Also by Ronald M. Glassman * THE NEW MIDDLE CLASS AND DEMOCRACY IN GLOBAL PERSPECTIVE. * From the same publishers

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1 Caring Capitalism

2 Also by Ronald M. Glassman BUREAUCRACY AGAINST DEMOCRACY AND SOCIALISM (co-editor) CHARISMA, HISTORY, AND SOCIAL STRUCTURE (co-editor) CHINA IN TRANSITION: Communism, Capitalism, Democracy CONFLICT AND CONTROL: The Challenge to Legitimacy of Modern Governments (co-editor) A DEMOCRACY AGENDA FOR THE YEAR 2000 (co-author) DEMOCRACY AND DESPOTISM IN PRIMITIVE SOCIETY DEMOCRACY AND EQUALITY FOR DEMOCRACY: The Noble Character and Tragic Flaws of the Middle Classes (co-author) MAX WEBER S POLITICAL SOCIOLOGY: A Pessimistic Vision of a Rationaled World (co-editor) THE MIDDLE CLASS AND DEMOCRACY IN SOCIO-HISTORICAL PERSPECTIVE * THE NEW MIDDLE CLASS AND DEMOCRACY IN GLOBAL PERSPECTIVE THE POLITICAL HISTORY OF LATIN AMERICA A WEBER MARX DIALOGUE (co-editor) * From the same publishers

3 Caring Capitalism A New Middle-Class Base for the Welfare State Ronald M. Glassman Professor of Sociology William Paterson University New Jersey

4 First published in Great Britain 2000 by MACMILLAN PRESS LTD Houndmills, Basingstoke, Hampshire RG21 6XS and London Companies and representatives throughout the world A catalogue record for this book is available from the British Library. I S B N I S B N ( e B o o k ) D O I / First published in the United States of America 2000 by ST. MARTIN S PRESS, LLC, Scholarly and Reference Division, 175 Fifth Avenue, New York, N.Y ISBN Library of Congress Cataloging-in-Publication Data Glassman, Ronald M. Caring Capitalism : a new middle class base for the welfare state / Ronald M. Glassman. p. cm. Includes bibliographical references and index. ISBN Capitalism Moral and ethical aspects. 2. Free enterprise Moral and ethical aspects. 3. Welfare economics. 4. Middle class. I. Title. HB501.G '2 dc Ronald M. Glassman 2000 S o f t c o v e r r e p r i n t o f t h e h a r d c o v e r 1 s t e d i t i o n All rights reserved. No reproduction, copy or transmission of this publication may be made without written permission. No paragraph of this publication may be reproduced, copied or transmitted save with written permission or in accordance with the provisions of the Copyright, Designs and Patents Act 1988, or under the terms of any licence permitting limited copying issued by the Copyright Licensing Agency, 90 Tottenham Court Road, London W1P 0LP. Any person who does any unauthorised act in relation to this publication may be liable to criminal prosecution and civil claims for damages. The author has asserted his right to be identified as the author of this work in accordance with the Copyright, Designs and Patents Act This book is printed on paper suitable for recycling and made from fully managed and sustained forest sources Printed and bound in Great Britain by Antony Rowe Ltd, Chippenham, Wiltshire

5 Contents Preface: Why `Caring' Capitalism? Prologue: The Productive Miracle and the Specific Pattern of Social Problems Engendered by It 1 The High-Technology Economy of Abundance: Goods vs Services 2 The Specific Pattern of Social Problems Linked to the New Middle Class 3 The Working Class Divided: New Middle Class Mobility vs Underclass Decline 4 The Specific Pattern of Social Problems Engulfing the Global Underclass vi The Social Problems of the New Upper Class 64 6 The Welfare State for the New Rich 75 7 The Welfare State: Expansions, Cutbacks and Co-Payments 98 8 The Rising Cost of Services in High-Tech Societies and Revenue-Generating Mechanisms 9 Why Transfer Payments are Necessary in High-Tech Industrial Capitalist Societies The Free Market and Morality Religious and Secular Curbs on the Selfishness and Amorality of the Market Epilogue: Why Care? Notes Index v

6 Preface: Why `Caring' Capitalism? Everywhere I travel in the world, people are excited about the new hightechnology production system. Everyone walks around with cell phones, wears designer clothes, drives fast, comfortable cars, watches television and movies. In Hong Kong and Singapore, in Frankfurt, and Paris, in London and New York, in Sao Paolo and Cairo, modern citizens of the `global village' exult in the newfound consumer economy and its dazzling lifestyle. But the global villagers are also perplexed ± worried about the new social service needs that seem to accompany the high-tech economy: child-care needs for working couples, elder-care facilities for infirm senior citizens, burgeoning health-care costs accompanying high-tech medicine, college tuition and nursery school payments, and more. It seems that global capitalism is succeeding remarkably, as an economic system, but that it has generated a set of social service needs that are as expansive and expensive as the consumer products. Yet, there has been a global response to these new social service needs, and this volume will present and analyze that response. For a new phenomenon may be emerging, and as contradictory as it may appear, a kind of `caring capitalism' may arise, worldwide. The term itself, `caring capitalism', was coined by a group of socialwork scholars at the City University of Hong Kong. There, with the Communist Chinese takeover hanging over them, the Hong Kong Chinese were determined to show the mainlanders that the free market economic system could not only generate the world's most efficient and productive economic machine, but that it could also provide a full set of social services for the emerging new middle class, and the inmigrating rural poor. This book explores the various attempts around the globe to create a system of `caring capitalism' ± and why modern nations have been pressured by the new middle class to do so. vi