Post-Fordism and the State

Bob Jessop

Department of Sociology
Lancaster University
Lancaster, LA1 4YL, UK

Referaat aines kohaliku ja regionaalse arengu planeerimine
Koostanud: Sonja Palhus
The moment when Fordism changes to post-Fordism involves many complex changes in the society. First argument is that the Keynesian welfare state changes to a Schumpetrian workfare state, as Fordism changes to post-Fordism. The second argument is that the nation state will be reorganized on supranational, national, regional and translocal levels.


Karl Polanyi; Luhmann; regulation approach; autopoiesis; social embeddedness; complexity; governance; meta-governance; steering; collibration; negotiated economy; capitalist societalization;



Both Fordism and post-Fordism are interpreted in various ways.

The Nature of Fordism

Fordism involves mass production of consumer durables which are made on moving assembly line techniques operated with the semi-skilled labour of the mass worker. The steady growth of macroeconomics in relatively closed economies is a second feature of Fordism. Also typical in Fordism is the separation of ownership and control in large corporations, the monopoly pricing, union recognition and the state involvement in managing the conflicts between capital and labour.

Fourth way to see Fordism is as a general pattern of social organization. This means the consumption of mass commodities in nuclear family households. This means that Fordist society is an urban-industrial, ”middle mass”, wage-earning society.

The Keynesian Welfare State

The dynamics of Fordism is closely related to the form and function of the Keynesian welfare state, which in turn has important implications for the dynamic of Fordism. In Fordism the state manages the wage relation and labour market policies and guides the aggregate demand, in this way it helps to balance the supply and demand. Moreover by holding out the promise of smoothing economic fluctuations and securing stable growth, the state also permitted Fordist firms to secure increasing returns to scale.

Second, the state invested in infrasructure and encouraged fordist mass consumption through housing and transport policies. Also the dominance of fordist mode of growth enabled the state to link the interests of organized capital and labour in a programme of full employment and social welfare. Many of the welfare policies in 1960s and 1970s were encouraged by the growth of Fordist system, with its commodification, urbanization and bureaucratism. Full employment is often considered to be the main goal of Keynesian welfare state, and both the Fordism and the post-war boom helped in achieving that.


To justufy the nameing of ”Post-Fordism” there has to be implications that Post-Fordism has demonstrably emerged form tendencies originating within Fordism, but still has marks of cruicial break with it.

Key Features of Post-Fordism

As a labour process post-Fordism can be defined as a flexible production pricess based on flexible systems and an appropriately flexible workforce. Its cruicial machinery is microelectronics-based information and communications technologies. Post-Fordism is based on the dominance of a flexible and permanently innovative pattern of accumulation. It is based on flexible production, rising incomes for polyvalent skilled workers and the service class and increased profits based on technological and other innovations. Also post-fordist accumulation will be more oriented to world wide demand, not so much on demand within a state. Post-Fordism is more demand than supply-driven. Competition will turn on non-price factors such as improved quality and performance for individual products and responsiveness to customers. The money form will be dominated by private, rootless bank credit which circulates internationally.

Forces behind the transition to a Post-Fordist state

There are three main driving forces behind the emergence of Post-Fordism They are the rising of new technologies, internationalization and the paradigm shift from Fordism to post-Fordism.

The competition with the newly industrialized countries (NICs) have forced the advanced capitalist economies to specialize in the new core technologies. In this the state has importance in promoting the technical development so that as many firms as possible can benefit from it. Also state must shift industrial support away from declaning sectors to new sectors.

The internationalization puts weight on the wages as costs of production rather than the sources of home demand. That is why all countries have to become more involved in managing the process of internationalization. They have to secure the maximum benefit to its home-based transnational firms and banks.

The new paradigm of post-fordism means that the primary econmic functions of states are redefined. States are focused on the supply-side problem of international competitivenes and attempt to subordinate welfare policy to the demands of flexibility.


The post-Fordist state emerged due to the crisis in Fordism. This didn«t happen at once and often it typically involved intensifying the features of the Fordist state. When this didn`t help, economic and political forces started to look for a new state form that would be able to solve the crises of Fordist accumulation and restabilize the state system. B. Jessop argues that what is gradually emerging from the search process is a structural transformation and fundamental strategic reorientation of the capitalist state.

The Schumpeterian workfare state

Compared to Keynesian welfare state the Schumpeterian workfare state is ready to cut back the domestic full employment in favour of international competitiveness and the productivist reordering of social policy becomes before the redistributive welfare rights.

The current shifts in the world economy seem to require just such transformation of the state. Like in Keynesian wellfare state there can be expected to be variations in Schumpeterian workfare state.

The ”hollowing out” of the national state

Though the political power still remains within state, its capacity to project its power is weakened. This is due to the intenationalization and due to the risks emerging from the gobal environment. Some state capacities are transferred to pan-regional, plurinational, or international bodies with a widening range of powers. Some powers are moved to restructured local or regional levels of governance in the national state and some are taken over by emerging horizontal networks of power – local and regional – which by-pass central states and connect regions in several nations.

Why the ”hollowed out” Schumpeterian workfare state might be seen as Post-Fordist

The Schumpeterian workfare state could be seen as post-Fordist cause it helps to resolve crisis tendencies within the Fordist state. Here its key mission is to bring supply-side intervention closer in local or regional innovation systems, as well as to develop new state organizations which are better adapted to the emerging international economic order. It also restructures social welfare and subordinates it to market forces.

Also the Schumpeterian workfare state could be seen as post-Fordist because it helps to strenghten the dynamic of a post-Fordist accumulation regime. In this regard three factors could be mentioned. Its orientation to innovations takes account the consequences of new technologies; it takes account the terms and conditions of international competition and thirdly its restructuring of social reproduction towards flexibility signifies its awareness of the post-Fordist paradigm shift as well as the impact of internationalization on the primary functions of money and wages.

The ”hollowing out” can be seen as a response to the various ”state failures” which accompany the crisis in Fordist regime, and its social mode of regulation. The ”hollowing out” tends to relocate important legitimacy functions to levels of political organization which are able to cope better with the symptoms of Fordist crisis. This is particulary important in questions which are either too small or large in scale for the national state to handle effectively.


There are many forms of Schumpeterian workfare state. This is obvious cause –not like in Atlantic Fordism- it is associated with struggle of power between many capitalist modes.

Alternative Schumpeterian workfare state strategies

Neo-liberalism is concerned to promote market-guided transition towards the new economic system (e.g. Reaganism in the USA). The public sector is faced with a mixture of privatization and liberalization. For the private sector it means deregulation and new legal and political frameword which provides support for market solutions. Neo-liberalism means the reorientation of state activities to the need of private sector. It welcomes internationalization. Once the transition to neo-liberalism is completed it will also mean the reinforceing if monopolistic regulation and continuing state intervention.

Neo-corporatism relies on the concentration of the economic decisions and activities of private economic agent oriented to their own econimic interests. Neo-corporatist system must reflect the interests in policy communities and the heterogenity of the labour force and labour markets. It will be directly and explicitly oriented to innovation and structural competitiveness. Neo-corporatism reflects the more flexible forms of the post-Fordist economy and the centre of corporatist gravity will shift to the microlevel away from macroeconomic concentration. The state is more on the background of the corporatist negotiations than playing an active role in them.

Neo-statism promotes state-guided approach to economic reorganization. It is a mixture of state-sopnsored flexibility and state activities concerned to secure the efficiency of an industuial core. On neo-statism the state sets strategic targets for flexible accumulation and its stuctural policy promotes the overall competitiveness of the national economy. It also favors flexi-skill rather than flexi-price labour. The state it self must become flexible because of the openness of post-Fordist economies and the rapid changes involved in flexible accumulation.

Mixed Schumpeterian workfare state strategies

All of these strategies can be combined within and across different levels of political organization. For example in the European Union we can find features of them all. Also different strategies are found inside each European state.


The Fordist state has not only been undergoing a reorientation towards Scumpeterian workfare functions, but it has also been subject to a stuctural transformation. This means reordering of the relations among state organizations and also the reordering of relations among different levels of political organizations.

The growth of supranational regimes

The role of supranational bodies are expanding. They increase in number, in territorial scope and also the amount of important tasks they performe is growing. Especially has grown their functions concerning the competitivenes of the area they manage. In paricular the impact of supranational regimes can be seen on the three growth poles on an emerging ”triadic” world economy i.e. The Asian Pasific region, the emerging European Economic Space and North America. There is a greater degree of cross-national investment and trade within these regions than there is between them.

The resurgence of regional and local governance

Together with the rise of international state apparatures also the role of strong regional and local states is increasing. During the Fordist era, local states operated as extensions of the central Keynesian welfare state and regional policy was primarily oriented to the location of industry in interest to spread full employment. Today local state«s job is to make local and regional economies competitive in the new world economy. Local states have growing interest in issues like regional labour market policies, education and training, and innovation centres. Also new kinds of local partnerships are emergeing to promote the development of local resources. More pessimistic scenarios claim that polarzation will grow within localities (for exemple urban underclass occupying inner-city ghettoes) as well as regional inequalities will increase.

Because of this shift to local level, the variety of forms and strategies of state intervention is increasing. This is related to local supply-side conditions, which are best dealt with close to the ground, but it is important that central government coordinates and supports these actions. This is especially important when economic initiatives involves - in addition to government – business associations and private bodies.

There is renewed interest in the promotion of subnational regional and local economies at the expanse of concern with the national economy. Since the supply-side conditions making for structural competitivenes vary among firms and sectors, it is important that these be identyfied at the appropriate level and implemented locally. On the other hand, cause national state losses its power to international stage and cannot any more guarantee full employment and growth on national scale, the political pressure gathers more and more on the regional level.

An emerging trend towards translocal linkages

Links between local states are growing. In Europe this means both links with EU institutions and with direct links among local and regional authorities in memeber states. Similar trend is visible in North America (with Canada and Mexico) and in Japan (with other East Asian parts).

Is there still role for the national state?

Despite the ”hollowing out” of the national state, it still remains the most significant site of struggle among competing global, triadic, supranational and regional forces. The national state keeps crucial political functions despite the transfer of some activities to other levels of political organization. Especially it has a continuing role in managing the political linkages across different territorial scales and is expected to do so in the interests of its citizens. Globalization and transnational regionalization tendencies has provoked counter-tendencies and people are looking for regional and national identity.

The national state is still placed to deal with social conflicts and redistributive policies. So the national state has a dilemma: on the one hand, it must become actively involved in managing the process of intrnationalization, on the other hand, it is the only political instance which has chance of preventing a growing separation between gobal market dynamics and the conditions for insitutional integration and social cohesion. So the central political role of a state remains, but this role is redefined. It will remain a key political factor as the highest instance of democratic political accountability.


If the wage form continues to be the dominant social relation in capitalism, then there will still be a role for the welfare state. The question then will be how the state should be restructured and within what limits its role can be reduced (from a neo-liberal viewpoint) or expanded (from a neo-statist or neo-corporatist viewpoint), so that the sructural competitivenes would not be harmed or the transition to post-Fordism would not be slowed down.

Though we are still living through phase of transition, one general conclusion is justified: the Keynesian welfare state will be replaced with Schumpeterian workfare state. It will continue to exercise a crucial role in the social reproduction of wage labour, but this role will be linked to the economic issues where state is confronted with open economies.

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