Tuesday, January 03, 2012

Why Liam Byrne is Misleading on the Beveridge Settlement

Beveridge shored up the ruling class by proposing concessions to workers
Seventy years ago, William Beveridge's Report of the Inter-Departmental Committee on Social Insurance and Allied Services was presented to Parliament. The Report had a huge influence on policy, effectively providing a blueprint for the social democratic 'welfare state'. Though far from a revolutionary document, it still proposed far-reaching reforms, which were huge concessions to the working class following the struggles of the first Great Depression and World War Two.

Yesterday, current Shadow Secretary of State for Work and Pensions and former Cabinet minister Liam Byrne used the occasion to position Labour as being - if anything - to the right of the Conservative/Lib Dem coalition, as they seek to finally dismantle the Beveridge settlement. In doing so, he absurdly suggested he was the political heir of Beveridge, who he claims "would have wanted determined action from government to get communities working once again".

During the early 1940s, ruling class figures were gripped with fear that - should Britain come out on the winning side during the war - the returning working class soldiers would expect the kind of "land fit for heroes" falsely promised during World War One. The mass struggles of the 1930s had shown that this was a very real possibility, and of course the example - debased as it was - of "actually existing socialism" in Eastern Europe provided an alternative flag for workers to rally behind. At the time, even Conservatives agreed that society needed to be restructured, because - as Quintin Hogg MP put it - "We must give them reforms or they will give us revolution".

With this in mind, Beveridge identified five "Giant Evils" in society - squalor, ignorance, want, idleness and disease. Squalor was to be combated by the largescale construction of good quality council housing, "ignorance" by the introduction of comprehensive schooling, "want" by a benefits system, "idleness" by significant government intervention in the economy, and disease by what would be named the National Health Service.

As it transpired, Beveridge's recommendations - which chimed with the Keynesian economics then fashionable in ruling class circles - were enough to buy off British workers, and revolution was averted. However, bit by bit - and especially after the financial crises of the 1970s - governments of all shades have sought to overturn the post war social democratic settlement. The attacks spearheaded by the current government are aimed at finally bringing down the social democratic giant who was Beveridge.

The Beveridge Report boosted working class morale during WWII
And yet the Labour Party still has to present itself as an alternative government, should the coalition be brought down before its full term for instance. Byrne is a key figure in the party's attempt to rebrand itself yet again, as 'New Labour' becomes the even more right wing 'Blue Labour'. In his Guardian article, Byrne praises Beveridge in order to bury him.

According to Byrne, Beveridge:
"[...] would have wanted reform that was tough-minded, and asked everyone to work hard to find a job. He would have worried about the ways that his system had skewed social behaviour because he intended benefits to help people who had their earning power interrupted because of illness, industrial injury or the capriciousness of the trade cycle. He never foresaw unearned support as desirable."
As yet, Byrne proposes nothing concrete. But his words tend towards further stigmatisation of unemployed people, and almost entirely let both the current government, his own, and the several preceding it off the hook where the giant evil of "idleness" is concerned.

Beveridge certainly didn't intend that people should be able to become 'scroungers' - in today's terminology - after his benefits system was introduced. Indeed, that's why he insisted that benefits should be set so low as to deter people from living off them, and they are now worth relatively less with each passing year. However, he also believed that the government should always ensure that there was enough paid work out there for those who were fit and able to do it.

In his later Full Employment in a Free Society, Beveridge declared that individual employers were not capable of creating full employment, so that was the duty of the state. Unemployment should be kept to 3%, as a check on wage demands, but it should be allowed no higher. This policy was officially pursued by governments for decades, until Labour's James Callaghan and - more decisively - Margaret Thatcher put an end to it. Spurred on by economic globalisation, governments from the 1980s onwards would pursue 'free market' reforms aimed at reducing wage costs and therefore increasing profitability for the ruling class.

By posing the supposed necessity of "another tough-minded social revolution", Byrne promotes himself as a man who would take the reactionary attacks of Iain Duncan Smith even further. In the midst of this new great depression, the official UK unemployment count is at 2.64 million, and that figure is set to rise far higher in 2012. There are 5.7 officially unemployed people per vacancy, and of course many jobs go to those who are already in work, so long term unemployment is worsening. Despite their bluster about us all being in it together, this is great news for rulers who profit from working class misery. Indeed, Byrne's article shows he believes the levels of "want" are simply not high enough.
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