Can the welfare state survive?

Earlier this week Andrew Gamble did a seminar at Manchester on his new book, Can the Welfare State Survive? It’s hardlly a spoiler to say he answers, yes, it can and must.

The book starts with some observations on the historical origins of the welfare state, and the various motives for its creation – the moral imperative, the practical need for a healthy workforce, the pragmatism of capitalism averting more radical political responses. Then it separates the challenges to the existing welfare state into four categories: affordability and the political unwillingness to pay taxes; the forces of globalisation affecting the tax base and business decisions about where to employ people; the ageing population making growing demands on the welfare state; and what he calls ‘new social risks’, which includes structural social and economic changes such as women’s changed expectations about work and family life, new patterns of working, the transition to services and intangibles and so on.

Despite this array of challenges, the book argues that the welfare state will adapt and survive because if it does not, then capitalism won’t and can’t survive. I too have great respect for the ability of capitalist democracies to adapt, and to ensure there are institutions to benefit the majority of people, often in just the nick of time to avoid revolution. Yet the book – not surprisingly for such a short one – does not engage fully with the problem that the welfare state we have does not actually do a good job, and yet it is hard to see a political path from the dysfunction of today to a better model of insurance against aggregate risks tomorrow. Today’s structures are built around the breadwinner, the traditional family, long periods of conventional employment in a company that will be around for a long time to deliver many of the policies of the welfare state. Nor is there any sign of this changing. The latest pensions and apprenticeships policies are to be delivered by companies. The new welfare state will have to be shaped around individuals taking a myriad of different paths through life. Otherwise even the people it is supposed to be protecting will find other ways, and support for paying for the ‘welfare state’ will decline further.

Can The Welfare State Survive? presents a nice overview of the issues, nevertheless, and I do agree that the moral and practical cases for it remain strong. The challenges to the welfare state are political, and paradoxically are posed more by its ostensible defenders who do not want anything to change.

This book, by the way, is one of another new series of short, polemical series, competing with my own Perspectives, and one from Palgrave in which my esteemed colleague Adam Ozanne has a new book out, Power and Neoclassical Economics (albeit with a mad price of £45 for 110 pages). There are lots of others. Despite – or rather because of! – the competition, I think this is a healthy phenomenon, a sign of the hunger for ideas and debate.

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It’s all about the students

I’ve zipped through Les Back’s very enjoyable book Academic Diary: Or Why Higher Education Still Matters (the inaugural title from Goldsmith’s Press, always pleasing to welcome a new publisher of intelligent non-fiction). The book, the descendant of an earlier online version, is a kind of field notes about the academic life. Although I don’t entirely share his sense of the decline of the academic vocation and the role of universities – more on this below – it’s a warm, interesting read making a lot of wise observations.

 The book has a lot to say about writing, and I’m wholly in accord with Les Back on this subject. On the obscurantism of academic writing when it isn’t necessary (occasionally it is). On the importance of reading for writing. On the merits of George Orwell’s Politics and the English Language. On having a stationery fetish (oh yes!). On the joy of libraries – that serendipity of taking a book off the shelf, and its immediate neighbours calling out, ‘If you’re interested in that one, you’ll want to read me too’ – something unavailable online where the serendipity has a very different structure. On the kinetics of writing by hand in a notebook. On desks – & I discovered here there is a book of photographs by Jill Krementz called The Writer’s Desk.

There are sections of wise advice about the job: supervising doctoral students; marking exams; invigilating; dealing with administrators. I particularly liked Back’s emphasis on the importance of teaching, and the need to be interested in students’ ideas; the incentive structure is changing a bit, but there is no doubt that for people who choose academia as their career, the incentives are all to get the right kinds of research published in the right journals. It has to be done to get hired and be promoted. But it damages the true life of the mind and the purpose of universities – especially in my subject, as the lock a very small number of top journals have on the REF process in economics (and equivalent assessment processes in other countries) has warped the character of the research done and therefore the subject. You get rewarded for small and technically-sparkly tweaks to the existing body of work. I meet some academic economists who remind me a bit of the prisoner in the movie Colditz who pretends to be mad to get out and ends up in fact becoming insane. They pretend to care about the highly abstract models to get papers published, and then that ends up being what they think is their purpose in life. Talking to students is a great source of immunity from the scholasticism.

So on to my small reservations about Academic Diary. I’ve only had my academic perch for a couple of years, and it is indeed a very odd environment compared with my other work experiences. Still, I’m less sure than Back that all the recent changes have been terrible. Of course the REF has had serious counterproductive consequences, but holding researchers to account for their research must be right, and similarly now requiring them (social scientists!) to think about impact. By all means improve the mechanisms, but the principle is surely correct. Universities do indeed seem extremely bureaucratic, but they could hardly remain the only important institutions that do not need to change in the face of technology, demographic trends, and political demands; or refuse to improve their accountability to a much-changed student body. So are there many things wrong with universities and the academic life? Yes. But I’m not persuaded the good old days were really all that good except in providing academics with a more comfortable life. Still, I’m sure lots of academics will love reading this book and will share his take on the issues. And with Les Back, I very much agree that higher education still matters, in fact more than ever as the value of institutions enabling face-to-face engagement increases.

People and property prices

Rowan Moore’s Slow Burn City: London in the 21st Century is a sort of lament for London, which the book praises for its vibrant, cosmopolitan, energetic, creative dynamism – and portrays as destroying the foundations of this success. The reason for this is obvious: the fact that successive governments have allowed global capital to turn the city into a safe deposit box of property, making it too expensive for most Londoners to buy or even rent a home in, and steadily emptying out the city.

The early chapters give examples of the kind of home building that took place in London in previous generations, the mix of private speculation and public policy that created millions of homes. This was clearly a mixed record but the book argues that little of that was to do with the architecture and planning of the now-notorious post-war to 1960s council estates, and much with social and economic policies. One testament to that is the way those much-criticised flats have joined the market for desirable properties, even in the now-hipste East End. What’s more, as Moore writes: “When riots took place in the Victorian streets of Brixton, nobody blamed the architecture.”

Some of the argument is familiar but I learned new things – for example that until 1951 housing was the responsibility of the Ministry of Health; and that John Stuart Mill had been one of the leading campaigners for keeping London’s parks open and public. The book is a good read and is packed with pictures well selected to illustrate the arguments.

When it comes to the present day, the book sees government welfare policy – keenly implemented by the recently-departed Iain Duncan Smith – as wholly topsy turvy. The government asks why taxpayers should subsidise benefit claimants to live in London. “This is the wrong question – what should be challenged is why living in London has become a luxiry item, even for modest homes in unglamorous areas, and for people who have spent their lives in the city.” He correctly points out that the private market will not fix the housing crisis because private developers will never build more than they can sell quickly, and will never increase supply enough to bring prices down. In a very apt term, he says London is suffering from the ‘necrotizing fasciitis of residential value.’

The fortunes of cities rise and fall. London’s fortunes will decline now unless it fixes the housing crisis. Only the rich can afford to buy homes in the city now – even young professionals cannot get on the housing ladder, never mind teachers and cleaners and baristas; and too many of the purchasers are overseas investors with no interest in the life of the city. Moore ends the book with a manifesto which  sits alongside others including Bridget Rosewell’s Reinventing London and Kate Barker’s Housing: Where’s The Plan. The ideas are both sensible and depressingly idealistic in the sense that one cannot see this government – or any realistic alternative – agreeing on the need for the social building of new homes, including on some green belt, on a scale that will lead to a decline in prices. But without people, a mixture of people from the entire social scale, a city is a museum, not an economic dynamo.

Bringing reason to readers

A modest benefit of our ‘interesting’ times is that the world of ideas is flourishing. This is good news for readers – all the books, the explosion of interesting things to read online – and for the publishers who care about ideas.Feeding the demand for understanding was the thinking behind my own modest publishing effort, the LPP Perspectives series.

It is very cheering to see some university presses responding to the demand among the wider public, not just academics, for serious thought. And what’s more, some are thriving on it too. I wrote about this after the last meeting of Princeton University Press’s European Advisory Board, of which I’m a member. Today and yesterday there has been the first conference in the UK organised by the Association of American University Presses, with many UK university presses participating, as well as American ones. This includes a brand new UK university press, Goldsmiths Press – who sent me this week one of their first titles which looks a must read for all disgruntled (ie. all) British academics, Les Back’s Academic Diary (Or Why Higher Education Still Matters).

As a recent article in the Bookseller points out, times are challenging for university presses, caught between the rough and tumble of commercial publishing and the rough and tumble of higher education. But I agree with the conclusion that these are good times for publishers encouraging the public engagement of scholars – perhaps precisely because they are not such good times for the world. People are demanding debate and there is a responsibility on academics, and their publishers, to supply reason and evidence amid the demagoguery out there.

Big books on the big question

I’ve nearly finished reading Deirdre McCloskey’s Bourgeois Equality: How ideas, not capital or institutions, enriched the world – it’s out next month and I will be reviewing it elsewhere. This is of course the latest in her grand project, The Bourgeois Era, the first two being The Bourgeois Virtues and Bourgeois Dignity. (I reviewed the latter in The New Statesman at the time.) McCloskey originally planned six volumes, but it seems three might now be the total. As each is over 600 pages long, this is already quite a lot.

Anyway, this isn’t a spoiler – I’ll save up my thoughts on Bourgeois Equality. But reading it set me thinking about what other books one ought to have read to evaluate properly this series about the history and dynamics of capitalism (although McCloskey doesn’t like the word). These are the ones that came to mind first – and clearly this is a question that inspires BIG books.

David Landes, The Wealth and Poverty of Nations.

Kenneth Pomeranz, The Great Divergence

Joel Mokyr, The Lever of Riches; The Gifts of Athena; The Enlightened Economy

Robert Allen, The British Industrial Revolution in Global Perspective

Jared Diamond, Guns, Germs and Steel

Ian Morris, Why the West Rules – For Now

Acemoglu and Robinson, Why Nations Fail

Douglass North, The Rise of the Western World 

Joseph Tainter, The Collapse of Complex Societies

I’m sure there are tons more – McCloskey’s bibliography alone is 50 pages long. But anything essential left off this list?