Political Considerations
Benjamin I. Page
The political obstacles confronting an Employment-Centered Social Policy
of the kind Robert Haveman advances are great, but in the medium to long run
they may not be insurmountable. To assess the political strengths and weaknesses
of the proposal, or formulate a political strategy to enact it into policy,
we need to figure out precisely what stands in its way and what does not.
1. Public Opinion. As a student of public opinion I believe I can
say with some confidence that the policy preferences of ordinary citizens
need not be an obstacle. The benefit levels and other details need to be spelled
out. But in the United States (perhaps not in European countries with generous
and accessible current systems) it may be possible to flesh out the proposal
in such a way that many people would gain from it while few would lose. If
so, and if that fact is made clear through vigorous leadership and favorable
publicity, public opinion should provide powerful support.
To be sure, Americans have historically been less enthusiastic about redistributive
programs than have citizens in most other advanced countries. The last two
decades of rhetoric demonizing welfare recipients and denigrating government
have not helped. The notion of "guaranteed income" has never been very popular,
and the term "welfare" is badly tainted.
Still, a very large portion of the population is distressed and angry about
wage stagnation and job insecurity, and there is substantial concern about
increasing poverty and inequality. Indeed, the American public has always
been considerably more supportive of employment and income-support policies
than politicians and pundits would have us believe. Even in the face of campaigns
for budget austerity, large majorities have consistently favored substantial
(and, in most cases, increased) spending on Supplemental Security Income,
Social Security, Unemployment Insurance, AFDC, and Food Stamps. Large majorities
also favor more government efforts to expand employment and help with job
training.1
Haveman's proposal is vulnerable to demagoguery over the sheer extent of
transfers involved (just as Humphrey savaged McGovern's "demogrant" proposal),
but it has several features that would be quite helpful in rallying public
support. For one thing, it is universalistic. It applies equally to
everyone of given economic circumstances, and its effects change only gradually
as circumstances alter; it does not target special groups in a way that would
offend individualistic liberal values or encourage race-baiting.2Also,
the proposal focuses strongly on job creation and work incentives.
Americans believe almost religiously in the importance of requiring the able-bodied
to work, even if they must be subsidized to do so, and Americans believe strongly
in the right of everyone to have a job that pays decent wages. Furthermore,
the proposal emphasizes the widely-held values of encouraging productivity
and economic growth.
Thus I believe that an Employment-Centered Social Policy, if carefully designed
so that it made many Americans economically better off--and if favorably publicized--could
win broad public support. That is the good news. But policy is not made in
such a purely democratic fashion that what a majority of Americans wants will
inevitably come to pass.
2. Money and organized interests. Money and organized interests matter,
and they present serious obstacles. The problem is not so much that the beneficiaries
of existing income-support programs are likely to rise up and prevent change.
Yes, it would be crucial to leave the Old Age retirement portion of Social
Security essentially intact; Social Security is dear to the general public
and is protected by a well-organized lobby of the elderly, as even Newt Gingrich
seems to have learned. And Unemployment Insurance has some backing from cyclical
industries it subsidizes. But most beneficiaries of current income support
programs--the unemployed, the disabled, welfare recipients, and especially
children--are politically weak and unorganized.
The chief problem is quite different: since the mid-1970s, most U.S. businesses
and wealthy individuals have turned against practically any sort of redistributive
program which would increase their taxes.3 Businesses and high-income individuals provide most of the
lobbyists in Washington and most of the money for political campaigns. They
have substantial influence on policy. Indeed the political power of money
has probably increased in recent years, as corporate and other contributors
have got around legal limitations by giving politicians millions in unregulated
"soft money" or "independent" expenditures. At the same time, business has
increasingly dominated the interest group universe as organized labor has
declined in strength so that it now encompasses fewer than 15% of U.S. workers.
The consequences are profound. It is not merely that the Republican party--traditionally
less friendly to redistributive programs--has gained at the expense of the
Democrats, but that the Democratic Party itself has made a right turn. Robert
Reich's account of the Clinton administration's shift away from its popular
constituency of working class and poor people and toward its money constituency
of investment bankers and multinational corporations is particularly poignant.4
This shift by the Democrats, in turn, has alienated low income people and
further demobilized and politically weakened them, as was evident in the meager
turnout of lower-income citizens in the 1994 elections.
The present configuration of organized interests--with corporate America
politically powerful and nearly all of it hostile--is likely to doom any substantial
pro-worker, pro-poor redistributive proposal, at least in the short run. In
the longer run, progress could be made by building grass-roots organizations
(including new political parties), revitalizing organized labor, trying to
recapture the Democratic Party, and, above all, reducing the power of money
in politics through meaningful campaign finance reform.5
None of this promises to be easy, but it is worth a great deal of effort.
Success would pay dividends not only in terms of jobs and income security,
but also for progressive and democratic politics generally.
My normal optimism flags somewhat, however, in the face of a suspicion that
some of the political obstacles to egalitarian social policy may be rooted
in factors that are very long-lasting and resistant to change: fundamental
trends in international economics.
3. International competition. The causes of increasing poverty and
inequality are subject to dispute. Very likely they include changes in technology,
especially computerization, which have reduced the demand for low-skill workers.
But I believe they also include several aspects of economic globalization:
immigration (which brings in low-skill workers from abroad who compete with,
and lower the wages of, American workers), free trade (which increases imports
of low-wage goods that put pressures on U.S. wages for making comparable items),
and capital mobility (which lets firms threaten to move abroad to low-wage
countries if their workers won't accept downsizings and pay cuts).
But whatever the impact of globalization on poverty and inequality, it plainly
has grave political consequences. By spreading wage competition to
a global labor pool, immigration, free trade, and capital mobility severely
weaken organized labor and make its revitalization difficult. By the same
token, these factors strengthen the political power of multinational businesses.
And capital mobility gives business firms powerful leverage over governments:
if policy does not go their way, they can leave the country. Policy makers
who care about their nation's economic future are increasingly at the mercy
of financiers and businesspeople who can tell them which policies are acceptable.
Governments have to compete with each other to provide the most lucrative
business climate.
In these circumstances, extensive redistributional programs, unless they
clearly enhance productivity (for example by improving education or infrastructure)
are at a severe political disadvantage. An Employment-Centered Social Policy
that is worth pursuing--that is, one with good benefit levels, financed by
progressive personal and corporate income taxes--would increase work effort
but probably not boost productivity enough to prevent capital from fleeing
the taxes. Thus it might well fall victim to an international race to the
bottom in social policy.6
Remedies to this problem would have to be even more far-reaching than the
already-daunting project of curbing the political power of money in the United
States. Solutions would have to be truly global, shifting power from capital
back toward labor on a world-wide scale. They would have to involve such things
as the organization of workers in poor countries, cooperation by labor across
national borders, and the negotiation of international agreements on workplace
health and safety and the environment, which would raise labor costs abroad
and dull the sharpest edges of international wage competition.
Such measures seem to me very much worth working for, so long as they do
not excessively dim the economic prospects of workers in poor countries. But
the magnitude of the task of dealing with international wage competition suggests
just how difficult it may be to enact policies that will provide job opportunities
and decent incomes for all Americans.
1 Fay Lomax Cook and Edith J. Barrett, Support for the
American Welfare State (New York: Columbia University Press, 1992), p.
62; Benjamin I. Page and Robert Y. Shapiro, The Rational Public: Fifty
Years of Trends in Americans' Policy Preferences (Chicago: University
of Chicago Press), pp. 118-129.
2 See Paul M. Sniderman and Thomas Piazza, The Scar
of Race (Cambridge, Mass.: Harvard University Press, 1993); Donald R.
Kinder and Lynn M. Sanders, Divided by Color (Chicago: University of
Chicago Press, 1996), Chap. 8, 9.
3 Thomas Ferguson and Joel Rogers, Right Turn: The Decline
of the Democrats and the Future of American Politics (New York: Hill and
Wang, 1986); Thomas Ferguson, Golden Rule: The Investment Theory of Party
Competition and the Logic of Money-Driven Political Systems (Chicago:
University of Chicago Press, 1995).
4 Robert B. Reich, Locked in the Cabinet (New York:
Knopf, 1997). See also Bob Woodward, The Agenda: Inside the Clinton White
House (New York: Simon & Schuster, 1994), and Ferguson, Golden Rule,
pp. 275-375.
5 See "The Pull of Money: New Directions for Campaign Finance
Reform," Boston Review, vol. XXII, no. 2 (April/May 1997), pp. 3-16.
6 For further gloomy thoughts on this subject, see Benjamin
I. Page, "Trouble for Workers and the Poor: Economic Globalization and the
Reshaping of American Politics," a paper delivered at the annual meetings
of the Midwest Political Science Association, Chicago, April 10-12, 1997.
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