the Bismarckian model of social insurance and undercut the liberal model, particularly when subjected to global pressure. Welfare systems of a post-colonial Anglo pedigree resemble corrupted "liberal" welfare states or "in/security" regimes.
In/security regimes "arise in areas of the world where powerful external players interact with weak actors to generate conflict and political instability." In them the "unpredictable environment undermines stable patterns of clientelism and informal rights within communities, and it can destroy household coping mechanisms. In the face of local warlords and other anarchic or repressive actors, governments cannot play even a vestigial governance and security-enhancing role. The result is a vicious cycle of insecurity, vulnerability, and suffering for all but small elite and their enforcers and clients" (Gough and Wood et al., 34). In her chapter, Philippa Bevan develops this model further focusing on sub-Saharan Africa.
All welfare regimes today are confronted with influential transnational environments and thus questionable futures. Chroniclers and analysts of formal welfare states especially single out problems of globalization. In particular, scholars have asked of these states: Do demographic and global pressures auger ill for the advancement or even maintenance of welfare levels under current welfare state regimes?
Razin and Sadka (2005) address this question for the European Union and the United States, essentially the world or rich democracies. Glatzer and Rueschemeyer and their contributors ask this question of middle-income countries such as those of Iberia and Latin America, the post-Soviet world and East Asia, as well as of the very advanced welfare states of Northwestern Europe. Gough and Wood et al. not only range over Latin America and both sluggish Asian developers (Bangladesh) and Tigers (South Korea), they also offer possible lessons that might be learned from the EU for the ordering of transnational forces in the shaping of human welfare.
In
On its face, this trend would seem to necessitate higher tax burdens and greater public debt to maintain national pension performance at current levels. Low-skill labor migration is also expected to place additional strain on welfare state financing because such workers tend to receive benefits that exceed their contributions to taxes. Empirical as well as theoretical support is found for the possibility that higher capital taxation could potentially finance burgeoning welfare expenses at current benefits levels. However, the theoretical modeling of Razin and Sadka (2005) indicates that international tax competition brought about by the globalization of capital markets will render the success of such a tax strategy unlikely. Moreover, political pressure from both aging and migrant populations is argued to generate political processes that favor trimming rather than expanding the welfare state. Thus, if empirically grounded hopes are raised for means to sustain (pay-as-you-go, national public) pension performance in the face of inexorable pressures on pension expenses, these are squashed by the authors' conclusions about voting and tax competition. Razin and Sadka (2005) suggest that some compensation for falling public pension quality may come from the privatization of pensions, although they make little attempt to comprehensively consider the complications of privatization schemes.
The latest in retrospective evidence from affluent democracies suggests that collectivist institutionalizations of interests and associated policy innovations have in fact buffered many European states against large cuts in welfare benefits and effective tax rates (see Swank and Steinmo 2002). In his contribution to Glatzer and Rueschemeyer, John Stephens offers an instructive case for the sufficiency of current Scandinavian socioeconomic policies with support for dual parent employment and productivist/welfarist policies more generally. Still, he is cautious when it comes to conservative welfare states given their inefficient payroll taxes and their waste of female production capabilities. Moreover, nothing in the literature on affluent democratic welfare states that is relatively optimistic about sustaining current welfare-state levels of income security offers much to counter the long-term pessimism of Razin and Sadka. Interestingly, Gough and Wood et al. see the domestication of class politics-"democratic class struggle" by "interclass settlements"-within the context of "relatively autonomous states" to be the foundation of those advanced welfare state which appear to be weathering globalization (312-314). This makes good sense as the "risk classes" (Baldwin 1990) that are most central to welfare state politics and functions overlap with and gain key political support from popular social classes (Hicks 1999, 180).
Glatzer and Rueschemeyer and Gough and Wood et al. have a lot to offer regarding socioeconomic policy among middle-income countries outside of the old first world. We find optimism about some Asian Tigers, guarded pessimism about Latin America and post-Soviet Europe, and some though limited respite from utter gloom elsewhere. This, at least, is the case in so far as we rely on the major contributions to understanding welfare state issues in middle and low-income countries offered by the excellent edited volumes from Glatzer and Rueschemeyer, and Gough and Wood et al.
In a central contribution to Glatzer and Rueschemeyer's volume, Garrett and Nickersen provide a systematic statistical analysis of the causes of general government consumption and total central government spending in middle-income nations (which range from the nearly "high income" Czech Republic to the arguably not quite "poor" Botswana). They find that the scale of the nonworking (dependent) portion of the population, the level of gross domestic product and capital integration in terms of foreign direct investment (FDI), and financial capital mobility are strongly related to general government spending. Yet only capital integration, recent democratic transition, and oil exports boosted central spending. Perhaps most interestingly, increases in capital integration sometimes tended to reduce growth in state spending in these middle-income nations, although the pattern is complex. FDI appears to have strongly boosted growth in government consumption in both poorly and well-integrated democracies. Capital mobility has tended to limit growth in government consumption in unintegrated autocracies, and to dampen such consumption in integrated ones.
Glatzer and Rueschemeyer's own summary of findings from their volume for middle-income nations and high-income welfare states-somewhat further distilled by me into nine points-is perhaps more illuminating than any extant statistical analysis. One, global market integration is new and unsuccessful in middle-income states (prolonged and successful in the case of advanced, high-income ones). Two, international trade and fiscal policy are structurally dependent on external forces and subject to international financial institutions' (IFI) policy demands of middle-income welfare states, and more autonomous and "orthodox" for advanced high-income states. Three, higher levels of ideological and financial dependence on foreign states and IFIs are problematic for middle-income states, but less so for high-income ones. Four, a relatively low-skill, low-wage, low-productivity labor force composition and intense international economic competition characterize middle-income states. Five, an anti-welfarist balance of class and political forces characterizes middle-income states. Six, problems of democratic functioning and autocratic legacies (or persistence) characterize middle-income states. Seven, limited although unsustainably high welfare legacies that are confined to segmented beneficiary constituencies and aggravated by nondemocratic precedents mark middle-income states, while more democratic, universalistic, sustainable welfare legacies characterize advanced high-income democracies. Eight, immoderately low or high welfare expectations destabilize middle-income states, while "naturalized" realistic views of welfare states backed by whole panoplies of institutions are typical in high-income welfare states. Nine, weak domestic state capacities for implementation, innovation, and adaptation of policies mark middle-income states, in contrast to the more capable states of high-income countries.
Countries in Latin America seem an especially good fit to these generalizations. Indeed, Evelyne Huber's chapter on Latin America substantiates most of these generalizations, although it especially supports contentions about unsuccessful market integration, debt-related subjugation to IMF policy demands, problems of democratic functioning, unsustainably high welfare legacies confined to segmented beneficiary constituencies, weak domestic state capacities, and dependence on foreign states and IFIs. Barrientos, in his contribution to Gough and Wood et al., echoes Huber but fits the process of Latin American welfare state retrenchment and development into the framework of a transition from a conservative-informal regime to liberal-informal ones. By doing so, Barrientos works his transition framework into the Gough and Wood et al. framework wherein informal clientelistic relations remain important during the Bismarckian and libertarian phases of state formation, in private corporations as well as polity (i.e., financial and corporate cronyism), and in the functions of family and community (i.e., subsistence support from family and
According to Glatzer and Rueschemeyer, major post-Soviet and post-Soviet Bloc societies (PSPSBS) share a lot with the Latin American examples. In particular, they share a legacy of wide ranging universalistic social benefits, correspondingly high welfare expectations and, at least, moderate state capacities with pro-welfarist forces. Still, they are arrayed along a continuum spanning, on the one hand, the relatively high-skill, economically integrated societies with some relevant democratic legacies (such as Czechoslovakia) to, on the other hand, societies like Russia. In the formulation of Gough and Wood et al., the PSPSBS societies seem to gravitate toward either liberal-informal models with some social democratic amenities like those of post "old" Labour Britain or conservative-informal regimes with contrary traits that approximate conservative-informal regimes, albeit relatively autonomous, economically independent variants of these in comparison with Latin America. However, the informal portion of this characterization is probably weak relative to the Latin American cases because of weak community, weak family elements, and the complexities of formal bureaucratic organization, enmeshed in the webs of informal social networks that have and continue to spread clientelistic ills.
Resembling the high-income welfare state yet providing some innovations of their own are the welfare states of East Asia, and of South Korea in particular. In these cases, informal and often patron/client-like relations in both family and state were prominent bases of social security. However, beginning in the 1960s, South Korea began to construct an extensive social insurance state. By the 1990s national health, pension, and occupational insurance programs (complemented by public assistance ones for the poorer and less well situated) had been implemented in South Korea as well as in Thailand (Gough et al. 2004, 174-175) Retirement, occupational, and health care for the elderly were also in place by the 1990s in the Philippines.
Complementing these East Asian social insurance/assistance states, South Korea being the prime example, are universalistic and quality public education systems and accomplished state systems for assisting private production, which in turn set limits on and the direction for welfare efforts. For Ian Holliday (2000) this package of programs warrants the term "productivist" welfare state. Despite occupational insurance, mere provident funds for retirees and public assistance for the ill leave Malaysia and Indonesia with porous social safety nets, and despite some impressive educational accomplishments, Malaysia is left at the margins of the East Asian productivist system. With few such accomplishments, Indonesia also falls short of Holliday's productivist epithet.
Moving the analysis beyond middle- and high-income countries, the greatest concentration of very poor nations is found in sub-Saharan Africa, among what Bevan (2004, 88-188) characterizes as "in/security systems." Here, one must go quickly beyond
Room's (2004) chapter joins Wood and Gough et al.'s stress on transnational and global levels of analysis with a discussion of multitiered international welfare systems, such as those found in the EU and expected among its prospective imitators. The EU take-off point is conceptualized as rule-based, helping set and enforce policy standards. Here we have a system that helps EU nations harmonize policies. The multitiered international welfare system found among EU nations is also viewed, by shifting from a system of voluntary association toward one of mutually self-binding governance, as an example of collective management as well as rules, a system that can construct and maintain a kind of embedded neoliberalism that harmonizes and moderates, as well as extend international economic transactions. It articulates and polices policy targets, shared standards and subsidies, and member aid, and as such, it is a system that embeds processes of policy learning while developing institutional arrangements for shared governance.
Arrayed against the hoped-for development of multitiered transnational welfare systems, even of a single multitiered global system, are both the disorganized character of the in/security regimes and the related global developments that are entailed by the concept of in/security systems. One is the increasing power of transnational capital rooted in increased "exit" options. A second is the ever-strengthening voice of the most powerful states, as well as of the international organization system. Countering these, at least for Room, Wood, and Gough, is the example of the EU, in so far as the European model can be applied as a relevant example to the developing world.
Class solidarities and cross-class political coalitions existing alongside strong states have contributed to the development of advanced welfare state regimes. Advanced welfare states have, in turn, given rise to multitiered welfare systems. In light of these histories of extant high-income welfare states, the global prospects for new multitiered systems explored by Room, Wood, and Gough may prove fanciful. There is insufficient space here to give justice to these new multitiered proposals. However, the Gough and Wood et al. volume does provide a compelling case of nation-state failings beyond the richest nations. It also provides a stimulating generalization of EU successes. In light of these contributions, the case for multitiered welfare definitely merits ample further consideration.