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“Workers’ Compensation, Federalism, and the Heavy Hand of History”*

Workers’ compensation1 was the first social insurance program to gain widespread acceptance in the United States, and as such became one of the foundations of the modern American welfare state. Most states passed workers’ compensation laws between 1911 and 1920, and all but two states did so by 1935. The other major social policy innovation of this era were mothers’ pensions laws, which were targeted at the poor children of single mothers. These laws also spread rapidly in the 1910s and were on the books in virtually every state by 1935. The major histories of the American welfare state (Katz 1986; Lubove 1986; Weir, Orloff, and Skocpol 1988; Berkowitz 1991; Berkowitz and McQuaid 1992; Skocpol 1992, 1995; Noble 1997; Trattner 1999) always acknowledge the importance of workers’ compensation and mothers’ pensions in the early 20th century, and some authors (Nelson 1990) go further by claiming that these two programs established the major faults lines of social provision – between social insurance and public assistance, between employed male workers and unpaid mothers – for the rest of the century.

And then, at some point in the 1930s, workers’ compensation just disappears from the literature. Gone. Starting with the Social Security Act of 1935, the major histories shift their focus to the national level. Mothers’ pensions have been transformed by the Social Security Act into Aid with Dependent Children, later Aid to Families with Dependent Children (AFDC). Faltering state-level efforts to aid the poor blind and poor elderly have been given financial help from the national government and been federalized. New forms of social insurance for the unemployed and the elderly have been introduced. The history of the American welfare state is now the history of programs created in 1935 and later expanded or cut back, with particular attention to Social Security and AFDC. It is also the history of programs created after 1935 that were extensions of Social Security (disability insurance, Medicare) or were linked to AFDC (Medicaid, Food Stamps). The history of workers’ compensation fits in neither category, for it was omitted from the Social Security Act and has remained the province of state governments ever since. Read any of the literature cited above and you will not find a single mention of workers’ compensation after the New Deal.

Of course, workers’ compensation did not end in the 1930s. The program continues to this day in providing income support and medical services to injured workers and their families. Workers’ compensation is currently one of the largest components of the American welfare state. Total spending topped $43 billion in 1995, which was more than Food Stamps, Supplemental Security Income, public housing, the Earned Income Tax Credit, or AFDC. Over 110 million workers were covered by workers’ compensation laws that same year, roughly the same number covered by unemployment insurance (U.S. Census Bureau 1999). Although it is truly odd that such a large and widely available


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