I really like this blog from today by Bill Mitchell about what he calls the ‘unemployment industry’ and what we would call welfare to work. Talking about Australia, he says this industry’s productivity is practically zero. This resonates here too because we have a Work Programme whose results are worse than doing nothing. Bill draws up some great quotes from and about Arthur Altmeyer, one of the fathers of social security in the US.
I think it’s worth repeating them in full here because it will demonstrate how far we have come from the initial aims of social security, aims that over here were expressed by Beveridge. At an event in 1968 to mark the 33rd anniversary of the signing of the Social Security Act, the US Secretary of Health, Education and Welfare, Wilbur J. Cohen said this of Altmeyer:
“To those who declared that if men were no longer afraid to lose their jobs America would become a nation of loafers, Arthur Altmeyer replied that there was a motivating force in the lives of men that was even stronger than fear–that force, he said, was hope. A democratic society, he said, must rely on hope and incentive rather than fear and compulsion to influence the conduct and aspirations of its citizens. And I think that is a worthy note for us to remember in the issues that face us today. Social security, he taught us, replaces fear with hope. As he put it, liberty means more than freedom to starve. It means a real opportunity to make the fullest use of one’s capacity. Far from destroying individual initiative and thrift, social security, by providing a degree of protection to families against the major vicissitudes that beset them in this modern and complicated and hazardous world, releases energies because it substitutes hope for fear as the mainspring of human endeavor.
In short, Arthur Altmeyer preached and practiced the idea that liberty and security are interrelated and that we cannot have one without the other. With this kind of faith that he demonstrated in man’s perfectability, with this kind of vision of democratic government.”
The bits in bold seem to be the exact opposite of what politicians like Iain Duncan Smith believe today. Far from bringing hope, IDS believes social security has fostered a ‘dependency culture’. Rather than replacing fear with hope, with his new sanctioning regime, he wants to replace hope with fear, believing he can scare people into jobs, or at the very least compel them to stop claiming social security.
Bill goes on to quote Altmeyer from the same 1968 event as saying:
“Before I get off of the early days I want to say another thing–an important thing many people forget. Important as the Social Security Act was, it was only part of the New Deal. We recognized it as largely an income maintenance program. But we had all kinds of work and education programs going. For example, the National Youth Administration. It financed not only vocational schools, but made grants to the colleges, secondary schools, and primary schools. People have forgotten that that was a part of the picture. We had the work programs–PWA, WPA and CCC.
Today I run across people who went to those CCC camps. They are proud of what they did in those days. They go and visit–when they have their vacations– the places where they planted trees, or what not, to show their children, their grandchildren, what they did for their country.”
Now, instead of jobs programmes, we have unpaid work experience and ‘mandatory work activity’. When Duncan Smith talks about dependency he means social security payments are too high, but to Altmeyer, who was dubbed “Mr Social Security” (that would probably sound like an insult now):
“The most important cause of dependency is a lack of jobs at adequate wages. So we must work toward full employment. We must have a permanent, long-range, nationwide public works program.”
As Bill then goes on to write:
“All our modern politicians and policy makers and those who the policy makers have co-opted within the ‘unemployment industry’ they created should reflect on that and work out where they have gone wrong and why.”
Quite.
alittleecon 