The Welfare State: Its Benefits and Different Elements
1. Introduction
The term ‘welfare state’ is used to describe a form of government in which the state takes responsibility for the welfare of its citizens. There are different models of the welfare state, but all share the same basic features: a commitment to providing certain minimum standards of living for all citizens, regardless of their income; and the use of tax revenue to fund social welfare programs.
The United States is often said to have a ‘weak’ welfare state, in comparison to other developed countries. This is because the US has a relatively small social safety net, and relies heavily on private provision of social welfare services. However, it is important to note that the US does have a welfare state, albeit a smaller and less comprehensive one than most other developed countries.
2. The American welfare state
The American welfare state has two stages. The first stage began with the establishment of social insurance programs like Social Security and Medicare during the New Deal era of the 1930s. The second stage began in the 1960s, with the expansion of these programs and the introduction of new ones, like Medicaid and food stamps. Together, these two stages form what is known as the ‘American welfare state’.
2. 1. The first stage of the welfare state
The first stage of the American welfare state began with the establishment of social insurance programs during the New Deal era of the 1930s. Social insurance is a system in which workers make regular contributions into a fund, which is then used to provide them with income in retirement or if they become unemployed or sick. The two main social insurance programs in the US are Social Security and Medicare.
Social Security is a federal program that provides financial assistance to retired and disabled workers, as well as their spouses and dependent children. It is funded by payroll taxes levied on workers’ incomes. In 2018, around 62 million Americans received benefits from Social Security.
Medicare is a federal health insurance program that provides coverage to seniors and some disabled Americans. It is funded by payroll taxes, as well as premiums and other out-of-pocket payments from beneficiaries. In 2018, around 58 million Americans were enrolled in Medicare.
2. 2 The second stage of the welfare state
The second stage of the American welfare state began in the 1960s, with the expansion of existing social insurance programs and the introduction of new ones. The most important new program was Medicaid, which provides health insurance to low-income Americans. Other important programs introduced during this period include food stamps (now known as SNAP) and Head Start.
Medicaid is a means-tested program that provides health insurance to low-income Americans. It is jointly funded by federal and state governments, with each state setting its own eligibility requirements within broad federal guidelines. In 2018, around 74 million Americans were enrolled in Medicaid.
Food stamps (now known as SNAP) is a program that provides financial assistance to low-income households to help them buy food. It is administered by the US Department of Agriculture (USDA) and funded through general taxation revenues. In 2018, around 40 million Americans received benefits from SNAP.
Head Start is a program that provides early childhood education, health care, and nutrition services to low-income children and their families. It is administered by the US Department of Health and Human Services (HHS) and funded through a combination of federal and state government funds, as well as private donations. In 2018, around 1 million children were enrolled in Head Start.
3. The benefits of the welfare state
The welfare state provides many benefits to citizens. Firstly, it improves living standards by providing basic needs like income, health care, and education. Secondly, it reduces poverty by providing financial assistance to low-income households. Thirdly, it provides security in old age by giving retired workers an income.
3. 1. Improving living standards
The welfare state improves living standards by providing basic needs like income, health care, and education. For example, Social Security and Medicare provide income and health care to retired and disabled workers, while Medicaid provides health insurance to low-income Americans. Food stamps (now known as SNAP) provide financial assistance to low-income households to help them buy food, and Head Start provides early childhood education to low-income children.
3. 2. Reducing poverty
The welfare state reduces poverty by providing financial assistance to low-income households. For example, Social Security and Medicare provide income and health care to retired and disabled workers, while Medicaid provides health insurance to low-income Americans. Food stamps (now known as SNAP) provide financial assistance to low-income households to help them buy food, and Head Start provides early childhood education to low-income children.
3. 3 Providing security in old age
The welfare state provides security in old age by giving retired workers an income. Social Security is a federal program that provides financial assistance to retired and disabled workers, as well as their spouses and dependent children. It is funded by payroll taxes levied on workers’ incomes. In 2018, around 62 million Americans received benefits from Social Security.
4. Different elements of the welfare state
The welfare state has three different elements: social assistance, social insurance, and tax-based provisions.
4. 1 Social assistance
Social assistance is a system in which the state provides financial assistance to citizens who are unable to support themselves. This can take the form of direct payments, like cash benefits or food stamps, or indirect payments, like subsidized housing or free healthcare. Social assistance programs are typically means-tested, which means that only those with low incomes are eligible for benefits.
4. 2 Social insurance
Social insurance is a system in which workers make regular contributions into a fund, which is then used to provide them with income in retirement or if they become unemployed or sick. The two main social insurance programs in the US are Social Security and Medicare.
4. 3 Tax-based provisions
Tax-based provisions are government programs that are funded through taxation. The two main tax-based social welfare programs in the US are Medicaid and Head Start.
5. Conclusion
The welfare state provides many benefits to citizens, including improved living standards, reduced poverty, and security in old age. It has three different elements: social assistance, social insurance, and tax-based provisions.