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The UK economy is suffering from subsidies that extend the problems they’re meant to resolve, writes Alan Shipman. 

Kissing babies at election-time is a practice politicians often regret but cannot seem to renounce. So, too, is commenting publicly on those that go on to become the victims of extreme parenting. By suggesting that the deaths of six children in Derby could have resulted from state welfare support for the father who killed them, Chancellor George Osborne risked accusations of trading on a tragedy. But in reality, he was only demonstrating a firm grasp of standard economic principles. 

Foremost among these: if you tax anything you get less of it, and if you subsidise anything you get more. Expanding something with a hand-out can be good, if it’s something the community hasn’t got enough of. For if there’s already too much, then subsidy just worsens the excess.  So while supporters of welfare benefits see them as tackling poverty and social exclusion, critics say they amplify these evils. If you subsidise the poor, you just get more of them. Any top-up allows people to get by on unproductive jobs, or none at all. So giving them less can make them (as well as their community) better off, by forcing them into new or better work.

Some evidence of success for a strategy based on these principles emerged from the UK unemployment data released on 16 April. Unemployment rose, in part, because more previously “inactive” adults had chosen to seek work. Many of these are women with children who are far from inactive in their homes, but described as such by economists until they find paid employment outside it. The government says that over 800,000 people have abandoned their claims to out-of-work benefits as a result of stricter eligibility tests, and benefit changes that ensure they’re better off in work.   

These changes would have been essential even without the recent financial crisis, according to Work and Pensions Secretary Iain Duncan Smith, because of an inexorable rise in the number of claimants and average size of claims. The state benefits bill has risen from less than £90bn in 1990 to over £150bn in 2012 and this at that year’s prices. It’s jumped to more than 10% of national output in the current recession. (See this article in The Economist).

However, this growth doesn’t automatically confirm the existence of a ‘benefits culture' prompting people into premature retirement. Some of it has been caused by an unexpected rise in longevity, which leaves many claiming benefits to cover depleted pension pots or rising care costs, so that state pensions comprise almost half of state ‘benefit’ spending. Some is due to house price increases since the early 1990s, causing a rise in accommodation costs which governments dare not reverse because any further price fall would make Middle England’s mortgage unrepayable. The biggest growth has been in benefits and tax breaks given to people in work, which now vastly exceed the £5bn paid in jobseeker’s allowance in 2011/12. 

Corporate welfare
The awkwardness of these rising payments to the working poor (in means-tested benefits and tax credits) is that they can equally well be viewed as state aid for employers, enabling them to pay less than a living wage knowing that the state will make up the difference. This has not been prevented by the introduction of a minimum wage alongside tax credits, which governments dispense much more grudgingly than the numerous tax breaks allowing large employers to minimise their tax bills. The dramatic spread of low pay, while enabling employment to rise and jobseeker’s allowance costs to fall despite the absence of overall output growth, is also the reason that welfare costs will continue to rise after the Coalition’s reforms – as they did under previous governments, including Margaret Thatcher’s.

On the day that George Osborne’s assessed Mick Philpott’s child-killing exploits, a parliamentary committee accused three former HBOS executives of destroying the UK’s fourth-largest bank through avarice and incompetence. It was a reminder that when Britain subsidised incompetent bankers, it got more of them. In this case, government-backed deposit insurance and inevitability of state-financed bailout give large banks an implicit annual subsidy of £10bn, according to the Independent Commission on Banking.  And whereas any subsidy to ‘dole queens’ (and kings) is a richer-to-poorer redistribution that goes back into circulation when recipients spend it, the bankers’ subsidy is a poorer-to-richer allocation that disappeared into their punctured balance-sheets, along with £1,200bn of taxpayers’ money to prevent a systemic collapse.

This trio of errant bankers, and Royal Bank of Scotland’s Fred Goodwin, are often used to portray the whole financial sector as reckless and parasitic. Mr Osborne's resort to the same sort of wrecking synecdoche when using the Mick Philpott case to cast aspersions on all benefit recipients, has tended to expand on all political sides. It’s a tendency that has been spreading, from public-sector reformers who cite Jimmy Savile as a sign of endemic decay in the BBC and NHS, to internal combustion enthusiasts who use one flat battery to reject a whole fleet of electric cars. 

While policy changes may be aimed at stopping the irresponsible arrival of new children, they are also targeting a better deal for those already growing up. Mr Osborne’s 2013 Budget assigns £1bn to subsidise childcare for working families, and several billion to help the purchase of new or larger homes.  Amid a predominantly ‘supply side’ recovery strategy, these measures stand out as delivering a demand-side boost.  The first-quarter growth figures, showing the UK still on the brink of a triple-dip recession, highlight the importance of subsidising assets that the community wants more of. The Chancellor will now be hoping that spending more on nursery places and houses will encourage business to offer more of them, and not just inflate the price of those already there.
Alan Shipman 24 April 2013 

Alan Shipman is a lecturer in Economics at the Open University. He is responsible for the modules You and your money:personal finance in context and Personal investment in an uncertain world,  part of the foundation degree in Financial Services.

The views expressed in this post, as in all posts on Society Matters, are the views of the author, not The Open University.

Cartoon by Catherine Pain 

 

 

Two OU students were successful in the inaugural Psychological Society of Ireland (PSI) essay competition this year. Helen O’Shea, was the winner of the Undergraduate category whilst Kira Kazakova, also an undergraduate, received a commendation for her essay.

The winning entries were published in the Irish Psychologist magazine and the successful entrants will receive a significant contribution towards attending the Annual Congress of Psychology Students which is being held in Dun Laoghaire Institute of Art, Design and Technology (IADT) in April 2013.

Helen O’Shea, winner of the Undergraduate Category, and student of BSc (Honours) Psychology, feels hugely rewarded for the significant efforts she has made to date in her studies. She says of the prize: “It vindicates my choice of course and university... It allows me to move forward to my postgraduate studies with more confidence than I might have had.” Helen’s goal was always to pursue a career in clinical psychology.

“One of my biggest concerns about studying with the OU was that the study was independent rather than normal lectures. This made me wonder how I was going to cope with self-regulated study and would I have the discipline required to achieve a BSc in Psychology. My concerns were quickly allayed when I came to realise the level of support and resources that were available, and in particular the standard and timeliness of communication between the tutors and the students.”

Helen, a wife and mother who says “there was a lot of juggling and late nights” in order to complete her studies, is now a research assistant on the Waterford Mental Health Survey, which is a joint project between the Health Service Executive (South) and University College Dublin.

Kira Kazakova, also an OU undergraduate, received a commendation for her essay. Her aspirations are to complete her BSC (Hons) Psychology with the OU and a Social Care Work degree with Tallaght IT. Her ultimate goal is to become a forensic psychologist.

Kira started her studies when she was working as a Legal Executive, and the OU was the best option for her to combine work and study. One of her major concerns was undertaking a course in English which, at the time she began her studies, was her third language. In addition, when Kira went back to study, she was, and still is, a single mother. “Raising a young child by myself, as well as trying to educate myself, was very tough at times...for three years between 2006-9 I was also working full time as well as studying.”

“I am very pleased to be a runner-up in the Essay Competition and I am very proud to represent the OU in this endeavour.”

Dr Aileen O’Reilly, PSI Graduate Officer and Council Member said “It was wonderful to receive entries from Open University students, and I would encourage more students to enter the competition next year.”

Karen Hagan, Senior Lecturer in Psychology in Ireland says “The Open University is delighted that two students have received awards in the first PSI student essay competition. This shows the high calibre of our students and, indeed, their motivation to succeed.”

Find out more

• Study Psychology at the OU
• Psychological Society of Ireland (PSI)
   

Posted 8 April 2013

 

The OU is a partner in the UK's largest-ever study of poverty and social exclusion, which has just published its first report.

The Impoverishment of the UK report paints a bleak picture of deteriorating living conditions and opportunities for a significant and growing proportion of the population. 

It will be profiled in a special Tonight programme, Breadline Britain, broadcast on ITV tonight Thursday 28 March at 7.30 pm.

The report is part of the Economic and Social Research Council-funded Poverty and Social Exclusion (PSE) study, which uses a way of measuring poverty devised by Joanna Mack, Learning and Teaching producer at the OU, and Stewart Lansley, senior project officer at the OU. 

This PSE approach – now adopted by the UK Government and by a growing number of rich and developing countries – identifies people falling below a publicly-determined minimum standard of living. 

It was pioneered in 1983 and repeated in studies in 1990, 1999, 2002/03 and 2012. The PSE project thus provides detailed and robust information about trends over 30 years. 

Joanna Mack was the principal investigator on the 1983 and 1990 research studies and she is one of the lead investigators for the current research. 

The OU also developed The Poverty and Social Exclusion in the UK website,  which is an integral part of the overall project and which provides a major resource on poverty and social exclusion, used extensively.

Key findings of the PSE report include:

• 33% of the UK population suffers from multiple deprivation. In 1983 the figure was 14 % 
• Almost 18 million people cannot afford adequate housing conditions
• Roughly 14 million cannot afford one or more essential household goods
• Almost 12 million people are too poor to engage in common social activities considered necessary by the majority of the population

Joanna Mack said: “Levels of deprivation today are worse in a number of vital areas – from basic housing to key social activities – than at any point in the past thirty years. 

"These trends are a deeply shocking indictment of 30 years of economic and social policy and reflect a rapid growth in inequality. This has meant that, though the economy has doubled in size during this period, those at the bottom have been increasingly left behind.”

Professor David Gordon of the Townsend Centre for International Poverty Research in Bristol, who is head of the project, said: “The results present a remarkably bleak portrait of life in the UK today and the shrinking opportunities faced by the bottom third of UK society.  

"About one third of people in the UK suffer significant difficulties and about a quarter have an unacceptably low standard of living’ said ‘ Moreover this bleak situation will get worse as benefit levels fall in real term, real wages continue to decline and living standards are further squeezed.” 

You can download The Impoverishment of the UK report here.

Posted 28 March 2013

Around the world there are a number of professions in high demand. The BBC Business website has compiled a list of the top 20 most wanted professions internationally, and the countries that want them.

The list includes psychologists, physiotherapists and chefs, and there are case studies.

Is your profession there? Check it out on Global migrants: Which is the most wanted profession?

Children in Britain are more exposed to alcohol marketing than adults are, according to the OU's Professor of Social Marketing Gerard Hastings.

He calls for urgent changes to Britain's 'flawed' drinks advertising regulations in an editorial in the British Medical Journal, which is published to coincide with a major report calling for all alcohol advertising to be banned.

The editorial cites research by the Rand Corporation for the European Commission which shows that 10-15 year olds in the UK see 10% more alcohol advertising on TV than their parents do. When it comes to alcopops, they see 50% more.

And the situation is set to worsen as advertisers increasingly spread their messages via digital media, say Gerard Hastings and co-author Nich Sheron, clinical hepatologist at the University of Southampton.

Their comments coincide with the publication of Health First: an evidence-based alcohol strategy for the UK, a report which calls for a ban on all alcohol advertising, and minimum alcohol pricing. Gerard Hastings is a member of the strategy group which compiled the report.

To see Gerard Hastings discussing the proposed strategy with Professor Linda Bauld, University of Stirling, go to this link. 

Further information

Professor Gerard Hastings is a member of The Open University's Centre for Strategy and Marketing. He is founder/director of the Institute for Social Marketing and Centre for Tobacco Control Research based at Stirling University and The Open University. He is currently leading APISE, a major study of the effectiveness of alcohol control policies.

The British Medical Journal editorial Alcohol Marketing: Grooming the Next Generation was published on 1 March. Current OU students can access it via the OU Library using their Open University Computer Username (OUCU) and password. Its reference is BMJ 2013;346:f1227. For help in accessing electronic journals through the OU Library database go to How can I get access to a particular journal on the Library website.

Posted 26 March 2013

 

Image: Thinkstock

A new OU/BBC series captures a day in the life of one of the world's largest publicly-funded health services.

Keeping Britain Alive: The NHS in a Day is an epic eight-part observational documentary starting Tuesday 26 March at 9pm on BBC2.

It tells the stories of a single 24-hour period in the NHS from a multitude of perspectives, following a diverse range of staff, and patients. 

The OU team working on the series say it is of particular interest to Health and Social Care students, as it takes a broad view of health care delivery that moves beyond the ‘typical’ doctor-led focus in acute care to explore the relationships between service users and providers.

OU academic advising on the series are Dr Carol Komaromy and Dr Jonathan Leach. 

Explore further
Check out the OpenLearn series page online interactive feature  telling the story of the changing nature of health care from before the birth of the NHS to the present day.

There is a booklet associated with the series, Working to Save Lives, which gives a personal view of day-to-day life as an NHS healthcare professional. For a free copy, call 0845 271 0015 or go to the OpenLearn page.

More information

• Health and social care courses and qualifications at the OU

 

Posted 25 March 2013 

Ever had your enjoyment at a live performance spoilt by collective coughing fits from the audience? The theatre critic James Agate once reflected: 'Long experience has taught me that in England nobody goes to the theatre unless he or she has bronchitis.' 
 
I once played Albert the Horse in Alan Bennett's lovely adaptation of The Wind in the Willows and during every matinee I was forced to neigh disapprovingly at children whooping loudly every time my wise old talking horse was about to save Toad from another disaster. Rumour has it that the cast of The Sound of Music referred to the show as The Sound of Mucus, so deafening were the coughs and sneezes coming from the auditorium during every performance. The concert hall too is notorious for audience participation, sometimes of the wrong kind. Alfred Brendel, the pianist, once chastised his audience: 'either you stop coughing or I stop playing.' 
 
Now we might know why people cough in auditoriums.  In a new report entitled Why do people (not) cough in concerts? The economics of concert etiquette, (see story here) Professor Andreas Wagner of the University of Hannover claims that coughing is 'excessive and non random'. Coughing is seen as an acceptable form of audience participation by many participants. Coughing is a 'wilful action'.
 
The research revealed that the average concertgoer coughs at 0.025 times a minute, a rate double the normal average of 18 coughs a day. 
 
I am sure we all have sympathy with Downton Abbey author and screenwriter Julian Fellowes who famously, last year, explosively rebuked a fellow audience member who was coughing persistently in the next row at the Royal Court in London. 'You must stop coughing', he barked. After the outburst you could not hear a pin drop, only the actors on the stage.
Dick Skellington 22 March 2013

The views expressed in this post, as in all posts on Society Matters, are the views of the author, not The Open University.

Cartoon by Gary Edwards

More than 109,000 people have taken part in the BBC Lab UK’s Big Money Test which was launched in April 2011 by money saving expert Martin Lewis.

The OU’s Professor Mark Fenton-O’Creevy, together with fellow academics Professor Adrian Furnham and Dr Sophie von Stumm, reveal what they learned from the results.  It's clear that there is far more to managing your money than just financial know-how.

Key discoveries:

• While financial knowledge is important, our emotions play a big part in how well we manage our money
• Money makes many people feel worried, guilty and anxious
• Impulse shopping can lead to disastrous financial problems
• If money makes you feel powerful you are more likely to encounter money problems, but if money makes you feel secure you are less likely to
• Being able to make ends meet is crucial for us to be able to manage our money well, more so than financial knowledge
• Attitude to money and financial success tend to improve with age, even more so for men than women

Read the results in full.

Find out more:

• Check out OpenLearn's You and your money
• Read Professor Fenton-O'Creevy's blog on emotional finance
• Professor Mark Fenton-O’Creevy

Posted: 20 March 2013 

Meg Barker looks a little deeper at what can be done to alleviate human suffering

I gave a talk recently at the University of East Anglia on the history of self help books. I wanted to understand far more about why they came to be the way they are. I also managed to chart one potential future trajectory of self-help, building on this criticism. For this I particularly considered the writing of Oliver Burkeman: one of my favourite discoveries over the last couple of months thanks to his entertaining and radically different approach. I'll outline some of his ideas here so that you can see what an alternative to conventional self-help might look like. You can view the presentation I gave here.

Self-help history: empowerment or victimisation
Examining the history of self-help we can see that books in this genre have tended to be of two types. The first type – empowerment self-help – emerged in America after the great depression and drew on the New Thought movement which believed in the power of positive thinking. Such books held out the promise that by imagining good things and striking the right attitude people could bring what they wanted to themselves: wealth, friends, success, etc. The second type of self-help became popular in the late sixties and seventies. Know as victimisation self-help, books in this category tend to blame the wider world for any problems that individuals have. Akin to the twelve step programmes for addiction, these books are concerned with reassuring readers that their difficulties are not their fault but down to something beyond their control like having toxic parents or a disorder or disease of some kind. Power is located outside the individual. 

In the 1980s and 1990s there was a backlash against victimisation self-help and a return to an extreme form of empowerment self-help which argued that any problems were down to the individual and could be fixed by positive thinking. For example, a quote in the bestseller The Secret by the author's fellow self-help writer, Bob Proctor, says: “Why do you think that 1 percent of the population earns around 96 percent of all the money that’s being earned? Do you think that’s an accident? It’s designed that way. They understand something. They understand The Secret, and now you are being introduced to The Secret.” The Secret in question is the New Thought law of attraction, that successful people bring positive things to themselves merely by thinking about them.

Both these forms of self-help are problematic, and together they set up a false binary around human struggles, which is similar to the either/or view of mental health which I've discussed elsewhere. It seems that we have to believe either that we are personally responsible for all our problems but that we can fix them by changing ourselves, or that the world is responsible for all our problems but that we are powerless then to do anything about them. If we buy into the empowerment way of seeing things then it easily slips into victim blame, whereby we regard everyone, including ourselves, as to blame for any problems in life. If we buy into the victimisation way of seeing things then we have to believe that there is something fundamentally wrong with us and give up any sense that we could do anything about our difficulties.

A third way? Oliver Burkeman
In recent years it seems that a few authors have been looking for a kind of third way of doing self-help: a way that involves breaking out of this problematic binary. What I have called anti-self-help self-help starts from a criticism of the assumptions of the self-help movement in general. It asks questions about whether it is actually good to strive for the things that self-help suggests that we strive for: happiness, wealth, success, a romantic relationship, etc. Are these good things to have and, even if they are, is striving for them the best way of going about it? Anti-self-help self-help locates any problems that we have in the wider society that surrounds us, the messages we receive from it, and how we relate to these, rather than seeing us as isolated individuals responsible for everything that happens to us. But, at the same time, it sees us as actively engaged with this wider world and able to engage with it in different ways, rather than as powerless. 

A great example of such anti-self-help self-help is the writing of Oliver Burkeman. Like his Guardian newspaper column, This Column Will Change Your Life, his first book Help! presented an analysis of existing self-help books, attempting to pull out actually useful suggestions from the overwhelming mass of contradictory messages that he found. His second book, The Antidote, builds on the criticisms of self-help that he came to when writing Help! and suggests a radically different approach. 

Positive thinking, argues Burkeman, actually makes us suffer. The empowerment self-help movement has got it completely wrong. What he offers in its place refuses the disempowering position of victimisation self-help, but instead embraces the potentials of what he calls a 'negative path'. This draws on a cluster of approaches taken from philosophies from Buddhism to Eckhart Tolle, the Stoics of Ancient Greece to the Mexican Day of the Dead. What these have in common is that they all do the opposite of 'positive thinking', instead turning to face the difficult stuff of life.

Thus Burkeman argues for the benefits of meditating on the inevitable fact of our own mortality. He critically evaluates the way in which we tend to react to 'bad things' in our day-to-day life, and considers alternatives where we recognise our own role in categorising what is good and bad and trying to get all of the former and none of the latter. He explores meditation and building the capacity to be with difficult feelings, turning towards the things that scare us rather than away from them. He considers the power of just getting on with tasks we are avoiding, rather than assuming that we have to 'find our passion' or 'get motivated' before we can do anything. He explores the value in considering the worst that could happen (and whether what is happening is 'just bad' or 'absolutely terrible') as well as asking yourself whether you have a problem right now, in the present moment. He questions who this self is that we are trying to improve through self-help, and wonders whether it might be more useful to reflect on whether such a thing really exists in any meaningful sense, rather than assuming that it does and engaging in a futile quest to make it better.

I loved The Antidote because it resonates so well with the answers (and – perhaps more usefully – questions) that I have come to through my own journey through the ways in which psychology, psychotherapy, philosophy, and sociology have understood human suffering and what can be done about it. Like my work, the book is particularly rooted in Buddhist philosophy and it is very nice to see that engaged with so thoughtfully, rather than just being offered as another set of techniques to make people happier.

The anti-self-help self-help manifesto
Where to from here? I would like to see many more anti-self-help self-help books which start from a critical stance towards the self-help industry and offer something more valuable to people who want to think about how they are living and how they might do it differently. Such work would, I think, share some of the following things in common:

• A critical stance towards conventional self-help

• A critical stance towards normative taken-for-granted ideas about what makes a good person and a successful life, and whether happiness and wealth are the best things to be striving for

• An informed understanding of the problems with telling people that they are flawed in some way and need to change by striving after something different

• Drawing on research evidence from psychology and sociology, as well as philosophical understandings from across the globe (not just the 'west'), in order to suggest what might be helpful to people

• Locating people's problems in the inter-relation between them and the world around them rather than entirely internally or entirely external – regarding people as biopsychosocial beings rather than focusing on one of those aspects (bio, psycho, social) to the exclusion of the others

• Suggesting ways forward which involve engaging with the world differently, and recognising how difficult this can be and arguing for wider social change, rather than putting all responsibility on the individual

• An ethical commitment to putting something different 'out there' even though the publishing industry conservatively continues to try to publish the same kinds of messages as before

I'd be very interested to hear from others who are trying to write blogs, books, articles, etc. in this vein, and to continue to discuss whether a 'negative path' or 'anti-self-help' does present a valuable third way.

Find out more
There is more about self-help with useful links to other work here. 

Meg Barker 7 March 2013
Meg Barker is an Open University lecturer teaching mainly on counselling modules, and is also a therapist specialising in relationships. Find her other blogs here. 

The views expressed in this post, as in all posts on Society Matters, are the views of the author, not The Open University.

Cartoon by Catherine Pain