Ed Glaeser says differences in social services and the redistribution of income between Europe and the US can be explained by "America’s greater ethnic heterogeneity and more conservative political institutions":
Success of the left in Europe, the right in US, by Edward Glaeser, Commentary, Boston Globe: After spending a week in India, I was surprised to return to the news that true blue Massachusetts had acquired its first Republican senator since Edward Brooke. I should have been less shocked. . .. America remains remarkably conservative by world standards...
There are underlying factors that explain the differences between the United States and Europe. Five years ago, my colleague Alberto Alesina and I wrote a book ... which tried to understand why the United States devotes far less on social services and redistribution than nations in Western Europe. These differences can’t be explained by economic forces. Before taxes, incomes in the United States are more unequal and more volatile, which would seem to call for more, not less, redistribution. Some argue that America has less redistribution because disadvantaged Americans find it easier to climb out of poverty, but poor Americans are actually less likely than poor Europeans to move up the income ladder.
We concluded that the redistribution gap between the United States and Europe could best be explained by America’s greater ethnic heterogeneity and more conservative political institutions. Countries with more ethnic diversity generally spend less on social programs.
Before welfare reform, US states with more African-Americans were significantly less generous to their welfare recipients. My colleague Erzo Luttmer found that people in the United States who live around poor people of a different race are more likely to oppose welfare spending. There is a long historical literature, written by scholars like C. Vann Woodward, documenting the role that racial divisions have played in blunting the appeal of populist redistributors in the United States and elsewhere.
The other half of the difference between the United States and Europe can be explained by differences in political institutions. Richer countries - including the United States - that have have first-past-the-post electoral systems tend to have less redistribution. The welfare state is generally bigger in countries that make it easier for minority groups to elect leaders through proportional representation, as is the case in much of western Europe. ...
Over decades, the success of the left in Europe and the right in the United States has led to wildly different beliefs about the nature of poverty and success. We found that 60 percent of Americans thought that the poor were lazy, while only 26 percent of European share that view. Fifty four percent of Europeans think luck determines income; only 30 percent of Americans concur. These differences don’t reflect economic reality... They instead reflect the long-run ability of politics to shape public opinion. Institutions, like proportional representation, that empower the left do a good job of explaining which nations have opinions associated with the left, like the view that chance determines success.
A year ago, I wondered if the Obama victory signaled the declining significance of race and an American lurch to the left. But countries change slowly. ... By world standards, we are a conservative nation. Those who would change that fact need to dig in for a long fight.
Most of this is a rehash of things that have been covered before. What's new is the observation that the Obama victory didn't signal a lurch to the left as he thought it might.
People who believe Obama is a far left populist type haven't been paying attention. Obama himself is no lurch to the left. The far left has been quite disappointed as they've unwrapped the gift they received last November. It wasn't what they asked for or, in may cases, what they thought they were getting. But it shouldn't have been a surprise.
The election wasn't so much a lurch to the left as it was a movement away from the right (a different sort of movement conservatism). People didn't want four more years of anything resembling George Bush. Sure, there's been some reversion to the mean, there always is with midterm elections, but the election did ratchet our collective politics to the left. Moving the nation further to the left might might very well be a long, slow process, i.e. the long fight predicted above. And Republicans do manage to make lots of noise when they engage the enemy. But they are struggling to hold on to what they have rather than trying to take new ground. It's the Republicans, not the Democrats, who need to worry about fighting to hold on to their party.