It’s official. You’re 500 billion times more likely to be bailed out if you’re a banker than if you’re a single mother.
A case in point is David Freud, ex-investment banker and government advisor on welfare reform.
Having got rich in the City, he spent all of three weeks on the first draft of his welfare reform report to the government. In an interview with the Daily Telegraph he bragged, “I didn’t know anything about welfare at all when I started, but that may have been an advantage.”
The result is that, from 24 November, all single parents whose youngest child is aged 12 or above (to be reduced to seven by 2010) have not been able to make a new claim for income support.
Those already claiming will have changes phased in next year.
Lone parents—90 percent of them women—will now have to look for work or face a 40 percent cut in their benefits. This, we are told, is in the interest of eradicating child poverty.
The idea is that mothers who work will have more money so their children will be less poor.
This could be true if single mothers had access to flexible, well-paid work and equally flexible, quality childcare.
Even David Freud should know that this tends not to be the case in Britain.
And perhaps he doesn’t understand that raising a child is a job in itself. Bankers wouldn’t do it for less than a six figure salary but mothers are expected to do it as a hobby.
Freud’s proposals were modelled on the “Wisconsin Reforms”, which are said to have reduced the numbers of welfare recipients in parts of the US state by 80 percent or more.
This has been well received by the US government and, where the US leads, Britain follows.
But Freud has added a twist to the British system. Welfare is to be outsourced to private companies who get paid by results.
That means the more claimants they get off the government’s figures the more profit they make. Good news for capitalists, but not so good for those at the receiving end.
Milwaukee, which adopted the “Wisconsin Works” (W2) model in 2000, saw infant mortality rise by 17.6 percent in its first year, according to “Start Smart Milwaukee”, a child advocacy group.
In Wisconsin itself, many single mothers who had their welfare payments cut became homeless.
According to a local landlord organisation, the number of forcible evictions increased from 700 a year before W2 to well over 2,000 after.
It pleases governments that single mothers, convenient scapegoats for all manner of social ills, can now be taken off the public balance sheet and transferred to private companies who can exploit them for profit.
And increases in child mortality are certainly one answer to child poverty. Alternatives usually cost money.
Research by the University of Houston in 2007 concludes that, “States with the most generous, inclusive, and supportive welfare programmes have done the best job at lowering and containing child poverty.”
This is not what governments and investment bankers like to hear. After all, if money is spent on welfare, who will bail out the banks?
Carola Becker is a campaigner on welfare issues