My column in The National this week was about human being's capacity to be inhumane to other human beings.
I used the example of poverty - and destitution - in Scotland to illustrate my point.
I made clear that this destitution is not inevitable. It is what some have chosen to impose on others. We know that. Sources of tax revenue to eliminate that destitution do exist.
Jonathan Pie is on much the same theme here:
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One of the biggest causes on in work poverty is the very high cost of housing. Demand for housing over the last 20 years has greatly exceeded supply, as the population grew by 15 million people, from 52 million to 67 million, ( mostly through inward migration). Government planning for this population growth and the public services required was non-existent. Not enough new homes were built, GPs trained, hospital bed numbers increased etc.
I agree
The increase is little understood
When the population in the UK was around 52m in the 1950s, Harold MacMillan had a housebuilding target of 500,000 new homes per year that he strove hard to achieve. In 2022, the UK population was over 67m, but only 204,000 houses were being built. This is essential, populist neoliberal political policy; to ensure housing scarcity, increase demand and drive up house prices. It is the definition of populist capitalism; domesticated rentier capitalism for fundamentalist risk avoiders. You so not earn it. It just happens. When it happens, you continue to vote for it. That is all there is to it.
The downsides? That is somebody else’s problem. It’s nothing to do with me. I know my property rights.
And that is Britain today.
Yes. I am old enough to remember when Thatcher’s government reversed the postwar social contract and began selling UK’s social housing stock. Called it out then as a shortsighted atrocity. Shocked at how few friends, family or individuals ‘buying’ their state homes could either see the inevitable consequences (societal breakdown) or seemed to care. Short term personal greed is an empathy cancelling drug.
20 years?
From what I can see, it looks like you need to go way back to 1960 (so 63 years ago) to find your 52 million population figure.
20 years ago (in 2003) the UK population was 60 million, so the growth to date is 7 million.
(Still not enough houses though, ofc)
– https://ourworldindata.org/grapher/population-unwpp?tab=chart&country=GBR
– https://www.ons.gov.uk/peoplepopulationandcommunity/populationandmigration/populationestimates/articles/overviewoftheukpopulation/2020
The effect of housing costs on poverty and in-work poverty has to be unpicked very carefully.
It is not just a question of numbers and pricing being a result of scarcity. Consider this from myself who is a housing developer in a local authority:
House pricing is also about the use value of housing and balancing that use – as a good to be consumed (lived in) and as an asset ( a value that can be liquefied (print money) or create liquidity (loans/credit) for more consumption of goods or assets).
With the parlous state of wages, pensions and savings (note the policy failures here feeding into housing supply) housing is now an income stream to many people who become landlords to maintain a standard of living.
With little or no regulation of private rents – deliberately done to increase supply whilst council housing was underinvested in – housing costs have gone up. So more house building in the private sector is not the answer. More house building may not bring down the cost because the value of assets tend to NOT go down as you create more assets, unlike the law of economies of scale of goods where producing more brings down the cost.
So the point with private supply is more to do with policy and regulation – not necessarily numbers. And also policy across other areas – wages, employment, pensions, labour market etc. , which all need looking at in a joined up way and balancing better. Our housing list is also swelled by private tenants being evicted so that the asset (their home) can be sold on for profit by their landlord/owners under tenancies called ‘assured shorthold’ that make it easier to evict and for the landlord to treat the home as a mere disposable asset.
Even in the social sector, we share the same truths. The more I build on a new scheme, the cheaper each unit will be (economies of scale). If I buy a section 106 scheme from a developer at 52% of open market value, again I get the units cheaper – essentially half price (this is a function of planning law, not economies of scale).
But – through government policy – I do not pass those economic savings to the tenant. Instead, I’m made to charge 80% of market rent to the tenant for these units as well even if the buildout/purchase was cheaper. So, even in social housing we are treating our homes to rent as assets to generate income above and over the cost. Profit.
This is because government management and maintenance grants given to councils after government made them build council housing (but left the debt for doing so with each local council!!) have been basically eliminated from local authority social housing. The affordable housing grant and empty homes grant levels for new council housing never seem to be above £50K per property outside of London and in my experience have been a lot less. I think from 2012, council housing revenue accounts (HRAs) are now stand alone and no longer get topped by central government. So landlords like the one I work for need every penny of rent. Our HRA is still reeling from paying for Covid related expenditure for example and also from the Treasury limiting rent rises to 1% or making us put up the interest charges on loans from the HRA for our new homes.
The old cheaper ‘social rent’ or target rent was much lower.
Take a rent of say £200 pw. 80% of that is £160.00. Target rent could be as little as £106.10 pw and you would not pay off a loan for a new scheme within 50 years more like 60 plus. The scheme would be termed as ‘unviable’. The 80% market rent would bring it in decently within 50 years at 4.35%. Again, proof that investment by the state in affordable housing is simply not happening and tenants are paying for their new homes, not the State.
Changes to the consumption side in Universal credit, where the housing portion is being reduced and the bedroom tax increases hardship too as the income side used to pay consumption bills like utilities and food gets channelled into the accommodation costs. Then people start going hungry.
Housing policy can only be described in this country as like a game of snakes and ladders. You’re invited down one path, to find that you are put into another situation that looks like a dead end.
My view on destitution is that it’s all to do with the No.10 nudge policy .
Destitution is just part of the process of nudging us into realising that they don’t want as many people as they did before. Artificial Intelligence will get rid of unions, pay bargaining, pensions, bank holidays, staff rota’s, sick pay, compassionate leave etc., making it easier for the idle rich to sit back and watch the money rolling in.
The politicians have seen Capital’s future and want to make themselves useful and relevant.
They’re done with us, and this is how they are going to do it – by making life unbearable until we get the message.
And that universal basic income we’ve spoken here? Well, for who is left that will be universal credit one day – credit as in debt. They’ll pay you credit to spend into their economy and charge you interest too. Perfect!!
You heard it here first!
The bottom line is that successive UK Governments have not prioritised human need since 1979.
Here’s a good transcript history and explanation about how capital has reasserted its dominance over governments post Second World War:-
https://gpenewsdocs.com/seeking-full-employment-without-falling-prey-to-neoliberal-traps/
Bill Mitchell gave a pretty succinct summary. He could have mentioned how the oil crises of the 1970s and the (unsurprising) inflation that caused, provided the perfect “Overton window”) opportunity to force neoliberal economic policies down the throats of even the communist states.
Fritz Bartel’s very readable book about this period shows how democratic states were easily able to impose neoliberal policies while communist states faltered and collapsed under pressure from the IMF and the sovereign-lending banks to impose austerity (become capital exporters), and turned to democratic methods to force through and legitimise policies to reduce wages, increase unemployment and reduce social spending of all kinds.
Are we really seeing the end of neoliberalism? New Zealand just lurched to the right, with both Labour and National offering slight variations of neoliberal policies; Australia lurched “left” to a Labor party promising little more than continued fiscal rectitude; and the UK may yet usher in a Labour landslide, despite the assurances that fiscal rectitude will reign and so nothing much will change.
https://www.hup.harvard.edu/catalog.php?isbn=9780674976788
I can’t help but think non-politely the term ought to be “fiscal rectumtude” pretty much along the lines of get your finger out and actually start trying to think politicians and voters instead of endlessly regurgitating capital’s favourite memes or themes.
Full marks to Richard for investigating alternative means of raising taxes other than a simple wealth tax. There is lots more to go at including the government subsidies capital gets and of course how do you stop capital calling the shots in a negative way for the many whilst retaining the advantages of free-market capitalism. In other words how do societies get back to greater reverse dominance over those who have little empathy for others.
Here’s a perfect example of the effect of capital’s dominance on the minds of the British:-
https://www.theguardian.com/business/2023/oct/28/taxation-is-not-a-burden-its-brexit-that-weighs-britain-down
Effectively when it comes to understanding how this country’s monetary system works together with much else economically and politically the collective psyche of the British people is that of an old horse that needs to be put out to pasture!
Is there any possibility of a resurrection? I found myself arguing with relatives this weekend over this issue. One relative had just resigned his Labour Party membership over Starmer’s one-sided support for Israel even written to his Labour MP to explain why and got a letter back that she agreed with him and could understand his decision! Another relative said they would vote for Labour on the basis that tactical voting made little sense because the Green Party had shown an inability to win seats and the Liberal Democrats were untrustworthy after Nicholas Clegg’s behaviour in the coalition with the Conservatives. This relative saw the main imperative to be getting rid of the venial and incompetent Conservative government and thought progressive Labour MP’s would form a bloc refusing to vote for any right-wing Starmer policies he tried to push through Parliament. Of course they had no answer to the fact that Conservative and maybe Liberal Democrat MP’s might support these policies to out-number the progressive Labour MP’s. The UK is certainly in trouble because of collective ignorance how things really work!
Good by Bill.
But read what I have just posted too.
I live in social housing. My two eldest live with me, my youngest shares a small house with his girlfriend. We are fortunate among some people we know.
The chances of my children having a comfortable life [even if they do get ‘good’ jobs] are small. The chances of decent affordable housing are smaller still.
Something economic is going to crash in the near future unless someone with compassion gets the reigns of power. And if economics crashes, politics will follow.