Poverty & ideology

Iain Duncan Smith wants to shift the definition of child poverty from one based upon low incomes to one based on educational attainment, worklessness and addiction.

What's at stake here is, as Amelia Gentleman points out, an ideological issue: is poverty due to individual failings or to the structure of society?

Of course, some parents of poor children are feckless workshy druggies. But in a population of 64.6 million people, pretty much anything is true of someone.

Two big facts, however, suggest that the link between child poverty and parental failure is weak. One comes from the DWP's own report:

Children  in  families where at least one adult was in work made up around 64 per cent of all children  in  low  income  [before housing costs]  in  2013/14 (p46 of this pdf).

Think what it means to be in work. It means you've impressed an employer sufficiently to get hired, and you are managing to turn up roughly on time most days. You have, in short, got your shit together. And yet you're still unable to get your family out of relative poverty.

Secondly, Andrew Dickerson and Gurleen Popli point out that there is zero correlation between material child poverty and a measure of parental involvement based upon facts such as whether parents read to their children or given them regular meal times and bed times. There is, therefore, no link between bad parenting (on this measure) and material poverty.

These two facts suggest another, bigger reason for child poverty. Quite simply, it has become harder for less skilled people to provide for their families. For someone at the 25th percentile of weekly wages, real wages are 6% lower now than they were as far back as 1997*.

In this sense, obstinately high child poverty has its roots in developments in the labour market. Whether it be because of mass unemployment**, deindustialization, the offshoring of low-skilled work, technical change or whatever, the fact is that things have gotten tougher for what used to be called the respectable poor in the last 40-odd years.

It is this fact that Duncan Smith seems to want to gloss over. From the point of view of the ruling class, it is better to question the character of the poor than the health of capitalism. And, sadly, I fear he might succeed in this aim: the egocentric bias means many voters like to think well of themselves and hence less well of others. There will therefore be an audience for slanders against the poor.

However, facts are facts however you try to change the language. You can define your cow as a horse but it still won't win the Derby.

* According to ASHE, gross weekly earnings for the 25th percentile have risen 53.6% since 1997 (when their data begins) whilst the RPI has risen 63.6%: I suspect RPI is a better measure than CPI as it includes housing costs.   

** There are 1.81 million officially unemployed, plus 1.3m part-timer workers who want full-time work, plus 2.34m economically "inactive" who want a job. That's a total of 5.45 million.   

Another thing: insofar as some poor parents are lazy, there's a question of endogeneity: is the laziness a cause of poverty or is it instead an adaptive preference - a response to their belief that they can't find work?   

Comments

[Phil]

"From the point of view of the ruling class, it is better to question the character of the poor than the health of capitalism."

'Twas not ever thus - see discussion on my blog:
https://gapingsilence.wordpress.com/2015/07/01/the-times-they-are-hard/
http://gapingsilence.wordpress.com/2015/07/01/and-the-wages-are-poor/.

But 'tis certainly thus these days - for much of the Labour Party as well as the Tories.

[e]

Yes that's right, on all counts; and it's definitely adaptive – requires les of everything.

[BCFG]

Ian Duncan Smith is the absolute embodiment of banal evil. Dickens could not have come up with a more venal and debased character.

The strange thing from a political point of view is this, why can't Labour simply revert back to the old measure when they get into power. Why do these new measures generally seem to persist?

[Keith]

When you fail change the definition of success. What a twat IDs is and his party.

[Charles Barry]

Hi Chris, just on your point about the wages of those at the 25th percentile.

RPI is a flawed measure as I'm sure you are aware. If you do want to use the RPI basket, you should probably use the RPIJ measure to correct for formula bias.

Conveniently, RPIJ also goes back to 1997.

RPIJ appears to have risen from 154.9 in Feb 1997 to 238.5, i.e. a 54% increase. This is the same as the ASHE increase.

So 25th percentile incomes are about the same as they were in 97 in real terms, rather than declining.

[chris]

@ Charles - you're right. A strong reason to think so is that the poor are more price-sensitive than others, & so more likely to substitute to cheaper goods when prices rise.
However, a bigger qn is: are the weights in the basket diff for the poor than average? I suspect this mitigates the RPI-RPIJ bias, if the poor spend less on goods that have fallen in price (tech goods) and mor on those that have risen (utilities).

[Kathleen]

"Of course, some parents of poor children are feckless workshy druggies"

in a post about poverty and ideology. FFS.

[Luke]

"Iain Duncan Smith wants to shift the definition of child poverty from one based upon low incomes to one based on educational attainment, worklessness and addiction."

Isn't that like trying to measure how fast someone can run by assessing how good they are at football?

[Jody]

Much poverty stems from artificial scarcity caused by deliberate government policy. 1) land use is constrained by planning rules that act to increase the cost of accommodation. 2) costs of fuel and electricity are artificially heightened by taxes to raise revenue and discourage carbon emissions. 3) costs of food are artificially increased by tariff barriers that prevent imports from developing world in order to protect (French) farmers.

These policies are endorsed by both Labour and Conservative parties. I agree with one of the three policies, but we need to recognise all three have big costs, which the poor bear most heavily

[Laban]

"Quite simply, it has become harder for less skilled people to provide for their families. ... whether it be because of mass unemployment, deindustrialisation, the offshoring of low-skilled work, technical change or whatever, the fact is that things have gotten tougher for what used to be called the respectable poor in the last 40-odd years."

I think, Chris, you've missed out mass immigration. But I forgot, supply and demand doesn't apply to the labour market (unless it's for CEOs), does it ?

[Laban]

re living costs for the poor, Terrible Tim from Tullett did some sums for 2001-2011 prices :

Gas up 168% in ten years
Electricity 97%
Property 66%
Water 63%
Council tax / rates 59%
Petrol 59%
Food 39%
Rents 28%
Consumer durables -5%
Average income up 38%
CPI inflation up 27%.

"I don't know what it tells you, but it tells me that the ONS measures of inflation, as far as the poor are concerned, are woefully inadequate. There's no doubt that 24" monitors (made in the Far East) are a fraction of their 2001 price - but how many of those do you buy a year, compared with the number of trips to the garage or supermarket you make?"

http://ukcommentators.blogspot.co.uk/2013/03/are-we-doomed.html

[Matt Moore]

Of course, in 2100, £250,000 (inflation adjusted) per year will leave a child in poverty, compared to the median of £500,000. Just think - they will only be able to afford two or three self driving cars and only one or two luxury safari holidays per year.

Redefining "poverty" to mean inequality is one of the more mendacious rhetorical cons perpetrated by the Left, in a pretty crowded field.

If Scotland had voted for independence, both the Scots and the residents of the rUK would have had dramatic falls in child "poverty", with literally no change in the standard of anyone's life. Why are arbitrary lines in the ground so important for determining who is poor?

Thinking about it, I will accept one relative definition of poverty - anyone earning less than 60% of median global income.

[Leslie48]

As with most things its the 'discourse' which dominates which wins. For Labour/centre Left actually all non-conservatives they have failed to push that poverty relates to being a 'social victim' be it redundancy, jobs decline, disability, separation, long term illness, family breakdown , accident, low wages...So the Tory Victorian, hate Mail ideology has won.

You can only remove the welfare society in England and Wales ( unlike the continent) because the Tories ideology has gone unchallenged largely supported by the most right wing press in Europe and a lapdog BBC. Labour where is your sting?

[Laban]

@Leslie48 - we've had some form of welfare society in England since medieval times, and it reached a peak in the post-war years - when social solidarity in the UK was extremely high. That solidarity's collapsed - witness the decline in membership of voluntary organisations, political parties etc.

How do you expect an atomised society to support a Welfare State ?

http://ukcommentators.blogspot.co.uk/2013/01/open-borders-make-eventual-abolition-of.html