Tuesday, 30 March 2010

Opting out of progress?

Newspapers and websites are full of it, yes, yes – sometimes in that way too, but I mean the debate on public spending.

At a time of economic crisis there is increasing pressure on governments to restrict public budgets, make cuts. Public spending at the moment is a big issue in the upcoming UK general election (how much? [Love the backing music by the way!]), it is an issue for healthcare reformists in the US (what for?), and child policy reform in Japan (who for?). In democracies with competing priorities it is an issue that never goes away.

But what can we pay for now, what given all of the choices and in a time of crisis would you say must not be cut… what should we pay for now? What in a time of increasing constraint on household incomes would you put your hand in your pocket for (or have a dig around down the back of the sofa for). Amongst the many worthy causes – the poor, the frail elderly, health care, homelessness, education and employment supports – I would highlight one with a long term perspective: child policies… Let me explain.

Spending early in the lifecycle is important for many reasons. First it is good for progress. Children are the entering into the social and economic sphere and any spending on them will generate returns for the longest possible period. Second, it is efficient. Later and more costly spending will be necessary in adulthood if people fail to find work, get sick, or require further education or retraining. Spending well in the early years reduces the burden on ‘catch-up’ or ‘fix’ spending in later years. Third it is equitable. Well placed spending can be used to close or reduce gaps for disadvantaged children before gaps become unmanageable and restrict opportunities. Finally, also in terms of equity I will simply ask this question: How many children do you know who chose the family and society into which they would be born? None you say? I guessed as much.

We live in societies that appreciate the need for healthy and educated populations. If societies don’t prepare a child in the ways of healthy living, protect them sufficiently from debilitating disease, and teach them how to make the most of their opportunities the society will pay for it later. Notwithstanding the complexities of causality, examples are found in intergenerational transmission of welfare dependency, education, as well as health and risk behaviours. Lives will not flourish, and consequently a certain level of dependency is inevitable (directly or indirectly). And so yes, unless you intend to buy an island and abandon the life of a citizen in a modern democratic society, you - the taxpayer - will quite literally pay for it later.

Economics tells us that the provision of goods we wouldn’t pay for ourselves but otherwise benefit from (and so free-ride) requires a public role: lights on the street at night, roads, healthy and educated neighbours, workers, etc.etc. It also tells us that if we club together we can do things cheaper and yet achieve equivalent outcomes.

As the economic crisis bites, child welfare, health and education services can suffer cuts alongside many other important policies, but can we afford to put off additional investment in our future; can we afford to opt out of progress?

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