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Welfare to Public Choice to Corporate Responsibility: Valuing the Care Economy

The views expressed are those of the author and do not necessarily reflect the views of ASPA as an organization.

By Nicholas Mastron
March 15, 2019

Traditional markets usually fail to capture the care economy or the household labor associated with familial duties. A predominantly female-led economy, the care economy tends to feature dependent children, but increasingly adults (i.e., disabled adults, elderly parents, etc.). The care economy encompasses a wide range of familial support activities, many of which remain uncaptured by any of the three models’ embedded value systems.

Though long acknowledging some concepts of a care economy, American public policy has transitioned from direct intervention and support toward promoting corporate enterprises to manage these societal needs. This shift of socioeconomic responsibility to the private sector raises several issues:

1) Reconstructions of institutional power.

2) Families’ decreased decision-making capacity.

3) Re-evaluations of social “worth” and the resultant economic disempowerment of mothers.

Sketching the Changing Social Values to the Care Economy

Adapted from the British colonies’ “poor” laws, the earliest forms of American welfare sought to give direct assistance. The first American welfare program, the Civil War Pension Program, provided immediate monies to Union widows, dependents, and disabled veterans to support all family economic activities without stipulation. This direct public assistance served as the first dominant model for supporting American families, as seen in the New Deal reforms, the post-World War II bills, and the later Great Society programs. While every iteration of these measures carried certain social values and exclusions, these public programs gave those specified families the needs to thrive without many limitations and stipulations.

However, alongside the Great Society programs, a new policy paradigm emerged: treating government as business, specifically applying microeconomic rational choice models to political expenditures. Positing that people choose their residency based upon public goods and services, public choice theory posits that families needing assistance suffer from public goods’ misinformation and public services’ misalignment to their families’ values. Resulting de-federalizing assistance initiatives impacted the care economy, including cutbacks to food stamps, state block grants to Medicaid and reorganizing job training programs. Here, these policies distill a social value more than in previous eras: a diversity of state public support options better equates to American families’ successes.

Now, a third shift in privatizing the American care economy, most notably corporate social responsibility initiatives, responds to the previous competing social values’ gaps. The direct public assistance model provided a much broader base of support without much direction. Whereas the public choice model used a more tailored approach toward upward opportunity and mobility. The corporate assistance model acts more locally, seeking to develop specific partnerships on specific initiatives to better improve American families and communities.

Though no doubt a different approach, do the embedded social values of this privatization shift actually address the needs and empower the care economy?

Privatization Impacts to the Care Economy

On the surface, this evolution, from federal public assistance to quasi-state/local competition to now corporate partner programs, illustrates a reconstruction of government’s role in helping families capture these care benefits. Federal departments and agencies that once supported the care economy have surrendered authority to states and localities, who argued that they better knew what assistance families needed. However, these states and localities are now surrendering these responsibilities to larger corporations. While the private sector has always contributed to the American care economy, this transition of direct institutional power lets boardrooms and chief executives, instead of democratically elected leaders, support only the social values they desire.

A second major impact to the care economy comes from a decreased ability to make caring decisions. One could argue that caring for a family is now less about what they need and more about what can be identified as a source of support. This argument holds even more credence when considering the various groups largely excluded from the various assistance schemas, such as minority groups and families with means already. Furthermore, income inequality further determines what decisions family care leaders can make and, to an extent, who can make them.

Regarding the values embedded in all these assistance models, American society has and continues to view providing social assistance to the care economy as only out of necessity rather than on the merits of care itself. The United States government initially sought to create larger programs to target specific “worthy” groups of citizens. Then, those values shifted into more confined geographies due to libertarian ideals of families’ freedom of opportunity and state/local competition. These values morphed into viewing the firm as a quasi-governmental arm and essentially a patron of designated family care archetypes.

Perhaps most negatively, the trend toward social corporate responsibility fosters crowding mothers out economically by redirecting funds toward public-private partnership social initiatives, benefit corporations, and corporate public incentives. These incentives’ tax expenditures redirect monies that ordinarily would be directed toward longstanding support programs to the care economy. Returning to the fact that women tend to lead the care economy, and given female pay and wealth inequities, women face a true economic disempowerment in supporting their families.

While this long-run shift has more honestly exposed underlying social values toward the care economy, this public revelation comes at the cost of American families, particularly to the women who lead them.

Author: Nicholas Mastron is a current Ph.D. student in Public Policy & Administration at the George Washington University, where his field specialization is Gender & Social Policy. His current research interests are intimate partner violence, intersectional income inequality, coordinated community responses, campus sexual assault, small business entrepreneurship and regulatory affairs, state and local economic development, energy economics, and sports financing.

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