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Tuesday, 16 December 2008

Unemployment, compulsion & the blame game

Unemployment, compulsion & the blame game

12th December 2008

On the 27 October 2008 the “Employment and Support Allowance” replaced Incapacity Benefit & Income Support. The new benefit places greater requirements on claimants to look for and find work, or massive benefit sanctions. The “Welfare Reform Bill” before the House of Commons being debated in Dec 2008, is all about massively reducing dependency upon the welfare state – to remove benefits from the people!

Marxists have long realised the fact that" The slave is sold once and for all; the proletarian must sell himself daily and hourly." (Engels) and the threat to dismiss evokes uncertainty and frequently a compliant work force. Marxists interpret current insecurities of the work place as deliberate policy intended to coerce the workforce, and the uncertainties of the system of income support as designed to discipline the reserve army of labour.

Underlying the analysis of both 'problems' and 'solutions' is the failure to trust ourselves, which in turn leaves us unable to trust others, which causes us to identify bogus 'problems' and define unworkable 'solutions'. The level of unemployment becomes less important if governments are able to find ways to provide all permanent residents with a Basic Income sufficient to sustain them.

Job Centre Plus & the Labour Government tells us that any job so long as it is "not illegal or immoral" is better than no job at all, the unemployed are now to be forced into such jobs or lose their benefits. It is not surprising that government trots out clich├ęs about unemployed people's indifference to finding work and all the associated rhetoric of the last quarter of a century.

Governments seem reluctant to acknowledge that many jobs are not liberating, career enhancing, or even sensible options for someone wanting secure employment. Many new jobs are part time, casual, of limited duration, or injurious to health; some are extremely dangerous, and some are so low paid that even full-time workers are living in poverty. Many workers are unemployed because they spent most of their past working lives employed in industries which have been phased out by tariff cuts, or where technological or market shifts have led to huge reductions in the amount of labour required.

The failure of the state to create enough jobs for all who want them or to find ways to share all the available jobs amongst the entire labour force has come to be defined as the 'unemployment problem'. Various 'solutions' have been proffered by governments, welfare agencies, academics and others. Those who are uninformed about the complexity of this issue, and who rely upon the fact that they are employed and that they have not personally encountered difficulty acquiring paid work, frequently assert that there is not an unemployment problem. They claim there are plenty of jobs but some people just don't want to work. They seem unconcerned when confronted by ratios between people registered as unemployed and notified vacancies. Nothing will convince them otherwise.

Some economic fundamentalists like some within the British CBI (Confederation of British Industry), suggest the cost of solving unemployment is too high; attempts to lower the rate of unemployment would result in a distortion of the market, and amount to an interference with liberty. In any case they suggest unemployment may be beyond control, beyond interest, too complicated to solve or an externality. They suggest it may be necessary to keep joblessness at the present level in the general interest of the economy, or perhaps it is some how the unemployed's fault.

There are those who claim Britain doesn't have an employment problem, that unemployment is sectional - affecting only groups they contend are peripheral to productive processes like: the young, the old, the uneducated, those who are not job ready, people with a disability, migrants. Those who use to be on Incapacity Benefit who numbered nearly 3 million are now being forced into “work for benefits” schemes, even though these claimants are ill. The makers of such statements seem unconcerned that the total number of people who constitute these groups nears 5 million.

Preoccupation with economic measurement, market outcomes, commodity prices and share market prices is the result of the widespread acceptance of neo-classical economics. Gross Domestic Product (GDP) or Gross National Product (GNP) is widely accepted as measures of a country's relative economic performance. Since the rise of economic fundamentalism such measures have increasingly been seen as measures of a country's well being.

If, instead of providing hourly economic statistics on TV channels like “Bloomberg” over which average people have no control, the media provided: a depression index, health and happiness calculations, a daily social wellbeing index, daily employment creation and job loss figures then citizens might come to understand the social and personal dimensions of joblessness and might be determine to do something about it.

High rates of unemployment have been attributed to a multitude of causes including: the recent down turn in the economy, too many migrants, the work shy nature of the unemployed or their lack of skills, technological change, payment of unemployment benefits the nature of society - sometimes expressed as the natural rate of unemployment, the rise of part-time work, women (particularly those who are married) entering the labour market, the high costs of labour (wages cost), or by intentional government and industry policy.

It is important to explain what causes unemployment. When the people come to decide who should bear the cost of high unemployment or the cost of solving it, decisions about who should pay are likely to be determined by how voters account for the creation of the problem. Some have suggested that unemployment is an economic problem, something determined by the market, by balance of trade, by cyclical downturns in business activity, and so forth. But unemployment is not just and maybe is not even an economic problem -rather it is a social, political, moral and ethical question. If it were an economic problem, capable of economic solutions then why have the econocrats not solved it?

The highest levels of unemployment in the 1990’s in the UK have coincided with the rise of neo-classical economists to the pinnacle of decision making in this country. Watch my video on Thatcher idea of Britain.

If unemployment is not an economic problem but rather a political, social, moral and ethical question then being a non-economist does not rule ordinary people out of the debate - rather it rules them in. If people are prepared to make the social, political, moral and ethical decisions which can solve unemployment they may find they still need to utilise technical economic tactics to come to solutions but this does not necessitate embracing the ideologies of economic fundamentalists.

The type of economic tactic chosen (as Gordon Brown hopes to use in the next few years) to solve unemployment, for instance creating jobs in health, education and community services, will in large part be determined by the ideological positions adopted.

Once the people determine to raise social priorities above purely economic outcomes, it would not be possible to continue to ignore the costs, personal or social, which unemployment causes. It would no longer be sustainable to define such problems away as externalities. For years the despair which constantly confronts the jobless was ignored by this Labour Government & the previous Conservative Government of the 1980/90’s. Waiting for economic recovery to trickle down from the rich to the poor would not be seen as socially acceptable behaviour.

Citizens prepared to seek socially just outcomes could not, in all conscience, continue to allow people without work to bare a grossly disproportionate share of the costs of unemployment. There would be an acknowledgment that those who are without work don't want a job in the long run, they want one now and whilst they are waiting for a job should be provided with a secure income set at a level sufficient to ensure it would not undermine their future economic viability.

This scenario is predicated upon the belief that Brits want to live in a society which is humane, socially inclusive, committed to egalitarianism, solidarity and social justice. I may be wrong and Britain may decide to continue to reward the greedy, the sneaky, and those criminal capitalist businesses who have brought Britain to its knees, if it did reward those it would usher in the sort of divided society we now have but on a much grander scale.

Recently Caroline Flint MP said as Housing Minister, - unemployed council and housing association tenants should seek work or face losing their homes...She said new applicants for social housing would have to sign "commitment contracts" pledging to seek employment. Council flats in Edinburgh like many other areas throughout Britain are being demolished & tenants forced out in a bid to sell land to private developers who are to build private housing – a modern day version of social cleansing of council tenants or a modern day highland clearance of tenants ?
Local Authorities (Councils) are becoming ultra keen in seeking repossessions after tenants fall behind with rent payments – usually because of Job Centre benefit sanctions reducing the ability to pay. Rent arrears are forced through the County Courts as a policy decision, with extra court costs added to the rent arrears – then eviction unless you pay. It worth pointing out that many Council Libraries have now removed concessionary access for the unemployed. Local Councils have also removed the travel concessionary passes which allowed the unemployed to seek work using public transport.
Unemployment, at least in the short term, is recognised by so-called market economists to be a by-product of industry restructuring, micro and macro-economic 'reform', increased efficiency / competitiveness and globalisation. Some market economists choose to treat the resulting unemployment as an externality and therefore of little consequence. They have no understanding that Unemployed Workers are human beings. If they choose to comment upon it all, they assert that in the longer term due to a 'trickle down effect' employment demand will eventually pick up and in the long term everyone will benefit because of the increased prosperity, the economy is simply left to find its own equilibrium. In New Zealand where this approach to unemployment was adopted with enthusiasm it did not solve unemployment nor did it result in increased prosperity.

There is an even more vicious approach to unemployment, this is: “it's their fault” or blame the victim approach which conveniently denies that globalisation is a game which only the super rich can win. This approach has been around in many guises in Britain. The “it's their fault” approach suggests the reason unemployed people are not able to obtain paid employment is the result of a failure on their part. This approach underpinned the worthy / unworthy / 'less eligibility' debates which have raged in welfare circles since the Elizabethan poor law era. It was a central feature of the post World War II 'workers welfare state' with its work testing and targeting. The 'less eligibility' debates are set to return as a result of the “Welfare Reform Bill” before the House of Commons being debated in Dec 2008.

The elderly were deemed worthy because it was assumed they had made a prior contribution and people with severe disabilities because it was determined that they were incapable rather than unwilling to work, but of late workers are being forced to retire at a later date. Of late those with disabilities are being targeted & forced to work for benefits. The “it's their fault” approach has recently taken on a new virulence. At the very time when Britain as a country has never been richer more and more people are being included in compelled activity requirements.

Persevering with the concept of 'problem individuals' creates difficulties for society. By making 'work' whether in the market economy or 'preparedness to work' in the benefit system the defining characteristic of inclusion, society constructs its own burden. Since the mid-1970s the market has been totally incapable of absorbing all the available labour in Britain and in many other advanced capitalist countries.

The government here in Britain and the United States, New Zealand and Australia asserts that the problem is dependency upon the welfare state. Defining the problem in these terms almost demands the solution arrived at is the removal of, or substantial reduction in, welfare assistance. On 27 October 2008 in the UK the “Employment and Support Allowance” replaces “Incapacity Benefit” and “Income Support”. The new benefit places greater requirements on claimants to look for and find work. Given that we have got the highest unemployment for 18 years the reform has come at a difficult time.
Various US insurance giants are now driving the UK welfare policy, the giant US income Protection Company, Unum Provident, & New Labour are working together, in an attempt to reduce the 2.6 million who were claiming Incapacity Benefit (IB). Unum Provident, has been described in the US as ''an outlaw company that for years has operated in an illegal fashion." and been accused of racketeering and cheating tens of thousands of insured Americans out of their claims.
The “Welfare Reform Bill” before the House of Commons being debated in Dec 2008, is all about massively reducing dependency upon the welfare state – to remove benefits from the people!

In Australia there has been a steep rise in the number of unemployed who have had their Welfare benefits either completely or partially cut off. More than 350,000 jobless people - more than half the total number receiving benefits were penalised during the 2000-2001 financial year for breaches of the federal government’s draconian job search rules. The benefit sanctions caused severe hardship to some of the poorest and most vulnerable members of society, particularly the homeless, and the mentally-ill, jobseekers with drug and alcohol problems, people with literacy and numeracy difficulties, youth and indigenous people. A total of $258.8 million worth of penalties were inflicted during the year, delivering a windfall to the Australian government at the expense of the unemployed and their dependants. An estimated 35,400 people lost their dole payments altogether for eight weeks a threefold increase on the previous 12 months. Many more recipients received the heaviest penalties, ranging from $837 to $1,431, for breaching the government’s “activity test”. The Single Parent Pension (won by the women's movement in the early 1970s) was now stigmatised by the mark of "welfare dependency". The social democratic idea of welfare - that governments had an obligation to guarantee either a decent job or a social payment if they failed-was torn up in the 1980s in Australia. Unemployment benefits are re-badge and restructured as “Newstart Allowances”. The once voluntary programs to help single parents, those with a disability and others claimants into work, became compulsory "obligations".

We need to learn the lessons of what has already happened in places like the US, New Zealand and Australia. In the mid 1990’s The National Unemployed Centres Combine of which I was on the Executive Committee (National TUC Unemployed Centres) promised to raise a national fund to tackle (through judicial review, court action and appeals to the European Court of Human Rights) aspects of the Job Seekers Allowance which, at the time said, impinge on civil liberties or discriminate on the grounds of disability. This judicial review, court action and appeals to the European Court of Human Rights, never happened & yet again the unemployed have been let down by those involved within the TUC Centres & the Trade Union Movement as a whole. Trade Union Members are now going to lose their jobs in this downturn in the economy; we need to organise now before members are faced with unemployment.

A right wing UK Labour Party simply paves the way for an even more right wing Conservative Government. The New Zealand Nationals came into office after a Labour Government had started down the path towards industrial deregulation, free trade, welfare cutbacks and globalisation. This will be the case here in Britain unless we wake up to the threat NOW. New Zealand experienced an economic fundamentalist government which introduced individualised work contract employment and a social welfare system which was incapable of ensuring the poor were provided with an adequate income or decent health services. The Canadians have shown their “Welfare to Work” programmes just didn't achieve their aims. A government report clearly shows there has been no increase in the numbers of employable welfare clients declaring employment income after leaving welfare.

In recent years Australia’s “Breaching" is what the Federal (Conservative) Government (with Labour Party support) had introduced to keep the unemployed under control. The slightest mistake, example, not receiving a letter from Centrelink, or worse, missing one of the meaningless interviews, incurs a fine of $840. Such a mistake reduces the meagre payments of unemployed people by 18 per cent over a period of six months. A second mistake reduces payments by 24 per cent and a third mistake within a period of two years results in payments being stopped for eight weeks — a fine of about $1,400.

In Britain in December 2008 a Labour Government with Conservative support brought before the House of Commons (Parliament) a Bill of which it has copied from Australia, New Zealand & the United States. That bill is the “Welfare Reform Bill”.

Britain Benefit Penalties – make the comparison with Australia “Breaching” policy - "Warning for First Offence, £12 Deduction for Second Offence, £24 Deduction for Third Offence & Then a Probation Order "Community Service order will be placed onto Claimants.

These penalties are harsher than those imposed for many crimes and will force people into poverty. It will lead to them losing their homes and building up massive debts for electricity, water and other services. When people are reduced to abject poverty, their self-esteem and self-worth are lowered, they feel that they are not respected in society, disillusionment and depression sets in, making it more likely that they will become ill, not eat properly, and not have decent clothes or decent living conditions. It is less likely that they will become educated or gain meaningful work.

Marxists have long pointed to widespread unemployment as a weapon capitalists use to tame their captive workforce and hold down wages (Marx 1870 Vol 1

“We need to organise the unemployed – united with the workers in work today, for tomorrow it could be YOU! Trade Unions in Britain need to stop the Welfare Reform Bill - it’s never too late”.