Welfare capitalism - Definition and Overview

Welfare capitalism was the response of the West to the abuses "regular" capitalism. In the 19th and early 20th centuries, the economies of the United States and many Western European countries grew exponentially. However, the established wealth for the few elite was marked by 18-hour workdays, no minimum wage, child labor, and dangerous conditions for the lower class. The response to these problems by the West was not Communism, as Karl Marx predicted, but welfare capitalism. Government stepped in to temper capitalism as workers gained political pressure. In the 1930s and 1940s, during the Great Depression, governments created "safety nets" for the citizens, like public welfare and unemployment insurance and established many regulations on all aspects of the economy. Anti-trust laws were enforced, laws outlawing child labor, minimum wage laws, and laws limiting the workday were put into place. Now, markets operate but are constricted to government regulations. The United States, as well as most of Europe (including Russia), run under welfare capitalism.

See Also: Capitalism, Socialism, Communism