British Haves and Have Nots
There are two things that have really struck me this week: Osborne’s proposals to make real term cuts to welfare and the impending arrival of a new royal baby. To my mind these things are inextricably linked. Before you ask this isn’t bourn of too many mince pies and mulled wine before Christmas.
We are increasingly living in a polarised society of haves and have nots. The Tories are trying to weave a narrative that pits ‘strivers’ against ‘scroungers’. However, our attitude to the news of a royal baby to me shows how confused our attitude to the state and state provision has become. The British Monarchy is a cornerstone of our social structure but one that is arguably funded by the public purse. Currently, the monarchy receives 15% of Crown Estate income amounting to about £200 million a year. Debatably this land isn’t private land but land kept in trust for the public. Further, there are myriad costs of running the monarch including security and special occasions such as the Jubilee celebrations. While the public subsidy for the monarchy has been subject to trimming, few have expressed anything but delight at a new addition to ‘the firm’.
This piece doesn’t seek to make the case for a Republic but instead to probe why we can express unreserved joy at the impending royal birth and simultaneous disgust at so called scroungers and their families. Osborne’s decision to increase welfare benefits by 1%, under the rate of inflation will mean real term cuts for many. One of the groups who will be adversely affected by these cuts are mums (and dads for that matter) who will be hit by below inflation rises to child benefits and working tax credits. This has been termed the mummy tax by Labour. The term seeks to highlight the impact of Osborne’s tax cut on real families who rely on these benefits to work and support their families.
The author, Sara Ibrahim, works in law like me. I find her juxtaposition of royal family and welfare recipients to be clever and I recommend you read it in full.
The problem of haves and have nots is not a purely British phenomenon. The United States has increasingly become two societies with different laws, expectations and responsibilities for the different classes. Single mothers with three convictions for marijuana possession can wind up with fifteen years in prison while bankers who launder nine billion dollars in drug money are unprosecuted.
Business ethics under these circumstances become more and more a matter for humor. Business ethics cannot exist in a moral vacuum. There has to be support from the press, the church and the state. Having two societies moving in different directions complicates that support and promotes the moral vacuum.
There maybe some of my readers who may find some justification for very large differences in income. But is it so easy to justify two standards of law, one for the great mass of Americans and another for the one percent?
From around the web –
From the web site, The Guardian:
There’s nothing new about the attempt to divide “benefit claimants” from deserving working people. Tough settlements for the welfare system have long been justified by claims to be cutting largesse from an undeserving poor. But neat categories like these have long been confounded by reality, and changes in the welfare system over the past 20 years have made them all but nonsensical. As Resolution Foundation analysis shows, 60% of the chancellor’s benefit squeeze hits working households. Whatever the rhetoric, it’s so-called strivers that bear the brunt of the cuts.
Why is the formula of “skivers and strivers” showing signs of age? One reason is Labour’s system of tax credits, which changed welfare by supporting low and middle income working households – the group the chancellor claims to be talking to. Tax credits themselves were in part a political move, to change the debate about welfare and poverty. But they also reflected new economic realities: childcare costs had soared, and many parents, particularly women, could not afford to work. Meanwhile, low pay had crept up to epidemic levels. For the one in five working people who now earn below £7.50 an hour, in-work support is vital.
From the web site, Alex’s Archives:
Plenty of political announcements made at this time of year are little more than conference fodder. They grab a headline and a round of applause and that’s the last we hear of them. But George Osborne’s proposals to cut another £10bn from welfare don’t fall into that category. They were buried in the detail of previous policy statements and it was only a matter of time before they bubbled to the surface. Conference season is the ideal time because it allows some posturing against the modern folk devil – the feckless scrounger.
We only have media reports of Osborne’s speech at the moment, and we’ve no idea what’s going on behind the scenes, but a key element to this story is going to be how it plays out within the Coalition.
Clearly the New Victorians of the Conservative party are full-speed ahead for cutting welfare, with a strongly Malthusian undertone that if we lose a few scroungers along the way through starvation then that’ll save us a bit of money.
And finally from the web site, Liberal Conspiracy:
At the Autumn Statement we were told that the Chancellor is increasing spending on infrastructure whilst cutting spending on welfare. Such statements are confusing “infrastructure” for “lumps of rock”.
There are two reasons that you would increase spending on infrastructure. The first is that you believe that the spending itself will be good for the economy: the money will create jobs, the newly employed people will buy new things, shops will employ more people, etc.
The second reason might be that you believe that the underlying framework of your system could be more efficient. The classic example would be that late trains cost people time working, so you invest in better train lines.
However, in practice, I see very little notable difference between what Osborne sees as ‘welfare’ and what he sees as ‘infrastructure’ – other than who it is for. What the Chancellor calls infrastructure, I could call corporate welfare.