A review of The Rise and Fall of the Welfare State by Asbjorn Wahl. Pluto Press, 2011.
Since the hot summer of protests in Israel everyone here has been talking about the Welfare State, Scandinavian style. The Rise and Fall of the Welfare State, by the Norwegian socialist Asbjorn Wahl, presents us with an opportunity to look closely at this concept. Wahl refutes the illusion according to which there is such a thing as a welfare state model that can act as a bridge between Capitalism and Socialism. The rise of unrestrained capitalism in the last three decades has brought about the destruction of social services and the end of Solidarity. At the same time, Wahl doesn’t look back with nostalgia. Rather, he produces an unsentimental critique, and a direct appeal to social groups and trade unions to come up with an alternative, political and social, to get the Left out of its present state of impotence.
Wahl claims that the welfare State was not born from the good will of the wealthy. Its social achievements during the post WWII period, in housing, education, health and social welfare, resulted from the strength of trade unions, and from the fear on the part of the wealthy that their anti-social policies would steer the working classes toward Communism. Therefore, the Welfare State was a kind of unstable compromise, enabled by a particular situation at a specific historical point, while the wealthy retained their control over industrial resources and production.
These limited arrangements, which form the basis of the Welfare State, explain, in the view of the author, the relative ease with which the neo-liberal revolution began in the 1980’s. Wahl refutes the view, held by leaders of the Left, that globalization is inevitable. He says it is not some natural law or a volcanic eruption. Globalization benefits financiers whose interests are served by eroding the limitations on capital transfers.
Similar interests are served by the privatization of public companies and essential services. This is often seen as a solution to their perceived inefficiency and dysfunction. Wahl explains in detail how it works: First, the public service is starved of funds, creating a public mood that supports radical reform. Then, partial solutions are put forward, which lead the service gradually in the direction of privatization. Finally, the process is completed by the handing over of the service to private companies.
The massive force of unrestrained finance capitalism pushes toward privatization, taking control of public debate. Wahl points out a very important angle in this regard: In the past, large corporations searched for new markets in the third world. Today, they attack local markets, water, waste disposal, transport, and the media – and turn these into profit makers, while destroying social equality and solidarity.
In the chapter concerning the brutalization of the work place, Wahl describes the phenomenon of “social dumping,” caused by the employment of foreign workers at very low rates of pay. As soon as the government removes restriction on capital transfers and enables production to be switched to low-pay economies, where the work force is not organized, it neutralizes the influence of local trade unions.
In addition, the ‘Workfare’ program, called “Wisconsin” in Israel, which professes to return the unemployed to the labor market, is discussed at length. In practice, Wahl claims, the program increases costs, while many of those who return to work remain poor. ‘Workfare’ is based on the liberal view that the ‘Homo Economicos’ is motivated by self-interest. According to this view, people only agree to work for financial gain. This is a mechanical and reactionary outlook on human nature, which stands in direct opposition to the principles that formed the basis of the labor movement.
Wahl, a long standing activist in the Norwegian and European workers’ movement, is very critical of the leadership of the political Left and of trade unions. He claims that they are stuck in a perception of being in partnership with the wealthy. This is why they were taken completely by surprise when the neo-liberal revolution was turned against them. Rather than defend the achievements of the Welfare State, they accepted the neo-liberal ideology as a kind of unstoppable historical force.
Wahl brings up the often forgotten fact that, for the workers’ movement, the Welfare State was never an aim in itself. The aim, as defined by trade union programs, and by Communist, Socialist and Social-Democratic manifestos, was, in fact Socialism. Conflicts and disagreements among the parties and the various forces were always concerned with the question of how to achieve a socialist state.
The compromise that gave rise to the Welfare State is defined by Wahl as a bargain in which workers gained a significant rise in their living standards, in return for which they renounced the Socialist goal. The ideology which stood behind this class-based compromise brought about the de-politicization and de-radicalization of the working class. In doing so, it weakened the resolve of the labor movement to confront further capitalist attacks, such as the ones experienced today by the working- and middle-classes in a growing number of European countries.
Apart from presenting the reader with important facts and ideas, the book offers a new spirit of creativity and solidarity. Wahl joins the increasing number of voices among Western trade unionists, calling for unions to open their doors to groups that have been excluded in the past, such as women, ethnic minorities, immigrants and green activists.
However, Wahl goes one step further. Rather than harking back to the old welfare state, he suggests the construction of a social force that will block the attack of the capitalist right wing, establish a system of public controls and rebuild ailing essential services. The leftist forces that are entrenched in the field, involved in the groundwork of trade unions which are open and democratic, and in other social movements, are the key to such a change. Wahl’s model is based on far-reaching and unconventional kinds of cooperation with new social forces outside the trade union movement.
There is a clear message here for the debate taking place now among protest activists in Israel – don’t wait for complete consensus. Don’t agree to concessions for the middle class at the expense of dealing with root problems of the weaker classes. The wealthy and leaders of the old regime are not “good people” who have lost their way, but the representatives of a class whose interests are diametrically opposed to those of the general public and in particular the working class. Those who dream of a democratic Welfare State, producing justice and equality for all, cannot find it by hankering after the past, but by preparing for a new class struggle and by working to build the forces that will advance toward a new system.
Questions and answers with Asbjorn Wahl:
Q: What would be the best way to describe your political convictions: “socialist” “independent Marxist” or something else?
I consider myself to be a socialist.
Q: How many years you are active in the trade union. In what job did you start? What is your exact position in the union now?
I was active in my local trade union branch first (Metal Workers’ Union), but became editor of the magazine of the Railway Workers’ Union in 1983 (I was educated a journalist), worked for three and a half years at the head office of the International Transport Workers’ Federation in London in the 1990s and have been with the Norwegian Union of Municipal and General Employees since 1997 – so almost 30 years in full time work for the trade union movement.
Q: When and why did you become involved in the coalition for the welfare state? Who are the forces groups unions that are involved in it?
I was involved in setting up the Campaign for the Welfare State in 1998-99. The initiative was taken by my union, and together with five other national trade unions (inside and outside the Norwegian Confederation of Trade Unions (LO)), we formally established this coalition in 1999 (see more on this 
here). The reason was that the general, international, neoliberal offensive also influenced the political situation in Norway (including the Social Democratic Party), and privatization and deregulation of public welfare services began. The coalition was formed in order to strengthen the opposition to this policy and to develop alternative policies to modernize and democratize the public welfare services. Most of the organizations in the coalition are trade unions (both in the public and in the private sector), but we do also have a peasant organization, a retired people’s association, organizations of users of public welfare services, women’s organizations, student organizations and some few others (about 25 national organizations) – and even some municipalities.
- Translated from the Hebrew by Ya’ara Gregory