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Steve Beda, review of Klein, For all these Rights

Page history last edited by PBworks 12 years, 3 months ago

 

Steven Beda

HIST 590

Professor Margaret O’Mara

March 6, 2008

 

REVIEW

 

Klein, Jennifer.  For All These Rights: Business, Labor, and the Shaping of America’s Public-Private Welfare State.  Princeton: Princeton University Press, 2003.

 

            The United States is unique among industrialized nations in that its social welfare is dispensed through a combination of both public and private institutions.  Working adults “earn” healthcare and pension benefits from voluntary employer-based programs while the poor and indigent are (inadequately) provided for by the state.  Jennifer Klein’s For All These Rights tells the story of how we ended up with this peculiar “public-private welfare regime” and suggests new ways of thinking about the relationship between private businesses and the state.[1]  From 1910 through the 1960s, Klein argues, job-based private welfare systems developed and expanded in tandem with public welfare policies.  Rather than acting as obstacles to the welfare state, then, private institutions actually helped shape the course and content of the welfare state.  This all suggests that the public and private aspects of America’s welfare system cannot be understood independently, and any history of the American welfare state “must be told within the context of the century-long story of welfare capitalism.”[2]

            Because Klein would like us to be thinking about more than just the state when we discuss the welfare state, she naturally has some issues with the institutionalist approach and its almost exclusive focus on government structures. While she of course has her fair share of discussions about the composition of governmental bodies and includes many details about government bureaucracies, Klein presents readers with more than enough evidence of private business’ role in welfare state formation to suggest that we need to move beyond the limited scope of the institutionalist framework.  Moreover, Klein finds that the instiutionalist approach “tends to obscure nonstate power relations.”[3]  Accordingly, her narrative makes plenty of room for social movements, mass politics, and organized labor.  Finally, Klein’s source material—the records of private insurance agencies and health care providers, unions, and state bureaucracies—reflect her commitment to show that the American welfare state was the product of more than just public institutions and public policy makers.

            Klein’s narrative is predominantly focused on the first half of the twentieth-century.  This periodization allows her to chart continuities in the attitudes of private welfare providers and show that the brand of welfare capitalism that emerged in the Progressive era would shape ideas about welfare, workers, and the state for decades to come.  In many ways, Klein’s story of early-twentieth-century welfare capitalism, which she begins in 1910, has been told many times before: employers in Progressive-era America assumed some obligation for their employees’ well-being as a way to stave off worker discontent and organized labor.  But Klein’s contribution to the historiography of this era is her detailed attention to life insurance and disability insurance firms, which she clearly sees as important since, in her estimation, they “laid the foundation for the modern system of private, employment-based social welfare.”[4]  Employers adopted the group insurance plans of private firms like Equitable Life and Metropolitan Life in the hope that productivity and profits would improve alongside employees’ standard of living.  But more than that, employers and private insurance firms alike believed that by taking at least a minimal interest in employees’ well being, a large regulatory welfare state could be avoided.  While New Deal policies would pose some problems for private businesses committed to a minimalist state, employers remained committed to the idea that private welfare could inhibit the growth of public welfare.

            To be sure, the Depression and the New Deal did create a new era of industrial relations based in collective bargaining, but Roosevelt’s policies, according to Klein, did not “significantly alter the development of private-sector benefits.”[5]  Where other historians, then, have incorrectly assumed that New Deal policies repudiated private welfare schemes, Klein shows that no such thing occurred.  In fact, Klein maintains, public and private welfare regimes became more tightly intertwined in the 1930s and 1940s.  New Deal welfare policies were not nearly as expansive as they could have been, and this left the door open for supplemental insurance policies provided by private companies.  Especially after the passage of the Social Security Act, private welfare firms restructured their plans to work in conjunction with public welfare policies and went to great lengths to convince workers and policy makers that private supplemental coverage was a necessity.  “Business executives had neither wanted nor created the Social Security Act,” Klein concludes, but they ultimately devised a “way to live with it.”[6]     

            Klein wisely extends her analysis of the New Deal to account for the ideological underpinnings of welfare policy formation and reiterate her main point that employers and private interests crafted private policies to avoid a regulatory state.  Even the New Deal’s rhetoric of “security” was adopted by private insurers as a way to shift the emphasis away from the state and towards private firms. In 1944, for instance, the Great-West Life Assurance Company consciously used Roosevelt’s “Four Freedoms” in their advertising campaigns to “capture the political resonance” of the New Deal and “link it to commercial enterprises and the marketplace.”[7] 

            The New Deal, however, did create a new sense of working-class entitlement, and in the wake of World War II workers, according to Klein, did have the opportunity to transform “employer gratuities into employer rights.”[8]  But, Klein argues, organized labor was never able to capitalize on these opportunities despite the fact that it opposed employer-based health insurance and advocated for a national health care plan.  Looking at a good deal of collective bargaining agreements signed in the postwar era, Klein concludes that the balance of power in the postwar era had tipped in management’s favor.  Private insurers and employers were therefore able to politically outmaneuver organized labor, expanded their supplemental health care coverage, and fend off a national public healthcare plan.  This is an acute rereading of the supposed “labor-management accord” of the 1950s and 1960s that labor historians would be wise to pay attention to.  Where other scholars have seen the expansion of health coverage for organized workers as evidence of harmonious labor-management relations, Klein sees these healthcare plans as evidence of labor’s relative powerlessness.  Unionized workers in the postwar period may have had more benefits, but the programs they really wanted were never instituted and they were forced to accept management’s dictates.

            Furthermore, the public-private welfare state that emerged in the decades after the New Deal exacerbated gender and racial inequalities.  Since health insurance was tied to employment, and moreover unionized jobs, white men received more coverage than nonworking family members, African-Americans, women, and non-unionized workers.  As Klein concludes, the welfare capitalism of the postwar era “created islands of security within the economy, and high waters all around.”[9]

            While Klein does pay a good deal of attention to race and gender throughout her narrative, she often treats them as a secondary concern and she may have done more to explain how the pervasiveness of racism and patriarchy undergirded the formation of the public-private welfare system.  The fact that the state did not expand health care coverage in the New Deal and postwar periods, for instance, may have been due to the fact that men’s work, as opposed to women’s work, was seen as central to the economy.  Since white men were covered by private supplemental insurance, public policy makers may have felt little political or economic need to craft plans for women.  Similarly, since African-American labor was not seen by policy makers as central to the economy, the same point could be raised.

            Despite these minor objections, Klein’s work is an invaluable asset for understating how and why we have the public-private welfare system we do today.  Welfare capitalists, Klein shows, have always been fearful of a powerful central state and they have always crafted welfare schemes to avoid it.  They have outmaneuvered (and sometimes cozied up to) public policy makers and organized labor, and they have expanded their coverage when the political atmosphere dictated that they do so.  But their concern to limit the states’ involvement in regulating labor-management relations has remained more or less constant.  Given present-day debates about Social Security and health care coverage, Klein’s work should be required reading for anyone concerned about the nature and future of our public-private welfare system.      



[1] Jennifer Klein, For All These Rights: Business, Labor, and the Shaping of America’s Public-Private Welfare State (Princeton: Princeton University Press, 2003), 2.

[2] Ibid.

[3] Ibid., 9.

[4] Ibid., 53.

[5] Ibid., 52.

[6] Ibid., 115.

[7] Ibid., 212.

[8] Ibid., 6.

[9] Ibid., 257.

 

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