Social care is a family affair

Social care is a family affair

by Eben Wilson
article from Monday 29, May, 2017

WHY IS social care policy proving so difficult for politicians? It’s not as if they haven’t had a long time to think about what needs doing.   

That there are a number of reasons sounds obvious; but that plurality offers an insight. The convergence of the need for longer periods of care, the loss of extended family living patterns, the emancipation of women through work, and extended work made necessary by high taxes on families living with high overheads all make traditional self-reliance less palatable.

Yet these trends on their own are not enough to create the present desperate situation. Families are nothing if not adaptable and, again, we have had time to adapt.

That family arrangements are central to the issue is important; elderly relatives are by definition outcomes of families with children; something must have become de-linked in the way that families operate.  

A clue as to what has happened can be found in the arguments in the United States over Obama Care.  To many Britons, strong resistance to a move towards universal insurance coverage seems strange.  It appears self-evident that justice suggests that the less well-off should be offered support.

American ethics, however, see this differently.  Alex de Tocqueville reminds us that the community democracy of American townships included mutually supportive structures in times of need and sickness; while a profound distrust of government and its rules meant that you were expected to cater for your own needs.  In a nation where people were highly dispersed, the cultural tradition of self-reliance had deep roots.

To put it colloquially, truly free Americans saw it as none of anyone else’s goddam business to look after them. To be free, part of life’s choices were to make sure you could afford to be free.  That does NOT mean that the poor were left to rot; it simply separated your contributions to your own needs from your contributions to others needs.

Embedded in this choice to avoid centralised support is a rejection of a knee-jerk presumption that it is unfair to suffer simply due to circumstances of birth. In part, this is a relic of a Puritan approach to God’s will, but it is also a view that if you give a poor person an ounce, he or she will take a pound.  That is, in the parlance of economic choice, there is a price to compassion for your fellow human beings; ignore the price and you suffer unintended consequences.

If this is the cultural context, what happened to family adaptability? In Scotland, we too had community support systems and a dispersed population.  There was also a profound Calvinistic tradition of self-help.  Arguably, we and the Irish exported it to the USA. Yet, here we are with a social care crisis and a government with no money.

The answer is that our ability as families to adapt was taken away from us.  The twentieth century saw a gradual centralisation of all support systems, producing not only a pecuniary dependency but an intellectual one as well.  We now expect state social care to be our support system.

The problem with this approach is the inevitable rationing of central planning. The policy choices that have to be made when the state makes our choices for us introduce impossible dilemmas; a good, inevitably politicised, example in Scotland being the supposed choice between the nuclear deterrent and social spending.  Again and again, the state competes with itself while individuals have no chance to make refined adaptive choices suitable for their own unique and localised circumstances.

Such is the outcome of removing both the price of self-reliance and the price of compassion.  The great mistake of course has been the destruction of any contributory principle which made these prices real to us.

Many say; “I paid my National Insurance Contributions; I deserve the support I get in later life”.  But they’ve been conned, there is absolutely no link between what they paid in and what they get out.

That support is there to purchase their votes; their payments were used to support their parents; we have let the state run a Ponzi scheme in welfare and pension support. Social policy today involves the state throwing money around for political purposes and third sector organisations writing lengthy manuals, at great cost, as to how the less well-off can get hold of some of it.

This is why the Conservative Party is now floundering between a floor and a ceiling in our duty to pay for our old age.  There is no more money in state coffers, so now they are telling us how to use our own.  The loss of free choices over the use of our income is being supplemented with new mandated choices about what we can do with our wealth.  Is it any wonder that the elderly on the electoral doorstep are less than pleased? They can see their adaptability being destroyed; this is a genuine assault on their personal liberty.  The state is damaging families.

That’s very bad news for politicians; not least because that elderly generation will warn their children not to trust the body politic; and so engender further disrespect for the political process; a disrespect brought about by that exact same political process. We are not Americans, but we too are a nation with its roots in a cultural expectation of a fair dose of liberty.

There is a way out, and economists have been trying to sell the idea for many years.  We need to be allowed to contribute on our own behalf, with a clearly understood distinction between the contributions we set aside for ourselves and the proportion of those set aside for others in need.  To do this, we need to have our own personalised welfare accounts going into a paid-up funded system, with funds fully transferable between close family while alive and at death – tax free.

Once this put-aside wealth is established as both a pecuniary fact and a statutory institution, the entire state of welfare changes.  Immediately, incentives are in the right place; payers have the comfort of their own back-up fund with the incentive to make it as large as possible for their old age; politicians have less people to look after with the incentive to maximise this number and so release funds for other policies; provider organisations in health and social care can charge for priced support and so maximise productivity in provision. Crucially, it separates out the true needs of those whose paid-up funds are too small to support them; transfer payments and other supports can then be properly targeted and made transparent to all of us whose taxes pay for them.

Many on the left reject such an approach because they say it would stigmatise the poor, leaving those with small support funds seen to be different; they base all provision on an ethic of equality and dignity. This is nonsense, the present system that requires supplications by the poor through a glass panel between them and their benefits officer is stigmatising beyond all measure; truly demoralising, belittling and vile. A paid-up contributory system, used by all, would put everyone into the same lifeboat system with equal status.  The state would quietly, efficiently and confidentially make sure that everyone had a decent lifejacket; but only if they needed one.  

The wrangle over social care tells us something paradoxical about collectivised welfare systems – they actually generate political and economic inequality. Because they are so inefficient, those with money find other methods to protect themselves; this usually involves over-investing in housing. They then protect this asset forcefully.

Meanwhile, the rationed state-funding system harms those in need, while allowing the well-off to ignore the poor; leaving the state to deal with their plight. The state flounders, stigmatising the poor with complex rationing rules; removing any power over their choices – they are institutionally unequalled.

A recent study by a private insurance company tried to find out why many living in wealthy areas of South Central England were no longer buying health insurance.  The answer was clear; they had enough money to pay for almost any clinical eventuality that befell them.  They had adapted to choices that made them truly free; they just wanted the state to get out of the way.  They also paid a lot of tax; that, they felt, was enough intrusion in their liberties. 

An explicit goal of any centre-right party should always be to show that an increasingly affluent society offers a virtuous circle; greater wealth allows greater self-reliance that itself promotes increased wealth for all; a happy by-product is greater personal liberty and the de-politicisation of policy choices as families become self-sustaining.  In this condition, they are willing and able to help others.

Mrs May seems to be flirting dangerously with centralised methods of governance; all this will do is raise the hackles and the defences of the wealthy and in due course encourage the left to make a bad policy worse, harming the poor yet more.  To re-phrase President Trump, it’s time for her to put families first.

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