The New Aristocracy and the Poor

Hypocrisy comes by the shovel–full in the adversarial politics that passes for “democracy”. The latest dose came when Britain’s House of Lords had the cheek to intervene in David Cameron’s plan to dismantle the Welfare State in favour of a free-for-all labour market.

Mr Cameron claims to be a One-Nation Conservative who wishes to raise people’s living standards by ordaining a new Living Wage. That “living wage” does not deliver a living wage in the UK, 2015, of course; and it will not be sufficient to offset the cuts in the welfare provisions that are currently planned by his government.

Chancellor of the Exchequer George Osborne is determined to cut the welfare bill. His cover story is that he wants to “balance the books” – cut the government’s deficit. His ideological turn-of-mind is exposed by his determination to achieve “fiscal responsibility” by raising the generous provisions for asset-rich voters (who support the Tories) while cutting welfare grants to low-income families.

So when the House of Lords intervened last week to disrupt Osborne’s plans, all hell broke loose. One hypocrite was the former Tory foreign minister, William Hague. He is about to be elevated to the Lords. Writing in the Daily Telegraph (October 28), he vilified the Liberal lords for voting against the government’s welfare-cutting plans.

In 1911, the Lords were legally banned from blocking finance bills. But last week the Lords did not voting on a finance bill. For some reason best known to Osborne, the government chose to try and shove through its savage cuts on low-income families outside the terms of a finance bill. So their lordships chose to strike. Enter the sanctimonious William Hague.

“My old Liberal friends in the last Cabinet were fond of the word ‘principle’ and never happier than when they could attach it to the word ‘constitutional’. And the idea that matters of taxation are solely for the elected house of our Parliament to decide is a constitutional principle of the UK if ever there was one.”

Why, back in 1909, was action taken to shackle their lordships? The people of the UK had mandated a reform of taxation, and their proposals were embodied in The People’s Budget. The Conservatives in both houses fought to prevent the implementation of that budget, which sought to fund new welfare provisions (for the aged and unemployed) out of the nation’s rents. The Parliament Act was passed in 1911 to prevent their lordships intervening in future finance bills. But that did not stop the Tories from continuing with their historic mission – to shift taxes onto working people, giving them the financial scope to further enrich the owners of land.

Today, the politically influential group of land owners are not their lordships. Hereditary peers were removed from the House of Lords a few years ago. The new landed elites are the “hard working middle class home owners”. They fiercely protect the windfall gains reaped through the housing market. And Mr Osborne is dedicated to further enriching that group of citizens, even at the expense of the vulnerable.

The Office of National Statistics, outlining the results of its latest analysis on October 28, reported that workers are still poorer than they were when the financial crisis struck in 2007/8. Residential land owning pensioners, however, are much better off in terms of spending power – and that is without taking into account the rise in the value of their homes.

The Welfare State may need to be reformed. The post-World War II settlement transformed millions of families into dependents on the State. But cutting the income transfers received by vulnerable families without ensuring that they can make up the difference through an increase in wages is not the way to achieve that outcome.

It is one of the exquisite ironies of our times that the effective champions of the working poor are not members of the House of Commons. They are members of the new aristocracy.