Bloggertarians on Benefits.
I have been having a debate with Chris Dillow about benefits. The argument of the libertarian right against the welfare state is that it provides a massive disincentive to work. He says it doesn't.
The response of the left is either to pretend it isn't a massive disincentive to enter or remain in the labour market. The "La La La... I'm not listening" approach exemplified by Polly Toynebee, when I pointed out the gross marginal tax rates that some tax-credit recipients suffer to her, She said flatly "I do not think high marginal tax rates are a disincentive to work" DK calls this the "polly conundrum". Is she stupid and believe what she says, or is she lying. Either way, why is she Britain's top columnist?
The other response is the "moral indignation" approach. This totally fails to address the substantive point that if you provide the means to exist without working, some will take that option. Chris Dillow responded to my post lamenting the demise of the work ethic in the British underclass with a raft of statistics. Basically he argued that most people are out of work for a short time (which is why I specifically referred to "long term unemployed"). But his main argument was that "I was blaming the victim"
The statistics mentioned by Chris refer to "official unemployment" the claimant count, which is a useless statistic, made up to the benefit of the government. Most long-term unemployed have been shifted to the disability register, or otherwise off the claimant count.
So let's look at some statistics from Chris' post:
1. Of the 1.67 million officially unemployed, over 1 million have been out of work for less than six months and a further 269,000 for less than a year (table 9 of this pdf). These are not idle or unemployable; they can’t be, because they were (for the large part) in work recently.Because the long-term unemployed have moved onto other benefits.
2. Of the 178,000 unemployed for over two years, only 33,000 were under 25 - the age likely to be chavs or the product of social breakdown. Almost twice as many of the long-term unemployed are over 50.
3. Unemployment is not a “pool” but rather the difference between two quite fast-flowing rivers. In any one month, almost a quarter of the claimant count measure of unemployed leave or join the count (table 10). If they’re so idle, how come so many of the unemployed leave the register so quickly?Yes. So What? We aren't talking about the claimant count.
4. Of the 8 million economically inactive, over half are students or home-makers (table 13). Only 199,000 - one in 40 - are men under 25 (table 14). For every one young man who’s economically inactive, there are three people who took early retirement.This Age thing is a straw man. 3.4 Million economically inactive people are not Early Retired, Home makers or students. What are they then? Describing an argument as "right wig lies" does not address the point that the benefits system is being abused on a vast scale, with the connivance of Government, who only care about the headline claimant count. I've dealt with this in detail before:
The facts, then, tell a different story from the right-wing talk. They show that the majority of the unemployed are not unemployable idle young people. Instead, they are victims of low demand (not necessarily low aggregate demand), genuine losers from the creative destruction that is inevitable in a market economy, and those who have been discarded by bosses after years of work.
21-22% of the working age population are "economically inactive". That is some 8 million people. Of these 2.3 million are looking after home, 1.85 million are students, though many are simply doing non courses in "tourism management", or "Golf Studies" (a three year degree? I think not) to massage the unemployment figures. 591,000 are retired, 200,000 are Temporary sick, which leaves 2.1 million Long term sick and the remainder some million or so "discouraged workers". There are about a million people on the dole, so the unemployment figure, if you include the fucking lazy (did I say that, I mean "discouraged workers") is actually about twice what the government publishes as the claimant count. These people do not starve. They exist on benefits. Whilst there may not be dole - unemployment benefit - for those not looking for work, the state will see to it that you never actually need to.It is the welfare state that throws most of those 3.4 million economically inactive people on the scrap heap, by providing an easy way out of the labour market and the habit of work. Once ther it's very hard to get back. Only work can lift you out of relative poverty.So you bury your head in the sand Chris, and feel all smug setting up straw men, and demanding tax from the productive bit of the economy to pay for this profligacy. This reduces wages for all, making everyone poorer. Trying to reduce income inequality through the benefits system is at best impossible and at worst counter-productive, providing a perverse incentive to continue the behaviours that cause poverty in the first place.
This is Homer Simpson logic:
Benefits: the cause of, and solution to all life's problems.I agree with the first clause. Chris, you agree with the second. The difference is, my opinion is about incentives. The study of which is called "economics" a subject with which I believe you're familiar. Yours appears based on wishful thinking about the good nature of people. That is why you self-describe as "left". That is why you're wrong.
6 immoderate opinions:
At the risk of repeating myself, a CBI, with a withdrawal rate = flat tax rate would be humane while distorting work incentives as little as possible.
I fear I was insufficiently clear in that post.
My point is that that the right's focus upon long-term unemployment serves to disguise the fact that large numbers of the unemployed are in fact out of work through no fault of their own.
It's an ideological trope, used to focus attention on skills and workshyness, and to deflect questions of risk-pooling.
I don't dispute that the current benefits system has adverse effects upon incentives - which is why I favour a basic income. But there is always a trade-off between incentives and risk-pooling.
If the left is blind to incentives, the right is often blind to risk-pooling.
Sure. I think we agree on much. CBI for example. But Lots of people are unemployed for short periods. It is the Long term benefits reciepient who has lost any will to work who gets my goat. There are jobs. If long -term welfare dependency was not an option, this group would shrink because they would be forced by circumstances to find a job... any job.
I used to take job centre jobs in summers when I was a student. Every manager I worked for said the same thing. "We like students, because they turn up more than once" Many people only take one day's work in order to continue to qualify for jobseeker allowance. Workshyness is a problem, and far bigger than the left wopuld like to admit because it slays so many shibboleths about what the "working class" are actually like.
So long as we pay people to be unemployed, we will have unemployment.
Wow. As is all too common with the so called 'right wing' bloggers I find myself almost nervous about offering my opinion on this subject, but here goes.
I started my blog and named it benefit scrounging scum partly in response to this kind of hatred, not just from the right, but throughout society.
Being on benefits is awful, no two ways about it. The current system is in desperate need of reform, with none of the political parties seeming to agree further than that and choosing to ignore those who could really help to overhaul and perhaps produce a workable system, the chronically ill and disabled.
Without doubt we have a major issue with 'can work, won't work' in some sectors of society, it having become a culture to claim for a whole variety of reasons and I feel quite strongly that this needs to be stopped, however I would point out that trying to live on a very low wage and pay the extremely high costs of council tax, rent, utilities etc these days for many is simply impossible and probably leads in itself to a great deal of fraud.
Moving on to the current popular media target of those (genuinely) claiming sickness related benefits such as myself the issues are different. Many of us would love to work, which I suspect is where the govt are getting their statistics from, people answering surveys saying they want to work, whilst ignoring the fact that they aren't actually capable of work.
In reality it's impossible to separate the welfare costs and issues from others such as health and social care. People like myself fight for years to manage some semblance of control of their health, perhaps to get a diagnosis of their condition and once on some sort of even keel then decide that despite everything they want to work. At which point they then lose their vital support packages from social services, if lucky enough to find a job it triggers a review of (non means tested disability benefits) as starting work is all too often used as a way to remove such benefits, and then said disabled person is no longer able to take up that position as, after all they are still disabled and unable to work/live without additional support. Despite it being better for the individual and economy for that person to be in work that is not something considered by social services while working out their budgets or health so it's a massive catch 22.
Other problems are with transport, employers especially in the private sector not wanting to take people on who realistically may not be capable of full attendance, may need expensive adaptations (not covered by the much hyped but in reality very poor Access to Work) or being only able to access part time very poorly paid jobs so that disabled people once again hit benefit traps. Either a person effectively must work 16+hours a week to qualify for tax credits, or if on Income Support (as many are being hidden amongst those statistics) not at all, and for single people with disabilities and no family support it is near impossible to self support on poorly paid jobs at that kind of level, especially once other benefits are removed. The standard line tends to be that benefits such as DLA are restored on appeal with 'back pay' however for those with severe disability or illness and no other form of support that's not much use 12 months later.
I don't disagree with you, only work can lift you out of relative poverty, but for those who are never going to be able to work full time, however much they want to, a more realistic approach must be taken. The problem will explode over the next 20 years or so (something no-one seems to have planned for) as so many more people are being treated for conditions they would never have survived previously, premature babies surviving etc and disability will only become more complex. Taking an approach where for those who cannot work full time are supported with a realistic level of benefit (plus something similar to DLA) but then without entirely losing, perhaps on a sliding scale that are able to work and pay tax, seen as valuable members of society might be the way to go. I'm no economist, as is probably obvious, but as a disabled person, I do know that seems to be the only realistic way forward to deal with the existing problem of health related benefits.
Bendy Girl
It is well documented that we are seen as country that offers ‘free money"..."http://www.crazybrits.co.uk/2007/11/24/land-of-milkhoney-and-free-money/
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