On Gordon Brown’s bookshelf stands a new title likely to stand out from the others: In Our Hands: a Plan to Replace the Welfare State. It is a detailed proposal to abolish all benefit payments, from pensions to child support, and instead make a cash payment to every adult in the country. Its author is Charles Murray, the controversial American academic who firmly believes that the Chancellor’s welfare policies are destroying the social fabric of Britain with calamitous results.
Infuriatingly for his army of critics, Murray has become too influential to be ignored. His first book, arguing that benefits were breeding rather than alleviating poverty, set the intellectual framework for America’s acclaimed welfare reform. He has met the Chancellor and was impressed by his intellect. Sitting in a barren office at the American Enterprise Institute in Washington, feet on the table and gazing out of the window as he talks, Murray wonders why someone as clever as Brown cannot see the damage wreaked on the poor by his own policies.
‘Here’s what I don’t understand. Gordon Brown is very well-read, including books he doesn’t agree with. He will have noticed things are getting worse. Things have not just failed to improve as welfare has increased; civil society in lower-income Britain is going off a cliff. So why doesn’t he ask whether there could possibly be a relationship between the welfare efforts he is making, and the deterioration observed?’
This is the point of Murray’s book — which is not widely available in Britain but is being passed around Westminster like a banned copy of Spycatcher. Welfare, Murray contends, is tearing apart the bonds that once tied low-paid neighbourhoods together. As people looked to the state for support, rather than to each other, their behaviour changed. Young men chose welfare dependency instead of work, and unmarried women had babies. Murray regards these as the twin engines of what, in a seminal 1989 newspaper article, he called the British underclass.
His analysis and language were hotly disputed then, as now, but he points to Britain’s crime rate as vindication. ‘When I first wrote that article, I said there was no reason crime would stop rising, although I thought to myself it would be quite something if it did,’ he says. England’s recorded violent crime has rocketed from 657 incidents a day in 1989 to 3,240 a day last year. ‘And yet Britain was the most civil society in the world not that long ago. Your crime rate in the mid-century was minuscule. You could walk anywhere at night, leave your bicycle unlocked. The deterioration has been incredibly fast.’
He argues that the welfare state has inflicted more damage on British society than on America’s because the incentives to dysfunctional behaviour are greater. A study by Civitas shows that the average family is £7,000 a year better off if the parents split up, and today one in four children is living with a lone parent. The right combination of benefits can pay £100 a week more than the minimum wage, and now one in seven adults — 5.3 million people — are claiming out-of-work benefits. Murray sees this as a rational, if deplorable, response to perverse incentives. Drug abuse and violent crime, his key indicators of an underclass, have doubled and trebled respectively since Labour came to power.
The plan outlined in his book would scrap all benefits and offer a flat sum to everyone — banker, single mother, pensioner, college dropout — of about $10,000. As the British system is more generous than America’s, his model would work out closer to £8,000 a head here. The richest would have their grant halved, but there would be no extra money for anyone. Crucially, there would be no more subsidy for what Murray believes is socially destructive behaviour. Top of this list he places lone parenthood.
‘The best thing about the plan is that it makes the single mother pay a price that she didn’t pay before. Would the baby starve in the streets? Of course not. The mother can tap into the additional money from the father, her parents are getting $10,000 which they were not before, and so are his.’ So the money would be there, but it would be up to those morally responsible to pay it up. It is not an attractive prospect, but this is Murray’s most controversial point: to make life explicitly tougher for single mothers.
‘Cruelty,’ he says, ‘consists of a glib assumption that government support for children can compensate for the absence of the father. That is an assumption which is now refuted by a mountain of data. In the United States, unlike Britain, there has been a wealth of studies on children in different marital situations. You can control for income, race, all the usual suspects. Again and again, the same findings come out: children do best raised by both biological parents, whether you measure delinquency, truancy, psychological development, anything.
‘A divorced mother is next best. Doesn’t really matter if she remarries or not, stepfathers don’t do much good. And way down the ladder, right at the bottom, are the outcomes of children born to single women. This has been proven again and again, yet when I go over to England and talk, scholars over there are not even aware that this literature exists in the United States. It’s kind of a head-in-the-sand thing, yet what we are talking about is an empirical fact, with which Britain refuses to come to grips.’
When Murray first made this argument with his 1984 book Losing Ground, it was energetically attacked. Single mothers need help, it was said, not condemnation. ‘At the time it was argued that a single mother can raise a child just as well as a married couple with the right level of support. But scholars on the Left did research, and found otherwise.’ Left-wing Americans serious about poverty, he said, joined the agenda and in 1996 Bill Clinton signed a welfare reform Bill which would cut off all benefits to lone parents after five years. ‘They predicted it would lead to Calcutta on the Hudson,’ remembers Murray. ‘But lo and behold, welfare rolls went down by 40 per cent.’
All this was watched with fascination by Tony Blair and Gordon Brown, who were borrowing heavily from Bill Clinton’s ‘New Democrats’ as they constructed New Labour. In December 1997 they even went as far as to cut lone-parent benefit, administering a drop of the Clinton/Murray medicine to Britain. The ferocious Labour rebellion scared the Prime Minister off the subject for ever.
Brown has one idea left over from his ideological shopping trip to America — Sure Start nursery centres, designed to correct another function of poverty. Children from deprived backgrounds have poorer language and cognitive abilities, which Brown believes can be corrected with intense pre-school education. The idea has strong ideological appeal to Labour MPs, who see its extensive budget as a form of wealth redistribution. While the welfare state in America is retreating from the family, apologising for having disturbed it, Labour is moving the other way.
Murray groans when he hears about Sure Start, then laughs. ‘I have only one request for Gordon Brown: spend some money on evaluating these programmes. I will tell you right this minute, and bet the ranch on it, that a rigorous evaluation of the effect of Sure Start will yield a net impact of zero. It will do nothing, and all that’s needed is for Gordon Brown to pay the money to prove me wrong. And he will fail because we know what the limits are of these kinds of interventions. The United States tried them, we tried everything, we evaluated everything and n
othing worked. That is not hyperbole, that is a statement of 30 years of research.’
Brown is a little ahead of Murray here: he has commissioned an academic review of Sure Start, and its interim report six months ago did indeed show little to no impact from the £3.1 billion spent so far. But rather than end the experiment, Brown wants to roll out Sure Start across England by 2010 — pursuing the dream that the state can act in loco parentis. At a time when Britain is wealthier than at any point in history, it is decisions like these which Murray thinks perpetuate poverty.
‘I think the Left finds it very difficult to give up its power to stage-manage the lives of the people it is trying to help. Allowing people to do what they want causes them deep distress. Gordon Brown seems to show that as much as anybody.’ Murray adds that it is nothing personal: when he met Brown at the Treasury he found the Chancellor interesting and agreeable. ‘I found him engaging as a person. It’s his policies I have a problem with.’
Brown was given Murray’s book by a mutual friend, and it is highly likely that he will have read it. The Chancellor’s appetite for American politics is voracious: he used to return home from his Cape Cod holidays with suitcases full of books, even if only to acquaint himself with the enemy’s arguments. In such ways British politics is shaped by American thinkers such as Murray, without their names being known here. But will Murray’s thinking shape the Conservatives?
Murray holds out little hope. ‘Just look at the Tories, including my dear friend David Willetts, calling for a softer, kinder Conservative party. It’s hopeless. For some reason, in England you still cannot say, “I want to slash all these welfare programmes because they are screwing poor people to the wall.”’
Murray accepts from the outset that his plan is politically unacceptable, even in America. As a libertarian, he believes communities should be trusted to look after the poor without government intrusion — but if the state is to redistribute cash, he believes a flat annual grant will produce the most cohesive society. It is a compromise which he believes will irritate everybody. ‘The Right really doesn’t like the idea of handing out money to people. So I have now managed to alienate the Left, the neocons and the libertarians.’ And this is how he likes it. ‘I think I’ve managed to create the perfect storm.’