Benefit tourism – another neo-liberal fallacy

One of the tools that right-wing elements use to control the public debate about government spending and to justify their attack on public deficits is migration. There are many aspects to this public manipulation that invokes raw fear, ignorance and prejudice among the population. One of the elements, which plays on job insecurity and the range of fiscal myths that characterise the neoliberal era, is the claim that so-called ‘benefit tourism’ is rife and if left unchecked will bankrupt national governments and lead to higher burdens on ‘taxpayers’. So we are often told that migrants from poorer nations move to access welfare benefits that are superior to those offered by their own nations and that these movements are parasitic in nature and do not advance the interests of the host country citizens. Last week (December 10, 2015), the Irish-based EU organisation, the European Foundation for the Improvement of Living and Working Conditions (Eurofound) released a report – Social dimension of intra-EU mobility: Impact on public services – which examines “the extent to which mobile citizens from central and eastern European Member States … take up benefits and services in nine host countries” by “mobile citizens from 10 central and eastern European Member States” (the so-called EU10 mobile citizens). The Report should be read by all those who wish to contribute to this debate or understand what the facts are. Essentially, the Report finds that mobile citizens from poorer nations have lower take-up rates of welfare support in host countries than natives. That really should be the end of the ‘benefit tourist’ assertions. But then most of these public debates are not based on evidence or logic.

In response to data released by the British Department for Work and Pensions, the British tabloid Daily Mail published an astounding headline (August 29, 2013) – Number of foreigners claiming UK benefits leaps 41% in 5 years: More than 400,000 now handed payouts that cost taxpayers billions each year – which culminated in the conclusion that migration from Eastern Europe, Asia and the Middle East to Britain was “costing taxpayers billions of pounds a year”.

The article then went on to articulate the so-called “concerns about benefit tourism”.

The conservative and the right-wing elements in most countries whip up this notion of ‘benefit tourism’ to stir up the emotions of the public and turn them against supporting new entrants to their nations.

The debate is particularly rife in Europe, given the scale of the current refugee disaster, which has been created by misguided policies adopted by the US and other Western governments in relation to so-called terrorist threats.

In April 2013, government ministers from Austria, Germany, the Netherlands, and Britain wrote a – letter – to the president of the European Counsel for Justice and Home Affairs about “freedom of movement in Europe”.

They noted that under current rules, which impose conditions under the Treaty on the Functioning of the European Union to freedom of movement, that:

Currently, a number of municipalities, towns and cities in various Member States are under a considerable strain by certain immigrants from other Member States. These immigrants avail themselves of the opportunities that freedom of movement provides, without, however, fulfilling the requirements for exercising this right.

This type of immigration burdens the host societies with considerable additional costs, in particular caused by the provision of schooling, health care and adequate accommodation. On top of this strain on vital local services, a significant number of new immigrants draw so- cial assistance in the host countries, frequently without a genuine entitlement, burdening the host countries’ social welfare systems.

The letter demanded that “all necessary measures need to be taken to deal with the consequences of this type of immigration and to fight its causes”.

On November 28, 2014, British Prime Minister stirred the pot some more in a speech on – Immigration and borders – when he criticised the previous Labour government for allowing migrants “from outside the European Union with no skills at all to come to the United Kingdom” and for allowing asylum seekers to immediately claim welfare benefits.

He then outlined a series of new policies that the government was proposing at the time to introduce, including denying access to so-called EU jobseekers to income support while unemployed and forcing the same cohort to leave the UK if after six months they had not found work.

He said:

EU jobseekers who don’t pay in will no longer get anything out, and those who do come will no longer be able to stay if they can’t find work.

A number of other changes were proposed to stop so-called ‘benefit tourists’. He said ” It cannot be right that migrants can turn up and claim full rights to this club straight away”, the club being the British welfare system, allegedly supported by “the contributions of hardworking British taxpayers”.

The speech was part of his campaign to change the way in which Britain interacted within the European Union and the results of that are yet to play out fully.

The British Labour Party, is in fact, no better.

The irony of Cameron speech was that it was hugging on the ‘benefit tourism’ heartstrings but most of the policy changes signalled worried relation to genuine jobseekers from other countries where unemployment was rife. In other words, these people were seeking work not benefits.

The Eurofound study provided a summary of the ‘welfare tourism’ debate in the various countries within Europe that they studied for the Report (as Table A1 in the Annex). I reproduce it here.

Eurofound_2015_Annex_Table_A1

A common theme is the “burden on the welfare system” and “displacement of native workers”.

In the Eurofound study we have fairly comprehensive evidence to refute the benefit tourism case against migration.

The key conclusions are:

1. “EU10 mobile citizens’ take-up of welfare benefits and public services in host countries is lower overall than that of the native population, and significantly so in the case of social housing and pensions.”

2. “there are certain benefits, mainly employment-related benefits (unemployment and in-work benefit), that EU10 citizens claim more than the native population”, which is consistent with the observation that people want to work and are not moving nations just to arbitrage more generous welfare payments.

3. “EU10 citizens tend to use health services less than native populations”.

4. “Take-up of social housing by EU10 mobile citizens is lower than that of native populations”.

5. In “some countries, such as the UK” there are “high concentrations of mobile citizens in certain geographical areas” and the “increasing pressure this puts on schools could cause tension, especially in rural areas that have no previous experience of immigration”.

Overwhelmingly, the evidence does not support the so-called ‘benefit tourism’ notion.

The study also suggests that accessing benefits in host countries is difficult for “eligible EU10 citizens” because of “complicated social welfare systems, and partly because they often lack information and language skills”.

New entrants also do not receive adequate assistance “with recognition of diplomas’, which means that many migrants work in jobs for which they are grossly over-qualified for.

The study concludes that there “is a need for greater employment support for EU mobile citizens because of the disadvantages they face in the labour market and integrating into society”.

Chapter 2 of this study considers the “Take-up of benefits and social services” and provides detailed information of the access rates by mobile citizens of host country welfare systems.

It is a chapter that anybody who wants to comment publicly on this issue should read. Unfortunately, the mainstream media journalists who gain sales by beating up raw prejudice among their readership will probably not avail themselves of the knowledge presented.

The take-up of unemployment benefits in host countries is critically dependent on the state of the labour markets in those countries.

The Report says that it is “not surprising … that since 2008 the number of the EU10 nationals receiving unemployment benefit has increased to a larger extent that that of either natives or EU15 mobile citizens”.

But for Britain “where the employment rate of EU10 citizens remain higher than that of UK citizens even after the crisis, the share of EU10 citizens receiving unemployment benefits is still the lowest compared with the other nationality groups”.

Further, in Britain, “the take-up of income support by EU10 citizens is actually the lowest compared not only to natives, but to other EU mobile citizens … and third-country nationals”.

Also, the take-up of sickness and disability benefits is lower for EU10 citizens than natives in most of the nations studied.

The report considers other welfare payments including family benefits, housing benefit and the use of health services, education, social housing and homelessness services.

The “main conclusion of the study”:

… is that, although there are certain social benefits where the take-up by EU10 citizens is higher than that of natives, mainly employment-related benefit, overall their take-up of benefits and social services is lower, and significantly so in most countries for benefits such as disability and sickness benefits, social housing and pensions.

A few reflections are in order.

First, the entire debate about ‘benefit tourism’ is largely conducted on the false premise that governments in host countries such as Britain face financial constraints on their spending, which means that a pound allocated to one purpose is always at the expense of a pound allocated to another.

Clearly, the Eurozone Member States are financially constrained because they gave up their currency sovereignty and now use a foreign currency that is issued by the ECB, which they have no direct legislative control over (unlike sovereign nations such as Britain).

The constraint facing the British government in determining its spending priorities is fundamentally related to the availability of real resources that are for sale in British pounds.

Ultimately, the limiting factor for any nation is its real resource availability.

The question of population policy then has to be debated within the context of those factors rather than whether the national government will run out of money if swamped by immigrants who want benefits.

I would qualify that statement by noting that real resource availability also extends to environmental sustainability considerations. So for example, in Australia it is often claimed that we have a low population in relation to our landmass, which is true when judged by, say, European standards.

But what is often not equally stated is that most of the land in Australia is incapable of supporting population growth because of our lack of water.

Second, a national government, which issues its own currency and floats it on international markets, can always use that currency capacity to ensure that all available real resources are fully and productively employed.

So reflecting on the Report’s findings that migrants do take up employment-related benefits at greater rates than the natives as a result of their labour market disadvantage, if the government was worried about that then it could always provide work for the unemployed citizens.

This raises questions about how a Job Guarantee might be compatible or not with a relatively open borders policy. I won’t address that issue here for lack of time today.

I would suggest, however, that it is highly unlikely that a nation offering a JG will be swamped with migrants at higher rates than already exist as a result of their relatively stronger labour markets.

Conclusion

The Eurofound report is a welcome intrusion into the debate about migration, which is typically based upon emotion rather than evidence.

The evidence-based nature of the report is powerful and should be used by progressive journalists to disabuse people of their blind prejudice in this regard.

That is enough for today!

(c) Copyright 2015 William Mitchell. All Rights Reserved.

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    23 Responses to Benefit tourism – another neo-liberal fallacy

    1. Podargus says:

      As an Australian I am not really interested in European immigration squabbles although my casual opinion is that Europeans and Americans,in general, are quite mad in that respect.

      Australia has been running a high immigration policy for many years – well in excess of 200,000 net per year. This is not sustainable for a number of reasons,not just the lack of water. Australia has,overall,ancient poor soils which are not suitable for agriculture. We have an extremely variable rainfall. Averages are no guide.Dryland farming is a gamble in most areas.The monsoonal North is wet for 3 months of the year and in drought for the remaining 9. Most rivers are ephemeral – massive flows in the few good years,dusty dry for most of the time.

      We have huge problems with land degradation due to past and present farming practices.Salinity and soil erosion are prevalent. Vast areas have been overcleared of native vegetation which is adapted to Australian conditions. There are widespread problems with feral animals such as pigs,rabbits,goats,buffalo,horses,donkeys,dogs,cats,foxes and camels. Because of remote and rugged terrain control measures are expensive and difficult. Heavy,hardfooted cattle and sheep damage our fragile soils and vegetation.Native forests are being clearfelled to export wood chips.

      We have a large extent of coastline,including urban and industrial areas,which is at imminent risk of inundation due to rising sea levels.
      This picture doesn’t bode well for higher population levels especially when global warming will likely throw a big spanner in the works.
      Our two major cities,Sydney and Melbourne,are now well in excess of rational population levels. The traffic and public transport congestion is extreme by Australian standards.. High rise tenements are intruding on suburban areas adversely affecting the quality of life of native Australians.. There is a pronounced ghettoization of immigrant populations,particularly Moslems and Asians. This contributes to an already poor social milieu as well as the usual law and order problems.
      Brisbane and Perth are not far behind in the mad rush. Only Hobart and Adelaide are still what can be called livable cities and the latter is in the grip of the developer fever.

      Yet our fearless (as in stupid) leadership continues on this dead end path. It is about ideology and money. Not necessarily in that order. There is nothing intrinsically beneficial in human population levels above a viable minimum.
      Go figure.

    2. Neil Wilson says:

      “I would suggest, however, that it is highly unlikely that a nation offering a JG will be swamped with migrants at higher rates than already exist as a result of their relatively stronger labour markets.”

      I’m going to disagree with you for a change Bill. I’m afraid this report suffers the same problem that every other report I’ve read on this topic of EU immigration – it fails to set the null hypothesis correctly.

      The null hypothesis is what would be the case if EU citizens were subject to the host country’s visa restrictions. In other words the only individuals that would differ are those that would fail the country’s visa requirement. Refugees and individuals with higher level skills applying to higher level jobs would always get in anyway – and therefore they should be excluded from analysis.

      The word ‘visa’ is never mentioned in the report, and therefore it suffers from the same problem as all the other. It hides the group of people you want to know about in the aggregate – which is a common trick I find when people are pushing a line (in this case the wonders of corporate obedience in the EU and reinforcing the idea that workers have to move around an entire continent to the businesses, rather than creating work in the communities where people already live).

      What would have been interesting is to see the type of people coming into a country when the transitional arrangements were in place and after they were lifted, to see if there is a difference in their composition. I note the usual ‘UK is a special case’ notes in the report, but no link to the fact that the UK was the first country (afaik) to lift restrictions completely. (I feel the Working Tax Credit benefit is likely to be the most indicative for a Job Guarantee).

      The Job Guarantee, if properly implemented, provides a job tailored to the individual. Which means that the restrictions on the local job market are lifted. The current shortage of work, skill requirements or Mike Ashley inspired Gulag conditions stop people getting jobs and flow restrict the job market. If you lift those flow restrictions then you get a massive shift of people – particularly once word gets around. This is what happened when the EU10 visa restrictions were lifted in 2004, and you get an overload on the main public services (primarily because the people in charge had a rosy tinted view of migration and the flow estimates were orders of magnitude too low. Everybody was ‘surprised’, although ‘deluded’ might be a more accurate description).

      And of course it has happened in history – the Irish immigration to the UK, and the growth of major industrialised cities. I would have thought the inrush of people to a location (and the struggle to stop degradation in that area) when there is a massive increase in jobs would be well understood, but it doesn’t appear to be. Or at least if it is, it is hidden away in dusty academic archives somewhere.

      Surely somebody has studied that history – preferably more recent ones that are influenced by the greater communication capability of a modern world

      A Job Guarantee would, by its very nature, encourage more people to apply for it and could be quickly overloaded by a flood of people – most of whom would be medium to low skill. With existing immigrant communities in place in many countries now, the vanguard effect – which slows down migration – wouldn’t happen, and the communications back to their homeland are much better.

      As an aside, another advantage the Job Guarantee has over benefits and income payments is that it would catch those trying to scam the system. If you have to turn up everyday for work somewhere before you get paid then it is very difficult to claim in one country while living in another. A recent UK channel 5 documentary had a couple of cases (one Roma, one Polish) where they were pulling that trick. As usual for these sort of entertainment anecdotes they are very much the exception rather than the rule – but it does happen. The Job Guarantee would stop that dead.

      The whole nasty debate about benefits and jobs is about imposing flow restrictions by the backdoor. And the more of these conditions you put in place, the more people drop through the net. It’s always been the case in the UK that if you are resident, you have access to health, social care, etc. Nobody checks eligibility. To me that is the correct approach. If you have been invited into a country on visa, or by treaty then you should be treated the same as everybody else. Anything else is a genuinely racist act imv.

      And as you rightly point out the environmental carry capacity of a nation is never even mentioned in these debates.

      Fundamentally if you need flow restrictions then be honest about it and do it at the front door. I really don’t think it can be left to ‘market forces’ if you actually want to create a real differential for poorer people between your nation and the rest of the world.

    3. jake says:

      ¨although there are certain social benefits where the take-up by EU10 citizens is higher than that of natives, mainly employment-related benefit,¨

      Migration of the EU 10 has resulted in masive wage supression in the low and mid level wage job market.
      Working tax credit Benefits are not only subsidising indigenous labour for businesses but foreign (Polish,baltic,etc) labour.

      working in tax credits were brought in in 2003,just before the 2004 EU ascencion of the EU10.
      There has been a massive influx and wages have stayed suppressed and rents have gone up(as the real estate market does not typically respond quickly to demand).

      There is unemployment and underemployment and stagnant low wages.I think camaron’s move to do away with working tax credits for EU citizens is a good one.As it subsidises foreign labour and keeps wages low.The Economy already has done a poor job of absorbing the underemployed labour and labour in general; at living wages.

      Also these benefits do not have an equivalent in E.europe,One labour minister wants to return to contributory benefits only and get rid of income related benefits.This is not the correct approach.The UK welfare state compares better than other EU countries (yes even the netherlands and scandinavia).The rest of the EU typically has a welfare system which relies on a contributory system,the UK has non-contributury welfare system.Britain is alone again in healthcare, even French and German system’s don’t even have “free at the point of use” systems.

      It is no surprise that we have seen wages stagnate and rents go up(yes there are other contributory issues with the rent) since the introduction of surplus european labour in 2004 and working tax credits.

      The real neo-liberal fallacy is that rushing to create a continent wide free movement of people (labour) would actually improve people’s living standards.(apart from buy to let landlords,the’ve done alright)

      IF you talk to middle class professionals,they will inform you that migrants come here to do jobs that natives/locals simply don’t want to do.As if all unemployment was involuntary.This is what an open-door migration policy implies;and this is the neo-liberal policy that needs addressing.

      I still remember telling a relative (a citybanking solictor) about how some people ave seen their wages collapse.In east anglia a agricultural worker could command £10 per hour,now it sits at minimum wage. In Portsmouth a young man saw his wages shrink from £80 a day working on a building site go down to £40.SHe told me that”they should simply work more” as if a full days work shouldn’t provide the means to live at an okayish standard of life.

    4. Nigel Hargreaves says:

      An excellent and timely post.

      Sadly, Mr Cameron won’t read it and will plod on with his his ridiculous and pointless “negotiations”.

      I have written elsewhere that migrants do not come to Britain for the benefits – they come here because there are jobs here and prescious few in their home countries. Those from places like Syria are coming because they fear for their lives. Not being entitled to in-work benefits will make absolutely no difference to their numbers. Reducing immigration is the purpose of Cameron’s moves because his focus groups have found that it will buy votes. Or at least appearing to be doing so.

      The answer to the migration problem is for the EU to sort itself out and introduce policies that utilise their huge resources instead of allowing them to stand idle. Scrapping Article 123 of the Lisbon Treaty would be a good start.

    5. Stuart Medina Miltimore says:

      Ironically in Spain another type of benefit tourism has sometimes been discussed: foreign tourists and retirees (mostly British and German) taking advantage of the health service to get the medical attention at no charge. The answer I give people who come up with these ridiculous claims is alwasy: “what a wonderful business opportunity for the Spanish state. They can help pay for our health service because the Spanish state can then send an invoice to the government of the retiree. We should get more of these British and German retirees to come here.

    6. larry says:

      Neil, when you say that “Refugees and individuals with higher level skills applying to higher level jobs would always get in anyway”, you may be right, but it is unclear whether they would obtain a job commensurate with the skills they possess. I know a taxi driver who was a physicist but when he came he could not get a job in physics, so decided to drive a cab. Many in the City are there, not simply because of the money, but because they couldn’t obtain positions in physics or mathematics but discovered that the financial sector wanted them and were prepared to pay well. Initially at least, they may have seen the income stream in the financial sector as reasonable compensation for not being able to do what they really wanted to do in the first place. My taxi driver is only one example. His experience could be multiplied.

      Another factor that hardly gets a mention when this issue is discussed is the comparison of so-called benefits that some see immigrants receiving and the cuts they see being implemented around them to those who are “like themselves”, irrespective of how realistic this viewpoint may be. This happened in Germany about 10 years and more after reunification. Western Germans, rightly or wrongly, were complaining about the “benefits” the East Germans were receiving, feeling that 10 years or more is sufficient time to adjust to the West German way of living and, therefore, that they shouldn’t be receiving any more than a typical West German would. And here a distinction is being made between two different kinds of Germans, as some of them saw it. They even “saw” crime rates rise as a consequence of East German settlers. When I queried the source or the information, I was told I didn’t really understand what was going on. While this may have been true, a number of West Germans I knew were unreceptive to the idea that there may have been some sort of social discrimination at work here.

    7. Neil Wilson says:

      “but it is unclear whether they would obtain a job commensurate with the skills they possess.”

      You have to have a job to get a UK visa, on the Tier 2 scheme, and if you change jobs you have to reapply.

      A visa holder isn’t legally entitled to drive taxis.

      In quite a few of the analyses I’ve seen on the EU10, they mark the individuals as ‘highly skilled’, because they have higher level qualifications. But the jobs they are actually doing are elementary. It’s another one of those irritating obfuscations that you find in the reports, and you’re always having to double check the interpretation.

    8. Some Guy says:

      Glad to see some common sense from Bill on such issues: I would suggest, however, that it is highly unlikely that a nation offering a JG will be swamped with migrants at higher rates than already exist as a result of their relatively stronger labour markets.

      Yes, and the effects of current stronger labour markets could be easily used to provide sensible ballpark estimates of immigration effects of a JG, which would be highly unlikely to show that the offering nation would be “swamped”.

      Neil: I would have thought the inrush of people to a location (and the struggle to stop degradation in that area) when there is a massive increase in jobs would be well understood, but it doesn’t appear to be.

      I would say that any inrush would be far, far less than you have suggested elsewhere – UK population increasing by a third in several weeks. Meaning ~ 1 million immigrants per day! Today, entries are ~<100,000 per day, net immigration a few hundred thousand / year, about 1000 times less than such a suggestion. Of course this would be a problem – but the chance that it would need to be confronted is nil.

      Surely somebody has studied that history – preferably more recent ones that are influenced by the greater communication capability of a modern world. The relevant communication capabilities have not changed for decades, really for more than a century. People don’t change their residence and jobs at a drop of a hat! So a speedup from a few days (telegraph, telephone + newspapers) to internet & cellphones is negligible – especially when we are debating increases by a factor of 1000. I’ve detailed a few of the obvious self-limiting effects of an open JG here, but realistic numbers would help.

      But what I am really concerned with is that such issues make people stop thinking in the correct / MMT terms.
      The JG is not “a benefit”. It is a job. The benefit goes the other way: the JG worker is giving something to the community, which thereby becomes more able to employ the worker. In any realistic situation, the employing society will be better off; a JG and the JG workers will support themselves and more. The idea that it is somehow a gift to the unemployed is just forgetting the basics. The unemployed are unemployed because the state and society have made a disgusting decision to make them sacrificial victims to the (stupid, atavistic, boring) idea that there should be a class of masters and a class of lesser people. No other reason, not ever.

    9. Matthew B says:

      Some Guy, I think your last paragraph is spot on and should be attached to any post about a JG.

      To the topic at hand; It’s really the old xenophobia dressed up as economic nonsense.

      As for immigration to Australia, there’s plenty of space until a) the population consumes 100% of the produce grown here and cannot afford imports, and b) the coast is completely developed.

      Getting water is easy – the government can build all the desalination plants needed. The government can also induce people away from the cities by providing the right economic benefits and developing country towns with the infrastructure to support the growing population. Will it happen? Maybe eventually.

    10. larry says:

      Matthew B, It is not necessary to desalinate sea water if one is near an undersea volcanic vent. They produce immense quantities of fresh water that can be sent to the surface and filtered. The cost of installing the equipment is large, but the benefits are enormous. Of course, the further away one is from such a vent, the greater the cost in getting the fresh water where it needs to be. Desalination requires a great deal of energy in everyday use whereas fresh water “extraction” from undersea volcanic vents does not. A by-product of this process is electricity.

      What appears to put off governments who do not understand their own fiat economic systems is the initial cost. There are also issues of territoriality as some of these vents are within countries’ territorial boundaries and not in international waters. Both provide their own inherent difficulties though not necessarily insuperable ones.

    11. Neil Wilson says:

      “you have suggested elsewhere – UK population increasing by a third in several weeks.”

      I have suggested no such thing. Keep your straw men to yourself.

    12. David M says:

      Podargus and Matthew B . Australia has only 5% arable land which makes it not a big as you might think/like! Bob Birrell wrote a book about this with several colleagues from Monash U back in the 80’s called “How Many More Australians?” A good read given the issues about immigration and resource scarcity. As for Melbourne being described ‘the worlds most liveable city’ I don’t know about you but I think that is a full load of Bushwaa. Think about it as we go Carolling along at -5kmh. I try to avoid driving but it took me one hour to drive 15 kms last night. So lets keep stuffin em in and chokin em off!

    13. Neil Wilson says:

      “The relevant communication capabilities have not changed for decades”

      Yes they have. It took weeks on a boat to get places, and now it takes hours by aircraft. It took days and weeks by letter to communicate to poorer areas of the countries. Now you can see where you are going and get updates from people that are there instantly.

      Commute distances have expanded enormously over the past thirty years. Younger people are used to travelling around the place for jobs. There’s even a name for it – “the gig economy”.

      To suggest all this has no effect is completely naive. The estimates of migration into the UK in 2004 were out by one or two orders of magnitude (2004-2010 maximum 13,000 per year predicted, about 75,000. Actual number was over 900,000 ). That’s a serious estimation error even by economics standards. It is pretty clear that word gets around quickly, and you quickly get a flood. You go from having loads of school places and easily able to get to a doctors to oversubscription in the space of a couple of years. The public sector planning system can’t cope – primarily because it hasn’t got accurate figures to plan properly.

      Residents understandably get irritated when this sort of mess occurs – particularly as it is due to rose tinted spectacles.

      “The benefit goes the other way: the JG worker is giving something to the community,”

      That’s a very charitable way of looking at it when you are talking about unskilled workers at the low end – which is of course the only real difference between the visa system and the EU open borders. The fact that there are millions of native unskilled workers without work that want it shows that it is extremely difficult if not impossible to make any sort of profit with them. If there was a way then the private sector would find it.

      JG jobs at the low end will be a contribution – as they always are realistically. They are very unlikely to create sufficient required output to justify expansion of the housing and social care systems to cover the additional people. The contribution is a ‘nice to have’ – there to show others that the individual is working for a living. Which means that you will end up with a social transfer from the rest of society to cover it.

      And of course you have a permanent transfer of environmental carrying capacity within the country receiving the immigrants.

      (Natives already are in houses, in the social care system and therefore there is no ‘extra’ capacity required to cope with them under a JG system. Their ‘base cost’ is lower or already sunk).

      There is a reason that countries set limits for skilled staff on immigration. So that the contribution of the immigrant definitely covers the costs on the other side *and* generates transfers to the existing residents. There has to be some reward for residents to justify the increased crowding of their country.

      The difference with the JG is that you are not matching people with jobs. You are matching jobs with people. So you do your best to get anybody who turns up something they can do. It is a system designed to be effective rather than super efficient. (The private sector hiring people away is the mechanism for getting efficiency).

      Plus there is the real-politick issue. You can believe as hard as you like that there won’t be a flood of people, that the system will be able to cope and that the system is self-limiting regardless of how steep a gradient you create with the rest of the world.

      But others will quote the 23 million people that have the right to take up a UK JG job. They will quote the order of magnitude estimate failures of left leaning economists. They will quote the flow rates of people onto work schemes where they had to match a pre-existing job, rather than have one created for their current skill levels. And they will point out that the output of JG workers is ‘inefficient’. With a native resident you can point out that you can’t get rid of them and that any output is better than nothing. With an immigrant the “can’t get rid of them” argument doesn’t apply.

      I can’t see the process being self-limiting other than by making native residents very poor indeed, or by doing what Cameron is proposing doing and treating immigrants with contempt.

      The rational choice is to have flow control mechanisms in place so that you can reassure people that there won’t be a flood and the school places won’t disappear overnight again. It is the honest approach.

      Anything else is a triumph of ideology over reason and will actually stop a JG getting implemented.

    14. A Luta Continua says:

      “23 million people [from the EU] that have the right to take up a UK JG job”

      I’m probably being a bit thick here, but if JG jobs are considered to be public sector jobs (and there seems to be at least some suggestion that they are) then is the last paragraph of Article 45 of the Lisbon Treaty (which deals with free movement of labour and states ‘the provisions of this article shall not apply to employment in the public service,) at all relevant.

      Happy for someone to tell me that this is just a naive interpretation.

    15. Ikonoclast says:

      I am in favour of a Job Guarantee for Australia. I do not see that it would cost any more than current unemployment benefits plus lost production due to capacity under-utilisation. In fact, there would very likely be a net economic benefit. In addition, there would be a large net human benefit (qualitative improvement in lives) which is essentially invaluable.

      A population policy is required in tandem. Given current knowledge we could set a population ceiling for a sustainable population. Current ecological footprint analysis can provide this estimate. The science will progress (just as real events will progress) so the ceiling estimate can be re-visited every five years and revised upwards or downwards as required. Net immigration should be tailored to give a smooth decelerating curve to the ceiling estimate over about 25 years. Natural birth rates will also impact on settings of course.

      Given the above, we could allow refugee places and immigrant places. If genuine refugees are higher than expected we reduce voluntary immigration. This whole system would necessarily imply immigration limits, if they proved necessary which seems likely. Such a philosophy is, in the final analysis, exclusionist but justifiably so. There is no net benefit to humanity, in the long run, in taking any continent over carrying capacity.

      Exclusionism is however a moral dilemma. It is nicely convenient to be in the correctly-loaded lifeboat and to have the oars to not only row but to push away the drowning. What would we do if the moral dilemma came to that? I mean if Australia was “fully loaded” by footprint formula calculations and then 100,000 Pacific Islanders desperately needed entry due to sea-level rise? In the future, we are likely to face tremendous moral dilemmas in a world of resource shortages and collapsing natural systems.

    16. Some Guy says:

      Me:“you have suggested elsewhere – UK population increasing by a third in several weeks.”
      NW:I have suggested no such thing. Keep your straw men to yourself.

      I see no other way to construe the below:
      “So let’s do the thought experiment. Implement a Job Guarantee now at the living wage in the UK. With the open borders to the EU and the unemployment level across the EU at about 23 million you will get a mass migration to the UK to get a job and a living wage.

      How are you going to house those people next week? How are you going to feed those people next week? What will be the environmental impact on the UK’s sewerage and water networks of an instant population increase of up to a third in a matter of a few weeks?”
      Job Guarantee – Jobs For the People comment at 19 November 2015 at 06:59

      Will reply to the rest later, when able; glad we can agree that this is too much.

    17. Piodasrgus says:

      Ikonoklast – Correctly loaded lifeboats with or without oars are a rare item in today’s world. Survival is what it is all about.
      The South West Pacific has a problem with localized overpopulation.These are small islands and it should be rather bleeding obvious when the breeding rate is exceeding the carrying capacity. Their ancestors knew this and acted accordingly but then they didn’t have the option of exporting surplus bodies to New Zealand or Australia.

      Also, not all of these islands are low set atolls. Many are high set,usually of volcanic origin.The SW Pacific islanders have it within their own power to solve their own problems re overpopulation and climate change. Australia should offer advice and assistance not resettlement.

    18. Neil Wilson says:

      “I see no other way to construe the below:”

      That’s probably why you’re struggling with the issue of flow management.

      You have inferred it from your belief structure, ignored the qualifications and then drawn up a straw man to attack at the extreme boundaries.

      It’s a very common technique when you read something that clashes with your belief structure.

      Pointing out the outer boundary in an ongoing discussion – with guards in place – isn’t the same as predicting that is what will happen.

      I have shown above with numbers that the flow estimates made by Labour governments were way out of kilter with the reality of what happened on the ground. That cannot happen again if you want a programme to survive long term.

      The supply pool is up to 23 million people in a continent that is still getting worse for jobs. There is a constant statistical increase in net migration into the UK from the EU, that shifts when restrictions are lifted (Romania/Bulgarian migration trebled when transitional restrictions were removed). The current EU net-inflow is 183,000 per annum – a town the size of Swindon every year.

      There is an ever increasing migrant population here, that is developing its own community. The UK’s biggest supply of skilled migrant workers is from India – and they have to get visas and fly for hours to get here. It’s very easy for Indians to live here because we have vibrant Indian communities. Increasingly we’re getting vibrant Polish and Romanian communities springing up.

      If you then create a programme with a higher income gradient (at the living wage) targeted largely at the working poor and secondary labour market that creates jobs *taking people as they are* (i.e. if you’re a Polish speaker, you’ll get a job suitable for a Polish speaker – probably serving the Polish communities) then you have created a whole new and far more attractive pull to the UK than working in a Mike Ashley inspired Gulag on zero-hour contracts. Word does get around very quickly and Easyjet, et al flights are very much cheaper than they have been in the past.

      Given that recent expansion has used up pretty much all the buffer there was in the system (the ‘choice of school’ policy is even more of a joke now than it was prior to 2004. You need excess capacity before there is any choice), then the chances of the system being swamped are much greater now than before. Years of underinvestment have made the structure very brittle indeed.

      So there will be a flow shift due to the increased attractiveness of the jobs and life on offer. How that works is likely better explained by shifts to cities within countries that have recently modernised – such as the East Asian countries. What causes people to stay where they are even if they are poor and have no job.

      And then there are host countries that have been operating ‘austerity’ for years and running down their social and public capital. The resilience that was there has been eaten away and it is not being replaced appropriately.

      I would put the risk at ‘somewhat likely’ rather than ‘highly unlikely’, and look to put in place contingent flow control measures. Ones that aren’t racist in origin.

    19. Neil Wilson says:

      “then is the last paragraph of Article 45 of the Lisbon Treaty (which deals with free movement of labour and states ‘the provisions of this article shall not apply to employment in the public service,) at all relevant.”

      It isn’t. The European Court of Justice (ECJ) has taken the approach over the years of interpreting restrictions narrowly and provisions generously based upon the treaty’s primary goal of free movement (essentially Article 3(ii)).

      The ‘public service’ provision has been clarified by the courts as those involving ‘the exercise of power conferred by public law’ where there was a responsibility for safeguarding the general interests of the State.

      Essentially you need to be James Bond before your job is protected under that provision.

    20. Bob says:

      “an instant population increase of up to a third in a matter of a few weeks?””

      Up to a third. It is unlikely to be that much. The point Neil is making is that is unpredictable and so you need to manage constant flows via a visa system.

    21. Bob says:

      “I would put the risk at ‘somewhat likely’ rather than ‘highly unlikely’, and look to put in place contingent flow control measures. Ones that aren’t racist in origin.”

      The problem with a skills based system is that it will still steal skilled workers from abroad. Although you could make the visas very expensive for business, I am still not sure that is enough.

      Just put in a system where the flow can be controlled. That doesn’t mean you can’t have a reasonably large flow, but if it is from the whole world there is greater mix and vanguard. The people opposing this saying ‘it will likely be OK’ are crazy. We can’t know as our predictions were way out in 2004. Why take additional risks when there is no need to? It makes no sense.

      The whole open borders thing is another thing pushed by the neoliberal salesmen designed to stop a government from helping its citzens.

    22. A Luta Continua says:

      “The ‘public service’ provision has been clarified by the courts as those involving ‘the exercise of power conferred by public law’”

      Thanks, Neil. I was being a bit too hopeful.

    23. Bob says:

      Tighter (unfair) visa restrictions on the RoW now means that net flows from the EU are about 50% of the total immigration per year, with a good chunk of the rest Chinese students:

      http://www.civitas.org.uk/pdf/largescaleimmigration.pdf

      The fiscal stuff is all wrong but:

      • Immigration from outside the EEAis estimated by the
      official Migration Advisory Committee to have had a
      negative impact on the level of native employment in
      the years immediately following the financial crisis of
      2007-8. The same is probably true of immigration
      from within the EEA, although the statistical evidence
      on this point is less solid.
      • Unskilled workers have suffered some reduction in
      their wages due to competition from immigrants.
      • Government policy towards immigration from
      outside the EU is becoming more selective, making it
      difficult for unskilled workers to enter, but
      encouraging the entry of skilled and talented
      individuals.
      • If this policy is applied systematically to poor
      countries it may denude them of the professional
      elites upon which they depend.
      • Controls over migration from poor countries should
      be designed in such a way as to promote their welfare
      and economic development. Migration policy
      towards these countries should be seen as a
      complement to the official aid policy and not as a
      means of enriching ourselves at their expense.

      How is that fair?

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