If I am honest, I am only just hanging on as a member.
I was desperate for Layla Moran to win the Leadership election. With her modern day articulation of Charles Kennedy’s ‘The Future of Politics’ – the book which persuaded me to join the Party in 2002. She was unsullied by the Coalition years; she was the fresh, engaging face that I wanted (and still want) for the Party.
I went to ground after the Leadership election. Trying to be a good member. Trying not to be too critical of the new Leader. But with months on top of a year’s Acting Leadership having passed by, and still no national profile to speak of, I feel increasingly militant.
Having spent more than 20 years working in frontline mental health social work, I am more than keen for the party to be on the front foot, taking the fight to the Government on the hollowing out of local government and other agencies’ ability to tackle poverty and deprivation. Which is why I was so frustrated to read the article in the Observer at the weekend – a call from Louise Casey and others for a new Beveridge Report; and Ed Davey absolutely nowhere to be found on the issue.
William Beveridge is one of our most famous Liberal forebears; and given the issues that have been brought forward by the pandemic, there is no more important time to claim him as one of our own, with a message that, shockingly, still pertains to post-COVID and post-Brexit Britain.
Which brings me to our Leader’s fixation with his own role and others’ contribution as carers. What could be wrong with that? Surely it’s a good thing for him to be talking about? And yes, I understand the broken-record approach to messaging that is probably important in days when the Party’s airtime is reduced. But there is no point in Ed trying to become the voice of the 10 million carers in this country, if there is no wider strategy being articulated as well.
I have read that he is asking the Government to put in place funding so that carers are able to have a break, given the long hard months of lockdown. Nice idea in principle, but have the practicalities been thought through? Is there the skilled workforce available to pick up the role when carers access this funded time off? If the money is available but the personnel are not, won’t any such initiative go the way of the Nightingale Hospitals, that had to be packed up because they could not be staffed? In my personal experience the home care and residential care sectors are backs against the wall. The staff are exhausted and traumatised. Many are EU nationals who may not be able to stay after the summer…
It is my view that Ed’s determination to pursue this campaign may be more worthwhile if he were to explain to the nation that carers, if given a role in policy-making, can identify the crucial gaps in public services that are imperative to fill and to plan for in a long-term, sustainable way. Carers across a range of needs and age-groups could help the Party develop a clearer narrative about tax and spend, and the provision of what I will call the public services framework for the upholding of basic human rights in this country.
In the same way as groups like ATD Fourth World UK, for whom I have worked in the past, have consistently promoted the need for people with direct experience of poverty in the UK to be part of the policy-making process, the Liberal Democrats could seek to develop and fund a process whereby carers’ knowledge could inform our own policy-making at Conference. Working with other specialist organisations and the technologies that have developed during the pandemic could enable us to be creative and radical in ways that the other parties cannot.
In my opinion, it is no use Ed Davey banging on about carers if people don’t understand why he has tied himself so tightly to this mast. If there is no wider strategy he will look like a one trick pony. People will get bored of him. And frankly, who could blame them?
* Nick Perry is an approved mental health professional and was the parliamentary candidate for Hastings & Rye at the General Election.
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88 Comments
Perhaps the citing of William Beveridge as a great Lberal thinker is a little miss-placed in these historically judgemental times.
‘William Beveridge was a member of the Eugenics Society, which promoted the study of methods to ‘improve’ the human race by controlling reproduction’.
A strength of argument made strong by a personal slant and experiences as a professional too.
Nick, I voted and campaigned for Layla. She ought to be leader after Sir ed and no gerrymandering favoured alternatives currently senior, is acceptable!
Having said this, I think you ought to give a bit more credence to our current leader at least on the subject here. He has a remarkable and touching personal and individual story.
This counts more than any commission. While I do not join my colleague above in fretting over the eugenics views when he was young from Sir William B, the experience of Ed is more poignant than that of the crusty though in many ways admirable peer!
As for eugenics, Churchill, the Webbs, shaw, many once , pre WW2 era, were keen on that appalling view. Sadly, only in the fact that Down syndrome are aborted in the womb, and that we allow this as acceptable, does the view prevail.
It is what separates me from the Left on the abortion issue, though I favour legal abortion, we could learn from European nations, about balance on this.
Nick,
I think the critique is a little harsh. Ed Davey together with other LibDem MPs called for a Universal basic income early in the pandemic and have guided its passage through conference to see it adopted as party policy. What is needed now is concrete proposals for implementation that can be campaigned for and making the case for it to be taken forward by the sitting government.
Many have been surprised at the willingness of the current Conservative government to undertake essential support measures to preserve jobs and businesses to date. Keeping up the pressure for an integrated tax and benefit system that ensures no households can fall into deprivation is a timely and necessary strategy in these most straightened of times for so many.
Well said Lorenzo. It is a bit rich criticising Beveridge for his views on ‘improving the human race by controlling reproduction’ while at the same time supporting the abortion of healthy foetuses on the sole basis of disability.
Cj Williams 22nd Feb ’21 – 11:14pm……Perhaps the citing of William Beveridge as a great Lberal thinker is a little miss-placed in these historically judgemental times. ‘William Beveridge was a member of the Eugenics Society, which promoted the study of methods to ‘improve’ the human race by controlling reproduction’…….
What seems to be forgotten in these ‘historically judgemental times, is the treatment of the ‘disabled’ during that period; at best ignored, at worst regarded as freaks…
I support assisted dying when an acceptable level of ‘quality of life’ is gone so, just perhaps, considering their degrading life prospects, trying to prevent such by abortion or by eugenics was then considered a ‘kinder’ option?
The problem with hindsight is that it uses today’s moral, medical and scientific advances as the only yardstick..
Agree entirely with the points re: the practicality of promising all carers respite, particularly when the legislation around respite would require due process re: consent etc.
Speaking as someone working in the field, this policy would be as helpful as the day I tried to persuade a family that keeping their adult son in day centres largely occupied by older people with dementia was killing his ability to live independently, and was met with the response, ‘you’re lying, you just want to pennypinch budgets, which is appalling local government nonsense when Teresa May was on telly this morning to say she’s giving councils more money for social care than ever before’.
Headline policies with a transactional element for social care and health (you vote us, we give you goodies) are cynical one-shot duds.
Well said Nick. You echo exactly how I feel at present!
There is one name that resonates in this article for me and that is Charles Kennedy. We need a Charles Kennedy right now and I am sorry to say Ed Davey is not that person.
Thanks for the thoughts all!
@CJ The point is a second Beveridge report should be squarely our territory and (seemingly) it is not…
@Lorenzo The thing is (and perhaps I am in a minority here) I don’t like him hawking his losses and difficulties. I find it mawkish and distasteful, however profound the difficulties. I prefer the Gordon Brown approach.
@Joseph For sure UBI is important but it will be extremely complex to deliver; reinforces a mistake that poverty is just about adequate income (which it isn’t); and anyway Conference was months ago, what has happened since?!
@Lin Thanks x
@Matt Thanks for these added points, which are well made. There is also the reality that many people who are bona fide carers don’t see themselves as such…
@Ian ❤ RIP Charles Kennedy.
@Nick – the last comment about Charles Kennedy is really interesting.
I liked Charles Kennedy too. He was a very human and relatable character. It’s hard to accept perhaps, but there was little touch of ‘Boris’ about him in the way that he did not take himself entirely seriously. He obviously cared about others without having to formalise it into a policy.
I think that the majority of commentators here were most at their ease during his leadership. He was a Social Democrat, liberal in the sense he was socially tolerant. For a about a decade the LDs could plausibly position themselves to left of Labour on many issues, and claim significant representation in Parliament without having make any hard choices. Unsurprisingly, he was strongly against the coalition.
The problem with all this is simple. There is no space to the left of Labour and there isn’t going to be any until they get back into government. Even then we will find it very hard going to compete with the Greens/Plaid/SNP.
Out of curiosity, if you left the LDs where are you thinking of moving over to (or perhaps just leaving politics)?
@James If you haven’t read ‘The Future of Politics’ then I suggest you do – it is a very credible and still relevant exposition of joined up liberal, internationalist and environmentalist thinking. Your question about leaving is a hypothetical one, and you know what we are advised to do with those 😊 But for transparency’s sake, I don’t really see another home to go to. The Party would have just lost another grafter. Another one of many who have felt the need to retire themselves.
@ Nick Perry “But there is no point in Ed trying to become the voice of the 10 million carers in this country, if there is no wider strategy being articulated as well”.
Bulls Eye, Nick.
And, why did the FCC (with its unrepresentative bias towards the prosperous South East of England) blow the opportunity for it to be discussed by discarding a motion put forward by Katharine Pindar and Michael BG for a Beveridge Mark 2 ? I just hope someone can resurrect it as an emergency motion given we are enduring the biggest civil emergency in my lifetime since WW2 and Beveridge 1.
A brief visit to a Stockport chippy is no substitute for properly worked out proposals
duly vetted by the I.F.S.
Nick,
this is the pre-budget messaging from Ed and colleagues:
Chancellor must act next week to prevent lost generation with a Big, bold innovative plan that will help them get their lives, and their family’s future, back on course. Business needs certainty, long term planning and a clear vision of how we are going to repair and rebuild our ailing economy.
You reference Louise Casey in your article. Her message is a simple one. If the will is there these problems of homelessness and destitution can be solved.I admire her no nonsense can do approach.
Channel 4 Dispatches aired a report last night https://tvnews.bradfordzone.co.uk/2021/02/22/britains-400bn-covid-bill-who-will-pay-channel-four-dispatches/ As always, Alistair Darling was the voice of reason and common sense.
“You can’t level up on the cheap. You’re kidding yourself if you think you can. Yes, it does need expenditure. But that sort of expenditure where you are rejuvenating the country and you get your tax back because people are going into work, they’re paying taxes, they’re earning higher wages and so on. It’s a long-term commitment and yes, it involves expenditure, but you can justify that expenditure. It can be done. That’s the point. We’re going to have to pay for this, there are going to be consequences of this pandemic, make no mistake about that.”
UBI is not complex to deliver – it just needs the kind of determination that Louise Casey exemplifies.. Poverty may not bejust about adequate income, but that is the priority for households living in destitution.
“The number of households “living in destitution” across the UK is estimated to have more than doubled during 2020, from 197,400 to 421,500. That is an increase of over 220,000 households and represents well over half a million people. Destitution is defined as serious poverty – two adult households living on less than 100 pounds a week, or 70 pounds for-single adult households.”
UBI can be introduced overnight from 6 April 2021. Here is how:
1. Adopt the recommendation of the office of tax simplification to merge basic rate tax and NI into a combined rate of 32% and apply to all sources of income including rental and investment income and capital gains and corporation tax with a dividend credit for corporation tax paid.
2. Replace the personal allowance and NI threshold with a UBI for all adults equivalent to the current rate of Universal credit basic allowance for over 25’s (£409.89 per month). Immediately boosts incomes of those on legacy benefits by £20 per week.
3. Introduce a Proportional property tax, payable by landowners not tenants, to replace council tax.
4. For business, introduce a commercial landowner levy paid by landowners to replace business rates paid by tenants and pursue the industrial strategy developed by Vince Cable in Coalition (what is now called levelling-up).
5. Introduce a direct jobs guarantee as part of the Green New Deal and commitment to addressing climate change without which there will be no economy to sustain.
@James Fowler: If by “space to the left of Labour” you mean the ideological left, then that is not space that the Lib Dems has ever occupied nor would ever wish to occupy. Lib Dem MPs may from time to time have found themselves in the same voting lobby as Corbyn & co under Blair and Brown, but this did not indicate any meeting of minds on any level beyond those specific issues, and the Tories never succeeded in portraying us as spiritual heirs to Militant, much as they tried. We still won seats from the Tories in that era.
“As always, Alistair Darling was the voice of reason and common sense.” ???
(On Channel 4’s “The Covid Bill who will pay?)
This is only seems to be true if you erroneously apply a household model of economics to a currency issuing government. No doubt Alistair would tell me in no uncertain terms that he knows that the Government isn’t a household but, like most neoliberals, he will be quite reluctant to explain the point to a wider audience who tend to think very much in those terms.
He was actually rolled out to say ‘we will have to pay for this one day’ but any sensible explanation was lacking. We might well have borrowed the money from the Martians as far as he was concerned.
The title of the program would have been very much to the approval of the presenter, a hard right neoliberal, Liam Halligan. He’s trying to sell the message that we’ll all have to pay extra taxes one day to “cover the bill”. In actual fact the Government has done what Governments always do during a National crisis, like a war. They have simply created lots of extra spending money for themselves. Or some would say the Government has borrowed the money from the Bank of England which is essentially the same thing, as the Govt itself owns the Bank.
It’s like moving money from one trouser pocket to another. The correct answer to the question is that no-one is going to have to repay anything but there is a possibility ( no more than this) that the extra spending by Government will have transferred itself to extra spending potential in the general public. Therefore there could be a future overheating problem in the economy to deal with. But that there is no point switching on the cooling system, ie applying higher taxes, until we actually do see some sign of the overheating start to occur.
Peter Martin.
Liam Halligan published a well researched book on the Housing crisis ‘Home Truths’ in 2018. It was serialised on Unherd. These six graphs are a useful representation of this key issue https://unherddev.wpengine.com/2018/04/home-truths-part-i-uk-housing-crisis-six-graphs/?=refinnar
Alistair Darling as a former Chancellor knows well the workings of the treasury and the public finances. In particular, how susceptible they are to global shocks, inflationary pressures and the potential for rising interest rates in the USA and other developed economies.
In fiscal terms, UBI moves a part of spending power from higher incomes (where there is a greater propensity to save, particularly at present) to lower incomes where there is a greater propensity to consume). It is primarily an income redistribution policy and does not require the levying of higher proportion of taxation as a % of GDP as the income distributions and tax increases on higher incomes net out.
Where there is greater spending required is in government investment in infrastructure (as the Mayor of Tees Side commented last night) to draw in private capital to the regions for commercial enterprises to develop and expand. This is properly funded by borrowing, as Alistair Darling points out. The costs of the borrowing are funded by the increased tax revenues derived by the increased employment that the investment generates and are premised on being able to sustain a rate of economic growth in excess of the cost of raising capital.
In both cases, there is no requirement for higher levels of taxation in the economy at least until an economic recovery is well established. Inflationary pressures, should they arise, can be addressed with either reversal of quantitative easing and/or normalisation of interest rates.
Apologies in advance for repeating myself, feel free to skip this if you have read me before.
Both the article & nearly all the comments assume that we know how The Libdems are doing now but I dont think we do. We have been steady in the Polls around 7% since last Summer, the period of what I call the “Covid Trance”. Politics is in Lockdown; the only “Issue” is Covid, Only Parties in Government can do anything about Covid. Even acknowledged Opposition Parties get only crumbs of publicity; “Other” Parties (like Us) get nothing.
We have no idea of what, if anything, is happening in Politics, Polls are useless. We just dont know how well Ed or the rest of The Party is doing.
We may know more on May 7th, Polls may return to telling us something in the Autumn but we cant be sure of that either.
Lets just forget how we “feel” things are going & just campaign as if it mattered.
@ Joe Bourke,
Please spare me the “Argument from Authority” on economics. If the “great and the good” were so really so great and so good, why do we always have one set of problems after another? Why did we have the 2008 GFC? Why is the eurozone in such a mess?
Going back to the OP, which wasn’t about a LVT or UBI, BTW, the comment “it is no use Ed Davey banging on about carers” is perfectly true if there’s nothing else to go with it. It should be a part of a wider policy. Katharine Pindar and Micheal BG are on a better track, if not the right track, with their call for a Beveridge 2. Except I’m not a all sure it bears much resemblance to Beveridge 1. It would be better if it did and there were far more emphasis on the concept of full employment with jobs for all at a living and fair wage.
@ Peter Martin “No doubt Alistair would tell me in no uncertain terms…..” On chatting terms with Lord Darling are you, Mr Martin ?
@ Paul Barker “Apologies in advance for repeating myself, feel free to skip this if you have read me before.”
No problem, Mr Barker, though I’ve read you extolling the virtues of flying the flag many times before. In your calculations have you considered how many constituency organisations have collapsed since the last general election and won’t be campaigning next time ? I know of at least one where there was a full time agent just ten years ago but is now in a state of suspended animation – or trance as you put it.
Peter Martin,
Alistair Darling is the voice of someone who has actually had the experience of and responsibility for dealing with a financial crisis and who has taken the time to write a well received book recording his reasoning and actions for posterity https://www.theguardian.com/books/2011/sep/07/alistair-darling-back-from-brink-review As such he has been able to retain that all important attribute in politics and economics – credibility with both the public and the business community.
UBI has been adopted as Libdem Policy. The motion passed at conference calls for:
– Liberal Democrats to campaign for a Universal Basic Income, paid to all long-term UK residents.
– This income to be funded in a socially just and equitable manner to create a fairer social security system for all.
– This income to be implemented based on the best available international evidence, rolled out in a phased manner to ensure the reliability and effectiveness of the system.
– This income to be streamlined and integrated with other necessary income support mechanisms including pensions and student living cost support.
– The Federal Policy Committee to work further on the details of the implementation.
– Liberal Democrats to continue to campaign for strong and accessible targeted income support mechanisms, including but not limited to effective housing and disability support payments.
Supporting carers needs to be the key policy supported by a more comprehensive package. Why just carers, the electorate might think? Also carers are such a broad group that we can all think of people who while performing caring duties do not really want or especially deserve extra help. This tends to reduce the emotional impact of the message.
@David Thanks, I hope so too (about Beveridge 2)
@Alex Exactly! As well as which, the Party just can’t afford to fritter away members like me, and there are thousands, who have continued to campaign in very difficult terrain because we have simply believed
@Paul Fine. But what you are missing is that I (and Lin, and there will be others, as David testifies) feel like this right now. And in practice that means we won’t be campaigning like we once did. It is the Leader’s job to inspire when there is little else to keep you going. I don’t need polls to tell me Ed is failing on that.
@Joe I am with Peter Martin on the economics. And there *needs to be a narrative*. Please know that I have done my level best to be restrained and diplomatic about the lack of one. I can be a lot worse! 😊
A good article. Our focus on carers feels very much like policy in a vacuum. There’s a lack of detail, explanation or overarching narrative vision for many of the things we’re saying – on carers and generally. I’ve been looking at our twitter feed and it’s largely just images of the words ‘carers’ or ‘human rights’ or ‘coronavirus’ in big letters with little to emotionally resonate or make you think ‘these Lib Dems are worth listening to’, rather tha just ‘oh well that’s nice’. I also wish Ed would stop listening to whoever is coaching him for public speaking – he’s not a natural public speaker so it’s better he doesn’t try to be – his decency will come across better.
I am slightly concerned that Beveridge 2 is becoming more about (to coin an old phase) “a better yesterday” rather than thinking about today’s economic problems. Even Beveridge in the 1940s wasn’t happy with Labour’s centralised and top-down approach to welfare and the NHS so I’m not sure why those sorts of solutions are popular in the Lib Dems today.
Liberals need to focus on creating opportunities for all in an enterprising economy. That is the only way to tackle the underlying causes of poverty and dependency. Raising the standards in education, freeing access to higher and further education and giving people tradeable skills is crucial. For example, many young people leave school without a basic understanding of how to set up or run a small business – yet we know SMEs are a core part of our economy.
On the “lack of vision” issue, we have to remember leaders come and go – some more quickly than others! So stick around…
Nick,
personally, I don’t feel relying on a new *narrative* is going to do much more for Ed Davey than it has done for Keir Starmer. I am with Louise Casey when she writes “If 25% of your population is affected, then you can’t just tweak old policies, working out the least expensive, least challenging thing that can be done. You need big new policies.” Those big new policies are UBI and investment in the so called Green New Deal.
She goes on “It’s about action, not solutions. Food banks, free school meals: they’re all action. But are they solving hunger? No. It’s like me [when] My GP said to me: Louise, I can give you prescriptions for this and that, but at some point, you need to work out how you are going to stop needing those prescriptions. You need to lose weight.”
Increasing the monetary base is a necessary but temporary expedient not a longer term solution. As Liam Halligan has written “…since 2009, ultra-low interest rates related to quantitative easing – resulting in negative real returns on government bonds – have pushed yet more speculative money into property.”
Public and private investment that directs investment to sustainable enterprises and jobs is concrete action that develops a long-term solution.
Every asset is either a real asset or a financial instrument. Real assets derive their value from their physical properties. Financial instruments derive their value from their contractual properties. (Financial instruments have value to their holder because they represent a liability to another party). Money only has value because it is a financial instrument. More specifically, fiat money represents a proportional claim on the future output of society.
Money can be likened to a long-duration, special-form equity instrument issued by society and represents a proportional claim on the future output of society. A characteristic that fiat money shares with traditional equity is that its value is highly dependent upon long-term expectations. More specifically, the long-duration nature of fiat money means that its market value depends upon 20-30 year expectations of key economic variables such as real output and the monetary base.
The purchasing power of money will fall if expectations for long-term output growth fall or if expectations for long-term monetary base growth rise. If the finances of a society begin to deteriorate and both of these expectations begin to manifest, the market value of money falls and the price level rises unless it is countered with debt monetisation that inflates property and equity prices. To prevent the outcome that Japan has experienced over the past three decades (stagnant wage and economic growth, exponential rise in temporary low paid jobs for school leavers) an industrial strategy that can deliver real economic growth and high value work is required.
Any party that cannot deliver improving living standards cannot expect to be given the task of governing by an economically literate electorate. Therein lies the narrative and actions that need to be delivered.
@Joe The solutions that you refer to, particularly if they are going to benefit the poorest, will need cross-class buy-in. That is why a compelling explanation counts.
You are no doubt right, Nick, that these LibDem policies need cross-class buy-in. But a lot of people have been talking about a post-pandemic settlement that addresses some of these long-standing societal needs. Louise Casey in her Observer interview comments:
“…the pandemic gave clarity to the problem. It took all the faffing out of it. From the right-on-osphere on one side [the liberal left is nervous of being seen to “round up” rough sleepers] to the I-don’t-want-to-spend-money-on-the-feckless on the other. We just got on with it. We approached it from a public health perspective – the homeless could have been super-spreaders, especially those in communal night shelters – and that was liberating.”
“It’s this kind of clarity that the government, she believes, needs to hang on to as talk of what the post-pandemic world might look like begins. “This is the moment,” she says. “The thing I feel – and this is the first time I’ve talked about it, even among friends – is that we have to grasp it. Are we ever going to create a Britain that’s for everyone? And if not now, then when? We’ve shown we don’t have to have rough sleepers, which means that we could now decide as a country that this is it. That we will not have rough sleepers ever again.”
“… it should be equally possible to decide that no one will be hungry either, and that old people should be able to look forward to safe care at the end of their lives. We can do some really clever, different things. The pandemic has changed attitudes. Polling shows that 74% of people are OK with the tiny uplift [£20] in universal credit. They want it to continue.”
It is equally not an issues that divides North and South. London has the highest levels of unemployment in the UK and the greatest numbers in deprivation. As a resident of Hastings you will know better than anyone that for those in the bottom income decile, things are not that much better than when Robert Noonan wrote “The Ragged-Trousered Philanthropists in 1914.”
Nick Perry is on the right track .Liberal Democrats crave the big challenge . We expect our leaders to be big hitters . We our right to praise our own heroes like Charles Kennedy , Paddy Ashdown , Shirley Wiiliams and Roy Jenkins all of whom lifted our politics to a higher level . A Beverage 2 report is not a return to the past but a challenge for new future where we value people like carers , where we have a viable social care policy and we count people in to our society and not hang on to a conservative deserving poor mentality that thinks voucher to food bank is good social policy .
I believe if YOU are/were a career you’d understand exactly what Ed Davey is talking about. If you are not then you are in no position to judge in MHO. Otherwise Layla is still around, appeared on Question Time last week, and then what?
For those who are not clear what Katharine and I want the Beveridge-2 Plan or Revitalisation Plan to achieve, let me reiterate it. We want a plan to build a liberal Britain where no-one lives in poverty, where no-one is held back because of health issues, where everyone who wants a home of their own has one, where everyone has access to the education and training they need to obtain employment suitable to them, and where everyone who wants a job has one with fair pay, and where society is taking the action required to deal with the climate change emergency.
James Moore,
The issues that have to be fixed are:
14 million British people living in poverty;
Inadequate health and social care provision;
Homelessness and insufficient supply of social housing;
Inadequate education and training;
Unemployment and underemployment;
The climate change emergency.
Joe Bourke,
Please can you post an internet reference for where you found Ed Davey’s pre-budget message?
Peter Martin,
I also thought the Channel 4 programme, “The Covid Bill who will pay?” was a little odd. I agree with you as lots of the government spending is being financed by the creation of money there is no need to pay the Bank of England back. I also thought it was odd that Alistair Darling said the increased government spending had to be paid for. It doesn’t. I don’t consider growing the economy so the National Debt to GDP ratio falls as paying back the massive current government spending.
Our Beveridge-2 plan or Revitalisation Plan includes a desire for full employment and we like the idea of a voluntary job guarantee. (Are you aware that there is a motion on the agenda for our spring conference – “Lifting Barriers to Work for Disabled People” which calls for “a Jobs Guarantee for newly unemployed disabled people”?)
The idea for the Beveridge-2 Plan was inspired by Philip Alston’s report on poverty and human rights in the UK in November 2018 where he wrote, that the “Key elements of the post-war Beveridge social contract are being overturned.” As Beveridge wanted to end the five evils of Want, Disease, Squalor, Ignorance and Idleness we decided that we could call for the ending of five modern social ills. The building of a new social contract which deals with these modern ills is the parallel we make with Beveridge.
@ Joe,
“Alistair Darling is the voice of someone who has actually had the experience of and responsibility…..”
We might have had our own experience of a car crash too if we didn’t know what the controls do and so aren’t up to the job. It’s not too difficult to find this sort of nonsense from the ‘Baron Darling of Roulanish’: “Cutting Deeper than Margaret Thatcher”, “repair black hole in finances”, “returning the budget to surplus” and all the other neo-liberal claptrap which caused the economy to skid off the road in the first place. It’s a pity he didn’t have some driving lessons with Stephanie Kelton.
She’d have put him straight. Its just about impossible for a net importing country like the UK to have a balanced government budget except on a very occasional basis. Money leaves the country to pay for the imports and it has to be replenished from somewhere otherwise the economy slumps. It’s really not that hard to understand.
https://www.theguardian.com/politics/2010/mar/25/alistair-darling-cut-deeper-margaret-thatcher
Peter Martin,
Alistair Darling has never (to my knowledge) suggested that a balanced budget is an aim. Quite the opposite. He has argued for a Keynesian approach to both the 2008 crisis and this Pandemic and a gradual reduction in the deficit overtime to maintain debt sustainability just as the IFS has. That is exactly the LibDem position and indeed any economist with half a brain, including I think most post-Keynesian economists like Jonathan Portes or Simon Wren-Lewis.
Margaret Thatcher didn’t cut public spending overall, unemployment benefits meant it rose during her term of office https://www.newstatesman.com/politics/2013/04/how-public-spending-rose-under-thatcher.
The current level of deficit will be reduced by holding increases in current day to day government spending relatively flat i.e. below the level of economic growth (just as occurred after the 2008 financial crisis). Spending on health may increase and there may be a temporary spike in unemployment benefits. The stimulus spending will come from both automatic stabilisers and crucially investment spending aimed at meeting zero carbon targets.
Ed Davey in this CNBC interview on Monday https://www.cnbc.com/video/2021/02/22/a-fourth-lockdown-in-the-uk-would-be-a-disaster-ed-davey-says.html has argued that the problem of UK debt sustainability as identified by the IFS can be addressed by the LibDem Green Investment plans to spur economic growth i.e. post-pandemic recovery first and deficit reduction/fiscal consolidation later.
This is what sound economic management is about – investment, jobs, productivity, controlling inflation, stable financial markets and levels of taxation. It requires the maintenance of an economic environment in which people can create businesses; get work and buy homes as they start families. People also need to be able to save for their retirement through auto-enrollment in the knowledge that the value of their savings and state pension and/or benefit payments will not be inflated away and still be enough to keep them out of poverty when they retire.
Joseph Bourke 24th Feb ’21 – 12:13pm
Alistair Darling has never (to my knowledge) suggested that a balanced budget is an aim. Quite the opposite. He has argued for a Keynesian approach to both the 2008 crisis and this Pandemic and a gradual reduction in the deficit overtime to maintain debt sustainability…
‘Alistair Darling: we will cut deeper than Margaret Thatcher’ [March 2010]:
https://www.theguardian.com/politics/2010/mar/25/alistair-darling-cut-deeper-margaret-thatcher
To be fair, he didn’t have a choice at the time as the EU had put the UK into Excessive Deficit Procedure…
‘2008/713/EC: Council Decision of 8 July 2008 on the existence of an excessive deficit in the United Kingdom’:
https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32008D0713
‘2009/409/EC: Council Decision of 27 April 2009 establishing, in accordance with Article 104(8) of the Treaty, whether effective action has been taken by the United Kingdom in response to the Council Recommendation of 8 July 2008 pursuant to Article 104(7)’:
https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX:32009D0409
Today we are free of such impositions. As a sovereign country we can now choose to reduce the deficit gradually overtime as Alistair Darling may well have preferred to do.
Nick, you will be glad to know that the campaign for a Beveridge-2 Plan, an overarching Plan that covers all the areas of social injustice, is far from dead. I and Michael BG, who has explained it again in his 3.08 am comment above, are asking supporters to write to Ed Davey urging him to take up the proposals and at Spring Conference launch the Liberal Democrat effort for a new National Renewal or Revitalisation Plan in his Conference speech. This Plan must encompass the Beveridge-2 Plan in all its breadth. It must cover much more than UBI and ‘green’ jobs.
We asked in our motion for Conference which was not selected for a Commission to be established to work out the Plan, and have noted with interest the wish of Louise Casey for a Royal Commission. Practically and of the moment, we are asking Ed Davey to urge the Policy Committee to establish a powerful Working Group to begin immediate work on the Plan. It should bring together our existing and evolving policies, including of course those on taxation and economic reform, welfare reform, jobs and business development, health and social care proposals, and policies on fairer educational opportunities and better housing provision. Work should continue with presentations to Conference and motions for further development, but meantime we should proclaim to the notion that the Liberal Democrats are back in the game, seeking and finding solutions for our country’s immense ills, post Covid and post Brexit and facing all the necessities of Climate Change.
Incidentally, it’s interesting that while Sir Keir Starmer was trying to seize the mantle of Beveridge from us, talking about the ills of the Tory government in the last ten years as we do and the need for a renewal on the scale of that inspired by Sir William Beveridge after the Second World War, he carefully didn’t mention the present lamentable increase in the national trauma being caused by Brexit. As chief opponents of Brexit, we can gain the nation’s attention also on that front. Sadly, the obstruction of business by the new costs and exhaustive paperwork required for export and input of goods will probably put up prices of foodstuffs and inevitably then lead to increased poverty. Elimination of deprivation and reduction of all poverty for our citizens must surely be our most urgent task, the first objective of the great Plan we must build.
Jeff,
I would say that the Alistair Darling plan to reduce the deficit over two parliaments (ten years) was a plan to reduce the deficit gradually overtime and was ultimately what transpired through a combination of real growth, inflation, tax increases and spending restraint.
The key to the pace of deficit reduction and financial stability is the ability to grow the productive capacity of the economy. Is the UK going to be a productive enough economy to produce all the goods and services that both seniors and the current working population want and need?’ If that can be delivered via a Green investment program that delivers sufficient productivity improvements within the environmental constraints we face, then commitments to retirees and benefit claimants can be met. The risk is, if we are not a productive enough economy going forward, then all we end up with is more intense competition for a dwindling pool of real goods and services as the population ages and workforce contracts, and hence, an ongoing inflation problem.
The narrative should be about which political party has a better plan to increase the probability that in 5, 10, 20 years, we are a productive enough economy to allow seniors to have a sustained standard of living in retirement and to raise living standards for working people going forward. The debate is about the best economic platform to get us there.
@ Joe,
It’s a simple matter of accounting that the external deficit in trade has to be matched penny for penny by the amount borrowed by everyone in the UK.
So if the Government doesn’t care about the trade imbalance, which it hasn’t done for decades now, and it wants to have less borrowing on its own books, it has to encourage everyone else to borrow more. This is why interest rates were reduced sharply after the GFS from around 5% to close to 0%.
Cutting govt spending makes little difference. If governments do this they cut their own revenue too. Neither does raising taxes. This also slows the economy and also reduces govt revenue. This is what Alistair Darling and anyone with your “half a brain” should have been saying. Though personally I would prefer economists not to have experienced any form of lobotomy. Many seem to struggle with the simplest of concepts even so.
If we look back we find that Alistair Darling was “overruled by Gordon Brown when the Chancellor demanded stronger action in the pre-Budget report to tackle the deficit”
Except he wouldn’t, as just explained, have been doing that at all. He was mistakenly wanting to apply a counter inflation policy instead of a government debt reduction policy. That was only possible by reducing interest rates if EU and other international rules on trade tariffs and currency manipulation were to be respected.
Katharine,
As I probably have said before the difficulty of a term like Beveridge 2 is that no-one really knows what it means. No one has written out a complete version yet. Beveridge1 consisted of thousands of other words besides “want, disease, idleness, squalor and ignorance”. So we could read it in full and form an opinion.
The other obvious problem is wanting to add Brexit into the mix. Europe, or the rest of the world, didn’t come into Beveridge1 so why complicate the future Beveridge2 ?
I don’t agree with Keir Starmer on lots of things but he’s right about wanting to put Brexit on the back burner. You must know from your own experience of living near Workington, that the Northern working classes aren’t keen on the Tories but they didn’t like being in the EU either. The Labour Party aren’t going to win them back by keeping harping on about Brexit. Most voters have had enough with the debate and want to do the best we can with what we have.
Peter Martin,
economics is not accounting. Modern accounting developed from the principles of double-entry bookkeeping. Economics is the science that studies how people and societies make decisions that allow them to get the most out of our limited resources.
Modern money in the form of bank deposits and currency is created by banks and the state. This money represents a proportional claim on the future output of society. That is why we say money is debt and why it is total debt (public and private) that matters not one or the other. Money only has value relative to the output (goods and services) it can be exchanged for. The value of money at any point in time is determined by the productive capacity of the economy issuing the money and the relative price in money terms of the factors of production.
Money retains its value when the resources of an economy – land, labour and capital – are productively employed. The purchasing power of money will fall if expectations for long-term output growth fall or if expectations for long-term monetary base growth rise. If the finances of a society begin to deteriorate and both of these expectations begin to manifest, the market value of money falls and the price level rises as a consequence – that is inflation.
This is basic economics and why we can describe economics as the branch of knowledge concerned with the production, consumption, and transfer of wealth, whereas accounting concerns itself with the recording of financial transactions and financial reporting. It is a mistake to confuse accounting/bookkeeping with wealth creation. A house that was worth £5,000 50 years ago and £1 million today still has the same utility to the homeowner and can be constructed with many less man hours than 50 years ago. The only thing that has changed quantitatively is what we use to measure its value i.e the value or purchasing power of money.
Many commenters on LDV have been asking for the party to develop a distinctive position post Brexit. Most voters knew that we were anti-Brexit but wouldn’t have a clue about the detail, even though we had carefully built up a policy base behind it.
The only way to cut through now is by choosing a topic that speaks to the heart as well as the mind, and by repeating it over and over again. By becoming the face of carers we are demonstrating our concern and support for the vulnerable across society. Behind that we should, of course, build strategy and policy but they are not what convinces most people.
Mary, I agree that we all have been longing for a distinctive position. I’m sure few people anticipated it being dictated entirely by the leader’s personal experience and personality, with minimal consultation, and being based largely on transactional policies which seem to ape the errors of the free-school-meals mistake — the idea you can ‘buy’ voters, policy by policy.
Ed Davey has demonstated his desire to create eye catching policies that speak to informal carers. The party has not – yet – become the ‘face of ‘ carers, or the voice. And none of the policies articulated or flirted with so far have an analysis of why carers are getting a bad deal, at a structural level, apart from the vague idea not enough money has been thrown at them, and there is no analysis of the possibility that sometimes the needs of carers and those they care for do not dovetail perfectly and are not synonymous (this is not to say they are not legitimate needs!).
This is some of the least nuanced policy making around social care I have ever seen, and that includes Teresa May’s ‘death tax’. Norman Lamb – and I am not a Norman Lamb fan – and Paul Burstow could both do better and had a better analysis of the overall situation.
@ Joe,
The demarcation between economics and accountancy is really quite inconsequential. What difference does it make if economists dip into a some accountancy theory from time to time? If economists want their discipline to be counted as a science then they should do whatever it takes to get the right answer. Do whatever works and don’t worry about straying into someone else’s domain. Clearly when theories don’t work they need to be discarded or modified so they do.
Obviously there is more to economics than just money. But it is neoliberal economists, like yourself and Alistair Darling, who fret about Government deficits a lot more than they should. If there is any fretting it should be about wasted resources which, as you say, is not the same thing as wasted money.
@Matt Quite right (and interestingly no-one has addressed my suggestion in the piece about tapping carer insights into public service development…)
@Katharine Many thanks for the update. My worry, if I am honest, is that he doesn’t get it, and isn’t listening.
Peter Martin,
it is not deficits that are a concern. It is the lack of a coherent economic plan for improving living standards beyond the immediate recovery stage. If the model is to copy what Japan has done for the past three decades than Albert Einsteins definition of insanity comes to mind.
In this new topsy- turvy world we have entered, the Conservative government is reportedly considering significant increases in Corporation tax while the Labour party is set to oppose them https://www.theguardian.com/uk-news/2021/feb/24/keir-starmer-corporation-tax-rise-labour-budget.
Labour appear to be oblivious to the fact that Companies that are struggling and have accumulated losses will not be paying Corporation regardless of what the rate is, while companies that have done very well during the Pandemic have accumulated substantial cash piles and can likely take such increases in their stride https://www.economist.com/britain/2021/02/13/british-business-is-in-surprisingly-good-shape
“The Liberal Democrats could seek to develop and fund a process whereas carers’ knowledge could inform our own policy-making at Conference”, you suggested in your article, Nick, and I had just come back to thinking about that when I read Matt’s and your latest comments.
I am wondering if we could therefore suggest that the Working Group needed to develop the Plan which we are recommending to Ed Davey could make part of its remit consultations with focus groups of specialists on each Liberal Democrat policy – extant, developing or to come – that relates to a particular area of the Beveridge spectrum. So, Nick, if you were on the section of the Working Group concerned with social care, could you call together a focus group of carers to consult, and, possibly, Matt, you might arrange another of mental health nurses? Should we think of such focus groups being particularly called for in areas when we don’t yet have an adequate policy to offer?
Thank you, Nick, for raising the question. We might get Ed Davey interested if we can flesh out the idea of policy development ON caring, produced partly by consulting carers in a focus group. What do you think? And Matt (Bristol) likewise?
Joseph Bourke,
Economics is not a science, it is a social science.
When you think about businesses making a loss, how many years do you think such businesses can carry on making a loss before they make a profit and have to pay the increased corporation tax? Do businesses have to make a profit to enable them to pay back those who financed their losses?
The Economist article points out that times are tough for non-large firms, with many with no reserves. The article concludes with “there are large clusters of firms that will need more support if a sharp rise in unemployment is to be avoided as government schemes wind down”.
Mary Reid,
A better deal for carers could be part of a policy to do what the preamble implies we want to do – ensure no-one is living in poverty.
@ Joe,
Firstly: Einstein didn’t make the oft quoted pronouncement on repetition and insanity. You might like to check that on Snopes.
Secondly: A discussion on the state of the Japanese economy will require its own thread. LDV aren’t accepting anything from me so if you want to have a go I’ll add my tuppence worth in the comments.
Thirdly: I’m no big fan of Keir Starmer. I agree there is a good case for higher taxes for those who have accumulated piles of cash during the Pandemic. Not because we need the spending money but because there is a need to reduce inequality in society.
Fourthly: I’m all for coherent economic planning. That’s been sadly lacking for the last few decades. Governments of all parties have concentrated on encouraging everyone else to borrow as much as they can but, at least until recently with the Covid emergency, want to borrow as little as possible themselves. It’s a vice they’ve sought to make into a virtue.
Katharine, that sounds wonderful. But I want to be clear that whilst it is always good to be developing relationships with groups of professionals, what I am driving at in the article is engaging with organisations that can provide support to carers or others with direct experience of social exclusion, so that they can be paid by us to bring their experience to bear on our developing ideas for change – to show us how they might work, or not (or be improved). Of course it is important to guard against tokenism, but this is the kind of overhaul of our policy-making culture that I think the effects of the pandemic can bring to bear, if we are determined.
How about using the concept of the Job Guarantee to help out carers by paying them to do what they are doing already? There would have to be some assessment of need but in principle that could be done. The greater the need the more paid hours that would be allocated to the carer.
Katharine, the irony here is that the professional body directly representing the sector of social care that I currently work in — the Technology Enabled Care Standards Association — which has direct insights to bring to integrating housing, healthcare, local authorities and supporting the experience of informal carers in the home setting — is headed by a Lib Dem former MP and minister, the aforementioned Paul Burstow. Talk to him, not necessarily me.
I am not currently a member of the Lib Dems for various reasons, but the party has access to both grassroots and top-level access expertise in these areas, yet seems to not want to engage with the messiness of detailed decision making and structural analysis, in favour of policy-making-by-press release.
@Katharine, I guess the challenge for us is the possibility of creating a Liberal Democrat-applicable version of something like this:
https://www.scie.org.uk/publications/guides/guide04/mf/11-3.asp
What Nick just said, with further underlying structural / governance issues re: local authority funding and democratic oversight.
Paul Burstow also heads up SCIE. The expertise already exists in the party. Why is policy being made on the personal experience of the leader as one individual in a specific client group, without addressing structural questions other figures in the party have spent decades wrestling with?
If the boot were on the other foot, and Ed Davey were advising on energy policy, one of his other hobby horses, I fully imagine he would be simultaneously sympathetic but miffed if the harrowing personal experience of an MP who had had family debt accrued by energy company misspelling became the front-and-centre of energy policy without underlying structural analysis.
Michael BG,
my view is that LibDems should support the proposed increase in corporation tax while calling for the NI threshold to be increased to the same level as the personal allowance i.e. from £9500 to £12500. That would put £360 a year in paypackets and save employers £414 per employee per year. This is the kind of support that will be needed if a sharp rise in unemployment is to be avoided as government schemes wind down. Cutting employer NI bills will benefit loss making firms and firms that are big employers while raising CT will clawback some of the expenditure from more profitable firms with smaller headcounts.
Peter Martin,
I might have a go at the article on Japans experience with quantitative easing since 1990, when I get some free time. I think there are important insights there on how businesses and households actually react to a low interest rate environment.
Currently, to be eligible for carers allowance of £67.25 you need to spend at least 35 hours a week caring for someone who is in receipt of benefits and your earnings need to £128 or less a week after tax, National Insurance and expenses.
If you pay a carer to look after the disabled person or your children while you work, you can treat care costs that are less than or equal to 50% of your earnings as an expense.
A UBI (of say £95 per week) does away with much of the conditionality and you can choose to work and pay a carer to assist or not as your individual circumstances dictate.
@ Joe,
Bill Mitchell has always taken a keen interest in what’s happening in Japan. I can’t say I’ve given it that much thought, but from what I can make out Bill is saying the Japanese government are stuck on the notion that more QE means that banks have more money to lend out and stimulate the economy.
But once QE has effectively lowered interest rates to zero then the application of further QE doesn’t have any more effect. Bill would argue that the the Japanese government needs to rely far less on monetary policy and far more on fiscal policy to manage effective demand.
Anyway there is always plenty of data in Bill’s articles even if you disagree with his conclusions.
http://bilbo.economicoutlook.net/blog/?cat=33
Nick and Matt (Bristol) -Many thanks to you both, I shall be happy to learn from you better ways of policy development, which could be most fruitful if the party will be guided by them. Non-experts like myself will need to work within a structure, and our non-expert Leader will I hope also be ready to listen and learn but has the power to set the scene.
The problem we face is not a lack of good policy positions, on important areas of public concern, though we have a fair number of ill thought out and poorly worded ones.
Our problem is not having policy positions where our position is good and where *both* the other parties are clearly wrong on.
We had one, Europe, and Ed has cast it adrift. Now we have Carers, but who says they are against support for carers. Absolutely no one.
So however good our policy is in that area, it will take decades to get it noticed even if we stick with it consistently. And when we are in a position to get publicity for it in an election campaign, it will be reduced to a bidding war. !”Lib Dems propose £3.2 billion for Carers” suddenly being trumped by “Conservatives propose £3.6 billion” and “Labour propose $4.3 billion.”
Caring for Carers will just be yet another not joined up favourite hobby horse of a new leader that is supposed to propel our party to new horizons – just like ‘Proving coalition works,’ ‘Supporter’s Scheme’ or ‘Revoke and a quick election’ – that in act do nothing to redress the mess our party finds itself in.
@David All very fair points. But we have at least the chance to do something Liberal with the carers position we have derived from the peculiar internal groupthink that elected Ed; and there is an intellectual integrity in proofing our policies with the help of carers. The question is whether or not the party is able to rise to the challenge…
Nick Perry,
Have you thought about emailing Ed asking him to set up a mechanism for carers (or some carers) to develop policy ideas for the party? The leader should be able to setup such a thing outside of our policy making process (Vince Cable developed policy outside of our policy making process. I think the paper to support replacing the business rates with a Commercial Land Levy {a form of Land Value Tax} is a good example of this).
At our spring conference there is a motion entitled “Stand up for Unpaid Carers” being discussed on Saturday (F13 page 32). What it calls for are not very radical.
Slightly Off Topic.
Has anyone else noticed that we got 11% in a Poll, the last time we got an 11% was last March. Just one Poll of course we had been confined to a range of 4-10% for nearly a Year.
This may be a straw in the wind – who knows ?
@Paul Barker “Has anyone else noticed that we got 11% in a Poll”
Do you have a link to that?
@Michael BG I have just found this article from George Potter from November:
https://www.libdemvoice.org/its-a-mistake-to-try-to-be-the-party-of-carers-66417.html
It’s interesting to see that we are no further forward really. I suspect that the commentators on that piece who were suggesting the party’s positioning is related to building the image of Ed are not far wrong. Tbh I don’t have the energy or inclination to email. I had the energy to write the article. That is my contribution.
“a call from Louise Casey and others for a new Beveridge Report; and Ed Davey absolutely nowhere to be found on the issue.”
This is true.
“William Beveridge is one of our most famous Liberal forebears; and given the issues that have been brought forward by the pandemic, there is no more important time to claim him as one of our own, with a message that, shockingly, still pertains to post-COVID and post-Brexit Britain.”
But do you really want to do that? As Mark Pack pointed out as long ago a 2011, it is a mistake to think of Beveridge as the founder of the Welfare State. His aim:
“was not security through a welfare state but security by cooperation between the state and the individual”
So he was even less “liberal” than many of us in the MMT community who recognise that unconditional welfarism is a tried and failed experiment. Of course we all want to ensure the welfare of everyone but it is quite reasonable to expect that those being helped by the State do something, if possible and within their mental and physical capabilities, in return. This is both to help the State and help themselves. So we favour the emphasis should be on the Job Guarantee at a living and fair wage rather than the unconditional payment of benefits.
Not that we wish to scrap unconditional benefits in one abrupt change but over time there should be this change of emphasis.
This is from Beveridge 1.0
“Unemployment benefit will continue at the same rate without means test so long as unemployment lasts, but will normally be subject to a condition of attendance at a work or training centre after a certain period.”
So it is us that really should be claiming Beveridge “as one of our own” !
https://www.libdemvoice.org/william-beveridge-welfare-state-22577.html
I would be interested in any party that could advocate – in the context of post-Covid-rebuilding for separating out adult (and possibly children’s) social care, public health, carer issues, mental health support and capacity law review from the DOH and creating a Secretary of State for Care and Wellbeing.
The reality is that primary care — and particularly acute hospital care – is so dominant in the Department of Health that these preventative sectors have been the poor relations for years.
This is of course entirely against the flow, creating a new government department (but if it could be done for Brexit) and seemingly challenging the endless rhetoric of ‘integration’.
But if I ask you ‘who speaks for carers and vulnerable adults at Cabinet level, and do they do so relatively free of a need to speak for the institutions that can unwittingly oppress them?’ how would you answer?
Now we’re looking at a headline policy that addresses structural issues and promises more than short-term cash in hand and tricks with spreadsheets.
This isn’t from the Daily Mail but from a comment, from a ‘Sarah Reigns’, who claimed at the time to support the Lib Dems, on LDV !
“I, for one, am sick and tired of going into work day in day out only to have my taxes taken away to pay for the lazy, feckless unemployed, chavs, cripples, sickness-fakers and anyone else who is workshy. The welfare state has been nothing short of a disaster and there are millions of people in the country who work hard but resent our money going to pay for “sick” or “handicapped” people who, let’s be honest, contribute nothing to society. ”
This is rather an extreme view but nevertheless one with which we are all familiar. The problem is that present day Lib Dems are keen on the idea of Social Benefits but totally recoil from the concept that they should be matched by at least some social obligations.
What the writer of the above passage doesn’t seem to appreciate is that Capitalism requires a pool of reserve labour. There aren’t enough jobs for all. If we have 95 bones buried in a large plot of ground and 100 dogs trying to dig them up we’ll always end up with 5 dogs without any bone for their efforts. It’s no use saying that if they tried as hard as the other dogs they would have found a bone too. There just aren’t enough.
Prospect Magazine had a good article on the legacy of Beveridge in 2017 https://www.prospectmagazine.co.uk/podcasts/the-battle-for-beveridges-welfare-state
The article concluding paragraphs lay down a challenge:
“Whether the question is health or housing, education, employment or poverty relief, the welfare state does all this far from perfectly, and occasionally very badly. But most individuals and families would, surely, still prefer for their own lives to unfold in a world where the welfare state was there at moments of vulnerability, rather than live in the alternative—a world where everyone is for themselves, for good, or ill, or very ill.
A modern-day Beveridge would thus likely aim to foster understanding of the welfare state’s continuing role as an unwritten inter-generational contract. By doing that, he just might be able to encourage taxpayers’ willingness to stump up the funds that the system continues to need.
For the single thing that Beveridge would be crystal clear about is that if the British people, to use his repeated phrase, still want in very changed circumstances a decent system of social security and a wider set of “allied services”—the NHS, education, decent housing for all—then they have to be prepared to advocate, fight, vote and pay for it. My favourite single quote from Beveridge is this. “Freedom from Want cannot be forced on a democracy or given to a democracy. It must be won by them.” As true now as it was then—when people were queuing up for it.”
@Joseph Quite so!
“……the single thing that Beveridge would be crystal clear about is that if the British people…. still want…… a decent system of social security and a wider set of “allied services”—the NHS, education, decent housing for all—then they have to be prepared to…… pay for it.”
Beveridge was “crystal clear” about more that a “single thing”. It’s hard to get the feeling that many, or even nearly all, of those who are clamouring for a Beveridge 2.0 have ever read Beveridge 1.0. If they had they might have noticed that Beveridge was “crystal clear” that his program was only feasible under conditions of full employment.
But when did we last hear any prominent politician give a commitment to that? It’s not a phrase that is used much at all these days in polite company. Instead we hear a lot of nonsense on how the robots are going to take all our jobs but, not to worry, those nice LibDems are going to come to our rescue with their Universal Basic Income. I don’t think so.
We should bear in mind that Beveridge produced his report in the middle of a major war. He and everyone else knew that the war had to be “paid for”. But this didn’t mean that the Government, or Beveridge, expected that taxation receipts had to equal expenditure. This is the implication of “paid for”. The war was paid for by the efforts of everyone working in the factories and serving in the armed forces. It was paid for by producing real things that were of some use. Hardly anyone needed unemployment benefits because there wasn’t much if any unemployment!
@ Peter Martin “It’s hard to get the feeling that many, or even nearly all, of those who are clamouring for a Beveridge 2.0 have ever read Beveridge 1.0.”
Come now, Peter, that’s a bit ungracious. However, so I’m sure we’re grateful to you for troubling to share all your expertise and knowledge on LDV. I personally have no doubt whatsoever that you have a well thumbed copy of Beveridge 1.0 at the side of your bed and when you can’t sleep you read every dot and comma.
However, just in case there are any ungrateful doubters out there on LDV perhaps you could confirm your expertise by telling us :
1. The name of the Government Minister who announced he had arranged with all the Departments concerned for a comprehensive survey of existing schemes of social insurance and allied services and that he had appointed Sir William Beveridge to become Chair of the Interdepartmental Committee which would conduct the survey ?
2. What date did the Minister make this announcement in the Commons ?
3. What was the name of the Ministry held by the Minister ?
4. To which political party did said Minister belong ?
5. What was the title of the Committee which would consider said survey ‘in due course’ ?
David Raw,
This is 2021. The purpose of books is to place in the background of zoom calls to create the right impression. The Beveridge report is readable on-line. Beveridge also wrote “Full Employment in Free Society” and that’s also worth a look.
I’m not sure what good it does to know the title of the various committees etc. I don’t think anyone is expected to know these kinds of minor details.
But, look, I’m not a Liberal or a Lib Dem. It’s not me that is calling for a Beveridge 2. But, although I have not read every “dot and comma”, as you put it, I have read enough to know that some Lib Dems do have it right on Beveridge.
I’m thinking of Mark Pack in the link I previously gave.
@ Peter Martin, “I don’t think anyone is expected to know these kinds of minor details”.
What is the point then, other than hinting at your own very superior knowledge, of your comment, “It’s hard to get the feeling that many, or even nearly all, of those who are clamouring for a Beveridge 2.0 have ever read Beveridge 1.0.” ?
Incidentally, knowing which Minister appointed Beveridge to chair the Interdepartmental Committee could be regarded as of some political significance and guidance for those now seeking a Beveridge 2.
Peter Martin,
Beveridge wrote his paper on full employment in the context of the Bretton Woods monetary system and capital controls that were designed to maintain confidence in International currencies. What Beveridge meant by “paid for” was a contributory scheme of national insurance that was maintained in a hypothecated social fund. While there is an accounting record for the national insurance fund it has never been separately maintained from other treasury funds. That would require an independently managed sovereign wealth fund.
The UK relied heavily on borrowing from the US and Canada to finance WW2, without which much of the food and oil imports and war material (initially via lend lease) required would not have been available.
Central banks like the BofE have a single overriding objective. That is inflation targeting to support economic growth and stability i.e. the crucial conditions for full employment.
Central banks react to economic conditions they don’t drive them. The reduction of interest rates to zero and below in some cases since the financial crisis of 2008 is reaction to structural changes in the global economy that have driven down the real rate of interest. Those changes include a steep rise in savings (particularly in Asia) and a fall in the rate of investment.
Government fiscal policy, reliant on taxation, is based on the delivery of public services, social security and long-term investment programs that support and develop economic growth including investment in infrastructure, education and research and development. Fiscal policy together with monetary policy mitigates the extremes of economic cycles it neither eliminates those swings or substitutes for the productivty enhancements that come with technological advances.
If more people read books there might be a greater appreciation of the misery that loss of control of a country’s finances can bring. Ben Bernanke’s book, Essays on the Great Depression, that focuses on the Great Depression as a credit implosion, not so much the money supply would be a good one; as would Adam Fergusons “When Money Dies: The Nightmare of Deficit Spending, Devaluation, and Hyperinflation in Weimar Germany”
@ David Raw
The point is, as Joe has just explained, and Mark Pack too some years previously, that Beveridge 1.0 is a contributory scheme with conditions attached. It doesn’t sit well with modern day Lib Dem concepts of unconditional welfarism and much less still with universal basic income payments. Knowing the name of some obscure committee is much less important than understanding the general intent of the original Beveridge report.
@ Joe
I think Breton Woods was agreed in 1944 and after the Beveridge report was published. It was essentially a system of fixed exchange rates and so made pursuing a policy of full employment more difficult than it would otherwise have been.
We see this still in the eurozone. There’s really nothing that countries like Italy and Greece can do to create full employment. At least if there were a Breton Woods style system in the EU there could be some revaluations and devaluations to adjust national economies to changing international conditions. A System of floating exchange rates is preferable to both and avoids the political fall out that comes with sudden larger jumps in currency values.
The international reduction in interest rates is simply a consequence of the prevailing mainstream fad that monetary policy should be used to regulate aggregate demand rather than fiscal policy. There have been many more downwards movements in interest rates to try to stimulate demand than upwards movements to restrict it. Who would have predicted otherwise?
We were, therefore, always going to end up where we are now with near zero interest rates. There’s no immediate sign of them going higher and they will only go higher if governments want them to. But why would they?
Yes there was borrowing during WW2 from the USA and probably in terms of gold or US dollars. It was unavoidable to some extent in wartime but even so most UK debt would have been issued in sterling. As it is now at another time of national emergency.
We don’t have to borrow that from anyone. The UK govt is the monopoly issuer. Yes there is a danger that we can generate too much inflation if we overdo it. It’s a problem to be dealt with if and when it happens.
Peter Martin. While Sir William Beveridge wanted people to contribute regularly a small amount, his central premise was, so I gathered from listening to his interview with Pathe News, still available on YouTube, that nobody should ever be left destitute without any money at all. He would therefore have approved of a system of ensuring that everyone does have some basic funding. Liberal Democrats want that, and have sought to ensure that welfare spending is sufficient for people to survive on, whether or not a Universal Basic Income is ever agreed. UBI is not the answer for bringing everybody up to the poverty level as soon as possible, especially in these years when poverty is increasing because of loss of livelihoods and now of Brexit probably resulting in food price increases. It is rather basic information that poor people spend a larger amount of their income on food and other necessities than do the better-off. Sir William wanted first and foremost to abolish Want.
Peter Martin,
Did you read my comment above made on 24th Feb at 3.08 am? In that comment I pointed out that the Beveridge-2 or Revitalisation Plan that Katharine and I are advocating includes a desire for full employment and will include something on voluntary job guarantee schemes. I also pointed out that a job guarantee scheme for disabled people is being considered at our March conference.
In the past I have pointed out to you that the post-war Beveridge social contract did include benefits without any contribution. I pointed out to you the National Assistance Act 1948 abolished the Poor Law system and established a safety net for those who had not paid enough national insurance contributions. It provided National Assistance to these people, which was a means-tested benefit. You have accepted that there is a need for such benefits and you don’t advocate that they are abolished. Therefore a Beveridge-2 social contract does not have to establish any new scheme of benefits which only those who have paid National Insurance contributions are entitled to receive. Today the amount a person received according to their National Insurance contributions are the same as the level of benefit they are entitled to if they have no income. In the same way as Beveridge wanted to eliminate “want” we want to ensure no-one in the UK has an income below the poverty line.
@ Katharine @Michael BG,
We, on the left, all want a fairer society and to avoid anyone living below the poverty line and /or becoming destitute and homeless. We’ve been trying to do this at least since the start of the post-war period. There have been successes but the fact that we are still discussing the problem in 2021 shows it is far from being solved.
I did read Michael’s comment that Lib Dems were discussing the implementation of a voluntary JG scheme. I’ll be interested to see how that goes. There could be more opposition than you might expect. There will be dismissive talk of ‘workfare’ etc but the problem is more deep seated. Just suppose we do set up a successful JG scheme which is voluntary in the sense that anyone has the option of keeping existing benefits if they decline the offer. Let’s suppose the vast majority of unemployed workers take this up. There will still be a minority of workers who refuse. Some will have good reason but some won’t. There will then be a public clamour that those who do refuse should have their social benefits cut or even removed. It doesn’t really matter what you and I think, that’s what the majority of voters will say. So, what starts off as a voluntary scheme will quickly become ‘voluntary’ only in the sense that anyone can choose not to participate; but, if they don’t, they won’t get paid.
Most LibDems won’t want to go down this road because it cuts across 21st century notions of what liberalism means. They will see any scheme, such as the one you are proposing, as the thin end of a wedge. It wouldn’t have caused Sir William any problem though! Liberalism/ LibDem-ism now isn’t the same as it was during his lifetime. We socialists don’t have that same problem either. We are more accepting of the need for social obligations to be met by all providing that the fruits of our labours are equitably distributed.
So, all that is left for the left-of-centre “progressive left” is to advocate the type of unconditional welfarism that isn’t at all popular with the voters, and that’s unlikely to ever get anywhere.
Bill Mitchell discusses the question at (very much) greater length in “Tracing the roots of progressive views on the duty to work” in a series of article starting with this one.
http://bilbo.economicoutlook.net/blog/?p=45514
Peter Martin,
In the past we discussed what should happened to the person who refuses to work. I suggested that if they have children, then not paying them enough to live on could cost the state more. If a parent does not provide for their children then the state is likely to take those children into care and it costs huge amounts to finance a child in care. Even if the person who refuses to work has no children, the lack of money might lead that person into committing crimes and ending up in jail. It costs huge amounts to keep someone in jail (I think I provided the amount). You accepted these facts and accepted that even where a person refuses to work it is cheaper for society to pay them an amount of benefit to live on rather than the more expensive alternatives. As this argument convinced you, it is likely to work on the doorstep and convince others that paying a person an amount at the poverty level is cheaper than the state imprisoning them and caring for their children
However my solution is a liberal solution which values each person. The communist system as described by Bill Mitchell does not. It believed it was acceptable for someone who refuses to work to starve. I want to build a liberal society not a communist society.
Peter Martin,
Beveridge’s paper on full employment (Full Employment in a Free Society) was published in 1945. He defined full employment as a state where there are slightly more vacant jobs than there are available workers and Beveridge estimated that would mean a rate of unemployment of 3% to accommodate both frictional and structural unemployment. This was indeed achieved after the war under the Bretton Woods monetary system.
Inflation targeting remains the primary objective of monetary policy. As long as the economic trends that have kept inflation low continue, interest rates will be held down. Once those trends go into reverse, then central banks will react and start to raise interest rates. Interest rates will likely begin to increase as wages, domestic consumption and living standards in China increase and oil and commodity prices start to go up; as they did in the 1970s/80s to temper the inflation created by the absence of tax funding for spending on the Vietnam War and Lydon Johnson’s great society programs.
A key point about any inflation in “When Money Dies” is that it builds up over time. In the case of the Weimar hyper-inflation over a period of 9 years from 1914 to the collapse of 1923. An event like reparations default or the Opec oil price hike of the 1970s might be the catalyst or tipping point but the underlying conditions accumulate over time.
“Germany tried to meet the colossal costs of the war [WW1] by an appeal to the self-sacrificing spirit of the people. ‘I gave gold for iron’ was the slogan for the surrender of gold ornaments and jewellery. ‘Invest in War Loan’ ran the appeal to the patriotic sense of duty of all classes. Issue after issue of War Loan transformed the greater part of German private fortunes into paper claims on the State. Our enemies, especially Britain, took another line. They met the cost of war with taxes aimed primarily at those industries and groups to whom the war spelled prosperity. Britain’s policy of taxation proved socially more equitable than Germany’s policy of War Loans which lost their value after the war was over …”
@ Michael BG,
I’m enough of a Liberal Socialist, some might say Liberal Communist, for this question not to cause me some problem. But convincing me isn’t the issue. You have to convince a majority of voters too.
Your suggestion of a Revitalisation Plan is much better than Beveridge 2.0 I doubt that there is much name recognition there anyway. Try asking 100 people at random if they have ever heard of Beveridge. It won’t be a pointless answer but it won’t be far off!
@ Joe,
Everyone who calls for a Beveridge 2.0 should at least take a look at Beveridge 1.0. They might have some problem with quite large parts of it, including the sexism (as it now looks to us) of Beveridge at the time. For example he classes all married women of working age as “housewives”. See page 10 of the link below.
His assumption with this report is that there was a condition of close to full employment. He might have described this in more detail later but it’s unlikely the Breton Woods agreement suddenly persuaded him that condition of full employment was possible where it wasn’t before. As you’ve said he advocated a system of social paid insurance and this is only possible if we have close to levels of full employment.
Obviously the difference in outcomes between Germany and the UK after WW1 is more easily explicable by simply pointing out which side was victorious and which side lost and had to pay the reparations.
There was a generalised system of compulsory and encouraged voluntary saving during WW2 in the UK and USA too. If the Government is running a deficit, as Govts tend to want to do during wartime, then someone else has to be running a surplus. This means doing the lending. This mainly has to come from the Domestic Private Sector.
http://pombo.free.fr/beveridge42.pdf
@ Peter Martin “They might have some problem with quite large parts of it, including the sexism (as it now looks to us) of Beveridge at the time.” Happy to agree, Peter…and it wasn’t just Beveridge.
The saintly H.H. Asquith was at it too. Despite at long last casting his vote for the female franchise in 1918, he wrote (4 January, 1920) to his regular correspondent, Mrs Hilda Harrison (a war widow), of the Spen Valley byelection result,
“I always had a strong feeling that we should not quite pull it off, but the Coalition dummy polled more than I expected. I have no doubt that these damned women were to blame”.
On 30 January, 1920 in the Paisley campaign (which he won), he again wrote to Hilda to describe the campaign,
“There are about fifteen thousand women on the register – a dim, impenetrable for the most part ungettable element – of whom all that one knows is that they are for the most part hopelessly ignorant of politics, credulous to the last degree, and flickering with gusts of sentiment like a candle in the wind”.
Peter Martin,
who were the victors from WW1? The central powers were ruined, but so too was France’s economy ruined. The loss of manpower for production and also the wreck of agricultural land, bought an increased need for imports from other countries. The state spent a huge amount of money to get medical care for the millions of wounded that had survived the war.
The UK suffered depression and deflation in the aftermath of the Great War. Russia went through the turmoil of its Bolshevik revolution ultimately leading to the Ukrainian famine in 1933.
The victors on the economic front were the USA and Japan (a UK ally in WW1). Japan’s economy was doing just fine after WWI until the great depression cut off their export markets; and the USA entered the roaring twenties until the 1929 Wall Street Crash brought the party to an end.
So too after WW2 the longest lasting recoveries into the 1980s were seen in Germany and Japan sometimes dubbed the ‘economic miracle’.
In the 1923 hyper-inflaton, Germany did not pay the reparations. When France and Belgium sent troops into the Ruhr Valley, the German government ordered workers to follow a policy of ‘passive resistance’ – refusing to work or co-operate with the foreign troops.
Germany was already suffering from high levels of inflation due to the effects of the war and the increasing government debt. ‘Passive resistance’ meant that whilst the workers were on strike fewer industrial goods were being produced, which weakened the economy still further. In order to pay the striking workers the government simply printed more money. This flood of money triggered the hyperinflation as the more money was printed, the more prices rose.
The conditions for hyper-inflation built up throughout the course of the war and its aftermath. If simply paying workers wages with printed money was the cause of inflation, we would be seeing it now across the world during this pandemic when so much domestic production has been idle. But production is not idle everywhere and crucially not in China where so much manufacturing is now based.
These are the lessons of history. Full employment and improvements in standards of living are delivered by maintaining productive capacity and a competitive position in International trade based on financial and political stability. It cannot be delivered by fiscal or monetary policy alone.
@Paul Barker “Has anyone else noticed that we got 11% in a Poll”
Still not seen any sign of that 11% poll, but there have been two more putting Lib Dems on 7%.
There have also been polling figures for Welsh and Scottish elections that must make very gloomy reading. One YouGov poll for the Welsh elections put Lib Dems in 5th place on 4% for the constituency vote and 7th (!) place on 2% for the list vote.
You beat me to it, Peter. Those are possibly our worst ever poll ratings in Wales (and we’re 4% in two different polls). There’s a good chance we’ll get wiped out. There’s no discernable strategy from the party as to how that gets turned around – we’ve had no discernable strategy for electoral success for the last 10 years in fact. Quite frankly, the Welsh party needs to be put under special measures.
Latest Regional poll in Scotland
Survation/Daily Record completed 24–25 Feb 2021 sample 1,011
SNP 38%
CON 21%
LAB 20%
GREEN 11%
LIB 7%
others 3%
SNP LEAD CUT, slight Labour rise,
Greens going to increase numbers of MSP’s, LIB-DEM ???
Peter Martin. I dispute that moral virtue resides more in active Socialists than in Lib Dems! Referring back to your post of 10.29 this morning, I don’t believe that any of our party activists would be murmuring about ‘workfare’ or worrying about the possible refusal of some people of working age to accept a Guaranteed Job offer. If Lib Dems thought like that they wouldn’t have passed the idealistic UBI motion at the last Conference.
I do agree that there could be reaction in parts of the wider citizenry, many of whom we learn do focus resentfully on the work-shy and supposed scroungers. But it still wouldn’t be an outcry, for the simple reason that for many frequently or long-term unemployed people there will be a time of officials trying to find each of them suitable work and perhaps failing to do so, or for the people’s own requirements and expectations changing meantime – grey and shifting areas probably in practice, especially if the unemployment rate sticks at 5% or more because of lack of job vacancies.
Peter Watson, I notice as you do the sad fact that our party poll ratings have stuck at no more than 7 % for months now, and that is why our Leader really does need to get behind the proposal of a National Recovery or Revitalisation Plan to cover all the areas of Beveridge-2. Michael and I are urging all supporters to write to Ed to ask him to speak for this in his Conference speech in three weeks’ time, and ask him to expedite the setting up of a powerful new Working Group to formulate the Plan.
PS – I see that I have slipped into calling the proposed Plan one of Recovery rather than my usual Renewal or Michael’s Revitalisation name for it! Revival, anyone?! What’s in the name, friends – the idea is clearly there, and the actuality of it needs at this juncture our Leader’s support. Please help if you agree and drop him a line (probably post this week’s Budget) to ask for his adherence to the proposal, which can cover his Carers’ Campaign, though he should ask Nick about who the Working Group should consult on that part of the Plan.
@ Katharine
I didn’t say that socialists possessed more “moral virtue”. I’m not sure how that is a useful guide in any case.
The socialist view of human nature is not at all as idealistic as the lib dems. We don’t trust the capitalists to treat their workers fairly for a start!
The vast majority of people work honestly and can be relied upon to ensure society functions as well as it does. But there is an undesirable minority too. Marx referred to them as the lumpen proletariat.
If you don’t know what I mean about the latter you might want to catch up with tonight’s Panorama program (if you haven’t already seen it) about the flytippers. If you pay them a UBI do you really think they will mend their ways and use the money to fund their inner creative spirit.
I really don’t have any qualms about offering such individuals one chance to earn an honest living. If they turn it down I really don’t care what happens to them after that providing they are stopped from pursuing their criminal activities.
Hi, Peter, I haven’t heard about a ‘lumpen proletariat’ and I hadn’t time to watch Panorama, but I take your point. You may recall that I personally am not enthusiastic about UBI, but as a Liberal I do want everyone to have means of subsistence, whatever their nature. I care most about lifting people to the poverty level – all of them – and a UBI of £95 a week for a single person wouldn’t in itself do that, even if it can be afforded. But perhaps there will be additional benefits for housing and (of course) child and dependent adult care, and for disability, plus pensions. It all needs lots of good thinking out, and I want my party to set about undertaking that – and showing the country that we can offer what everybody needs, and a fresh new radical spirit to promote it.