Here’s a nice profile in the Guardian of my colleague Dave Brady, who was in London recently talking about poverty and social policy:
Brady’s response is that we need to rebuild trust in a welfare state that everyone feels they benefit from. The problem he sees developing in Britain is similar to the situation that exists in the US, where welfare is now only for the very poorest people.
“The more [that] ‘welfare’ is a broad portfolio of social policy to help people across the life span, the more effective it is at reducing poverty,” he explains.
“If you create a small constituency of beneficiaries that doesn’t have broad-based political support, it’s harder to mobilise in support of those benefits.”
For evidence, Brady points out, look no further than the ease with which the welfare reform bill got through parliament compared with the ferocious fight the coalition government has had to get the health bill on to the statute book.
Unluckily for me, Dave will soon be heading off to Berlin to be a director at the WZB, despite the city’s near-total absence of quality baseball.
{ 13 comments }
LFC 03.21.12 at 2:20 pm
One of the more interesting bits of the Guardian article is the paragraph toward the end where Brady says that how money is spent post-tax is more important than how progressive the tax structure is — i.e., redistribution via govt programs rather than taxation. But precisely b/c universal welfare programs (like the NHS e.g.) have always been a hard or impossible sell politically in the U.S., the progressiveness of the tax structure arguably takes on more importance, at least in the U.S. context (and perhaps even in the UK as well).
MPAVictoria 03.21.12 at 4:04 pm
“The more [that] ‘welfare’ is a broad portfolio of social policy to help people across the life span, the more effective it is at reducing poverty”
Wise words
guthrie 03.21.12 at 4:08 pm
Yes.
Hence the Mail headlining with “A quarter of your taxes goes on welfare” or similar a couple of days ago. Never mind that their readers benefit from the welfare and doely scroungers, all 3 million or whatever of them, only take up a small proportion.
Christiaan 03.21.12 at 4:14 pm
“The problem he sees developing in Britain is similar to the situation that exists in the US, where welfare is now only for the very poorest people.”
I think this is wrong (though I don’t know whether it’s a mistake from Brady or Benjamin), it should say:
“The problem he sees developing in Britain is similar to the situation that exists in the US, where welfare is now seen as only for the very poorest people.”
In fact, doing numbers properly and accounting also taxation benefits/deductions as welfare (handing out a sum of money is essentially the same as reducing taxation by that same sum of money) there are good reasons to suspect that most welfare in the US goes to the rich. A recent NYT article discussed how most people in the US, especially middle class and rich, don’t know when they benefit from the government.
This does not affect the rest of the statements though, as it is all about perception.
Republicans have performed an excellent con job.
Billikin 03.22.12 at 12:10 am
“the US, where welfare is now only for the very poorest people.”
Scuse me, we have welfare for rich people, too.
white collar crime kills 03.22.12 at 2:58 am
Largely from an intuitive sense, i think standardizing all assistance (residence tax deductions, overseas marketing grants, nuclear power generation liability ‘immunity’, etc) into one uber service, would maintain common realization that it’s all “assistance”. This is the “more skin in the game” philosophy.
Remove much assistance/welfare from taxes and wherever the assistance is hidden, and force all through similar initial application process.
white collar crime kills 03.22.12 at 3:12 am
PS. Many people see a need for a similar “level playing field” “skin in the game” regarding punitive fines. Since “defunding” is the chosen form of punishment, wealth should be Basis of punishment. The level of “pain” is a constant proportion/Factor. Calculate the amount of the fine from Basis x Factor.
Alex 03.22.12 at 11:05 am
What is this “welfare” thing? Something they have in America?
mpowell 03.22.12 at 7:08 pm
One of the problems in the US with targeted wellfare policy is that the marginal tax rate on people struggling to escape poverty can easily approach or exceed 100%, depending on their exact situation and the exact suite of state benefits they qualify for. Ironically, it is the libertarians on the right who spend the most time pointing this out, and their solution is to eliminate those benefits that keep the children of poor families fed and off the street. The better policy would, of course, be to slow down the phase out of those benefits. The even better policy would just be to provide universal healthcare and take one of the biggest benefits out of the equation. That would do more to provide a decent quality of life to every citizen (keeping people alive is the first step after all!) and could avoid the hassle of having lower middle and middle class families juggling a wide suite of state benefits.
Also ironic is that most of the state spending in the US isn’t currently means tested- it goes to medicare and SS, but the public is so clueless about actual policy that it is easy to demagogue the issue. I think that it is essentially true that as programs are perceived as ‘being for the poor’ they will tend to suffer. This is unfortunate because I think there is a perfectly good argument that programs for the poor pay for themselves over time. Especially in the US with so many poor people and so many of them in prison, I am quite certain that the marginal dollar the state spends on helping children in poverty is a dollar saved in the long run. But the public tends to fiercely maintain an attitude of “the beatings will continue until morale improves” towards helping the poor. Arguments like this aren’t likely to make any progress in the public sphere. Even are elites are morons, unfortunately, otherwise I think you could make progress on this issue through this argument without having to persuade the larger public.
Watson Ladd 03.22.12 at 9:03 pm
I remember reading in the NY Times how many of those on food stamps who were eligible for other programs did not claim them. Unifying the welfare system would make it significantly easier to ensure people claimed benefits due them.
But one of the beauties of the IRS is how efficient it is. It knows everything it needs to see if you need cash transfers. Why not integrate welfare into it? And so now we are back at the Friedmanite negative income tax idea.
Henri Vieuxtemps 03.22.12 at 9:41 pm
Just force them to pay decent wages, and that’s the only welfare policy you need. Make the minimum wage $25/hr, provide free occupational training, and all that. Would it produce this illusive “broad-based political support”? Of course it would, except that in reality no one cares about any broad-based political support; the only support that matters is support of a handful of individuals and institutions.
Tim Wilkinson 03.23.12 at 11:04 pm
Child benefit highly relevant to this point, as described here: http://surelysomemistake.blogspot.co.uk/2010/10/economic-state-of-emergency.html (as weakly ‘predicted’ in comments, they have back-pedalled a bit now the need for an early ‘all in it together’ gesture has been made, and the universality of the benefit broken).
UserGoogol 03.25.12 at 11:39 pm
Henri Vieuxtemps: Decent wages only helps people with jobs, who are only about 2/3 of the adult population. Employment is simply not a secure enough source of income to maintain sufficient financial security for all people. If you want people to be able to live secure lives, they need to be able to have a safety net regardless of their ability to work. And $25/hr seems kind of high anyway.
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