The United States has the most regressive system of welfare for poor people among developed nations in the twenty-first century, and in recent years it has become even more punitive. The world's self-professed leading democracy lacks a national health care policy, a universal right to health care, and a comprehensive family policy. Welfare applicants are subjected to personal intrusions, arcane regulations, and constant surveillance, all designed to humiliate recipients and deter potential applicants. In recent years there has been a significant decrease in cash grants to the unemployed and underemployed who do not qualify for unemployment insurance. The reorganization of the welfare state began under the Clinton administration with the devolution of federal policies to the states and massive cutting of welfare rolls. The Bush administration, while distracted by September 11 and imperial ambitions, has deepened the cuts and introduced important new policies facilitating access of private organizations to federal grants. The quickly changing economic and geopolitical climate has also generated a profound crisis in the ability of state and local agencies to provide adequate human services to the unemployed and growing ranks of impoverished citizens and immigrants.
Meanwhile, the middle and upper classes enjoy one of the most privileged systems of welfare in the West: a regressive system of taxation; generous government subsidies to business; and employer- and state-subsidized pension and health plans. About two-thirds of the population--some 170 million Americans--are covered by employment-based health plans and over one-third benefit from occupational pensions. "In no other nation," observes political scientist Jacob Hacker, "do citizens rely so heavily on private benefits for protection against the fundamental risks of modern life." This massive system of private welfare depends extensively on government interventions In the form of tax breaks, credit subsidies, and legislative regulations. (1)
From its earliest days, drawing upon the model of the European poor laws in the sixteenth century, U.S. welfare policy has been essentially intimidating and begrudging, "designed to teach a broader lesson to all who observed [its] rituals," notes Frances Fox Piven, "a lesson about the moral imperative of work and the late that would befall those who shirked." The welfare system draws upon racialized and gendered criteria to make distinctions between "worthy" recipients of aid and compassion and "unworthy" exploiters of the public trust. (2)
There have been three main stages in the development of welfare for poor and working people. During the period from the Civil War to the 1920s, the federal government created a postwar pension system that reached more than a quarter of the nation's elderly men. The short-lived, federal Freedmen's Bureau (1865-1872) implemented programs in the South to reverse the ravages of slavery. And in the 1910s and 1920s, states authorized "mothers' pensions" benefits for some fifty thousand widows with children. But these efforts were sporadic and selective, benefiting only a small section of the unemployed and poor. (3)
The creation and expansion of a national welfare system took place between the 1930s and the 1970s, initially as a result of a convergence of interests between a militant labor movement and reform-minded capitalism during the depression, and later as a consequence of the civil rights movement. The New Deal inaugurated old-age insurance, unemployment insurance, workers' compensation, and a variety of public initiatives to alleviate poverty. In the aftermath of the Second World War, millions of returning soldiers benefited from a GI Bill that subsidized education, job training, and housing and family subsidies. In the 1960s, the War on Poverty introduced Medicare, Medicaid, community-based anti-poverty initiatives, and affirmative action programs designed to redress the damage done by decades of racist and sexist employment and educational policies. …