The rigors of the system Booth proposed, to end poverty in Britain by harrying the poorest out of existence and regimenting the class above them, are entirely compatible with socialist thinking as it developed in Britain and which he by no means unfairly associated with the poorhouse and the prison. In an essay included in Fabian Essays in Socialism, edited by George Bernard Shaw and published in 1889, Annie Besant describes thus the mechanisms that will encourage workers to fulfill their duties when socialism is achieved:
At first, discharge would mean being flung back into the whirlpool of competition, a fate not lightly to be challenged. Later, as the private enterprises succumbed to the competition of the Commune, it would mean almost hopelessness of attaining a livelihood. When social reorganization is complete, it would mean absolute starvation. And as the starvation would be deliberately incurred and voluntarily undergone, it would meet with no sympathy and no relief.
In other words, the new order would achieve that elusive object of all British reforms affecting the lives of workers, the isolation and elimination of the unworthy poor, worthiness, as always, determined by economic productivity as they chose to define it.
Competition for work cheapens the cost of labor and prevents it from rising in value when demand for workers increases. So the unemployed contributed, after their fashion, a fact grudgingly acknowledged in whatever tolerance they enjoyed. It is not irrelevant to my larger purposes to point out here how little awe there is for human life among these philanthropists or in the tradition they inherit. Human life is weighed routinely in the scales of simple commerce.
Shaw himself, decades later, fulsomely praised the head of Stalin’s secret police, whose picture he kept on his mantel, for having shot an inefficient railroad worker. Shaw expounded on the merits of extermination as a feature of social policy during the formative stages of Russian socialism and German National Socialism, visiting Hitler and Stalin with praise and advice and the prestige of his Nobel-decorated person. For some reason his and the Webbs’ enthusiasm for authoritarian movements has always been interpreted as a misreading by them of the nature of these movements. Yet it would not be difficult to defend Shaw’s statement that Stalin was a good Fabian, his Soviet labor camps being item one. In Shaw’s introduction to his late play, On the Rocks, his enthusiasm for extermination actually recommends the policies of Stalin and the National Socialists to him. For some reason, Shaw has emerged from these involvements reputation intact. He is an acerbic wit, we chortle at his outrageousness. In terms of his own tradition, his views on this issue are not exceptional. In 1839 Thomas Carlyle wrote, “The time has come when the Irish population must either be improved a little, or else exterminated.”
It is difficult to absorb the fact that definitions of goodness, justice, and right vary wildly, especially difficult since we think and speak as though the “West” had reached profound consensus about these things through a long evolution, and was now unanimous in its loyalty to certain values—which were, it is true, swept away in a sort of mud slide of unhealthy enthusiasms only fifty years ago, an event that remains totally inexplicable so long as we insist that “Western values” include a steady faith in the importance of individual freedom and human life.
Because Americans believe that there are such things as “Western values” and that these are identical with their own best impulses, they cannot recognize the real content of the ideas carried along in history, though these ideas have blossomed in events and institutions such as the poorhouse, slavery, the penal colonies in Australia and elsewhere, labor camps for social parasites, and the extermination of unvalued people. I place Sellafield among these manifestations, because it is comparable in nature and in scale.
With the establishment of the Welfare State words of consecration were spoken over truly ancient mechanisms for maximizing profit, stabilizing social relations, and at the same time clothing the state in the garments of benevolence yet again.
William Beveridge, whose Plan for the Welfare State led to his being called the “father” of the new postwar Britain, merely amended Poor Law by absorbing the insurance systems that had been set up by working-class groups and labor unions into a system called National Insurance, taking the rates of benefit from those already established by the very poor to hedge against disaster. This policy was suggested as early as 1786, in A Dissertation on the Poor Laws by Joseph Townsend. Of course, the levels of benefit contrived by the necessitous to see them through their darkest hours were not generous. Benefits financed out of contributions or deductions from the pay of people so situated that they had to brace against the eventuality of a three-pound funeral were necessarily minimal. Beveridge’s innovation, the conceit of calling the state the insurer, meant simply that taxes would take the place of insurance payments. Contribution would no longer be made at the earner’s discretion. These changes infuriated private insurance companies, some of which had grown very great from this modest base.
The problem of poverty, as it was understood by William Beveridge, interpreting a survey by Seebohm Rowntree of the poor in the city of York in 1901, was, needless to say, nothing so simple as lack of money. It was that income was unevenly distributed throughout a worker’s life. He (using a male instance, as Rowntree did) was poor as a child too young to work, better off when he and his siblings could work to help their parents, poor when he had young children, better off when they were old enough to work, and poor again when he passed the age of employability, usually at about forty. It was Beveridge’s idea—Rowntree protested against it—that the problem to be solved was the uneven distribution of money over these five stages of the worker’s life. The “excess” of earning in his more prosperous periods should somehow be made to provide for him in the periods when his income fell below subsistence level. (Beveridge adopted Rowntree’s definition of subsistence as being able to live without sustaining physical damage on an income devoted entirely to the purchase of necessities, very strictly defined.) Rowntree wrote a critique of the Beveridge Plan, arguing that many of those who fell below his standard of subsistence were fully employed families whose situation was the simple consequence of low pay. He urged a minimum wage—to no avail, of course.8
A tax system like Beveridge’s, which withholds a substantial portion of even small incomes, to pay it back again as Child Benefit, Housing Allowance, unemployment compensation, medical care, old age pension, and so on, is a solution to what British reformers have always seen as the improvidence of the working class, who used their spare money, in the best times, on pleasures and comforts—tobacco, tea, clothing, and drink—and, as Beveridge noted, on movies, where, as Orwell noted, they often went to stay warm. This is the sort of excess to be squeezed out by “redistribution of income,” which in British parlance means the reapportioning of income through a single worker’s life, not from the more to the less well off.
Taxation regularized the insurance system, at least to the extent that participation was made universal among employed people at a certain wage level. What it omitted to do was to guarantee a return on the investment at any specific rate. The British government turns a profit on the National Insurance System, which goes into the treasury. So those who pay into National Insurance are taxed at a rate that subsidizes other activities of government rather than enhancing services or lowering rates of contribution. This merely reflects the larger fact that, in guaranteeing subsistence, Beveridge designed a system which would yield neither less nor more. Only against a history of severe deprivation could such an arrangement be called a Welfare State. Only a history of unlimited expropriation would make the Beveridge Plan read as a promise rather than a threat. Yet, a true descendant of the Poor Law, this system is treated as generosity so wanton as to have virtually destroyed the national character.
But the fact that there is in the system no guaranteed rate of return on contributions introduces the flexibility which allows the government to control the rate of real wages. In the nineteenth century, industrial employer
s could pay wages in kind. A worker might receive as pay a quantity of cloth of a very poor quality, and unsalable. This practice was one means—there were many—by which the employer could depress the cost of labor. The British government, by maintaining a level of service below the money value paid for the services, depresses the real wage of workers by selectively depressing the value of what the worker receives in lieu of money withheld in insurance contributions. The Welfare State is descended from the Company Store.
This assuming, by the British state, of the role of industrial employer in depressing the level of real wages is natural enough, since the state has always been identical with agriculture, banking, and mercantile and industrial interests. The idea that the British establishment predates materialism somehow (so much for Croesus), and is rendered free of mercenary considerations by sheer antiquity, is the sort of hokum that ought to make anyone feel for his wallet.
Without going into the details of arrangements that vary from case to case, I want to suggest that the nationalization of industries has also functioned as a refined form of expropriation. The National Health Service, for example, buys drugs from the major British drug companies, all of them private, on terms highly favorable to them. Its budget includes the cost of training all doctors, even those who go on to practice in the numerous private hospitals, which are run by private health insurance companies. So the state in effect subsidizes major private industries with money supposedly spent on public health care—health care, first among all those killing instances of largesse which are the boast and lament of contemporary Britain, just as the Poor Laws were their boast and lament in the centuries preceding.
As it happens, almost no one in the West spends as little on health care as the British,9 despite the fact that they lead the world in death rates from heart disease and lung cancer, costly diseases, if they are cared for. All the noise is simply an especially dramatic manifestation of the princess-and-the-pea paradigm, where the British establishment takes a horrible bruising from an irritant no one else would feel. But there is a wisdom in these tribal rituals. All the lamenting over the burden of public expenditure gives the government a fine reputation for public service, at home and abroad, while it creates an atmosphere congenial to hospital closings—tolerant of, for example, twelve-month waiting lists for spinal injury patients.
One need not look too deeply into the economics of socialized medicine to account for the state of the National Health Service. The government has simply exercised control over consumption by pegging costs at 5 percent of gross domestic product and squeezing services to fit the budget. With an aging population, living at close quarters in deteriorating cities, and with a declining domestic economy—the base against which the budget is figured—there is a rise in need and a corresponding contraction in the resources for responding to it.
Mrs. Thatcher shuts down industries in the service of economic reform. I admit to finding her wisdom unsearchable. But the antecedents of her policies can be clearly seen in British history, when with bold strokes, implacable governors (call them lords or ministers or manufacturers) have swept away the livelihoods of great numbers of British people, in the service of some high object, like putting the Great back into Britain, which always involves enthusiastic obedience to economics’ brazen law, the subsistence theory of wages. Supposedly, dead regions of modern Britain will regenerate themselves. These disused populations will go forth and strive and innovate—a feat all the more glorious since it will be done without resources or training. I think it is more probable that they will become poorer and poorer, that the British economy will concentrate itself even more intensely on white-collar, middle-class service industries such as banking and insurance, in foreign investment, in toxic and radioactive waste disposal, in the chemical and drug industries, the weapons trade, and “invisibles.” The old industries which labor seized upon as its domain are taken away as the commons were from its ancestors. The dole, by preventing, in theory and in general, the worst consequences of these revolutions from the top, makes such high-handedness possible. Poverty as a norm of working-class life has made them acceptable.
Welfare may be seen to be a matter of definition, having to do with values and expectations. We in America have not yet learned to congratulate ourselves for maintaining millions of unemployed people at the level of subsistence, and paying millions more who are employed, at wages that must be topped up to reach the standard of subsistence. One third of the British population is in poverty as the British define it.
Beveridge’s plan, a national compulsory insurance system which assumed—more precisely, was contingent upon—full employment, incorporated union and “voluntary” schemes for covering births, deaths, injuries, illnesses, and temporary unemployment. It adopted also the long-debated system of family allowances, which added to family after-tax income with each child after the first.
The insurance element of the plan simply appropriated the shifts workers had made, to pool a part of their income to fend off the bleakest eventualities, appropriating at the same time the income of workers to cover the costs of the burden the state had assumed. Family allowance was distinctly less popular in its origins than national insurance. It was an attempt to nuance levels of income to conform to need. William Beveridge actually made a case for it first in 1919, when it was his responsibility to attempt to solve problems that beset the coal industry. The solution he hit upon was, I need hardly say, to lower wages.
He proposed to minimize hardship by lowering most the wages of those with fewest dependents. The union protested violently against the entire proposal. In those days there was talk of establishing a minimum wage in Britain. The family allowance system, by allotting pay on the basis of need, was contrary in principle to the idea that the laborer might unconditionally deserve a specified rate of pay. There is no minimum wage in Britain now; the family allowance system has prevailed. Workers, who are heavily taxed, have their money eked back to them—the payment is in fact made to wives—as a very modest subsidy calculated by the number of children, excluding the first child, for whom it is believed best that his parents be “responsible.” Another among these grinding benefits is a mechanism whereby one may apply for some unreachable necessity, a pot or a blanket. In these frugal days, costs are to be “clawed back” (truly one of the great phrases) through withholding from pay or benefit. This extraordinary system is designed to keep real wages at the lowest possible level. And what are the limits of the possible in this situation? When Eleanor Rathbone plumped for family allowances early in the century, she was encouraged by the discovery of recruiters for the Boer War that starveling men make unsatisfactory soldiers. Malnutrition was a threat to national security. Her view was that workers failed to maintain themselves at the level of “physical efficiency,” not because they were poor, but because they made a bad job of being poor. Family allowance was to guide the expenditure of income, not add to it.
It is the distinctive achievement of British socialism to have attracted the energies of the clever to sorting out the details of the lives of the poor. It makes perfect sense, given the assumptions of the culture, that the solving of difficult social and economic problems should be the work of those with heads for that sort of thing.
From the beginning, however, the object was not to eliminate poverty but to make of poverty a less injurious condition—more precisely, to allow the commonwealth the economic advantages of poverty without its economic disadvantages. Alleviation of the conditions of the poor would create a more productive work force, in theory, though in fact British industry had thriven for more than a century on the labor of hungry and exhausted people, largely women and children, and had found little use for vigorous adult men, except in mining and shipbuilding. Industrialists had made a spectacular demonstration of the economic viability of existing conditions. Indeed, the decline in Britain’s dominance of the world economy was usually laid to the rise in the living standards of the working class, even though the greatest eme
rging competitor, the United States, had the world’s highest wages. World opinion might seem to set a lower limit to the standard of life a wealthy power can establish for the mass of its people and still enjoy a good name, but British experience continues to prove otherwise. So the floating downward of real wages has no obstacle or limit. This is truer now that weapons have evolved which make armies redundant.
What living standards really are at one time or another in Britain is a difficult question. Discoveries of poverty always come as a great surprise—to the newspapers, at least. This indicates that the imagination of the conditions of life among those who opine on such subjects is consistently wrong. In the nineteenth century an outbreak of cholera would produce a burst of information about misery and crowding and unwholesome conditions. Parliament would inquire and report, pestiferous slums would be razed, and quiet would settle again over “public,” that is, polite, consciousness, before, alack, the poor who had lost their dwellings were provided with others. Slum “clearance,” like the pulling down of villages that depopulated the English countryside, merely emptied an area of irksome people. Once out of sight, they could be forgotten.
The Road to Wigan Pier, which George Orwell wrote in the thirties, is a sort of song of innocence and experience which shows with unusual clarity how two contradictory apprehensions of working-class life coexist in one “lower-upper-middle-class mind.” Orwell has penetrated this life, not quite as a “visitor,” one of the philanthropic inquirers who entered the houses of the poor to inspect for demoralization, but as something very near akin. He uses the word “inspect” with irritating frequency, and he discovers demoralization. The conditions Orwell describes—poor food, crowding, brutal and uncertain employment—are the staples of this sort of writing. Orwell shares dirty food and a fetid bedroom. The inspiration to stay in a boardinghouse in order to observe his subjects intimately might have come from, for example, Charles Booth, who likewise claimed to have formed an affection for the classes in which he immersed himself, and who likewise reported that a particularly intense happiness was the good fortune of the typical working-class family.
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