The idea of giving the poor more money might make some rabid right wingers foam at the mouth, but it’s actually one of the best solutions to reducing inequality, and thus poverty.
A number of groups concerned about NZ’s growing inequality – and all the social problems that brings for everybody regardless of wealth – are becoming increasingly strident about the need for action as we approach another election year. Closing the Gap is no exception, says spokesperson Peter Malcolm.
“Those of us who having been trying to draw NZ’s attention to the consequences of rising inequality are getting fed up with the lack of solutions being implemented. Everyone involved in various social sectors around New Zealand knows that our lowest socio economic groups have more health problems, low quality housing and lower education outcomes because they have less money than is needed to participate fully in society.
“There is a raft of ideas that various experts have suggested but the government is reluctant to spend now to save in the long run. Instead they just shuffle funds around by tinkering at the edges.
“What poor families really need is more money. The government’s weak response is to give beneficiaries with children an extra $25 a week starting April 1st. Sure, that will help some families but it is really tip of the iceberg stuff.
“It’s time NZ politicians became bold. We need to implement innovative ideas if we are going to address the problems we have had. Taking a leaf out of Finland’s book and seriously look at implementing a universal basic income would be a good start.
“While those who live a life of privilege or have pulled themselves up by the bootstraps will cough and splutter about handouts and individual responsibility, you don’t have to be an academic to realise why research shows that poor people do better when they are given more money.
“We can all understand that a hungry, sick kid living in a crowded, un-insulated house with parents who struggle to make ends meet – whether they are beneficiaries or the working poor – is unlikely to do as well at school as someone who is well-fed, sees the doctor when sick and lives a life of relative comfort.
Closing the Gap calls on New Zealanders who care about their fellow citizens and want NZ to be a compassionate country once more to put pressure on the government to give the poor more money.
“After all,” says Malcolm, “ We all expect that we will be given enough money to live on over the age of 65 and are justifiably proud of our superannuation scheme’s universality. Why then can’t we be as generous to those at the bottom of the heap earlier in life. We will all benefit from making our society more equal.”
Although it is true that paying more money would be of help to those on low incomes, it is unlikely, in itself, to lead to meaningfully change in outcomes for those people.
It seems to me that a better approach would be to give better access to the things that are such a burden. Properly State-supported health care, education, housing, recreation and healthy food will all make a big difference for many poorer families.
In many situations, targeting and means-testing for the right to receive these resources are a wasteful use of money. If the government-provided supports are universal, the advantage to wealthier recipients can be off-set by returning to a more progressive tax structure. (This along with with a capital gains, a transnational corporate and wealth/inheritance component might help to genuinely level the financial playing field, while relieving some of the burden on medium to low income families).
Universalizing the benefits of State support also serves to avoid stygmatisation of the recipients who most need them.
https://youtu.be/9IiyfxLx5mQ
Very relevant to the above and well worth a watch.
Thank you Johnchch for the link lesson. (Worth a look, people).The devil in Gareth Morgan’s ideas are in the detail. His idea of a universal income sounds fine. How much? Inflation adjusted. How does that work when employers want to pay less? Unpaid work recognised? (Of course Gareth also plans to serve who only stand and wait, it appears.)
The flat tax. Sure it’s simple – like GST. And like GST it plays right into the hands of those on the highest incomes or with the most assets.
Capital income tax? Okay, that sounds a bit better, but it also sounds like a playground for accounting lawyers. (A wealth tax, on the other hand would tax assets, pure and simple and so sounds like an envy tax, but it is the only way to start to reverse the ratcheting wealth imbalance without having to resort to truly punitive inheritance taxes).
But as I claim above, a money based solution alone would just perpetuate the income imbalance that already exists. There are two kinds of poverty. First, there is Material Deprivation: the risk of dying from lack of a necessity. But there is also Relative Poverty where the difference between your resources and those of the vast bulk of the rest of the population, leaves you unable to participate in a society based on high priced transport, entertainment, housing, power etc etc, and forced into a marginalized life of unrewarded struggle.
It is an ignorant and complacent assertion that the second form of poverty is any less real, any more acceptable and any less likely to cause social disaffection and, ultimately, disruption.
Gareth Morgan’s recipe, while superficially appealing is in reality just a formula for more of the same, while allowing the wealthy, on their 10% flat tax to complain about the poor’s lack of gratitude for their “guaranteed income”.
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