Anglo-Saxon economies and societies: a comparative approach

French commentators often speak of the Anglo-Saxon model'', as if Britain and the United States formed a single economic system opposed to a French'' or Rhineland'' one. The expression is useful but misleading. The two countries do share a family resemblance: flexible labour markets, powerful financial centres, a smaller tax burden than in continental Europe, and a political culture suspicious of state intervention. But Britain has a universal public health service and America does not; British trade unions are twice as strong; and the two countries have taken opposite paths on climate policy since 2025.

This chapter compares the two economies and societies with recent data, always quoted with source and year. Its second aim is methodological: to teach you to use a statistic in an essay without making it say what it does not say.

13.1 Liberal capitalism: a family of ideas

The intellectual tradition of economic liberalism is largely British. Adam Smith argued that the pursuit of private interest, channelled by competition, serves the common good better than benevolence or state direction.

After 1945, both countries built mixed economies in which the state managed demand, in the spirit of John Maynard Keynes, and protected workers against the main risks of life. The crisis of the 1970s (inflation, unemployment, strikes) opened the way to a liberal turn: Margaret Thatcher in Britain from 1979 and Ronald Reagan in America from 1981 cut taxes on high incomes, privatised (in Britain) or deregulated (in both countries), and confronted the trade unions. Their legacy defined what the rest of the world calls the ``Anglo-Saxon model''.

13.2 Two welfare states

The Danish sociologist Gøsta Esping-Andersen classified the welfare states of rich countries into three ``worlds'' (1990): liberal, conservative-corporatist and social-democratic. Both the UK and the US fall into the liberal family, where benefits are modest and often means-tested. But the comparison stops there.

Britain built its welfare state after the Beveridge Report of 1942, around a universal principle: the National Health Service, created in 1948, is financed by taxes and free at the point of use for all residents. Pensions and unemployment benefits, on the other hand, are flat-rate and low compared with France.

The United States built a fragmented system in two waves: the New Deal (Social Security, the federal pension system, in 1935) and the Great Society (Medicare for the over-65s and Medicaid for the poorest, in 1965). Most working-age Americans depend on their employer for health insurance. The Affordable Care Act (2010) reduced the number of uninsured without creating a universal system; in 2024, 8.0 % of the population had no health insurance at any point in the year (Census Bureau).

From welfare to work. Since the 1990s, both countries have tied assistance more closely to work. In America, the welfare reform of 1996 limited cash assistance in time and made it conditional on work; the Earned Income Tax Credit, a tax credit for low-paid workers, became the main anti-poverty tool for working families. In Britain, Universal Credit, introduced from 2013, merged six working-age benefits into a single monthly payment that tapers off as earnings rise. The underlying philosophy, often called workfare, is shared: work is presented as the best route out of poverty. Its critics reply that it ignores in-work poverty, and that the conditions attached to benefits can be punitive.