Creating a capital investment welfare state: The new American exceptionalism - 1998 Presidential address

In the pastfew decades forces such as;globalization and international compe tition, rising public budgets, and aging populations have caused many natio ns to reexamine the social programs they established at least a half centur y ago. Some nations have cut spending, others have reorganized priorities t o provide support for dual-earner families, single mothers, or elderly peop le who need long-term care. The United Stares appears instead to be in tran sition from a social insurance welfare state to a "capital investment welfa re state " in which the objective is to increase savings and investment. Th is shift in U.S. public policy is most explicit in the ascendance of a neoc onservative ideology, which depicts the welfare state as an impediment to a free market. This ideology has lent credence to proposals for privatizing Social Security and is implicit in seemingly minor technocratic changes in Medicare, which nonetheless have inserted market principles into a social i nsurance program. Whether current trends represent the most recent manifest ation of American exceptionalism or a concurrent restructuring across natio ns can be determined only by comparative research examining (I) how differe nt nations are responding to contemporary fiscal pressures, and(2) if natio ns are redistributing the social welfare burden from the public to the priv ate sector.