Welfare as a stick for conservatives

Money is a necessity in society. It's our agreed upon standard for facilitating most transactions. This fact alone justifies the need for welfare, because without it people cannot function in our society.

Its necessity doesn't mean it's well catered for, however, with crackdowns frequent and even modest increases being politically untenable on either side of politics. I used to think that it was because they're an easy target - a group that can be demonised who have little recourse to fight back - but I think that explanation excludes the basic moral impulses in play. Rather the unfairness of getting something for nothing makes them an easy target.

In short, there is a tension between the necessity of welfare and the perceived unfairness of a welfare state.

People can, if they choose to, live their whole life without needing to work, which requires that others in the society do the so-called heavy lifting. The welfare rhetoric often focuses on abuse of the system for this reason, even if those abuses are rare and end up affecting those who aren't abusing the system.

This is why programs to restrict welfare to the deserving are part of populist politics, irrespective of whether it provides good societal outcomes. Drug testing welfare recipients is one policy that's expensive, counter-productive, yet gets popular support. After all, drugs are illegal, and welfare is meant to look after individuals. Cards that restrict purchases or even food stamps are another. They are the tacit recognition that welfare is necessary but that out shouldn't go beyond that.

The current contention over welfare in Australia currently is that the rate is so low that it's not even performing its necessary function. Again, for conservatives, this is a good thing because it means welfare shouldn't be relied upon, so it should only be used as a last resort. Combine this with the complaint that welfare recipients find ways to get on higher payments (such as disability pensions, which again get repeated crackdowns) or that they are supplementing their income without declaring (see: robodebt) and we've got a punitive system that makes it harder for those on welfare to survive.

Yet all these measures don't address some of the problems associated with unemployment. People in vulnerable jobs can be exploited. Long-term unemployed have weakened job prospects. There can never be full employment, and many who work now are underemployed. No amount of sticks within the welfare system are going to change that.

Instead, what is needed are practical steps to overcoming barriers for entry. There needs to be better support to get people into work, from better training, to employer incentives. These should be driven by practical results.

At the same time, we really need to change how we view welfare from a handout to the ability to participate in society. This would be more in line with the role welfare plays in a society, allowing for economic activity. Money given to welfare tends to go back into the economy, so the money isn't being lost, but encouraging economic engagement.

So when the the rate jobseekers get remains stagnant while the cost of living goes up, the outcome will be pushing more people into deeper poverty. The stick methods may be a deterrent effect for people in crappy jobs not to quit and live off welfare, but it's not going to get many people off welfare without other changes that make it easier to work. The necessary function of welfare needs to be depoliticised because of how easy it is to perceive it as a straightforward unfairness problem.

The Shift To Digital Sales

I was disappointed to read that Green Man Gaming - a digital games website - has decided to join the list of online retailers that support the Australian publishing industry's price-gauging of Australian consumers. It did so, it claims, because the publisher was put under pressure by an Australian retailer.

Hi - we have had a number of enquiries about price increases on Borderlands 2 and XCOM Enemy Unknown in Australia and New Zealand. This was done at the request of the publisher based on local retailer feedback. We would rather not have had to do this but we really value the relationship with our publishing partner.

I'm not faulting Green Man Gaming for this (though it will mean that I won't be getting BioShock Infinite from them given it's a 2K title), but it is disappointing that once again the Australian consumer is being punished for choosing an alternative option to physical product. Especially, too, that the move is in response to a physical distributor putting pressure on the publishing company.

The thing is, the more that I see the possibilities of digital distribution, the more I wonder what the need for physical distribution is any more. It seems that I'm not the only one wondering this, and that its enough of a concern for the physical distribution chain to manipulate the market to justify its own existence.

There are two different ways in which this practice seems unfair. The first is that we as consumers are being punished for choosing differently to the status quo. The retail chain cannot compete in the retail market as it stands, so instead of shifting to cater for the new demand, it is manipulating the market to make it the least unattractive option for buying an attractive product. The second is that by doing this, it perpetuates the high prices that Australians are forced to pay for games.

I want to support gaming, and as a consumer my way of doing this is to pay for products. If I want to see more games being made, I need to pay for existing games. Yet local publishing rights and retail chains are relics of a pre-Internet era; I no more need them than I need Australian book publishers if its going to be cheaper to get books sent from the UK than to buy locally. They are just a price-gauger between me and my gaming.

A long article was recently published on why it is game prices won't go lower for Australians. It's a good read, but what struck me was this line from an anonymous source:

"People complain so much [about game prices in Australia] but they still go out and buy the games. It's a lot of noise but very little action. If consumers got fed up with paying so much for games in this country, they'd stop buying them altogether, both at retail and digitally. But that hasn't happened on a mass scale yet."

There's no question that games are an in-demand product. Yet stores like Green Man Gaming are a way for people to have their displeasure recorded as more than just noise. If it weren't that people were looking for cheaper online alternatives, then why would retail chains and publishers be worried about the online presence? Otherwise voicing our displeasure is all we can do. And as one who has stopped buying games when they are being price-gauged*, it's disappointing that an alternative to abstaining altogether is being taken away.

I'm happy to pay for games, I'm not happy to be ripped-off because I need to support an outdated distribution model. People using Green Man Gaming (as opposed to acquiring the games illegally) was a legitimate way of expressing displeasure at the current state of retail in Australia. For me, the hunt is on for another GMG equivalent until the eventual (yet sadly prolonged) death of those archaic retail chains. I'm just glad that I was able to pick up XCOM Enemy Unknown when I did off GMG, as its a great game and well worth supporting.

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*Fallout New Vegas, Civilization V, RAGE, Diablo III, Max Payne 3, and Farcry 3 are all AAA titles that have been lost sales due to price-gauging. I've been happy to wait until they're bargain bin and on massive discount before purchasing.

Who Pays For All This? A Review Of Inside Job

When poker machine legislation was being proposed in Australia, despite the harm that poker machines can do, the legislation would not have outlawed poker machine use. Indeed, very few people who used poker machines would be affected by it at all. The proposed legislation was targeted specifically at problem gamblers, and predominantly the rules would have helped to limit the damage that problem gamblers could do. The response was a targeted campaign against the government, that it would damage clubs and communities, and that the government was being a nanny state trying to restrict our freedoms. If a few lives needed to be wrecked so that clubs could take in as much money as possible, so be it.


Inside Job is a look at the financial services industry and the practices that were said to lead up to the global financial crisis. The lack of regulatory oversight was the central theme; starting with the story of Iceland's banking sector then moving onto the major players in the American story. It's the story of greed, excess, risk-taking, and the complete lack of any regulation on the industry. Even when companies were violating what little regulation there was, the regulators didn't do anything about it.

A movie like this isn't going to be able to tell a complete or detailed account of the events. It's good in how it presents the information, though as to its economic accuracy I cannot verify. It did very little in the way of offering practical advice, so it differed in the hopeful manner of An Inconvenient Truth. The question is left as to why the government is doing nothing about this, which leaves a somewhat bitter taste. The message: we're fucked and the people who fucked us are still there fucking us, and worst of all the people in charge are oblivious (or at the very least indifferent) as to how they are fucking us.

For me, though, the worst part was the lengths at which those in the financial industry went to denying that a problem even existed, let alone whether or not their practices needed to change. It reminded me of the personality types described in The Authoritarians, people who were apologists for the power structures and practices irrespective of their merits. The film tried to paint them as slaves to ideologies, unable to see the world any other way than the failed way in which they adhere to. Whether or not that's accurate, that the people who had a strong influence couldn't even answer in the affirmative about a simple conflict of interest question doesn't leave me with much hope for the future of the financial industry. That these corporations could lawyer up, had people in high places, and had people who would defend their interests no matter what is chilling. It got me thinking, on no account should anyone who wants to be in the financial sector be allowed to be in such a position.


One question I did have was how the influx in revenue in the financial sector was going to be accounted for. When we talk about poker revenue, it's understood that the revenue is the money that is lost by those playing. Anyone's winnings is going to be at the expense of those others who tried, and the money on top of that is what the operators make. If the financial system is in such a way that profits are going higher, that there's huge salaries and bonuses, that there's large fines being dished out that can be absorbed, and there's even a lobby group that has billions of dollars a year at its disposal - then where is this extra revenue coming from?

The documentary gives a number of causes of this: artificial inflation of the house market, excessive corporate borrowing, people taking on more debt, predatory lending, etc. With a system that promoted certain behaviours financially, the argument was that such practices were inevitable - each part of the system acting in its own self-interest, with the whole thing eventually falling apart. Possibly the most egregious moment of the film were the ratings firms defending their dodgy (and well rewarded) ratings as being mere "opinion", which seems about as much opinion as yelling fire in a crowded theatre after being paid by the usher to make a scene.

If nothing else, any industry, especially an otherwise well-established offering no new service, making more and more money should warrant investigation into how that money is being generated. How is it the financial services could become so lucrative for those involved without that money coming from somewhere else?


Getting back to the analogy of the poker machine reforms, the obvious disanalogy is that the poker machine reforms are there to try to help specific individuals who have a problem. Their negative effects are largely sociological and confined to the immediate family and friends of problem gamblers. When the financial system collapses under its own bad practices, nearly everyone is affected. If that's not reason enough to try to put some regulation in place to prevent there being such huge potential collapses in the system, then what would be?

Always One Too Many

When people say there are too many abortions in society, do they have a figure in mind of what's acceptable? 100% abortions would be unacceptable, obviously, as would a number that kept the birthrate too low for a sustainable population. But what then? Would any abortion that was done as a means of birth control be one too many? Would any abortion be too many?

The problem of course is that we can easily find examples of where we can validate a sense of outrage. That we could easily do better by eradication of such waste. Perhaps it's easy to give examples of teenagers who got pregnant instead of staying abstinent and then using abortion to shirk their responsibility.

Another example is taxation. It's easy to feel outraged over government waste, that one's tax level is always going to be too high because there's always government spending on useless things. I remember a few years ago a news report complaining about a painting that the New South Wales government spent a 6-figure sum to purchase which was white paint on white canvas. Not purchasing that would have saved each New South Wales taxpayer around five cents!


The kind of argument is somewhat deceptive, as it provides a small point of agreement with the implication being the implicit support of total eradication. It's easy to gesture to a reduction, but to what extent does it entail? For those who wish to see an end to abortion, getting pro-choice people to agree to wanting to reduce abortions is really an implicit mandate for condemning the practice. Likewise libertarians will see any and all taxation as stealing, using waste as the mandate for a reduction from what there is now.

Sometimes it is important to argue for reduction, and reduction can be a good thing. Perhaps it's important to reduce spending in a time when the budget won't allow for it, but then it's too high in regard to an external constraint. The Iraq War might have cost the American taxpayer hundreds of billions at a time when there's a high deficit, but is the outrage in that case really about the money or the act of war? For those opposing the war, they would do well to steer away from the costs because their outrage is not with the fiscal cost but with war itself.

But reduction for reduction's sake is a weasel argument, a means to gather support for a position that people would otherwise find unfavourable, through finding smaller favourable elements that both sides can agree on. If I agree that funding the high arts is a waste of taxpayer money (I don't, for the record) it doesn't mean that I think taxes could or should go lower. Likewise if I agree that using abortion as a method of birth control is something bad (I don't, for the record) it doesn't mean that I wish to see the end of abortion.

Morning Scepticism: Status Symbols

Apparently there's too much household debt right now, and this obviously is a problem. But we are in a society of rampant consumerism, where the ability to consume is as much about having status symbols as anything else. If you can't afford a status symbol then on the promise of paying more in the future there are plenty who are willing to throw money at you to have it now. In an environment such as this, how can we expect anything else?

Morning Scepticism: Flat Tax

A flat tax would only serve to exacerbate income inequality and has no redeemable features. It's not a fair system as it puts a disproportionate burden on those who don't have disposable income. It's been a nice trick to convince people on lower incomes that the problem is the free-loaders at the bottom rather than those hoarders at the top, the complaints of unfair taxation of the prosperous means putting the burden on those who aren't.

Morning Scepticism: Constitution

It perplexes me that Bill O'Reilly would look to a 222 year old document for authority on socio-economic measures. Even neglecting that its no longer 1788 and circumstances have drastically changed, there's over 200 years of intellectual exploration in social and economic theory as well as many different implementations by different countries around the world with varying success. It's like neglecting solar power because the founding fathers did just fine burning wood.