What Joe Hockey Gets Wrong About Welfare

Treasurer Joe Hockey gave an impassioned defence of the Budget to a choir of the converted, telling the right wing forum Sydney Institute in a speech that attacks on the budget constitute class warfare, and that the notion that governments should try to achieve equality of outcomes is an outdated relic of socialism. "We have moved on".

Well, at least they've admitted it: our government has completely abandoned the notion that we should at least try to ensure that no one is poor in a wealthy nation like Australia. Let's abandon the notion of social justice and equality to get on with the job of making money, and if the disadvantaged are too lazy to get on board (nothing else could be stopping them, surely) then that's just too goddamn bad.  

But Hockey is wrong not just by normal standards - those of simple human decency - but by his standards of neoliberalism. For far from achieving its ultimate triumph by destroying the welfare state, neoliberalism requires a functioning welfare state to allow it to pursue it's goals of squeezing worker pay and conditions, whilst still maintaining a sense of civil society.

Neoliberalism as an economic and political philosophy tries to eliminate every trace of what it perceives as waste - nowhere more so than in the workplace. Now, in Australia wages are safe for the time being, although we'll see how long that lasts before the IPA gets its way to reduce the minimum wage. But conditions and security? Neoliberalism has destroyed the idea that if you work hard and the company is profitable, you will keep your job. We see this in outsourcing, short term contracts, the profusion of job ads specifying "no minimum hours, full availability required". People such as nurses, teachers, council garbage workers, who once would have been assured of steady and secure employment, now find themselves facing casual work, uncertainty and doubt. This explains why some 40% of the Australian workforce is underemployed or in insecure employment.

So when Hockey states that "a cleaner, a plumber or a teacher is working over one month full time each year to pay for the welfare of another Australian", he's way off. They're most likely paying for their own welfare. Neoliberalism requires a welfare system to top up the wages of that 40%, allowing businesses access to the workforce of a civil society without having to provide the pay and conditions to maintain that society themselves. Social security payments are a gift to the neoliberals, to big business, allowing them to turn huge profits with little regard to the welfare of their workers.

But why would neoliberals need civil society? Well, they need a pool of sufficiently healthy and educated workers, kept to a basic standard of living so that the workers don't riot in the streets, don't turn to crime, so that the managers can drive themselves to work rather than needing a chauffeur in an armoured car. They play a dangerous game hacking too severely at the welfare system. It is a lot cheaper to provide money for food for a young boy living with a single parent than to provide meals when, after having to leave his poorly funded public school in order to find work to help support the family and being unable to do so, he turns to crime and ends up in jail. Economies with high levels of inequality have worse health outcomes for everyone - both the wealthy and the poor. Why this is, economists are still debating, but the point is that inequality doesn't benefit anybody.

So it is a very delicate balancing act that neoliberals have to play if they want to dismantle welfare and notions of equality, whilst maintaining the civilised society that benefits everyone. One would hope that if this has to go ahead, only the best brains are working on it, to avoid societal disaster if it all goes wrong. But the next time someone complains they're sick of their taxes going to support those on Centrelink, point out it's to the advantage of the neoliberals, not the disadvantaged. And those bums have had a free ride for too long.