Courtesy of The Automatic Earth.
Arthur Rothstein “Family on relief living in shanty at city dump, Herrin, Illinois January 1939
I like alternatives that people draw up for how our societies can be better run and better positioned for both hard times and good. I also like tearing into any such plans, a taste I acquired after being exposed to too much well-meant not-so-smart nonsense. It’s become a kind of a sport to figure out where the next batch of ignoramuses lose their way. Not that I’m 100% sure the Fabian Society in Britain lost their own way in particular, but they sure lost mine.
The Fabian Society, which dates back to 1884, was named after Roman emperor Fabius, known for what one side called a lack of decisiveness and the other a contemplative nature. The Society members picked the man because they aim(ed) at slow-mo socialism. They had guys like HG Wells and George Bernard Shaw among their early hono(u)red crew, and those are fine authors, nothing wrong there.
And of course they have succeeded in the slow-mo part: Britain is still not a socialist nation. And we do have to note that 140 years ago the word socialism didn’t carry with it the same ring or feel or odor it does now. But I have to admit, reading up on history and seeing that Tony Blair and Gordon Brown are among the more prominent recent acquisitions (Oh yes, the Fabian Society was instrumental in founding the UK Labo(u)r Party in 1900, and has been “a forum for New Labour ideas and for critical approaches from across the party” ever since) does not make me feel any more balanced, or happy, or prone to forgiveness..
But that’s just me, and after all, let’s call a spade a spade, the Fabian Society issued a report, and I did not. Hey, I don’t even dislike socialism just for the kick of it, you should see what some Americans have to say … Me, I merely think we need a better division of what we have or we’re going to battle in a bad way. And there’s no reason: we have so much, and it’s till not ever enough. We’re going to have our children die over what’s much more than enough.
The Guardian gave the report a write up (two, actually), and I tried to make sense of what they said.
Living standards should become the central measure of Britain’s economic performance, according to a Fabian Society report which recommends a complete overhaul of how success is measured. [..] “What we measure – and how we measure it – matters. The financial crisis proved that simply targeting the headline goals of GDP growth, unemployment and inflation was totally inadequate as these measures failed to identify major economic weaknesses as they emerged.”
Andrew Harrop, general secretary of the Fabian Society, said the report was an attempt to show what real economic success would look like in 2020 for the administration elected in 2015. He said median household income, currently at 2002-03 levels, should replace gross domestic product as the central determinant of economic progress. “Next week George Osborne will stand at the dispatch box with the latest statistics on Britain’s economic performance,” Harrop said. “But despite the better headline news, this Fabian research reveals huge problems remain, including rising inequality, falling living standards and an unbalanced, unsustainable version of recovery.”
Obviously, I fully agree that “simply targeting the headline goals of GDP growth, unemployment and inflation is totally inadequate”. But I cringe whenever anyone talks of “an unbalanced, unsustainable version of recovery.” Because my first thought is: What Recovery? When someone, let alone an entire Society – Capital S – takes the fact that there is a recovery for granted, I find that, let’s say, a shame.
“… the 20 measures identified by the thinktank had been chosen to reflect the direction the economy needed if it was to achieve fairness, sustainability and long-term prosperity. “By making median income the headline economic indicator we will be able to go beyond GDP and measure how far national economic performance is feeding through into rising living standards for typical households.”
I got to tell you, when I first saw the term “sustainability” pop up in the article, I got a dark feeling. And the little man inside didn’t disappoint: what these people mean when they say “sustainability” in effect comes down to “sustainable growth”. And we all know there’s no such thing. We all do and they do not. They have an opaque notion of keeping the economic system alive as it has “come to fruition” during their existence , only with a slightly different way of divvying up the spoils and the loot. But don’t take my word for it.
The Fabian report says shared prosperity should be the headline measure of success, with the aim of increasing median household income by 2.2% a year. Other indicators should include reducing the national debt, reducing poverty, the de-carbonisation of the economy, increasing the supply of affordable housing and reducing the current account deficit. “Despite the recent good news on GDP growth and employment, our indicators suggest that, as things stand, Britain could be drifting towards long-term economic decline: the nation lacks the saving and investment to boost long-term growth, is scarred by an unequal and unstable economic model and remains at risk of staggering from crisis to crisis,”
Right, “increasing median household income by 2.2% a year”. Now, I’m asking: why? The Brits don’t have enough yet? I can understand wanting to raise the incomes of the poorest, but why the median? Why start off by thinking that the pie is going to keep growing and all you have to do is tweak the way it’s cut? There’s lots of lofty goals in there that everyone would say yes to, reducing the national debt, reducing poverty, reducing the current account deficit, but they zilch to do with social fairness. If they adhere to the growth model, both left and right can reduce those, albeit in somewhat different ways and gradations. I call that useless.
Let’s take a few of the 20 points the Fabians hold up as things to aim for:
• Median household incomes: Target: Average 2.2% rise in incomes per year.
Been there done that: why do incomes have to grow when a nation is already rich beyond belief? We don’t even know what we want to grow into, we spend a large part of our money on things we don’t need, and every Brit could be very comfy if wealth were divided just a tad differently.
• Greener economy: Target: Cut emissions by 80% between 1990 and 2050.
Whenever you see the 2050 date, ignore it: it’s used exclusively to make you fall asleep and stop paying attention. Whether any cuts will still be of use 36 years from now is anyone’s guess. So you either cut right now or you hold your horses.
National debt: Target: Public debt should be returned to pre-crisis levels of 40% of GDP, but over decades, with “the precise goal less important than the direction of travel.”
In other words: if we have so much left we don’t know what to do with it anymore, we’ll pay of some debt. In even more “other” words: the bond markets will tell us when and how and how much. And we’ll all say we had no idea.
Income inequality: Poverty must be reduced further to enable people to live adequately and take part in society. The number living in relative poverty fell from 20% of the population in 1997-98 to 16% in 2010-11. But child poverty fell from 27% to 18% – missing an interim target outlined in the Child Poverty Act.
Target: Cut the relative poverty rate to 10%, both for children and the wider population.
Look, if you want to fight rising inequality, then relative poverty is either not a very good measure, or the best you can get. It depends what you want to achieve. In a situation where everyone’s starving, relative poverty is very low. As it is in most of Monaco. That makes it a non-number: if you want to help the poor, you have to aim for absolute poverty, not relative.
Low pay: The incidence of low pay – defined in 2012 as below £7.44 an hour – has been stable since the late 1980s at about 21% of the workforce, despite the introduction of the minimum wage – keeping households on low incomes and increasing reliance on social security.
Target: Reduce the incidence of low pay to 17% of the workforce – the level achieved in the 1970s after the Equal Pay Act.
Fabian’s solution: keep 17% of Brits at less than £7.44 an hour. What does that achieve exactly? While banker’s bonuses keep rising? Whose side are these guys on?
Employment rate: Raising the rate will support growth and increase average incomes, reducing pressure on the tax and benefit system. Employment has been more resilient than expected during the crisis. Between 2001 and 2008 the rate was 73% among 16- to 64-year-olds. It is currently 72.1%.
Target: Restore pre-crisis levels of employment in the short term, but achieve closer to 80% employment in the longer term.
Fabian’s solution: keep 20% of Brits unemployed. Whether they like it or not. These people are not just useless, they’re wolf in sheep’s clothing. Which, credit wher it’s due, happens to be their symbol.
Please don’t let this sort of mud get your hopes up for a better society. It’s not going to come from these folk. They’ll be happy to lead your kids straight into war.
