At first, discharge would mean being flung back into the whirlpool of competition, a fate not lightly to be challenged. Later, as the private enterprises succumbed to the competition of the Commune, it would mean almost hopelessness of attaining a livelihood. When social reorganization is complete, it would mean absolute starvation. And as the starvation would be deliberately incurred and voluntarily undergone, it would meet with no sympathy and no relief.
In other words, the new order would achieve that elusive object of all British reforms affecting the lives of workers, the isolation and elimination of the unworthy poor, worthiness, as always, determined by economic productivity as they chose to define it.
Competition for work cheapens the cost of labor and prevents it from rising in value when demand for workers increases. So the unemployed contributed, after their fashion, a fact grudgingly acknowledged in whatever tolerance they enjoyed. It is not irrelevant to my larger purposes to point out here how little awe there is for human life among these philanthropists or in the tradition they inherit. Human life is weighed routinely in the scales of simple commerce.
Shaw himself, decades later, fulsomely praised the head of Stalin’s secret police, whose picture he kept on his mantel, for having shot an inefficient railroad worker. Shaw expounded on the merits of extermination as a feature of social policy during the formative stages of Russian socialism and German National Socialism, visiting Hitler and Stalin with praise and advice and the prestige of his Nobel-decorated person. For some reason his and the Webbs’ enthusiasm for authoritarian movements has always been interpreted as a misreading by them of the nature of these movements. Yet it would not be difficult to defend Shaw’s statement that Stalin was a good Fabian, his Soviet labor camps being item one. In Shaw’s introduction to his late play, On the Rocks, his enthusiasm for extermination actually recommends the policies of Stalin and the National Socialists to him. For some reason, Shaw has emerged from these involvements reputation intact. He is an acerbic wit, we chortle at his outrageousness. In terms of his own tradition, his views on this issue are not exceptional. In 1839 Thomas Carlyle wrote, “The time has come when the Irish population must either be improved a little, or else exterminated.”
It is difficult to absorb the fact that definitions of goodness, justice, and right vary wildly, especially difficult since we think and speak as though the “West” had reached profound consensus about these things through a long evolution, and was now unanimous in its loyalty to certain values — which were, it is true, swept away in a sort of mud slide of unhealthy enthusiasms only fifty years ago, an event that remains totally inexplicable so long as we insist that “Western values” include a steady faith in the importance of individual freedom and human life.
Because Americans believe that there are such things as “Western values” and that these are identical with their own best impulses, they cannot recognize the real content of the ideas carried along in history, though these ideas have blossomed in events and institutions such as the poorhouse, slavery, the penal colonies in Australia and elsewhere, labor camps for social parasites, and the extermination of unvalued people. I place Sellafield among these manifestations, because it is comparable in nature and in scale.
With the establishment of the Welfare State words of consecration were spoken over truly ancient mechanisms for maximizing profit, stabilizing social relations, and at the same time clothing the state in the garments of benevolence yet again.
William Beveridge, whose Plan for the Welfare State led to his being called the “father” of the new postwar Britain, merely amended Poor Law by absorbing the insurance systems that had been set up by working-class groups and labor unions into a system called National Insurance, taking the rates of benefit from those already established by the very poor to hedge against disaster. This policy was suggested as early as 1786, in A Dissertation on the Poor Laws by Joseph Townsend. Of course, the levels of benefit contrived by the necessitous to see them through their darkest hours were not generous. Benefits financed out of contributions or deductions from the pay of people so situated that they had to brace against the eventuality of a three-pound funeral were necessarily minimal. Beveridge’s innovation, the conceit of calling the state the insurer, meant simply that taxes would take the place of insurance payments. Contribution would no longer be made at the earner’s discretion. These changes infuriated private insurance companies, some of which had grown very great from this modest base.
The problem of poverty, as it was understood by William Beveridge, interpreting a survey by Seebohm Rowntree of the poor in the city of York in 1901, was, needless to say, nothing so simple as lack of money. It was that income was unevenly distributed throughout a worker’s life. He (using a male instance, as Rowntree did) was poor as a child too young to work, better off when he and his siblings could work to help their parents, poor when he had young children, better off when they were old enough to work, and poor again when he passed the age of employability, usually at about forty. It was Beveridge’s idea — Rowntree protested against it — that the problem to be solved was the uneven distribution of money over these five stages of the worker’s life. The “excess” of earning in his more prosperous periods should somehow be made to provide for him in the periods when his income fell below subsistence level. (Beveridge adopted Rowntree’s definition of subsistence as being able to live without sustaining physical damage on an income devoted entirely to the purchase of necessities, very strictly defined.) Rowntree wrote a critique of the Beveridge Plan, arguing that many of those who fell below his standard of subsistence were fully employed families whose situation was the simple consequence of low pay. He urged a minimum wage — to no avail, of course.8
A tax system like Beveridge’s, which withholds a substantial portion of even small incomes, to pay it back again as Child Benefit, Housing Allowance, unemployment compensation, medical care, old age pension, and so on, is a solution to what British reformers have always seen as the improvidence of the working class, who used their spare money, in the best times, on pleasures and comforts — tobacco, tea, clothing, and drink — and, as Beveridge noted, on movies, where, as Orwell noted, they often went to stay warm. This is the sort of excess to be squeezed out by “redistribution of income,” which in British parlance means the reapportioning of income through a single worker’s life, not from the more to the less well off.
Taxation regularized the insurance system, at least to the extent that participation was made universal among employed people at a certain wage level. What it omitted to do was to guarantee a return on the investment at any specific rate. The British government turns a profit on the National Insurance System, which goes into the treasury. So those who pay into National Insurance are taxed at a rate that subsidizes other activities of government rather than enhancing services or lowering rates of contribution. This merely reflects the larger fact that, in guaranteeing subsistence, Beveridge designed a system which would yield neither less nor more. Only against a history of severe deprivation could such an arrangement be called a Welfare State. Only a history of unlimited expropriation would make the Beveridge Plan read as a promise rather than a threat. Yet, a true descendant of the Poor Law, this system is treated as generosity so wanton as to have virtually destroyed the national character.
But the fact that there is in the system no guaranteed rate of return on contributions introduces the flexibility which allows the government to control the rate of real wages. In the nineteenth century, industrial employers could pay wages in kind. A worker might receive as pay a quantity of cloth of a very poor quality, and unsalable. This practice was one means — there were many — by which the employer could depress the cost of labor. The British government, by maintaining a level of service below the money value paid for the services, depresses the real wage of workers by selectively depressing the value of what the worker receives in lieu of money withheld in insurance contributions. The Welfare State is descended from the Company Store.