Printed in the United Kingdom Does Labor Matter? Institutions, Labor Unions and Pension Reform

This article challenges Paul Pierson’s account on the (supposedly declining) role of labor unions in the ‘new politics of the welfare state’. More specifically, the text compares labor’s influence on the French and the American politics of pension reform since the 1980s. The analysis of recent reforms undertaken in both countries demonstrates the impact of institutions and managerial settings on labor’s political strategies. These institutional variables explain the fact that French unions have a much more direct influence on public pension reform than their American counterparts. In France, labor unions have an ideological ‘veto point ’ derived from their integration into the management process. Their strong influence on the ‘new politics of the welfare state ’ is undeniable: labor still matters. For more than a decade, students of public policy have attempted to understand the ‘new politics of the welfare state’. Among these scholars, Paul Pierson is by far the most cited. In an insightful article, he argues that politicians, in their efforts to cut social spendings, face strong opposition from new interest groups. According to Pierson, these groups are the mere product of the welfare state development itself. During the post-war era, new social programs – and the enlargement of existing schemes – created genuine social constituencies. ‘With these massive programs have come dense interest-group networks and strong popular attachments to particular policies, which present considerable obstacles to reform ’ (Pierson 1996: 146). Politicians are using ‘blame avoidance ’ strategies in order to overcome these obstacles and pursue their retrenchment agenda.