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The global social insurance movement since the 1880s*

Published online by Cambridge University Press:  25 February 2010

Aiqun Hu  and
Patrick Manning
Aiqun Hu
Affiliation:
History Department, Arkansas State University, PO Box 1690, State University, AR 72467, USA E-mail: aiqunxsh@yahoo.com
Patrick Manning
Affiliation:
Patrick Manning, Department of History, 3904 Posvar Hall, University of Pittsburgh, Pittsburgh, PA 15260, USA E-mail: pmanning@pitt.edu
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Abstract

This article analyses the patterns and dynamics of the global social insurance movement since the 1880s through the framework of ‘interactive diffusion’. It argues that two principal models of social insurance – the German capitalist and Soviet socialist – diffused around the world throughout the twentieth century. It contends that global forces conveyed basic ideas while national forces determined the timing and specifics of the adoption of global models. From the 1980s, however, a new global model of privatization emerged with the rise of neo-liberalism and support from the World Bank. Privatization partially replaced public pension systems in Latin America, then in the former socialist countries in Europe and in a few other countries. Nevertheless, national compulsory social insurance has remained the predominant form for social protection in the world.

Type
Articles
Information
Journal of Global History , Volume 5 , Issue 1 , March 2010 , pp. 125 - 148
Copyright
Copyright © Cambridge University Press 2010

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References

1 Daniel Rodgers, Atlantic crossings: social politics in a progressive age, Cambridge, MA: Harvard University Press, 1998.

2 David Collier and Richard E. Messick, ‘Prerequisites versus diffusion: testing alternative explanations of social security adoption’, American Political Science Review 69, 1975, pp. 1299–1315; Andrew Abbott and Stanley DeViney, ‘The welfare state as transnational event: evidence from sequences of policy adoption’, Social Science History, 16, 2, 1992, pp. 245–74. For more recent work, see David M. Cutler and Richard Johnson, ‘The birth and growth of the social insurance state: explaining old age and medical insurance across countries’, Public Choice, 120, 2004, pp. 87–121.

3 The International Labour Organization (henceforth ILO), Approaches to social security: an international survey, Montreal: International Labour Office, 1942, p. 23; Abbott and DeViney, ‘Welfare state’, p. 266.

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5 Aiqun Hu, ‘Social insurance in twentieth century China: a global historical perspective’, PhD thesis, Northeastern University, 2007, p. 49.

6 The term ‘diffusion’ is here taken, in its sociological sense, to mean the general spread of a phenomenon. The term is to be used with some caution, however, in that it sometimes refers to a spread in which the items or institutions move only outwards and undergo no change in the process. See Patrick Manning, Navigating world history: historians create a global past, New York: Palgrave, 2003, p. 281.

7 See Gaston V. Rimlinger, Welfare policy and industrialization in Europe, America, and Russia, New York: John Wiley & Sons Inc, 1971; Peter Flora and A. J. Heidenheimer, eds., The development of welfare states in Europe and America, New Brunswick, NJ: Transaction, 1981.

8 See Gøsta Esping-Andersen, The three worlds of welfare capitalism, Princeton, NJ: Princeton University Press, 1990; Peter Baldwin, The politics of social solidarity: class bases of the European welfare state, 1875–1975, Cambridge: Cambridge University Press, 1990.

9 See J. O’Connor, The fiscal crisis of the state, New York: St. Martin’s Press, 1973; L. Olsen, The political economy of the welfare state, New York: Columbia University Press, 1982.

10 See Peter B. Evans, Dietrich Rueschemeyer, and Theda Skocpol, eds., Bringing the state back in, Cambridge: Cambridge University Press, 1985; Theda Skocpol, Protecting soldiers and mothers, the political origins of social policy in the United States, Cambridge, MA: Harvard University Press, 1992.

11 Hugh Heclo, Modern social politics in Britain and Sweden: from relief to income maintenance, New Haven, CT: Yale University Press, 1974; Rodgers, Atlantic crossings.

12 Collier and Messick, ‘Prerequisites’; and Abbott and DeViney, ‘Welfare state’, p. 261.

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15 See the articles in Annals of the American Academy of Political and Social Science, 598, 2005.

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18 Elkins and Simmons, ‘On waves’.

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22 Korpi and Palme, ‘Paradox’, pp. 668–9. The Beveridge plan also included a national medical care system, but we do not extend our analysis to medical care systems in either capitalist or socialist states. Also, following the conventional practice, in this article we use the terms ‘old-age insurance’ and ‘pension systems’ interchangeably; we also use interchangeably the terms ‘medical care’ and ‘health care’, ‘sickness insurance’ and ‘health insurance’.

23 ILO, Approaches to social security, p. 26.

24 In the words of Rimlinger, ‘The character of Soviet thought in this respect is quite opposite from the American, though no less ambiguous. It stresses, on the one hand, that benefits are a free gift from the state, an act of governmental benevolence, a manifestation of socialist humanism. … On the other hand … social security is treated also as an historic right of the working population, a right which has been incorporated into the Constitution’: Gaston V. Rimlinger, ‘Social security, incentives, and controls in the US and USSR’, Comparative Studies in Society and History, 4, 1, 1961, p. 112. See also John Dixon and Hyung Shik Kim, ‘Social welfare under socialism’, in John Dixon and David Macarov, eds., Social welfare in socialist countries, New York: Routledge, 1992, pp. 1–9.

25 Dixon and Kim, ‘Social welfare’, p. 6.

26 Giuliano Bonoli, The politics of pension reform: institutions and policy change in western Europe, Cambridge: Cambridge University Press, 2000, pp. 10–11. See also Mitchell A. Orenstein, ‘Mapping the diffusion of pension innovation’, in Robert Holzmann, Mitchell Orenstein and Michal Rutkowski eds., Pension reform in Europe: process and progress, Washington, DC: World Bank, 2003; and idem, Privatizing pensions.

27 Gareth Stedman Jones, An end to poverty? A historical debate, New York: Columbia University Press, 2004, p. 49; R. Clyde White, ‘The social insurance movement’, Journal of the American Statistical Association, 38, 1943, p. 358.

28 Stedman Jones, An end to poverty?, p. 224.

29 Ibid., p. 235.

30 Henry E. Sigerist, ‘From Bismarck to Beveridge: developments and trends in social security legislation’, Bulletin of the History of Medicine, 14, 1943, pp. 365–88, reprinted in Journal of Public Health Policy, 20, 1999, p. 479.

31 Ibid.

32 Detlev Zollner, ‘Germany’, in Peter A. Köhler, Hans F. Zacher, and Martin Partington, eds., The evolution of social insurance, 1881–1981: studies of Germany, France, Great Britain, Austria and Switzerland, New York: St. Martin’s Press, 1982, pp. 17–22.

33 Ibid.; Rodgers, Atlantic crossings, p. 217.

34 E. P. Hennock, The origin of the welfare state in England and Germany, 1850–1914: social policies compared, Cambridge: Cambridge University Press, 2007, p. 153.

35 Zollner, ‘Germany’, p. 22.

36 Hennock, Origin, p. 156.

37 Gerhard A. Ritter, Social welfare in Germany and Britain: origins and development, Leamington Spa, Warwickshire: Berg, 1986, p. 37.

38 See Allan Mitchell, The divided path: the German influence on social reform in France after 1870, Chapel Hill, NC: University of North Carolina Press, 1991.

39 Sigerist, ‘From Bismarck to Beveridge’, p. 484.

40 William Franklin Willoughby, ‘Labor legislation in France under the Third Republic: part II’, Quarterly Journal of Economics, 15, August 1901, p. 566.

41 Quoted in Zollner, ‘Germany’, p. 13.

42 Ibid., p. 23.

43 Hennock, Origin, pp. 90–91; Zollner, ‘Germany’, p. 25.

44 Hennock, Origin, p. 91.

45 Gaston V. Rimlinger, Welfare policy and industrialization in Europe, America, and Russia, New York: John Wiley & Sons Inc., 1971, p. 125.

46 Ibid., pp. 126–8.

47 For interpretations of German Social Democratic policies in this era, see E. K. Hunt, Prosperity and prophets: the evolution of economic institutions and ideologies, 7th edition, Armonk, NY: M. E. Sharpe, 2002; and John H. Kautsky, Karl Kautsky: Marxism, revolution, and democracy, New Brunswick, NJ: Transaction Publishers, 1993.

48 ‘Part VI: international communications’, American Labor Legislation Review, 4, 1914, p. 163. This review was published by the American Association for Labor Legislation.

49 Mutsuko Takahashi, The emergence of welfare policy in Japan, Brookfield, VT: Avebury, 1997, p. 36, and p. 50, n. 10.

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53 Gaston V. Rimlinger, ‘The trade union in Soviet social insurance: historical development and present functions’, Industrial and Labor Relations Review, 14, 1961, pp. 397–418; Rimlinger, ‘Social security’, p. 110.

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55 Rimlinger, Welfare policy, p. 251.

56 Charles Richmond Henderson, ‘The logic of social insurance’, Annals of the American Academy of Political and Social Science, 33, 1909, p. 265.

57 Dr. Zacher, ‘German workingmen’s insurance and foreign countries’, American Journal of Sociology, 17, 1911, pp. 181–2.

58 Douglas Galbi, ‘International aspects of social reform in the interwar period’, Common Security Forum, Harvard University, 1993, http://www.galbithink.org/isr.pdf (consulted 30 November 2009); Ernst B. Haas, Beyond the nation-state: functionalism and international organization, Stanford, CA: Stanford University Press, 1964.

59 Cedric Guinand, ‘The creation of the ISSA and the ILO’, International Social Security Review, 61, 1, 2008, p. 81.

60 A. Abramson, ‘Social insurance in Soviet Russia’, Journal of Political Economy, 37, 1929, pp. 377–99.

61 Kenneth Duncan, ‘Social insurance in the Soviet Union’, Annals of the American Academy of Political and Social Science, 178, 1935, pp. 181–9; Rimlinger, Welfare policy.

62 Wang Jianmin, Zhongguo Gongchandang Shigao: Jianxi Shiqi (History of the Chinese Communist Party: the Jianxi era), Taibei: National Politics University, 1965, p. 409.

63 Anderson, Welfare policy; Takahashi, Emergence.

64 Rodgers, Atlantic crossings, pp. 409–46.

65 Strang and Chang, ‘International Labor Organization’, p. 256.

66 P. K. Sinha, Social security measures in India, New Delhi: Classical Publications, 1980, p. 26.

67 A. N. Agarwala, ‘The social security movement in India’, Economic Journal, 56, 224, 1946, p. 574.

68 White, ‘Social insurance movement’, p. 362.

69 Erna Magnus, ‘Social insurance in Nazi-controlled countries’, Political Science Quarterly, 59, 3, 1944, pp. 397–8.

70 Gregory J. Kasza, ‘War and welfare policy in Japan’, Journal of Asian Studies, 61, 2, 2002, pp. 424–5.

71 ILO, Approaches.

72 Rodgers, Atlantic crossings, p. 489.

73 S. Vijaya Kumar, ‘Economic security for the elderly in India: an overview’, Journal of Aging & Social Policy, 15, 2003, pp. 45–65.

74 Hu, ‘Social insurance’, p. 190.

75 G. A. Johnston, The International Labour Organization: its work for social and economic progress, London: Europa, 1970.

76 The US is often regarded as an exception, notably lacking a national health insurance system.

77 Cutler and Johnson, ‘Birth’, pp. 98–9.

78 Flora and Heidenheimer, Development of welfare states, p. 53.

79 See Adam D. Sheingate and Takakazu Yamagishi, ‘Occupation politics: American interests and the struggle over health insurance in post-war Japan’, Social Science History, 30, 2006, pp. 137–64; Yoneyuki Sugita, ‘Universal health insurance: the unfinished reform of Japan’s healthcare system’, in Mark E. Caprio and Yoneyuki Sugita, eds., Democracy in occupied Japan: the US occupation and Japanese politics and society, New York: Routledge, 2007.

80 Ewa Les, ‘Poland’, in Dixon and Macarov, Social welfare, pp. 157–9.

81 Ibid.

82 Carmelo Mesa-Lago and Sergio G. Roca, ‘Cuba’, in Dixon and Macarov, Social welfare, pp. 47–74.

83 John Dixon, The Chinese welfare system, 1949–1979, New York: Praeger Publishers, 1981, pp. 118–25.

84 John Dixon, ‘Social security and the ghosts that haunt it’, in John Dixon and Robert Scheurell, eds., Social security programs: a cross-cultural comparative perspective, Westport, CT: Greenwood Press, 1995, p. 8.

85 John B. Williamson and Fred C. Pampel, Old-age security in comparative perspective, New York: Oxford University Press, 1993, p. 172. On the social movements in French West Africa that provoked French concessions on salary and insurance for African workers, see Frederick Cooper, Decolonization and African society: the labor question in French and British Africa, Cambridge: Cambridge University Press, 1996.

86 E. J. Ejuba, ‘Social security developments in French-speaking countries south of the Sahara: trends since 1970’, in Report on the ILO/Norway African regional training course: for senior social security managers and administrative officials, Geneva: International Labour Organization, 1982, p. 102.

87 Ibid., p. 108.

88 Kumar, ‘Economic security’, p. 54.

89 By 2008, as planned, only nine countries continued to depend exclusively on CPFs for their old-age protection: six in Asia and the Pacific, three in Africa. See Martin Tracy, Social policies for the elderly in the Third World, New York: Greenwood Press, 1991, p. 104; Victor Gerdes, ‘African provident funds’, Industrial and Labor Relations Review, 24, 4, 1971, pp. 572–87; David C. Lindeman, ‘Provident funds in Asia: some lessons for pension reformers’, International Social Security Review, 55, 4, 2002, pp. 55–70; John Dixon, ‘A comparative perspective on provident funds: their present and future explored’, Journal of International and Comparative Social Welfare, 5, 2, 1989, pp. 1–28; Social security programs throughout the world, Washington, DC: Social Security Administration, 2008.

90 For a description and critique of neo-liberal policies, see Joseph E. Stiglitz, Globalization and its discontents, New York: Norton, 2002; see also David Harvey, A brief history of neoliberalism, Oxford: Oxford University Press, 2005.

91 Warren McGillivray, ‘Introduction: pension reform: where are we now?’ International Social Security Review, 53, 1, 2000, pp. 3–4.

92 Orenstein, Privatizing pensions, pp. 73–6.

93 Milton Friedman, Capitalism and freedom, Chicago, IL: The University of Chicago Press, 1962, p. 182.

94 Carmelo Mesa-Lago and Katharina Muller, ‘The politics of pension reform in Latin America’, Journal of Latin American Studies, 34, 2002, pp. 687–715.

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96 Martin Evans et al., eds., Change and choice in social protection: the experience of central and eastern Europe, vol. 2, Paris: ADECRI, Phare Consensus Programme, 1999.

97 Orenstein, Privatizing pensions, p. 73.

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99 Robert Holzmann, ‘The World Bank approach to pension reform’, International Social Security Review, 53, 1, 2000, p. 12.

100 Mesa-Lago and Muller, ‘Politics’; Ramadhani K. Dau, ‘Trends in social security in East Africa: Tanzania, Kenya and Uganda’, International Social Security Review, 56, 3–4, 2003, p. 35.

101 Stanford G. Ross, ‘Doctrine and practice in social security pension reforms’, International Social Security Review, 53, 2, 2000, p. 8.

102 Mesa-Lago and Muller, ‘Politics’.

103 Orenstein, Privatizing pensions, pp. 112–28.

104 Linda J. Cook, ‘State capacity and pension provision’, in Timothy J. Colton and Stephen Holmes, eds., The state after communism: governance in the new Russia, Lanham, MD: Rowman & Littlefield, 2006, pp. 121–54; idem, Postcommunist welfare states: reform politics in Russia and eastern Europe, Ithaca, NY: Cornell University Press, 2007.

105 K.G. Scherman, ‘A new social security reform consensus? The ISSA’s Stockholm initiative’, International Social Security Review, 53, 1, 2000, abstract.

106 Colin Gillion, ‘The development and reform of social security pensions: the approach of the International Labor Office’, International Social Security Review, 53, 1, 2000, p. 62.

107 Hu, ‘Social insurance’, p. 357.

108 Giuliano Bonoli and Bruno Palier, ‘When past reforms open new opportunities: comparing old-age insurance reforms in Bismarckian welfare systems’, Social Policy & Administration, 41, 6, 2007, p. 566.