360° Analysis

Great British Reforms Under Great International Attention: Part 3


July 15, 2012 09:30 EDT

An analysis and commentary on the social, economic, and political dissonance in Britain and the related attempts at reform underway. This is the last in a series of three articles. Read part 1 here and part 2 here.

Socio-economic Change

Britain’s social problems are economic as well as cultural. Britain is not a land of equal opportunity, although nor is it the land without opportunity that the idle and the criminal like to complain of.

Inherited privileges continue to divide society, but these are not as important as the privileges of the political elite. However privileged you were born, the best way to wealth, power, or influence in Britain during the last decade or so, had been politics.

Members from all parties are guilty of shocking corruption: in 2009, leaked “parliamentary expenses” declarations exposed a system of generous reimbursements for bogus “expenses” such as duck houses on private ponds and rents paid to family and friends. Almost all politicians exploited the system, but few suffered any rebuke.

Meanwhile, politicians are at the center of an enormous network of privileged public servants and private sectors. In the last two decades, Britain has recognized a new elite of “spin doctors” (political marketers), “quangos” (quasi-nongovernmental organizations, with powers to regulate private sectors and public services, but with little accountability), “think tanks” (most of them founded or funded by political parties), journalists with partisan editorial agendas, and public servants. Civil servants and military and police commanders have traded favorable comments on the ruling party or policies in return for promotion, despite an official policy that public servants should be non-partisan in their work.

New politicized institutions gave the ruling party more opportunities to reward its preferred supporters with employment and lucrative access, creating an increasingly incestuous network. This is perhaps no worse today than in the past, but its exposure has shocked Britons.

The most tarnished private sectors relate to newspapers and television channels, whose ownership is highly consolidated in Britain. In 2011, the drip-drip of revelations about the cozy relationship between journalists, police, and politicians finally led to tardy investigations (still ongoing) into illegal payments made to police for information, intimidation of witnesses, hacking of phone and email accounts, and favors traded between politicians and news media owners and editors.

The Conservative Party criticized the Labour government, but has been found immersed in this itself. For instance, Andy Coulson edited the News of the World newspaper from 2003 until his resignation in 2007 over allegations of phone hacking, but David Cameron appointed him Director of Communications. In January 2011, Coulson resigned after more revelations about phone hacking, and has since faced criminal charges. The current Levinson enquiry into press conduct has revealed that previous and current administrations maintained intimate friendships with editors and proprietors (the most powerful was Rupert Murdoch) despite conflicts of interest over mergers and licenses and suchlike, implicitly in return for favorable press coverage.

After the news media, the banking sector is probably the most privileged sector in Britain. The Labour government, despite its roots in socialism and manufacturing, prided itself on its “light touch” regulation of banks; having taken credit for the revenues, it had to take blame for Britain’s over-exposure to the banking crash in 2008. That same Labour government then bailed out those same banks, with few guarantees from the banking sector. The banks soon bounced back with huge profits that they were not obliged to use to pay back the government. Popular disgust at the unaccountable bonuses of bankers encouraged some critics to urge the government to recover the debt through tax or even expropriation, but the current government was indecisive. Belatedly, in summer 2012, it proposed increased powers for shareholders. This proposal preceded findings in June about manipulation of the inter-bank lending rate and fraudulent selling of un-needed services (often bundled with common loans). The Financial Services Authority imposed fines, but these were trivial next to profits, while it claimed that it has limited powers to fine banks for breaking the rules and no powers to punish persons. It eventually passed the buck to the Serious Fraud Office, which was unprepared, although it eventually concluded that it could open criminal investigations.

Academia too was corrupted. With public institutions restricted in how much they can charge domestic students, most higher education institutions remain dependent on corporate sponsorship and public funds and contracts, with some departments, particularly of social sciences, attracting public spending for politically agreeable teaching or research on defense, health, social services, the economy, and education. Some universities made regrettable decisions in pursuit of foreign money. For instance, the London School of Economics accepted millions of pounds from the late dictator of Libya, Muammar Ghaddafi. In return, it organized fora on campus for the “Brother Leader”, produced sympathetic commentary, and awarded a doctoral degree to his son (Saif al-Islam), even though he contributed little work. All of this helped to justify the Blair government’s unscrupulous normalization of relations with his regime.

Incidentally, education below the university level is under reform, mostly because of a collapse in confidence in the examination systems. Once privatized, examining boards inflated grades and coached teachers on likely exam questions in order to compete for clients. Meanwhile, they became increasingly expensive until schools complained that they were entering students for fewer exams – presumably, poorer students suffer most. Employers complain that school leavers lack the necessary numeracy and literacy for basic business; universities complain that they cannot differentiate between applicants who all have A grades; yet employers blame universities for turning out too many students with useless degrees. The current government has proposed to introduce more difficult examinations in more traditional subjects.

The barriers to socio-economic mobility in Britain are high, mostly due to the high cost of real estate, particularly wherever desirable jobs, entertainment, or transportation are concentrated. Britain is a wonderful place to live if you inherited property in the countryside or if you hold your assets, for tax purposes, offshore and still enjoy all the privileges of metropolitan Britain. But unless you inherit a house in Britain, chances are you never will get on the property ladder. Extreme restrictions on residential construction preserve the beautiful countryside but leave Britain short of housing.

Urban campaigners are correct to campaign for new towns and easier planning laws, but rural residents are correct to campaign for less migration into existing urban areas. Immigration puts pressure on mostly urban infrastructure, for which the typical rural resident pays more but uses less. These costs drive many of the rural complaints about immigration. These complaints sound odd or even racist when driving through vast swathes of green and pleasant land, populated mostly by whites, but almost all of it is closed to development, while most urban authorities cannot provide housing for all those officially entitled and have turned to moving dependents out of towns.

While Britain certainly is not a land of equal opportunity, perversely, Britain is also a land of opportunities for the least deserving, including the idle, the irresponsible, the illegal, and the radical.

Some Britons choose to exploit a legacy of entitlements that can permit a lifetime of idleness. Although these benefits do not add up to a comfortable living for most, the coalition government has revealed that an unemployed single parent with a few children can claim benefits with a collective value in excess of the average working family’s income. At the end of the Labour government, most adult Britons were receiving at least one public benefit. Public payments of private property rents, however expensive the neighborhood, are probably the most valuable benefits. These contribute to the inflated cost of housing and, according to the Prime Minister, encourage a culture of idleness. In June, he announced his intent to cut automatic housing payments for those aged under 25 in solidarity with those who choose to live with parents or on their own means.

Most benefits are not policed in any consequential way. Instead, the government controls costs in perverse ways, for instance, by denying Job Seeker’s Allowance to a worker whose National Insurance Contributions (essentially a tax on income) in the previous two years were insufficient, while someone who never worked (and denies any outside support) is guaranteed indefinite Income Support on the grounds of need.

The colossal expense of accommodating the whims of the least deserving leaves less money for truly constructive benefits, such as re-training the unemployed, solving refugee crises, encouraging healthier behavior, or enforcing rights fairly.

Amazingly, illegal immigrants can be entitled to the same benefits, even if they admit illegal entry, particularly if their country of origin is regarded as unsafe or unknown. They often destroy their identities in order to claim an unsafe origin. Determined illegal immigrants get into Britain eventually; given easier borders and human rights protections, illegal immigrants can break into secure ports and trucks or trains repeatedly with little consequence until they gain entry into Britain. Foreigners can also exploit the system as tourists, travelling into Britain legitimately for free health treatment while ill or pregnant, before returning home without liabilities. Again the government corrects for these abuses in perverse ways, most infamously by refusing some legitimate asylum seekers while not searching for illegal residents at all.

Most Britons want to curb immigration. Others claim that anti-immigration is racism, but the detailed surveys show that most Britons are not racist but oppose the consequences of carelessly-managed immigration: self-segregated communities that strain the public purse and patience with demands for more privileges but less intrusion. The Labour Party leader (Ed Milliband) admitted in June that the Labour government had mishandled immigration and promised to reinvigorate his party’s legacy policy of “British jobs for British workers” by, for instance, cracking down on positive discrimination within immigrant communities.

British multi-culturalism is exciting and creative, but in places it is also conservative and anti-social. Some of these communities are closed by their own volition – they have inflated their differences, self-segregated, and blamed the majority. Some communities maintain English as their second language and explicitly place their loyalties to ethnic or religious diasporas higher than to Britain. Some demographic identities are clearly exploiting differences for socioeconomic gain. For instance, traditional “travelers” used to travel as single families, plying their trades along the way and staying on roadside verges or wasteland, but Britain now has massed communities of hundreds of “travelers” who tenuously claim a minority ethnic identity and a vagrant culture as excuses for illegal residency on unsecured land, without paying resident taxes, while demanding that local authorities supply them with free land and services. Real Gypsies find these mass, mostly sedentary communities, with all their modern conveniences, inauthentic, but real Gypsies get little attention.

Abuse of the privileges of living in Britain by the idle, the irresponsible, the illegal, and the radical encourages resentment from most Britons who have played by the rules but have seen disappointing rewards. The most resentful is the middle class, which receives few of the benefits enjoyed by the truly idle and irresponsible, pays most of the taxes that the offshore rich and the travelers avoid, does not inherit the property enjoyed by the old elite, and does not get the political attention garnered by criminal agitators. When surveyed, most Britons now agree that Britain is not a country that rewards people who play by the rules.

Further sources of frustration are the blatant privileges allowed certain demographics, more often than not to right perceived previous wrongs. Official concerns for the human rights of travelers often mean that authorities cannot move illegal camps, so human rights trump property rights. Britain has strong laws protecting animals, but allows people, on religious grounds, to avoid legal requirements to slaughter humanely. Many purveyors of meat (nobody knows how many) choose to stock only Halal meat on the grounds of efficiency, but are under no obligation to tell their customers. Consequently, most Britons probably have eaten Halal meat unknowingly, even though most Britons consider the process of creating it barbaric. Some behaviors, such as forced marriage and “honour killings”, are illegal in Britain whatever the religious grounds, but authorities have struggled to prosecute when communities are uncooperative or protected by officials who fret about cultural imperialism, prompting the current government to propose specific laws against them.

In the 1990s, so strong was the hysteria over “dead-beat Dads” and income disparities by gender, that in following years family courts tended to award to wives more than half of the family’s worth and custody of the children, while the Child Support Agency enforced child support payments by only fathers, even if mothers were worth more money, remarried, or frustrated the father’s access to the children. Thankfully for campaigners like “Fathers for Justice”, the current government has announced its intention to bring gender neutrality to family law.

Since Britain’s socio-economic problems, like Europe’s problems generally, have increased despite increasing political representation and economic participation, calls for more democracy or economic growth are misplaced. Common themes in Britain’s social changes over the last two decades or so are declining accountability, meritocracy, and fairness, often because democratic processes or economic advantages are captured by minor but politically powerful interest groups.

Reversing these trends should be the objectives of all reforms. Politicians should start with higher accountability for themselves, more judicial enforcement of the existing standards that politicians, police, journalists, and bankers have long ignored, de-politicization of the civil service and more accountability for public servants, fewer quangos, an academia less dependent on public funding, more rewards for the law-abiding and tax-paying, fewer bailouts for favored sectors, less public protection of private religion, and the same rights and responsibilities for all.

The views expressed in this article are the author's own and do not necessarily reflect Fair Observer’s editorial policy.


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