Those hailing a return to the principals of Beveridge are forgetting about full employment

I reblogged this post about the Beveridge Report by Jules Birch a couple of days ago, and it reminded me of a recent column by Peter Oborne, in which he outlines how (in his view) incredibly successful the Coalition Government has been in the realm of social policy. This is one of the successes he mentions:

“Iain Duncan Smith’s achievement at the Department for Work and Pensions, in particular, has been monumental. He is returning social security to the arrangement envisaged by Sir William Beveridge in his famous 1944 White Paper.”

This may illicit hollow laughs all round, but it highlights something I have heard a lot over the last four years from people who like to talk about ‘something for nothing culture’ or ‘dependency’. These people say the welfare state should come with responsibilities – the responsibility to look for work (or jump through whatever hoops some bright spark at Policy Exchange or whichever the latest fashionable Thinktank may be can come up with). To ‘get back to Beveridge’ then we need more conditions attached, workfare, sanctions and jobseeker ‘contracts’ to ensure those responsibilities are enshrined.

What these people forget though is that alongside his proposals for the welfare state and the responsibility on individuals – or social service state  as Beveridge himself preferred – he also set out the responsibilities on government with regard to the economy which would ensure this social service state could function as designed. A prerequisite was full employment. Beveridge actually wrote three reports, although we only ever really talk about the first.

His second was entitled “Full Employment in a Free Society”. A summary of the report written by Beveridge himself has been reproduced here, and is quite an interesting read. His recommendations on economic policy are pretty far removed from those asking for a return to the principals of Beveridge today. He writes:

“The first condition of full employment is that total outlay [spending] should always be high enough to set up a demand for products of industry which cannot be satisfied without using the whole man-power of the country; only so can the number of vacant jobs be always as high or higher than the number of men looking for jobs…

…Who is to ensure that the first condition, or adequate total outlay at all time, is satisfied? The answer is that it must be made a responsibility of the State. No one else has the requisite powers; the condition will not get satisfied automatically. It must be a function of the State in future to ensure adequate total outlay and by consequence to protect its citizens against mass-unemployment, as definitely as it is now the function of the State to defend the citizens against attack from abroad and against robbery and violence at home.”

He then goes on to write about how governments should budget, rejecting balanced budget mantras by saying:

“What is the essence of the new budgetary policy required for full employment? It is, first, that the Budget becomes in the fullest sense a National Budget, designed to guide and influence and guide the activities of the whole nation, and not simply to raise taxes and spend them on the purposes of the Central Government. It is, second, that the Budget is made with reference to available man-power, not to money; that it becomes, in Mr Bevin’s phrase, a “human budget”.”

He then rights, which chimes quite strongly with some things we see today:

“To submit to unemployment or slums, or want, to let children grow hungry or the sick and old untended, for fear of increasing the internal national debt is to lose all sense of proportion”

Much as the Conservatives boast of ‘creating’ 1.75m new jobs and of returning the welfare state to the principals of Beveridge, the truth is they (and let’s face it the other parties too), have abandoned one of Beveridge’s key messages and full employment and where responsibility for its achievement and maintenance lie. Left to the market, the quality of job creation has been poor and still vastly short of what’s required.

The number of working households claiming housing benefit up by 63% since 2010

In a blog for Inside Housing, Jules Birch summarises the latest housing benefit statistics which were published yesterday. This section in particular caught my eye:

The number of households who are in employment and receiving housing benefit increased from 650,551 in May 2010 to 1,058,569 in May 2014, an increase of 63 per cent. The housing benefit bill for people in employment has risen from £2.9 billion (14 per cent of the total) to £5.1 billion (21 per cent).

 

The total number of working claims continues to rise (and will carry on rising, according to the Office for Budget Responsibility) even as the number of claims from unemployed people slowly falls. This is consistent with yesterday’s figures showing rising numbers of people in employment and falling unemployment but it also shows the impact of stagnant and even falling earnings on the housing benefit bill. Despite all the government rhetoric about hardworking families and benefit dependency, the stats show the true cost of the boom in low-paid work or (as Joe Halewood points out) the true cost of the subsidy to low-paying employers.

It’s quite staggering that since the election in 2010, an additional 400,000 households can no longer afford to pay the full cost of housing despite being in work. What recovery?

Self employment, money and post-crash economics

My weekly list of links returns. This week, blogs on economics, food banks housing and self-employment. First up, here’s Flipchart Rick with a blog on the remarkable increase in self-employment over the last 12 months:

Self-employed – the nouveau pauvre

On food banks now, and following the Mail on Sunday’s ‘expose’ of food banks, a couple of weeks ago, here, the manager of a food bank responds:

“We will always err on the side of compassion”

There’s been a real trend over the past year of TV docs focusing on poverty and aspects of the social security system. The latest is called “How to Get a Council House” as Jules Birch explains here:

Adjust your set

Here’s a couple of blogs on the DWP. The first details problems surrounding the new Help to Work scheme which aims to bully people into work, and the second is an interview with a Jobcentre Plus advisor:

Chaos at the DWP as bungled Help to Work scheme attempts to launch

Jobcentre Plus advisor: “The reforms have been designed to hide the numbers of unemployed”

Economics now, and there’s a couple of interesting (to me) debates going on in economics at the moment that are getting a bit of attention in the blogosphere. The first is over the nature of money and the role of banks in our society. This blog at Positive Money is quite a good summary of the debate (although I take the other side to them):

The debate on money reform goes mainstream

Another debate in economics has been kicked off following the publishing of a book called Capital in the Twenty-First Century by French economist Thomas Picketty. Larry Elliot in the Guardian explains the hype here, and this book does seem to have single handedly put the issue of inequality back on the table. This could potentially be quite significant as it gives academic respectability to any politician wishing to do something about inequality.

Finally, a third significant event in economics was the publishing of a report by some students at Manchester University into the state of economics teaching at their university. A lot of it chimes with my experience of studying economics (although reading the report, I think my course was probably a lot better). The response from academics has been interesting, mostly denying there is a problem, or playing down the issue. Here’s a good blog suggesting an alternative approach and discusses the response from mainstream economists:

Post-crash economics clashes with ‘econ tribe’

 

Full employment, April fools and stupid Mr Gove

Here’s my weekly roundup of the best links from the last 7 days. The week started with George Osborne declaring his commitment to full employment. This is what some people thought of Osborne’s pledge, but full employment can be defined in different ways. Neil Wilson provides his definition here:

Full employment is when everybody has a job

Tuesday was April Fool’s Day, and Paul Bernal put out this post. It’s actually a pretty good satire that explains the issues a lot of lefties (me included) have with the Labour Party:

Why I’m rejoining the Labour Party

This week also marked the first anniversary of the Bedroom Tax. Here is Jules Birch’s ‘uncelebration’ of the day:

Many unhappy returns

There have been a couple of articles this week by people with a different (and more accurate) view on how the economy works, that have appeared in more ‘mainstream’ sources. First up, Peter Martin blogged on Labourlist about Ed Balls’ desire to run a budget surplus:

The economics of a budget surplus: Something to think about before making rash promises

And here’s one from Philip Pilkington writing in The Guardian about what he sees as the problem the left faces in trying to increase living standards at the same time as shrinking the importance of the financial sector:

The left needs a deft touch in tackling the financial sector’s dominance

Some more non-conventional perspectives now with another blog by Neil Wilson, countering the oft-heard question “How are you going to pay for it?”:

‘Taxation = Government Investment’ : Each Time, Every Time

And here’s another from Peter Martin on what gives our currency its value:

Want to make your business card worth something? Easy. Start a protection racket!

In this article by former financial regulator Bill Black, he explains how the knowledge to prevent the crisis was already available to us but was ignored:

Three Passages From Akerlof & Romer’s 1993 Article That Should Have Prevented The Crisis

Two more bits to finish. First up, a letter to David Cameron on why privatising the NHS is such a horrendous idea:

The best precis of why NHS (and other) privatisation is a Bad Thing

And finally, here’s a video that seems to be going down well with teachers – “Dear Mr Gove”

 

Welfare Cap, Labour are crap

Quite a lot of links this week, and first up, Scottish Independence. Much of the debate so far has been over what currency an independent Scotland should use. In this post Neil Wilson argues that it’s the real resources of Scotland we should be talking about and that a new Scottish currency would be the best option:

Scottish Independence – a Modern Money analysis

A nice blog from Tim Harford next how governments could start to address inequality, using Finland as an example:

Four steps to fixing inequality

And here Jules Birch discusses the welfare cap which passed through Parliament this week with help from Labour:

Does the welfare cap fit? 

Speaking of Labour, here’s two blogs expressing despair at Labour’s general uselessness:

Labour have stolen my Right to Vote

Oh, Labour

A wonkish this one, but I’ve included it, because it’s well argued. If you’ve know any economics, you’ll probably be OK:

Krugman Uses ISLM to Proclaim Looming Fiscal Crisis, Denounces Those Who Don’t Use ISLM

And finally, I found this blog on self-employment by Flipchart Rick interesting. Lots of nice charts as well:

Is the rise in self-employment really a Good Thing?

 

JCP PR fail, Labour MP facepalm and the economics of the 1%

This week’s news has been dominated by the flooding in Somerset and in Surrey. Cameron got his wellies on and sprung into action, promising that “money was no object”. Cynics pointed out that it took until the flood waters threatened the playing fields of Eton before he gave a shit. Here’s some non-flood related stories from the last week.

More on the bedroom tax now, and week by week, this is a policy that seems to be on life-support. Labour have promised to scrap it if they win next year, but it the whole thing may have imploded before we get that far. Joe Halewood explains why here:

Councils cant administer an unlawful policy – The bedroom tax is dead!

Jobcentre Plus news now, and David Henke summarises a big PR failure playing out on social media:

Tweet Wars: How humourless Jobcentre Plus was humiliated by bolshie bloggers

Here’s a nice vid of an interview with economist John Weeks in defense of government:

The Economics of the 1%: Neoliberal Lies About Government

News now of a prominent Labour MP doing something entirely in character for the modern Labour Party, but nevertheless a bit shocking. Lecturers at Queen Mary University in London were part of a national strike over pay, but Tristram Hunt decided to cross the picket line in order to deliver a lecture about socialism! Should he not be standing side by side with workers trying to secure better pay and conditions? Hunt strikes me as the sort of politician who would be comfortable in any party. He doesn’t seem to hold any core beliefs. A pretty typical career politician in other words. Here’s the full story:

Tristram Hunt defends crossing picket line for socialism lecture

Finally, here’s Chris Dillow’s recipe for succeeding in business:

How to succeed

The Bedroom Tax, Big Benefits Row and the degradation of the teaching profession

A lot to get through this week, but first up, the Bedroom Tax. UN Special Rapporteur Sharon Rolnik finally published her report in housing in the UK, and as expected, she repeated her call for the Bedroom tax to be scrapped. What was striking during her visit to the UK last year, was the willingness of Ministers like Grant Shapps to tell obvious lies about the visit, like she wasn’t invited (she was) or she hadn’t met any Ministers (she had). There was a similar reaction to her full report as this Guardian article explains:

Ministers savage UN report calling for abolition of UK’s bedroom tax

But Rolnik’s report wasn’t solely focused on the Bedoom Tax. Far from it. Jules Birch gives a very good summary of the report’s findings in a blog for Inside Housing:

Rights Row

And after some interesting decisions in the appeals courts regarding the Bedroom Tax, Joe Halewood – who has blogged tirelessly on this wretched policy – predicts the whole edifice may soon come crumbling down:

The Bedroom Tax is Dead here’s why

Moving on now, and this week Channel 5 hosted a debate provocatively titled “Big Benefits Row”. I watched it myself and found it to be quite shouty, although actually quite sympathetic to those claiming social security benefits. The two exceptions were Katie Hopkins and Edwina Currie. I’m not sure how much they say, they actually believe, as they both seem to make quite a bit of money from being invited on TV to voice opinions many find offensive, but if they are genuine, they would seem to be outstanding examples of Geogrge Lakoff’s “strict father figure” frame, which I blooged about here. In their world, those who do the right thing, work hard and play by the rules will always succeed, so anyone who is claiming benefits must be doing something wrong. You could see this in the show when a member of the audience explained (very robustly!) how she was volunteering, doing training and applying for endless jobs but still couldn’t find work. Edwina Currie’s response was just to shout back at her repeatedly “Get a job” or “Try harder”.

There were two good blog posts I noticed this week from people who were actually in the studio during the debate Jack Monroe and Sue Marsh:

Dear Edwina, Thankyou for last night. I hope it was as good for you as it was for me.

Diary of a Benefit Scrounger: The Big Benefits Row

Teaching now, and I came across this blog post written by a teacher who has recently left the profession. My partner is a teacher, and what what she tells me, a lot of this rings true. This paragraph in particular hits the nail on the head about the stresses teachers are under:

“What I couldn’t cope with was the toxic culture of fear that now pervades the whole profession. People no longer talk about ‘what this brilliant kid did’ – it’s always about who had a drop in and what grade they subsequently received. As a profession, we have been reduced from largely innovative, invested individuals to a bunch of approval-seeking junkies, because we know we’re only as good as our last Ofsted rating. Forget what the kids think of you; forget what the parents think of you, if Ofsted say ‘nope’, then that’s it. You’re not good enough.”

This is no way to treat dedicated professionals, and as the blog goes on to explain, it’s pretty terrible for the kids they teach too:

Life lessons, fear of failure and why I left teaching.

A couple of shout outs for blogs I like now. First, two posts from Irish blogger Robert Nielsen, one on concepts of freedom, and one on endogenous money:

The Two Types Of Freedom

Endogenous Money Or How Loans Create Deposits

And here’s one by Peter Martin on government budgets, and why when people like Ed Balls talk about balanced budgets and surpluses, we should treat them with scorn:

Why Governments Can’t Choose to Run Balanced Budgets.

Finally, with the Winter Olympics getting under way this week in Sochi, there’s been a lot of negative coverage of Russia and what it’s like for gay people there. Channel 4’s Dispatches program aired a documentary about Russian gangs who target gay people over there and video their actions. It’s pretty horrendous stuff. Here’s a video of some tough Russians from the Interior Ministry showing a softer (but obviously completely heterosexual) side:

Out-Goving Gove, IDS in Apology Shocker and Stupid Back-Bench MPs

Here’s my weekly round-up of links from the last week that caught my eye.

First up education, and the news that Labour spokesman Tristram Hunt wants to introduce licenses for teachers. Some teachers respond:

Tristram Hunt has out-Goved Gove

Iain Duncan Smith news now. It transpires that a few thousand people (IDS says 5,000, others think more like 40,000) have been made to pay the bedroom tax even though they are actually exempt. IDS has now apologised (in the most grudging way possible) and it looks like some repayments may be made. Jules Birch gives full details here:

The Hardest Word

Onwards now, and some MMT-related stuff. I bang on about the job guarantee idea a lot here but this slideshow produced by the blogger Senexx is worth linking to:

What a Job Guarantee Is

Also worth a watch is this short video on Peter Martin’s blog:

How come that nearly everyone, gets it all wrong on money and the economy?

Here’s the promised stupid backbench MP news now, with the revelation that Tory MP Philip Davies (who’s also my MP) has been watching Benefits Street and so is now an expert on the problems with the welfare system. When I tweeted this link, someone replied that he also described incapacity benefits as unnecessary after watching the film “Cocoon”:

Shipley MP Philip Davies says benefits ‘too generous’ after watching Channel 4’s Benefits Street

And while we’re talking about Benefits Street, here’s a nice post from Chris Dillow it’s probably not reasonable to expect current affairs programs to be bias-free:

How current affairs reporting is inherently biased

That’s about it for this week, but I’ll leave you with this image someone tweeted the other day which sums up how I feel about the term ‘hardworking’.

Hardworking

Benefits bashing, house prices and the right to protest

A lot to get through this week. A lot of stuff caught my eye, but maybe that’s just because I’ve been paying attention. Here then are a few links worth reading from the last seven days.

Starting with housing, Jules Birch put up a nice post about Help to Buy and house prices:

Appearance and reality in the 2014 housing market

And here in a blog for Inside Housing, the same author pours cold water on Tory plans to remove the right to claim housing benefit from under 25s and to exclude people earning over £60,000 a year from council housing:

Benefits baseline

On to universal credit now, and news of more IT problems at the DWP:

Government descends into inter-departmental squabbling over Universal Credit

Staying with the DWP, Jonathan Portes blogged about the results of a DWP pilot called “Help to Work”. The evaluation of the pilot was released with no fanfare on the DWP website, probably because it shows the new measures had very little impact, despite the cost:

The “Help to Work” pilots: success, failure or somewhere in between?

Benefits more generally have been in the news a lot this week after the showing on Monday of a charmingly titled documentary called “Benefits Street”. This stirred up a lot of anger on both sides, and led to more head-scratching about what to do about the welfare system. Regular readers will know I think a job guarantee would go a long way to improving the (economic and welfare) systems. I lot of objections are raised about this idea, and one of the job guarantee’s leading proponents, economist Randy Wray has helpfully produced a post responding to some of these common objections:

BOP A MOLE #2: JG WORKERS WILL DO NOTHING USEFUL, THE JG PROGRAM WILL NOT BE MANAGEABLE

Finally now, and on a different topic, some worrying news for civil rights – the Govenment’s  Antisocial Behaviour, Crime and Policing Bill. George Monbiot in the Guardian wrote that this could be used to stymie the right to peaceful protest among other this:

At last, a law to stop almost anyone from doing almost anything

Although as Mike Sivier highlights, certain parts of this bill could be blocked in the Lords:

Foiled! Lords veto Coalition bid to make being ‘annoying’ an arrestable offence

Last 7 Days Reading List 04/01/14

Much of the news this week was about either the weather or the tidal wave of new migrants from Romania and Bulgaria that would apparently been sweeping in come January 1st. On both counts the media seems to have been a bit disappointed. The weather wasn’t quite as bad as forecast, and despite camping out at airports and bus terminals, journalists – and bizarrely, Keith Vaz MP – did not observe half of Eastern Europe queuing up at the border with their applications for benefits already filled in. All a bit disappointing.

Not much caught my eye this week, but here’s a small selection of non weather/immigration stories.

Outrageous bankster news first, and Matt Taibbi of Rolling Stone reports on the fine given to HSBC for laundering drug money for Mexican cartels. No one from HSBC was prosecuted:

Outrageous HSBC Settlement Proves the Drug War is a Joke

On now to David Cameron’s flagship internet porn filters, with the news that guess what? They don’t work, blocking everything from the NSPCC to the British Library to – hilariously – Claire Perry’s website. Remember, she’s the MP who campaigned loudly for the introduction of filters even though it was clear she had no idea what she was talking about:

Cameron’s internet filter a disaster

The economy now and a nice article by William Keegan in the Observer on welfare cuts and Coalition policy:

Big society? Cutting welfare to ‘aid recovery’ is just a big lie

Finally, some housing news, and a blog by Jules Birch for Inside Housing on developments in the sector over the Christmas period. A good read:

While you were away