Andrew Willshire is founder of the independent strategic analytics consultancy Diametrical Ltd.
There is clearly something fundamental in human nature when multiple cultures have matching proverbs. For example, the American saying “shirtsleeves to shirtsleeves in three generations” is mirrored by the Japanese “the third generation ruins the house,” the Italian “vrom stalls to stars to stalls,” and the Chinese “wealth never survives three generations”.
It’s understandable, of course. People from impoverished backgrounds who have succeeded often still avoid spending money on things they can’t afford, and they still value what they gained through their own efforts.
But across the generations, gradually the habits of the poor are replaced by the habits of the rich, especially when moving in circles inhabited by other rich people. Ostentatious displays of wealth, such as expensive houses, clothes, jewellery, watches, cars, holidays, and meals, are used to convert financial capital into social capital, and replenishing the former becomes of secondary importance.
Eventually, the well runs dry and the family is back where it started: poor.
It should be apparent that the same phenomenon applies to countries as well. The powers of the state allow the time period to be stretched considerably; as Adam Smith said, “there is a great deal of ruin in a nation”. But a great deal is not the same as an indefinite amount. At some point, a country needs to reflect on whether it is on track to be back in the global poor house.
The trouble is that politicians are determined to convert the nation’s accumulated wealth into social (or political) capital, both with the voters and with their peers in other countries. As such, they adopt (and define) the habits of “rich countries” while forgetting what it cost to become rich.
Too often we hear the refrain: “We’re the fifth-richest country in the world and if we can’t even do X, then it’s a disgrace”, with “X” usually involving increasing government spending by a non-trivial amount. Unfortunately, this argument is like arriving home in a supercar and telling your spouse that “We’re the fifth-richest family on the street – not driving a Ferrari would be a disgrace!”
A relative position does not guarantee the absolute means to deliver on our preconceptions – or even to maintain that relative prosperity over the long-term.
What are the most fundamental duties of a government, since even the pre-industrial age? Defence of the realm, the provision of law and order, and organising the building of critical infrastructure.
So how can it be, “in the fifth richest country in the world”, that our armed forces are starved of resources, a rape trial can take four years to be heard, our police no longer investigate burglaries and shoplifting, we suffer periodic water-rationing, and our energy security is dubious at best?
The fact is that those fundamental elements of building a functioning society up from the ground have fallen victim to our “rich country” habits.
Poor societies lack the resources to look after economically unproductive people, and there is serious stigma towards those who are able to work but choose not to. It is only rich countries that are content to fund such lifestyles, and this includes paying ever-increasing pensions for 30 years and more to people many of whom could still contribute in some form.
In most societies, children receive the level of education which best enables them to contribute to their family’s income. There is no notion of “education for the sake of education” except among the rich. The idea that a child could be expensively educated to the age of 23, but still be unable to contribute economically, would be regarded as madness in most parts of the world and through most of history.
Only in rich countries would it be accepted that the view from a window, or “the local character” of an area, was of more importance than having sufficient houses for people to live in, such that families could live close together. Or that an empty field is preferable to a factory that might employ people. Or that we should ostentatiously use energy that is four times more expensive than it is in other countries in order to “set an example”.
And only rich countries would spend a vast proportion of their national wealth on prolonging the lives of those who are sadly in their final days, even while maternity wards descend into chaos and working people are forced, despite record tax levels, to pay again for private medicine because there is no capacity to treat them in a timely manner.
It is absolutely right that we should spend some of our wealth to look after the less fortunate among us, as even the most primitive societies do. But surely it has to be limited to the amount that we can sustainably afford?
Edmund Burke famously described society as a partnership or bond between the dead, the living, and the unborn future generations. Our forebears worked hard to place us in the privileged position which we inhabit in today’s world.
But we inherited that position without having to work for it, and now we’re far more interested in spending and consuming our wealth than in earning it. How could anyone look at the financial projections in the recent Budget, while also considering the parlous state of our public services, and conclude that we are preserving our societal wealth for future generations?
The Scottish variant of the opening proverb is: “the father buys, the son builds, the grandchild sells, and his son begs.” Right now, we’re selling everything we have, just about as fast as we can in order to maintain our lifestyle. It’s time to examine our habits before we beggar our children.
The post Andrew Willshire: Britain is being beggared by our stubborn delusions about being a wealthy country appeared first on Conservative Home.
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Author: Andrew Willshire
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