Cathie Jo Martin

Does the Organization of Capital Matter? Employers and Active Labor Market Policy at the National and Firm Levels

Does the organization of business matter for social policy development in the advanced capitalist democracies? Conventional welfare state analysis has given this significant question scant attention. We argue, however, that the representational power of business, coordination across business interest units, and integration of associations in corporatist policy-making forums, or what we call the social corporatist organization of business, should result in greater support and participation by employers in social policy formation and implementation. We test our arguments with models both of 1980–98 pooled time-series data on within- and across-country variation in spending on active labor market programs and of extensive firm-level survey data from Denmark and the United Kingdom. We find that the centralization and coordination of employers as well as the integration of employer organizations in corporatist policy-making forums are strongly associated with shares of national income devoted to active labor market policy. We find, moreover, that the degree of employer organization conditions active labor market policy responses to “de-industrialization” and increases in general unemployment. At the firm level, membership in an employer association has a significant positive effect on employer participation in active labor market programs in corporatist Denmark but not in the pluralist United Kingdom.

The State and Coordinated Capitalism: Contributions of the Public Sector to Social Solidarity in Postindustrial Societies

This article investigates the politics of change in coordinated market econo\mies, and explores why some countries (well known for their highly cooperative arrangements) manage to sustain coordination when adjusting to economic transformation, while others fail. the authors argue that the broad category of “coordinated market economies” subsumes different types of cooperative engagement: macrocorporatist forms of coordination are characterized by national-level institutions for fostering cooperation and feature a strong role for the state, while forms of coordination associated with enterprise cooperation more typically occur at the level of sector or regional institutions and are often privately controlled. although these diverse forms of coordination once appeared quite similar and functioned as structural equivalents, they now have radically different capacities for self-adjustment.The role of the state is at the heart of the divergence among european coordinated countries. a large public sector affects the political dynamics behind collective outcomes, through its impact both on the state’s construction of its own policy interests and on private actors’ goals. although a large public sector has typically been written off as an inevitable drag on the economy, it can provide state actors with a crucial political tool for shoring up coordination in a postindustrial economy. the authors use the cases of denmark and germany to illustrate how uncontroversially coordinated market economies have evolved along two sharply divergent paths in the past two decades and to reflect on broader questions of stability and change in coordinated market economies. the two countries diverge most acutely with respect to the balance of power between state and society; indeed, the danish state—far from being a constraint on adjustment (a central truism in neoliberal thought)—plays the role of facilitator in economic adjustment, policy change, and continued coordination.

Business and the New Economic Activism: The Growth of Corporate Lobbies in the Sixties

There is wide agreement that the 1970s witnessed not only an increase in the level of political activity by business but the development of several new types of activity through trade associations, grass roots campaigns, and ad hoc coalitions across industrial sectors. This article contends that while the level of political activity by business did increase, the forms it look were all developed during the 1960s. The author argues that the forms were inspired by Kennedy and Johnson Administration efforts to encourage and to help organize business activism in order to gain greater support for their policies vis-à-vis Congress.

Together Again: Business, Government, and the Quest for Cost Control

Corporate America leads the pack in the collective anxiety attack over health care costs. But will the business community add its considerable political power to the movement for national health reform? Conventional wisdom suggests not: businessmen seldom rally for collective concerns, have traditionally been biased against government action, and have diverse interests. This article guardedly offers grounds for greater optimism about corporate participation, arguing that the proper institutional context can help businessmen to see their preferences as consistent with health reform. Business groups have already proven critical to the issue development stage, where a dedicated group of corporate health reformists were key to getting reform on the national agenda. Business may also respond to strong leadership from President Clinton and assist in the legislation of national health reform. Yet the price of this corporate support is a decidedly conservative slant to the proposed legislation.

Business Influence and State Power: The Case of U.S. Corporate Tax Policy:

The question of state autonomy is central to recent writings in political science. One reason the autonomy debate has not been definitively resolved is that the real world presents empirical evidence to confirm both sides. Statecentered explanations find autonomous state action in a variety of policy spheres. Society-centered explanations counter with observations of the rise of interest groups on the U.S. political scene. No area illustrates these contradictory trends more vividly than corporate taxation. At times corporate taxation seems the quintessence of pork-barrel politics; at other times business interests have much less input into the policy process. The Economic Recovery Tax Act of 1981 was widely perceived as a business orgy in which private interests feasted on the revenue base of the state. By comparison, the Tax Reform Act of 1986, while certainly beneficial to the upper-income population, was initiated by state actors and had limited business support until the final stages.

Sectional Parties, Divided Business

The National Association of Manufacturers (NAM) led the corporate attack on labor organization and government regulation in the early twentieth century. Yet NAMs deep distrust of coordination, in fact, developed years into its organizational life: at its inception, NAM organizers sought mechanisms to coordinate economic and political business activity, and held policy positions that resembled those favored by contemporaneous European manufacturers. Thus, the organizations dramatic shift in policy preferences almost a decade later was something of a sea change: suddenly NAM became committed to laissez-faire liberalism—the antithesis of coordination—and became best-known for its commitment to fighting organized labor.

Beyond Bone Structure: Historical Institutionalism and the Style of Economic Growth

Explaining economic growth is a bit like trying to account for beauty. Beyond the obvious ‘chacun a son gout’ is a debate about what really matters. While neoclassical economists (and their esthetic equivalents) might argue that bone structure is everything, historical institutionalists might insist that growth (like beauty) reflects a certain sense of style. Indeed, institutionalists bring into the growth equation all sorts of factors neglected by their economistic colleagues: not least institutionally determined relations between employers and workers, patterns of cooperation among firms, systems of financing, and the opportunities or constraints created by the structures and policies of government. They do that because the succinct explanation for cross-national differences in growth rates, provided by historical institutional analyses, is that institutional divergence produces variations in economic performance. Institutions create incentives for firms to undertake certain types of strategies for economic production. The emerging differences in production processes lead to divergent policy outcomes. Although, in an ideal world, countries might be expected to converge on the best model, in practice institutional systems become entrenched. Because each model has its own sets of benefits and detriments, and of winners and losers, institutional configurations and path dependencies are difficult to alter.

Markets, Medicare, and Making Do: Business Strategies After National Health Care Reform

This essay examines the role of business health care purchasers in keeping market solutions at the center of the health system. One might assume that employers would have a clear ideological preference for market solutions, but big business managers are ambivalent about market interventions at both the firm and public policy levels. Although currently enthusiastic about market-oriented managed care, large employers have been periodically disappointed by firm-level market experiments during the past two decades. They viewed with skepticism the Republican proposal to apply private-sector market cures to the public Medicare and Medicaid, fearing that the proposals would accelerate cost-shifting to private business payers. Big business objections have been muted, however, by the organizational weakness so vividly illustrated during the national health reform debate.

Mandating Social Change: The Business Struggle Over National Health Reform

This article explores the conditions under which business managers endorse human resource investment policy drawing from the recent national health reform episode. In order to generate corporate support, a business community must develop corporate policy capacity, or the ability to grasp complicated social issues and to act in support of this social agenda. Corporate support is also influenced by the business–related strategies of government leaders who can encourage businesses to organize around legislative issues. The bid for national health reform met neither condition. Corporate policy capacity was inadequate to sustaining business support for health reform at the point of translating general corporate anxiety into specific legislation. Because U.S. business groups are weak, fragmented, and compete for members, they tend to cater to strong, vocal minorities and are often unable to act on majority positions. In health reform although a majority of business groups’ members wanted reform, minority objections prevailed. In addition, where the Clinton administration’s business mobilization efforts were complicated by its campaign for mass support, the Republicans organized a formidable corporate lobby against the bill.

Business and the Politics of Human Capital Investment Policy: A New Institutionalist Perspective

Despite the conventional wisdom that managers generally oppose social policy, business opinion polls revealed considerable support for the health and training initiatives of the first Clinton administration. Yet while managers acting collectively in groups made tangible, public expressions of support for the training initiatives proposed by Clinton, they ultimately rejected the presidents national health plan. This paper attributes the differential responses by business, in part, to variations in the networks organizing employers in the two spheres. Differences in policy-level business organization, private policy expertise and policy legacies mattered enormously to how managers thought about the proposed government initiatives and how they participated in the legislative process.