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Strange bedfellows

Published by Matthew Davidson on Sat, 26/08/2017 - 4:43pm in

Via MacroBusiness, here's the TL;DR of the Business Council of Australia's submission to a 2012 Senate inquiry into social security allowances:

  • "The rate of the Newstart Allowance for jobseekers no longer meets a reasonable community standard of adequacy and may now be so low as to represent a barrier to employment.
  • "Reforming Newstart should be part of a more comprehensive review to ensure that the interaction between Australia’s welfare and taxation systems provides incentives for people to participate where they can in the workforce, while ensuring that income support is adequate and targeted to those in greatest need.
  • "As well as improving the adequacy of Newstart payments, employment assistance programs must also be reformed to support the successful transition to work of the most disadvantaged jobseekers."

Not only did the BCA's confederacy of Scrooges suffer unaccustomed pangs of sympathy, the Liberal Party senator chairing the inquiry also agreed that Newstart is excessively miserly. However, he failed to recommend raising the allowance, saying:

"There is no doubt the evidence we received was compelling. Nobody want's [sic] to see a circumstance in which a family isn't able to feed its children, no one wants to see that in Australia. But we can't fund these things by running up debt."

Sigh. (Here we go…) There is no need to "fund these things", whether it be by "running up debt" or any other means. The Federal Government creates money when it spends. We, as a country, run out of the capacity to feed our children when we run out of food. We cannot run out of dollars, since we can create the dollars without limit.

The government does however, at the moment, have a purely voluntary policy of matching, dollar-for-dollar, all spending with government bond sales. There's no good reason for this; as Bill Mitchell says, it's just corporate welfare. Even so, selling bonds is not issuing new debt. Bonds are purchased with RBA credits (or "reserves", if you prefer). The purchasing institution simply swaps a non-interest-bearing asset (reserves) at the RBA for an interest-bearing one (bonds), still at the RBA. It's just like transferring some money from a savings account to a higher-interest term deposit account at a commercial bank; do we say that this is a lending operation? Of course not.

There is no fiscal reason why the government should punish the unemployed to the extent that they become an unemployable underclass. Even if we are generous and assume the good senator and his colleagues on the inquiry are just ignorant about how the economy works, we are still bound to conclude that there must be some (not so ignorant) people in government, who do want to see people suffering for no just reason.

Wednesday, 15 February 2017 - 5:22pm

Published by Matthew Davidson on Wed, 15/02/2017 - 5:34pm in

I'm ranting altogether too much over local "journalism", and this comment introduces nothing new to what I've posted many times before, but since the Advocate won't publish it:

Again I have to wonder why drivel produced by the seething hive mind of News Corp is being syndicated by my local newspaper. This opinion comes from somebody who appears to be innumerate (eight taxpayers out of ten doesn't necessarily - or even very likely - equal eight dollars out of every ten) economically illiterate, and empirically wrong.

Tax dollars do not fund welfare, or any other function of the federal government. Currency issuing governments create money when they spend and destroy money when they tax. "Will there be enough money?" is a nonsensical question when applied to the federal government. As Warren Mosler puts it, the government neither has nor does not have money. If you work for a living, it is in your interest that the government provides money for those who otherwise wouldn't have any, because they spend it - and quickly. Income support for the unemployed becomes income for the employed pretty much instantly. Cutting back on welfare payments means cutting back on business revenues.

And the claim that the "problem" of welfare is increasing in scale is just wrong. Last year's Household, Income, and Labour Dynamics in Australia (HILDA) report shows dependence on welfare payments by people of working age declining pretty consistently since the turn of the century. This opinion piece is pure class war propaganda. None of us can conceivably benefit in any way from pushing people into destitution in the moralistic belief that they must somehow deserve it.

Sustainability and the political economy of welfare

Published by Anonymous (not verified) on Thu, 16/06/2016 - 10:00am in

Welfare is commonly understood in socio-economic terms of equity, highlighting distributive issues within growing capitalist economies. In times when the unequal distribution of wealth in the ‘advanced’ capitalist world has returned to levels of the 19th century, the question of whether we can and should ‘afford the rich’ is indeed central. The traditional response of welfare researchers – that issues of inequality can be solved by redistributing the primary incomes of capital and labour within economically growing economies – however, is not only difficult to achieve in an increasingly unfettered global capitalism but is also controversial. While GDP, income growth and rising material standards of living are normally not questioned as political priorities, there is growing evidence that Western production and consumption patterns and the associated welfare standards are not generalizable to the rest of the planet if environmental concerns are to be considered. For that to happen we would indeed need four to five Earths.

Koch sustainability welfare

In an attempt to take planetary boundaries such as climate change, the nitrogen cycle, and biodiversity loss seriously, our new book Sustainability and the Political Economy of Welfare discusses the implications for ‘the’ economy and associated welfare standards. It raises the issue of what would be required to make welfare societies ecologically sustainable. In doing so, we regard the current financial, economic and political crisis and the corresponding recalibrations in Western welfare state institutions as an impetus to also considering environmental concerns. We are furthermore concerned with the main institutional obstacles to the achievement of sustainable welfare and wellbeing (especially the social structures of global finance-driven capitalism), how these could feasibly be overcome, and how researchers can assist policy-makers and activists in promoting synergy between economic, social and environmental policies that are conducive to globally sustainable welfare systems.

These are complex issues that tend to overstretch the terms of reference of single disciplines. My co-editor Oksana Mont and I felt accordingly privileged to have the opportunity to assemble an interdisciplinary team of researchers from five Lund University faculties as well as Kate Soper, Hubert Buch-Hansen and Ian Gough, who wrote the preface, and to work together for eight months at the Pufendorf Institute for Advanced Studies. We subdivided the book into three parts: conceptual issues of sustainable welfare, policies towards the establishment of sustainable welfare and emerging practices of sustainable welfare in countries such as France, the US, Sweden and China.

Our concept of sustainable welfare attempts to integrate the two previously separate disciplines of welfare and sustainability research. Taking environmental limits seriously in welfare theorising means, first of all, to ask whose welfare should be met. Distributive principles underlying existing welfare systems would need to be extended to include ‘non-citizens’, those affected in other countries and future human beings. Hence, sustainable welfare is oriented towards the satisfaction of human needs within ecological limits, from the intergenerational and global perspective. It is only at global level that thresholds for matter and energy throughput as well as for greenhouse gas emissions can be determined in order to effectively mitigate global environmental challenges such as climate change. At the same time, these biophysical conditions and global thresholds delineate the room for manoeuvre within which national and local economies can evolve and within which welfare can be provided. This suggests a new mix of private, state, commons and individual property forms with a much lesser steering role for the market than at present.

Sayer afford the richIn the policy-oriented second part of the book, several authors place emphasis on the detrimental effects of the financial system within the international political economy and highlight various degrowth visions of practical transformation strategies that could frame more specific policy packages. Here, research has a potentially vital role to play but can only do so in close dialogue with diverse societal actors – particularly if it produces insights into the mechanisms, groupings of actors and their institutional embedding as well as into the ways in which governments and governance networks may support voluntary and civic bottom-up initiatives. If sustainable welfare is going to be practiced at all, then it will most likely be in different ways in different countries due to their diverse points of departure in terms of the institutional particulars of market coordination and welfare systems. While research on the potential diversity of future welfare systems is still in its infancy, it is important to explore the opportunities and potentials that exist within current welfare systems since these must be built upon in any move towards sustainable welfare.

Part III of the book argues that a potential opportunity for the establishment of sustainable welfare lies in the diversity of perceptions about the ‘good life’ and the relationship between individuals and governments in initiating transformative processes and legitimizing sustainable lifestyles. People are becoming increasingly disenchanted with the consumer culture due to its growing negative side effects such as time scarcity, high levels of stress, traffic congestion and the increasing displacement of other pleasures of life and wellbeing through the shopping mall culture. We may already find seeds of alternative visions and practices in craft movements, the service economy, socio-ecological enterprises and forms of collaborative consumption. A ‘slower’ life and more free time should not be seen as a threat to the ‘Western way of life’ but as sources of individual and communitarian wellbeing, genuine individual fulfilment and opportunities for greater involvement with various social networks that have the potential of improving social relations and creating trust. This could also facilitate to breaking the link between resource-intensive economic growth and hegemonic perceptions of societal ‘progress’ – and to ending the monopoly of the prevalent consumer culture over alternative definitions of wellbeing and the ‘good life’.

The post Sustainability and the political economy of welfare appeared first on Progress in Political Economy (PPE).

Government Resurrects Four Week Wait for Welfare

Published by Anonymous (not verified) on Wed, 16/09/2015 - 11:07am in

Tags 

Senate, welfare

Prison Awaits Welfare Cheats – Government

Published by Anonymous (not verified) on Mon, 07/09/2015 - 11:37am in

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welfare

Think Carefully Before Importing Kiwi Welfare Model

Published by Anonymous (not verified) on Tue, 10/03/2015 - 10:46am in

NFPs React to McClure Welfare Review

Published by Anonymous (not verified) on Wed, 25/02/2015 - 2:17pm in

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research, welfare

High Rents Boosting Homelessness

Published by Anonymous (not verified) on Thu, 22/01/2015 - 10:45am in

Revised GP Co-Payment Still Bad Policy: ACOSS

Published by Anonymous (not verified) on Thu, 11/12/2014 - 9:20am in