Moving towards Social Democratic and Conservative Models of Governance

Esping-Andersen places the structures and processes of resource provision within different forms of the capitalist welfare state.182,183 Three forms – social democratic, conservative, and liberal – differ in how and the extent to which they provide economic and social security. Key aspects of these forms of the welfare state are the extent of stratification, decommodification, and the mix of state, market, and family resource provision. Note that the terms liberal and conservative in the welfare state literature have a very different meaning from their common usage in American politics. Liberal welfare states are the least developed and the conservative and social democratic welfare states are more developed with many similarities. 184

Liberal welfare states provide the least economic and social security. Liberal welfare states (e.g., Canada, the UK and USA) provide modest benefits that the state provides when the market fails to meet citizens’ most basic needs Their political and social history is one of dominance by business interests resulting in the population relying on the employment marketplace rather than the state as the source of economic and social security. A key feature is use of means-tested benefits and lower social expenditures accompanied by generally lower tax rates.

The social democratic welfare states (for example, Finland, Sweden, Denmark and Norway) emphasize universal welfare rights and provide generous benefits and entitlements. Their political and social history is one of political dominance by social democratic parties of the left, a result of political organization initiated by industrial workers and farmers that later came to include the middle class. 185 Through universal provision of a range of benefits, these states have historically secured the loyalties of a significant proportion of the population. The strong influence of organized labour contributes to the stability of the social democratic welfare state by moderating the influence of the business sector on public policymaking. Their key feature of this welfare state is greater social expenditures – possible through generally higher taxation rates – that provide universal benefits across the life-course.

The conservative welfare state (for example, Belgium, France, Germany, the Netherlands and Switzerland) also offers generous benefits but does so through social insurance plans based on employment status.182,183 Emphasis is on supporting the primary wage earner, usually male. Their political and social history is one of political dominance by Christian Democratic parties where traditional Church concerns with maintaining the family merges with conservative upholding of status differences among citizens. These tendencies sometimes manifest in corporatist approaches (for example, Germany) where business interests are major influences or Statist approaches (for example, France) where the State plays a key role in provision of citizen security. 186

Bryant and Raphael 4 among others 185 show how stratification is greater and decommodification -- the ability to live a decent life outside of having paid employment -- is lower in liberal welfare states such that the quality and equitable distribution of the social determinants of health in social democratic welfare states are clearly superior to what is seen in liberal welfare states and somewhat better than those of conservative welfare states. This is so since liberal welfare states have the market as its central institution and its ideological inspiration is one of limiting state interventions in the market economy. 12 As a result, the health-enhancing features of collective employment bargaining coverage and universal benefits of the social democratic and conservative welfare states are for the most part absent in liberal welfare states.

How apparent are the effects of these differences upon societal health and well-being? In one analysis, a Society index made up of measures of poverty, income inequality, intergenerational income mobility, gender wage gap, immigrant wage gap, racial wage gap, income of people with disabilities, voter turnout, jobless youth, life satisfaction, social network support, homicides, burglaries, and suicides, finds the social democratic nations of Norway, Denmark, Sweden, and Finland ranking 1st, 2nd, 3rd, and 5th, while Canada ranks 13 of 26 comparison nations with the UK ranked 17th, and USA 26th 187 On an index of Social Justice for Organization for Economic Cooperation and Development nations consisting of measures of poverty, education, the labor market, intergenerational justice, health, and social inclusion and nondiscrimination, Norway, Denmark, Sweden, and Finland score 2-5 (Iceland scores 1) while the liberal nations score lower: UK (11th), Canada (12th), and USA (36st). 188

We see two dominant critiques of this welfare state approach in the literature. The first is concern with the validity of the classification of nations into these types. While there is certainly valid debate concerning the placement of nations such as Belgium, Switzerland and the Netherlands, there is good evidence for the validity of the liberal and social democratic welfare states. Of the 12 welfare state typologies identified by Bambra, in six of the seven that have included Canada, Canada is found in the group similar to the so-called liberal welfare state: liberal, basic security, or liberal Anglo-Saxon. 189 The USA is so placed in 8 of 8 and the UK in 7 of 10. The Nordic nations are placed consistently in the social democratic, encompassing, Nordic, or services groups: Finland (8 of 11), Denmark (9 of 11), Sweden (12 of 12), and Norway (12 of 12).

The second issue is the presence of differences in health among the different forms of the welfare state. Reviews usually find that social democratic welfare states produce smaller absolute health inequalities and better overall population health.6,190–194

Muntaner and colleagues find that social democratic regimes fare best on absolute health outcomes. 195 McCartney et al. and Bambra conclude, respectively:Social democratic welfare states, higher public spending, fair trade policies, extensions to compulsory education provision, improved access to health care, and high-quality affordable housing have positive impacts on population health… Several authors have found that Nordic welfare states tend to have lower overall mortality rates than do other European types, but greater health inequalities. However, this is not the case if inequalities are measured via life span variation. 196 (p. e1-2)Social-democratic welfare states, which had the lowest overall levels of social inequality, also tended to have better health outcomes for those at the top and those at the bottom of the socioeconomic ladder: more equal countries almost always do better in social and health outcomes.. And despite the fact that some of the liberal welfare states, like the UK and Canada, had robust, well-funded universal healthcare systems, these countries joined the other members of the liberal world in having especially large and intractable health inequalities, resulting from large and intractable socioeconomic inequalities.” 134 (p. 81)

Liberal nations perform especially poorly in what is usually seen as a sensitive measure of population health, infant mortality rates. The social democratic welfare states of Finland, Norway, and Sweden are ranked in the top five of 36 OECD nations with Denmark being just out of the top 10 with a rank of 11. The liberal welfare states of Canada, UK, and USA are all ranked 25th or below with Canada (30th) and the USA (32nd) doing especially poorly. 197

Berkowitz198,199 provides elegant arguments for moving towards such forms of governance as do others.5,7,57 What would be needed to move towards alternatives to liberal models of governance? Raphael shows how the distinctive social democratic and conservative welfare states have developed due to central state rather than federal governance, significant left-party support, high union densities in the social democratic welfare states and high employer-supported collective agreement rates in conservative nations, and proportional representation in the electoral process rather than the first-past-the-post system. 200 In regards to a left political party, the USA does not have one, and the erstwhile social democratic parties of Canada – the New Democratic Party – and UK – Labour -- have long abandoned any critique of neoliberal capitalism 166 making movement towards alternative forms of welfare states unlikely. Additionally, the embrace of neoliberal approaches to governance across all nations suggest that even these alternative forms of the welfare states are not sustainable, requiring envisioning post-capitalist social futures.201–208