Globalization,government spending and taxation in the OECD

Abstract. This article assesses the impact of globalization on welfare state effort in the OECD countries. Globalization is defined in terms of total trade, imports from low wage economies, foreign direct investment, and financial market integration. Welfare effort is analyzed in terms both of public spending (and separately on social service provision and income transfer programs) and taxation (effective rates of capital taxation and the ratio of capital to labor and consumption taxes). Year–to–year increases in total trade and international financial openness in the past three decades have been associated with less government spending. In contrast, integration into global markets has not been associated either with reductions in capital tax rates, or with shifts in the burden of taxation from capital to consumption and labor income. Moreover, countries with greater inflows and outflows of foreign direct investment tend to tax capital more heavily.     

Local Heroes? Learning from Recent Community Strengthening Initiatives in Victoria1

Policies and programs which aim to strength the engagement, connectedness and resilience of local communities have increasingly become a core element in public policy responses to the challenges posed by globalising social and economic relations. However, for many politicians, policy makers and citizens the conceptual framework and practical benefits of ‘community strengthening’ remain vague and unclear. This article aims to contribute to debates about the significance of community strengthening by providing a concise overview of the development and implementation of community strengthening initiatives by the Bracks Labor government in Victoria. Initial learning from this experience suggests that engaging and linking local communities can make a useful contribution to local social, environmental and economic outcomes as well as providing a foundation for the democratic renewal of local governance. Key factors underpinning successful community strengthening programs include strong local ownership and leadership, backed by sustained government investment in the social and physical infrastructure priorities identified as important by local communities. However, while local community strengthening strategies can lead to real improvements in community networks, infrastructure and capacity they are no substitute for the inclusive and redistributive taxation, income security, service delivery and labour market policies needed to create the conditions for sustainable reductions in poverty, inequality and social exclusion.     

Packaging Support for Low‐Income Families: Policy Variation across the United States

This paper addresses a gap in state‐level comparative social policy research by analyzing policies that support low‐income families with children. Variation in state policy “packages” is measured by considering three characteristics of 11 social programs. Individual measures of policy are found to be weakly and inconsistently inter‐correlated at the state level, but when cluster analysis is used to analyze multiple dimensions simultaneously, five clusters or regime types are identified that have distinctive policy approaches. These range from the most minimal provisions, to conservative approaches emphasizing private responsibility, to integrated approaches that combine generous direct assistance with employment support and policies that enforce family responsibility. A comparison of a subset of programs at two points in time (1994 and 1998) suggests that states made substantial changes in cash assistance and taxation policies after the 1996 federal welfare reforms. The magnitude and direction of these changes remained consistent with the state clusters identified in 1994. © 2001 by the Association for Public Policy Analysis and Management.     

Varieties of Social Policy by Other Means: Lessons for Comparative Welfare State Research

Abstract

Scholars can take a broader look at social policy and understand that traditional public welfare state programs are only one of the many potential sources of social protection and regulation. The contributions of this special issue invite social policy scholars to explore policy instruments that provide “social policy by other means” across a wide array of areas, including agriculture, energy, immigration, taxation, and legal regulation of private benefits and services. The article provides a concise overview of some of the key theoretical and empirical implications of social policy by other means for comparative welfare state research. In order to do this, it is divided into two main sections, which respectively discuss the nature and boundaries of social policy and the varieties of social policy by other means. This is followed by a short conclusion, which summarizes the key lessons of this special issue for comparative welfare state research.     

Public finance management reforms in Somalia: a case study on Somalia's finance professionals

There is an unprecedented and pressing need for a major legislative public financial management reform in Somalia to bolster the technical and professional efforts of implementing a modern system of public financial management across the country. Currently, there is no independent auditing authority to enable citizens to access information on the use of public resources. However, the success of any reform depends on establishing strong public budgeting systems as well as developing strong public finance training programs and policy linkage on financial management policies and procedures.     

Harmonization of social policies and social regulation in the European Community

Abstract. The development of the European Community entails harmonization of policies in many areas. This paper analyses to what extent harmonization has taken place in the traditional fields of social policy. Interventions by the EC authorities in the social policy area, here termed direct harmonization, are examined. Indirect harmonization, resulting from common economic policies and the internationalization of the economy, is used as a key concept in an empirical study of the development of coverage, benefit levels and methods of financing in the main social insurance systems within the EC countries, since 1955. The corresponding development in the EFTA countries is here used as a baseline for comparison. The results are discussed in light of the thesis that also in the social field EC policies may fruitfully be interpreted in terms of the EC's main objective of economic integration. Some criteria for the consideration of future developments are suggested.     

THE RELEVANCE OF COMMUNITY INVOLVEMENT TO SOCIAL WELFARE AND PUBLIC ADMINISTRATION

Abstract: Citizen involvement is regarded as a desirable component of public policy making, particularly policy in the social welfare field. This paper examines different conceptions of social welfare and different conceptions of citizen participation. Participation is a term with many shades of meaning, and policy makers should distinguish between sociotherapy, market research and citizen power, all of which come under the rubric "citizen participation". Different conceptions of participation are appropriate in different policy circumstances and these circumstances are examined with reference to two recent Australian participatory programs in the welfare field. The paper concludes with an examination of the applicability of participation, leadership and expertise to public administration, and argues that these three values exist in a dialectical relationship and that social justice and the effectiveness of programs will be limited if too much reliance is placed on any one of these values.     

Environmental equity and public participation

The principles and practice of public participation can serve to promote environmental equity for disadvantaged social groups. The effectiveness of such practice in preventing or reducing environmental inequity depends upon the use of participation methodology which caters to the cultural and social needs of such groups. These methods need to provide appropriate forms of information, suitable venues for participation, and access to expertise and education which enable the public to understand policy issues and formulate preferences. The extent to which public preferences are incorporated in policy decisions determines the worth of public participation programs in promoting environmental equity.     

Public Attitudes towards Taxation: Sweden 1981–1997

Claims have been raised from different perspectives that the welfare state suffers from eroding public support. From an examination of public attitudes towards taxation in Sweden by utilising survey data spanning the period 1981–1997, it is concluded that no long-term trend of increased tax discontent can be distinguished. There are, however, some indications that discontent with taxation has increased during the most recent years. Social conflicts over the preferred distribution and levels of taxes vary in intensity over time, but are foremost structured by class, income, and, to a lesser extent, sector of employment. It is argued that the observed attitude patterns can to some extent be understood as responses to changes in tax and welfare policy.     

Do parties matter for local revenue policies? A comparison of Denmark and Norway

Abstract.  This article investigates the impact of party ideology on revenue politics. Theoretically, claims can be made that party ideology should matter for revenue policies. First, leftist governments are more favourable towards government intervention and a large public sector. To accomplish this, leftist governments need more revenue than bourgeois governments. Second, revenue policy is a redistributive policy area well suited for ideological positioning. However, the claim that party ideology does not matter can also be made since raising revenue is unpopular and politicians may shy away from new initiatives. Empirically, the question is unsettled. The article investigates the problem by looking at three revenue policy areas (income and property taxation, and user charges) in two countries (Denmark and Norway). The data used is from the municipal level, providing several hundreds of units to compare. The evidence favours the 'parties matter' argument, particularly in the Danish case.     

The Gautreaux Legacy: What Might Mixed‐Income and Dispersal Strategies Mean for the Poorest Public Housing Tenants?

Abstract

The current transformation of public and assisted housing reflects the legacy of the Gautreaux case, which created the first mobility and scattered‐site programs. Mixed‐income and dispersal strategies now dominate federal housing policy, although their focus has shifted. Drawing on evidence from two preliminary studies of public housing transformation in Chicago, we argue that these new strategies seem to offer benefits for distressed public housing communities but also involve risks for the most vulnerable current tenants. Increased screening and/or the need to compete with private market tenants may force these families out of the assisted housing market.

Addressing the complex needs of the most troubled public housing tenants will call for a more comprehensive solution. The intent of the Gautreaux case was to increase opportunity and enhance quality of life for public housing tenants; policy makers should take steps to ensure that current programs reflect these fundamental goals.     

Taxing Higher Incomes: What Makes the High-Income Earners Consent to More Progressive Taxation in Latin America?

When do high-income earners get ‘on board’ with the fiscal contract and accept paying a larger share of the tax burden? Progressive taxes perform particularly poorly in developing countries. We argue that the common opposition of the affluent to more progressive taxation is not merely connected to administrative limitations to coercively enforce compliance, but also to the uncertainty that high-income earners associate with the returns to taxes. Because coercion is not an option, there is a need to convince high-income earners to ‘invest’ in the public system via taxes. Trust in institutions is decisive for the fiscal contract. Expecting that paid contributions will be used in a sensible manner, high-income earners will be more supportive of progressive income taxation. We study tax composition preferences of a cross-section of Latin American countries using public opinion data from LAPOP for 2012. Findings reveal that higher levels of trust in political institutions strongly mitigate the opposition of the affluent towards more progressive taxation.     

New Labour and Government in Britain: Change or Continuity?

The 1997 British election marks a major change in British government. Eighteen years of Conservative rule had brought about growing inequality and social division and have generated powerful demands for new directions in public policy, especially in the areas of welfare and public administration. On welfare state reform Labour is constrained by election promises to restrain taxation and public expenditure. New Labour ministers influenced by the New Right have in any case largely rejected traditional social democratic redistributive strategies and are seeking instead new ways of reducing welfare dependency.
The virulent spread of quangos at all levels of government and a marked increase in the centralisation of power in Whitehall have given a new impetus to demands for constitutional reform. Labour's response to these demands is a major program of regional devolution, House of Lords reform and open government measures.
This article explains what 'New Labour' means and discusses New Labour policies on welfare and constitutional reform and their implications for the future of public administration in Britain.     

Public Attitudes Toward Social Spending in the United States: The Differences Between Direct Spending and Tax Expenditures

This paper uses a survey experiment to examine differences in public attitudes toward ‘direct’ and ‘indirect’ government spending. Federal social welfare spending in the USA has two components: the federal government spends money to directly provide social benefits to citizens, and also indirectly subsidizes the private provision of social benefits through tax expenditures. Though benefits provided through tax expenditures are considered spending for budgetary purposes, they differ from direct spending in several ways: in the mechanisms through which benefits are delivered to citizens, in how they distribute wealth across the income spectrum, and in the visibility of their policy consequences to the mass public. We develop and test a model explaining how these differences will affect public attitudes toward spending conducted through direct and indirect means. We find that support for otherwise identical social programs is generally higher when such programs are portrayed as being delivered through tax expenditures than when they are portrayed as being delivered by direct spending. In addition, support for tax expenditure programs which redistribute wealth upward drops when citizens are provided information about the redistributive effects. Both of these results are conditioned by partisanship, with the opinions of Republicans more sensitive to the mechanism through which benefits are delivered, and the opinions of Democrats more sensitive to information about their redistributive effects.     

The political economy of targeting

One of the most widely used method of targeting is to reduce welfare benefits as income rises. Although the need for such targeting is clear enough, it also entails two important difficulties. Firstly, the prospect for the recipients of losing part of their benefits if they were to earn more can be a deterrent to work harder. Secondly, by reducing the number of recipients, targeting reduces the political support for taxation and redistribution. The purpose of this paper is to study the voting equilibrium of the degree of targeting and the level of taxation in an economy where labour supply is variable. The analysis reveals that targeting may be fatal for redistribution even though it rejects strictly less than the richest half of the population, and that it is not possible for a coalition of the extremes to form and reject the middle income group from the welfare system. Moreover, because targeting affects labour supply, we find that Pareto improvements are possible when targeting is either “too low” or “too high”. We also find that voting simultaneously over taxation and targeting is favourable to the poor in the sense that they can converge to their most-preferred policy by successively forming a majority coalition with the rich to increase targeting and with the middle to increase taxation.     

A Multilevel Framework for Effective Interagency Collaboration in Mental Health

The difficulty of coordinating service provision in interagency programs is a challenge for many working in public policy. We reflect on lessons learned through evaluating two inter‐agency supported housing programs for people with mental illness and propose a framework outlining components needed for well co‐ordinated service provision. We specify collaborative mechanisms at the policy, agency, service and client level. The key component is the role of an ‘integration coordinator': a person who is able to facilitate relationships and ensure effective information flows. Relationships need to be actively maintained to meet the inevitable challenges that will arise in complex interagency systems. The framework is relevant to policymakers across the public sector, including mental health, drug and alcohol, aged care, and policing.     

Progressive tax policy and informal labor in developing economies

Governments in many industrializing democracies face difficult policy trade‐offs. Liberalization and informality have placed electoral pressure on them to expand noncontributory social spending. However, governments in developing democracies face constraints when attempting to finance this expansion. In some countries, the informal labor market is very large, thereby undermining the revenue that can be collected through income tax. We argue that this has given rise to a paradoxical situation. Left governments in developing democracies with large informal labor markets have a strong electoral incentive to expand welfare regimes to previously excluded outsiders, but to fiscally underwrite this expansion, they have increasingly been forced to fund their redistributive strategies via a regressive policy instrument, indirect consumption taxation. We examine this argument for a sample of 17 Latin American countries between the years 1990 and 2016. Our results suggest that labor informality forces left governments to turn to indirect taxation.     

DIFFERENTIAL PROGRAM IMPACT AS A FUNCTION OF TARGET NEED: OR WHY SOME GOOD POLICIES OFTEN SEEM TO FAIL

A growing body of evaluation research has been reporting negative or lack of positive effects from a wide range of social policies and programs. Yet within the data presented one can frequently detect that relative ineffectiveness is far from uniform across time periods and/or population groups.
Evidence may be gleaned from existing research to suggest that some policies have differential effectiveness, being most effective where and when the need is greatest, with "need" measured as the change in conditions reasonably assumed to be the policy goal.
The essay cautions policy analysts against over-aggregation of data on policy impact. It also argues that a substantial amount of money and public effort could be saved, without sacrificing net positive effect, by fitting policy efforts to demonstrable need/effectiveness curves.     

MPP programs emerging around the world19

This paper examines public policy and management programs in Canada, Europe, Australia, and New Zealand, and makes comparisons with similar programs in the United States. Our study of public policy programs shows that there are many challenges ahead in terms of making good decisions on the form and content of programs that will add value to governments and citizens. Appropriate choices in terms of program design and pedagogy will reflect different economic, social, environmental, and cultural influences and will be shaped by history, values, and the roles of public policy and management professionals within a particular governmental context.     

ALTERNATIVE IMAGES FOR PUBLIC POLICY: FAMILY STRUCTURE VERSUS FAMILIES STRUGGLING.

A constrast is drawn between public policy and programmatic implementations of policy. The argument is made that conservatives possess a coherent and thoughtful family policy, whereas progressives are devoid of such a policy. Lacking any "high moral ground" progressives find themselves on the defensive when proposing specific programs. Consequently guidelines for a progressive policy for families is proposed, along with examples of programs that might derive from it.