Friday, August 21, 2015

"Our" children not "their" children

The economics editor of the NZ Herald writes, “Wherever you draw the line, too many children are going without. By one measure, one in every 10 New Zealand children is growing up in conditions of material hardship. By a less exacting measure it is one in four. ” 

For 100,000 children, or one in 10, home is somewhere where at least nine of those 17 tests of deprivation are met - a level the ministry labels "more severe hardship." Of those 100,000 children, 69,000 are from families with an income - after housing costs - of less than 60 per cent of the median household income, and 58,000 from those with an income of less than 50 per cent of the median (a more stringent "poverty line").

"A weekly rise in benefits of up to $25 for families at the hardest end will be helpful for families with one child, though less so for those with more children as the increase is per family rather than per child," the Children's Commissioner, Dr Russell Wills, said in his submission on the legislation. Children living in hardship in larger families, where poverty is more prevalent, would see very little effect, he said. And it is a one-off adjustment to benefit levels.


1)      There is little or no real child poverty in New Zealand

Child poverty here is "relative", and while not as debilitating as severe or debilitating malnutrition, it is real, measurable and often leaves "significant and long-lasting scars". "This includes poor educational attainment, higher unemployment, poor health and higher incidence of involvement in crime. For such reasons it matters," Boston and Chapple say. There are generally two ways poverty is measured: income poverty (living in households where the income is 60 per cent or less than the median household income), and material hardship (where children lack things like two pairs of sturdy shoes, or a winter coat, or live in draughty, damp houses). The Ministry of Social Development takes this seriously and tracks child poverty. Depending on the precise measure of income poverty adopted, between 120,000 and 260,000 children are living in this relative poverty.

2)      It's the fault of lazy or irresponsible parents.

Undoubtedly, say Chapple and Boston, some parents do make bad choices, and there's growing evidence that being in poverty actually reduces reasoning capacity. But: "It seems unlikely that poverty is primarily due to people's poor choices." Why, they ask are overall poverty rates three times higher in the US than in Scandinavia? Are Americans lazier and stupider? And why are there so few people over age 65 in New Zealand in poverty? Do they stop making bad choices on turning 65, or is it that society chooses to provide them with NZ Super? And was there a sudden outbreak of bad choices in New Zealand in the 1990s after benefits levels were slashed and unemployment rose?

3)      The real problem is that poor people have too many children

Some believe strongly that the poor can't afford the luxury of children, and simply shouldn't have them, or at least not so many of them. It is unreasonable for society to pay to raise them. The authors say the consensus has been for societies to share the costs of raising children, and that by investing in those children, society receives a return in the future. The authors say there are major ethical problems associated with the view that the poor should not have children, or that a third, or a fourth child should somehow be abandoned by the state and attract no further support.

4)      Assisting poor families will simply encourage them to have more children.

Some believe that having babies is a business, with increased benefits being the reward. But the best international evidence suggests that financial incentives do not have a big effect on fertility levels, the academics say. And, "Current policy settings in New Zealand favour families with only one or two children. Partly as a result, poverty rates are higher amongst families with more than two children."

5)      The real problem is poor parenting

There is no need to choose between poor parenting and poverty as being the real problem, the authors say. "Both are real and disturbing." And both poor parenting and poverty cause harm to children, who are powerless against either force. In fact, Boston and Chapple say: "There is good evidence that the stress and anxiety caused by poverty are factors that contribute to poor parenting and harmful outcomes for children."

6)      We can't do anything about child poverty

Some believe the "perversity" thesis, that anything you try to do will only make things worse. Some believe the "jeopardy" thesis that spending on alleviating child poverty will put other policy objectives like economic growth at risk. Then there are those who buy into the "futility" myth that nothing can be done. This last often argue that as poverty in New Zealand is relative, it can never be reduced, but Boston and Chapple say that stance is often the result of mixing up median income and average income. Relative poverty can be alleviated even if the median income does not move. And, they say, the evidence is clear that "Child poverty rates are responsive to government policies."

7)      We can't afford to reduce child poverty

This is really a question of whether spending money on child poverty is "worth it", the academics say. The authors say we can't afford not to. "Child poverty imposes significant costs both on the children affected and on wider society. Investing well in children produces positive economic and social returns, and is also likely to save on future fiscal costs." Indeed: "The international and domestic evidence suggest that the scale and severity of child poverty are at least partly matters of societal choice." And, they say: "Since the early 1990s we have chose to tolerate child poverty of significant levels and duration; reducing child poverty has not been a high priority."

8)      Reducing or even eliminating child poverty is relatively easy.

While Government policies have a direct impact on child poverty levels, things like cutting spending in other areas to find the money to pay for it, or lifting taxes are not easy. And, child poverty is not solely about a lack of financial resources. Child poverty continues to exist in countries with comprehensive and relatively generous welfare states, the authors say.

9)      Increasing incomes for the poor won't solve child poverty

"There is no evidence that the majority of poor families are grossly incompetent or wasteful", the academics say. But it is true that providing money alone won't always be the most cost-effective way of achieving outcomes like getting adults into work. "The most recent international evidence suggests that increasing the income level of poor families can certainly generate better outcomes for their children. This is particularly the case if the income boost occurs when the children are young." And, they say: "The claim that "throwing more money at the problem doesn't help" is unfounded."

The World Socialist Party (New Zealand) can understand why children may well be "innocent", "our future" and other such sentimentalised slogans, but, yet, more significantly, are also an immense hindrance to the smooth operation of the system of production for profit. Government promises are all very well, but it's the economy that usually decides whether a political reform will stick. One of the main criticisms that the WSP(NZ) have of attempts to reform the insane system called capitalism, is that gains obtained one year may disappear when the economy dips, and you find yourself back at square one again. Those social workers whose job it is to mop up the human victims of the profit machine, are variously described as "failing", "incompetent", "not fit for purpose" but these
adjectives should instead be directed at this social system. The cause of poverty, however defined, is the way that society is organised, with a small minority owning the means of production and the overwhelming majority forced to sell their labour power for a wage in order to survive. Workers may sometimes be able to maintain a reasonable standard of living, while at other times they may be excluded from what is by any criterion a basically acceptable way of life. But we are always excluded from true empowerment over our lives and those of our families – and that is not something that can be achieved under the present social system. Poverty is an inescapable part of capitalist society. It can be abolished, but only when there is a fundamental change in how we organise society. The means to end poverty are with us now. They have been with us for a hundred years or more.

WSP(NZ) website: