Variations of the putative `crisis' of the welfare state have been with us since the 1970s, pointing at fiscal, legitimacy and governance aspects. As is argued here, crisis perspectives have typically been overblown; at least if by `crisis' is meant breakdown or fundamental change of a system. One might even argue that the marriage between nation state and welfare state has never been stronger than today. Divorce is hardly in question, but perhaps a reasonable long term perspective might be that the relationship between nation state and welfare state has moved from loose co-habitation through consolidated marriage towards a future of legally regulated co-habitation. We do not necessarily have to cry `crisis' every time social or welfare reforms are made: it would indeed be a strange capitalist conservative-liberal-social democratic society which did not experience continuous social reform activity.
The welfare states of Western Europe continued to grow during the 1980s and 90s in terms of expenditures and beneficiaries, partly because of established social rights and entitlements which automatically lead to increase in expenditure as the composition of the population changed – but also due to political will and broadening definitions of welfare state tasks. Empirical research shows that almost everywhere in Europe successful attempts to reduce benefit levels have taken place, yet there are few signs of radical or fundamental change. In spite of similar challenges and assumed unifying forces generated by European integration, great institutional variations between European welfare states persist. In this paper I shall discuss why we - on the basis of domestic and external and international factors can expect relatively less state welfare in Europe, especially in the richest countries, whatever their model of `social Europe', and why - in spite of this - we can expect a relatively comprehensive European welfare state to survive.