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Fairness and the Elephant in the Room

January 10, 2013

The Elephant in the Room suggests the calls for “fairness and equality” are really the language of self interest.

How much more should we give non-pension welfare benefit claimants this year? This posting considers the way the debate is framed and calls into question the use of the term “fairness”. The only reasonable outcome for a successful moral argument on the re-distribution of wealth from our current position is an increase in the overseas development budget. Not an argument I am currently hearing from Labour or renegade LibDems. Their motives are based on advocating for their client groups i.e. those on welfare, unions and the public sector to improve their financial position – in order to retain/ regain power – i.e. their arguments may sound moral but are just as economically self-interested as those calling for tax reductions.

By way of summary, benefit claimants might receive money from the government in the form of tax credits, job seekers allowance, maternity pay, sick pay. All of these benefits increased at a rate of 5.2% this year. A stark figure when one considers the state of the economy, the size of the deficit and the fact that most working people where happy to keep their job, let alone lobby for a pay increase of 5.2%. The argument falls to whether increases in benefits should increase (not be cut, slashed, decimated or sacrificed) by 1% or around 2.2% (roughly the rate of CPI). So for someone on jobseekers, the debate revolves around 9 pence per day relative to an income of around £57 per week.

The debate is typically – but not always – framed by re-distributors suggesting “pain should be shared”, “all must make sacrifices”, “its unfair that the people who caused the crash should suffer” etc. We have seen demonstrations by teachers, nurses, anti-capitalists and others complain that they are “suffering”. Is any of this true? Is any of this reasonable?

Looking at the facts, the public sector hasn’t at any stage considered the possibility of pay cuts since the events of 2008. Growth in public sector spending has in fact increased. A lot. So what is the tenor of the complaint? It is true there have been a number of job losses in the public sector, but there has also been an awful lot of hiring in the public sector. The debate appears to be coalescing not around the notion of a fair distribution of tax revenue but around redistribution in general. We have heard many times politicians indicate equality between the increasing of tax and the giving of payments. They are not the same thing (see my earlier blog on the difference between giving and taking). 

The question to be asked then is what underpins a fair distribution? The emotive argument about providing for others certainly has moral merit, but why would the provision of benefits to others be necessarily restricted to people within national borders? Surely the elephant in the room is the argument that a fair distribution must dictate the following:

If re-distribution is going to take place, the most deserving are the most in need.

The most in need surely can’t be classified as people who are provided with a free education, free heath service, financial payments each week, free housing (and if they are lucky in places like Chelsea and Hampstead) etc. The most in need must include the 5 million children that die each year of diaherra, those staving to death, those children who parents have been killed in conflict, those children who have been born with aids in states that don’t have a developed health system, those children who don’t live with security of access to water?

If a moral argument about fairness of re-distribution is raised by the left, why is the moral argument directed towards people who, in the standards of the world we live in, are in the top 5% – even if they are on welfare benefits. Surely, the only logical argument for increases in welfare payments on grounds of fairness of distribution must only be valid if they are directed towards an increase in the overseas development budget? The extra 9 pence per day, would after all save a child’s life by purchasing oral rehydration sachets.

http://rehydrate.org/ors/index.html

 If a moral argument about justice and fairness are raised about re-distribution on grounds of equality (I am thinking here about some proto-communist writers such as Richard Murphy among many other “liberal press” scribblers), surely the real needy must be first in line? Shouldn’t they be advocating for a slashing of welfare benefits and a re-allocation to the overseas development budget? One has to wonder why they don’t, after all, the philosophical underpinnings of their moral voice are not state constrained (such as Rawls in “A theory of Justice” or Murphy/Nagel in “The Myth of Ownership”). In the allocation of scare resources and on their current argument, the UK liberal left prefer to provide free housing in Knightsbridge rather than feeding staving children. Is that a moral argument – it doesn’t look like one to me.

I suppose the greatest embarrassment for the argument for equality is that those who are victoriously arguing for it are most likely to be economic beneficiaries –  providing of course that their notion of “equality” and “relative poverty” places them in a position to be recipients rather than donors. I would be far more open and willing to listen to arguments for equality if this meant those advocating it were not potential economic winners from their successful argument. The fact that in the overwhelming majority of circumstances, they are – only serves as evidence that Milton Friedman’s “rational agent” theory is still alive and kicking in 2013. Until I hear the mainstream left start to argue for redistribution towards international aid and away from the welfare budget – they are every bit the neo-classical, neo-liberal self interested agents as described in economic theory. 

How embarrassing… 

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