14 August 2011

Thatcher's Grandchildren

Despite the ravings of Tim Montgomerie and Peter Hitchens, the Welfare State is not at the root of what led to the English riots of the last week; they're not far wrong about the collapse of popular morality, but they're completely off-base when it comes to the Welfare State. If anything, the British Welfare State as it now stands, and the 'underclass' it sustains, is a symptom of a far more serious problem, and one effectively created by the British Right.

Blair's Children?
You don't believe me? Do you think that the Spectator's Harriet Sargeant is right to say of the rioters of the last week:
'These young men came of age during the thirteen years of Labour. They are Blair’s children and the Left’s creation. It is not deprivation that has stunted their lives, but the policies of the previous government in three key areas – school, work and home.'
Rot. Blair's government failed to deal with the massive problem that it had been left, but it certainly didn't create the mess. It inherited it. It's worth taking a look at Will Hutton's 1994 book, The State We're In, simply to get a picture of Britain's underclass after fourteen years of Conservative rule. Just plucking a couple of passages from the first chapter, these being supported in detail later in the book:
'For two decades unemployment has been a grim fact of British life, bearing particularly hard on men. As well as those included in the official count who want work and can't find it, there are millions more who are marginalised -- prematurely retired or living off inadequate savings or sickness benefit. One in four of the country's males of working age is now either officially unemployed or idle, with incalculable consequences for our well-being and social cohesion. The numbers living in poverty have grown to awesome proportions, and the signs of social stress -- from family breakdown to the growth of crime -- mount almost daily.
One in three of the nation's children grows up in poverty. In 1991 one twenty-year-old in five was innumerate; one in seven was illiterate. The prison population is the highest in Europe. The British are failing.
Above all, we live in a new world of us and them. The sense of belonging to a successful national project has all but disappeared. Average living standards may have risen but have not generated a sense of well-being; if anything there is more discontent because the gains have been spread so unevenly and are felt to be so evanescent. The country is increasingly divided against itself, with an arrogant officer class apparently indifferent to the other ranks it commands. The privileged class is favoured with education, jobs, housing and pensions. At the other end of the scale more and more people discover they are the new working poor, or live off the state in semi-poverty. Their paths out of this situation are closing down as the world in which they are trapped becomes meaner, harder and more corrupting. In between there are growing numbers of people who are insecure, fearful for their jobs in an age of permanent 'down-sizing', 'cost-cutting' and 'casualisation' and ever more worried about their ability to maintain a decent standard of living.

The rot starts at the top...'
Sounds eerily familiar, eh? Blair inherited this problem, and it was monstrous even when he took the helm. 

With the Imprimatur of a Conservative Leader
What's more, lest you think this is just 'typical left wing rubbish', you might be interested in what Iain Duncan Smith's Centre for Social Justice had to say in their massive and probably definitive study, Dying to Belong: An In-depth Review of Street Gangs in Britain. Just quoting from the executive summary:
'The past few decades have seen an increasing socio-economic divide between the haves and the have-nots which, coupled with an environment of intense and overt consumerism, is often explicit in the global city where poverty and wealth sit side-by-side. The decline of industry and the rise of the knowledge economy have been instrumental in this: significant parts of the working class have become the workless class and their income has plummeted accordingly.

Particularly hard hit were young people, and in particular young men. Between 1984 and 1997 employment amongst 16-24 year olds decreased by almost 40 per cent and by winter 2006/07 youth unemployment had increased by a further 18,000 on its 1997 level. Work not only provides regular income, but also provides a sense of purpose, identity and belonging. It is no coincidence the highest prevalence of gangs is found in areas with the highest levels of general worklessness and youth unemployment: the gang as an alternative to mainstream employment, offering the same advantages.

In addition to a changing labour market came a shift in the function of social housing: no longer were council estates home to working, stable families and long-term residents. The introduction in the 1980s of right-to-buy coupled with a major reduction in new building and a shift in allocations policy has meant that social housing is now home to some of our most disadvantaged and vulnerable individuals and families. The majority of social housing households are now headed by young, workless lone parents and single men and women, often with incomes below the poverty line.

Gangs are, unsurprisingly, most commonly found in these highly deprived areas. These factors together have created, in certain communities, a generation of disenfranchised young people. Alienated from mainstream society these young people have created their own, alternative, society – the gang – and they live by the gang’s rules: the "code of the street".'
Look at that. The decline of British industry basically created this mess by turning significant parts of Britain's working class into a workless class, and Thatcher's housing policies made the situation worse. Section 4.1 of the report explores this issues more thoroughly. It notes how modern gang culture is a specific creation of an era when Britain's poorest people became even poorer, when conspicuous consumption became the hallmark of success, when deindustrialisation gave rise to high unemployment and a new type of labour market which reduced opportunities for young people of few qualifications, when the stigmatisation of the urban poor reduced their hopes for betterment...

You Can't Make An Omelette Without Breaking Some Eggs
I don't think any sane person would hold any view other that British industry in the late seventies was deeply inefficient and in dire need of reform; reform, however, should not be confused with deracination, which is what happened under Thatcher. In her determination to reduce inflation, she was willing to pay pretty much any price -- or, more precisely, to have Britain's working classes pay any price. There's a reason why she never had the support of anything close to a majority of British voters. Just quoting from Andrew Marr's A History of Modern Britain, because that happens to be on the shelf near me:
'In politics, if your tactics work and you are lucky -- then you will be remembered for your principles. Margaret Thatcher's tactics did work; she was shrewd, manipulative and bold, verging on reckless. She was also extremely lucky. Had Labour not been busy disembowelling itself and had a corrupt, desperate dictatorship in South America not taken a nationalistic gamble with some island sheep-farmers, her government would probably have been destroyed after a single term. Had the majority in her cabinet who disagreed with her about the economy been prepared to say boo to a goose, she might have been forced out even before that. In either case her principles, 'Thatcherism', would be a half forgotten doctrine, mumbled about by historians instead of being the single most potent medicine ever spooned down the gagging post-war British.


The great confrontation would have come in 1981. Howe believed that despite unemployment at 2.7 million and heading towards 3 million, despite the economy continuing to shrivel, with new bankruptcies being reported by the day and the biggest collapse in industrial production in a single year since 1921, and despite the lack of any clear control over the money supply, he must go further still. Swingeing cuts and rises in taxes, this time by freezing tax thresholds, would take a further £4 bn out of the economy. Thatcher told her new economic adviser Alan Walters that 'they may get me for this' but that it would be worth it for doing the right thing. Outside her circle, it seemed anything but right. Famously, 354 economists wrote to the papers denouncing the policies. The Conservatives crashed in third place in the opinion polls behind the SDP and the left-wing Labour Party of Michael Foot. On the streets rioting seemed to be confirming all the worst fears of those who had predicted that monetarism would tear the country apart...'
Thatcher's policies worked, of course, for a certain value of 'worked'. By the time she finished, Britain was a post-industrial nation. The country that had been the Workshop of the World had boarded up its factories and closed down its mines, and the transformation of the United Kingdom into a service economy was well underway. Given the role of finance in this, the Pound became a symbol of all that was booming in Britain's economy, while Mrs Thatcher, previously an advocate of European integration, suddenly became an outspoken opponent of the plan for monetary union that Britain knew had been on the cards since before the UK signed the Treaty of Rome and of the pan-European plans for common policies on work and society that she had championed in Parliament on 8 April 1975.

Putting All Your Unbroken Eggs In One Basket
What this meant, of course, was that Britain no longer sold things; and so the people who previously made things to be sold became surplus to requirements. They had nothing to contribute any more. Sure, the more able ones could be retrained -- though both Thatcher's and Major's governments maintained that training was something best provided by the private sector than by the State and  that training was not in itself a public good that could lower social security costs -- but Conservative Britain had laughable facilities for retraining, and in any case, not everybody is bright enough for ordinary jobs in the 'knowledge economy'. The effect was that for many Britons in the era of Thatcher, their old jobs disappeared and most new jobs that appeared were beyond their abilities, such that the best they could hope for were jobs that paid little, gave little security, and offered no future.

As those working class people who could bought their own homes, their doing so being facilitated by the Conservative governments of the 1980s, so council estates ceased to be stable neighbourhoods of stable families and long-term residents, instead becoming ghettoes of intergenerational deprivation and despair, with no visible way out for those left behind. The result was a demoralised underclass of unemployed and unemployable Morlocks.

It didn't have to be this way; there's a popular myth, hammered out for decades by neoliberal thinkers and politicians, that says that Britain had no choice, that there was no alternative. This is nonsense. Other countries still make things. Other countries still provide real and meaningful work for their poorest citizens. Look at last year's trade figures across the EU.  Germany had a trade surplus of  more than €140 b. Ireland's surplus was more than €40 bn. The Netherlands was more than €38 bn. And the UK? The UK has the worst trade deficit in the entire EU, at more than €105 bn. It makes nothing.

This is one respect in which I think David Quinn was deeply wrong in his Irish Independent piece on Friday. Social liberalism hasn't laid the foundations for widescale riots in Ireland -- sure, our shared morality has been eroded and has begun to fragment, but the fact of the matter is that we still make stuff. We have farms and we have factories and we sell physical things all over the world; even now, with the economy suffering in the aftermath of the property-construction bubble, we're still selling things, and still providing work for ordinary people. Not as much as we were, and not as much as we'd like to, but we're doing it.

British industry didn't need to be destroyed; it needed to be reformed, and Thatcher's line of attack has had devastating consequences. To quote Will Hutton again, from chapter seven of The State We're In:
'The collapse of social cohesion that comes when the market is allowed to rip through society has produced a fall in the growth rate; marginalisation, deprivation and exclusion have proved economically irrational.

The social consequences are profound. The virtual stagnation of incomes for people in the bottom third of the population has affected the very marrow of society. Holding families together has become more difficult as the wages and conditions of unskilled adult males has deteriorated.'
And it's into that poisonous soil that the seeds of social liberalism and moral relativism flourished in the most suffocating, paralysing, brutalising, alienating, stigmatising, and destructive ways possible. Whenever Cameron or his acolytes speak of Broken Britain they should give some thought to who broke it.

No such thing as society? Not when she was finished with it.


shane said...

This is indeed an excellent post.

Anonymous said...

You say:
“As those working class people who could bought their own homes, their doing so being facilitated by the Conservative governments of the 1980s, so council estates ceased to be stable neighbourhoods of stable families and long-term residents, instead becoming ghettoes of intergenerational deprivation and despair, with no visible way out for those left behind. The result was a demoralised underclass of unemployed and unemployable Morlocks.”

I thought the facilitation was to allow residents to buy the council house they lived in rather than continuing to rent them; the idea being that those who owned their own home would be more involved with, and attuned to, their neighbourhood and community. I don’t see then why this led to a regression from “stable families” in “stable neighbourhoods” to “ghettoes of intergenerational deprivation and despair, with no visible way out for those left behind.”

The Thirsty Gargoyle said...

That certainly was the idea, and I think it was a very good one. It's very sad that it hasn't worked that way in practice. Essentially what seems to have happened is that once those with get up and go owned their own property they got up and went.

Quoting from IDS's CSJ report again:
'At the same time as the nature of the labour market changed, so too did the nature of social housing. No longer were council estates home to the working classes, to stable families and long-term residents. Instead, the 1980s saw a shift in the composition of social housing which has helped create the current
climate. During this period, those families who could afford to benefited from the right-to-buy. This, coupled with a major reduction in new building, meant that social housing became the preserve of the most vulnerable and needy individuals and families.

From the 1990s onwards three quarters of new households in social housing were headed by a 16-29 year old, with a heavy concentration of lone parents. The proportion of heads of households not in work in social housing has increased from 52 per cent in 1982 to 67 per cent in 2007. In other households the proportion has remained static at just 33 per cent – demonstrating the increasing polarisation between those living in social housing and the rest of society. The disparity is even starker for heads of households aged between 25 and 54: in social rented housing half are not in paid work compared to just one in twenty of those in owner-occupation.

Correspondingly, the average income of social housing tenants plummeted – from 73 per cent of the national average to just 48 per cent, taking them below the current poverty line. In short, allocations policy meant that social housing became the placing ground for the most disadvantaged people in society and has now become an incubator of deprivation, hopelessness and crime: a "social apartheid" has developed.

Current allocations policy has also had a psychological impact on some social housing residents. On a visit to the Aston Estate in SouthWest London, two young males told the Working Group that councils ‘dump’ single families, drug addicts and people with mental health disorders in estates, and that they were deliberately cut off from the rest of society. Twenty year old Warren concluded: "what do you expect us to grow up to be?"'

I'm not saying for one minute that this Conservative policy was the only factor in creating the current conditions, but I do think it was a very important one. I'll write more in the blog itself.

Donum Vitae said...

Lots to learn here!

Anonymous said...

Thank you. I guess I'll wait to see what further you add in your blog for I still miss the connection.
If people who bought their council houses were no longer regarded as being part of those in "social housing", then clearly the remainder that then constituted the social housing group would consist of a statistically higher proportion of the unemployed and one-parent families. But this in itself is a mere statistical realignment, not a change in the reality of who lived where and in what community or neighbourhood.