I read Polly Toynbee’s piece in yesterday’s Guardian, nodding in agreement with much of it. The willingness of our Conservative-led government to punish the poorest in our society, while pushing people to believe that they deserve what is coming, has been almost as astounding as the willingness of the general public to accept it.
But there are things that Polly missed, and they are things that need to be discussed if we are to hope to begin to oppose these policies effectively.
When Tony Blair stood up and said that New Labour intended to abolish child poverty, who didn’t applaud? I worked at a Jobcentre when Tax Credits and the minimum wage were introduced, and the effect was astounding. When the minimum wage was introduced, we removed cards for jobs for adults that paid £1.65 an hour. The promise that working families would have an income of more than £200 per week, and the guarantee of a fair hourly rate hollowed out our claimant list. People who could earn enough to feed their families did stay off the claimant list- and as the credit boom unfolded those people were encouraged to buy into it.
The issue that Polly misses is just how responsible Labour are for the situation many of those people will now find themselves in. She is right to recognise the effect of an ageing population, and increased numbers of children and young people receiving Disability Living Allowance on our welfare bill. But the aspect of Labour’s increased welfare spending which needs scrutiny is that directed at the ‘1in work’ poor’. Housing benefit and tax credits acted as a sticking plaster hiding widening inequality which Labour’s economic policies created.
You cannot have a social policy in isolation to your economic policy. Alongside the social policy designed to lift people out of poverty, came an economic policy that was comfortable with the filthy rich getting much much richer, contributing little but fragile credit based growth at everything elses expense.
Inequality didn’t just widen under Labour. The wealth of the people at the top was allowed to reach stratospheric levels. The people at the bottom accepted stagnating wages because the state was filling the gap. The people of ‘alarm clock Britain’ Nick Clegg wants to appease, and the feckless poor Iain Duncan Smith wants to tackle are now the same people.
Tax credits also allowed people to believe mortgages were affordable. Those who bought at the beginning of the credit boom encouraged to treat houses like cash machines, those that came later found a home could only be obtained with a mortgage that bore little relationship to the wages that serviced it. While the credit flowed. this was fine. But the UK now has a personal debt bubble of £1452billion2, we are maxed out, and the banks don’t want to lend any more. The Universal Credit system that was announced in the Welfare Reform Bill, will now seek to claw back the money that is servicing this debt.
Public sector jobs and credit based growth masked the hole that industry left in many of the poorest towns in Britain. But the the regeneration that resulted was illusory. Those jobs are disappearing, and the property bubble that was fed by the easy availability of credit means house prices have soared. In the area I live, you could buy a house for £30k quite easily in 1997, now you would be lucky to find somewhere for less than £110k. Rents have kept pace, even though wages haven’t, and local authorities have been struggling with the weight of the housing benefit bill this created for quite a while.
Housing Benefit was supposed to be a benefit for the very poorest families to meet their basic living costs. Conditions for claiming Housing Benefit have not become more generous, it still only leaves you with a benefit level income after your housing costs are met, but people right up the 3wage scale now fall firmly in the net of ‘welfare dependence’ as they rely on it to stay in their homes.
Labour’s willingness to trade in the vicious hyperbole and cruel stereotypes which win votes at the expense of those who were not working has removed all chance of effective opposition when the coalition apply that rhetoric to everyone who has income that comes from the state. Labour’s approach to Jobseekers Allowance, Incapacity Benefit, and its successor Employment Support Allowance is barely distinguishable from that of our Conservative -led government. The motto of ‘4Work for those who can, welfare for those who can’t” allowed Labour to turn the screw on those who couldn’t for votes. It is Labour’s willingness to use the rhetoric of deserving and undeserving that ensures that there is no party who will challenge it.
There is no political party to point out just how low benefit rates were kept, or to challenge the inaccuracy of this government’s rhetoric and defend the welfare state. Labour have paved the way for Osborne, Cameron and Smith to push through draconian policies which treat anyone receiving state support as feckless. Labour’s economic policies ensured people who should never have been welfare dependent face bleak futures as the sticking plaster applied to make work appear to pay, is ripped away. They have been clear that they will not be defending those outside the squeezed middle who will suffer the consequences. They would also have sought to minimise cuts across departments by focusing on the poorest in the country.
The tribalism that has sprung up since the election, make effective public opposition to these policies almost impossible. The narrative is now defined with a helpless ‘poor’ who Labour must be re-elected to save, or a feckless group who need Iain Duncan Smith to teach them a moral lesson with poverty. The mainstream media’s take on this narrative depends entirely on political allegiance. Discussion of the current situation without questioning Labour’s role in this, and their commitment to changing it, tells only half the story. And we are running out of time to articulate the full story.
Real debate about how this situation came about is the only hope for formulating real strategies to tackle it. Labour don’t need to oppose if we pretend they already are. Labour are unquestioningly painted as salvation, but are committed to the same policies as the Conservatives, albeit at a different speed.
Both Polly and I know the facts that emerge over the next couple of years, are not facts at all. They are the lives of people who will pay the price for this, but it will take a long time before those stories permeate the public consciousness to force real debate.