Governments in Britain, France, Sweden, Netherlands, America, Italy, Australia, Sweden, Belgium, West Germany and Scandinavia already incorporated welfare systems before the Great Depression. Each country had employed different welfare policies. They could change their taxation and expenses on welfare accordingly as well as alter interest rates to ensure consumption and demand. Full employment, which was never higher than six percent, retained investments, spread education and lessened taxes on imports. Global trading and investments expanded, specifically between other advanced capitalist nations.
From 1945, the core welfare capitalist states of France, Belgium, Sweden, Switzerland and Britain modified their welfare systems. Their systems now include insurable risks like unemployment, illness and retirement, which had accelerated from the war. Some countries even assured eighty percent of their original wages to the recently unemployed, who were a small group with the new full employment welfare schemes. As a result of almost full employment, more people benefitted from welfare schemes.
Therefore, after World War Two, welfare capitalism proliferated and many in governments, civil spending rose up to twenty four per cent. However, the first welfare states only truly formed in the 1970s, with the drop in military spending, since student rebellions of the 1960s hampered welfare capitalism. Only in the early 1970s did countries like Italy, Germany, Netherlands and Norway decided to thoroughly cover all risks of welfare. Despite this, an incredibly little portion of welfare was given to unemployment benefits.
By 1973, unemployment levels accelerated without slowing down and funds were pulled out for pensions and healthcare. As a consequence, taxes and public service fees increased and there was a narrowing of those eligible to receive funds. The majority of people in the core states, particularly the elites, believed those in poverty to be ‘undeserving’ of the funds. However, welfare capitalism was designed to prevent the elite, who usually have similar political views and are of the same social class, from having too much influence over the economy. This implies that other less fortunate classes were able to obtain similar opportunities to the elite classes. This promotes equality, which is the right to be treated equally and social justice, which entitles the same rights and services as another to all citizens.
Therefore, the poor and underprivileged receive opportunities in housing, health and education. The increased access to education raises the chances of employment amongst the poor. Yet, inequality climbed (except in the USA) as only the elites had money to supply their children with secondary and higher schooling.
As a result, benefits were not completely equal to other classes. In fact, many countries deducted more earnings from the poor than from the wealth, producing an imbalance of wealth. Additionally, the middle to upper classes were more likely to illicitly avoid taxes and take out private investments, retaining the gap in wealth distribution. Therefore, equality was sometimes deficient for the elite still maintained higher incomes.
In Britain, the unemployed were encouraged to take jobs, any jobs regardless of the low amount of pay. This put them at a greater disadvantage. There was also a lack of concern of welfare schemes in the British middle class because benefits only seemed to assist the poorest. Hence, while the poorest were climbing into the higher classes, the middle-class began slipping into the lower classes. Therefore, welfare schemes should have included both middle and low classes as only Scandinavian states did. This would boost universal benefits so the low classes would acquire the mass of the benefits, but the middle class would also be offered assistance to elevate them into the upper class.
On the other hand, certain countries like Germany and Italy were prone to exclude the poorest as they sent benefits ‘based on long periods of contribution’. The consequences meant a larger space separating the wealthy and the poor and a heavy reduction of social justice in the countries.
Several countries’ welfare systems appeared to unintentionally promote inequality and the lessening of social justice. For example, initially, women had been excluded from the majority of welfare systems. This left nearly half the world’s population of women illiterate by the end of the 1900s. However, as the years went on and welfare capitalism developed, women were included and were able to benefit from the welfare education systems set in place.
In conclusion, welfare capitalism brought about social justice and equality after 1945 to some extent. In certain countries though, welfare capitalism only seemed to increase the inequality in wealth and incomes. However, welfare capitalism has more positive outcomes than disadvantages for multiple reasons. For one it improves healthcare and housing to uplift alleviation and living standards. Education for the underprivileged also gives them the opportunity to become employed and increase their income, which could help raise them into a wealthier social class. Since welfare capitalism specifically looked after the labour force, which comprised of the majority of the population from full employment, it assisted most of the nation. Therefore, in general, welfare capitalism brought about social justice and equality.
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