ABSTRACT
This chapter looks at economists' circumstances in light of the past, hoping in this way to gain some perspective on what the future of the welfare state might portend. The historic record of welfare states during the last 100 years suggests three somewhat overlapping phases, each building on what had gone before. After a generation or more of expansion, the democratic welfare states had produced a policy system that was admirably attuned to—and presumed—continuous economic growth. In essence the new pessimism of the 1970s revived the view—so long out of favor—that there were inherent contradictions among the basic values surrounding the democratic welfare state. Perhaps more than anything else, it was this sense of common danger and vulnerability that made the security-equality-liberty aims of the new welfare state seem consistent and integral to the functioning of both society and the economy.
