Liberalisation increases inequalities and weakens the allies of egalitarian social policy. The rise of the welfare state was led by powerful, usually industrial, trade unions and left political parties, often with middle-class or agrarian support (see Baldwin 1990; Manow 2009). It was the product of political-economic struggles, inspired by the possibility of moving beyond capitalism. Those driving the welfare state were organised around their role in the economy and particularly their role in industrial production.

The welfare state's origins do not lie directly in efforts to reorganise how we care and educate. They instead lie in efforts to protect workers and their families from the insecurities of an industrial economy. The organisation of the welfare state reflects strategies and ‘statecraft’ developed alongside ideas of macroeconomic management designed to ‘democratise’ industrial capitalism. This Keynesian welfare state, discussed in Chapter 1, distinguished between a private sector of market production regulated by competition and a public sector determined by democratic norms. Liberalisation weakens the welfare state by both extending competition to previously democratic, public spaces, and weakening the traditional political allies of the welfare state – industrial unions and socialist parties.

Of course, liberalisation in Australia has been uneven. The last chapter drew together examples of social policy expansion and renewal that took place alongside more conventional processes of residualisation, marketisation and financialisation. Exploring those examples, I argued policy success was associated with forms of hybridity, in which new proposals mimicked elements of liberalisation – advancing competition alongside redistribution and minimising (apparent) fiscal costs. Proposals did this by combining elements of state distribution and market exchange in ways that tended to socialise risk and appeal to universal principles of need and provisioning.

Hybridity is not straightforwardly egalitarian. All the examples outlined in the previous chapters opened space for erosion or complicated calls for further reform. But they successfully respond to the context of liberalisation, allowing egalitarian social provision to expand against the odds.

Well-designed policy, however, was not enough to constrain inequality. The boldest reforms were achieved when hybrid policy models combined with strong movement pressure. Unions struck in favour of Medicare and feminists organised behind family spending. If the traditional allies of the welfare state are becoming weaker, what does this mean for welfare state politics?