Social Policy“The preamble to the

Constitution states that ‘We the People of the United

States, in Order to create a more perfect union, establish Justice…promote the general

Welfare…do ordain and establish this Constitution.’ Social policy is set with this

important charge in mind.” - Wood

Social Policy: An overview• Government’s responsibility for the welfare of its citizens

remains controversial and disputed today• Generally 2 types of programs:– Majoritarian- benefits almost everyone

• Ex. Social Security, Medicare

– Client- benefits only a small number• Ex. Medicaid, Food Stamps• Means tested- must fall below a certain income level to qualify

• Entitlement programs: government-sponsored programs providing mandated benefits to those who meet eligibility requirements

Social Welfare in the United States 4 Factors shape policy:1. Who should benefit? Insistence that it be only

those who cannot help themselves• Slow, steady change in deserving/undeserving

line • Alterative view: fair share of national income;

government redistribute money • Preference to give services, not money, to help

deserving poor

2. Late arrival of welfare policy • By 1935 Social Security Act, we were behind

twenty-two European nations • Contrast with Great Britain in 1908– “What ordinary politics brought to England in 1908,

only the crisis politics of 1935 would bring to the United States.”

– But once the programs started, they grew fast!• By 1983, one third of all Americans received benefits from

one or more social welfare programs.

3. Influence of federalism • Federal involvement “illegal” until 1930s – Why? Powers not delegated are left to states– What changed? Courts constitutional interpretation

• Experiments by state governments – Argues against federal involvement because state

already providing welfare – States lobbied for federal involvement to help them

4. Non-govt institutions play a big role

• Non-govt institutions get contracts and grants to administer social welfare programs– Ex. Big Brothers/Big Sisters, Catholic Charities

• 1996 Welfare reform law allowed religious organizations to compete for govt contracts=Charitable Choice (but couldn’t use $$ to preach)– Bipartisan support, programs have increased

Majoritarian welfare programs Social Security Act of 1935• Great Depression of 1929: local relief was overwhelmed • Elections of 1932: Democrats & FDR swept in– Legal and political roadblocks; was direct welfare

unconstitutional?– Fear of more radical movements

– Long’s “Share Our Wealth”– Sinclair’s “End Poverty in California”– Townsend’s old-age program

• Cabinet Committee’s two-part plan– “Insurance” for unemployed and elderly – everybody pays/benefits– “Assistance” for dependent children, blind, aged – everybody pays, some

benefit– Federally funded, state-administered program under means test

Majoritarian welfare programs Medicare Act of 1965• Medical benefits omitted in 1935: controversial but done to ensure

passage • Opponents:

• AMA • House Ways and Means Committee under Wilbur Mills (R-Arkansas)

• 1964 elections: Democrats’ big majority altered Ways and Means Com.

• Objections anticipated in plan • Applies only to the old, not everybody • Only hospital, not doctors’, bills covered

• Broadened by Ways and Means to include Medicaid for poor; pay doctors’ bills for elderly

• Passed the Democratic-controlled Congress with ease

Reforming majoritarian welfare programs

Social Security • Not enough people paying into Social Security • Three solutions: – Raise the retirement age to seventy, freeze the size of

retirement benefits, raise Social Security taxes – Privatize Social Security- people would contribute into

account invested in Stock Market (better return, but risky)– Combine first two methods and allow individual investment

in mutual funds

Reforming majoritarian welfare programs

Medicare • Problems: huge costs and inefficient • Possible solutions – Get rid of Medicare and have doctors and hospitals work for

government (Con: slower care, fewer benefits, less innovation)– Elderly take Medicare money and buy health insurance (con:

affordability)• Delaying the inevitable – Clinton used the surplus to create new benefits (prescription

drug plan)– Bush and attempts at new health care measures – Medicare

Modernization Act of 2003 (pushed by interests -AARP)

Pros and Cons: Majoritarian politics

• Programs with widely distributed benefits & costs – Beneficiaries must believe they will come out ahead – Political elites must believe in legitimacy of program

• Social Security & Medicare seemed great!• Debate over legitimacy: Social Security (1935)– Constitution did not authorize federal welfare

(conservatives)– But benefits were not really a federal expenditure (liberals)

• Good politics unless cost to voters exceeds benefits

Client welfare programs: AFDC(Aid to Families with Dependent Children)

• Scarcely noticed part of Social Security Act • Federal government permitted state to

– Define need – Set benefit levels – Administer program

• Federal government increased rules of operation, added more and more regulations

• New programs (e.g., Food Stamps, Earned Income Tax Credit, free school meals)

Client welfare programs: AFDC• Problems:– States complained about federal regulations – Public opinion turned against program

• Corruption• Weakened the family (got more money for more kids)

– Composition of program participants changed • 1970: half of women were widowed/divorced• 1994: only 1 quarter, the rest never married• Also, 2/3 of women were on for 8 years or more!

• Temporary Assistance to Needy Families (TANF) 1996– Stricter requirements and limits on how long families could

collect– Lowered welfare caseload by 60%

Pros and Cons: Client politics

• Programs pass if cost to public not perceived as great and client considered deserving

• Americans believe today that able-bodied people should work for welfare benefits

• Americans prefer service strategy to income strategy (give service/training rather than money)– Charles Murray: high welfare benefits made some

young people go on welfare rather than seek jobs – No direct evidence supports Murray

Social Policy • U.S. government currently assumes

responsibility for – Health care– Welfare– Education