The 2007-2009 Economic Crisis and Weakening of the Function of Welfare State in the United States of America

By beginning of the financial crisis in the U.S economy, many analysts, in their survey to find the roots and causes, point to different aspects such as state intervention or the lack of its timely presence in economic sphere. The first and most critical impact of such depression on domestic area was the fall of financial indexes and reduced public welfare. Focusing on the US depression in the scope of its internal structures, this article argues that it has led to the weakening of the welfare state in the U.S, due to the gap and income deficit and inability of the state in performing its welfare function for the vulnerable classes, resulted from the adoption of some strategies such as tax collection from financial institutes and classes and allocation of supportive financial resources to companies and institutes, along with the intensification of military presence in different regions of the world. To explain our argument, this article first articulate its theoretical framework consisting of imbedded liberalism and neo-liberalism theories in order to better understand the U.S economic dynamics and developments, then in the second section we refer to the roots, causes and also results of the crisis, and finally we investigate its impact on weakening of the U.S welfare state function.