Saturday, 20 August 2011

Solving the Solution

What do the English riots and social problems in remote Australian Aboriginal communities have in common?  Well, there are probably a few things but one of them is that they have brought both critics and defenders of the welfare state to the fore.

For the defenders, the riots are a protest against the welfare cuts of the new Tory Government.  They are an overflow of the stress of poverty exacerbated by the fear of lost entitlements.  For the critics, on the other hand, these generous welfare measures are part of the problem.  They encourage people to think that the world owes them a living, and enculturate them into a "something for nothing" mentality which disempowers them and disengages them from society.

This same debate has been going on for years in Australia, particularly focused around the problems of Aboriginal communities.  Noel Pearson, a prominent Aboriginal leader from Cape York, has long been a critic of the welfare state, seeing it as destroying the initiative and economic independence of Aboriginal communities.  Other Aboriginal advocates, like Pat Dodson, see the problem as about economic injustice, and the solution in a greater level of wealth redistribution via compensation for stolen lands.

This is a complex debate, and one so easily hijacked by politicians for their own ends.  A little historical perspective might help keep the discussion more open.

The creation of the modern welfare state was shaped by two pivotal 20th Century events - the Great Depression, and the Second World War.  The Depression saw mass unemployment with almost no welfare safety net.  Unemployed men and women tramped the country looking for work, and those who could find it were often little better off as wages dropped below subsistence levels.  The experience was deeply shocking.

The War was shocking in a different way as many of the same men went off to fight, and often die, for what they saw as their countries' interests.  Meanwhile those at home worked and sacrificed for the promise of a better society to emerge after the war.  This sacrifice was seen by many as a clear social compact - we will fight and sacrifice now, and after it is over we will work together to create a better society.

Delivery of the welfare state was a clear part of this compact, and the decades after the war largely saw this fulfilled.  Unemployment benefits were put in place for those who couldn't find work, and also for those who couldn't work for reasons of disability or parenting responsibilities.  Public housing took the place of inner city slums.  Public hospitals ensured universal access to basic health care.  Public schools ensured the same for education.

Those of us who grew up after the war largely take the resulting security for granted.  The fact that starvation is almost unknown in our society, that most people can read and write, and that even the poorest can have high quality cancer treatment, is no longer amazing to us.  Hence, it is easy for us to find ourselves nodding when right wing commentators blame this system for many of our social problems.

So how has the solution come to be seen as part of the problem?  Well, I'm tempted to just blame the right and their big business backers who would prefer to pay less tax and who can afford to pay their own medical bills thanks.  However, this sounds so much like a slogan that there must be more to it.

I think a big part of the problem is that our welfare system is very much an industrial insititution, and it is trying to cope in a post-industrial society.  Public housing estates are a great example.  After the war, large estates were built in places like Inala on the edge of Brisbane, Broadmeadows on the edge of Melbourne, or Elizabeth on the edge of Adelaide.  These estates were located near large industrial areas, and their working class residents worked in these industries.  Their children were educated in the local public schools and those who didn't use this education to escape to the middle class went and worked in the same factories as their parents.  Social security provided a backstop for when jobs were in short supply.  The same story can be told in remote Australia, but substitute Aboriginal communities for public housing estates, and pastoral work for factory work.

This all worked fine up until the 1970s, but then things started to change.  The factories that didn't close automated.  Cattle stations substituted helicopters for men on horseback.  Suddenly communities which had vibrant economic lives turned into communities where there was nothing to do.  In the process of this change unemployment rose back towards where it had been in the Depression, and people started moving again.  However, this time the movement was different.  Those who had been best able to take advantage of the educational opportunities created by the welfare state moved out of these communities to where they could find work.  Those least able to use this education, for whatever reason, stayed on or moved in to places where they were now trapped in a cycle of poverty.  Thanks to the welfare state they didn't starve, but there was no exit plan. 

The welfare state is not the problem.  The problem is the structure of our economy, and the way it rewards some while excluding others.  But neither is it the solution it used to be.  It still provides subsistence, and idleness is more bearable if you're not constantly hungry.  But its industrial assumptions, its mass programs and its system of rewards and punishments are not geared to the post-industrial world.

The most popular solution, touted by conservative poticians the world over, is the idea of "mutual obligation".  This misses the point.  The welfare state has always involved mutual obligation.  It has always been a social compact.  People receive unemployment benefits as long as they look for work.  People receive public housing as long as they pay the rent and care for the house.  Those who fail to meet their obligations will have their benefits cancelled or be evicted from their housing.  21st century advocates of mutual obligation are not changing anything, they are just beefing up the sanctions.

The solution to this problem would require a series of posts which, despite being a social policy professional, I'm hardly qualified to write.  However, a brief teaser.  The problem with "mututal obligation" policies is that at present we don't have a framework for making them truly mutual.  We know what we want of recipients - work or study hard, make an effort, contribute to society.  However, we don't really know what we want the State, or the society, to deliver. 

We think these people should have access to work.  But providing work is left to the market.  What happens when the market doesn't deliver?  What happens when we painstakingly train someone for an occupation which becomes obsolete?  We want people to move from poor communities where there's no work to areas of high employment.  But what housing is available to them there?  What communities will they become part of and from where will their social support and companionship come?  If they are Aboriginal, how will they fare in a foreign culture, away from their country, and who will help them and welcome them?

Simply cutting welfare, and increasing sanctions for non-compliance, won't do the job.  These are industrial-scale responses unsuited to a post-industrial world.  We may even (shock! horror!) need to spend more on welfare to get the outcome we need.  But we need to understand it as an investment, and invest wisely.

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