Reuters: Money: Ethical economy: More charity, less bureaucracy

Reuters: Money Reuters.com is your source for breaking news, business, financial and investing news, including personal finance and stocks. Reuters is the leading global provider of news, financial information and technology solutions to the world's media, financial institutions, businesses and individuals. // via fulltextrssfeed.com

Ethical economy: More charity, less bureaucracy Mar 21st 2012, 13:48 A woman makes a donation at a drive-through relief event at Dodger Stadium to raise money for the American Red Cross Japan earthquake and tsunami relief efforts in Los Angeles, California March 15, 2011. Credit: Reuters/Lucy Nicholson By Edward Hadas Wed Mar 21, 2012 10:28am EDT LONDON, March 21 - Charity is a cold, grey, loveless thing. If a rich man wants to help the poor, he should pay his taxes gladly, not dole out money at whim." Clement Attlee wrote that in 1920. As British prime minister after World War Two, Attlee turned thought into policy. The welfare state that he helped create has decimated private charities for the poor. It's much the same in all rich countries. Governments now take the prime responsibility for the care of the poor. Even in the United States, where the charitable (voluntary) sector is relatively large - twice as high a share of GDP as in the UK, according to the charity Philanthropy UK - the share of GDP taken by federal and state welfare programmes, as measured by the OECD, is 10 times higher. But Attlee's judgment has been proved wrong. If organized charity was cold, the carefully calibrated payments and entitlements of the welfare state are icy. The welfare state has many aspects but in terms of the alleviation of misery it has not worked as intended. The decline of hunger and voluntary homelessness - and the spread of electricity, telephones and the like - might suggest otherwise. But the increase in overall prosperity and the establishment of the principle of a "living wage", rather than the mechanisms of government entitlements, have wrought these changes. In any case, Attlee and his allies thought the welfare state could do much more than merely keep wolves from doors. They thought it could destroy what Oscar Lewis would later call the "culture of poverty". The anthropologist talked of "a strong feeling of marginality, of helplessness, of dependency, of not belonging". But while the decline of proletariat and peasantry has reduced the proportion of the population of rich countries who live in that culture of poverty, the welfare state has tended to increase both the marginality and the dependency of those who do. They live in their own world, dependent on the government programmes and rewarded for irresponsibility. I have heard the children in a welfare-dependent family talk about "getting paid", as if their mother's indolence were a sort of job. That family, like so many in the system of poverty-relief, had no father. The rise of such single-parent families cannot be attributed entirely to the availability of welfare, but such payments make antisocial behavior that much easier. Attlee accused charity of being loveless, but the recipient of government money experiences a profound alienation amid the welfare state's bureaucratic structures. Care professionals have forms to fill, quotas to meet and regulations to obey. However good their intentions, they cannot avoid treating their clients as administrative ciphers. The two sides are not tied by charity, but separated by a cold wall of impersonality. For society, the result is disastrous. Too many children of welfare families end up as welfare-dependent adults, or in prison. Too many people on benefits cannot emerge from semi-permanent unemployment, or from substance abuse. It's time to give voluntary help, the free spirit of charity, a new chance. If the state would withdraw, there would be fewer rules; more opportunities to develop personal relationships with the needy; and more space for organizations motivated by a higher calling, be it religious or philanthropic. It won't be easy to reduce the government's role in what has been an age of expansion. But the collapse of state economic control after the fall of Communism can serve as a helpful precedent. The trauma and corruption of that transition need not be repeated. What is required is a slow and carefully planned privatization of anti-poverty programmes. The first step would be to make the various government agencies more like state-funded not-for-profit companies. A new legal and administrative status would make a full separation from the government easier. A gradual withdrawal would follow. Donations would replace taxation over a decade or so. People would be generous; they would be paying less in taxes and could be persuaded that their gifts would help those in need. That is a much more attractive prospect than feeding a bureaucratic system. On the allocation side, the rules could be loosened in proportion with the advent of private funding. Competition should also play a role. As the state's flow of money dwindled, outsiders might well take over from the former state agencies. In the end, charitable arrangements might offer less money and less certainty than the State's blanket coverage. But that would not necessarily be a bad thing. The culture of poverty will be less appealing if it is less comfortable. And while a modestly funded culture of charity will not be able to afford the carefully calibrated assistance of Attlee's dreams, it can offer the poor more of what they really need: the burning fire of charity. And charity, after all, is another word for love. (The author is a Reuters Breakingviews columnist. The opinions expressed are his own) (Editing by Robert Cole and David Evans) Link this Share this Digg this Email Reprints

You are receiving this email because you subscribed to this feed at blogtrottr.com. If you no longer wish to receive these emails, you can unsubscribe from this feed, or manage all your subscriptions