One of the most important claims that the friends of the blue social model make is that it addresses the needs of the poor and the weak better than any other existing social system. This is a serious point that blue critics sometimes don’t think enough about, but the claim is more questionable than blues admit — and more to the point, from where we are today, the basic methods of the old social model aren’t likely to make things much better.Social conditions in early 20th century America were genuinely appalling. A lack of basic public health in some places meant unnecessary deaths from infectious disease; child labor in factories and mines was still widespread. Industrial workers faced killing hours in dangerous and polluted factories. Poorly packaged and preserved food was sold without any kind of check. Most kids got at most an eighth grade education; old people who could no longer work were often left destitute. Those who were crippled or disabled often were left to their own resources. Given the widespread discrimination against women, families whose fathers were no longer present were often in terrible want. Poor people did not get fat from bad nutrition in those days; they grew gaunt from hunger.Racial conditions were barbaric; brutal lynchings were commonplace in parts of the South. Interracial marriage was banned by law in many states, race discrimination was enforced by law, and courts routinely sentenced African-American defendants to hard labor on minimal grounds.Progressive social programs and government policies aimed to cure these problems, and defenders of the blue social model are correct to take pride in that and correct, also, to challenge critics of big blue to ask what will take the place of the network of entitlements, transfer programs, government regulations, agencies and laws aimed at helping the weak and the afflicted amid the storms of life. That there are many gains cannot be doubted, and while it is not always easy to apportion credit for improvements between changing laws and greater national wealth, the association of blue social programs with a serious agenda for social improvement is hard to dispute.But those defenders need to acknowledge as well that the blue social model hasn’t cured many of the conditions it sought to address. The horrendous conditions in inner cities, the periodic scandals involving state-managed custodial care institutions, the entrenched mediocrity and worse (far, far worse in too many cases) of so many public schools — all combine to raise legitimate questions about whether blue really performs as advertised. Nor, frankly, does blue seem to get better from decade to decade. Costs go up pretty relentlessly, but results manifestly do not.It is incontestably true that blue society spends more on social programs and transfer payments than other forms of social organization have done in the past. And it is also true that some of these programs work pretty well: senior citizens, the chief beneficiaries of government spending, for example, are much less poor than old people used to be. More kids get more school than in the 19th century, and programs like unemployment compensation and disability insurance — even if they are sometimes abused — address important needs in a serious way. It seems highly unlikely that post-blue liberal society would push the old folks out on the ice floes or put the orphans back in the workhouses. The blind and the crippled won’t be out begging on the streets.But it seems equally unlikely that the current approaches to poverty, disability, old age and unemployment can survive without sweeping change. Some of the programs (like Medicare) will literally bankrupt us if not changed; others may be cheaper but they are so ineffective or counterproductive that the public will not indefinitely support them in their present form. If society is going to get better, if the gains of the progressive era can be mostly conserved while the era’s limits are transcended, we will have to find a road to the future that isn’t paved with blue.For a social imagination that is largely shaped by the assumptions and patterns of the progressive state, the only possible discussions about the social support structures of blue model society involve tweaks and reforms: some means testing here, some administrative changes there, some tweaking of incentives over yonder. This isn’t always wrong. There are some programs (like Social Security) that may very well work over the long run with this kind of reform, and the party line here at Via Meadia doesn’t favor change for change’s sake.But sometimes big changes are needed, and this is where a new social vision is going to have to take shape. When blue partisans contemplate revolutionary shifts in social policy, they are from less blue to more blue: a shift to a single payer system of national health care for example, is revolutionary but quite thinkable for blue intellectuals because it represents an expansion of the blue model rather than a departure from it. Standing back from the whole system and thinking in different ways about post-blue approaches is going to be necessary if some of our problems can be addressed.To begin with, we need to remember that income transfers, entitlements and social programs generally aren’t ends in themselves. Building a welfare state is a means to an end: building a society in which as many people as possible have the opportunity to become prosperous based on their own work and achievement, and where the sick, the weak and the disabled receive compassion and care. Seriously rethinking our current set of social programs means looking at the goal and thinking about how that goal can best be achieved in the new conditions of our time.Some of this involves basic economic policy. All things being equal, a wealthier society will be more willing and more able to help the poor than a poorer one. If we are all fighting for scraps, fewer people will be ready to share and to help out. I’ve written before about the need to develop a prosperous post-industrial society. There is simply no way we are going to help the poor as much as one would like until we start to build a healthy and prosperous post-blue, post-industrial economy that provides the affluence and resources for those in need.Part of that social reconstruction will involve steps that have a direct effect on services for the poor. Right now our delivery systems for vital social services like health and education are grotesquely wasteful, primitive and inefficient. (Typically, our technology is good; our organizational structures, professional guild systems, and misaligned incentives are grossly inadequate.) One of the chief secrets to a generation of new economic growth, and also of serving the poor and the needy more effectively, involves cutting costs for basic social goods through successive waves of sweeping change.As good quality education and health care become more expensive, it becomes harder for society to provide these goods to those who cannot provide them out of their own earnings. The development of a good $10,000 bachelor program would do more for low and lower middle income families than doubling the size of all student loan programs. Generally speaking, anything that makes education cheaper and easier — shifting from a “time served” model to a skills learned model for awarding qualifications and degrees, breaking the guild monopolies through accreditation and other systems so that more institutions can compete in the market — will make society less blue, but make the poor better off.Ripping up the bloated administrative systems, deflating the cost structures, breaking the hold of the guilds on accreditation, downshifting credentialism and other changes are vital for the social productivity and economic prosperity of the nation as a whole — and for the social and economic advancement of the middle class. They are also urgently required in the name of social justice.For health care, the connection is even more obvious. Cutting the costs of health care by changing the way we provide it would reduce costs for everyone, and make it much easier to provide insurance for those who can’t pay on their own. It is ridiculous and unacceptable that the fat and dysfunctional US health care system consumes more resources while delivering outcomes no better than cheaper systems in other countries. But to try to imitate those countries in the hope of someday catching up or at least reducing the gap is not the American way.The kind of health care system Americans should have would deliver significantly better outcomes than the systems in other places. We should be thinking about how we can restructure our system taking advantage of the unprecedented resources of IT to create a health care system that is as superior to what we and the world have seen to date as the interstate highway system is superior to horses and buggies on plank roads.Again, moving toward this goal would have huge implications for our economic prosperity overall. If Americans have to spend less on health care than people in other countries, while enjoying equal or better outcomes, our taxes will be lower, our firms will be more profitable, our real wages will be higher — and, among other things, we will be a more desirable location for investment than other countries still wedded to what should soon become very old fashioned health systems.But apart from the benefit to society as a whole, there are special benefits for the poor and the marginalized in a more productive, less expensive health care system. In reality, health care for the poor is always going to be rationed; there are limits to how much the middle and upper classes will consent to redistribute resources away from themselves to those with less power. The poor will benefit from a cheaper, better system because the resources available to them will go farther in it, and because reducing the need to subsidize middle class health care leaves society with more resources available for the poor.Restructuring health care is a moral imperative; if you seriously care about the poor you need to care about building a health system capable of delivering the services they need at a price we can sustainably pay.Much of the change that we need will offend powerful interest groups. Big corporations have large interests in the current system. But the professional guilds may be the toughest obstacles. One of the great advantages of the IT revolution is the opportunity it provides to ‘de-skill’ increasingly sophisticated tasks. Registered nurses (equipped with computers and the ability to contact back-ups where necessary) should be able to handle a significant percentage of the tasks that doctors now do. Practical nurses in turn should be able to do more things that now only registered nurses can do. More, educational reform that makes it much cheaper for people to qualify for these professions can bring costs down by increasing the number of service providers — and reduce the costs that they must charge in order to recoup the price of education.Much routine health care could probably be carried out in pharmacies and shopping malls rather than in medical offices. Computerized medical records, better diagnostic software and a regulatory system that promotes lower costs by supporting more flexible health care delivery models would mean than many simple medical needs that now require doctor visits (often for prescriptions) could be handled quite cheaply. And as long as these service providers were trained to kick problems up to a higher level of personnel when more complex problems were in view, much of the work now done by doctors and nurses could be handled by providers charging less, in more convenient locations, and available 24/7.Micro-reform of health care — making good health care cheaper by focusing intensely on improving productivity and stripping out rules and practices (including the malpractice machine) that inflate costs — doesn’t provide blue reformers with all the fun of big national institution building and oversight, but can deliver better outcomes to more poor people far more sustainably than further subsidizing the current bloated and inefficient system can hope to do.Both Obamacare and single payer systems bureaucratize health care and slow down the process of deep restructuring that the sector actually needs. At the federal and state levels, policy makers should, for example, be looking for ways to “de-skill” as many health care jobs as possible rather than enacting the status quo into law.Again, this is a moral duty and not just a pragmatic and necessary set of reforms. If the poor are going to get more health care, health care is going to have to become much more abundant and much cheaper. Before the industrial revolution, many poor people lacked decent clothing. The poor used to dress quite literally in rags, but the industrial revolution eventually made serviceable and even stylish clothing available to almost everyone. The guilds of the spinners and the weavers hated the way the new looms took away their special status and cut their wages; so be it. IT makes it increasingly possible to have the equivalent of an industrial revolution in health care; it is our duty to carry these changes through.The massive restructuring of government at all levels is also part of the picture. Reducing the cost of government and enhancing its productivity frees up tax revenue that can either be returned to the taxpayers through tax cuts, applied to pay off past debts and reduce future interest costs, or spent on better programs for the poor. All three outcomes help the poor more than continuing to try to manage our national and state affairs through bureaucracies whose organization and hiring policies haven’t kept pace with practices in the private sector.A leaner, more effective government will promote economic growth and employment in other ways. If American cities could reduce the time spent obtaining permits by 50% while reducing their bureaucratic headcount, for example, we would see more jobs available for inner city residents. Establishing national, state and local goals for reducing the drag of paperwork and government inefficiency by computerizing and streamlining government agencies while pruning and rationalizing regulations would promote employment and opportunity for poor Americans while reducing the cost of government overall.Another enhancement could come from abolishing some government agencies in favor of small, community-based co-ops. The unemployed, for example, could be given vouchers for training and benefits and private firms could compete to provide job training, counseling and payment services. The state could narrow its focus from administering complex benefit and training programs to ensuring that service providers complied with the terms of the program. The track record of these service providers could be widely available over the internet so that the unemployed could make an informed choice among those who wanted their business. The cost savings from closing down poorly managed and inefficient government offices could be spent on raising the value of the vouchers for services and benefits issued to the unemployed.More generally, the use of vouchers to turn government from the provider of bureaucratic services to the promoter of private market transactions would reduce bureaucratic overhead in many areas, give citizens and service consumers for choice, and help shift American culture from a bureaucratic-administrative one back toward entrepreneurship and enterprise.Given the low level of savings among many older people and the growing pressure on both public and private pension and health care programs for the retired, increasing the income of older people is going play a significant role in handling what could otherwise become a serious social problem. We need to make it easier and more attractive for older people to continue working. This does not mean keeping everyone in full time employment or in their current jobs. Many older people would like to supplement Social Security and other retirement incomes by working part time, shifting to less physically challenging jobs or working from home. For many people the physical demands of commuting are the reason for retirement; their minds may still be keen and their bank balances hungry, but driving or taking public transportation to faraway workplaces becomes unbearable. Finding ways to promote telecommuting will help ease America’s Social Security and Medicare problem — the longer people are paying into the system the better health those systems are in.All of these changes offer benefits to the poor. None of them involve classic blue model social programs or top down bureaucratic command and control organizations. Some might require government investments up front, but all things being equal they are likely to pay for themselves very quickly without cutting services to those in need.The next stage in America’s effort to reduce poverty and help the sick and the afflicted does not involve more of the same programs, larger and larger appropriations for less and less effective bureaucracies — funded by less and less sustainable debts. It involves an intellectual revolution, a leap from the stale confines of blue model organizational thinking to create 21st century institutions, practices and firms.Blue partisans are stuck on the idea that progress to be real must be blue. That idea doesn’t work anywhere these days, and it works least of all for the poor.[Image courtesy Shutterstock]
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Published on: April 10, 2012Ending The Poverty Blues