Welfare doesn't cause poverty – it is necessary for more equality
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Version 0 of 1. Ever wondered how the rich could possibly begrudge expenditure on the poor? US economist Mark Thoma, writing in The Fiscal Times, observed: Rising inequality and differential exposure to economic risk has caused one group to see themselves as the “makers” in society who provide for the rest and pay most of the bills, and the other group as “takers” who get all the benefits. You couldn’t really get a better re-phrasing and re-framing of the prime minister’s favourite Menzies axiom that we’re a nation of "lifters, not leaners". The problem with this view is that it is built on a rather convincing lie. Thoma goes on: The upper strata wonders, “Why should we pay... when we get little or none of the benefits?” Even worse, this social stratification leads those at the top to begin imposing a virtue and vice story. Those at the top did it all by themselves, those at the bottom, on the other hand, are essentially burning down their own houses just to collect the fire insurance. According to this logic, welfare causes poverty and inequality and you only have to look at the lives of those who are "welfare-dependent" to be convinced. This is like saying that hospitals cause sickness and that you only have to look at all the sick people in hospitals to see how true this is. It’s as if you could do away with sickness by tearing the hospitals down. Hospitals actually can cause sickness – along with the stories of healing come some stories of harm. Parking people on income-support payments when they are able to work is no substitute for helping them into employment. But this doesn’t mean that you help people into employment by means of cruelty and punishment. You don’t build people up by putting them down. You don’t help someone into employment by pushing them into poverty. Disability advocates have long made the excellent point that the idea of "disability" largely depends on how we structure our society and our economy. If someone cannot walk up the steps we can decide as a society that it’s tough luck or even that they should be blamed for falling. On the other hand, we can be sensible and build a ramp. The same goes for other experiences of exclusion. Unemployment is painted as a moral failure. The causes, however, are primarily structural rather than personal. For one thing, there are just not enough jobs. Then there are issues such as inadequate or inappropriate skills, housing stress and homelessness, health problems, and difficulties accessing transport or childcare. Welfare payments, by themselves, are not the solution to poverty and inequality. But neither are they the problem, any more than a hospital is the problem that causes ill health. The conditions for the creation of a healthy population actually lie pretty much outside the hospital. Nutrition, the natural and built environment including appropriate housing, income adequacy, empowerment, social connectedness, access to sport, recreation and cultural activity, education... these are the social determinants of health. They are why, for example, the most disadvantaged postcodes in Australia, according to the COAG Reform Council, have four times the number of avoidable hospitalisations. So too with our social security system. An adequate income is crucial, which is why, despite the constant ideological resistance, we continue to advocate for a much-needed $50 a week increase to the Newstart payment (which currently sits at 40% of the after-tax minimum wage) and a change in the way it is indexed. But income support is not enough. We need to look at what locks people out of the labour market. We’re usually not talking about the need for ramps instead of steps in this case. We’re talking about bloody great walls that we’ve built around people before condemning them for lacking the ‘aspiration’ to scale them! This week is Anti-Poverty Week, an annual national awareness event which aims to engage communities in activities to highlight or overcome issues of poverty and hardship here in Australia or overseas. The St Vincent de Paul Society of Australia has today released Two Australias – a report on poverty in the land of plenty, which outlines the investments required to tackle social inequality. Tackling inequality means investing in high quality social and economic infrastructure for the benefit of all. It means high quality education and health being completely accessible to everyone regardless of their income or their postcode, their gender, the colour of their skin, or their disability. It means guaranteeing appropriate housing rather than abandoning people to a private rental market that is notoriously bad at meeting the needs of low-income households. In 2004, Tom Calma, then Aboriginal and Torres Strait Islander social justice commissioner, explained the difference between formal and substantive equality: [I]f there are two people stuck down two different wells, one of them is 5m deep and the other is 10m deep, throwing them both 5m of rope would only accord formal equality. Clearly, formal equality does not achieve fairness. The concept of substantive equality recognises that each person requires a different amount of rope to put them both on a level playing field. Tackling inequality means giving everyone enough rope. As things stand we often think nothing of giving extra rope to those who stand above the wells while leaving those who are stuck down the wells with nothing but the view from below and the dream of sunlight. Which brings us back to where we started. Social spending, regardless of the screams of blue murder from those who have more than enough rope, helps build greater equality. This isn’t just good for the people stuck down the wells. It’s good for everyone since the higher the level of inequality the higher the rates of crime, mortality and physical and mental illness. Inequality is literally bad for our health. Social spending includes, but does not stop at, income support for the people who are outside the labour market either because they are unable to participate in paid employment, due to such reasons as age or sickness or caring responsibilities, or because they are able to work but remain unemployed or underemployed. Well-targeted spending is an investment in the health and well-being of the nation as well as in the overall productivity and participation of the population. It means spending on education and training, on health, housing, transport; all the important elements of social as well as economic infrastructure, without which we will all be poorer as a nation. Our editors' picks for the day's top news and commentary delivered to your inbox each morning. |