Scrap the Welfare State!
In 2007 I wrote a book, Scrap the BBC!, saying that privatising the BBC was a cinch compared to fulfilling the far more important ambition of scrapping the big-state socialist NHS. A decade and a half on, I return in this rather long (<3,500 word) essay to that tougher theme, and have ramped it up to encompass the even more important ambition to scrap the big state socialist welfare system altogether. That’s the work of perhaps 30 years’-worth of Parliaments. It needs to be stated now as the long-term vision of any party which wants Britain to be post-socialist. Backing down from that challenge is an act of daily cowardice.
This piece re-edited 9 December 2024 is a DRAFT. I would of course welcome comments. I intend to add leads to related material.
The Big Idea
The UK’s big state socialist welfare state provides good evidence that politicians who try to use government to provide too much which their publics need or want will end up damaging both themselves and those they seek to help. This rather long (<3,500 word) essay argues that a clever state could probably mandate, regulate and even long-stop guarantee great things, and a wise one wouldn’t try to deliver or own them.
The cross-party socialist assumption
The so-called “conservative” broad church Conservative Party is quite socialist. I mean that it likes and has encouraged a big and busy state, as do a large majority of the country’s voters. Even the party’s “right-wing” is enamoured of the state’s provision of every aspect of its citizenry’s primary and secondary education, child-rearing, healthcare, hardship benefits, core pension provision and much social (in-community) and late-life (residential) care. The so-called “hard-right” Reform party contrives a dislike of the Conservatives’ mish-mash whilst largely endorsing their socialist big state approach. Standing leftwards of conservatism and milking all sorts of clapped-out class resentments, the Labour Party seeks to be strikingly more socialist than the Tories but is constrained by electoral and fiscal pragmatism. (The main difference between Labour’s socialism and the Conservatives’ is that Labour has an itch to nationalise.) In short, the country is governed by an unspoken Butskellism which sells out conservatism and endorses a socialism which nobbles the British person, the British voluntary sector, and British capitalism. (I have previously sketched out the need for pro bono professionalism. And I have sketched the capitalsm vs ethics dilemma.)
The state is eating society. In cash terms, the state consumes getting on for half of the country’s annual income. The welfare state eats about half of the state’s tax-take.1An authoritatively accessible account of the situation is at the IFS Taxlab Key Questions. It does so in the name of fairness and niceness. Radically changing such a monster is impossible within the timescales of current retail politics. Indeed the whole idea of its deep reform is taken to be unimaginable when only a few institutional voices even mention it as a realistic even if distant prospect. (My impression is that only the Institute of Economic Affairs is consistent in beating this drum.)
So socialism has won and few people seek a way out.
The Civilised Right-wing and the state
The unelectable and politically unrepresented Civilised Right-wing believes the state should have a vital but limited role: it should only operate where it is indispensable. (Elsewhere I have sketched out more about the CR-w.) This doctrine fully accepts that the state has a proper role in managing the country’s currency and fiscal health and in international treaty-making. Beyond those functions, it believes the state should limit itself to funding and enforcing the rule of law; and funding and legitimising prisons, the police, and the military. These are necessary and unpleasnt roles, in the sense that they are about legitmate use of force, whose exercise the state rightly reserves to itself. It shouldn’t do kindness because it needn’t. Indeed, the state’s 70-odd years of over-reach is a betrayal and reversal of centuries of hard-worn social progress. Capitalism, philanthropy and the voluntary sector should take care of that pleasant stuff, alongside a motivated and empowered citizenry. The state should restrict itself to a night-watchman and a long-stop regulator and maybe guarantor role.
By the end of the 19th Century, it had become obvious that private, co-operative, genuinely community- and insurance-based systems could provide a virtuous and workable solution to ancient ills. Indeed, mass affluence was more required than politicial ambition in the abolition of need. Well before the mid-20th Century William Beveridge saw that development and sought to build on it, but his great insurance-based plan was trashed by a thoroughly socialist post-WW2 Labour government.
The historic fact of 70 or 80 years of big state socialist welfare provision are reluctantly accepted by the Civilised Right-wing as a temporary fait accompli, or even as a sort of reversible coup d’etat. The Civilised Right-wing is distinguished from the uncivilised by its respect for the rule of law and for parliamentary or representative democracy, including the concept of the Crown In Parliament. Thus, it accepts the rather absurd socialist state of affairs presently in play. After all, the “golden generation” which fought WW2 conceived of a welfare state which would provide a life fit for heroes. The vital cohort born in the 1920s had put themselves into live-or-die service of the state as it waged war and now they wanted to see it forge a different sort of peace. If the votes of any generation were owed special respect, they were these. But their thinking was misguided and the result has been dire.
The UK’s self-indoctrination
Britain’s post war governments have enthusiastically or diplomatically accepted the legitimacy of the solid parliamentary consensus in favour of a hegemonic welfare state. Thus they have actively embedded or been complicit in the mass indoctrination, or dumb enculturation, of generations of Britons. A mere fascist or soviet communist might be thrilled to see a citizenry gently made so permanently quiescent in the big state’s authority and sovereignty. 2Soviet, Fascist, socialist, social democrat and conservative governments have all, and for very different reasons, bought into a big-state model. Some of these ideas are worked-up in my “The Modern West: Assaults from inside and out“. In Britain, this is only a little surprising. The Conservatives, especially, find themselves not only bound to state-heavy government, but – fearing the “Nasty Party” tage – are quite unable to lament the fact. Even the avowed opponents of wet or One Nation conservatism, whether they are Reform or the rising stars of the right of the Conservative party, do not out loud state any preference they might have for the eventual replacement of state welfarism.
Seventy years after the inauguration of the process of big-state enculturation, in what was perhaps the first national rally ever held in Britain, the opening ceremony of the Olympics in London in 2012 celebrated the National Health Service with an almost religious devotion. The Attlee welfare state had became an unshiftable behemoth and an orthodoxy across every party, even in an age which had declared the death of socialism. Because representative democracy is a retail business, the popularity of the state’s multi-pronged welfare state became a non-negotiable feature of all parties, of left or right. From the politicians’ point of view, this may almost had been a relief. They have little faith in themselves, or the civil service, or the electorate, or the professions, or in capitalism, or in Big Society (as David Cameron half-heartedly dubbed it). Indeed, granted the very real practical and technical difficulty of abolishing Britain’s welfare state the imagineering difficulty of reforming the British welfare state of mind is – to the faint-hearted – a welcome barrier to reform.
Democracies and difficult policy
Even sound representative democracies find difficult policy impossible to imagine or propose. That is perhaps especially true now when a wide range of forces are denigrating expertise and experience for fear that it is elitist. There is also the difficulty that we may now lack the deep cadres of professionally honourable managers which capitalism needs to develop if it is massively to expand its role in the country’s welfare systems. But in any case, and even if the willing and competent staff were on hand, difficult policy may actually be difficult to implement.
Dismantling and replacing a hegemonic welfare state will be technically extremely difficult. Broadly speaking, the new system would presumably be insurance-based, and involve some element of cross-subsidy and probably taxpayer top-up for the unfortunate or determinedly feckless. Nurseries and schools, hospitals and GP surgeries, care homes and care in the community services all and always ration the welfare they provide. All have to decide when a “client” will be accorded or denied access to a service. In a privatised system, the state or perhaps the legal system will presumably always be the regulator of last resort. But whereas the socialist state disguises its rationing processes, the privatised welfare system could ill-afford to be so furtive.
I have argued elsewhere that some of those voters who think themselves thoughtfully committed to the welfare state should at least sense a dissonance between their career ambitions and any claim to be socialist. Many of them declare that they are wedded to state provision but buy private provision either habitually or when – in medical extremis or consumerist impatience – they are tired of the state’s rationing. Alongside these private developments, our NHS is already deeply infiltrated by private players. It may be – as so often – that the impossible future is quietly becoming the new modernity without showing its hand until it has taken over.
Part of the uncomfortable frankness politicians will need to display, and the voters to accept, is that the UK is less rich than it thinks. The big Tory lie is that low taxes would lead to “more money in your pocket,” as though it would be available for consumerism (after all, we could only have lower taxes if we accepted less state provision and higher insurance and savings costs). The big Labour lie is that high taxes could abolish poverty and provide much more welfare (though tax-payer meanness would keep the system under-funded).
In libertarian heaven, individuals look after, and insure, themselves and thus cost the public very little. But in the real world, a good society will be very expensively a charge on citizens and the public purse and its access to the well-off. There will always be needful people, some of them feckless, so wealth transfer will always be essential, though it may be more state-mandated than state-provided.
After the fantasy: the merits of realism
In the present fantastical system, most people are entirely free of the need to think about how their social services are paid for. Some of them believe their National Insurance contributions pay for them. This was a fiction even when it was loudly proclaimed in 1949. Many people believe that their taxes pay for their welfare. This too is a fiction. Probably a lot fewer than half of the population pays more in taxes than they consume in social services.3This phenomenon of “churn” can be explored at the ONS “effects of taxes and benefits on household income” section. It is all interesting stuff, but Fig. 5 speaks to churn and my take on it. It is of course moot whether the well-off could be rich without the much more numerous “working people” who keep the wheels of wealth creation turning. Or rather, it is a tense matter to decide what sort and number of “working people” are now needed, and what their relationship with the rich should be. For instance, is it a good idea to import a new sort of worker who is likely to both disadvantage an existing underperforming native whilst costing more in lifetime welfare than contributing in lifetime taxes?
The dislocation between the state’s myth-making and its weak welfare provision creates a client population which is riddled with a sense of irritated entitlement. The citizenry is stubbornly proud of the NHS, and are failed by it, but can’t conceive of an alternative. After all, they are not presented with such a possibility even as a distant prospect for a more realistic, better-educated, less consumerist generation which would seriously engage in putting their future unknown needs ahead of their present consumerism. If they started young, most citizens could be better educated and live longer and healthier lives, and probably have far more interesting employment and retirements if they had been enculturated into understanding how much their wellbeing and welfare was in their own hands. Their children and grandchildren would probably be on a much better footing too. (This is not a moral homily from one who has lived the responsible life. Rather, it is a sort of apologia from a person who has been pretty feckless throughout.)
In a small state world, and with the abolition of big state socialist welfare state, very difficult societal relationships would be far more glaringly obvious. More people would find that paying for their family’s welfare – their need for insurance and savings – was more pressing than was the historic case. Swathes of society would have to give up much of the consumption that they had become used to. The majority of people would find that they had far less disposable income than previous generations. Presumably there would be enormous pressure for the affluent and for firms to pay more tax and as much contrary talk of the problem of killing the golden goose.
These tensions and difficulties would have the merit of being real. All the players in society would have the chance to view themselves and others realistically. The poorer and middling people in society would not be the infantilised creatures of the state. It wouldn’t be quite the case that we could all become adults standing on their own two feet. None of us can be that. We are all dependent on others. But in the small state world, the nature of those dependencies would be clearer. In many ways, a small state world would be harsher than our present nanny state. But at least it would be rooted in an honest appreciation of individual self-awareness and responsibility. Voluntary dependence on others might begin to be a mark of moral failure. One’s rights might begin to be seen, properly, as in tension with one’s obligations.
Political realities
These moral considerations, which flow from economic ones, make one see how a more honest approach to welfare would liberate politicians from a structural deceitfulness.
The leftist politicians at one level are more honest than those on the right. It is entirely possible that they believe our lives are in safer hands when the state manages them. They may well believe that the state can run things better than society. It is of course mightily convenient to them to harbour that belief. They seek to make a profession out of managing the state which will simply grow and grow as it manages more and more of the country’s life. Indeed, the more clear it becomes that the state is not very good at managing commercial enterprises the more the left is drawn to celebrating state welfare, which is a nationalised undertaking which is widely conceived as not being capable of being in private, or social, hands. It is unattractive to say so, but it is perhaps only the sheer accretion of state incompetence that may eventually embolden a low-tax, small state, post-socialist weklfare state to become politically viable.
It is a huge luxury, and a great source of optimism, that Britain’s socialist welfare state is unique in a democratic society. In the Anglosphere and on the Continent, a majority of societies have developed social policy along lines recognisable to 19th Century Liberals and to a wide variety of modern politcal parties. It ought to be vastly refreshing to the pro-EU, philoforeign woke soft-left green army of graduates that Germany, France, Switzerland (for instance) have models of welfare provision which are closer to what the Golden Generation’s hero William Beveridge designed for Britain all along. More obviously patriotic cadres of thought of the nearly- or actually-rightwing will perhaps have to swallow their xenophobic itch, if that’s a factor for them. It may stick in their craw to admit that the NHS is not the best in the world, but honesty dictates that they get on with it.
The difficulty seems to be that political and social reform seems to depend on sound ideas being taken forward by leadership, and that the former have not been much developed whilst the latter has been entirely lacking. Neither Thatcher nor Blair seriously grapsed the nettle of socialist state provision of welfare, and they were the stand-out anti-socialist political leaders of the past 50 years and more.
It is shocking that generations of conservative politicians have gone along with the foundational impulses of the left. The electable right bend their minds out of shape when they insist that they believe that the state’s socialist provision of welfare is a Good Thing. The key to their willingness to be dishonest on this core matter is that going along with socialist nonsense is necessary to the conservatives’ real world politics. In some low way accepting socialist welfare lets conservatives proceed to the lesser and highly defensible propositions that only the right can form governments which can help the private sector generate the tax income which can pay for the welfare state, and that only a government of the right has the management skills which can manage the welfare state tolerably well. These two lesser propositions are now in 2024 under the old Blairite challenge renewed by a Labour Party that insists that it can live with real world economics and that the Tories have lost any claim to managerial competence. It would be churlish not to wish the Labour Party well as it attempts to beat the Tories at their own game. It is even possible to imagine heirs to Blair thinking the small state non-socialist welfare impossibility might become a political reality.
It is easy to see how the thinking of left and right have so far combined to hijack democracy. Politicians of almost every stamp are competing to run the state but they are not seriously competing to define its purpose or size. Again, the left is at least honest in its assertion that its core thinking demands a large, busy state which is best run by people who believe in it. They are of course less forthcoming a competing thought that the left will become redundant in the degree to which they succeed in their stated goal of eradicating poverty.
The conservative has no such defence. Right-wingers can readily and honestly assert that their core ambition is the eradication of poverty and that their route to that objective will be quicker and more sure than the left’s. Once achieved, conservatives can assert, conservative instincts and intellects will be required to maintain society’s vigour. The fulfilment of this sensible ambition requires that the conservatives re-acquire a reputation for competence. It is much harder for them to develop a taste for the profound frankness which a serious party should want to offer its electorate.
The conservative view that a society’s well-being is intimately bound up with a small state is nothing like universal, but neither is it universally unpopular. It is unfashionable, however. The Woke and the populist tendencies, often opposed in other culture war issues, are powerful and leftist in their belief in big state welfarism (though there is a batsqueak of encouragement for private health provision in Reform’s “contract” ). Academia, the media and especially politicians require courage to speak out against such a deep unity in cultural opinion. Thatcher tried to shift the dial in social thinking, but probably built up more resistance than support for her views and in any case did not threaten to topple state welfarism. Blair was a sort of genius, but perhaps learned from Thatcher’s case that some important things were too painful to say. Successive leaders on all sides have more or less given up on articulating anything useful about the need for a vibrant private sector which might eventually allow the state’s welfarism to be abolished.
Conclusion
The British have never been communist, fascist or even very socialist. Until recently, they have not been much prey to psychobabble or populism. Yet the accretions of the big state’s socialist welfarism have happened as a sort of miasma, not challenged but actually encouraged by the Tories and nearly everyone else. It can be shaken off, given time. Not least, we can be sure that it can’t withstand a decently honest conversation. The underlying tensions in human society won’t be eradicated by the abolition of the socialist welfare state, not by a long chalk. But many issues in poverty, education and health will be better managed when as many people as are capable of it have a willing awareness that their well-being is to some extent in their own hands. Encouraging that tendency is the acid test of a society. That one should be frank as to one’s view of society as one seeks democratic power ought to be a given. The Conservative Party ought as an elementary first step to assert that it is bound in honesty to begin the generational task of ridding the state of its socialist welfare system.
Footnotes
- 1An authoritatively accessible account of the situation is at the IFS Taxlab Key Questions.
- 2Soviet, Fascist, socialist, social democrat and conservative governments have all, and for very different reasons, bought into a big-state model. Some of these ideas are worked-up in my “The Modern West: Assaults from inside and out“.
- 3This phenomenon of “churn” can be explored at the ONS “effects of taxes and benefits on household income” section. It is all interesting stuff, but Fig. 5 speaks to churn and my take on it.
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