Book Review: Review Essay: Rethinking Welfare and the Politics of Risk

The coronavirus pandemic has profoundly shaken the fundamental paradigms of political economy. In the years to come, we will discover it has changed how we think the economy runs and the role we see in it for democratic governments. Along with the 2008 financial crisis and ongoing climate emergency, it has also prompted a broad rethinking of the way societies manage and allocate risks. As COVID-19 relief efforts poured down in multiple new forms and varieties—from personal checks signed by the president to unprecedented fed-funded business loans and a highly uneven global vaccination campaign—they have forced us to evaluate traditional institutions of relief and aid and to reflect on the very meaning of security and solidarity. None is more prominent than the welfare state itself and its core institution: social insurance.

The political theory of risk, however, has so far remained a more minor and fragmented occupation, one that can be roughly divided into three groups: normative work on chance, responsibility, and moral uncertainty; ¹ historical work on the role of risk in canonical political thought; ² and work on risk as a form of disciplinary power or governmentality. ³ Along with the general neglect of the administrative state, ⁴ this corpus has largely left social insurance a normative and political black box. What are the merits of social insurance for achieving greater equality or buttressing individual liberties? How has social insurance shaped our ideas of welfare, and what is its relation to democracy?

Two books, published during the pandemic, help answer these questions: Rachel Z. Friedman’s Probable Justice, on the political theory of social insurance and probability science, and Caley Horan’s Insurance Era, on the history of the post-WWII private insurance industry in the United States. Friedman and Horan offer deep and detailed dives into the very form of insurance—its mechanisms, evolving theories, attendant values, and contingent local displays, primarily in the United States and Europe. Their books uncover a contemporary political culture long in the making, where actuarial principles are deeply ingrained as measures of fairness, order, safety, and civic standing. More importantly, they reflect the deep divide between social and commercial insurance, despite their shared actuarial heritage.

The two books portray a complex reality. They expose the limits of social insurance as a framework for social justice while emphasizing its enduring significance as a democratic institution. As a progressive strategy, insurance has three major flaws: it is regressive, fiscally conservative, and exclusionary. These make it less appropriate for vertical redistribution than is commonly held. Forward-facing rather than corrective, social insurance promises a more secure future, all the while preserving existing economic conditions and mostly neglecting the deep wrongs of the past. There is a price to be paid, therefore, for failing to identify the distinct features of what Friedman calls “actuarial fairness”—an idea of justice distinct from both distributive and retributive justice.

But Friedman and Horan also offer compelling reasons to see social insurance as a vital democratic institution. As Friedman shows, social insurance is a technique to manage financial commitments over time and to alleviate the unequal harms of misfortune. As such, it has served as the primary site where communities debate their own sense of security and their financial commitments toward the future. Moreover, as Horan’s account details, the expansion of commercial insurance gives this for-profit industry an immense economic and social power through its investments and “actuarial redlining.” The role of social insurance, therefore, is to place hard limits on an otherwise irresistible force for deepening social segregation, exclusion, and discrimination.

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Probable Justice is an intellectual and institutional history of the welfare state, tracing the coevolution of social insurance and probability theory since the late-seventeenth century. Combining a political-theory sensibility and the tools of the history of science, it traces how insurance became our primary model of welfare itself. Its final chapter, however, delivers a surprising plot twist in this otherwise triumphant tale. As insurance came to define many welfare programs in the post-WWII era, its very success laid the seeds to its downfall. Social insurance, especially in the immediate postwar years, was tasked with a mission that was more universal and redistributive than insurance can sustainably be. It has since come under permanent threat of becoming just another fiscal tool. Even worse, having lost much of its “insurantial” character and restraints, social insurance has become an easy target for critique and for defunding efforts. To understand this turn of events and the current crisis of social insurance, Friedman’s book asks what the form of insurance is, how it has evolved, and how it was translated into wide national programs.

The long road to social insurance begins with an ethical dilemma involving chance. What may perhaps seem self-evident today was once a serious conundrum: How can an agreement or contract be fair when its outcome, its winners and losers, cannot be determined in advance? The solution early probabilists like Christiaan Huygens and Jacob Bernoulli came up with in the late-seventeenth century was that, to be fair, each party to the contract must have an “equal expectation” of the outcome. Their model was a game of chance: a game was fair if everyone could equally expect to win, if their chance was proportional to their stake. Put otherwise, the price to “enter the game” multiplies the collective pot by one’s chance of winning it. From its early days, therefore, the problem of probability was “presented as one of distributing a shared resource among mathematically defined equals” (31).

One of the early, though by no means swift, applications of probability theory was in the burgeoning field of life insurance in the eighteenth century. Insurance companies, which had suffered frequent failures, sought more scientific methods to underpin their financial commitments, aided by an explosion in demographic statistics. Another impetus for change was the highly exclusionary nature of existing forms of relief like mutual societies, which selectively offered aid among social peers only. Even worse were government public assistance programs like the English Poor Laws, which subjected the least well off to demeaning “means tests,” oversight, and often harsh mandatory labor.

The earliest adopters of probabilities as a way to manage liabilities were the Society for Equitable Assurances on Lives and Survivorships, or the Equitable, founded in 1762. Designed by mathematician James Dodson—who was himself denied a life insurance policy—the Equitable lived up to its name by adjusting premiums according to average mortality by age (40). If traditional “friendly societies,” as they were known in England, relied on thick social ties, homogeneity, and internal policing, the Equitable represented a new model of broad access and more diverse risk pools.

Probability theory helped insurers resolve technical questions, but it also infused actuarial practice with a fundamental interpretation of “fairness” as a form of equal expectation. Individual contributions, for example, had to reflect one’s relative risk while members’ pooled resources represented broad solidarity. Unlike regular savings, declared the British House of Commons in 1825, which were prudent but self-serving, insurance showed responsibility toward oneself and one’s community, “an act of mutual benevolence,” in the words of French jurist Joseph-Marie de Gérando (59–60). It was also a way, argued moral philosopher Richard Price in 1771, to promote liberal ideals like self-sufficiency, guaranteeing a regular income throughout one’s life (58). Insurance thus signaled a social commitment to level the harmful, highly unequal effects of chance in a mutual, voluntary, and reciprocal agreement. It was also vital in reducing uncertainty and dependency over one’s lifetime.

Probability theory, however, was not always a force for greater equality and inclusion. In fact, quite the opposite. Even as they expanded membership significantly, insurers could still refuse policies to those they deemed of “bad character,” to the unskilled, or to the substantially less fortunate (94). Starting in the mid-1800s, moreover, classical probability gave way to an entirely different approach: frequentism, prominent mostly in England. Unlike the highly individualist, epistemological, even subjective late-classical interpretation of probabilities of Pierre-Simon Laplace or Daniel Bernoulli (69), the frequentist approach rejected the very idea that probabilities were about expectations. For philosophers like John Stuart Mill and mathematicians like John Venn, probabilities reflected objective frequencies of events present in the world. “Risks” were randomly distributed within a given group—its boundaries infinitely adjustable, its members perfectly interchangeable. They were observed and recorded using statistics and were seen as an attribute of the group, not of an individual’s expectation. By extension, a frequentist approach to insurance called for extensive disaggregation of risk groups and a clear preference for intraclass accountability, as opposed to any vertical redistribution or broad-based solidarity. Actuarial fairness was itself changing. It now relied on the individual’s “prior identification with some reference group or class” (106).

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These different chapters in the intellectual history of probabilities and commercial insurance set up Friedman’s main subject: the rise of social insurance as a pillar of the welfare state. What was it about insurance that made it so appealing to idealist social reformers like the marquis de Condorcet and to statists like Otto von Bismarck? Personal responsibility, reliable, mathematically grounded social investment, and the solidarity of risk pooling all made insurance attractive. Insurance served as a new framework for centralized and regulated social provision, replacing models based on charity and dependence.

Condorcet offers an early example of the utopian imaginary behind social insurance. In the 1790s, he proposed a state system of elder pensions, support for widows and orphans, and a capital endowment for children. This rudimentary social insurance was meant to reduce arbitrary inequalities—inequalities that reflected the added risk and uncertainty of wage labor (as opposed to income from property). The scheme was part of Condorcet’s vision of a society geared to individual improvement and flourishing and emphasized the role of general security in allowing each to “manage his household, administer his affairs, and employ his labor and his faculties in freedom” (64).

By the mid-nineteenth century, France led the way in the study of classical probability theory and produced some of the most elaborate theoretical models of social insurance. Alarmed by the devastating new insecurities of the industrial age, both liberal and socialist theorists proposed insurance as a way to improve the lot of workers. Utopian socialist Raoul Boudon, for example, in 1848, called for a “macro” approach to insurance that focused on “average losses” in the entire French economy, not individual ones. Over-classification into minute risk classes, he argued, only increased the administrative burden, whether public or private, while raising premiums for the least fortunate. Disaggregation undermined the basic goal of insurance that was, he wrote, “that all the population of a town will see itself as struck at the same time” (102). In the spirit of reaggregation, therefore, Boudon proposed a state-run-and-backed social insurance scheme that included worker pensions and accident insurance.

Counterintuitively, however, it was not the classical but the frequentist approach to probabilities, as Friedman emphasizes, which made the move from vision to practice possible. Frequentism best fit the new political climate in Europe, where an increasingly powerful labor movement was demanding broad protections for industrial workers. In Germany, the first to set up social insurance in the 1880s, as well as in France, Britain, the United States, and Denmark, social insurance began as a combination of accident and unemployment insurance for workers as well as old-age pensions. In France and Germany, the aim was explicitly political. Insurance sought not only to reward the “soldier of labor,” in Bismarck’s words, but to create a new bond of loyalty between workers and the centralized state, bypassing both employers and unions. The frequentist approach suited these aims. It redefined probabilities as noncausal, partly random, observed patterns within a specified but easily redefined group or class. It rendered workplace risks, for example, systemic and faultless, justifying government compensation. It also spoke to the specific class sentiment and identities of the insured, facilitating a wide range of programs, including many that were financed through the workers’ own contributions.

But turning insurance into a social program also meant extending its core tenets, at times to untenable extremes. First, the liabilities of social insurance go well beyond its current “members” and become the responsibility of future generations. Moreover, social insurance is often mandatory, rather than voluntary, even for present members. Such were the concerns of an early critic of social insurance, Thomas Paine. Paine rejected the insurance model precisely because of its forward-facing nature, binding future governments to promises made today. “Every age and generation,” he argued in 1791, “must be as free to act for itself . . . as the ages and generations which preceded it” (67). Instead, he proposed a form of public provision that was the reverse image of insurance: a backward-facing, redistributive approach that used property taxation, especially inheritance taxes, to fund generous payment programs. These were justified, he argued, as a form of compensation for the destruction of common property and the unequal distribution of privatized land.

The “frequentist” character of social insurance, especially at its inception, also underscores the fragmented, disaggregated, and exclusionary nature of insurance, which makes for an uneasy fit with large national programs. Actuarial fairness and the principle of “equal expectations” rely on a regressive idea of reciprocity, or parity, between contributions and benefits. It also works best within relatively closed, homogenous, and even discriminatory “risk classes.” Even prior to the frequentist turn, classical probabilists like Boudon excluded nonworkers or anyone deemed idle or irresponsible from their national schemes.

In general, social insurance seeks homogeneity and equivalence among the insured: that all shall be equally “risky” and equally worthy of compensation (103–104). British unemployment insurance, for example, enacted as the Labour Exchanges Act in 1909, relied on worker contributions by trade, invoking class solidarity and the sense of an equal vulnerability rather than facilitating wider redistribution (133). While social insurance thus helped to cover “uninsurable” events and populations, early national programs mostly preserved class differences and interests. Indeed, this was the major political appeal of social insurance for elites. And it would be put to an extreme test in the post-WWII era.

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Social insurance today remains a key funding mechanism for social programs and a revenue-raising tool for governments, as insurance surpluses are reinvested in local economies and used to finance government debt. ⁵ It is also widely popular, including its more regressive, highly “insurantial” aspects, like the “contributory principle” (premium-like payments). And yet, despite its unparalleled success in shaping the institutions and public perceptions of the welfare state, social insurance has been under sustained attack in recent decades, suffering very real decline. Replacing a former pro-insurance consensus, the attacks have come from the left—which demands more progressive tax financing—as much as the right, which calls for privatization. ⁶ Both have contributed to the actual defunding and permanent crisis of social-insurance programs.

Friedman’s book offers an additional perspective on these politically motivated critiques. It grounds them, at least in part, in the inherent tensions of the insurance form itself, as it adapted to changing political demands starting in the 1940s. The exclusive, disaggregated nature of actuarial classification has proved challenging for statewide insurance programs, especially those seeking greater equality and more aggressive redistribution. It was the postwar era’s egalitarian turn, Friedman concludes, that put the greatest strain on the insurance model of welfare and its underlying principles of actuarial fairness.

The ambition to make insurance truly universal in reach and grounded in society-wide solidarity was, in a sense, its undoing. This was immediately evident, for example, in Britain, where a persistent gap separated the egalitarian rhetoric of reformers like William Beveridge and the actual policies they enacted, which relied heavily on middle-class funding of working-class claims. It was this tacit, partly concealed reliance on vertical, interclass redistribution that enabled social insurance to work and raised the somewhat justified ire of rightwing critics like Friedrich Hayek (146). The postwar welfare state, as Beveridge admitted, was freed from “the necessity of varying the premium according to the risk or accumulating reserves to fund future liabilities” (143–44). In other words, it freed social insurance from the constraints that make insurance.

The immediate and more visible effects of these postwar trends are cuts to social programs, shrinking beneficiary pools, privatization, and the return of invasive and demeaning means-testing, reminiscent of the Poor Laws of old. Probable Justice helps us see the greater substance of these changes. For one, they have meant a decline in social insurance independence and actuarial discipline. Politicians today enjoy greater leeway in funding and defunding insurance programs and can more easily discount future planning for the sake of present political needs. Contemporary welfare states have also undermined the fundamental reciprocity between payments and receipts, between one member and the other, and intergenerationally, weakening both trust in the system and its public legitimacy. Many of these programs, moreover, are not only financed through general taxation but through government debt, pushing existing obligations yet further into the future, with little to no accountability.

The universalist ambitions of social insurance provide an additional explanation for the erosion of social insurance in the postwar era. It also helps explain the remarkable political success of private insurers during these decades—the subject of Horan’s Insurance Era. As Horan shows, the private sphere allowed insurance principles to thrive, with fewer inner conflicts or frictions. It also allowed these principles to dramatically impact social inequality and racial segregation and to refashion the very meaning of liberal citizenship and values. Insurers’ expansionary ambitions, she demonstrates, fit in well with a changing regulatory environment and a capital-starved economy. The large reserves and surpluses of a well-organized and coordinated private insurance industry made for a formidable investment apparatus that fundamentally reshaped American society.

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The retreat of social insurance in recent decades has gone hand in hand with the rise of private insurance, indeed at its prompting. Focused on the undeniable triumphs of American private insurers in the postwar years, Insurance Era—a social, economic, and cultural history—examines how insurers successfully organized to counter the growing threats posed by regulators and by new social insurance programs. Private insurers, as Horan shows, coordinated their efforts and invested heavily in public-relations and lobbying campaigns. As one of the largest sources of private investment, insurance companies radically transformed the built urban and suburban landscape and the structure of households, businesses, and consumer society. Most importantly, through their campaigns and investments, insurers inculcated specific values in the American public and influenced long-standing patterns of discrimination and exclusion. Often, their efforts also proved fruitful in fending off powerful criticisms and persistent local and national resistance.

As it grew and greatly expanded in the twentieth century, the American private insurance industry faced recurring threats to its reputation and its market share. These included the 1905 Armstrong Committee, which accused the industry of fraud and corruption; Roosevelt’s 1938 Temporary National Economic Committee, which linked it to the Great Depression; and the establishment of Social Security (1935) and Medicare and Medicaid (1965). Managing a gigantic capital reserve and large long-term liabilities, insurers also faced significant market pressures, like inflation, fierce competition, and limited avenues for investment. To recover public trust and ensure economic viability and growth, insurers worked in concert, lobbying for looser regulations and addressing the public directly, through numerous outreach, service, and educational initiatives.

Insurers’ efforts were rewarded not only with waves of deregulation but with an emergent paradigm, a form of “universal” insurance founded on a public-private partnership that directly challenged the statist universalism of social insurance. From the get-go, as Horan shows, the industry successfully pursued a lucrative division of labor: government would provide a floor, covering more vulnerable populations and the least (profitably) insurable risks. Above this floor, private insurers could profit handsomely from the sale of more refined products to a much more selective set of customers. It was never for social insurance and the postwar egalitarian ethos to provide this sought-after universality, “protection for everyone against everything” (1). It was, rather, a task for private insurance, driven by a profit motive.

Insurers organized extensively to make sure that this would be the way universal insurance unfolded. They coordinated far-reaching and expensive advertising and lobbying campaigns alongside public health and education initiatives. Major insurers, like the Metropolitan Life Insurance Company, counseled the American public on good hygiene, diet, and preventative care, even offering an expansive visiting-nurse service (47). Through their main coordinating arm, the Institute of Life Insurance, they mounted more explicit propaganda campaigns, “filling national newspapers and magazines with ‘educational’ copy on . . . how to stretch the family food budget; how to plan future education and careers for children; how to prevent juvenile delinquency, manage debt, and secure marital happiness” (57). Insurers’ public health campaigns, which also served as a massive, not-always-consensual surveillance apparatus, generated large amounts of data on individuals’ habits and physical well-being (48).

The intense deregulation that followed these public campaigns, especially in the 1940s and 1950s, made the industry a truly transformative force as a major private investor (107). Liberated by regulators to engage in more risky ventures, insurers not only began offering loans to households and businesses but built and designed their own “housing developments, shopping centers, office buildings, and infrastructure projects,” completely reshaping urban and especially suburban life (69). Insurance dollars disseminated actuarial principles and values into individuals’ conduct and social relations while exacerbating racial and class segregation. Led by their own investment interests, insurance companies accelerated the movement of capital, white-collar work and business centers to the suburbs.

Both in their urban failures and suburban successes, insurance companies transformed American society. In the cities, where insurers received generous land grants and tax breaks for “urban renewal,” they displaced low-income and diverse communities to make way for a highly regimented, surveilled, and homogeneous living environment. Two such investments were Metropolitan’s monumental, self-contained “utopias”—Parkchester and Stuyvesant Town in New York City—which catered exclusively to white, middle-class families. These and similar investments implemented an actuarial logic in their design, construction, and management. “Nearly every aspect of the building process,” Horan writes,

from selection of construction materials (most were fireproof) to selection of tenants (segregated by race and class), turned on a calculus of risk . . . The architects of these developments intentionally limited entrances and exits, restricting access to outsiders and channeling inhabitants through an open, central area . . . a tightly controlled space in which the movements of residents were strictly monitored—not only by patrolling guards hired by insurance company management, but also by neighbors. (74–75)

Insurers’ influence was even more pronounced in the suburbs, a less volatile, much more profitable investment avenue—with far less local resistance. Malls are a prominent example. As a new form of retail organization, malls owe much of their success, spread, and dominance, as well as their unique design features, to the investments of insurance companies. Here, too, insurers sought utmost control. Malls were remotely located, decentralized, and isolated and were confined to housing “safe” tenants—usually large retail chains with high credit scores. Smaller local businesses were decimated in the process, while entire downtown business districts were deserted.

As Horan duly notes, insurers’ pervasive influence and especially their role in exacerbating discrimination and segregation on a wide scale did not go unchallenged. Activists in the 1940s criticized the industry for its lopsided investment in white, suburban neighborhoods. In the 1960s, they accused it of “insurance redlining,” with the result of denying entire communities, usually low-income communities of color, basic access to insurance products (147). These struggles included organized boycotts, protests, legislation, and even an antitrust campaign. But, aside from isolated victories, such as the 1944 New York City prohibition on racial discrimination in publicly subsidized housing (87), most had failed. In part, they were defeated, Horan argues, because activists conceded the self-justificatory logic of insurers. Insurance companies’ regular response to critique was their claim to actuarial fairness. Their risk classifications, they argued, were objective, neutral, and scientifically grounded. More importantly, they were rooted in the unassailable normative principle that “‘good risks’ should not be made to subsidize ‘bad risks’” (11–12).

Such was the case, for example, in the 1970s and ’80s when the National Organization of Women and other major women’s rights organizations mounted a campaign against gender discrimination in insurance. The campaign culminated in two federal bills, introduced in 1983, which enjoyed wide bipartisan and public support. These quickly eroded, however, following a well-funded and aggressive counter-campaign by the industry. Horan lays at least some of the blame on activists’ “failure to set the terms of the debate” (173). In hindsight, they had forfeited a measure of public appeal when they chose to attack insurers at their own game, criticizing the validity of sex as a risk category rather than insurers’ wholesale rejection of social equality and solidarity. Both bills were defeated within a year.

Between industry organizing, PR campaigns, and unprecedented investment, Horan’s account illuminates the unique public-private partnership that has ruled American social insurance ever since. The 1968 Fair Access to Insurance Requirements (FAIR) program showcases this unique symbiosis. The program was set up as a two-tiered system. Lower-income, “high-risk” households could purchase government-backed “public” insurance from private companies. Others, picked by insurers themselves, would be eligible for the full private plan, usually at lower rates and much better coverage. Participation in the program, moreover, was completely voluntary and left to the discretion of states and local governments. The arrangement was not only lucrative for insurers but helped sustain a thriving market in upgraded products for higher income households. It was, however, severely limited in its ability to increase public access to quality insurance (163–64).

Insurers had dual, contradictory stakes in this division of labor. On the one hand, they sought extensive government support, subsidies, and deregulation. On the other, they “nurtur[ed] a deep and enduring commitment to compete with the state and restrict its expansion” (106). As we evaluate the state of social insurance today, it is important to keep in mind how private insurance in the United States gained its truly transformative social, political, and economic power. This power could not have worked its way through markets and communities without generous collaboration from the government and without the latter’s willingness to delegate its mission of keeping people safe to the private, commercial sphere.

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Probable Justice and Insurance Era highlight the deep social and cultural impact of the insurance form on contemporary capitalist democracies. Insurance—both social and commercial—has shaped not only our notions of safety, solidarity, and responsibility but also the very idea of welfare. First, we have overwhelmingly endorsed the idea that safety is a fundamental human right that must be protected by the state, equating “welfare” with a host of safety-related goods: healthcare, retirement, and unemployment insurance, to name a few. Second, we have come to see “equal expectations” as a fundamental right, one that underpins our broader notion of a “meritocratic” society. This could, narrowly, be our “equal expectation” to succeed with a college degree, for example, or extended to include our very “life chances.”

Indeed, it is a version of equal expectations, Friedman shows, which undergirds one of the most seminal ideas of justice formulated in the late-twentieth century. In an eye-opening section, she discusses John Rawls’s “veil of ignorance”: the hypothetical scenario where different political arrangements are debated (161). A just arrangement, Rawls argued, can only be reached when all are deeply uncertain about the “probable nature of their society, or their place in it” and when all are presumed equally likely to end up on its lower end. Though Rawls had rejected the narrow logic of probabilities, therefore, he actually adopted the deeper actuarial principle of leveling expectations and generously rewarding the less fortunate.

Finally, the insurance form is evident in contemporary politics’ forward-facing bias. Our view of what constitutes well-being privileges future chances and guarantees over remediating past injustices or even correcting present inequities. We want, and value, a future purged of uncertainty: the confidence and security that we will be provided for and that our efforts today will be rewarded tomorrow. This temporal dimension distinguishes the insurance model of welfare from alternative approaches, anchored in the past and present. As with Paine’s example, the alternative would be a backward facing, redistributive interpretation of welfare.

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As a work of political theory, Friedman’s book helps to bridge some of the larger gaps in the current literature on risk and politics, especially the elaborate role of state-governed insurance programs. Alongside Horan’s historiographical work (which joins a growing literature linking the history of capitalism and insurance), ⁷ the two books reveal a wide but uneasy political reliance on an insurance form that is rarely understood in full. Liberal welfare states are founded on the notion that there is a political and social duty to protect individuals’ future. What is usually obscured is the origin of this idea in, and its dependence on, a science dedicated to probabilities, classification, and some fiscal discipline. By now, in the twenty-first century, we are adamant that the welfare state should remedy misfortune—from the accidents of one’s birth to market failures—but are much less vigilant over the methods by which it does so.

The mechanism of social insurance does two main things. First, it carries a commitment forward: a financial commitment of means but also a distributive commitment on how resources will be allocated in the future. These commitments are imposed on those who didn’t assume them, justified by the very tools and rules that insurance uses to fulfill them. Second, insurance presupposes a de facto equality between the members of an actuarially defined group and works to level the actual effects of loss and misfortune. Taken together, social insurance is the primary site where society as a whole decides how to align present income with future need and how to distribute the unequal effects of chance. Importantly, however, it can only achieve greater parity in risk exposure by accepting differential treatment, a regressive funding structure, and fiscal restraints.

To carry a financial commitment over time, moreover, has the necessary “side effect” of building up huge capital reserves in the present. This immense economic force looks very different when it is harnessed to public goals and subject to public scrutiny and when it is left to private hands. In the absence of a robust social insurance program, therefore, well-organized private industry can forcefully emerge to shape public life, values, and social relations with little accountability. The scope of social insurance, therefore, determines the limits of private insurance in ways that ought to inform public debate.

Both normative and critical political theory stand to gain from these new additions to the study of the politics of risk and the administrative state. Normative theory, in particular, ought to heed Friedman’s careful examination of the foundational ideas behind the modern welfare state and the distinction it points to between forward- and backward-facing ideals of justice. Having developed, from the start, as principles of distributive justice, actuarial technologies have fundamentally shaped our moral intuitions and political imagination while eclipsing important alternatives. This is true for normative work on risk, chance, and responsibility but also for work on distributive justice, which more tacitly relies on a notion of “equal expectations.”

For critical theorists concerned, among other things, with renewed forms of invasive “means testing,” surveillance, profiling, and “personal responsibility,” the news of insurance’s regressive, often highly discriminatory nature might not come as a great surprise. Nevertheless, Horan and Friedman help bridge the current gap between the progressive critique of welfare and its ongoing advocacy for new insurance initiatives, like universal healthcare in the United States. On the one hand, the books add an important, often overlooked warning on the limited ability of insurance to promote dramatic wealth redistribution—not only for its fiscal rigidity but for its forward-facing bent. On the other hand, they point to the undeniable resilience of social insurance programs and their crucial role in promoting solidarity, facilitating the democratic negotiation of future commitments, and checking the private power of the insurance industry.

Insurance provides ample means—that enjoy wide legitimacy—to promote the cause of social justice and democracy. But the strength of the insurance form lies in understanding its limits. One conclusion from the two accounts, therefore, must be that insurance cannot remain the single most important sense of safety or of welfare. On a practical level, this means supplementing insurance with programs of a very different nature: backward-facing, redistributive programs, including ones delinked from the workplace and the contributory principle. As I have argued elsewhere, the idea of risk itself extends well beyond the mechanisms of insurance and can be used to assign responsibility (rather than widely diffuse it) and demand redress for the policies that have placed communities in danger. ⁸ For political theorists, the way forward must be to untangle insurance from its many “others,” both institutionally and as a set of values, and to understand the politics of risk as a wide range that runs from exclusion and discrimination to wide democratic solidarity.