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Markets, Planning and Democracy

Essays after the Collapse of Communism

David L. Prychitko

The essays contained herein span over a decade and reflect David Prychitko’s thinking about the role of the market system, and its relation to planning and democratic processes. The collection consists of previously published and unpublished articles written not only for economists but also for an interdisciplinary audience.
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Chapter 11: The Welfare State: What is Left?

Essays after the Collapse of Communism

David L. Prychitko


* When the Left, in Europe and America, can conceive of no solution to the crisis other than state-managed capitalism, and still looks to Keynes for remedies which, already ineffective under Roosevelt, have become inapplicable, then it is clearly about to die from lack of imagination. Andre Gorz (1985, vii) The autumn of 1989 ushered in the collapse of ‘really existing’ socialism. Previously, one would never have known from most leftist theoretical work that socialism was in such dire straits as to call its basic presuppositions into question. Now, with the massive shift of Western intellectual opinion away from socialism and toward the market-based welfare state, we seem poised to forget that it, too, is in serious trouble. Welfare programs, that, little more than a year ago, were widely considered to be deeply, if not intractably flawed, are now held up as models that Eastern Europe should emulate. On the Left, the formerly excoriated welfare state, once assumed to be an instrument of class hegemony, has suddenly found legions of new supporters.1 Jürgen Habermas and especially Claus Offe are among the few leftist writers who have attempted to offer a critical, systematic analysis of the welfare state. Offe, who upholds a sophisticated, post-Marxist methodological holism, has exposed the contradictory nature of welfare-state intervention in the market. His conclusions weaken the assumption that the welfare state is a viable corrective to the economic problems of capitalism. Yet Offe does not realize that implication of his work:...

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