The Routledge International Handbook to Welfare State Systems

Christian Aspalter

• Publisher: Routledge
• Year: 2017
• Print ISBN: 9781472449306
• eBook ISBN: 9781317041078
• Edition: 1
• Topic: Social Sciences
• Subtopic: Social Work
• Index: Social Sciences

Developing countries may not have full-fledged welfare states like those we find in Europe, but certainly they have welfare state systems. For comparative social policy research the term "welfare state systems" has many advantages, as there are numerous different types/models of welfare state systems around the world. This path-breaking book, edited by Christian Aspalter, brings together leading experts to discuss social policy in 25 countries/regions around the world. From the most advanced welfare state systems in Scandinavia and Western Central Europe to the developing powers of Brazil, China, India, Russia, Mexico and Indonesia, each country-specific chapter provides a historical overview, discusses major characteristics of the welfare state system, analyzes country-specific problems, as well as critical current and future trends for further discussions, while also providing one additional major focal point/issue for greater in-depth analysis.

This book breaks new ground in ideal-typical welfare regime theory, identifying now in total 10 worlds of welfare capitalism. It provides broad perspectives on critical challenges which welfare state systems in the developing and developed world alike must address now and in the future. It will be of great interest to all scholars and students of social policy, social development, development and health economists, public policy, health policy, sociology, social work and social policy makers and administrators. This book is a reference book for researchers and social policy administrators; it can also serve as a textbook for courses on comparative social policy, international social policy and international social development.

1

Introduction

Christian Aspalter

The world of today is particularly exposed to new developments, locally and globally. The problems of the 20th century have not been solved yet, for example gender and ethnic discrimination and particularly, through the workings of dual welfare state systems (see Sainsbury, 1993, 1999; Dixon and Scheurell, 1994; Hobson, 1994; Pascall, 2008). Already there are new challenges unraveling the economic and social fabric of developed welfare state systems, such as long-term massive unemployment, ever-increasing poverty and social exclusion, lack of societal fertility and now massive waves of immigration across continents.

Newly developing welfare state systems have managed, however, to silently rise and put their mark on global social policy. Brazil, China, India and Indonesia are fast-rising pioneers (and not just copying welfare state institutions of the West) in global social policy. Conditional cash transfer (CCT) systems saw the light of day in Brazil. China now has universal coverage in terms of rudimentary health insurance and soon universal coverage in terms of minimum pensions in the country – with the largest population on earth. India is focusing instead on the human right to food, the human right to work and the human right to basic (i.e. necessary) medicines, which are provided for free, universally, in all corners and remote areas of the country. And Indonesia, too, after some time of difficulties of getting the political will together and some additional time to implementing social policies and programs, now at a much faster speed, shows a rather great and promising future in social policy, advancing its own welfare state system, ahead of the onset of an aging society (see Walker and Aspalter, 2015).

It was high time, hence, to roll up the sleeves and investigate the state of social policy and that of welfare state systems in all parts of the world, as much as possible, within the limitations of space of a single volume. This volume also envisions to be critical and, if possible, help break the silence about continuously globally rampant social injustices, different forms of discrimination and social exclusion, unwarranted poverty, hunger, illness and deaths on an unimaginable scale across the globe, as well as about failed or missing social policies that could mitigate or prevent such problems altogether.

The main weapon against all this is and should be science, the science provided by the academic discipline of social policy. Only through empirical research, proper theoretical understanding of empirical realities and professional evaluations in the field of normative – and necessarily comparative – social policy, can one start to guide governments and intergovernmental organizations to start doing the right thing, that is, to start implementing better-working strategies and to avoiding counterproductive programs, policies and social security system designs.

The contributors to this volume hope to have provided a bit better understanding of what is going on in the world of social policy, in all of the world.

The structure of the volume is straightforward. After the introduction, there are two chapters that both compare welfare state systems around the world and look into the future of those welfare state systems, but from very different angles. Then comes the succession of country case studies from around the world (following a more or less circular motion), all of which investigate the general traits and main features of welfare state systems, as well as past, current and future trends. Each focuses on a special topic in addition, to enable better learning and comparing across not only international borders, but also and especially across all continents – which is indeed a very rare feature in the international comparative welfare state literature.

Chapter 2 by Christian Aspalter is applying the ideal-typical welfare regime approach – the methodology for which was developed by German sociologist Max Weber – which is applied by the famous 1990 book by Gøsta Esping-Andersen. Due to the global nature of this book and new developments of applying ideal-typical welfare regime focus outside of the traditional European welfare state context, Aspalter for the first time here has extended the reach of ideal-typical welfare regime analysis to apply it to other parts of the world, not just Europe, East Asia and Latin America (Aspalter, 2006, 2011; see also Aspalter, Kim and Park, 2009), arriving at least at 10 different worlds of welfare capitalism or ideal-typical welfare regimes (models) – and hinting at more yet to be identified, perhaps, in future.

In the second part of this chapter, Aspalter looks at the importance of understanding and evaluating different major system designs and choices in setting up and running social security systems (including social assistance systems). It is of utmost importance to distinguish the very good and good social policy solutions from the ones that are not good enough or not good at all. For this purpose, Aspalter introduces the normative theory of Developmental Social Policy (DSP), which points out clearly the positive and negative choices of policies and system designs in providing social security and welfare benefits and services to the people all over the world.

As both approaches are needed, the ideal-typical and real-typical methods in comparative welfare state analysis (Aspalter, 2012a), Peter Abrahamson in Chapter 3 throws in his global, first-hand experience on welfare state systems around the world and his long-standing expertise in the welfare modeling business (Abrahamson, 1999) to analyze past and current developments of welfare state systems from around the world, region by region, by applying a real-typical welfare regime perspective, and then to make projections into the future of his own. While Aspalter (Chapter 2) believes (due to ongoing aging and fiscal austerity of welfare state systems, etc.) that the face and inner workings of the future welfare state systems down the road of the 21st century (much further down the road, 2050 and beyond, or perhaps earlier) will change in that new system solutions and system designs and policy strategies are to dominate – side by side with successful old solutions – designs and strategies of future welfare state systems, Abrahamson holds on to a European conviction that the welfare state of today will also be the welfare state of the future, and that changes will be minor rather than larger.

The Australian welfare state system, the first case study of this book (Chapter 4), is investigated by Philip Mendes. Australia always was and still is a strong outlier in the family of neoliberal welfare regimes (even from an ideal-typical perspective). Mendes excellently works through and explains the inner workings and program choices of the Australian welfare state system, which is based on the principle of (paternal) control of the government and its street-level agencies and the principle of punishment and blame for being poor or unsuccessful (economically, that is) and which is executed in a rather meticulously state-managed (bureaucratic and paternalistic) manner (see Howard, 2003). Australia is a particular case in point for the inner works and overall results of AMT welfare benefits and services, which in the long run increase poverty due to the inbuilt mechanisms of poverty trap and savings trap (see Midgley and Aspalter, 2016).

The second country study is conducted by Peter Abrahamson in Chapter 5, investigating the special characteristics of the American welfare state system, which is by and large modeled on the English Poor Law tradition and featuring a number of asset- and means-tested social assistance programs (AMTs), some of which are among the largest in the world. This contributes to the fact that America is among the largest spenders on welfare globally speaking (especially when also considering private welfare expenditure). AMTs, apart from state subsidies to social security pensions and the largest tax welfare state in the world for the middle and upper classes in particular (see Feldstein and Liebman, 2002; Howard, 1993, 1999), are the cause for a massive welfare state system in the US. Also, in terms of public health care spending in US dollars (PPP) per person per year, the US has been ranked among the top three countries in the world (see Aspalter, 2014), with only Luxembourg and Norway “outperforming” the American welfare state system in absolute terms (Aspalter, 2012b).

The US welfare state system is a very economically inefficient welfare state system. It is in fact the most inefficient welfare state system in the world due to a mix of super-heavy expenditures on AMTs and a large regulation-heavy mandatory private social insurance system, the so-called Affordable Care Act (ACA) or Obamacare, that supports and generates the greatest levels of profits for especially the private finance/insurance industry, the pharmaceutical industry, the hospital industry and law firms alike.

The super-heavy reliance on AMTs discriminates – with its poverty-trapping effects, especially “savings trap” and “poverty trap” (see Midgley and Aspalter, 2016) – against women and ethnic minorities that find themselves on the vulnerable side of the formal labor market. Hence, the welfare state system in the US is also one of the most gender and minority discriminating welfare state systems in the world, besides Australia, for example (see Baldry and Green, 2003; Abramovitz, 1996; Mitchell, 1997; Kingfisher, 2002, 1996; Goldsmith and Kingfisher, 2003; Scheurell, 2003).

The Cuban case study is provided by Carmelo Mesa-Lago (Chapter 6), who builds on experience over many decades on all major welfare state systems in Latin America and the Caribbean. Pointing out the uniqueness of the Cuban welfare state system in the region, Mesa-Lago advises greater play of private (especially church) agencies in welfare delivery to be able to cope with the great overall demand for welfare services. He also worries a great deal about the financial sustainability of the universal welfare state system of Cuba under the currently available economic and public resources, which may or may not be relieved substantially after the further ongoing lifting of economic sanctions imposed by the US under the current Obama administration. Even though with all the disadvantages the current communist, non-market economy of Cuba brings with it, the universal welfare state system in place does actually very well, in objective terms; for example, Cuba has consistently achieved significantly lower infant mortality rates and under-5 mortality rates than its giant, industrial, lead capitalist neighbor, the US (Aspalter, 2017).

Gabriel Martínez, in Chapter 7, shows that the Mexican government is aiming at more universalism in these coming years, while having developed at the moment a welfare state system that is still heavily relying on a particular type of AMT conditional cash transfer (CCT) system. The CCT system of Mexico (apart from being essentially also based on AMT) also shows good elements, especially the perspectives of a new social policy strategy applied that change people’s behaviors, trying to build families’ human capabilities (that is, human capital, see e.g. Midgley and Aspalter, 2016), particularly in education and health care aspects. Like in most other Latin American countries, there is a great gap between people covered by social insurance systems that are usually heavily subsidized by the government, and the poor people, who are made to rely on dependency reinforcing AMT-based social welfare benefits and services (see Aspalter, 2011). According to Martínez, half of the population is covered by formal social security systems (social insurance), and those who are mainly working in the informal sector account for the other half. Recent efforts by the Mexican government to reduce the share of people working in the informal sector have been without any significant success.

Taking on another key Latin American welfare state system, Silvia Borzutzky and Mark Hyde (in Chapter 8), discuss in full length the case of the Chilean welfare state system. Borzutzky and Hyde make it clear that in the case of privately run provident fund systems (PFS), as in the case of the Chilean old-age pension accounts, profits are high for private companies who run PFS, but return on investment for the members of these systems, for this very reason, are very low (see also Borzutzky, 2002a, 2002b). Hence, state-run PFS are a much better choice, as they avoid high administrative fees and profit-taking from companies.

In the Chilean health care sector, old inequalities have been exchanged with new ones, depending largely on the type of diseases being covered or not. Chilean social policy development is, in short, torn between efforts to neoliberalize social policy, and efforts to support public well-being and with it the social rights of Chilean citizens, recent change in presidents, and the peculiar mix of social policies applied over the past decades are paramount to this special characteristic of the Chilean welfare state system.

The last of the big Latin American welfare state systems covered by this book is presented by Christian Aspalter in Chapter 9. Against the belief of some foreign observers that Brazil has developed a strong or any kind of significant universal welfare state system, Aspalter confirms vehemently that despite some success in terms of universal health care delivery, generally the opposite is the case. The Brazilian welfare state system is, so says Aspalter and some other local and foreign analysts (such as Novy, 2001; Suter and Budowski, 2001; Farias, 2003), heavily regressive in terms of redistribution, particularly due to its emphasis on state subsidies for pension systems, and especially for public servants. The dominant conditional cash transfer system in place is means-tested and hence designed to keep the poor people in place, in terms of their submission to economic destitution, due to the workings of the “poverty trap” and the “savings trap” that are caused by any AMT social assistance or social service program (see e.g. Aspalter, 2016a; Midgley and Aspalter, 2016). Only 0.5 percent of the country’s GDP, hence, goes into this form of welfare state program in Brazil, enough to get credit in local and national elections, and by far not enough to lift the poor people of Brazil out of poverty, while also helping to lock the poor up in poverty (perpetually). A solution here is very simple: take out any AMT element (also all quasi-means-tests) and replace them entirely with (1) non-economically targeting (NET), such as based on poverty maps (i.e. geographic targeting) and/or household targeting, and so forth; and/or (2) universal benefits and services (UBS).

Going into the heart of Africa, Chapter 10 by Bruce Josephson discusses problems that are key for any understanding of most African welfare state systems that face not only technical, financial and administrative difficulties, but even more so, a context of widespread violence, even war and terrorism, and political disintegration, hyper-fast population increase and socio-economic inequalities across their nation state. Josephson suggests that Nigeria has to deal with dire corruption, and then possibly extending the coverage of the social security system in terms of the population covered, and at the same time build and increase some kind of redistributive social security system (see Dostal, 2010). In Nigeria, like in most African countries, the government officers are taking the bulk of the country’s wealth for themselves, and in this way prohibit any meaningful start-up or kick-off of social and economic development for the rest of the population.

Chapter 11, written by Paul Taylor and Jason Powell, investigates the case of the UK, with particular reference also to the mental health care situation there. With all the attempted privatization policies of the last 20 years, the UK’s welfare state system has been to a large extent “hollowed out,” as they write. The National Health Service also suffered greatly during the years of the Labour government under Tony Blair, ever since the late 1990s (see Aspalter, Uchida and Gauld, 2012). There is, however, also good news from social policy making in the UK, where there is a marked new focus on financial incentives and a new orientation towards outputs and successes (instead of expenditure and utilization patterns) (see Midgley and Aspalter, 2016). For the UK, and for the developed (and developing) world as a whole, we need to refocus on what a social investment state really is (see e.g. Abrahamson, 2010; Keersbergen and Hemerijck, 2012). This chapter lays important groundwork towards that direction, particularly by focusing on investment in mental health of the population and its causal connections to poverty.

In Chapter 12, Joakim Palme delivers a full-fledged insight into the Swedish welfare state system. The Swedish welfare state system is built on the premise that if the middle classes are fully integrated into the welfare state programs and columns, then they will fully support the very same, also by paying ...

Table of contents

• Cover
• Title
• Copyright
• Dedication
• Contents
• List of tables and figures
• Notes on contributors
• Foreword
• Preface
• 1 Introduction
• 2 Ten worlds of welfare capitalism: an ideal-typical perspective
• 3 Future welfare: an uneven race to the top and/or a polarized world?
• 4 The Australian welfare state system: with special reference to welfare conditionality – the case of the income management system
• 5 The American welfare state system: with special reference to asset- and means-tested social assistance programs
• 6 The Cuban welfare state system: with special reference to universalism
• 7 The Mexican welfare state system: with special reference to conditional cash transfer systems
• 8 The Chilean welfare state system: with special reference to social security privatization
• 9 The Brazilian welfare state system: with special reference to the outcomes and performance of the welfare state system
• 10 The Nigerian welfare state system: with special reference to the challenges of developing a social security system
• 11 The UK welfare state system: with special reference to the mental health care system
• 12 The Swedish welfare state system: with special reference to inequality and the redistribution paradox
• 13 The French welfare state system: with special reference to youth unemployment
• 14 The Belgian welfare state system: with special reference to “targeting within universalism”
• 15 The German welfare state system: with special reference to the old-age pension system
• 16 The Austrian welfare state system: with special reference to the long-term care system
• 17 The Swiss welfare state system: with special reference to education policy
• 18 The Russian welfare state system: with special reference to regional inequality
• 19 The Turkish welfare state system: with special reference to human capital development
• 20 The Israeli welfare state system: with special reference to social inclusion
• 21 The Indian welfare state system: with special reference to social policy and the burden of disease
• 22 The Indonesian welfare state system: with special reference to social security extension in the development context
• 23 The Singaporean welfare state system: with special reference to public housing and the Central Provident Fund
• 24 The Chinese welfare state system: with special reference to aging of society and social policy
• 25 The Hong Kong welfare state system: with special reference to new initiatives in social assistance provision
• 26 The Taiwanese welfare state system: with special reference to its universal health insurance system
• 27 The South Korean welfare state system: with special reference to the future of social insurance systems
• 28 The Japanese welfare state system: with special reference to financing health care, pensions and long-term care in a super-aged society
• 29 Lessons from around the world: by way of conclusion
• Index