WELFARE STATE SERVICES

Welfare State Services

Welfare State Services

Introduction

Modern welfare states have matured far beyond these origins. In many countries, the question of contemporary governance of the welfare state is not how to build and expand it, but instead how to manage it in an era of permanent fiscal austerity. This challenge involves balancing growing social demands with the rising costs and more limited fiscal leeway associated with an aging population, greater labor market volatility, and globalisation.

Discussion

Social welfare at the beginning of the 21st century operates through both public and private service provision. The federal government funds services that state governments and local entities administer in a fragmented or decentralised fashion. The private sector providers formally tied into this network include private industry, philanthropic organisations, and voluntary charities (Iversen, 2008). Informal participants include the local community, friends, neighbors, and families.

The degree to which the various formal and informal providers participate in service provision has increased over time, with more state and local level organisations directly involved. This decentralisation of services to the local level has brought smaller secular organisations and an influx of religious institutions in the formal side of service provision. These groups are now a part of the expanding welfare state—the body that assumes responsibility for the social and health needs of individuals with low income—due in part to passage of the Charitable Choice provision in the 1996 welfare reform legislation (Prabhakar, 2007).

While most welfare states are experiencing these common challenges, they have manifested themselves differently across advanced countries, with some experiencing more severe problems of unemployment, inequality, and budgetary stress than others. As a result, the question of how to balance competing goals of securing individual welfare, economic growth, and fiscal discipline in modern welfare states may be resolved in highly differentiated ways (Legrand, 2006).

Three groups dominate the current debate on social welfare—liberals, conservatives, and radicals. Liberals and conservatives, mirroring the British Conservatives and Labour Parties respectively, have debated the future of the welfare state since the 1960s and 1970s. The groups agree that the current system is ineffective and that the problem of poverty can only be solved if active measures are taken on all levels. However, Democrats emphasise the structural problems in society that restrict individuals' abilities to support themselves. They propose providing people with the tools they need to acquire skills necessary for sustainable employment opportunities. In contrast, Republicans follow the individual causations argument that focuses on individual shortcomings, thus turning to psychological theory and therapeutic approaches as solutions. They admit that some structural causes are to blame, but they emphasise behavior as the root cause of social problems. Their prescription focuses on changing behavior and restoring traditional values like morality and hard work, intact families, and self-responsibility (Crouch, 2007).

Third-way Welfare Reform

Third-way welfare reform has not gone unchallenged. Some believe that foundation hospitals are a fig leaf for privatisation. They argue that while foundation hospitals are not allowed to make dividend payments, the fact that they can raise money from capital markets means that ...