Abstract
Lane Kenworthy has written a courageous defense of social democratic economic policies in Social Democratic Capitalism (henceforth SDC). Relying on a Rawlsian argument, Kenworthy shows that Nordic economic policies have generated positive outcomes on just about every cross-national quality-of-life metric.
By Kenworthy’s math, Finland, Norway, and Sweden have more freedom, economic growth, upward mobility, happiness, intact families, civic participation, personal income, better health, and less debt than just about any other country in the West. He also shows, sometimes using an index of welfare spending in place of these three countries, that common objections to the good society thesis have little empirical basis. Kenworthy illustrates this using dozens of scatterplots, line graphs, and charts (I counted 170!), all of which are explained in plain language. While there are a handful of these that one might quibble with (he compares Manhattan rents against those of Stockholm instead of using all five boroughs), for the most part, Kenworthy makes these points convincingly.
Those following the 2016 presidential campaign of Bernie Sanders will find the argument familiar. Sanders also wanted to raise taxes to pay for a single-payer health care system. He also wanted to increase the minimum wage, invest in infrastructure, reduce wealth inequality, and create a universal basic income. Sanders was popular, but Kenworthy argues that these policies can also be reasonable. Nordic countries are committed to a balanced budget, using Keynesian economic principles. This generally means spending money when the economy is doing poorly and cutting when the economy is doing well.
But in recent decades, both Republicans and Democrats have tended to spend money no matter what the economy is doing. Using different sets of narratives, these two parties have delivered taxpayer money to pharmaceutical companies and military contractors to the point where the national debt is now over $31 trillion. There are over 37 million people living in poverty. Median black wealth is one-tenth that of whites. One in four Latinos are without health insurance. Annual opioid deaths recently topped 100,000. Homicide in Los Angeles is at a 15-year high. And America’s foreign adversaries grant no reprieve.
The United States is not a good society for most. But how do we afford these programs with our preexisting conditions? Kenworthy is convincing in illustrating that his policies do not necessarily add to the debt. But how do you implement these polices in a country that has so much debt, underfunded entitlement liabilities, and high inflation? Kenworthy admits that when “economic performance weakens, such as during recessions, the rise in support for public insurance, fairness, and personal freedom sometimes stalls or even reverses” (p. 7). He later adds, “[D]ebt forces a portion of revenues to go toward interest payments, which means those revenues can’t be used for transfers or services. A nation with social democratic policies but stuck with a sizable government debt might, for this reason, be less successful in boosting low-end living standards . . . without experiencing trade-offs” (p. 84).
What are those trade-offs? Kenworthy doesn’t tell us, but even with the undocumented paying into social security and other programs whose benefits they are ineligible for, the Congressional Budget Office estimates that net interest payments on the debt will reach $700 billion by the end of the decade. The United States printed 40 percent of the money supply after Oxford printed Kenworthy’s book; otherwise he might have spent more time on the question of inflation and debt.
The strongest case for these policies, however, is that they reduce inequality. As Kenworthy puts this: “If security is what most of us desperately want, it should be a major goal for society. The rich have quite a lot of it and the poor less. A happy society requires a lot of it all round” (p. 26).
Kenworthy illustrates that more people support government paternalism than they do individual freedom. Social welfare “boosts the living standards of the poor” (p. 32) and is “capability-enhancing” (p. 34). Kenworthy argues against relying on families and religious or voluntary organizations for the provision of social welfare. He offers that these have declined over the last half century. He shows an association between rising government expenditures and a declining rate of children growing up with two parents. The marriage rate, the rate of children growing up with married parents, and the rate of children growing up with two parents have all declined steadily. Kenworthy shows that the cross-national association between increased government expenditures and negative social outcomes is weak: “Our historical experience and those of other rich democratic countries suggest that more expansive and generous social programs and employment-conducive public services would help in the United States, and they would do so without sacrificing other good outcomes, such as economic growth or individual freedom” (p. 160).
There are a few other particularities about the United States that Kenworthy does not discuss, however. Kenworthy makes inroads in debates about class and macroeconomic correlations, but what about race? Do white Americans view social welfare as a wealth transfer to nonwhites? Are U.S. citizens similarly opposed to support for immigrants? Answers to these questions are crucial in understanding the structure of American welfare.
Social welfare policies are generally popular, but taxes rarely are. Very often, politicians try to expand benefits without raising taxes. Richard Nixon did so in 1969 by introducing the Family Assistance Plan, but took the dollar off the gold standard in order to curb the resulting inflation. Donald Trump and Joe Biden provided stimulus checks to Americans, but have also created inflation as a result. John Rawls wrote that “All ethical doctrines worth our attention take consequences into account in judging rightness” ([1971] 1999). One option to pay for Kenworthy’s policies could be to reduce military spending. Sociologists could likely be convinced to trade guns for gurneys, but can we dislodge longstanding Washington interests? Ultimately, the only long-term solution may be to raise taxes, and Kenworthy acknowledges that “taxes would have to increase significantly in order to pay for [single-payer health care]” (p. 165).
Now might be a good time to consider what makes a good society and how we can live in one. Advocates of social democratic policies will find the best of these arguments collected in SDC, illustrated with cross-national data. SDC is written in crystalline language, leaving no room for ambiguity. Kenworthy is persuasive and takes his opponents more seriously than most sociologists do. This is a good start to knitting together the political differences that Americans have.