The Welfare State Crisis and the Transformation of Social Service Work

By Michael B. Fabricant; Steve Burghardt | Go to book overview

2 • The Political Economic
Framework of the Welfare
State Crisis

Introduction

The previous chapter identified how serious the United States economic crisis is today. It also made clear the fact that the state is integral to the development of solutions to this crisis. It is equally apparent that the overwhelming majority of social service employees are employed directly or indirectly as welfare state employees, either as public workers or through public contracts and grants administered by not-for-profit agencies. Given these late-twentieth-century developments, social workers and other welfare state professionals need to understand how the state functions in relation to the broader economy so they can act more effectively to advance both their own interests and those of clients.

In order to frame the content in which agency practice dynamics emerge, this chapter addresses two central issues of the welfare state debate. First, we believe it is important to situate the agency within the broader framework of the welfare state and its relationship to the political economy. This larger framework is necessary if the changes in agency functioning that we describe in chapter 3 are to be fully understood. In that chapter, for example, we illustrate how social workers in health settings are constrained in their practice decision making by Diagnostic Review Groups (DRGs), introduced in the early 1980s. The emergence of DRGs, however, occurred while the welfare state engaged in across-the-board cost cutting in response to a crisis of profitability in the capitalist economy that had begun a decade earlier. Despite the pressures for cost cutting, Medicare entitlements won by senior citizens from the state in the 1960s have for the most part been

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