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Understanding the New Politics of Welfare Reform: Preface

For some time, a sense of crisis has surrounded welfare states. Deregulatory pressures, sluggish economic growth, deindustrialisation of labour markets, rising unemployment, demographic ageing, declining birth rates and family restructuring are commonly listed among the most pressing challenges facing mature welfare regimes.Together, such challenges contribute to an explosive mix by simultaneously exerting pressure for increases in social welfare expenditure while contracting the fiscal foundation on which states rely to deliver it. While such pressures are not new, they have been severely aggravated by the financial crash of 2008 and the global recession now under way.As governments struggle to finance their large and increasing budget deficits, they advance plans for welfare cutbacks while bracing themselves for backlash over austerity measures. Conflicts over coming changes in social policy, and especially over the new distributional inequalities they are likely to generate, look set to intensify in coming years. This dim prospect provides a timely background for this collection of articles. If there was ever a time when it was critical to dig deeper into the operating conditions, mechanisms and strategies of austerity management and welfare restructuring in this era of unwavering austerity, that time is now. In mature welfare states the lion’s share of social expenditure goes to health care and pensions. Compared with these, the more recently adopted active labour market policies (ALMP), designed to promote skill training, mobility and employment, represent a much thinner slice of the budget.YetALMPs are perceived as key in an environment characterised by the accelerating dualisation of the workforce. Labour market insiders, those holding standard, protected and stable jobs, face a growing number of labour market outsiders, marginally or insecurely employed, and more likely to find themselves in unemployment. Under conditions of tightening financial austerity, such conflicts in what is an already divided labour market are likely to deepen further,and welfare politics can easily turn into a tense zero-sum game,where the gains of one group are obtained at the cost of the losses of the other. While the importance of the insider/outsider divide has been recognised, our understanding of how it gets to be represented in party and interest intermediation systems remains limited.The first article in this special section addresses this gap in our knowledge. Classical power resource theory argued that the role and the power of the left ‐ trade unions bs_bs_banner