- In the United States, these rates were only 25 percent in 1973,
and down to 18 percent by 1985.^36
These industrial relations orientations had macro-economic conse-
quences. In countries where trade unions were strong and where the
government remained committed to full employment, workers agreed
to moderate their wage demands, so as to prevent inflation and avoid
the use of restrictive policies that would have destroyed jobs. When
unions were weak and confronted with recurrent recessions, on the
other hand, organized labor used every occasion to push for imme-
diate wage gains. This explains why countries governed by the left
succeeded in consistently combining high employment levels with
price stability, while those where the right prevailed ended up failing
on both counts.^37
Overall, the politics of the postwar years proved relatively favorable
to planning and state intervention, to public investments and macro-
economic management, and to trade unions and collective bargaining.
The era of unbridledlaissez-fairewas over. The exact composition of
the mixed economy nevertheless remained very much an object of
contention between the left and the right. In the beginning, planning
and nationalizations appeared most controversial. Soon, however, the
debate shifted to the politics of macro-economic management and
collective bargaining. Differences over these questions were serious
and consequential. Debates often remained muted, though, because
the issues involved often appeared technical or specialized. This was
not so with another project that largely defined the era: the develop-
ment of the welfare state.
The welfare state
In the beginning of the 1950s, hardly any country spent more than
10 percent of its gross domestic product on social welfare programs.
Thirty years later, the average welfare effort of OECD countries had
(^36) Bruce Western,Between Class and Market: Postwar Unionization in the
37 Capitalist Democracies, Princeton University Press, 1997, pp. 17 and 24.
David R. Cameron, “Social Democracy, Corporatism, Labour Quiescence and
the Representation of Economic Interest in Advanced Capitalist Society,” in
John H. Goldthorpe (ed.),Order and Conflict in Contemporary Capitalism:
Studies in the Political Economy of Western European Nations, Oxford
University Press, 1984, pp. 143–78.
The age of universality (1945–1980) 117