Election Night: Panel Debate on Welfare Politics in the U.S.
Moderated by the Election Night’s main man, Jacob Sohlberg, a short panel debate with two other U.S. experts of the Department’s — post doc Johan Bo Davidsson and professor assistant Moira Nelson — touched upon U.S. welfare compared to European welfare, the American treatment of its poor, higher education, outsourcing, and, of course, Obamacare.
By: Tim Isaksson
The first topic was whether the U.S. welfare system is really that different from the European. The answer? Yes and no. No, because when the private aspect of it is included (which academics long have been bad at doing not least since it is way more difficult), for example unemployment insurances such as redundancy packages (“parachutes”) and mortgage reductions, welfare provision might actually be more comprehensive than it is in Europe. However, yes because this social security net is very discriminatory, i.e. a lot of people are not included. Poor people simply will not receive these benefits because they don’t have the “decent” enough jobs that supply them. The middle class is typically very well-covered while people with unstable incomes lead a lot less secure lives. So the real difference is the question, “Who is included in the welfare system?”.
So why is that? Why are poor people not treated better, what is the rationale? The American mentality of course cannot be overlooked in this regard. ‘Everyone for himself’ is plainly not conductive towards a welfare system fighting injustice and inequality. But, argue Johan and Moira, this is hardly the entire explanation. Rather, as much or more of the underlying factors is the political institutions themselves. For example, even if this has decreased somewhat during later years, there has in the U.S. long been strong public support for a national healthcare insurance system. Even so, it was not until the historic achievement of Obamacare (after a 100 years of trying to implement similar programs) that something of significant scale and coverage population-wise made it through Congress. The reason is the two-party majority election system and the two-chamber legislature with all of its, and the president’s, checks and balances. This in itself didn’t help national health insurane, and neither did the historically alignment-free union movement; the union’s unwillingness to connect to either of the political parties (for other reasons than healthcare policy) made it impossible for them to lay their political clout behind a policy even though it perhaps would have benefitted their members the most, since the American political spectrum is more of a two-colour cartoon which hence does not have room enough for another player, no matter how big, to directly influence policy. Another reason behind why the U.S. welfare system in its entirety since its heyday in the 1930s (not only due to the depression’s keynesian Big Deal) now has become both smaller in spending and worse in quality than Europe, is the federal system. It is simply not possible for the federal government to dictate too much of state-level policies.
The debate then moved on to education. Even though spending on education in general is decreasing in the U.S., the country is still the largest per capita spender on tertiary education. However, there are large differences not only between states, cities and city districts, but also between neighborhoods, since per capita spending on neighborhood-level for some reason is subject to the size of property tax paid. Tertiary education policy in general is also in large part a state-level issue and therefore hard for the President or Congress to deal with. The debate also touched upon vocational education, which is something embraced to differing degrees by all big political players but even so not an area in which consensus or even compromise has been easy to reach, since it is seen to be such a strong pro-union policy. Concerning student loans and resulting huge debts for U.S students, the start of this problem was by Moira blaimed on Stanford, which raised its tuition fees in order to further boost the university’s prestige — a move that of course forces othersto follow suit. Another problem, presented by a member of the audience, is that there is a limit on federal student loans (which have bad conditions), which leads to the need for students to take out loans from private banks as well (with even worse conditions).
A brief moment, almost like a pause in the short but high-tempo debate, was devoted to the question of outsourcing. Hotly debated by the presidential candidates throughout the campaign (Obama blaiming Romney for it; Romney blaiming Obama for it, and both meaning to bring “the jobs back”), this is an issue where there is a huge discrepancy between politicians and academics. The latter group have traditionally been of the conviction that once gone, outsourced jobs are very hard to get back, if not impossible, through the economic workings of the world market. Therefore, they haven’t really considered if it is in fact possible and not just empty talk to bring the jobs back, if the political will is there. According to Johan and Moira, academics might actually be inspired by politicians on this one – however, as is this writer’s personal understanding of the debate, only to a small degree: it is still not nearly seen as being feasible on the large scale.
Lastly, Obamacare was discussed. Not only was it a big achievement for Obama, it was also a very risky endeavor indeed, considering the last two years heavy partisanship in Congress. Beause even though the Democrats had a majority in both chambers for Obama’s first two years in office, the work of pushing the reform through Congress required a big portion of bipartisanship, which however very quickly was lost in favor of all but a deadlock in many questions. And when Democrat Senator Ted Kennedy passed away and thereby making it possible for Republicans to fillibuster any Bill out of a chance to become reality (as well as the Democrats losing one of the strongest voices for healthcare reform), all hope seemed lost. After a lot of compromise and the usage of a shortcut –a reconciliation procedure deal originally designed for quickly approving budget adjustments — the reform finally came into existence, even if it was the more conservative version of it. As said, a huge victory for Obama and a big step towards the welfare systems of other countries.
by Tim Isaksson