Germany vs. US - Two Welfare Regimes seen from the Gender perspective

List of Contents

1. Introduction

2. Germany and the United States: conservative-corporatism versus liberalism
2.1 Critique on the Esping-Andersen model

3. Germany in the 1990’s: between reunification and power exchange on the top
3.1 The impact of reunification on women in the East
3.2 Germany reunited, second half of Kohl’s era

4. United States: Reform of the welfare system
4.2 The Personal Responsibility and Work Opportunity Reconciliation Act 1996
4.3 The feminist critique

5. Conclusions

6. Literature

1. Introduction

This paper deals with the problem of the welfare state in two states subordinated to two different welfare regimes: conservative-corporatist (Germany) and liberal regime (United States). Having in mind, that this a very wide and multidimensional problematic, it will be limited only to the changes in welfare systems mainly in the 1990s seen from the perspective of gender relations and women’s situation in welfare.

In short, this paper will focus on the German reunification and the changes it exerted on the women’s situation in former GDR. Then it will present briefly policy towards women and families under Chancellor Kohl’s governance. Regarding the USA, welfare reform of 1996 will mainly be discussed – the Personal Responsibility Act - preparations, contents, and the effect.¹ Afterwards, the reaction of the feminist societies on the changes in the American welfare will be presented.

Before the main part, as a starting point, the differences between Germany and the US as two states representing two different welfare regimes will be briefly presented. This comparison will be based on the Esping-Andersen model that was introduced to the study of welfare at the beginning of 1990’s. The feminist critique on basic assumptions of Esping-Andersen’s classification shall not also be omited.

2. Germany and the United States: conservative-corporatism versus liberalism.

Gøsta Esping-Andersen (1990) constructs three basic types of welfare regimes that differ in arrangements between state market and family in providing income and services, the way the welfare state influences the system of stratification and affects the social citizenship rights including the decommodification of labor². A distinction is made among liberal, conservative-corporatist, and social-democratic regimes. The most characteristic differences are presented below.

The liberal welfare state promotes market, rather than the state, in guaranteeing most welfare needs of most citizens. The state is so-called “last resource”, it reacts only in case of social failures and limits the help only to special groups - means-tested assistance³. The transfers are modest and rules for entitlement very strict. In consequence, liberal regimes promote social dualism between citizens relying either on the market or on public provisions - private pensions versus social assistance. The decommodification is limited. The state is formally indifferent to gender relations. Traditional, liberal-protestant work ethics is the basic thought that influenced the shape of this regime type. Esping-Andersen presents the United States, Canada, and the United Kingdom as examples.

The conservative-corporatist regime, on the contrary, emerged from the historical corporatist-estatist legacy and was visibly shaped by the (catholic) Church. The citizens are under the “umbrella” of the state; market plays a marginal role in providing the welfare (e.g. private insurance). The regime does not promote decommodification of labor, as granting of social issues was hardly ever a subject of concern. It rather maintains status and class differentials by offering separate provisions for different social strata. It preserves traditional family relations with male as breadwinner and discourages women from working. The ideal model is: “the mobile husband and immobile, caring woman”⁴. The tax system favors marriages, social insurance excludes non-working wives, and family benefits encourage motherhood. At a time, day care services (e.g. kindergartens) are seriously underdeveloped. The principle of subsidiarity strengthens the role of the family as it makes the state being responsible for a person only when the family and closest environment (including local voluntary and religious organizations) are unable to help. The solidarity principle, relying on the wider community as a room for plural interests and policy positions is also not without significance. Within Europe, Germany as well as France and Italy, come nearest to this ideal.

Finally, yet importantly, the social-democratic regime is characteristic for the Scandinavian countries, with Sweden being given as an example. This third cluster is not the matter of concern in this paper, yet it is worth mentioning here. Social-democratic regimes are highly egalitarian and universalistic. They promote equality of the highest standards; workers enjoy rights identical to the one of the better–off, class differences are reduced by income redistribution. Citizens are included in common programs. All strata, for example, are incorporated under one insurance system, and the policy of full employment is promoted. The decommodification of labor is most significant there since provision is generous, benefits are universal, and access is relatively easy for workers. This is also the most “woman - friendly” welfare regime as the state attempts to socialize the costs of familyhood and encourages mothers to enter the paid labor force by providing day care, parental leaves, organizing care for the aged, etc.

These are the three, pure welfare state types presented by Esping-Andersen. As seen above Germany and the United States are classified to two different clusters: the first one as a representative of the conservative-corporatist, the second being a liberal regime. Such distinctiveness will be presented in the following sections of this paper.

2.1 Critique on the Esping-Andersen model.

In spite of the fact, that Esping-Andersen noticed the influence of welfare state on gender relations, as the factor shaping norms and values of femininity and masculinity, he received lots of criticism from gender scholars. Many feminists argued with Esping-Andersen mainly for the holistic assumption – gender blindness (see Orloff 1993 and 1996, Lewis 1993, Meyer 1994, Van Doorne-Huiskes 1996, O’Connor/ Orloff/ Shaver 1999). Although his classification is important, because it makes a link between work and welfare, he ignores the significance of housework and unpaid care work, sexual division of labor and presents decommodification of labor as purely male in mind. He does not take under consideration, for example, that the social basis for decommodification is fundamentally different for both genders (Meyer 1994, p.63). The main feminist argument then is that women have the chance to enter Esping-Andersen model only, when they enter the paid labor market, and their access to other benefits is not as women but as mothers or widows (compare: Lewis 1993, p.13-14). What is more important for this paper though, is the feminist critique on not always adequate analyze of German and the US welfare state as representative examples. Orloff (1993, pp.312-313), for instance, gives three main objectives. Primary, analyzing the effects of services on women’s abilities the model does not reflect differences in care provision. There are considerable differences among the conservative-corporatist states: Germany in promoting housewifery offers few services, France - the contrary. The liberal regimes like the USA, underline the role of market and private sphere in providing care provisions. Secondly, the Esping-Andersen typology does not precisely predict some women’s employment patterns, such as occupational sex segregation and domination of part-time work. In Germany, as well as in Sweden (sic!), there is a significant concentration of women in part-time employment and, at a time, high level of sex-segregation. Correspondingly, Orloff does not expect the decline of the latter also in the USA - the state where job de-segregation is the strongest among all welfare states. Last but not least, the fact that even working women do the bulk of unpaid domestic work is not challenged by Esping-Andersen. There is no explanation, why in the liberal United States, women are 74% to perform housework, while surprisingly, in social democratic Sweden it is only two percent less.

The main conclusion is then, that one needs to remember about certain “margin of tolerance” discussing different welfare systems. Even if Germany and the US are closest to the ideal, there is no pure example of it. Some scholars also argue, that adding the aspect of gender to the Esping-Andersen typology could only prove its inadequacy and uselessness (Orloff 1993, Van Doorne-Huiskes 1996). The next two sections of this paper deal with the assumption that the last decade brought significant changes in the structure of the two welfare systems. The question is, whether these new arrangements mean the improvement in gender relations and position of women, or exactly the contrary to it.

3. Germany in the 1990’s: between reunification and power exchange on the top.

This section focuses on two main political changes that greatly influenced the welfare system of the Federal Republic of Germany in the 1990’s. The reunification, more accurately the incorporation of the GDR into Western Germany at the beginning of the decade rapidly changed the social situation and welfare of millions of women from the Eastern part. The long lasting Kohl’s Era in politics and interesting changes in conservative approach towards welfare also influenced gender relations.

3.1 The impact of reunification on women in the East.

In the communist Democratic Republic, different from West Germany, paid work was obligatory for all adults. In effect, while in the latter only 50% of women were employed, the East had the female participation rate in the labor market of 91%. The state encouraged the double role of women: as employees and mothers. It guaranteed very low costs of raising the children by creating a system of work-place and district kindergartens, longer school-hours, after-school facilities, etc – all either free or at symbolic cost, heavily subsidized by the state. Social policy provided women with convenient pensions, pensionable age, parental leave, no-fault divorce, contraception facilities, and free abortion. That independence of working mothers was also visible in high divorce rates and the large number of single parents⁵ (see also: Wilson 1993, Lewis 1993, Chamberlayne 1997). In all, patterns of labor market participation, household formation, or motherhood were significantly different from that one of Western German.

The Treaty of Unification, in power since October 1990, extended Western German laws, including welfare and social legislation, to the former GDR. Divorce became possible only under federal laws, as well as abortion (with two years of transition). The children´s facilities and social support were drastically limited, made payable or just closed. The conservative principle of subsidiarity justified the return of caring functions to the family, allocating them to women and strengthening the model of the “male breadwinner”. The reunification was also followed by large-scale unemployment. Approximately 45% of the Eastern German jobs disappeared; the majority of these lost positions were those held by women (not including a large number of women who were sent to an earlier retirement). The explanation of this phenomenon is relatively easy. In spite of official gender equality in the GDR and encouragement to a dual role for women⁶, there was still job segregation that seriously disadvantaged women. Women feminized caring and teaching sectors, as well as vulnerable branches of the industry⁷ that were the first to be liquidated in a process of privatization after the reunification. Moreover, more women than men had only part time jobs, and those, who were working full time, earned only 75% of the salaries of men on the same position⁸. The Federal government tried to deal with the crisis by extending conservative labor market and welfare programs (Social Security and Social Assistance)⁹ to the former GDR. The effect was however different than the expectations: a fiscal crisis, combined with increasing, large-scale unemployment¹⁰, an enormous grow in number of recipients of Social Security and Social Assistance, and a conflict of values between East and West were only few of several problems (Wilson 1993, p.143).

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¹ As this article deals with long-term developments, the Schröder and Bush jr. governments are left out.

² Esping-Andersen explains decommodification of labour as the situation when the welfare of individuals doesn’t depend exclusively on the cash nexus, but when modern social rights allow the individual to maintain a livelihood without reliance on the market (see further Esping-Andersen 1990, pp. 21-22).

³ This characterizes also residual regimes in the earlier classification of welfare regimes by Titmuss in the 1950’s. Residual welfare states were to react only to market or family failures and limit assistance to marginal or especially deserving social groups. The second group of welfare states – institutional one were to be pro-active and commit to the needs of all strata in the society. They correspond very well with two remaining types of Esping-Andersen (see also Orloff 1993, p 310).

⁴ See further: Lewis, Ostner 1994, pp. 19-25

⁵ At a time, one can speak about discrimination of the fathers, as the state as a global father has taken that responsibility. Fathers could not claim housing scheme, Hausarbeitstag, parental leave, lesser years to work etc (see: Orloff 1993, p.108, Lewis, Orloff 1994, p.30)

⁶ This was mainly the effect of serious labor shortages in the GDR and state’s policy trying to overcome that problem. Soon the double role turned into double burden (Doppelbelastung), as there is no evidence, that household tasks were more fairly shared in Eastern Germany as in the West (see: Chamberlayne 1997).

⁷ For example: food processing, agriculture, textiles, social services, as well as typically “male” branches: building, engineering and manufacturing.

⁸ At a time, in West Germany that proportion was only a bit bigger: women’s salary was 70% of male (Ostner 1993).

⁹ Sozialversicherung and Sozialhilfe, two basic welfare systems of income maintenance.

¹⁰ The unemployment rate for entire Germany arose from 7,6% in 1992 to 12,1% in 1997. The 16% unemployment in the East is counterposed to 9,2% in the West (Bundeszentrale für Politische Bildung, Informationen zur politischen Bildung, Nr. 269/ 2000)