Monday, 4 October 2010

Why _not_ remove child-benefit from the rich?

Here's why:
The problem with taking away child benefit from the rich is that the more you remove universal benefits, the less stake the rich have in the welfare state. Some people already say to me on the doorstep: 'Why should I pay all these taxes? I don't benefit from the tax-take!' This problem will only worsen, if you start in effect means-testing even more benefits (Because that is what removing these benefits from the rich actually amounts to - a 'kinder, gentler' means-testing.).
So: this ConDem move will delegitimise the welfare state.
Actually, when you put it like this, it isn't so hard to figure out why the Tories are happy to do this... Because many of them WANT to delegitimise the welfare state! So this move, that seems so 'reasonable' and sensible - the Radio 4 reporters are all saying things like 'Yes, surely rich people don't NEED winter fuel allowance / child benefit, etc.', is actually a very clever political device for the long-term restructuring of the political consensus in this country in a rightward direction.
There is no way around this: it is an inevitable dilemma of a welfare state constructed around a complicated benefits system. There is no way out of this dilemma: except radical policies to change the status quo in an egalitarian direction. We need a genuinely progressive tax system (i.e. tax the trich more, rather than taking benefits away from them), a citizens' income (slicing through the baroque welfare system and replacing most of it with one benefit that goes to everyone), and a raft of other measures that will take us in the direction that Wilkinson and Pickett are talking about. Unless we attain greater equality, the rich will always be looking for ways to opt out of the benefits system, and to delegitimise it. That is what this latest episode is a symptom of. However 'reasonable' it sounds to reallocate child benefit away from the rich to the poor, it is actually a move that will have the effect of undermining the very long-term acceptability of the welfare state.
 

5 Comments:

Blogger James Bloodworth said...

Bingo!

I was going to write a post saying the same thing as I hadn't seen it written elsewhere until now.

That was the whole purpose of non-means tested benefits - it gives the middle-classes a stake in the welfare state, as well as gives them an appreciation of its value.

At first you would sensibly question why relatively wealthy individuals receive any benefits at all, but you are correct, it is about having a consensus on the welfare state - cutting benefits for middle-earners undermines the welfare state just as private education and healthcare undermine their state equivalents.

5 October 2010 at 12:35  
Blogger tiny.bit.green said...

Excellent point, I must admit I had immediately saw it as a good idea but hadnt considered that point. – It has me thinking, I wonder if it might be a slightly dangerous way of justifying the welfare state? It might leave open the argument that for a good or service to be right all must benefit equally from it. There will always be people who are more in need of some resources and services than others. I currently don’t need the NHS frontline services or child benefits purely because I am fit, healthy and I have no dependants but I value those services even though I don’t directly benefit. . . yet.

5 October 2010 at 19:00  
Blogger Rupert said...

Thanks folks.
Tinybitgreen: The analogy for the NHS would rather be taking away NHS provision from the richest, on the grounds that they can afford private healthcare. I hope it is obvious why that would be a bad thing.

6 October 2010 at 08:39  
Blogger Rupert said...

I'll be blogging more on this on LIBERAL CONSPIRACY tomorrow.
Cameron's speech today confirms everything I wrote above: "We're all in this together" was his theme. In this context, Osborne's move on child benefit clearly was PR genius, NOT a 'trainwreck'.

6 October 2010 at 21:49  
Blogger Rupert said...

Normally, it is radically implausible when a Tory PM (especially a posh one with a PR background) says that we are all in this together, except in wartime. But their move on child benefit, _especially_ given the furore about it, has suddenly made it sound plausible to many ears.
So here's the rub: every time a leftie blogger writes about what a dreadful mistake the Tories have made here, alienating their own supporters, creating anomalies, taking money away from stayathome Mums, they are (by so writing) _helping_ Cameron. Helping to make him look like a brave beleagured PM making tough decision against the interests of his own rich backers and in the face of howls of criticism. Helping to make him look fair-minded, 'progressive'. ...And helping thereby to hasten the cuts agenda and the decline of the welfare state...

7 October 2010 at 09:59  

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29.
Here's why:
The problem with taking away child benefit from the rich is that the more you remove universal benefits, the less stake the rich have in the welfare state. Some people already say to me on the doorstep: 'Why should I pay all these taxes? I don't benefit from the tax-take!' This problem will only worsen, if you start in effect means-testing even more benefits (Because that is what removing these benefits from the rich actually amounts to - a 'kinder, gentler' means-testing.).
So: this ConDem move will delegitimise the welfare state.
Actually, when you put it like this, it isn't so hard to figure out why the Tories are happy to do this... Because many of them WANT to delegitimise the welfare state! So this move, that seems so 'reasonable' and sensible - the Radio 4 reporters are all saying things like 'Yes, surely rich people don't NEED winter fuel allowance / child benefit, etc.', is actually a very clever political device for the long-term restructuring of the political consensus in this country in a rightward direction.
There is no way around this: it is an inevitable dilemma of a welfare state constructed around a complicated benefits system. There is no way out of this dilemma: except radical policies to change the status quo in an egalitarian direction. We need a genuinely progressive tax system (i.e. tax the trich more, rather than taking benefits away from them), a citizens' income (slicing through the baroque welfare system and replacing most of it with one benefit that goes to everyone), and a raft of other measures that will take us in the direction that Wilkinson and Pickett are talking about. Unless we attain greater equality, the rich will always be looking for ways to opt out of the benefits system, and to delegitimise it. That is what this latest episode is a symptom of. However 'reasonable' it sounds to reallocate child benefit away from the rich to the poor, it is actually a move that will have the effect of undermining the very long-term acceptability of the welfare state.
 
30. 31. 32.