Re-building America’s Welfare State

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Presidential elections focus our attention on the current parameters of political conversation, which doesn’t suit the left particularly well. How much does Obama differ from Romney on abortion (a lot), the safety net (a lot, with disquieting wiggle room), or drone strikes (not at all).

But considering the current state of the Democratic Party, which is less committed to economic justice than it used to be, there is a lot of space on the left that goes unexplored. Polls show that no one likes the idea of raising the retirement age: Cutting Social Security and Medicare are both widely unpopularClass War?: What Americans Really Think about Economic Inequality, a quick little read, shows that polls have consistently found that Americans across the political spectrum favor raising taxes on the wealthy to pay for more generous social spending. The Overton window hovers directly over higher taxes and an expanded safety net. But our elites are unresponsive.

In the most recent issue of In These Timesposted online this Monday, Bhaskar Sunkara and Peter Frase outline a vision far beyond what today’s Democratic Party proposes, a vision inline with the social democratic structures that have protected many European and East Asian nations from the rampant inequality, and its attendant social ills, that have been ravaging America for the last thirty years or more.

Sunkara and Frase suggest regional alliances are needed to push the federal government to expand its safety net funding. (Federalizing Medicaid, for example, is a great idea.)

Progressives can’t win by simply defending safety net programs from attack. We need to push to expand programs. The Affordable Care Act is a start, but we need a lot more to protect our citizens from the vicissitudes of the market. An excerpt from Sunkara and Frase’s piece below the fold. Discuss and organize.

You get what you pay for, and we haven’t paid for much.

Compared to other rich countries, the United States does little to ensure its citizens have access to vital services or to prevent them from falling into deprivation due to unemployment or low-wage labor. At 19.4 percent of GDP, American social spending is far below the 25 to 30 percent budgeted in most of Western Europe. Meanwhile, 16 percent of Americans lack health insurance, almost a quarter of our children live in poverty, and millions are unemployed.

Yet not only does an expansion of the safety net seem politically impossible, even existing protections are under attack everywhere.

This might seem like a poor moment to call for expanding the welfare state. But the timing has never been better. Austerity has only worsened unemployment and stagnated wages, and only a concerted effort to employ idle workers and boost purchasing power can revive growth and restore employment. Despite fear-mongering about the effects of budget deficits, the government is still able to borrow money virtually interest-free. And contrary to right-wing claims of out-of-control spending, taxes as a percentage of GDP are at their lowest level since 1950. We can, and should, ensure that everyone has access to healthcare, education, a secure retirement and a livable income, regardless of labor market uncertainties.

Most on the Left would agree with these goals—the question has always been how to achieve them.

We think we have an answer. We propose a new anti-austerity coalition united by the immediate demand that certain social spending burdens, currently borne by states and municipalities, be federalized. Almost all states are legally required to keep balanced budgets, making it unfeasible for them to employ deficit spending to address to a cyclical economic downturn. Even if these laws were changed, states would still face far more difficulties in this arena than the federal government. States could never borrow money on as favorable terms as the United States can, and they haven’t been printing their own currencies since the Articles of Confederation.

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