V.

ECONOMY, LABOR, AND WELFARE

Economy

"My father taught me to work, but not to love it." (Abraham Lincoln)

The American economy had to be built, as they say, from the ground up. Those immigrants who were
not willing to work hard – or work with their hands as well as their heads - seldom did well in 5 the
New World. In the beginning, of course, there were simply no farms or houses or factories. Whatever
was needed had to be made by the settlers themselves. Or it had to be imported at great expense.
The tremendous ingenuity and 10 inventiveness of Americans has been traced to this pioneer time
and spirit. "Do-it-yourself,” then, is hardly a recent trend or a middle-class hobby in America. There
were few skilled crafts- men available and no established class of agricul- is tural workers, or
peasantry. Therefore, if a new way to do the work couldn't be found, it just didn't get done.

What was achieved in the first hundred years following independence is amazing. By 1890, for
example, the U.S. was producing more iron and 20 steel than Great Britain and Germany combined.
By 1900, according to several criteria, the U.S. had become the greatest industrial nation, and its
citizens enjoyed the highest standard of living in the world. In 1913, the United States accounted 25
for more than a third of the world's industrial production. By the post-World War II era, the United
States was producing 50 percent of the "gross world product." Today, the American economy no
longer dominates the world as it 30 clearly did then. But with only about 5 percent of the world's
population and about 6 percent of its land area, the U.S. still produces around 25 per- cent of the
world's industrial products, agricultural goods, and services. America has not dropped 35 behind
other nations: its gross national product

The changing face of industry. Smokestacks are replaced by high-tech plants in attractive
environments. The buildings on the right are in Silicon Valley, near Palo Alto, California.

(GNP) has tripled since the end of the Second World War. Rather, the rest of the world has caught up,
or closed the distance.

Despite its fears - often voiced - that it is no 5 longer at the top in almost every area, America
remains the world leader in a great many. Among these are, for instance, biochemical and genetic
engineering, aerospace research and develop- ment, communications, computer and informa- 10
tion services, and similar high-technology fields. In such areas American companies are faced with
intense competition throughout the world, some- times from foreign firms which are supported by
groups of nations and their governments. Still, 15 America's private industries are doing quite well.
American firms which sell passenger aircraft or computers retain the largest share of the world
market. Similarly, many countries now have their own Silicon valleys, but the first and biggest com-
20 puter research and production area is still Silicon Valley, near San Francisco, where some 4,000
high-tech firms are located. And the best-selling car in the world is a Ford (the Escort). In the poker
game of international business, foreigners 25 still choose to put their money in the American game
first. Foreign investment in the U.S. in 1984 amounted to some $164 billion, with the United Kingdom
($38 billion), the Netherlands ($33 bil- lion), Japan ($16 billion), Canada ($15 billion), 30 and and
West Germany ($12 billion) as leading investors.

While its industrial and technological skills are well known, what many people, including Ameri- cans,
don't know is that the United States is also 35 the world's leading agricultural nation. America is by
far the biggest supplier of grains, growing about 20 percent of all the world's wheat, corn A typical
farm in the Midwest.

Fig

(maize), oats and sorghum. Similarly, American farmers and ranchers are responsible for 14 per- cent
of the world's dairy products, 17 percent of 40 all its meats, 27 percent of its vegetable fats and oils,
and over 60 percent of its soybeans. This is surprising, because America's share of the world's land
that can be used for farming is less than percent, and because only a tiny propor- 45 tion of
America's total population (less than 3 percent) is involved in agriculture. America not only feeds her
own people one of the few countries that does so but a great many other people in the world as
well. This is true, even 50 though other countries such as the Soviet Union and China have more land
under agriculture and more people working on it. Exports only account for less than a tenth of
America's gross national product, but of this amount, almost one-fifth 55 comes from agricultural
goods.

A problem facing American farmers is, in fact, that they produce much more food and agricul- tural
products than ever before. The 1985 corn crop, for example, was the largest in history, and 60 there
are enormous excesses of wheat, rice, soy- beans, and milk as well. Despite the dramatic decrease of
the American farm population-from 23 percent of the total population in 1940 to less than 2.5
percent in 1985 - the agricultural output 65 has increased more rapidly than the demand. This has
lowered the price of agricultural products, and some farmers who bought more land or equipment
when prices were higher are now in difficulty. Some 50,000 of the nation's 2.3 million 70 farmers
were forced to quit farming in 1985. Although this is only about 2 percent of all farm- ers, it received
very much attention in the media, because Americans have always held a romantic image of the
family farm. The small family farm 75 might not be economical in an age of “agrobusi- ness," but it
still has the sympathy of most Ameri- cans in much the same way the corner “Mom and Pop" grocery
store once did.

Many reasons have been offered to explain 80 why the U.S. has been able to go from a small,
struggling economy to the leading industrial and agricultural nation in such a short time. One rea-
son, obviously, is its size and natural resources, but these alone do not account for its progress. 85
Other countries share these, and some are su- perior in both. America's vitality, its so-called

ment. Aware of this motivation, many firms in the U.S. today hire the best and brightest young
minds, leave them alone with plenty of support and research facilities, and let them develop their s
own ideas. Even if only a few come up with something of interest - as did three Bell Tele- phone
Laboratories researchers in 1948 when they invented the transistor - the investment has been worth
it.

Many Americans prefer to be their own bosses, and they are willing to trade security for the chance
of "making it." Some 10 million Ameri- cans owned their own businesses in 1984, and four times that
number (some 42 million) owned a 15 part of businesses and industries through stock. Yet, despite
its own claims, America is far from being a "free enterprise" market. Anyone trying to start a business
is faced with many regulations, restrictions, and laws from all levels of govern- 20 ment, federal,
state, and local. The federal gov- ernment sets laws concerning working condi- tions, transportation,
minimum wages, and work- ing hours (the minimum legal wage in 1987 was $3.35 per hour).
Environmental protection and 25 equal employment laws in the United States are among the
strictest in the world. Such laws and regulations, standards and requirements repre- sent the
greatest contrast of the present business climate with that of the past.

If friendly reminders to "keep America clean" don't work, fines may. This California highway sign
warns drivers that littering may cost them dearly.

The American blue-collar worker is among the 30 highest paid in the world, and his benefits and
pensions also make him one of the most expen- sive. The average production worker in the U.S.
earned $9.50 an hour in 1985, the highest wage of any production worker in the industrial West. In
35 addition, many firms in the United States have profit-sharing plans for their employees. Through
these agreements, employees receive a certain percentage of the profits the company makes. Profit
shares may be paid out in cash or company 40 stock at the end of the fiscal year or may be put into a
trust fund and distributed to participants at retirement ("deferred plan"). This kind of profit- sharing
started in the U.S. in the early 20th cen- tury. Proctor & Gamble began its profit-sharing 45 plan in
1887, Eastman Kodak Company, and Sears, Roebuck & Company followed in 1912 and 1916. In 1984,
some 20 million Americans participated in plans to receive a share of com- pany profits. In addition,
around 82 percent of so American workers in medium-sized and large firms were covered by a
retirement pension plan from their firms.

Recently a new trend has emerged which at- tempts to put employees and employers on much ss the
same level. In some firms all employees own a part of the company and do all kinds of jobs. But all
share in the profits or losses as well. This

Soft-drink can with ring that cannot be thrown away. Several states have introduced deposits on
cans, which has greatly reduced littering.

e. Gener

"Every twenty minutes, another small farmer disappears. You're next.'

""

to

spirit of enterprise and initiative, has certainly played an important role. The American system of
government, too, has encouraged citizens to vigorously pursue their own economic interest. 5 The
rapid progress of American industry and agriculture may also be traced to a characteristic which has
often been called typically American. This is the constant willingness to experiment, combined with
the desire to find new solutions to 10 old problems. Social and geographical mobility have also
played a part. When the older "smoke- stack" industries in the Midwest had problems, people
moved - and were willing to move areas where they could find jobs. They were also 15 willing to be
trained for new ones. California and Texas are now the leading manufacturing states in America
(California is also the largest agricul- tural producer). More than half of the over 100 million
Americans in the work force in the mid- 20 1980s were in white-collar jobs, with an addi- tional 13
percent or so in service occupations. In spite of an economic depression and an unem- ployment rate
of close to ten percent in the early 1980s, the American economy managed to create 25 more than
ten million jobs between 1982 and 1985. This is largely a result of the some three million new
businesses which were started in just five years. The unemployment rate in the mid- 1980s was down
to around seven percent. While 30 this was certainly not good, it compared favor- ably with most of
the other major economies.
American business and industry has also greatly benefited from the major universities, their basic
research, and their willingness to sup-

60

port talent. Significant, too, has been "the spirit of 35 enterprise," in other words, taking a chance on
both people and ideas, and letting those who are willing to work try to make something work. Unlike
the tough old industrial barons of the 19th century, American entrepreneurs today are likely 40 to be
young, adventurous, and well-educated. Above all, they are willing to take risks to achieve success.
They are helped in this by that strange mixture of teamwork and competition, that ap- preciation of
experience and expertise, which 45 marks American business. Despite their emphasis on the
individual, Americans often work well together in small groups. They respect the person with
practical experience, with "dirt under his fingernails," as well as the expert with the Ph.D. 50 after his
name.

It is often the challenge, the desire to create something new or better, rather than the material
results that motivates Americans, with financial success being merely an outward sign of achieve- 55

The South has become a very attractive site for both old and new firms.

Helping The Goose Produce.

Profitable barsiness is the goose that lasts, the golden egg. Ju South Canolina, we be committed to
helping 1lac goose produes. We always have

Back when doliars were hard to fnd, we scrimped and scraped to bund America's most advanced
employee traming program When Innes were tough, we went the extra male to establish tax
mcentives to help mdustry grow When office states were accumulating debt, we stuck to our
constitutionally mandated balameed budget

Now other states are beginning to offer some of the "relocation meentives" we've been offering all
along. But as business has found before...government incentives can be here today and gone
tomo1TOW.

What commits, us aftatuadix sdaloids, count the thongs which have always mad, South Carolina
discut The mitoneable s which negova etmeni a gun hangs In the lab patient arved killed the goose
that and the ngodde in a gat. And in main places, they still do. But not in South molina Beans wood
for businesses IN THE DHE bloot 10always far been it always Walled South Carolina

The Environment

The conservation movement – the protection of natural resources and wildlife – was first formu-
lated and implemented as a political program in the United States. That this happened relatively
early, during Theodore Roosevelt's administration (1901-1909), meant that later generations of
Americans could still enjoy their country's natural wonders.

It was very difficult for many Americans to believe that their continent-sized nation with its
enormous forests, thousands of lakes, rivers, and streams, and vast wilderness areas could have the
problems which many smaller and more crowded nations faced. True, Los Angeles obviously had a
problem with air pollution, but there was still nothing anywhere like the "killer smog" which caused
some 3,500-4,000 deaths in London in December 1952. Similarly, the U.S. had such enormous
resources, that it was hard to imagine they could ever be exhausted.
Starting in the early 1960s, however, Americans finally realized that this was not true, that the U.S.
was in danger of destroying many of her national treasures. What was happening to Lake Erie, the
shallowest of the Great Lakes, is a good example. City and industrial wastes, chemicals, and fertilizers
were endangering the once enormous stocks of fish. Suddenly, it seemed, the lake was almost
"dead," and the millions who used its sandy beaches and fished its waters were shocked that this
could have happened.

At much the same time, other problems began to receive great publicity. For example, the best-
selling book by Rachel Carson, Silent Spring, brought home the dangers of DDT and other
insecticides. Environmental activists like Ralph Nader and his corps of volunteers and lawyers
stressed the problems caused by industrial pollution and the automobile. Long-established environ-
mental groups such as the Sierra Club warned that acid rain (first described by a European scientist in
the mid-19th century) threatened many American forests. The media started to campaign against the
ugliness of billboards, tin cans, and trash in “America the Beautiful.”

This surge of attention led to a substantial number of laws in the 1960s and 70s, and to the
establishment of several federal agencies. Because the environmental movement in the United
States has never been associated with one political party or group, it has been able to gain
widespread trust and support.

Federal laws such as the Clean Air Act (1970), the Water Pollution Control Act (1972), and the
Endangered Species Act (1973) - to name only a few - led to many specific improvements in the
environment. For example, DDT was banned in 1972, catalytic converters and unleaded gas were
introduced nationwide in 1975, and chlorofluorocarbon, the gas used in many spray cans, was
forbidden in 1978. The Federal Drug and Food Administration's (FDA) standards for food and
medicines are among the strictest in the world. The positive image that most Americans have of the
FDA was strengthened when it banned the drug thalidomide in 1961, and thus saved many American
children from the tragedy of severe birth defects.

All of the states, of course, have implemented their own laws, some, for instance, having banned
throw-away bottles and cans, forbidden the use of phosphates in soaps, and passed strong laws
against the industrial dumping of wastes. By 1986, forty states and more than 80 cities and
communities had passed some type of law to restrict smoking in public or at work. Likewise, all
federal government departments and agencies must restrict smoking in most office areas. Beginning
in 1965, a law passed by Congress required warnings on cigarette packages, a measure that was
adopted in other countries only years later.

Public attention to the problems of pollution has now become part of American life. Even the familiar
Coca Cola can has been affected. Today, by law, these cans must be made so that the rings on top
can't be thrown away. arrangement seems to give great incentive to employees.

If one looks at America's industrial history, such developments are not surprising. Henry Ford became
famous for his use of mass production techniques. Perhaps more revolutionary, however, was the
fact that, in 1914, he offered his workers a daily wage of $5.00 at a time when the national average
was $2.40 and reduced the working day from nine to eight hours. The result was astounding: while
mass production reduced the price of cars (Ford's Model T, the famous Tin Lizzie, cost $850 in 1908,
but only $350 in 1926), better wages meant that more people could afford one. Millions of average
Americans had cars

Ford alone had produced almost 30 million by the end of the 1930s - when elsewhere they remained
luxuries or toys for the rich. This tendency to make new products available to and affordable for
everybody is one obvious reason why American business has usually been sup- ported by average
Americans.

Another reason for this widespread support of business has been the tendency of the "very rich" in
America to give away much of their money before they died.

American tycoons such as the Carnegies and Rockefellers, the Fords and Guggenheims, gave much of
their wealth to charity, to hospitals, universities, libraries, museums, art galleries, and educational
foundations. Carnegie, for example, felt that "the man who dies rich dies thus disgraced." During his
lifetime, he gave away $370 million of his estimated $400 million "for the benefit of the community."
This included enough money, for instance, to build 2,800 free public libraries. He was helped along-
as corporations and the rich are still today - by America's tax laws. Simply stated, it is better to give
money away to charities and other nonprofit organizations than to give it to the government in the
form of taxes. Today, there are some 200,000 foundations, large and small, throughout the U.S.
which fund research projects, support the arts, and contribute to various charitable and public
causes.

Few Americans like "big business," however. Starting with Theodore Roosevelt's administration
(1901-1909), governments have broken up large corporations and monopolies. The first to be
affected by "deregulation," that is, the removal so of legal and administrative restrictions, were the
big steel firms and the railroads. This process has continued to the present with the deregulation of
banks and communications. A recent example is the airline industry. Deregulation has created 55
enormous competition among American airlines. As a result, there are some 400 airlines in the U.S.
today, of which 100 fly on interstate or international routes. Another example of this tendency to
encourage competition by lifting restrictions is the transformation of the publicly regulated tele-
phone company AT&T (American Telephone & s Telegraph) into several smaller companies. Generally
speaking, while the companies are not happy, the average citizens are. More airlines are now in
competition for passengers, and several telephone companies now offer different services and long
distance rates. Even the United States Postal Service is now in competition with private companies.
Americans believe that "fat-cat" companies and businesses tend to get lazy and pay less attention to
their customers. They are convinced that a choice of goods and services makes for better and
cheaper ones.

Labor

Labor laws, labor relations, and unions have a somewhat different history in the U.S. than they have
had in other western industrialized countries. The main reason is that in America, employer and
employee relations were not as much a battle between classes and sociopolitical philosophies as
they were in other countries. The Ameri- can worker has usually fought for "a bigger piece of the
pie," better working conditions, and better health and retirement benefits, rather than social status,
or mobility. His boss often didn't have a much different background than he did. The major difference
between the employer and the employee was neither accent nor social class, but money and what it
could buy.

Other developments particular to American history were also important. For a long time there was a
shortage of labor, especially of skilled workers. Most qualifications were acquired through experience
on the job rather than formal training, and the skilled craftsman was in demand. As a result, wages
were usually much higher in the United States than they were in Europe. As towns grew and the
demand for manufactured goods rapidly increased, work- shop owners began hiring more helpers to
in- crease production. Soon workshops turned into factories and more and more workers were
needed. Because many employers were in competition for employees, workers were often able to
get better wages and working conditions than would otherwise have been the case. This, too,
delayed the organization of labor unions. Al- though unions began to form before 1800, especially in
the skilled trades, it was not until 1842 that workers in large numbers organized into labor unions.

In the mid-19th century, the rapidly growing industries were able to employ the hundreds of 55
thousands of immigrant workers who poured into the cities, and the situation quickly changed. Many
workers had to take whatever jobs they found at whatever wages were offered. Bad working
conditions and overcrowded housing often 60 sparked protest and confrontation between employers
and employees, workers and the police. The most violent of these confrontations between labor and
employers was the Great Railway Strike of 1877. Striking workers in Pittsburgh 65 blocked freight
trains to protest wage decreases. Federal troops and militiamen were called in to clear the tracks. In
the course of the battle that resulted, a number of workers were shot and some 2,000 railroad cars
were burned.

The labor movement gained its greatest momentum between 1860 and 1900, the period in which
the U.S. started moving from the towns to the cities, from the farms to the factories. This was 5 also
the time of many political reforms. America's literature, too, turned increasingly to "muck- raking,"
that is, strongly criticizing social conditions and pointing out the obvious sins and fail- ings of big
business and industry. Altogether, in 10 the ten-year period between 1880 and 1890 there were
some 10,000 strikes. Many of these strikes were violent on both sides, with the forces of government
more likely to be siding with business.

As late as the 1930s, violent strikes were not uncommon. In the automobile industry, for example,
there were many violent confrontations and sit-down strikes before the companies accepted the fact
that unions were there to stay. 20 Major legislation during the 1930s, however, brought many long-
overdue benefits to American workers. The Social Security Act of 1935, for instance, created a system
of government sponsored unemployment insurance and old-age pensions, and the Fair Labor
Standards Act regulated wages and working hours. By then, the unions had become forces that could
not be ignored.

In 1886, several unions of skilled workers came together to form a central union, the American
Federation of Labor (AFL). Four years later, it 30 had some 500,000 members, and by 1904, it had
1.75 million members. At this time, although many workers in Europe were joining revolution- ary
labor movements, most American workers were not interested in destroying the basic system, but in
reforming it for their own benefit. They were most concerned, for example, with the day- to-day
welfare of workers and their families. The AFL's approach to labor problems was so-called "bread and
butter" unionism. The union demanded higher wages and fewer working hours; a greater share in
the wealth that they helped to produce. By the end of World War I, the federation had 5 million
members. By 1955, when the AFL joined together with the CIO (Congress of Industrial Organizations)
to form one large group of unions representing skilled and unskilled workers, the active membership
had reached 15 million.

The industrial unions were most powerful in the period immediately following World War II. In all the
major industrial areas and industries in the United States, union membership was required. Nothing
was built, made, manufactured, transported, shipped or moved without the agreement of the
unions. States that were not fully unionized, where workers did not have to become union members
to do certain jobs, might try to attract industries with the promise of lower wages and taxes. But a
car company that wanted to 5 assemble automobiles in the South, for instance, could not do it if the
engine factory in Detroit, Michigan went on strike. In 1947, Congress passed the Taft-Hartley Act.
One of its provisions outlawed the "closed shop" which required employers to hire only union
members. It also per- mitted the states to pass “right to work” laws which forbade agreements
requiring workers to automatically join a union after they were hired. Nonetheless, union
membership remained a requirement in many states and industries, if no longer by law, then by
practice. In 1985, for example, 95 percent of all General Motors employees were union members and
90 percent of all Ford employees.

Today, some industrial firms have been at- tracted to locations in states where labor unions are not
so strong, where wages are often lower, and where safety and pollution regulations are not so strict
or so strictly enforced. The decline of 25 some industries, such as the steel industry, along with the
rise in the number of white-collar, technical, and service jobs has also harmed the traditional, blue-
collar unions. Yet, at the same time,

Striking teachers in Chicago (1979) demanded more job security, smaller classes and a higher
income. Note the signs in Spanish in the background. The American Federation of Teachers has close
to half a million members and is affiliated with the AFL-CIO, the umbrella organization of American
labor unions groups such as teachers, firemen, and even policemen have formed unions of their
own.

Twenty or thirty years ago, it would have been shocking for these civil servants to strike for their
demands. Today, Americans have learned to tolerate these strikes, too. Schools in some areas such as
Chicago have remained shut as the result 35 of teachers' strikes for up to three months. Parents who
suddenly found their children at home all day put great pressure on city officials to settle the strike.
Firemen and policemen have also gone on strike in many areas, sometimes "illegally," but 40 usually
quite effectively. A now popular form for the policemen's strike is the "Blue Flu." The policemen, in
their traditional blue uniforms, all become "ill" on the same day. Amazingly, just enough policemen
needed to prevent a disaster 45 always remain "healthy." In 1980, there were close to 4,000
industrial disputes and a total of 33 million man-days lost due to strikes.

While there are more and more professional and technical unions, the many other industrial 50
unions face the same problem that other unions in the western world do. This is what can be done
about those jobs that will no longer exist in com- panies adopting modern technology, or in indus-
tries which are no longer competitive.

Some unions have decided that job security is more important than pay increases. For the first time
in their histories, a few have actually ac- cepted lower pay to help save a company. This happened,
for example, in 1980 with Chrysler. 60 Employees agreed to take a reduction in their wages to
prevent large-scale layoffs and help the company to become profitable again (which it did). This,
however, is very much the exception. Most unions still demand agreements which call 65 for a
shorter work week. And most agreements include "fringe" benefits such as medical and life
insurance, profit-sharing, pensions, and health- care plans. In 1983, almost 75 percent of Ameri- cans
(men, women, and children) were covered 70 by private or government health insurance, 60.7
percent (over 140 million Americans) by insurance related to employment. Many Americans were
thus covered by two insurance systems. Still, some 35 million Americans (or 15.2 percent) were 75
not covered by any health insurance.

In other areas of business, however, companies do not need to be forced to the bargaining table.
They are worried about losing good employees to their competitors. This is especially a problem in
many high-technology industries and businesses. Many of these firms, therefore, try to keep highly s
skilled employees by offering them benefits and working conditions without unions having to
demand them. In addition to various profit-sharing and pension plans, many large corporations offer
their employees the use of swimming pools and 10 golf courses, or art classes, and free day-care

centres for their children. Today, the word "head hunters" does not refer to people who track down
criminals, but those independent agents who lure away a company's best employees with offers of
15 better working conditions and benefits.

Welfare

Two images from America's past reflect how health and welfare concerns are viewed in the United
States. The first image is that of the self-re- liant frontiersman. Armed with only an axe, a 20 rifle, a
Bible, and a strong will (and sometimes a bottle of whiskey against "snakebite"), he goes out into the
wilderness alone and survives. He asks no man for help (“God helps them that help themselves").
The second historical image is that 25 of the pioneer community, the groups that circled their
wagons for protection, shared their food, and helped each other when things got rough.

They came together to build each other's houses. They had great barn-raising parties in which
everyone took part. All together helped to build 30 the community school, hire the teacher, find the
doctor, fight the fire and pay the sheriff. When a neighbour needed help, the help was there ("A
friend in need is a friend indeed").

There is some historical truth in both images. 35 Obviously many millions did make it in America with
more than a little help from their friends. Others had enough ingenuity, pluck and luck to make it on
their own. The famous rags-to-riches and poverty-to-power stories had and have real- 40 life
parallels. But there are also the many who didn't succeed in America. There were those who,
working long hours in factories or "sweatshops," were too tired to educate themselves when the day
was done. There were also those who couldn't 45 move to where the grass was greener because
they were kept where the cotton grew.

Social welfare in the United States has always been torn between the concepts of the independent,
self-reliant individual and the interdependent, caring community. Generous to other nations,
Americans have been much less charitable at home. They have often appeared to be more
compassionate towards victims of earthquakes, drought and famine than towards people in need 55
in their own land. There seems to be some truth in the observation that Americans very often are
too proud to ask for help and welfare. Education and

A barn-raising party in 1888. In the picture on the right, taken almost a hundred years later,
neighbours help to build a home for a North Carolina widow and her two children. technical skills
have long since replaced the axe and the hunting rifle. But some Americans still feel that people who
can't find some kind of work somewhere deserve in part what they get or don't 5 get.

The welfare situation improved greatly through the social welfare legislation of Franklin D. Roosevelt
in the mid-1930s. Today, of course, there are many federal, state and local programs 10 that help the
unemployed, shelter and feed the homeless, and care for the sick. Local community institutions,
churches, charitable groups, and voluntary service organizations also play a large part. There is no
single welfare system, but rather a 15 mosaic of measures created to help those in need.

If someone loses his or her job, for example, there may be a number of benefits he/she is entitled to,
ranging from full pay up to a certain period, reduced percentages thereafter, state un- 20
employment compensation, eligibility for retraining, pension plan, and payments from a company-
sponsored or private unemployment Insu contract with the management. In case of long ance.
Health costs may also be covered by union term unemployment, federal funds can be claimed.

The federal government sets nationwide standards for the minimum hourly wage level, or the official
poverty level (see Chapter II). It finances and organizes national programs such as Social Security, Aid
to Families with Dependent Children (AFDC), the Food Stamps program, Unemployment Insurance
and Workmen's Compensation, Supplemental Security Income, Medicare, and Medicaid. These
different programs help alleviate financial problems for the elderly and/ or those who cannot work or
afford proper nutrition and health care. In 1986, over $450 billion was spent by the federal
government on social welfare.

Although programs and amounts of support vary greatly among the states and depend on the
individual social and economic situation of the recipient, the following figures give some rough idea
of the nature of these payments. For example, the average AFDC payment per family (more than 11
million individuals) in 1984 was $320 a month. The average monthly payment to Social Security
Retirement recipients (some 30 million individuals in 1984) was $417 per month. Nearly 4 million
disabled workers received $400 a month under the Social Security Disability Insurance program.
Some 2 million unemployed workers received $480 a month for 26 weeks (with an additional
thirteen weeks during recessions). The medical costs for some 20 million individuals were covered by
Medicaid in 1984. And more than 20 million people received food stamps with an average value of
$46 a month. These figures, of course, are only averages and give only a very general impression of
the nature and extent of state and federal programs and payments to those in need.

There are, however, astonishing differences in the degree to which states provide welfare support for
their citizens. Counting state and local funds only, the state of New York spends about $385 a year for
each one of its citizens on its poor, while Arizona only spends $68, and Florida $78 per capita of their
populations. Obviously if one is poor or sick, it is better to be in New York than

in Arizona. Likewise, although the states should be spending an equal amount of money when given
federal funds (federal grants often require matching funds from states and local communities), each
state's welfare department as- sesses its own citizens' needs. As a result, in the AFDC program,
designed to benefit children being raised in single-parent families, Alaska provides over six times as
much assistance (in 1986, an average of $730 per month to a parent with two children) as does
Alabama (only $118 per family). Some states provide a lot of help, and others, giving very little, seem
to hope that their poor will go elsewhere.

Since the 1970s, a number of states have started so-called "workfare" (work+ welfare) programs
which require welfare recipients to work or to participate in job training programs. In about half of
the states, programs are in effect which try to place welfare recipients in public-service jobs. Families
with preschool children are exempted from work requirements. By providing remedial education,
vocational training, and child care, state governments want to encourage welfare recipients,
especially families receiving AFDC, to get jobs with decent wages and prospects for long-term
employment. Some of the states' work- fare programs have met with good success. In
Massachusetts, for example, 20,000 welfare recipients were placed in jobs within two years.
California's new welfare-reform law provides for up to two years of training for unfilled jobs to
welfare recipients, and free child care. Other states have started similar efforts to help people get off
welfare and into permanent jobs.
By law, health care is available to those without any money or insurance. States, counties, and cities
all run or support hospitals, mental institutions, retirement homes and shelters for the homeless.
Again, the quality of care varies with the state, county, and community. Some spend a great deal,
others the bare minimum. Universities and similar institutions also often support and staff free
health and dental clinics. Most large universities sponsor free legal aid clinics that provide legal
assistance and advice for a token fee.

What makes the U.S. different from many other countries is the degree to which payments for
health, retirement, and even housing come from private sources. Workers in industry and white-
collar employees expect health insurance agreements for them and their families, benefits, and
pensions as part of their contracts. Companies and employers often pay a large part of these
benefits. Many unions offer unemployment benefits to their members, supplementing govern-
mental sources. Some unions also have their own retirement plans and several even own and man-
age retirement communities. When employees strike, therefore, they often ask for "fringe" benefits,
better retirement payments, better or fuller medical care, and so on. Similarly, when an individual is
considering working for a business or even a city or state government, or changing jobs, some of the
most important considerations are, for example, retirement benefits, family health and dental plans,
or life insurance. In many cases the benefits Americans receive from such sources exceed those from
the governmental programs available to everybody.

Still, there are many individuals who have never worked, or have never been able to, or who have
remained unemployed for long periods. These people are forced to rely on the basic governmental
programs and no one who has to do so can live comfortably. Yet, the two images remain, and those
who have made it sometimes find it difficult to understand or remember the problems of those who
haven't. It is not a lack of awareness, usually; rather, it has something to do with distance and size.
New York City's run-down tenements and the "white trash" of Appalachia, for example, are a world
away from the sunny beaches of Southern California. It's a bit like trying to convince someone who
leads a pleasant life on the Côte d'Azur that the sores of Glasgow and the poverty of Greece are his,
too, because "we're all in this together." Many hundreds of thousands of volunteers and charitable
organizations in the United States are doing their best to 90 help those in need. Most Americans
would agree, however, that a great deal more needs to be done.