National’s grand plan for the economy in the age of peak, peak food, and climate change: lets give tax cuts to the rich and take from the poor. It’s classic Nat class war. They want to force 100,000 people off the benefit in the ludicrously long time-frame of 10 years. But they won’t be creating any jobs so other workers will be displaced and will be wages forced down.
TV3 says that the Welfare Working Group will propose more stringent working-testing of DPB mums and people who have found themselves out of a job and on the dole in this never-ending recession. Apparently, these bureaucratic and expensive measures will reduce the number of working age Kiwis on benefits by 100,000 over the next ten years.
100,000. Um. Benefit numbers have gone up 92,000 under National. So, their great reform is to try undo two year’s damage in ten.
The 10 year time-frame is a joke. It’s like Bill English saying his tax swindle would boost the economy by 1% by 2017 or the 50% greenhouse emissions reduction by 2050 target, or catching Australia by 2025. The end-point is so far away (and National refuses to set interim targets) that it’s meaningless. Key will be gone from politics in three years at the latest, let alone be hanging around to be held accountable for the pledges he has promised will be fulfilled in a decade or more. If they were to manage to beat Labour’s average annual decrease of 13,335 on benefits this year by getting people into new jobs, not just leaving them destitute, and I’ll be impressed. But set a vague target ten years out and what can we do but laugh at them?
But most importantly, it won’t even work. There are 86,000 more jobless Kiwis since National took office – pretty much exactly the increase in benefit numbers. There are more beneficiaries now because there aren’t jobs for them any more. So, what happens if you ‘force’ 100,000 more people into jobs?
They just displace other workers who go on the dole, in which case you don’t reduce benefit numbers at all. Or, more likely, they can’t find work – in which case they just go back on the benefit, and all that expensive work-testing is a waste, or they are left with nothing to support themselves and their families.
The bit about displacing other workers is crucial. We already know that people on benefits want to work – when there was ‘full’ employment under Labour there were just 2,400 long-term dole-takers. But chucking beneficiaries of the dole will make them even more desperate to work, no matter the wage. This ‘reserve army of labour’ will force wages to drop even faster than they already are.
That is the real reason for this attack on beneficiaries. The government isn’t dumb enough to think you can force people to take jobs that don’t exist but it is willing to expend tens of millions on punitive measures against beneficiaries because it knows that the more desperate it makes the poor, the more they’ll undercut each others wages. And the more the elite will prosper.
If National was serious about getting benefit numbers down it would be investing in job creation (it costs the government at least $18,000 a year to have someone on the dole). But they’re not. They’re quite happy with unemployment as high as it is.