Wednesday, August 18, 2004

Welfare, Left and Right

In my opinion, Just Left is writing some of the most important stuff in the New Zealand blogosphere at the moment. His latest entry is a coming to grips with questions posed by Colin James about the kinds of presuppositions that different political perspectives bring to welfare and welfare policy. Unfortunately, Colin James’ article, like much of his recent writing, is nearly irrelevant in its mushiness and dwells on ground that has been covered over and over again: moral differences deployed by the left and right in the field of welfare policy seem to have lost their traditional definition. It's typical of the wise triumphalism that many right-of-centre commentators have indulged in since the demise of the USSR. Though it is, perhaps, a little out of date.

Listen to statements like these:

…the left focuses much more on the horror childhood than on ownership of misdeeds and redemption. It reaches for state instruments to wash away the sins and create a new life. But this presumes the state can change the inner person, without which there is no absolution and renewal. The state can do that only incidentally through individual action by gifted or insightful state servants and teachers, not through systems.
Excuse me? Let's leave aside the obscurity of 'absolution and renewal' for a moment. It is the welfare state that puts systems like schools and social workers in place to ensure that gifted and insightful state servants and teachers have the opportunity to interact with the people who need help. And while it may be true that there has been a lack of moral definition between left and right in the last several decades, it’s a mistake to think that this process has only worked one way: that only those on the left have migrated to wiser moral climes. The politics of the welfare state have not left conservatism and the right unaffected. And in a very real sense, the welfare state itself has provided the political and social basis of right-wing and liberal economic activity, even if this connection has not always been explicitly stated in the writings of analysts like James. Seeing this point clearly helps us to think about the politics of the welfare state in a more nuanced way.

A good example of the right travelling to the traditional moral ground of the left is the recent emphasis on early childhood education and intervention. For years, conservative and right-wing social policy directed at children had held parents and their moral life as ultimately responsible for the success (or otherwise) the child. But in the last few years, studies and policy work have shown that life chances of children improve significantly if there are systems put in place to help parents with the work of parenting. Early childhood education programmes, parental education and support programmes are commonplace now and importantly enjoy widespread support.

But for James, the welfare state is all about welfare. About benefits for bludgers. There is an odd anachrony in James' writing, as though he had accidentally cut and pasted something from an article written years ago. Implying gently that the left is responsible for growing welfare rolls, James writes:

What is not commonsense is to palliate ever-growing welfare rolls. That is not sustainable, fiscally or politically. The left is beginning to grasp this but has not yet worked out what to do. If it doesn't, one day its core supporters will desert it for politicians who say they can.
Now, I don’t know if James has actually been paying attention to economic indicators lately, but it seems clear to me that the left has grasped this for some time, and they have indeed worked out what to do. It’s true that, due to the Lange government’s reforms, Labour in New Zealand took some time to get to the same place as Blair in Britain or the various social-democratic regimes in Europe, for example. It took the clear break of Helen Clark and Michael Cullen for New Zealand Labour to finally dispense with the political and economic disaster that was Lange. But let me spell it out: those who James would define as left have been focussing on economic growth and low unemployment. And they have been using the welfare state to do it.

This would seem to fly in the face of much conventional punditry these days. After all, hasn’t the welfare state been fatefully undermined by neo-liberalism and globalisation? Listen to Ulrich Beck:

The premises of the welfare state and pension system, of income support, local government and infrastructural policies, the power of organised labour, industry-wide free collective bargaining, state expenditure, the fiscal system and ‘fair taxation’ – all this melts under the withering sun of globalisation and becomes susceptible to (demands for) political moulding. Every social actor must respond in some way or another; and the typical responses do not fit into the old left-right schema of political action
Dire stuff. But Beck seems unable to swallow his own medicine about the mutability of left-right distinctions. More specifically, he makes the mistake of seeing the mechanisms of the welfare state solely as creations of the left. Arguments about the end of left-right politics are always posed in the context of the vanishing welfare state and the irresistable power of globalisation. The assumption is that the welfare state has nothing to do with free markets and global capital. It ignores the role that the welfare state has played in the development of modern capitalism, and in the development of globalisation itself. Other theorists are more careful. In his article Global Markets and National Politics, Geoffrey Garrett writes that

…in a world of capital mobility, there is still a virtuous circle between activist government and international openness. The government interventions emblematic of the modern welfare state provide buffers against the kinds of social and political backlashes that undermined openness in the first half of the twentieth century – protectionism, nationalism, and international conflict.
Citing the work of Polanyi and J.G. Ruggie, Garrett argues that the welfare state compromise really was a compromise, in that the mechanisms of the welfare state helped to embed economic liberalism. For too long we have seen only one side of the deal and have failed to recognise the extent to which the welfare state supported the development of open international trade and economic liberalism. The failure to see the double-sided nature of the welfare state can lead to a politics of nostalgia best seen in the work of Bruce Jesson and Jane Kelsey.

Garrett writes:
…the embedded liberalism compromise of the Bretton Woods period combined an international regime of trade openness, fixed exchange rates and capital controls with the domestic political economy of the Keynesian welfare state. The final observation that should be made about this combination is that many analysts believe that embedded liberalism was most prominent and worked best in countries characterised by strong and centralised (corporatist) labour movements and powerful social democratic parties. Centre-left parties are more likely to be sensitive to the political demands of short-term market losers. Corporatist labour movements have incentives to tailor wage growth to benefit the economy as a whole…
Now that’s not a story you read too often.