Most political regimes in the Middle East and North Africa are non-democratic, but the lived reality of authoritarian rule differs widely across countries. This difference is particularly apparent when it comes to social policies. While resource-abundant, labour-scarce regimes in the Arab Gulf have all established generous welfare regimes, the picture among labour-abundant regimes in the region – that is, in countries with a large population relative to their natural resource endowment – is one of divergence. For example, in the late 2000s the percentage of people with health insurance was between 75 and 90 per cent in Iran, Tunisia, and Algeria, compared to 55 percent in Egypt and 20-30 percent in Morocco and Syria. High levels of coverage are associated with significantly faster improvements of life expectancy over the past four decades. The situation is similar in the realm of education where enrolment expanded nearly twice as fast in Tunisia and Iran (and 50 per cent faster in Algeria) compared to other labour-abundant countries in the region. As examples abound, the key question is why some authoritarian regimes have provided welfare broadly and generously to their citizens and others have not.
The divergence of welfare regimes started very early, coinciding with the formation of authoritarian regimes in the 1950s and 60s – and the late 1970s in the case of Iran. Secondly, welfare regimes have been very path dependent and, despite important changes to economies in the Middle East and North Africa with the advent of neoliberal reforms, episodes of systemic and sustained welfare retrenchment have been mostly absent as spending patterns reverted back to their long-term trend. This, in turn, points to the long-lasting effect of authoritarian support coalitions which underlie different welfare regimes.
Broad coalitions span large cross-sections of the populations, including working and lower middle classes. They emerge when major conflicts between elites at the moment of regime formation cannot be reconciled or repressed. Different elite groups have incentives to broaden their coalitions to outcompete on another. Social policies catering to lower income groups in society thereby become the ‘cement’ which keeps these broader coalitions together. Salient communal cleavages – for example, between different ethnic or religious groups in society – can derail this process as they give elites incentives to build coalitions that rely more on outside groups. As a result, coalitions become narrow. Coalitions are also narrow if elites remain cohesive and therefore see no need to share the spoils on a large scale with the population at large.
But incentives are not everything. In a geopolitical challenging environment, such as the Middle East, regimes have often faced the need not only to secure their rule against threats from the inside, but also those coming from the outside. Such external threats – take, for example, the Arab-Israeli conflict – put acute pressure on social spending, which only resource-abundant regimes can avoid.
There are three distinct pathways of welfare provision: authoritarian welfare states, such as Tunisia or post-1979, had both the incentive and ability to provide welfare; broad welfare provision in the form of widely accessibly but generally underfunded social policies are characteristic of regimes such as Egypt that struggled to square the circle between strong incentives but very limited ability to provide social welfare as a result of acute external threats; and minimal-segmented provision which either does not give social policies much attention (such as Morocco until the late 2010s) or builds relatively generous welfare regimes yet with high barriers to access. Such segmented welfare regimes are particularly frequent in regimes with salient communal cleavages, such as Jordan where the state has historically favoured the East Bank population at the expense of the Palestinian population.
Tunisia and Egypt are examples of two different welfare regimes. The Egyptian case is theoretically particularly intriguing as it sheds light on the mechanisms through which regimes sought to mitigate the dilemma between “butter and guns”. The key notion here is cheap social policies which have allowed the Egyptian state since the 1950s not only to dole out popular, yet cost-effective social policies, but also – paradoxically – to use social policies as means to generate funds. The establishment of the country’s social security system in the 1950s was conceived from the beginning as a “powerful source of money that the government can rely on.” Related to that it’s clear that legal extensions of social security coverage – such as the inclusion of agricultural workers or students – systematically coincide with major shortages of foreign currency reserves in Egypt. This makes sense if we see social security contributions as a form of forced saving to curb domestic consumption.
Understanding the political economy underpinning welfare provision in the Middle East not only allow us to make better sense of different levels of welfare provision in the region, it also challenges widespread narratives about a region-wide, universal roll-back of welfare states with the advent of neoliberal reforms. These changes show that the extent of welfare retrenchment was itself a function of the way in which welfare regimes had been created in the first place. Finally, we should be sceptical about the oft-assumed link between social policies and regime stability. As social policies can engender and empower new societal groups as well as spawn widespread expectations about social mobility, they can have unintended consequences for authoritarian regime stability in the long run.bh