Economic Equality and the Welfare State
Welfare states emerged in times of industrialization and globalization, since then withstood several economic downturns and financial crises, and adapted to profound societal changes. Today, the welfare state is heralded as an economic and social system s
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6.1
Introduction
The modern welfare state is an unrivalled, advanced form of society based on freedom and solidarity, it is the ‘spiritual ideal of Europe’ (Deleeck, 2001). These words of the late Belgian scholar Herman Deleeck perhaps ring hollow to many of us, since over the past few years we have been barraged with doomsday messages on the pervasive effects of rising inequalities across the globe. Even predictions of the ‘end of the welfare state’ surfaced multiple times over the past decades (Gornick, 2001; Svallfors & Taylor-Gooby, 1999). Still, a chapter on the welfare state in a book on equality is well-deserved. Welfare states are amongst the best performing countries in terms of economic and social progress. Citizenship in welfare states is premised on a ‘kind of basic human equality’ that guarantees each and every one a decent minimum standard of living, according to the sociologist W. Van Lancker (B) · A. Van den Heede Centre for Sociological Research, University of Leuven, Louvain, Belgium e-mail: [email protected] © The Author(s) 2021 F. Levrau and N. Clycq (eds.), Equality, https://doi.org/10.1007/978-3-030-54310-5_6
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T. H. Marshall in 1949. Not that such ideal of basic human equality has been fully achieved, as we shall see later in this chapter. Yet, the welfare state is heralded as an economic and social system that is superior to other forms of social organization in ensuring economic equality amongst its citizens while maintaining an ever-increasing living standard. The term welfare state allegedly originated in Britain in the 1940s and since then it has been used to characterize a set of countries that share similar characteristics. Although the precise definition of the welfare state is still a matter of debate, which we will not revisit here (Greve, 2015), it is commonly acknowledged that ‘established’ welfare states are rich, capitalist democracies in which at least some of the responsibilities for providing welfare to citizens is transferred to the state. In providing welfare for all, welfare states redistribute incomes directly, usually by means of progressive taxation, government transfers and the provision of services. As a consequence, established welfare states are also countries in which taxes and levels of public spending are usually quite high: a certain financial capacity is necessary to meet the needs of the people (Wilensky, 1975). Because the living standard and welfare of citizens in these countries are high, a higher tax burden is usually well supported (Benabou, 2000; Persson, 1995). At the same time, welfare states don’t contradict capitalist market principles to deliver goods and services but rather modify and correct these market forces. By establishing labour market legislation and setting minimum wages, for instance welfare states affect the distribution of incomes even before redistribution takes place. In the scientific literature, this is often referred to as ‘welfare capitalism’ (Esping-Andersen, 1990). Despit
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