Globalization and the decline of ‘social protection by other means’: the transformation of welfare regimes in Australia, Japan and Eastern Europe

Abstract

This chapter considers the consequences of globalization for patterns of welfare identified in the literature as 'social protection by other means' (SPM) (Castles, 1989). SPM refers to the fact that there are functional alternatives to the institutions typical of the Western welfare state, notably social insurance programmes for income security and medical care, and demand management policies to maintain employment. SPM, although not considered as a part of the formal system of social protection, nonetheless may perform broadly similar functions, viz. those of providing economic security and maintaining living standards. 1 In this chapter the implications of globalization for SPM are examined in three different settings: Australia, Japan and the post-socialist countries of Central and Eastern Europe (CEE). Each of these represents a system of welfare that differs significantly from what may be called the 'mainstream' post-World War II Western welfare state. In other words what we are exploring here is the transformation of three different welfare systems or 'regimes', viz. the Antipodean or the 'wage-earners' welfare state' represented by Australia, the East Asian or the productivist represented by Japan and the state socialist represented by the CEE countries, in the course of their encounter with globalization. Although post-socialist countries vary a good deal in terms of their economic, political and social conditions as well as the nature of transition from state socialism they have shared certain institutional patterns characteristic of state socialism. It is this systemic feature that justifies their being treated as a single category. What form did SPM take in these three different sites? In Australia it involved (1) economic protectionism, including tariffs and strict control over immigration, meant to nurture domestic industries and ensure plentiful employment, and (2) a system of compulsory wage arbitration meant to provide the working man with a living wage (Castles, 1989). In Japan SPM took the form of full employment and job security maintained through a system of lifetime employment, and enterprise welfare