Equality of opportunity may not be fair (Ha-Joon Chang’s Thing 20)

23-things-they-don-t-tell-you-about-capitalism“Equality of opportunity is the starting point for a fair society. But it’s not enough. Of course, individuals should be rewarded for better performance, but the question is whether they are actually competing under the same conditions as their competitors. If a child does not perform well in school because he is hungry and cannot concentrate in class, it cannot be said that the child does not do well because he is inherently less capable. Fair competition can be achieved only when the child is given enough food – at home through family income support and at school through a free school meals programme. Unless there is some equality of outcome (ie., the incomes of all the parents are above a certain minimum threshold, allowing their children not to go hungry), equal opportunities (ie., free schooling) are not truly meaningful.

…We cannot, and should not, explain someone’s performance only by the environment in which he has grown up. Individuals do have responsibilities for what they have made out of their lives.

However, while correct, this argument is only part of the story. Individuals are not born into a vacuum. The socio-economic environment they operate in put serious restrictions on what they can do. Or even on what they want to do. Your environment can make you give up certain things even without trying. For example, many academically talented British working-class children do not even try to go to universities because universities are ‘not for them’.  This attitude is slowly changing, but I still remember seeing a BBC documentary in the late 1980s in which an old miner and his wife were criticizing one of their sons, who had gone to a university and become a teacher, as a ‘class traitor’.

While it is silly to blame everything on the socio-economic environment, it is equally unacceptable to believe that people can achieve anything if they only ‘believe in themselves’ and try hard enough, as Hollywood movies love to tell you. Equality of opportunity is meaningless for those who do not have the capabilities to take advantage of it.”

Ha-Joon Chang (2010), 23 Things They Don’t Tell You About Capitalism, p.210-211, 217.

Thoughts on welfare-ism and nationalism

rawRobert Anton Wilson’s Prometheus Rising is a book which tries to make sense of how the human mind works, how to make it work better, and the implications for human development, from the past through the present to the future. It is in part a work of social philosophy, and is truly enlightening about humanity, containing plenty of thought-provoking insights. Here is one which I think is relevant to this blog:

“Welfare-ism, socialism, totalitarianism, etc. represent attempts, in varying degrees of rationality and hysteria, to re-create the tribal bond by making the State stand-in for the gene pool. Conservatives who claim that no form of Welfare is tolerable to them are asking that people live with total bio-survival anxiety and anomie combined with terror. The conservatives, of course, vaguely recognize this and ask for “local charity” to replace State Welfare – ie.,, they ask for the gene-pool to be restored by magic, among people (denizens of a typical city) who are not genetically related at all.”

This is surely right, but for me there is no alternative to some form of welfare state under capitalism, if some of its worst aspects are to be mitigated. Some sort of middle way is preferable to political extremes which have historically been associated with repression and a widespread disregard for human life in the pursuit of ideological purity. Continue reading

Political turmoil and a new Prime Minister. Time for One Nation?

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Theresa May. Image from ukhomeoffice via Wikimedia Commons

A new Prime Minister is on her way, starting tomorrow. This is the latest chapter in the political turmoil that has engulfed the UK since the vote for Brexit a few weeks ago. Theresa May, formerly the Home Secretary, is to become the UK’s second female PM. Now I am not a great supporter of things Tory, at least from the perspective of economic policy, but I was interested to read some excerpts from May’s speech which formally launched her campaign to become the next leader of her party. Of course, this was before the dramatic withdrawal of her only remaining opponent in the contest, Andrea Leadsom.

Some of the details of the speech can be found here. I know that skilled politicians are good at making the right noises to attract voters and ultimately win power. Her bid was to unite her party and the country in the aftermath of Brexit, which will be hard going. But some of the quotes from her speech could have been taken from speeches by Ed Miliband, the former Labour leader. Miliband championed a ‘One Nation’ Labour party, and policies which would aim to promote his centre left, social democratic vision of Britain. Continue reading

‘Decent work’ as a development goal

DSC00236aAre decent working conditions a luxury only achievable in rich economies? In other words, are their improvement part of economic and social development? Or could they underpin efficiency alongside social justice even in poor countries? In a paper published in the book Systems of Production (Burchell et al 2003), Gerry Rodgers considers these issues.

Rodgers answers the above by suggesting that improving working conditions are or should be part of the development process. Some basic rights should be achievable anywhere, but they should also be able to adjust upwards as an economy becomes richer, or when economic resources allow.

He defines decent work as the availability of employment, certain rights at work, a degree of security and workplace representation which promotes constructive dialogue between management and workers. Continue reading

False economies at the heart of austerity

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Homeless in Bangkok. Original by BrokenSphere

Many governments around the world shifted to a policy of austerity after the financial crisis led to large rises in public deficits. There is often much talk about its necessity in restoring ‘confidence’ and ‘living within our means’, as well as its potentially damaging effects on growth. But there has been less comment on the problems of cutting spending in particular areas, only to see it rise in others, thus making significant reductions in the deficit harder. Continue reading

Social policy and productivity

The volume ‘Systems of Production’ tried to answer the question: can social policy be a productive factor? Traditional neo-classical economic models tend to view progressive social policy in the form of regulation and transfer payments through the tax system as a cost to business and a drain on enterprise. A dynamic institutional approach to economic theorising offers potentially different results.
When social policy becomes enabling to individuals and groups in society, and increases capabilities and opportunity, productivity in the economy can actually be enhanced. But it is difficult to measure such relationships, isolating certain causes of increasing productivity and linking them to particular social policies.
The prospect of intelligently designed social policies therefore give societies and polities  a choice. Progressive social policies which involve, for example, labour rights, need not negatively affect enterprise. To the extent that cooperation in the workplace can enhance business performance, but may sometimes not take place due to competitive pressures, legislating for workers’ representation and encouraging cooperation can be a positive force for the economy.