Value Problems of Welfare-Capitalism

Abstract

Welfare Capitalism, a phrase coined by the politician Richard Crossman in 1952, can be understood as a specific phase in the evolution of capitalism. Such a tendency can be traced from the 1940’s, a period in which the term ‘socialism’ began to be replaced with ‘welfare’. In this classic paper, Marshall argues that the second half of the 20th century was marked by the appearance in the western countries of a new and special structural type of society that combined within itself three components – capitalism, welfare and democracy. Marshall’s contribution is the addition of democracy as an independent third party to the previous construct of ‘welfare-capitalism’. He characterises this compound or hybrid type of society with the term “hyphenated society”. Its components are based on different principles, or values, and its main problems derive from that fact that these values cannot be combined fully and harmoniously. The article looks to shed light on how in deciding policy, key contradictions can arise. The author demonstrates these incompatibilities in a series of examples both on the macro-political level of decision-making in social policy and on the micro-level of the individual. These incompatibilities are treated as a constant potential source of conflicts. What is revealed are changing concepts of poverty related to ideas of ‘relative deprivation’ and the increasing interpretation of poverty and inequality being very separate issues. The failure to respond to such issues can be seen as reflecting a weakness in democratic systems. Yet the real danger for hyphenated society, author maintains, is not that type of value conflict between its components but the elimination of any of its three constituent components from its structure. As such, the ‘end of ideology’ has proven premature; conflict over ideas and directions are still visible and must continue to survive if such mixed systems are to remain distinct from more authoritarian and bureaucratic systems.