Process of Policy Formulation

Social Welfare - a Measure to Control the Poor b Short supply of labor force due to Black Death b Creation of the Statute of Laborers in 1349 that regulated the movement of laborers b Government control over employment -work or jail b Peasants’ Rebellion of 1381 b Statute of Artificers enacted in 1388 in England prevented movement from place of birth without permission b Increase in population, enclosure movement, lack of raw materials, low wages and inflation coupled with high unemployment b Production of trade goods and money economy which involved accumulation of profits beyond the cost of raw materials, labor and investment b Dawn of capitalism and social welfare became part of the labor policy b Work became a moral issue; responsibility for poverty was placed on the worker’s shoulders b Calvinism and the Protestant work ethic b Elizebethan Poor Laws of 1601-almshouses and workhouses

Questions for consideration in policy formulation b Is the policy compatible with the current mood of the nation? b Does it reflect the prevailing values in society? b Is it a politically viable policy? Will it create an uprising or other social/political problems? b Is it legally sound? Rational? Based on empirical data? b Will it satisfy the predominant interest groups? b Does it promote justice and equality? b Is it an economically feasible policy that provides the best option among other options available? Is it efficient?

History of Social Welfare Policy b Feudalism and embeddedness-obligation of honor b Population increase and emergence of agricultural technology b Reduction of profits for the Lords- emergence of tenant forming b Individualism and alienation - the cessation of obligation of the Lords to protect the serfs b Mechanization and Lords’ control of equipment such as grinding mills which monopolized the use of labor saving devices and the emergence of user fee b Church’s deep involvement in governance and distribution of charity b Continuation of private charity and the service by the clergy, and the guilds b Displacement of agricultural workers, growing piecework industry, hard work routines, population increase and famine resulted in associating the poor with moral degradation and witchcraft b Poverty became a crime

Social Security-A drowning Ship? b Is the most expensive program in jeopardy because of the reduced dependency ratio or because of COLAS? b Will means testing the program save the drowning ship? b How to assure intergenerational equity? b Can it become a targeted program? b Can the tax system be used to reduce the stigma if means test becomes a criteria to receive benefits from social security? b How can SSI and SSD be effectively used to meet the needs of poor social security recipients?

What is social security? b Designed to help deal with economic insecurity b Income maintenance program that helps offset the income losses that accompany disability, death or old age b Principles of : UniversalityUniversality EquityEquity AdequacyAdequacy Less stigmatizationLess stigmatization Saving IncentivesSaving Incentives IntegrationIntegration

Is social security a “chain Letter”? b Declining rates of return b Poor sustainability of benefit promises b Universality principle that favors the wealthy b Younger generation worried about inability to keep promises by the government b Political nature of the issue b Public discourse based on inaccurate information b Entitlement security b Perverse incentives b Actuarial uncertainty

Cost Effectiveness b A method for quantifying costs of services in relation to the goal achievement. b No monetary value is placed on the desired goals