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March 08 2011



When I think of welfare, I think of pure money transfers from one group to another without any economic basis for the transfer. In such cases, one person’s gain arises from another’s loss. But economic activity that results in the exchange of goods and services is different. It is not a zero sum game. One person’s gain does not come at the expense of someone else.

The main feature of Social Security is not welfare as Samuelson asserts. The main feature is insurance against economic risks and as such it makes us collectively better off. Calling it welfare when it isn’t is misleading and causes unnecessary class distinctions and resentments from the losers ex-post. More importantly, it ignores and obscures the important role Social Security plays in society as insurance against the economic risks we all face.

If you think you are so rich and powerful that you don’t need such insurance, consider this. The stock market collapse of 1929 at the onset of the Great Depression wiped out substantial quantities of wealth. The typical stock was worth only one sixth its pre-crash value once the bottom was reached. Whatever insurance existed in the stock market evaporated as the crash unfolded.

It wasn’t the poor jumping out of windows on Wall street. If you think it can’t happen to you, think again.



Social Security is *Not* Welfare | commentary by Mark Thoma - blog - 2011-03-08
Reposted bykrekk krekk

December 09 2010

Moving pictures

Serpentine gallery, London

New ideas are everywhere in British politics. Let's measure national happiness! Let's make welfare proactive! The problem is that so many of these big ideas for a "big society" come from a government whose painful economic policies make the enthusiastic ideological overproduction look like the most cynical window-dressing – liberal-minded tinsel on a Tory tree whose needles turn out to be razors. Is nobody doing any ambitious social thinking that is not a veil for callous cuts?

Step forward, the Serpentine gallery. This will come as no surprise to fans of its co-director Hans Ulrich Obrist, whose publications, projects and patronage of artists amount to a sustained attempt to reconnect art, ideas, and the world and have made the Serpentine the most creative public art space in London. The latest manifestation of the slightly wacky sense of mission that flourishes at the Serpentine is a community art project with a difference. Skills Exchange brings together artists and community groups and makes a point of linking young artists and older people: out of a residency by artist Tom Hunter on the Woodberry Down estate in Hackney, east London, comes a film he made with older residents called A Palace for Us.

This is a magical film. It weaves the memories of people who grew up in east London and have lived on the estate since it opened into a silvery thread of meaning illuminated by dramatisations of their experiences filmed in the aged, but dignified, Woodberry Down buildings and public spaces. The estate, begun in 1946 and completed in 1963, was like a "palace" to those who remembered the East End slums, remembers one participant. But the film is also a palace of memory. Contemporary art often seems obsessed with youth: here it listens to the stories the old have to tell.

It evokes all our stories. Britain in 1945, out of the ruins of war, built the welfare state that clever rich kids are now so casually pulling apart. Estates like Woodberry Down embody an ideal of decent housing for all that was born out of the miseries of the 1930s and terror of the 1940s. A Palace for Us gently and acutely bears witness to this history that is now being dismantled.

Hunter's film is not a rant, but a moving homage to lives and memories that today are obliterated by harsh and violent caricatures of the white working class. Everyone should go to the Serpentine to learn to see through his subjects' eyes. The government should go.

Rating: 4/5 © Guardian News & Media Limited 2010 | Use of this content is subject to our Terms & Conditions | More Feeds

October 20 2010

Cutting our losses

The art lobby has fought hard, and rightly so. But, as the poor prepare to be trampled on, we must keep a sense of perspective

So the arguments are over, and a nation kneels to the blade. O, executioner, do thy duty! But the visual art lobby has scarcely gone down like a helpless Lady Jane Grey. Instead it has fought back with everything it has got, from Mark Wallinger cutting 25% out of The Fighting Temeraire to Sir Nicholas Serota warning of a "blitzkrieg" on the arts.

Whatever the fate of museums and galleries this week, it would do us good to get a sense of proportion. By which I do not mean passively accepting unfair and destructive robbery of the relatively small public budget for the arts. Proportion in this case means seeing the part within the whole, the bigger picture.

It's disturbing how easily the coalition has played a game of divide and rule. Each sector of public-funded Britain has fought its own battle in isolation from the rest. This means that in effect, museums have competed with scientists, theatres with universities. Do I want Britain's museums to stay free and strong? Yes. But not at the expense of the destruction of scientific research or university teaching.

The picture gets bigger yet. The assaults on culture, science and higher education might be seen, in social terms, as attacks on the same "middle class" that howled its horror when the assault on child benefit for the relatively better-off was announced during the Conservative conference. This is where divide and rule gets nasty: not just playing off art against theatre or Serota against the army, but class against class. The real victims of these cuts will be among those who are already among the weakest and most voiceless in our society. Poverty will deepen, remedial benefits will be removed, and Britain will turn the clock back to a neo-Victorian social nightmare. The implications of swingeing treatment of benefit "cheats" and radical cuts to social housing mean more people will be homeless. This is ugly stuff, and the rich men now governing us plainly have no capacity to empathise with lives that are unprivileged.

What is really horrible about this coalition is the unhealthy blend of hardcore Tory instincts to cut and slash with the woolly Liberal heritage of middle class do-gooders. So assaults on the very concept of the welfare state are dressed up in talk of making people less passive, involving us in our society. Cameron's "big society" idea is the woolliest of all. This is why it really is valid to speak of a new Victorian age: it was in Victorian times that the "undeserving poor" were vilified while bountiful Cameronian types administered big society patronage to the deserving, that is deferential, poor. The point about the welfare state is that it got us away from such cant.

In comparison to measures that will increase unemployment while weakening the safety net, remove protection for children in poverty, and bring back the north-south divide with a vengeance, the impact of cuts on the arts will be negligible. Let's face it, art will survive. But people who have never visited a gallery in their lives are going to get trampled on. © Guardian News & Media Limited 2010 | Use of this content is subject to our Terms & Conditions | More Feeds

June 10 2010

Prisons, power stations and social housing – just not in my backyard | Michael White's political briefing

So-called 'garden grabbing' replaces large and lovely old homes with heartless flats

Ministers announced what sounded like welcome news, the restoration of immediate powers for local authorities to prevent a destructive and undemocratic practice. So-called "garden grabbing" replaces large and lovely old homes with heartless flats and disfigures once-sylvan suburbs with densely-packed starter homes. It is all John Prescott's fault, they say.

But like its earlier ruling this week – rejecting bin taxes in favour of recycling rewards – there is more to the Department of Communities and Local Government's (DCLG) populist initiative than is immediately obvious to voters eager for power to be devolved from Whitehall centralists to locally-responsive councils.

Another word for it is nimbyism, the empowerment of sharp-elbowed locals to prevent developments they don't like – from prisons and power stations to social housing and speed bumps. Everyone knows how the system works, Prescott as well as anyone. He tried to rebalance competing forces.

At issue today was the ex-deputy prime minister's drive to increase the proportion of new homes built on brownfield sites, primarily old industrial land, but also gardens from past eras where land densities – well into the 20th century – were low and gardens large. It has been going on for centuries: every town in Britain must have Victorian homes built in the garden of a Georgian house, modern ones built in Victorian gardens.

Contrary to tabloid assertion, Prescott did not reclassify gardens as "brownfield" – that happened under Margaret Thatcher. But he did increase the pressure on councils to build more homes, more densely, partly to ease pressure on green belt and greenfield sites. Councils found it easier to blame Prescott in the local paper than use existing discretion to dictate precise terms to hungry developers and offend local voters in the process. They use the EU and the Human Rights Act as punchbags too.

Labour's last housing minister, John Healey, was prodded into commissioning research which found a modest problem in some areas.

Some 80% of new homes were built on brownfield sites in 2008, against 56% in 1997; those on gardens 23% compared with 11% – 30,000 of the 150,000 new homes built each year. Too many two-bedroom flats were being built instead of family homes, it was noted.

But the very un-Labour Council for the Preservation of Rural England (CPRE) hailed Prescott's strategy as "one of the biggest yet unsung environmental successes of recent years", now threatened by resumed suburban sprawl. So "decentralisation minister" Greg Clark's remedy overstates both the problem and the remedy.

The recession has halved market-led demand for new homes, but the social need remains. It is unlikely to be addressed by Clark's formula which may tilt power too far away from Whitehall towards the nimby. If so Clark will not be the only Whitehall-based minister who comes to regret early localist decisions rooted in years of soft options shaped in opposition.

The health secretary, Andrew Lansley, has also been busy this week promoting the merits of local decision-taking by the health professionals. He took time off to announce an inquiry into a brutal failure of localism: in Mid-Staffordshire hospital where patients died in lethally-managed wards and no one blew the whistle on it. © Guardian News & Media Limited 2010 | Use of this content is subject to our Terms & Conditions | More Feeds

May 05 2010

Tories discover poverty at last, but is it all in the family?

In the latest in our series in which Guardian writers address an issue they feel passionately about, Amelia Gentleman finds a mixed response to the Tory focus on family breakdown in their 'aspiration' to tackle child poverty

The Conservatives argue that the best way to tackle child poverty is not redistribution, but to look at the roots of poverty and address matters such as family breakdown, addiction and worklessness. Nikki Hewson, a divorced mother of five, is not sure she agrees.

She did not plan to find herself a single parent looking after so many children, but two sets of twins and an unhappy relationship with the children's father has left her unexpectedly alone and struggling financially.

Neither the Conservatives' proposed changes to the tax system in favour of married couples nor their desire to increase provision of relationship counselling would have prevented the marriage from collapsing, she says, drinking tea in her kitchen, raising her voice to make herself heard as the four-year-old twins rollerskate around the room and their 13-year-old siblings storm in and out to collect their breakfast.

"I believed in marriage. We had a big white wedding when I was 22, but we were too young. By the end, the relationship was broken – there was nothing anyone outside could have done to mend it," she says. She had enjoyed working, first as a teaching assistant and later as a lunchtime supervisor, until a stroke made it difficult for her to continue. Money shortages were part of the problem, she adds, rather than the consequence of the marital breakdown.

Benefits she receives from the state put food on the table and clothes on her children's backs, but money is tight so she no longer goes out with friends or buys new things to wear. In the winter, all six of them sleep in one room to cut heating bills. Still, with careful budgeting she is able to give the children what they need. Today they are planning an outing, and will take a train into London to visit HMS Belfast. "I've bought less food this week, to put money aside for it," she says. "Instead of meat and potatoes, they've had beans or egg on toast."

The issue of child poverty in the UK has not been much discussed during the campaign, but it has a newly prominent place in Conservative party literature.

A word search of the parties' manifestos shows how far the theme has edged up the Conservative agenda. It is a crude way to measure commitment, but it is revealing to see that there are seven mentions of the word "inequality" in the Conservative manifesto, and not one in the Labour document; and while the word poverty is used 18 times by Labour and five times by the Liberal Democrats, the Conservative manifesto has 20 references.

Despite Labour's drive to eradicate the problem, there are 4 million children living in poverty in the UK, about 30% of all children, according to a definition that classifies children growing up in a household with less than 60% of the median income for the UK as beneath the poverty line. These children tend to do less well at school and are more likely to have health problems, five times less likely to go to university and less likely to find well-paid jobs.

For the first time all three major parties express a desire in their campaign literature to end child poverty by 2020. David Cameron has repeatedly spoken of his determination to address poverty, accusing Labour of letting inequality grow and poverty worsen.

He got a standing ovation during his conference speech last autumn when he demanded: "Excuse me? Who made the poorest poorer? Who left youth unemployment higher? Who made inequality greater? … No, not the wicked Tories. You, Labour: you're the ones that did this to our society. So don't you dare lecture us about poverty."

In the final leaders' debate, he said: "I believe the test of a good and strong society is how we look after the most vulnerable, the most frail and the poorest." This is a wounding line of attack on a party whose campaign to reduce levels of child poverty it inherited from the Conservatives has been overshadowed by failure to meet a self-imposed timetable to show progress. Gordon Brown, pointing to Labour's commitment to seeing the minimum wage rise with earnings, responded in the Guardian this week: "I know in my bones that Labour is the only party with a passion to eradicate poverty."

Campaign groups working on the eradication of child poverty should be feeling thrilled at the way this issue has moved towards the mainstream. Instead there is uncertainty about the Conservatives' approach and strength of their commitment while the Labour administration's achievements over the past 13 years elicits only guarded approval.

The main cause for unease is the fundamentally different vision for tackling child poverty proposed by the Conservatives. Cameron has dismissed Labour's solution as "more and more redistribution, means-tested benefits and tax credits", and says: "They haven't addressed what is keeping people poor – the family breakdown, the failing schools, the fact that people are stuck on welfare. It's those things that are keeping people trapped in poverty and making them poorer."

On education and employment, the two main parties are broadly in harmony, but the identification of family breakdown as a trigger sets them apart. The Conservative leader has been in touch with counselling organisation Relate to discuss how relationship and parenting education might be made more widely available, and some charities, such as Family Action, that work with struggling families are supportive of this shift in approach.

"I think he is absolutely right," says Helen Dent, chief executive of Family Action, a charity that offers support to women like Nikki Hewson. "There are some families who need a whole lot more practical and emotional support if they are to avoid family breakdown. Money is not the only factor."

Elsewhere there is more ambivalence. Fergus Drake, director of UK programmes with Save the Children, welcomes the Conservatives' focus on poverty: "We feel we are hearing the Conservatives speak about poverty in a way they haven't done for decades."

But he adds that the charity would "be concerned" to see "a shift away from the financial aspects of child poverty to areas around family breakdown and drug and alcohol abuse".

"We would say poverty causes family breakdown," he says, rather than vice versa. "If you are worried about putting food on the table, or being able to turn on the heater so you can have a hot bath, the stress that causes to a relationship can make things really difficult."

Tim Nichols, of the Child Poverty Action Group, agrees that the party should be careful not to confuse causes and consequences. "We don't think that this is robust strategy," he says. "Tackling child poverty can't be done without more redistribution."

Stephen Timms, the minister responsible for developing the government's child poverty strategy, says he has a sense that Cameron is avoiding the issue when he talks about addressing poverty.

"The root cause of child poverty is a lack of income. I get the feeling that they are trying to change the subject to more nebulous things, things like family disadvantage, not income. But this is poverty we are talking about; it is about income."

Some charities are also wondering if there is a subtle change in language from the Conservatives in its attitude towards the goal, first set out by Tony Blair in 1999, and enacted in legislation earlier this year, of ending child poverty in the UK by 2020. Labour speaks of this as a "commitment", they point out, while Conservative politicians refer to it only as an "aspiration". Others note that the Conservatives' record on inequality and poverty in the 1980 and 1990s (when the number of children living in poverty rose from one in seven to one in three), does not inspire confidence.

Theresa May, shadow work and pensions secretary, dismisses these concerns. "We supported the Child Poverty Act when it was going through – I don't think there is any difference in how important we believe it to be. There is a difference in how we want to achieve it," she says. "Labour has a one-dimensional approach: it is about income and the tax credit system. We believe we won't be able to deal with it unless we tackle the root causes – family breakdown, debt, addiction, worklessness. Income has a role to play but we have a more holistic approach."

Child poverty is a peculiar proxy issue – a more palatable shorthand for addressing inequality and poverty more generally. Clearly, long-term success is linked to a mesh of social, education and employment policies and with how well the economy is performing.

In terms of Labour's record, this has been a hard area to squeeze campaigning points from because its successes have been mixed. While activists credit the Labour administration for putting the issue on the political agenda, there is also disappointment that early successes have stalled and ministers failed to meet their own interim target of halving child poverty by the end of this year.

According to the End Child Poverty campaign, between 1997 and 2007-8 half a million children had been lifted out of poverty – the result, among other things, of child tax credits, the minimum wage, and focus on helping lone parents back into work. The government predicts that by the end of the year that figure will have risen to 1.1 million, missing the 2010 target by 600,000.

Research from a US academic last month interpreted the figures more favourably, arguing that by one measure child poverty was cut in two by the Blair-Brown administration, outstripping attempts by the US and many European neighbours to address it.

But any celebration of this achievement is complicated by the parallel rise in inequality. The National Equality Panel report published this year concluded that Labour had failed to reverse the large gulf that opened between the rich and the poor in the 1980s, and found that the richest 10% of the population is now more than 100 times as wealthy as the poorest 10% of society.

On the doorsteps of council flats in the Regent's Park and Kensington North constituency there is no talk of poverty. The John Aird estate stands in the shadow of the white stucco mansions of St John's Wood, a juxtaposition that symbolizes the stark inequalities of modern Britain, but inequality is not a subject that comes up much either.

Labour's Karen Buck is fighting to retain her seat in one of the most socially polarised areas of Britain, a constituency that has some of the most expensive houses in the country alongside one of the highest levels of entitlement to free school meals, one of the highest numbers of households claiming incapacity benefit and one of the highest numbers of children being brought up by unemployed parents. "If they are talking about their own experiences, people will not use the word poverty. They might express it in terms of a struggle or in terms of injustice but they won't describe themselves as living in poverty," she says as she makes her way through the estate, snatching conversations on the staircases, accosting residents by the lift entrances.

"Instead they will talk about the situations that can lead them into poverty. People feel very strongly about the costs of childcare and housing being so high that they are unable to make work pay. Or they might talk about the non-financial aspects of poverty – overcrowded housing and poor housing conditions."

Buck, who was this month named MP of the year by the Child Poverty Action Group for the work she has done for low-income families, is despondent at her party's failure to do more. "I deeply regret that we have missed the 2010 targets, and that the very, very good progress we made until four years ago has tended to falter," she says.

But she has little faith in the Conservatives' approach. "It makes me so angry that smoke comes out of my ears," she says. "Only a minority of families are below the poverty line because of complex factors like family breakdown. The majority have dropped below the poverty line because work does not pay or is not available. People are poor because they don't have enough money." © Guardian News & Media Limited 2010 | Use of this content is subject to our Terms & Conditions | More Feeds

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