Opinion: Welfarism is a failure of capitalism

Shadow Secretary of State for Education CDocwra writes for the Guardian.

The views expressed in this article are those of the author and do not necessarily reflect the opinions of The Guardian.

I want to begin this piece by asking a question, why is it that we have the highest employment levels in this country since the first half of the 1970’s and yet there are millions upon millions of people who receive welfare? Furthermore, why is it that many of these millions are people in full time employment? It’s not because these people are not working hard enough, I think it is rather insulting to say or imply that people would rather live off a government subsidy than work. It’s not because we have a welfare system that is too generous, the Negative Income Tax and other measures allow people to live at a basic standard of living not a fanciful one. It is because the culture of welfarism that has been created in the Anglo-Saxon economic model has not created the culture of caring and commonality that its leftist opponents advocated, instead it has become a subsidy for pathetic wages and corporate profits.

When we refuse to raise wages for years, in spite of inflation and in spite of any economic downturns we are, in effect, docking the pay of those working on minimum wage over time. The market, of course, is not waiting around for wages, the cost of goods has been rising over time while pay has not been. The result of this has been clear to everyone, people were struggling to make ends meet, those on benefits alone especially but also those who are in work but still had to increasingly rely on benefits. The golden answer to this seemed to have been found, though, in the form of the Negative Income Tax. Now, it did not matter what your situation was, the government was going to make sure that you were going to be able to get paid enough to get by no matter what your situation was. If you didn’t make enough money from whatever your employment situation was, you would get a subsidy so that you met this arbitrary figure, if you had no work at all then you would receive a large stipend from the government to meet the same arbitrary figure. And so it was and so all were merry.

There is just one problem though, while employment figures continues to be good, the wage remained the same, as the amount NIT would subsidise you to rose and rose. The result of this was that employers would have to pay less and less of a workers income as time went on and the government would have to pay more and more because obviously businesses, especially multinational corporations with no relation to the individual, are not going to be paying people more money out of the goodness of their heart when their workers can just get welfare to be able to have disposable incomes.

Why have we allowed this situation to develop? Have we somehow come to the conclusion that the richest corporations and people on the planet are incapable of paying their own employees a decent wage as they simply get richer and richer? Why are we having the taxpayer subsidise mega corporations to not pay their workers? It would be easy for us to say that the fault is in just NIT or that its the result of a series of corporatist politicians but the reality is that this is the result of the capitalism system we have created where welfare is an acceptable and somehow for some a desirable outcome. For a person to be, in many cases, alive thanks to welfare is not a successful outcome for Welfarism, it is a failure of Capitalism and that is, in essence, what welfarism is, a failure of capitalism.

I am not suggesting, for a moment, that we should not live in a society where there is not an expansive system in place where the sick, the unemployed or the disabled should not be able to receive welfare but I think that we should stop just looking at welfare as a natural part of the system, the price of doing business, the way things are done. If you are working in this country then you deserve a fair pay, if you work and toil your whole life only to find yourself spending that life on government support then that is a failure in any individual case and as I write today it is endemic. We must give the people of the United Kingdom a fair deal and that means fair pay for fair work, fair taxation for fair causes and fair welfare for fair reasons. No days Labour without just pay and no years taxes to subsidise companies not paying their employees.

Written by CDocwra for the Guardian.

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