ECONOMIC PERSPECTIVES 154

EMILE WOOLF – AUGUST 2024

There’s an old Jewish joke about the elderly family patriarch whose grief-stricken family is tearfully assembled around his deathbed to pay their last respects . “Is Taubele there?” he mutters; “Yes, Papa, I’m here” comes the reply. “Is Moishe there?” “Of course, Papa”. “Is Yizchak there?” “ Yes Papa” – and so on, as he names each member of his family in turn, enquiring of their presence. After hearing the last “I’m here, Papa”, the old man raises his croaky voice “so who’s looking after the shop?!

I was reminded of this fable while reading about the veritable army of 9.5 million people of working age in Britain who are  not working, yet are not classified as "unemployed". No, these people are “economically inactive”, to use the preferred weasel-phrase to dissemble the plain truth that the majority of people so classified have said they are not looking for work, do not want a job, and are content to be living on ‘benefits’. So who, indeed, is looking after the shop?

The age of entitlement

The new Labour administration bleats about the miseries of working under unscrupulous bosses and the need for more worker “rights”. Ushering in a raft of new entitlements is never cost-free. The previous government attempted to import foreign workers to fill shortages, but this merely exacerbated our chronic housing shortage and highlighted bureaucratic ineptitude. But this time, since the onset of Covid, more than a million foreign workers have come to Britain, while 830,000 UK-born people have dropped out of work. Collective indolence is fueling the immigration disaster.

The benefits system, including public sector pensions, has strayed beyond providing a safety net for the most vulnerable, and now costs taxpayers £300 billion p.a. Almost 4m people are receiving out-of-work benefits without even having to look for a job. When the last government announced plans to tighten work-capability assessments last year the Labour opposition pledged to reverse them. Never mind the upfront cost - just think of the lost tax revenue and the lost productive capacity in our prevailing sick-note culture. 

Perhaps it’s worth adding that, as police and the courts are struggling with the rising number of violent attacks on our streets, we can no longer safely assume that the attacker is a “terrorist”. We increasingly hear instead is that “he is a mental-health patient”. 

…..and mental health disability

When every HR department in the country prioritises ‘wellness’ and a ‘better work-life-balance’ it’s not altogether surprising to find that a staggeringly high rate of welfare claims is based on ‘mental illness’, and the general acceptance that conditions such as ‘anxiety’ preclude work. The percentage of working-age adults claiming disability benefits has trebled since 1992, and over half of all claimants cite mental illness as their disability. Discussion about neurodiversity attracts billions of hits on social media, focusing mainly on autism but also OCD, Tourette's, bipolar disorder, dyslexia, anxiety and depression. 

So rapid and ubiquitous is the spread of the mental disability syndrome that no section of the community could possibly be immune. And when I see the truly asinine nature of parliamentary output these days I am bound to wonder whether the inmates are already running the asylum! 

Just look: according to the TaxPayers’ Alliance our national debt is rising by £382 million per day. Yet the round of public sector pay awards has barely begun. After members of Aslef’s train drivers’ union have been awarded inflation-busting pay rises, others are following. Staff on the LNER line are walking out and border officials are striking. Civil service numbers have gone up by over 20% since 2016. And they are set to rise even more when Labour makes all the “temporary” increases permanent. Does anyone in the treasury notice? Does anyone have the guts to declare that the ingrained spending routines are just plain mad? 

Just look at the maths

And Sadiq Khan, London’s mayor, has jumped onto the loony-ride with his own insane (and unoriginal) contribution to the mix: rent controls - the socialist doctrine that unfailingly backfires every time it is resurrected. Rent controls reduce the availability of rental properties when their owners sell them or convert them to a different use. They also reduce the quality of rental accommodation when landlords try to recover lost revenues by skimping on repairs and amenities. Or they simply recognise that once a government displays no respect for private property rights and voluntary private agreements, it will not stop there. Like all interventions that produce a result the precise opposite of what is needed, rents are governed by the market - and Soviet-style suppression can never succeed.

Once again: on government’s myriad spending splurge, one is bound to ask, “where will the money come from?” Over 50% of the population are now ‘net recipients’ from the state, meaning quite simply that they are extracting more than they are contributing. You don’t need to be a Nobel scientist to see that this situation is utterly unsustainable. We have forgotten (assuming we ever knew) that the precursor to wealth must always be work. If it wasn’t your work, it must have been someone else’s. Otherwise known as theft? But in a sick-note culture fewer and fewer are net contributors. I repeat, “where will the money come from”?  I can hear the cogs of  a renewed “print-on-demand” programme warming up in Threadneedle Street. Followed by a level of monetary inflation and concomitant price inflation that Britain has not experienced since 1945. 

[EMILE WOOLF – AUGUST 2024 – EP154]