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Building the Welfare State Is About Building Democracy

The welfare state has always been a site of struggle, with liberals and conservatives offering technocratic or paternalistic visions — and leftists insisting on more democratic, more emancipatory horizons.

Otto von Bismarck (1815–1898) addressing the Reichstag circa 1880. (Hulton Archive / Getty Images)

Today, we associate the welfare state with the Left. But that connection has not always been so clear. The welfare state has been a site of intense political struggle between competing visions of political life, with conservatives’ paternalistic and liberals’ technocratic versions of the welfare state seeking to supplant the Left’s democratic ideals. Still, history suggests that even where welfare reforms are advanced to secure the status quo, the Left can exploit them to build working-class power and democratic movements.

The first modern, nationwide social welfare laws were passed under Otto von Bismarck, the autocratic chancellor of late-nineteenth-century Imperial Germany. Taking aim at what was then the largest, most powerful socialist party in the world, the German Social Democratic Party, Bismarck attempted to use the welfare measures (health insurance, accident insurance, disability insurance) to arrest the socialists’ growth and prevent the deepening of German democracy.

Bismarck’s turn toward the welfare state presented the socialists with a dilemma. They knew Bismarck’s welfare laws were intended to destroy them. Bismarck was convinced that most workers were committed monarchists, loyal to the existing order, and that if workers’ hardship was removed, the fires of socialism would abate.

Yet Bismarck’s welfare laws also created new opportunities for socialists to mobilize. As SPD leader August Bebel wrote to Friedrich Engels, the laws had opened up “possibilities for agitation.” And agitate the SPD did. In the run-up to the 1884 election, the socialists managed to organize more than a thousand furtive meetings, despite an official ban on such gatherings. The assemblies — ostensibly designed to educate workers about their rights under the new laws — so alarmed the German authorities that Berlin’s chief of police wrote to the interior minister, warning him that they could be the beginning of a revolution.

Several decades later, the social-democratic parties that took power before and after World War II were confronted with a different problem. Mainstream social democrats had sworn off challenging capitalism — their aim was to deliver a larger piece of the growing pie to workers through an expanded welfare state and full employment policies. That project rested on an uneasy tension: business had to be assured that its prerogative would prevail at the end of the day, even if workers were enjoying material gains. The Social Democrats were left to try to secure the participation of workers in capitalism within the context of a mixed economy.

Rather than pacifying workers, however, welfare institutions threw open greater horizons for democratic mobilization and egalitarian change. Full employment policies strengthened workers’ hand at the expense of their bosses; welfare state provisions removed the whip of market forces. This, in part, explains the ferocity of the capitalist counterattack that began in the 1970s, when profitability declined and the economic conditions that sustained the postwar class compromise came unglued.

To see such possibilities, however, we have to challenge the common liberal image and narrative of the welfare state. The most common liberal framework focuses on “social rights,” an idea solidified by the British sociologist T. H. Marshall. Marshall argued that the postwar welfare state embodied an expansion of the logic of liberal citizenship. At first, according to Marshall, liberal citizenship meant legal rights to protection from the state. Next, in the nineteenth century, came the great movement toward political inclusion and equal voting rights. And, finally, the capstone: the full flourishing of the egalitarian promise of citizenship, with social rights providing the economic security and equality necessary to realize the promise of liberalism.

This story is a comforting myth. It imagines the welfare state as resting on a broad national consensus about belonging and citizenship, rather than as part of open-ended political combat. Yet many postwar radical critics of the welfare state, understandably skeptical of this optimistic liberal narrative, responded with a mythological narrative of their own. Influenced by post-structuralist scholars like Michel Foucault, they presented the crowning achievements of liberalism as nothing more than a new, more insidious form of power. While it might seem like the welfare state responds to people’s needs and concerns, it actually builds up new, technocratic methods of governing populations and reshaping individuals’ behavior.

These two myths share much in common. Both imagine the history of the welfare state as a relatively seamless expansion of government powers, only disagreeing about whether that expansion was good or bad. Both downplay, if not completely ignore, the overlapping social movements that often forced authorities to expand social provisions. They also ignore the hopes of activists within those movements that new welfare institutions could foster further political mobilization, deepening democracy in society and the economy.

Take Bismarck’s Germany again: one outgrowth of the chancellor’s welfare laws was a health insurance system administered by elected boards. By 1902, the SPD estimated the party had more than a hundred thousand members or supporters on the boards, making them an usually democratic institution within imperial Germany. The socialist leader Paul Umbreit argued that the German welfare state should “call on and organize workers themselves as the most knowledgeable interpreters of their own wishes and demands.” The penetration of the socialists into the health care system so alarmed German conservatives that they began demanding a crackdown on the so-called “domination of the SPD.”

The history of American social policy also reveals glimmers of a democratic welfare state. Among the most interesting case is the “Community Action Programs” of the 1960s “War on Poverty.” Unfairly maligned at the time and virtually forgotten today, they were remarkable experiments in democratizing the welfare state.

The Community Action Programs were community welfare programs established by the 1964 Economic Opportunity Act that, as the statute put it, had to foster the “maximum feasible participation” of the programs’ beneficiaries. As with Bismarck’s welfare laws, the intention behind this call for participation was by no means straightforwardly democratic. As historian Stuart Schrader argues, elites of the decade saw community participation as a pacification and even counterinsurgency tactic to resist supposed communist agitation. Many liberal supporters also saw the Community Action Programs as a way to discipline workers and the poor. Managing their own welfare would teach the poor sound financial practices, the lack of which was supposedly behind their circumstances.

Things did not go according to plan. The Community Action Programs became hubs of radical organizing, with anti-poverty activists rubbing shoulders with the burgeoning Black Power movement. As the community welfare programs radicalized, panic about the War on Poverty spiked, prompting president Lyndon B. Johnson to pivot toward the war on crime (an important origin for America’s mass incarceration crisis). Yet these programs were generally successful, both in terms of delivering anti-poverty services and in creating new bases for democratic mobilization in America’s cities.

What lessons can the Left draw from these episodes? Most simply: the welfare state is good for democracy, but only when there are robust, emancipatory movements that can use welfare institutions to expand democracy. In each case, the Left successfully deployed an “insider-outsider” strategy, maintaining one foot outside the state and using its participation in state institutions to enhance its capacity to mobilize the public around new goals.

Today, socialists and progressives are using precisely that strategy to push for policies like Medicare for All. There’s always a danger that such campaigns will narrow the Left’s political horizon, mistaking the means for the end goal. But history also indicates that the struggle for a fuller democracy requires a give and take between immediate demands and long-term horizons — and the welfare state can play an important role in bridging the present and the future.