History 471
·
After the collapse of the capitalist economy in 1929, the
Roosevelt administration intervened to try to restore the system to health
o
Though he was often accused of being a socialist, FDR tried
to save capitalism, and was actually a fiscal conservative who continually
sought to have a balanced budget and pay-as-you-go programs. Whenever it seemed
that the private economy was pulling out of the doldrums, he attempted to scale
back government spending on public programs that reduced unemployment.
o
In addition, FDR
financed many of his programs with regressive taxation. For example, social
security funds, based on taxes on wages rather than income, initially paid for
work relief. There was a lot of rhetoric about the redistribution of wealth,
but New Deal social policy was based on attempts to restore business
confidence. In deference to this and fiscal concerns, FDR scaled back many
successful public works programs.
·
It was only with WWII that the Great Depression ended.
o
Massive amounts of government spending (deficit-spending) on
war production brought full-employment.
·
But what would happen after the war?
o
Labor Movement supported deficit spending on behalf of human
and social needs, much like European labor movements (which succeeded to a
greater degree)
Compare Europe: In Europe the idea of a
"welfare" state that undertook planning in order to guarantee certain
economic and social rights as a “right of citizenship” won wide acceptance after WWII.
·
In Europe during the postwar reconstruction, the idea that
capitalism couldn't survive without government intervention led to a specific
kind of government intervention. If democratic governments had to intervene to
save capitalism, government should at least ensure that the system provided for
everyone, not just for a select number or percentage of people. This notion is what is referred to as the
“social wage”—the idea that government should guarantee jobs if capitalism
didn’t provide them, that government should reduce the surplus labor supply
rather than driving down the social wage by ignoring or increasing the surplus
labor supply (the policy of governments in the era before the New Deal), that a
citizen couldn’t participate in the polity unless they had economic security
There was some reason to believe that U.S. politics could have gone in a similar direction:
o
Labor during the New Deal had been the major organizational
base for a politics directed toward the original vision of economist John Maynard Keynes: government
spending that was directed toward the needs of citizens and toward full
employment. Keynesianism is a term that
is associated with deficit spending. It is often forgotten that deficit
spending came from the realization that capitalism could not survive without
government support.
o
On the surface, this realization threatened to open up
politics to class considerations (see Fones-Wolf Reading)
·
FDR issued the Economic Bill of Rights in 1944 because of
workers’ activism and demands.
·
Most people never expected continued expansion of military,
so how would system be sustained?
·
Many people thought through government spending on social
needs, and through controls that would limit private control of the economy
Economic Bill of Rights: The right of a useful
job, right to earn enough to provide adequate food and clothing and recreation,
right of every farmer to raise and sell his products at a return which will
give him and his family a decent living; right of every businessman, large and
small, to trade in an atmosphere of freedom from unfair competition and
domination by monopolies at home or abroad; right of adequate medical care and the opportunity to achieve and enjoy
good health; right to adequate protection from the economic fears of old age,
sickness, accident and unemployment, right to a good education.
o
--Popular legislation, Murray-Kilgore bill, promised to
fulfill some of these newly-declared rights, and the labor movement seemed
powerful enough to mobilize people on behalf of them, if they could succeed in
organizing the south and breaking the power of conservative Democrats that
controlled politics in the south
·
But U.S. business planned worldwide expansion of markets in
the postwar era, and the end to domestic-based economy only, and sought to
contain labor-based drive for full-employment and expansion of universal
entitlements like health care. (Note:
The newly revived “American Century”
term, behind the current war in Iraq, originated in 1944. Time Magazine’s far-right minion,
Henry Luce, declared that the rest of the world would be developed on America’s
terms, and thus the rest of the century would be the “American century. (In
1997, the Project for the New American Century revived the term in their
planning for the Iraqi invasion and projection of U.S. world power)
o
In contrast to industrialized Europe, over the course of
1940s and 50s, U.S. witnessed opposition to universal social programs; campaigns by business blocked some; in other
cases, Southern Democrats joined Republicans in blocking any program that might
weaken white supremacy—thus Reconstruction era politics still affecting social
policy.
·
The Cold War, which began in 1946, helped to resolve the
“problem” of the threat of class politics– through military spending,
government could spend to sustain the economy without having to deal with
issues of redistribution of wealth that is the heart of notions of social wage.
·
Dreams of an economy organized to provide security was
replaced by an economy organized to sustain U.S. global power
·
A significant portion of the economy is directed toward
military spending rather than social spending with the dawn of the Cold War.
The Cold War bridged the interests of conservatives (who for example, refused
to spend for full-employment bill, but would spend on military preparedness)
with liberals who committed themselves to a worldwide fight against communism.
The combination was powerful.
·
Whereas in 1940 less than 16% of the federal budget was for
defense, by 1950 military spending takes up 50% of the budget, and by 1969, it
had grown to 56%.
·
U.S. News and World Report acknowledged
the role of government military spending in shoring up the economy when in 1950
they wrote: “Government planners figure that they have found the magic formula
for almost endless good times…the Cold War is an automatic pump primer” (Pump
priming refers to government spending when the economy seems to be in doldrums)
·
Cold War supposedly over, but affects us today in ways that go
unnoticed but are profound
·
has aided the militarization of U.S. and other economies across the globe; national
security assumed permanent and paramount importance in American life, so that
much of the nation’s treasury was devoted to it.
·
U.S. armed forces spread over much of the globe, and U.S.
science and industry were profoundly reoriented. War and national security
became consuming anxieties and provided the memories, models and metaphors that
shaped broad areas of national life.
·
Traditional view: U.S. thrust into
contention with Soviet Union, to counter Soviet aggression--Soviets determined
to conquer the world, bring Soviet-style socialism by force to the entire
planet
·
most historians understand that it was much more
complicated than this, and many have concluded that the U.S. bears much of
the responsibility for escalating the arms race and the “hot wars” in the third
world that took place during the cold war
B. George Kennan and the “secrets” of the National Security
State:
·
Containment of Soviet Union first announced as policy by
George Kennan in 1947; Kennan argued
that the policy would force the Soviet Union to collapse.
·
Kennan famous for this, but in 1948 he also articulated,
privately, another aspect of U.S. foreign policy as a member of the State
Department: (from “top secret” Policy Planning Study 23): (document declassified and revealed in 1984)
“We have about 50% of the
world’s wealth, but only 6.3% of its population...In this situation, we cannot
fail to be the object of envy and resentment. Our real task in the coming
period is to devise a pattern of relationships which will permit us to maintain
this position of disparity...To do so, we will have to dispense with all
sentimentality and day-dreaming; and our attention will have to be concentrated
everywhere on our immediate national objectives...We should cease to talk about
vague and ...unreal objectives such as human rights, the raising of living
standards, and democratization. The day is not far off when we are going to
have to deal in straight power concepts. The less we are then hampered by
idealistic slogans, the better.”
·
need to recognize
that agenda of U.S. was bound up with an ideological commitment to
expanding capitalism as well as
democracy across the globe, but also a continuation of U.S. involvement in
imperialist policies begun earlier in the century. In the case of the third
world, very little commitment to democracy is recognizable, as the U.S. helped
to overthrow democratic regimes and replace them with dictatorships that served
U.S. interests
Need to acknowledge that the
U.S. had expansionist goals in postwar,
agenda regarding trade favorable to U.S. and to capitalism.
·
During war, these leading businessmen came to accept
government role in sustaining capitalist system, saw the benefits of
government. Feared collapse of capitalism if government was not used to support
it.
·
These businessmen dominated foreign policy after the war.
Felt that economic growth couldn’t take place without US government role
dominant at home and abroad.
·
Needed to expand
trade to sell surplus products abroad and get raw materials for great
industrial capacity of US built during war. By end of W.W.II US dependent on
imports for all important minerals except coal and oil.
·
These businessmen
feared the collapse of colonial empires built in the previous century by
European powers.
·
Urged an active government abroad with the aim of bolstering
trade and warding off the socialist and communist threat to the former colonial
empires as well as in Europe.
·
This was the context for the establishment of 1944 Bretton Woods meeting, where
business and government put together the workings of the postwar economy.
·
BW established the dollar as the basis of international
currency, established what would become the World Bank and International
Monetary Fund
·
--all structured on the basis of one dollar, one vote--since
US economy not devastated, had control of money, Assumed US business would
dominate in postwar.
·
WB and IMF would offer money on terms that would necessitate
development on US terms--not self-sufficient economies, but economies based on
trading with US.
·
Raw materials to
fuel US industries, and later establishment of industry on US terms too.
·
The unwritten goal of the WB and IMF--one that has been
enforced with a vengeance--has been to integrate countries into the capitalist
world economy
·
--Policies of WB and IMF are designed to facilitate the
repayment of debt: in the end this has resulted in the steady transfer of
wealth out of the Third World countries to the bankers and wealthy of
industrial countries--continuation of imperialist policies.
·
Role of U.S. government is to facilitate world trade with US
financial and corporate dominance secure.
·
It was not
the “invisible hand of the marketplace” that produced U.S. global dominance,
but government activities on behalf of business.
·
In the postwar, a new global order came into being.
U.S. was the dominant world power in the capitalist world, and acted as a kind
of “global policeman” for capitalism:
·
Bretton Woods agreement US controlled the value of money
across the globe. The dollar was pegged to gold. The International Monetary Fund and the World Bank began to
develop the third world on capitalist terms. Economic and military commitments
protected US business interest abroad. The US was able to dictate terms to
other countries that ensured it has access to raw materials and markets.
·
US corporate and bankers and government officials envisioned
its role as director of rebuilding Europe, in ways that helped expand and
sustain capitalist markets.
·
Postwar economic growth was built on low-cost energy, from a
steady supply of cheap oil from the third world, where US oil companies
interests were protected by US government foreign policy and even CIA secret
overthrow of governments.
·
U.S. corporations were able to pass along higher wage costs
to consumers because in many cases they were able to set their prices without
concern about competition.
·
US businesses did not vigorously contest government
intervention in the economy, and recognized some degree of social
responsibility that went with that intervention.
·
Major US corporations accepted an unprecedented degree of
unionization as long as unions didn’t interfere with management’s right to
direct their operations and make all production and investment decisions such
as plant location decisions, automation of operations, etc.
·
Overall workers benefited from increased productivity,
though corporations profits rose more than workers’ wages
·
The period 1945-1970 in world history had been notable
for corporations’ acceptance of social
responsibility and benefits, at least for a significant percentage of people.
However, when coupled with the non-universal nature of distribution of fruits
of the system, a significant portion of the American population did not share
in these benefits
·
In immediate postwar, cold war politics and politics of
anti-communism means growing conformity at home; US policy of spreading
capitalism abroad and at shoring up capitalist system at home has bi-partisan
support--helps to create "permanent war economy". This and other
government subsidization of growth through inequitable social programs ensures
that social inequality persists even in the midst of new "affluence"
·
In the immediate postwar era, labor was poised to push the
U.S. in the direction of universal social programs; Major “agent” of “class”
politics had been unions which originated in 1930s; class politics means
struggle over the distribution of wealth and power in society, the agenda to
re-make a society that was oriented toward ensuring equality of opportunity and
access to the resources of society
·
The Cold War helped to contain the labor movement because of
the domestic anticommunism that split the labor movement and caused it to be a
junior partner in the Democratic Party.
·
Anticommunism is
also a factor in the collapse of the attempt to organize the south,
which retains a political stronghold for the entire nation. Southern
politicians control a one-party system that results in a great degree of power
in both Democratic and Republican administrations, and the power of deal-making
shapes all of the possibilities of welfare state legislation.
·
Liberals reduced their ambitions for an expanded welfare
state that would guarantee the Economic Bill of Rights, and instead became
committed to the concept of “growth with equity”—growing the economy by
expanding capitalist markets domestically and abroad. Government would help the
capitalist economy grow and through that growth more social programs could be
added.
o
Liberals were committed to global capitalist expansion and
to gradual expansion of benefits that
both aided people in need and helped to stabilize the American economic and
social system.
o
By 1950 liberals didn’t object to the military spending and
indeed, many openly embraced it. Those who did question it were easily labeled
as “soft on communism.” Liberals identified with the goal of stopping communism
abroad. While they were dismayed by the ways that domestic anticommunism
undermined their commitment to the expansion of the welfare state, they continued
to agree to a large military budget which diminished the possibilities for that
expansion. As more and more of the GNP and the budget was committed to
military, this eroded the possibility of domestic spending that might address
capitalist inequities.
·
Taming Labor and political consensus over military policies
allow economy to grow in a direction that does not address inequality of wealth
A. Taming
Labor ----mass movement of labor that had been ignited during 30s
was a potential gigantic social movement for the postwar, and some unions had
visionary ideas about the postwar.
·
Most of the unions with visionary plans for the postwar
contain communists or homegrown radicals, and these are purged in the great
postwar "red scare"; radical possibilities of the labor movement,
that it might lead a movement for a new agenda, or even a new political party,
stopped by postwar anti-communism
·
Labor leaders eliminate 11 unions after these unions refuse
to endorse Democrat Harry Truman and after HUAC hearings (House Unamerican
Activities Committee)
·
Instead of social upheaval, unions organize and gain
benefits mostly for their own members as result of postwar contracts: negotiate
for higher wages/benefits for its members, but not to challenge business
decision making ("management rights") such as plant locations,
automation, etc);
·
Taft-Hartley contributed to this taming-see readings
B. US
policymakers find “growth politics” makes for political consensus
·
Class politics of Depression era had still been apparent in
immediate postwar
·
But US policymakers of both parties avoided class politics
like redistribution of wealth for politics of growth--growing the
economy to make the pie bigger so that they would not have to target wealthy
class; government would use spending policy to infuse the economy with
spending, as it had during WWII, but mostly for military and
"unassailable" expenditures for the middle class
C.
MILITARY AGENDA PROVIDES "SOLUTION" to bi-partisan (agreement by both
Democrats and Republicans) spending and growth politics
·
THE PRINCIPAL CONTRIBUTOR TO THE UNPRECEDENTED ECONOMIC
GROWTH IN GOVERNMENT SPENDING IN 1950S WAS MILITARY EXPENDITURES.
·
Whereas in 1940 only 15% of the fed budget had been devoted
to military, in 1959 military claimed more than 50%, by 1969, had grown to
56%.==more if you include veterans benefits in this category.
·
Military spending was a "solution" because it was
government subsidization of business that could be masked; here was a
"jobs program" that could be agreed upon by conservative southern
Democrats and western and Northern Congressmen, those political dealers who
opposed other types of social spending (such as housing and other jobs
programs); military installations and contractors located in the southern and
western states, and since in the south, the states could decide who got the
jobs, it was a way to have spending without redistributing income to the poor
blacks and poor whites.
--politically acceptable, indeed
unopposable, because it was military, not social spending. . not thought of as
welfare
·
Cold War spending gradually became geared to addressing
downturns of U.S. economy. Government expenditures for housing, health,
education and income maintenance were thought to cause class and group
conflict. But few dared to question the cost of defense.
·
channeling money into national security limited the
resources available for domestic social needs, all toward non-socially useful
products like nuclear weapons and bombers,etc.
The bulk of direct government
expenditures went to the creation of weapons of destruction
·
high levels of "defense spending" spurred sales
and employment but altered the nature of the economy
·
U.S. News and World Report suggested
(May 1950) that "government planners figure that they have found the
magic formula for almost endless good times...the Cold War is an automatic pump
primer"
§
Pump priming was term associated with John Maynard Keynes,
(economist) who had suggested that government should “prime the pump” of
capitalist economies by social spending, in order to save capitalism. The pump
would need priming whenever the economy went into a tailspin. When that
happened, he said, the government needed to spend, even go into deficit
spending, in order to keep the economy working. He recognized that capitalism couldn’t be sustained without
government spending. Keynes had thought that government should spend for social
needs. Now US News and World Report were suggesting that military
spending had taken the place of domestic spending as the “pump primer”
·
American corporations tied their fortunes to the ascending
military star--lobbied furiously for bigger Pentagon contracts--staffed their
hierarchies w/ unprecedented #s of military officers
·
The Defense Dept became practically a state within the
state.
· In 1968, the Pentagon alone contracted for
more than $44 billion of goods and services.
Gen.
Dynamics--leading defense contractor 1957-1960--186 retired officers in
Pentagon
·
reinforces economic dominance by large corporations in the
entire economy
·
largest companies get 2/3 of post-1951 military
spending--Defense-related industries and the scientists and engineers they
employed entered into a long term relationship with he federal government.;
·
70 of 91 defense
secys and undersecys, secys of 3 military services, directors of CIA from
1940-1960 from ranks of big business and finance
·
1958-military purchased 100% of nation's ordnance
production,94% of aircraft, 61% of ships and boats, 21% electronic equipment, 13% of primary metals; 1954 profits as % of net worth: 139% for
General Dynamics 93% Boeing ; 81% Douglas, etc.
Example of system: Boeing-
·
After the war, Fortune magazine explained "the aircraft
industry today cannot satisfactorily exist in a pure, uncompetitive,
unsubsidized "free enterprise" economy" and that the
"government is its only possible savior". The Pentagon system
sustained and expanded the industry along with steel and metals, etc. that went
into building the aircraft;
·
First Secretary of the Air Force, Stuart Symington, was the
industry's representative in Washington. He regularly demanded enough
procurement funds in the military budget to, as he put it, "meet the
requirements of the aircraft industry."; Symington, January 1948:
"the word to talk was not 'subsidy'; the word to talk was
'security.".
·
these developments called
the Military Industrial Complex--phrase
coined by Eisenhower--January 1961, before leaving office—warned of
the dangers to democracy of these relationships. U.S. had always reduced
military capacities after war, now a permanent military capacity and structure
might lead U.S. into future wars
·
Military spending and a disproportionate share of domestic
spending is directed toward the south and the west. The south and the west in
turn become a point of relocation for unionized northern and Midwestern
corporations, who begin to migrate to the non-union south and west starting in
the 1940s. This further erodes the power of unions in the Democratic Party.
V. POSTWAR
ORDER WAS GOVERNMENT-SUBSIDIZED PRIVATE PROFIT SYSTEM-
·
business-govt partnership--federal money underwrites costs
of much research
·
System
Demands Consumers and Spending-- American economy produces unprecedented
amount of things-, and postwar dynamics provide them;
·
1st, significant degree of unionization means most workers
are better off than ever before, with degree of security and benefits unknown
before
·
advertising assists
in trying to bring mass consumption to more than ever before--advertising rises
300% from 1946-1957
·
Postwar economic growth was built on low-cost energy, with
growing supply of cheap oil from the third world, where US oil companies
interests were protected by US government foreign policy and even CIA secret
overthrow of governments. Thus costs of this system hidden, in unassailable
military spending vs. gas pump prices (I would argue this continues to the
present time)
·
U.S. corporations were able to pass along higher wage costs to
consumers because in many cases they were able to set their prices without
concern about competition.
·
US businesses did not contest government intervention in the
economy, and recognized some degree of social responsibility that went with
that intervention.
·
Major US corporations accepted an unprecedented degree of
unionization as long as unions didn’t interfere with management’s right to
direct their operations and make all production and investment decisions such
as plant location decisions, automation of operations, etc.
·
US corporations granted workers a share of the growing
economic pie.
·
Workers benefited from increased productivity, though
corporations profits rose more than workers’ wages
·
The period 1945-1970 in world history had been notable for the
idea that the growth of government spending meant corporations’ acceptance of
social responsibility and benefits, at least for a significant percentage of
people. In Europe, there was a growth of universal benefits; in the U.S. much
of the welfare benefits were achieved by attachment to particular core
corporations; those workers received good welfare and security, through
pensions, medical and life insurance, vacations; as they achieved these
benefits through private benefits, and higher wages, they continually scorned
the public programs
VI.
GOVERNMENT SUBSIDIZED MOBILITY AND SUBURBANIZATION FOR THE WHITE MIDDLE CLASS
·
New affluence, new ideals; 1947-1966 were years when
"real" wages grow 2.5-3 % a year ; manufacturers could pass along
higher wages in increased prices to consumers because of dominance of world
markets;
·
most of the upward mobility during the 1950s was subsidized
one form or another by government spending; these programs skewed to benefit
white middle class, as will be discussed below
·
Public spending on
domestic programs continues to create a two and three tier system of benefits
instead of universal entitlements.
VII. TIERED SYSTEM OF WELFARE
Tiered system of welfare provide the basis for the next 50
years of contentiousness over “welfare”. Welfare for white middle class always
seems natural and unassailable. But if one looks at the history of the creation
of this tiered system, the racial and ethnic biases inherent in its creation
are stark.
o
Divisions between upper and middle-class men and their
families, and those who received 2nd tier “welfare” climbed as taxes increased. Recipients of the second
tier programs became scapegoats.
o
The rise of private health insurance and pensions after WWII
further lessened middle-class support for a shared social citizenship.
o
For most Americans in 1950s, welfare state seemed
remote, even as the expenditures for 1st tier programs climbed.
n
Middle class programs were popular and incrementally
expanded.
n
Social security, veterans programs, mortgage deductions,
farmers subsidies were not perceived as welfare, but in fact each program was a
transfer of money to identifiable groups.
n
This continues under Republican administration of
Eisenhower, which passes such bills as disability insurance in 1956, more
unemployment insurance in 1958.
While social security provides a safety net and security unknown previously in the U.S. previous to the New Deal era, there was a racial and gender bias to the benefits established during the New Deal.
Social Security Act of 1935
While we associate social security with only the retirement benefit program, the Act of 1935 actually set up several programs, some that were perceived as a right and others began to be defined negatively as undeserved
--Set
up a 2-tier system—some benefits were seen as an earned right, while others
were seen as unearned—which reinforced rather than challenged the inequities of
the capitalist labor market.
Capitalist labor market depended on a surplus labor supply (unemployment) to keep labor supply high and thus wages low, a condition that affected a significant part of the population during the Great Depression. Almost all blacks and most women were part of a “surplus labor supply” and racial and gender biases resulted in placement in low-paid, lower-rung jobs or domestic and agricultural labor, jobs that didn’t provide for sustenance. Private employers discriminated as a standard practice of business.
1)
old
age retirement, which people paid into through payroll deductions, was seen as
a right.
o However, 3/5s of blacks (and many Latinos) were automatically written out of these benefits because of Southern Congressmen who sought to keep the surplus labor supply. Agricultural and Domestic laborers not covered. S. Congressmen connived to ensure that blacks wouldn’t be provided for in old age or unemployment, using the mantle of “state’s rights.” Succeeded in removing 2 clauses from old-age assistance, one that said states were required to provide “a reasonable subsistence compatible with decency and health,” and another requiring states to designate a single state authority to administer the plan. Southerners would not allow the federal government to dictate standards or set benefit levels.
“The going rate for day laborers was
two dollars per one hundred pounds of cotton, a day's labor for a strong
worker. Outside the cotton fields black women worked as maids, earning perhaps
$2.50 a week. Federal old-age insurance
paid directly to retired black men and women, even at the meager sum of $15 a
month, would provide more cash than a cropper family might see in a year.”
o 50% of women were intentionally written out as well, because it was believed that they should get their entitlements through marriage. Excluded job categories dominated by women, including nurses, teachers, domestic servants, retail.
2)
Unemployment
benefits were also established under the SSA, but under states’ control, and
resulted in mostly biased dispensing. If one had a good job and high wages, and
kept it for a significant amount of time, access to unemployment benefits
helped sustain survival during economic downturns, but this wasn’t available to
all. Certainly women and blacks who were excluded from old age retirement
program were also excluded from this.
3) United States Employment Service was established under SSA, but under states control, and the evidence confirms that this agency funneled workers to employers through racial and gender biases.
o
The employment offices set up by the program were
notorious for enforcing a racial code, even in the north. One study of Illinois
showed that the unemployment offices channeled black workers to lower paying
jobs and accepted employer discrimination as a basis of their operation. A black woman in Illinois applying for jobs
would be sent to domestic service primarily, for example. In 1948 75% of unskilled
jobs at employment agencies & in Michigan newspapers specifically excluded
blacks. Almost all skilled jobs did, and skilled trades unions also excluded
them from apprenticeship programs
4)
Most
blacks and women from 1930-1950 didn’t have access to top tier benefits and the
only other option for them were Old Age Assistance and Aid to Dependent
Children benefits.
·
Thus
the Social Security Act was shaped by racial and gender exclusions already in
operation that kept many blacks, Latinos and women from first-tier programs,
while second tier programs were made inferior with blacks in mind—as a result
we got lower provision for all poor, both white and minority
o
southern
Democrats opposed to any program that would grant benefits to blacks and
undermine their economy, which was based on cheap labor and available supplies of sharecroppers and
domestic servants
o
southern
congressmen also insisted on state control of the other SS
provisions—unemployment, ADC..
o
gender
biases reflected assumptions that white women were not considered regular
workers or employees;
o
As
participants in a paid labor force whose conditions increasing got better
through unionization, corporate dominance and monopolies, white men could be
seen as making a public contribution that sustained their entitlement to
benefits of the system
o
During
the postwar, unions and corporations extended private benefits instead of
extending welfare state or universal benefits.
o
Core
corporations, many of which benefited from the military Keynesianism of the
time, accepted social responsibility (or were forced to by the strength of
unions), which resulted in more private benefits.
o
Most
women and blacks and Latinos had a different relationship to the paid labor
force, however. Gender norms and racial
bias excluded them from jobs that provide significant resources. This
encourages their going to means-tested programs and that stigmatizes the programs themselves.
§ Blacks were at the bottom of the labor market and didn’t get access to the jobs with benefits and security provisions.
·
Women’s
jobs were lower paying, with fewer or no benefits.
·
Womens’
fortunes often required attachment to men for their benefits, or else they were
forced into the means-tested programs of ADC.
·
Thus
the welfare state reinforced women’s identity as men’s dependents both directly
and indirectly.
·
The
fact that women take off from the labor force to have children creates an
automatic bias. And what of women’s contributions to the economy by taking care
of children? Giving welfare to women in the 1930s was seen as a way to provide
for children, but when black women begin to take advantage of ADC in the 1950s,
they are seen as lazy and shiftless rather than providing care for children.
· Thus the welfare state reproduced and reinforced social inequities between groups rather than challenged them.
The factors that made the welfare law so excluding
and so inequitable also contributed to creating the need for welfare because it
shored up a system of race and gender discrimination and class exploitation
that created poverty in the first place. The welfare system created under
the New Deal didn’t create inequality in social citizenship, but reinforced
inequality, with consequences to the present
·
Eligibility
for social insurance from the best programs rested on regular, sustained
employment in covered occupations; those who didn’t have that were thrown into
public assistance programs that were means-tested—you had to prove that you
were worthy, and you were subject to constant checks regarding your
worthy-ness. This was not a right of citizenship, and the benefits were not
enough to sustain health. In addition, because they were eventually defined as
“welfare” while
·
While in the 1930s, all programs financed by government
intervention, from social security retirement to AFDC were thought of as
“welfare”, by the 1950s, only the lower-tier programs are defined as welfare,
and they are the ones subject to cut-backs when blacks, Latinos and other
groups began to gain access to them.
·
White women were always been the leading recipients
numerically of AFDC and food stamps, and these programs historically have taken
a negligible amount of the federal budget, even as they became the source of
great political debate. (Even in 1996, when the welfare reform bill that ended
“welfare as we know it”-- both AFDC and food stamps together took only 3% of
the federal budget outlays).
·
But in the
1950s as more whites get access to well-paying jobs, the means-tested programs
get labeled as welfare, while programs like unemployment and social security
retain the idea that they are legitimate, and not “welfare”.
o
Divisions
between upper and middle-class men and their families, and those who received 2nd
tier “welfare” climbed as taxes
increased. Recipients of the second tier programs became scapegoats.
o The rise of private health insurance and pensions after WWII further lesse