Economic Policy Review ISSN 1313 - 0544

Riots and Social Benefits

Author: Krassen Stanchev / 21.10.2011
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 „…There are things that are badly wrong in our society”.

David Cameron

 

Here are two passages describing the riots that happened in London.

  • “These people are actually attacking communities, businesses, private property, houses and in reality they do cause high crime and worries” (Adrian Hanstock, Metropolitan Police)
  • “Obviously, there are people in this city that, unfortunately, have intrinsic motivation toward violence. They are looking for any occasions to steal, strike and cause confusion and despair, regardless of whether they are anarchists, gang members or simply uncivilized youths that dream for a new pairs of sneakers” (Kit Malthouse, Deputy Mayor of London, Policing).  

 

What is happening in London and other British cities is yet to be taken under consideration. So far, nobody pays attention to the unintended consequences, resulting from the social framework in the UK.

Everybody that has been in Tottenham or in similar London’s neighborhoods could not omit the fact that these people are unemployed and live mostly upon social benefits. This is also true for the unfortunate person murdered by the police – something that ignited the riots.

 

Here are some characteristics of the UK welfare state that can lead us to better understand the current situation:

  • The social benefits are fixed at levels that provide miserable existence;
  • Their distribution is not linked with the principle “work first” which is to be the case in the New York and other metropolitans in the USA. Here we can include Los Angeles, where this principle was introduced after analogical (but not the same) events some 10 years ago;
  • The profession of “living on social benefits” is well known in the country since the middle of nineteenth century when the requirements to be “searching” for a job were introduced. In the last 15-20 years these requirements were relieved by the Labor party;
  • The minimal wage in Britain is almost as big as in Bulgaria – 41% from the average level. This does not ease the process of job searching in spite of the fact that UK labor market is much freer than ours (By the way, the minimum wage in Bulgaria is about to be increased in correspondence with the tradition to be administratively lifted without linkage with the labor productivity, which is not to be the case in UK);
  • The criminalized trading and usage of drugs in UK is causing the formation of criminal gangs; many descendants of immigrants find easily their occupation in this not so well paid profession (at lower level);
  • The new generation of immigrants descendants do not keep in mind their parents memories. They do not understand that the social benefits make them much better off from their native countries; they take the social benefits for granted and not as a rescue from the poverty.

 

Social problems started threatening Britain’s public order since the time of Henry VIII as a consequence of Monastery’s nationalization. Later on, these problems were solved with the emerging of the capitalism and the industrialization from the end of the XVIII and XIX century[1]. After the adoption of Bismarck’s model of welfare state from Germany, laziness and total disrespect to other’s people labor and property became some of the “wrongly mistaken” characters of the British society[2].

The case is quite typical, but this is not a relief…

 


[1] Jeffrey G Williamson, Did British Capitalism Breed Inequality?, Boston: Allen and Unwin, 1985. Chaps. 1–4.

[2] James Bartholomew, The Welfare State Were In, IME Library or: http://www.thewelfarestatewerein.com/about