Benefits and Dependency: 1834 and 2112

New legislation in the UK will modify provision of a huge complex of benefits that have been developed over the past seventy years. The total cost of the welfare state, excluding the National Health Service [which is separately undergoing upheaval], is by far the largest segment of state expenditure. With deindustrialisation and mass immigration of people who come to Britain specifically to live on benefits, this spending has grown massively; and all other categories of state spending have been squeezed.to accommodate it.

The very first duty of government - defence - has been reduced, erratically and detrimentally, in order to protect the social budget. The latest crazy notion for 'saving' from the puerile Department of Defence is to expel soldiers from their homes if they stay in the forces for more than seven years. This will create a huge incentive for the most experienced and useful troops to move on from their service to another career [or even on to benefits if they can't get jobs]. By supporting devices of this kind the Conservative majority of the coalition government is constantly betraying the unwritten rules by which society has been bound together for centuries. The 'Military Covenant' is a pattern of informal but firm understandings as to how society will fairly support soldiers and sailors and their families so that the serving members of the family could give their full commitment to their hazardous duties: and it is being treated with contempt. The plan will submit long-serving soldiers and their partners to the competitive private housing market; where their modest savings and small salaries will place them and their families at a disadvantage . Their children will be plucked out of their schools and transferred into schools in the low-cost housing zones that their parents can afford - which will almost certainly increase the aggregate disadvantage of their environment. Parents compete hard to keep their children out of the sink schools in which arrogant do-nothing head teachers draw high salaries while allowing so-called teachers to encourage their 'students' to run amok in a hierarchy of bullying that is supposedly following a programme of self-directed experiential education.

The current 'reform' of the benefit systems is intended to compel as many people as possible to offer themselves for jobs; any jobs, including the fake jobs that have frequently featured in this blog. Opportunist lobbyists are pressing the government to abolish the minimum wage and reduce requirements on employers to treat their employees fairly. There is a massive push to force benefit recipients of working age [eighteen to sixty-eight] to take jobs: but the economy is not generating anything like a sufficient number of jobs for the non-employed. The state plans greatly to reduce the public sector employment that was recklessly expanded [on borrowed money] by the Blair and Brown governments, so the government will not directly provide employment for the under-educated masses; especially those who have little or no experience of the self-discipline and compliance with regulations that employment demands. Nevertheless the Treasury is providing funds to subsidise notional jobs in charities and in firms. This is a seriously dangerous method:
1. The more people whose fake jobs are subsidised by the state each represent a charge on the Treasury, so the 'saving' from  benefits is transferred to another head of expenditure; and the longer each person is kept in such a post [or in a series of such posts] the more is the cost to the state.
2. People know very quickly when they are being deceived in a fake job. The is demoralising in itself, and it deepens the individuals' disillusion with public authorities.
3. The employers who take on such people are likely to face managerial problems in allocating tasks to people who have no [recent] work experience and no practical skills, which will be disruptive to established employees. Both groups of workers are likely to give the employers more discontinuities of attendance due to stress, threatening the delivery of outputs or services by the organisation. And employment law is a great inhibitor to the organisation accepting short-term state-subsidised jobs, because the occupants of any such posts have a very large range of protection as employees under EU law.
4. Trade unions and lobby groups use both sincerity and cynicism to undermine the whole charade. A recent scam promoted by the government to give 'work-experience' to young people without giving them formal employment contracts [or wages] was subjected to a storm of ridicule and criticism that induced several firms to withdraw from the plan, some of them before anybody had been taken on under the scheme.

There is evidence, visible on the streets in every town and city, that there is a huge pool of non-employed young people who exist in peer-groups whose ethos is inimical to the sort of social values that LibDem and Tory Members of Parliament share. They are on the streets because they find their homes uncongenial, with no legally-earned income to pay admission for them to anywhere else. A reasonable fear of theft and vandalism makes churches reluctant to open their premises to such people; and after paying diocesan levies and pension costs parishes have no resources to provide salaried leaders for youth organisations [while reasonable laws to ensure that volunteers are 'safe'  are a huge deterrent to volunteering].

Young people who incur huge debts to get degrees from marginal new universities fare little better than their uneducated peers in the 'real' employment stakes: one in five recent graduates is unemployed, and additionally about 30% of young graduates are employed in unskilled posts. This problem of a 'wasted generation' is growing week by week. They have no awareness of the phantom of an ephemeral 'big society'.

Many young people in Brazil and in India are also alienated from their families and exist in even deeper poverty than their contemporaries in the UK; but around them they see growth. They see new indigenous branded goods in the shops, and even though they cannot immediately buy them they can aspire to add them to their lifestyle: and they can become motivated to seek real employment opportunities as an access route to consumerism. There are positive reasons all around them which point to advantage from participation in a burgeoning economy. A similar picture faces the single children of hard-working and poorly paid Chinese parents: the parents tell the child that the struggle is worth it, because their family standard of living is palpably improving. There are four grandparents who are all keen to reminisce about the hard times of cultural revolution and sing the benefits of controlled capitalism as a way station on the route to unimaginable prosperity.

In the relatively successful emergent countries politics is seen as part of the pattern of institutions that should foster growth: there would be riots if a government tried to extract tens of billions of dollarsworth of taxation from dynamic firms and hard-working employees to pay benefits to a growing mass of skivers who were allocated to fake jobs by firms whose owners creamed off millions of dollars. In Britain Labour members of parliament applauded such plans when their lot was in power, and now LibDems and Tories applaud their own ministers when they present the same fantasies; while their elderly electors look on in sullen despair and the young [except tiny, perverse, politically ambitious minority] turn their backs on politics altogether. The ways in which politics and the economy interact are very different in different parts of the world. The relationship of the two in China and Brazil is positive, in the UK is it destructive.

Brazil and Britain count as 'democracies' and China does not so qualify, in the view of the US State Department. That test does not take account of economic efficaciousness. The world needs a method of evaluation that reflects the range of  human aspirations, that puts politics in the appropriate place. Democracy on the US model is not a necessary condition for human happiness.

The First Million

UK government figures released yesterday report the number of unemployed young people in the country to be in excess of one million. Labour politicians have made ludicrous attempts to attach the blame for this to the present government. Anyone who has followed this blog knows that the responsibility lies with the entire 'political class' and over forty years or even longer. The story is not just the lack of jobs: the greater crisis centres on the absence of productive jobs in agriculture, industry, education and healthcare; and it applies to all age groups and  it is a part of the contemporary paradox that a significant and growing proportion of the people who carry on working after reaching the age of 65 are in productive activities.Industrial skills, in particular, are held by a smaller proportion of the people in each successive generation.

Between 1945 and 1980 a slow process of deindustrialisation happened spontaneously, despite half-hearted government policy in favour of expanding material exports. Policy was dominated by Keynesian ideas that the system must be fine-tuned to ensure that people were 'fully employed'. In practice this worked out as a series of inflationary 'stimuli' interspersed with periods of raised interest rates and restricted credit. Industrial investments take place over several years between design and the operation of new plant: every time that market conditions and the costs of investment were arbitrarily worsened by the government at the time when investment decisions had to be taken, companies were likely to cut their losses on the design of plant and just shelve the project. This happened again and again. Then from 1980 the Thatcher government had a deliberate policy to rid the country of 'smokestack industry' by removing all protective measures that had been maintained even during the supposed free trade era of the nineteenth century and declining to subsidise 'failing firms' or under-funded start-ups. What Thatcher began, Blair and Brown enthusiastically followed.

There was also a cross-party consensus that state schools should be funded to adopt educational theories that  stressed that 'students' experiences' should take overwhelming preference over orderly instruction. Ignoring the axiom "those who can, do; those who can't do, teach; those who can't teach train teachers'. 'Educationalists' in the latter category developed the theories that supported the comprehensivisation of schools on the cheap. The order and discipline of the Grammar Schools were ditched, together with the emphasis on practical technology - which requires workshop health-and-safety discipline - that had characterised technical schools and the good secondary-moderns. Margaret Thatcher as the education minister in the Heath government [1970-4] was an enthusiastic comprehensiviser and she never showed any subsequent awareness of the ruin that she had wrought. Thus there has been a multi-decade dumbing-down of education precisely where it hurts most: both in intellectual and industrial disciplines. This progressed step-by-step with deindustrialisation and the increase of manufactured imports.

With both industry and education lain waste, high unemployment among young adults is an inevitable consequence: and it is unsurprising that those employers who still have jobs available to fill prefer people from countries where the educational system has been less undermined. Within the UK there is an increasingly conspicuous differential in employability between products of state and private schools.  Parents who can afford to exercise choice in their children's education buy schooling that is anathema to the theorists: schools with order and discipline, pupils sitting in rows for class, plenty of sport and a concentration on 'hard' subjects. What a shock! How dreadful, so to privilege some children over others.

This is very much a British story; no other European country has so recklessly undermined its educational system [though some have gone quite a long way in that direction]; and no other country has so persistently suppressed industry. In the USA there are great doubts about the state of the educational system, and youth unemployment is close to the British level [with very much higher peaks among some ethnic groups in some states] but industrial development has continued across the board, and especially in the higher technologies, despite the collapse of some sectors of low-value-added manufacturing. Rebuilding the US economy can be accomplished within five years: the ruin of the British economy will take at least three times as long to replace.