Tuesday, 22 February 2011

The Welfare isn’t-Working Group [updated]

The Welfare Working Group reports today, and already rumours have been leaked about what it’s going to recommend.

What it needs to recommend is something drastic. In a country of four million people, there are 356,000 working age people and 220,000 children existing under the state’s welfare umbrella. Well over half-a million souls! than

That is unsustainable economically, culturally, and just in basic human terms.

But will the Working Group offer anything to change it?

I doubt it.

They won’t be changing the notion that the government is our brothers’ keepers—and our wallets are the governments to do with what they wish.

They won’t be changing the idea of “charity” by compulsion.

They won’t be challenging the idea that people should be responsible for their choices.

In other words, they won’t be challenging the system responsible for more than half the money government (over) spends.

But they might do something. They might do something to wean some children off welfare, and arrest some of the culture of intergenerational dependency.

They might.

They might, for example, as has already been leaked, require that solo parents on the DPB start work once their youngest reaches three—a good first start.

But the opponents of this recommendation, and of every other recommendation, have a point—and it’s not something the Welfare Working Group can do anything about, and nor is it something the government will do anything about.

Opponents say that there are no jobs, there is no affordable day care, and that costs to low-income folk are going through the roof.

And they’re right.

They’re right there is no affordable day care—there is no affordable day care because the occupational licensing of day-care providers and their staff has sent the costs of day-care provision through the roof. (Not to mention the cost of building a day-care facility.)

But the government will not be doing anything to change that.

They’re right that food prices are going through the roof—and they’re going through the roof because of the ridiculous sponsorship by international governments of so-called biofuels (which takes valuable land out of food production) and because of the US government’s stimulus packages, which have inflated international commodities (like milk and oil).

But the government will not be doing anything to change that.

They’re right that there are very few jobs around at the moment—and there are very few jobs around at the moment because the cost to businesses of creating an unskilled job is too high, much higher than the amount an unskilled staff member can produce.

But the government will not be doing anything to change that either.

They won’t be doing anything to change anything fundamentally.

They won’t be changing the government schools that continue to pump out youngsters who can’t read or write, and will never gain the skills to be anything but an unskilled employee at best.

They won’t be changing the Resource Management Act or the occupational licensing requirements that mean day-care providers must satisfy rigorous regulations and Resource Management Act requirements to open (restrictions that don’t come cheap), and to be staffed with degree-holders in order to stay open (and degree-holders don’t come cheap either, if you can find them).

They won’t be challenging the idea that “economic stimulus” is good, even though worldwide it is inflating the prices of everything from food to building materials. (It’s not just a local problem. What do you think started the rioting around the Middle East?)

They won’t be changing the pro-union legislation, occupational licensing and minimum wage laws that both push up the costs of employment and push down the productivity of those employed—and that between them raise the barrier for entry to the work force for everyone, especially the unskilled and semi-skilled; that virtually guarantee that labour markets will never clear; and essentially ensure that a huge pool of permanently unemployed will be permanently with us.

And they won’t be removing the handbrake of red tape, regulation and taxes that strangles every single business in this country (not to mention that big red handbrake called the Emissions Tax Scam), and at the moment means every business is focussed on its own economic survival rather than helping to create new jobs.

They won’t be removing the handbrake of red tape, regulation and taxes because the government itself needs them, because it needs the people who needs them (it thrives on them!), and because people keep voting for them—even the people whom it harms. They keep voting for a system that strangles businesses, stifles new jobs, discourages saving and new investment, keeps down real wages … and sees government consuming nearly half of what local businesses produce—even though that system itself is what keeps so many of those voters themselves in poverty.

So in the end, whatever is recommended today, the government won’t be doing anything to change anything. Not fundamentally, they won’t.

Why would they?

UPDATE: Can’t say I disagree with this prediction by Dim Post’s Danyl:

_Quote Like almost everything this government does, ‘welfare reform’ will be a political advertising campaign and nothing more.

Doesn’t mean they won’t be lapping up the do-nothingness in No Minister circles.


  1. Well written post Peter.

  2. I'm amazed at the level of cheer-leading for National from Adolf and No Minister bloggers. Your points are being well argued here Peter, but No Minister is a disgrace to be called a right wing blog.

  3. Given the UK is getting the same, what's a bet NZ's reforms will be less ambitious than the UK ones, which is like arguing over whether to change one or two peas on a dinner plate.


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