The budgetary implications of welfare reform: Lessons from four state initiatives

Required work and training, a major component of recent “welfare reform” proposals, is intended to increase the self-sufficiency of welfare recipients and thereby produce savings for government treasuries as well as more income for the recipients themselves. This analysis focuses explicitly on the budgetary effects of such activities, estimating the cost savings and new revenues generated by welfare employment programs started in four states since 1981. It suggests that when a broad range of effects are taken into account over a sufficiently long period, the overall budgetary implications of the programs are usually positive at the federal, state, and local levels of government. The costs and gains, however, are shared unevenly by the three levels, which encourages disparities in the programs states and localities choose to implement.     

Rethinking measures of democracy and welfare state universalism: Lessons from subnational research

ABSTRACT

Democracy and the welfare state are two of the most extensively studied concepts and themes in the field of comparative politics. Debate about how to best measure the two concepts has failed to contemplate the extent to which political and social rights are uniformly present across distinct regions of the national territory, despite the presence of substantial subnational research that underscores wide variation inside countries. We argue that this omission hampers our understanding of the two phenomena and we propose a new measure of democracy and healthcare universalism, which we call the Adjusted Measures of Democracy and Welfare Universalism. The new measures integrate territorial inequality into existing national-level indicators, providing a more accurate picture of country performance and opening the door to new, multi-level theory building.     

Public opinion towards welfare state reform: The role of political trust and government satisfaction

The traditional welfare state, which emerged as a response to industrialization, is not well equipped to address the challenges of today's post-industrial knowledge economies. Experts and policymakers have therefore called for welfare state readjustment towards a ‘social investment’ model (focusing on human skills and capabilities). Under what conditions are citizens willing to accept such future-oriented reforms? We point at the crucial but hitherto neglected role of citizens’ trust in and satisfaction with government. Trust and satisfaction matter because future-oriented reforms generate uncertainties, risks and costs, which trust and government satisfaction can attenuate. We offer micro-level causal evidence using experiments in a representative survey covering eight European countries and confirm these findings with European Social Survey data for 22 countries. We find that trust and government satisfaction increase reform support and moderate the effects of self-interest and ideological standpoints. These findings have crucial implications not least because they help explain why some countries manage – but others fail – to enact important reforms.     

How governments strategically time welfare state reform legislation: empirical evidence from five European countries

Abstract

Building on studies on the political business cycle, the literature on welfare state retrenchment has argued that governments which cut the welfare state try to avoid blame by implementing painful measures in the beginning of the mandate and expanding benefits as elections approach. In contrast to this linear relationship, this article argues that governments often feel pressured to fulfil (mostly expansionary) campaign promises during the first months in office. Consequently, cutting right away is not what should be expected. Instead, a more nuanced, U-shaped timing trajectory is probable with a period in the beginning characterised by both cuts and fulfilment of expansionary pledges, followed by a period of cutbacks, and finally an expansive phase towards the end of a mandate. This argument is tested on our new original dataset of legislative changes in five European countries – Britain, Denmark, Finland, France and Germany – during the last four decades.     

A research context for welfare reform

Responsibility for the social safety net continues to “devolve” from the federal to state governments, and many states are now confronting the dilemmas inherent in redesigning welfare—dilemmas that faced Congress, too, as it sought to impose new conditions on receipt of public assistance. This article argues that reforming AFDC is difficult because the public has conflicting goals: putting welfare recipients to work; protecting their children from severe poverty; and controlling costs. For 25 years, reformers have viewed requiring welfare recipients to participate in work-promoting programs as uniquely able to balance these goals. Numerous studies have shown that this approach modestly increased employment and reduced welfare costs. More substantial gains have been achieved by some “mixed-strategy” programs, which stress immediate job entry for some recipients and employment-directed education or training for others. Many people remain on the rolls, however, prompting some policymakers to argue for substituting work-for-benefits or community service work (“workfare”) for welfare after a certain period of time, and others for ending all support. The limited knowledge about work-for-benefits programs suggests that, in contrast to work-promoting activities, this approach ultimately costs money. The research record confirms that there are no easy answers in welfare reform, and that states will have to weigh the trade-offs in considering alternative strategies.     

Electoral competition and the welfare state

The article investigates how parties compete over the welfare state by emphasising specific welfare state issues. The core argument is that two issue-specific factors determine how much parties emphasise individual welfare state issues: the character of policy problems related to the policy issues and the type of social risks involved. To test the argument, a new large-N dataset is employed, with election manifestos from Belgium, Denmark, France, Germany, the Netherlands, Sweden, and the United Kingdom. The dataset contains information on how much parties have talked about health care, education, and labour market protection in national elections since 1980. With the data at hand, it is possible to provide the first systematic investigation of how parties compete for votes over the welfare state. The approach here is able to explain the empirical fact that health care is consistently receiving increased attention everywhere, while particularly labour market protection has witnessed a decline in attention.     

Immigrants,welfare reform,and the economy

The welfare reform bill adopted in the United States in 1996 limited the eligibility of immigrants for several government assistance programs, and early projections estimated that nearly half of the savings associated with the reforms would come from these immigrant restrictions. Several studies have found that subsequent program participation declined more for immigrants relative to natives, seemingly verifying the early projections. However, many of these restrictions were either rescinded by the federal government or superceded by state and local policies. In this paper, we first reproduce earlier findings that show the relative declines in program use among immigrants. We then show that much, but not all, of the relative decline in program use among immigrants can be explained by changing macroeconomic conditions. © 2004 by the Association for Public Policy Analysis and Management.     

Time,social justice and UK welfare reform

While analyses of time have never strayed too far away from those of social justice, and vice versa, this article's premise is that they have so far failed to converge as directly and coherently as they might. The aim of this article is to facilitate a greater degree of convergence by working within a framework of liberal equality and establishing similarities in the work of the two theorists who have gone furthest in bringing the various debates together. These are Robert Goodin and André Gorz, and the article explores the respective strengths and weaknesses of their ideas. A liberal theory of socio-temporal justice is derived from their work and is then used to critique some recent developments in UK welfare reform.     

Instrument choice,political reform and economic welfare

The purpose of this paper is to formally examine the effect of placing constraints, such as the line-item veto or a balanced budget amendment, on legislative behavior. There are two basic findings that emerge from the analysis. First, constraints on one type of instrument, such as spending, will in general result in more widespread use of other kinds of instruments, such as regulation. Second, it is naive to conclude that constraints on legislative behavior will promote economic efficiency and/or reduce the growth of government. The primary contribution of the paper is to suggest how changes in the political environment can affect instrument choice, economic welfare, and the size of government.This research was supported in part by a grant from the National Science Foundation Decision, Risk and Management Science Program. The author gratefully acknowledges the helpful comments of Ed Campos and Allan Meltzer. The views in this paper are solely those of the author and do not necessarily reflect the views of the Council.     

Has welfare reform changed teenage behaviors?

Data from the National Longitudinal Surveys of Youth 1979 and 1997 cohorts were used to compare welfare use, fertility, educational attainment, and marriage among teenage women in the years before and immediately following welfare reform. The first objective was to document differences between these cohorts in welfare use and outcomes and behavior correlated with entry into welfare and with future economic and social well‐being. The second objective was to investigate the causal role of welfare reform in behavioral change. Significant differences were found between cohorts in welfare use and in outcomes related to welfare use. Furthermore, difference‐in‐differences estimates suggest that welfare reform has been associated with reduced welfare receipt, reduced fertility, and reduced marriage among young women who, because of a disadvantaged family background, are at high risk of welfare receipt. Finally, in the post‐welfare reform era, teenage mothers are less likely to receive welfare and are more likely to live with at least one parent than in the pre‐reform era. Establishing more definitively that welfare reform is responsible for these changes will require further investigation. © 2003 by the Association for Public Policy Analysis and Management.     

Recalibrating social protection: Electoral competition and the new partisan politics of the welfare state

This article investigates the new party politics of welfare states with a particular focus on electoral competition. The argument is that welfare state politics are no longer just about more or less, but involve trade-offs among ‘new’ versus ‘old’ social rights, and hence social investment versus social consumption. However, party priorities on these issues are highly dependent upon their electoral situation. As electoral competition becomes more intense, parties focus more on vote maximisation than on their traditional policy goals. For left parties, this means focusing more on social investment, which appeals to their growing constituency of progressive sociocultural professionals, and less on defending the traditional income maintenance programmes favoured by their core blue-collar voters. Centre-right parties, on the other hand, should hesitate to retrench old social rights when electoral competition intensifies because they need to prioritise their appeal to culturally conservative working-class voters over their traditional fiscally conservative policy profiles. Using a new dataset and a recently published measure of electoral competitiveness, the article shows that as electoral competition intensifies, left governments are willing to prioritise social investment by reducing pension rights generosity in order to expand programmes for new social risks, while centre-right governments by contrast avoid retrenchment of pension rights and pension expenditures. The findings demonstrate that this relationship is moderated by the presence of a credible radical right challenger, which increases the electoral risk of welfare state recalibration.