2017 rewind: Why fiscal responsibility is the Bog of Eternal Stench

The fourth-most-read post on Boots Theory last year questioned a pretty strongly-rooted tenet of modern Labour Party faith. People have said to me since the election result, “see, it worked!” Yet National still gained 44.4% of the vote, and Labour’s boost came directly from Jacinda Ardern’s amazing personal appeal. And the question now becomes: is winning one election worth it if we don’t actually change the status quo?

Originally published 25 March 2017

Labour and the Greens have announced a cornerstone coalition policy for the 2017 general election: a set of Budget Responsibility Rules which will, per the Greens’ website:

… show that the Green Party and the Labour Party will manage the economy responsibly while making the changes people know are needed, like lifting kids out of poverty, cleaning up our rivers, solving the housing crisis, and tackling climate change.

It feels like I’ve been banging my head against this brick wall for a decade. The short version is this:

Labour and the Greens cannot credibly campaign on a foundation of “fiscal responsibility”. It is anathema to genuine progressive politics. It isn’t a vote-winner. It’s a vote-loser.

I’ve heard the defence: but we ARE the fiscally responsible ones! Look at our surpluses in government! Witness our detailed policy costings! BEHOLD OUR GRAPHS!

If empirical evidence worked, we’d already been in government and this conversation wouldn’t be happening, and I know I for one would be happier for it.

Everyone knows this is crap. No one really tries to defend it by saying, “but fiscal responsibility is the most important thing in government”. They say, “but we need people to believe we’re fiscally responsible.” They say, “but the media always ask how much our policies will cost!” They say, “we need to win or we can’t achieve anything, learn to count Stephanie.”

We know we’re selling our souls, but only for the right reasons. The tragedy is, we’re not. Fiscal responsibility is the Bog of Eternal Stench. Once you dip so much as a toe in, it makes everything else you do reek.

Don’t just take my word for it – after all, we’re all rational creatures making objective decisions based on evidence, right? Take it from someone who has the evidence, my favourite American Anat Shenker-Osorio:

Peer-reviewed psychological studies show that money-primed people … become more selfish. They are, for example, much less willing to spend time helping another student pretending to be confused about a task. When an experimenter dropped pencils, money-primed subjects elected to pick up far fewer than their unprimed peers. Also, when asked to set up two chairs for a get to know you chat, those who had money put on their minds placed the chairs farther apart. Money-primed undergrads showed greater preference for being alone.

The results of these experiments should give progressives pause and serve as lessons for how we do our messaging. Talking about money first makes the whole subsequent conversation start in a mean and selfish place — the last thing we want when we’re talking about the common good and our national future. …

Those politicians who actually believe in the institution in which they serve would do far better to speak of what government does for us — and trust that we’re smart enough to know that good things don’t come cheap.

If we prompt New Zealand voters to think about money first, they aren’t going to think about common good, about ensuring their neighbours have a good life too. They’re going to think “actually, getting another block of cheese each week does sound good” and the right’s fourth term is secured. They don’t even have to work for it, because when we explicitly buy into their values, it weakens our own.

It cuts out the heart of our politics. Our critics are absolutely right: Labour and the Greens are not trusted to be good fiscal managers. THAT’S THE POINT. No one wants us to be good fiscal managers – except for the right, who are thrilled that we not only want to play in their playhouse but will obey all the rules they’ve made up to ensure they always win.

It’s like some people watched Mean Girls and thought, “well of course we have to wear pink on Wednesdays and throw out our white gold hoops, how else will we get Regina George to truly respect us?”

Pink is not our colour. Fiscal responsibility is not our strength. The economy is not the most important thing in the world – HE TANGATA, HE TANGATA, HE TANGATA.

We’re meant to be the ones who care about people, and make sure everyone in our communities is taken care of, whether they’re sick, or old, or exploited by a shoddy employer or having a baby or building a life in a new country. These are the areas where we’re strong. These are the values which we must promote – not just because we hold them dearly, but because doing that is the best way to fuck up the other side’s message of greed and self-interest and exploitation of people and our planet.

People want change. They don’t want poverty and housing crises and public services stretched to breaking point. They know these things cost money! But they’ve been told for decades that government must be small, and the private sector runs things better, that the only metric that matters is that sweet surplus. They know it doesn’t feel right, but there doesn’t seem to be another way of doing things, because we keep telling them we agree with it. And they vote for the party they “know” are the better economic managers, because that’s National’s brand, and not all the graphs and spreadsheets we throw at them are going to convince them otherwise.

We’re never going to win while we keep playing in the right’s playhouse and skinny-dipping in the Bog of Fiscally Responsible Stench because we want to smell just like our enemies. We have to be an alternative. Stop talking about the bloody money and start talking about people.

Why fiscal responsibility is the Bog of Eternal Stench

Labour and the Greens have announced a cornerstone coalition policy for the 2017 general election: a set of Budget Responsibility Rules which will, per the Greens’ website:

… show that the Green Party and the Labour Party will manage the economy responsibly while making the changes people know are needed, like lifting kids out of poverty, cleaning up our rivers, solving the housing crisis, and tackling climate change.

It feels like I’ve been banging my head against this brick wall for a decade. The short version is this:

Labour and the Greens cannot credibly campaign on a foundation of “fiscal responsibility”. It is anathema to genuine progressive politics. It isn’t a vote-winner. It’s a vote-loser.

I’ve heard the defence: but we ARE the fiscally responsible ones! Look at our surpluses in government! Witness our detailed policy costings! BEHOLD OUR GRAPHS!

If empirical evidence worked, we’d already been in government and this conversation wouldn’t be happening, and I know I for one would be happier for it.

Everyone knows this is crap. No one really tries to defend it by saying, “but fiscal responsibility is the most important thing in government”. They say, “but we need people to believe we’re fiscally responsible.” They say, “but the media always ask how much our policies will cost!” They say, “we need to win or we can’t achieve anything, learn to count Stephanie.”

We know we’re selling our souls, but only for the right reasons. The tragedy is, we’re not. Fiscal responsibility is the Bog of Eternal Stench. Once you dip so much as a toe in, it makes everything else you do reek.

Don’t just take my word for it – after all, we’re all rational creatures making objective decisions based on evidence, right? Take it from someone who has the evidence, my favourite American Anat Shenker-Osorio:

Peer-reviewed psychological studies show that money-primed people … become more selfish. They are, for example, much less willing to spend time helping another student pretending to be confused about a task. When an experimenter dropped pencils, money-primed subjects elected to pick up far fewer than their unprimed peers. Also, when asked to set up two chairs for a get to know you chat, those who had money put on their minds placed the chairs farther apart. Money-primed undergrads showed greater preference for being alone.

The results of these experiments should give progressives pause and serve as lessons for how we do our messaging. Talking about money first makes the whole subsequent conversation start in a mean and selfish place — the last thing we want when we’re talking about the common good and our national future. …

Those politicians who actually believe in the institution in which they serve would do far better to speak of what government does for us — and trust that we’re smart enough to know that good things don’t come cheap.

If we prompt New Zealand voters to think about money first, they aren’t going to think about common good, about ensuring their neighbours have a good life too. They’re going to think “actually, getting another block of cheese each week does sound good” and the right’s fourth term is secured. They don’t even have to work for it, because when we explicitly buy into their values, it weakens our own.

It cuts out the heart of our politics. Our critics are absolutely right: Labour and the Greens are not trusted to be good fiscal managers. THAT’S THE POINT. No one wants us to be good fiscal managers – except for the right, who are thrilled that we not only want to play in their playhouse but will obey all the rules they’ve made up to ensure they always win.

It’s like some people watched Mean Girls and thought, “well of course we have to wear pink on Wednesdays and throw out our white gold hoops, how else will we get Regina George to truly respect us?”

Pink is not our colour. Fiscal responsibility is not our strength. The economy is not the most important thing in the world – HE TANGATA, HE TANGATA, HE TANGATA.

We’re meant to be the ones who care about people, and make sure everyone in our communities is taken care of, whether they’re sick, or old, or exploited by a shoddy employer or having a baby or building a life in a new country. These are the areas where we’re strong. These are the values which we must promote – not just because we hold them dearly, but because doing that is the best way to fuck up the other side’s message of greed and self-interest and exploitation of people and our planet.

People want change. They don’t want poverty and housing crises and public services stretched to breaking point. They know these things cost money! But they’ve been told for decades that government must be small, and the private sector runs things better, that the only metric that matters is that sweet surplus. They know it doesn’t feel right, but there doesn’t seem to be another way of doing things, because we keep telling them we agree with it. And they vote for the party they “know” are the better economic managers, because that’s National’s brand, and not all the graphs and spreadsheets we throw at them are going to convince them otherwise.

We’re never going to win while we keep playing in the right’s playhouse and skinny-dipping in the Bog of Fiscally Responsible Stench because we want to smell just like our enemies. We have to be an alternative. Stop talking about the bloody money and start talking about people.

How we talk about tax: the shiftless hordes and the hard-working rich

This is how Stuff chose to headline an article about the way income tax is paid in New Zealand:

tax brunt
On the Facebook thumbnail, it was even worse:

tax hordes
(Congratulations, baby, you’re part of a horde!)

There are many ways to debunk the entire premise of “some feckless baby-makers just want to live in luxury off the rest of us”, like:

 

You could point out that “just counting income tax and not GST” is a Kiwiblog standard tactic as old as the dinosaurs.

You could ask why “an economist at Infometrics” doesn’t understand that literally every country has “a top 1%” because that’s how percentages work.

And you could focus on the comments from Drs Susan St John and Deborah Russell – experts in tax and inequality who understand the world is far more complex than “income tax in, Working for Families out”. Dr St John says:

“We are all in a negative position when you look at what the state provides. If you have an individual on a given income with no children and someone else with the same income and multiple children, they are not in the same position to pay tax. This gives some degree of horizontal equity.”

And Dr Russell:

“Everyone regards superannuation as an entitlement – they think older people are entitled to support because they cannot work any more.

“But why not apply the same thinking to children as well? They can’t go out and earn money. Children do not choose their parents. They are not possessions or commodity items. We need to think in terms of supporting vulnerable citizens – the sick, elderly and children.”

The article redeems itself somewhat with these quotes – right at the end. But what does the headline tell you? Hordes of people aren’t really paying any tax. A small number of good, industrious people are bearing the brunt of tax. When that’s the way the issue is framed from the get-go, it reinforces a terrible set of ideas we have about tax, society, welfare and community: from “people receiving benefits are bludgers leeching off the rest of us” to “the rich are rich because they work hard and don’t expect handouts” to “tax is a terrible thing and wouldn’t it be great if none of us paid it?”

These ideas have become ingrained, reflexive assumptions, thanks to a concerted, decades-in-the-making effort from the right, but also a failure to provide an alternative set of ideas from the left. We oppose National when it promises tax cuts and spins surpluses out of thin air to make them look reasonable, but we also accept that a government must “live within its means”.

We have tacitly supported the idea that tax is a burden, that government spending should be reined in, that we must avoid at all costs getting hit with the “tax and spend” label. We’ve abandoned the good old socialist rhetoric about where wealth comes from – labour – and why government exists – to ensure wealth is distributed more fairly and support everyone in our society to live a good life. Instead we propose minimal-cost policies and fiscally-neutral spending.

It can feel like an insurmountable challenge, I know! The rightwing rhetoric is so pervasive we don’t even see it as a political statement any more, to say “business creates jobs” or “goverments must deliver surplus”. But we can be bold and challenging and forthright about the principles that matter to us.

We can offer an alternative. It’s what people are crying out for.

No shit: money alleviates poverty

It’s understandable why we’ve generally accepted the rightwing line that “you can’t just throw money at the problem” of poverty. It seems far too simple: people do not have enough money, ergo give them money.

So we end up kind-of-agreeing with the idea that it’s all a big complicated systemic mess which needs to be handled in a number of different ways, which conveniently enough always end up funnelling money into the hands of private business (so they’ll “create jobs”) and making life even harder for the people who have the least (to ensure they’re “deserving”).

The thing is … money basically does fix the problem. Dr Jess Berentson-Shaw of the Morgan Foundation writes at the DomPost:

Boost the incomes of the poor with no conditions attached? Cups of tea will be spat onto the newspaper across New Zealand. However, when we brought together the highest quality evidence, the science was clear. Many will claim there is no silver bullet for fixing child poverty, but the evidence suggests they are not quite right. The best evidence we have tells us that boosting the incomes (without strings attached) for our poorest families will close about half of the gap in health, education, and employment between the haves and the have nots.

The research shows it. The Economist says it. And it does simply make sense, because we live in a capitalist society. In Simpsons quotes, this means:

simpsons money goods and services

Money, and having it, and utilising it to get the basic necessities of life, is basically the central pillar of human life in a capitalist society. (It shouldn’t be, but that’s a whole other post.) Poverty is the specific lack of money. And it’s not like there isn’t enough money to go around: it’s simply being funnelled into the hands of a few. I may sound a little leftwing here, but you know what the obvious conclusion is to me?

We fix poverty by redistributing the wealth of the nation more fairly.

italian spiderman

For the NZ left in 2015, however, there’s a few challenges to face. We’ve accepted a lot of rightwing framing about the deserving poor, the undeserving poor, and the supremacy of paid work as the be-all and end-all of human value. It’s not a simple matter of taking this research and saying “see? Money does fix the problem!” Because it’s been a very long time since Labour, at least, was the party of raising benefits and supporting the poorest New Zealanders unconditionally.

Berentson-Shaw also says:

Pushing parents into work simply shifts them from welfare poor to working poor; between 40 and 50 per cent of our kids in poverty have working parents. The only time in recent years New Zealand reduced child poverty was when we gave cash to some poor via Working for Families.

And Working for Families was explicitly denied to parents on benefits. It was a step in the right direction – but one only taken by reinforcing the idea that the children of beneficiaries can be used as leverage to force their parents into paid work. By accepting that beneficiaries must be forced into paid work. Even when its simply not available.

I’m looking forward to seeing the next two articles on poverty in the DomPost. New Zealanders already agree that inequality is a massive issue and needs to be addressed. Hopefully we can change the conversation from the mean-spirited rightwing frame and get the basic message out there: we are a nation of people who care for each other. We can ensure that every family has the basics of life, and a life with dignity. That means a great public education system, healthcare, state-provided housing, feeding the kids, and giving everyone enough to live on.

~

It may be that giving people money is “only” a short term fix for their situation. But I care about people, so here’s what it comes down to: right now, there are kids going hungry in our country. Paying their parents enough to put food on the table means those kids aren’t going hungry. If your preferred solution is “let those kids continue to go hungry while we address the Wider Issues” I am not going to be subscribing to your newsletter.