Gibbons and welfare

by zebra on 5 June 2011 · 0 comments

Regular contributor James Glover, aka Zebra, returns in a post that manages to combine gibbons, tax and a beer coaster.

A question I often ask myself is how could gibbons possibly develop a civilisation comparable to our own? Gibbons are solitary creatures so do not form troops, groups or tribes. Developing and passing on knowledge in a gibbon society is therefore a long and chancey game. I imagine the gibbon equivalent of an Einstein stumbling upon a rock scratched by a long-dead gibbon Newton and after much pondering leaving his own scratchings to be found by some future generation’s gibbon Hawking. Actually, they are more likely to be the gibbon equivalent of Marie and Pierre Curie since gibbons pair-bond for life. They live in large open ranges well away from other gibbons. That loud “woop-woop-woop” you hear in zoos is the gibbon call for “get ‘orf my land”. It seems though that, bar an unlikely series of genius offspring, gibbons will never develop the tools and technology that could one day put a gibbon on the moon. And it seems equally unlikely that gibbons will ever develop a system of mutually supportative taxation either.

My point here is that income tax, and indeed all tax, is inextricably tied to the social nature of our species. To even conceptualise that there are many to take from and some to give back to requires more than two fruit/income-sharing individuals. Many people argue that taxes represent a crushing of the individualistic spirit of our species. I would rather say that it’s a celebration of our social nature.

There is a vocal minority which claims that there is nothing which taxes provide that could not be more efficiently provided by private enterprise, including the sine qua non of socialist governments, welfare. And they appear to have been proved to be right in the last few decades, which saw the privatisation of parts of government that were once thought to be unprivatisable, including national banks, utilities and prisons.

Yet we live in a society in which many people, while opposed to the specific taxing of the underprivileged (i.e. “me”), are happy to receive the benefits of taxation. There are, in my opinion, two types of taxation benefits. Firstly those which we are all equally able, at least in theory, to enjoy such as roads, schools and defence. And then those which are “targeted towards the needy”, as the phrase goes. As the genuinely needy diminish in numbers, the number receiving what is now called “middle class welfare” increases.

CoingsIn the recent furore over middle-class welfare it is frequently (but wrongly) stated that there is no point in child care payments to the middle classes. It is argued that since it is they who pay the majority of income tax (their greater numbers mean their tax payments are more in aggregate than those of the highest income earners) then the money just goes around in circles pointlessly. In fact there are very good reasons for making these child care payments. Even if everyone in society paid precisely the same amount in income tax and had exactly 2 children, to tax all and pay some is effectively taxing our younger and older years when we don’t have children to support. This tax is then reallocated to our middle years to subsidise the increased costs of raising children before they leave home. That doesn’t seem like such an outrageous idea and presumably is the basis behind the reasoning of those allegedly loony socialists, the Scandinavians, who pay generous child care support to all but the very wealthy.

This does not mean that in our society, where income inequalities do exist, that everyone should receive child benefit. There are clearly people who are very well off and do not need to be subsidised by their younger or older selves so it is inefficient to do so. It just means that the income cutoff is higher for child benefit than for other forms of welfare.

In Australia in the debate about middle-class welfare, which has been spurred on by the recent budget, the battle line has been drawn at a household income of $150,000 a year. An editorial in The Sunday Age (May 1 2011) made the claim that welfare in Australia was well-targeted because the top 40% of households only received 4.6% of the welfare budget. So I decided to run the beer coaster over some numbers. With the help of Google, I estimate a total welfare budget of $110 billion. This is made up of $60 billion in unemployment benefits (600,000 unemployed at about $10,000 per year on Jobstart) and $20 billion on the Disability Support Pension which pays about double the dole but requires more stringent eligibility tests. On top of this, about $30 billion is paid on child care and family benefits. Taking 4.6% of this $110 billion gives about $5 billion per year. Enough to build a couple of new hospitals and several schools and staff them with 5,000 teachers and nurses. Or indeed enough to invade a medium sized Middle-Eastern country. If you use my usual back-of-the-beer-coaster figure of 8 million households in Australia, then that is about $1,600 for the top 40% or highest income 3 million households. I can’t think what they need to spend it on. Although, as I noted in a letter to The Sunday Age in response to their editorial, this figure is coincidentally about the cost of a premium family subscription to Foxtel.

Gibbons also have children and the way they get them to leave the home patch of jungle is to ignore them more and more and then eventually treat them like strangers and shout at them to go away. This is the reverse of the process followed by humans, whereby the maturing children ignore their parents and then shout at them to go away before abruptly leaving home. I believe it is in our solitary versus social natures that an explanation lies for why the approaches of gibbons and humans to both child-rearing and taxation differ so much.

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