The Shadow Welfare State: Labor, Business, and the Politics of Health-Care in the United States

The Shadow Welfare State: Labor, Business, and the Politics of Health-Care in the United States

The Shadow Welfare State: Labor, Business, and the Politics of Health-Care in the United States

The Shadow Welfare State: Labor, Business, and the Politics of Health-Care in the United States


Why, in the recent campaigns for universal health care, did organized labor maintain its support of employer-mandated insurance? Did labor's weakened condition prevent it from endorsing national health insurance? Marie Gottschalk demonstrates here that the unions' surprising stance was a consequence of the peculiarly private nature of social policy in the United States. Her book combines a much-needed account of labor's important role in determining health care policy with a bold and incisive analysis of the American welfare state.

Gottschalk stresses that, in the United States, the social welfare system is anchored in the private sector but backed by government policy. As a result, the private sector is a key political battlefield where business, labor, the state, and employees hotly contest matters such as health care. She maintains that the shadow welfare state of job-based benefits shaped the manner in which labor defined its policy interests and strategies. As evidence, Gottschalk examines the influence of the Taft-Hartley health and welfare funds, the Employee Retirement Income Security Act (E. R. I. S. A.), and experience-rated health insurance, showing how they constrained labor from supporting universal health care.

Labor, Gottschalk asserts, missed an important opportunity to develop a broader progressive agenda. She challenges the movement to establish a position on health care that addresses the growing ranks of Americans without insurance, the restructuring of the U. S. economy, and the political travails of the unions themselves.


This project has disparate origins, some that I can only appreciate as I come to the end of a long journey and ask, how did I end up here? the route seems so obvious as I look back. But it would be disingenuous to say that I knew all along where I was going and why.

In the 1980s, I was an eyewitness to the first wave of economic reforms in China after the Cultural Revolution. Deng Xiaoping and his supporters set out on a long march to smash the iron rice bowl and rewrite the terms of employment for hundreds of millions of Chinese. the so-called reformers sought, among other things, to dispense with lifetime guarantees of job security and greatly reduce state subsidies for housing, medical care, and other key pieces of the public safety net. At the university I was teaching at in the ancient city of Xian in northwest China, the authorities also struggled, with mixed success, to figure out how to build an incentive structure into university education so that the more “productive” professors and teachers would somehow be rewarded for their efforts.

These attempts to rewrite the terms of employment and to change people's expectations about what they are entitled to by virtue of their employment had pervasive political and economic consequences at the local, provincial, and national level. I took a keen interest in these consequences during my two-year stay in China and subsequently. Return visits and newsy letters from friends and former students in China helped keep me apprised of how these macro-level political and economic developments affected everyday life in the People's Republic.

When I returned to the United States, the country was beginning to dig itself out of the worst recession of the postwar years. Employed as a journalist and an editor over the next several years, I noticed that a quieter revolution was under way to rewrite the terms of employment and to reconfigure the social safety net in this country. Even though the economy was roaring once again by the mid-1980s, many workers in the United States were told to shoulder more of the costs of their health care, to make do . . .

Search by... Author
Show... All Results Primary Sources Peer-reviewed


An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.