Despite its rapid expansion over the last decade, the American welfare state appears unable to remedy many of the social problems it has been designated to solve. In many instances, the welfare state has become as much a part of the problem as the solution. Unfortunately, most proposals to reform the welfare state do not go beyond the liberalconservative conception of the welfare state as a backup to the capitalist market system. This conception of the welfare state is part of a larger comitment to a free market-pluralist ideology that singles out certain social phenomena as problematic and limits the range of interventions considered acceptable. Thus, the welfare state's ideological commitments create a built-in tendency to maintain the status quo.

Political economy is presented here as a particular analytic perspective that challenges the values and assumptions of the free market-pluralist ideology and thus offers a critique of the American welfare state that cannot be formulated within the free market-pluralist conception of reality.