Whitehall “braced for private schools collapse” 6

[ICouldBeVioletSky]

Continuation of previous threads to discuss VAT on independent school fees.

@strawberrybubblegum ,

‘What diminishes a NNW carer isn't that a junior doctors earns 2-3 times more than them per hour: after 5 years of hard training (and with the personal ability to do it) for work which evidently is higher value.’

Whilst I agree, what I would say diminishes it more is an average investment banker or management consultant being paid 5-20 times what they earn-and I say this as an ex banker!

In my best year, I was both thrilled to get the money but also bemused by why I was paid so much more to do this than a doctor gets paid. Or a teacher, which I definitely thought when I was flat out working for 10-20% or what I used to get paid.

Reducing working age benefits, increasing the net income level difference between benefits and NMW work (and every level above that), reducing direct state involvement (eg moving towards a social insurance system for care - where people pay for carers directly and get a percentage of the cost back, as they do in some EU countrues) would together take us to a system which would work better for everyone.

Tax being taken from everyone to benefit everyone.

Arguably, cleaners, carers etc would then come closer to being net contributors- with their work genuinely valued according to its worth.

Possibly still not actually net contributors. I have no problem with a progressive tax system. My problem is with perverse disincentives which stop our society from functioning.

Only 4% of the population earn over £100k @newbutoldfather They simply aren't the problem.

@strawberrybubblegum ,

I think it is glib to say that. So much of policy is shaped by and for that 4%.

The UK has a very high Gini coefficient. And that is known to be problematic in a number of ways.

i suspect, though will never prove one way or the other, that the vast majority contributing to this thread lie in that 4%.

How convenient to blame “the state” as though it is a separate entity from the people living within it, despite the fact we live in a democracy. There is absolutely no history anywhere in the world that I am aware of where a small state has resulted in fairly paid cleaners and carers. What you are really arguing for is the continued undervaluing of people who used to be called “servants,” and making life worse still for people who do not do paid work, regardless of the reason for that inability. What you want won’t even help the middle classes, because a smaller state just gives more power and control to the elite who are busy undervaluing the skills of the middle classes, too, and replacing their work wherever possible with artificial intelligence. A smaller state just means more power directly in the hands of those who make money from assets, or from the labour of others, not from their own physical work. A few wealthy people who can afford to pay their personal staff a lot of money to clean for them and look after their dear old mama does not a fair, clean, wealthy, or healthy society make, as the vast majority cannot afford it unless they pool their resources and ensure that the whole of society benefits.

Basically, we’ve had small states for most of history, and there are few people eccentric enough not to recognise that most people’s lot was significantly worse in the past, so a small state is not something I personally want to rush back to, even though it is evident we are heading backwards, regardless.

I should probably also have quoted this when making my last post.

There is absolutely no history anywhere in the world that I am aware of where a small state has resulted in fairly paid cleaners and carers.

Actually, what leads to fair compensation is when people genuinely provide high value and there is competition for their work - regardless of what the work is, or how high-status. Post-plague Britain was a good example of this. (This does make the future of AI worrying.)

But likewise, there is no history anywhere in the world that I'm aware of where a large, redistributive state has sustainably given a high standard of living to its citizens, unless that was actually paid for out of natural resources. Look at the USSR and China: appalling financial mismanagement - as well as corruption - led to hugely reduced standards of living for all (even their government elite). I do mean sustainably: not our credit-funded post-war splurge, which we are now starting to have to pay back. Worrying times ahead.

How convenient to blame “the state” as though it is a separate entity from the people living within it, despite the fact we live in a democracy

"A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship. The average age of the world's greatest civilizations has been 200 years."

Alexander Fraser Tytler

A depressing thought. It isn’t true, though, that people vote for the party that promises the most benefits from the public treasury - they largely vote for the party which they think promises the most to the group with which they identify, unless they are enlightened enough to recognise when this is patently unfair and damaging, and not conditioned to believe that extreme self-centredness is a norm from which it is foolish to deviate. The “benefit” may be a promise not to tax their particular assets; or not to regulate or interfere with their activities, just as much as it may be to provide better public services or living standards. It might even be a promise to make other groups suffer - eg reduce benefits, make others pay more tax, but let you avoid it. When all the self-centredness has resulted in enough war, disease and destruction that even the elite have made their lives shit and need some help to get back on top again, they tolerate a bit more equality for a while, with whoever is left alive to help them get back on top.

Absolutely this.

I have a fantastic cleaner - best one I have ever come across. No idea why he picked this as a career as he's degree-educated and exceptionally well qualified to work in other higher paying sectors. Yes he charges a bit more than the average, but not massively more.

He sends his DC to the local private school.

Iyo is the bigger the state the better? Should it be more controlling to make sure people don’t opt out etc

Whilst this cycle might resonate with what the 'right-thinking liberal left' think should happen, it doesn't seem to match history very well.

Can you be more specific about which historic periods you're referring to, particularly the bit about 'when self-centredness has resulted in enough war, disease and destruction that even the elite have made their lives shit and need some help to get back on top again, they tolerate a bit more equality for a while, with whoever is left alive to help them get back on top' ?

Post-the second world war. That was enough to shock the British into all sorts of historically out of character behaviour… All sorts of checks and balances were put in place after that in an attempt to stop the world heading in that direction again. All of that, of course, is now busily being dismantled, so here we go again.

Imo, the modern capitalist state is inevitably small, because modern states are less powerful than the global marketplace, resulting in a lot of empty promises by individual states which have no ability to carry through on their promises. This country does not even have control over its own assets and we are world experts on advising how wealth can be hidden outside of the control of any state.

All that “taking back control” does is create friction when no country is capable of being self-sustaining in the modern world, so it’s friction that brings no benefits unless the “control” taken back is control over every other country in the world, not just our own. We are all just rats thinking we can desert a sinking ship, but the sinking ship is also the only life raft, so we’ll all end up just drowning or fighting the other rats until we achieve mutually assured destruction. Trump appears to think he can take over the world and become Emperor of the lot of it, of course. I’m pretty pessimistic of there being a way out, therefore, whatever size the individual state attempts to be, because much as we like to think we can pull up our drawbridges, that only works if we fancy starving ourselves to death.

I don't think it's bizarre at all. Look at the enormous endowments and donations incomes enjoyed by Ivy League universities in the US. People very often feel loyalty and obligation towards the institutions that have educated and inspired them and, crucially, made them, or their children, feel part of something elite and significant. And, of course, they feel a sense of ownership, too. The biggest donors usually seek to have some influence over the direction of the institutions to which they give their fortunes.
You say this 'takes away from middle classes donating to the state sector'. No, I don't think it does, or at least, not in a way that the VAT changes will fix. For one thing, the actual middle classes the ones who are going to have to move their children back into the state sector as a result of VAT on school fees are unlikely to be very big donors. If they had that sort of money they wouldn't be moving their kids back into state schools unwillingly. But there are also important psychological reasons that I don't think these donations would simply be transferred to state schools. I can imagine that the following might be some of those reasons:

• Parents giving large donations frequently attended that school themselves as well as sending their children there;
• There's a big psychological difference between contributing additional funds to a school you're already paying directly to educate your child, and over which you likely feel you have some degree of influence, to contributing additional funds to a school that you likely feel you pay disproportionately for through your taxes, and over which you have pretty much no influence at all;
• When people give money at black tie gala events such as the one you describe there is usually a significant group psychology element. Others are also giving, so there is likely to be a sense of shared endeavour or competition to stimulate additional generosity. This is hard to replicate at a state school where income levels are likely to be much more varied, and where middle class parents may not enjoy any particular feeling of fellowship or shared values with the parents of their children's classmates;
• Middle class children in state education are generally given less attention, not more, than their less privileged peers. That's understandable, actually, because the home environment usually picks up the slack, but knowing that your bright little girl is spending half her lessons acting as an unpaid TA to some other kid, or that your well behaved little boy is routinely placed next to a noisy child to help manage that child's behaviour in class is more likely to inspire adversarial than financially generous feelings.

Most importantly, though, the most serious problems with state education are not going to be fixed by donations. This might help to improve the physical estate of the school it could remove a few asbestos panels or build a better sports facility but it's not going to produce smaller classes, better staffing, higher quality teachers, a more ambitious academic culture, improved SEND provision, or better behaviour from students. It is absolutely absurd to think that, when 93% of parents send their children to state schools already, forcing the least wealthy and least powerful of the 7% that use private schools to move into the state sector will suddenly bring about an influx of philanthropy and unpaid work as governors and volunteers that will fix the deep financial and often cultural malaise of a sector in crisis -- particularly when the government insists on loading unfunded pay rises onto schools already struggling to balance the accounts. That's magical thinking of the wildest and least productive kind.

And, by the way, I write this as the parent of children at a state school at which I do volunteer and to which I donate what little I can.

Unfortunately for the impecunious middle classes, the elite apparently don’t care, the “working class” don’t care, and the underclass don’t care if they are priced out of the elite institutions. Everything is someone else’s problem until it truly becomes everyone’s problem.

Whilst you could probably argue that WW2 was started in Germany due to people voting "for the party which they think promises the most to the group with which they identify", it was the general population behaving that way, not only the elite - and it was the result of pretty extreme political turmoil and almost complete economic collapse. The kind of thing any country should be afraid of. (Those complaining about the bank bailouts should remember this).

The Allies didn't have much choice about entering WW2: they were either being invaded or seeing that in their near future. So I don't think it really fits with your imagined cycle of the elite causing "war, disease and destruction"

There were certainly social changes after WW2. I've never seen it suggested that they were due to "the elite having made their lives shit and need some help to get back on top again" though.

Women had entered the workplace whilst men were absent, and were still needed to rebuild the country. That's closer to the reason I gave: when there is competition for our work, we are valued and fairly paid. The learning to take from that is that to genuinely help people, we should train our young people and give them opportunities to become valuable, productive employees: not distort reward through an overly generous welfare state, so that an ever-smaller productive segment of the population pay everyone else to do nothing/do things which aren't useful. At the extreme, this was why communism resulted in such low standards of living - and we see that playing out in a bloated state here in the UK too.

There was also genuine optimism for the future from the whole population: including the political elite. I really don't think that the creation of the NHS, the welfare state, the UN etc came from any kind of attempt by the elite "to get back on top again". Again, I've never seen that suggested.

The political elite - it's true - were determined to take any steps possible to avoid going through the hell of war again - hence the de-natzification of Germany and the creation of the UN - but I've seen nothing to suggest it was because the war was their doing: just because it was hell.

Unfortunately, large institutions take on a life and direction of their own, when those in charge of them over-reach through a combination of belief in the importance of their own institution (which is partly knowledge and a sense of ownership, and partly hubris), and also because institutional growth and over-reach benefits their personal ambition. That's why the state (and international equivalents) have got bigger and bigger over the decades - to the point of the population's detriment, imo.

If you are looking at the risk of future war becoming more possible (which I fear too) then look at how WW2 started. It's economic collapse which you should most fear, not a slight reduction in power of bloated institutions. The UN is just a way for countries to talk to each other, it was never meant to be (and could never be) a world-wide government.

And that's where I think Alexander Fraser Tytler is relevant.

Stop trying to extract ever-increasing taxes from a tiny, productive part of the population - whose broad shoulders will pretty soon give up, leaving the country in deep shit because those shoulders were such a small proportion of the population.

Stop undermining our population's chances at training and job opportunities through the short-sighted policy of high immigration.

Stop distorting incentives for people to be productive, by blurring the boundary with welfare and by removing the entirely appropriate gap in lifestyle.

And stop blaming 'the elite'. It's a shadow monster. Used by people with their own agenda to increase division.

@RoseAndGeranium ,

Your PP is a great explanation of the psychology of why people prefer to ‘give’ selfishly rather than selflessly. Although you forgot that they will also have their name on a theatre chair or a gold leaf on the giving tree somewhere in the school.

Ostentatious giving used to be considered crass but has now been normalised.

But what I take issue with and can rebut with 100% knowledge is that giving to state schools won’t improve the education. It definitely can and does. One of my many donations to my children’s primary paid for therapeutic intervention, which improved classroom behaviour and improved the learning environment for everyone.

Also, a school’s budget has to pay for all the essentials but also things like staff wellbeing, IT, staff development. If donations can pay for more of those the school can divert all its budget into education, which will improve outcomes.

Where are you extrapolating that I am saying only the elite are self-centred or only to blame? It’s not only the elite who vote.

However, when it comes to WW2, that was largely caused by WW1 (Germany would not have ended up in that economic situation without WW1 and its treatment by the winning sides afterwards), which was largely caused by competitive Empire building. Who ran the countries which went into WW1? Who led the armies out onto the battlefield? It’s a bit of a cheek to claim the skills of leadership, but refuse any responsibility for the end results, imvho. If an entire population is to suffer the inevitable consequences of risky, acquisitive behaviour, it’s not surprising that the entire population clamours for more of a share of the benefits in the good times, given the inevitability of the next disaster. No point pretending those at the top are going to stop leading you into another disaster.

As for tax, yet again you make assumptions, rather than reading what I write. I haven’t at any point said what I think about VAT on school fees. It was always rather obvious they wouldn’t raise huge amounts of money for state schools or anything else, just as it is obvious cutting welfare and trying to cut immigration isn’t going to stop us heading where we are heading, either. Your imagined bogeyman is lazy and feckless people, just as others blame the elite, what with the elite being the biggest consumers of them all. Nobody wants to blame people living too long and expecting to be looked after, or modern technology and medicine keeping the weak and vulnerable unhelpfully alive - it’s easier to blame the dwindling working age population, or immigrants.

As for your last paragraph, that’s a good description of multi-national corporations and billionnaires, although I’m not sure if you meant it to be. Regardless, kleptocracy appears to be the direction of travel.

Basically, we are all caught in a quagmire of selfishness and self-justification, to the point that people will even argue that if their children have to go to state school, they wouldn’t donate much to the school, because too many other people not like them might benefit.

My bogeyman is ideological political behaviour which ignores real outcomes in favour of some utopian vision of how people 'should' behave. And how great everything would be 'if only' people were less selfish.

My objection to the bloated welfare state isn't that recipients are 'lazy and feckless' as you say: it's that those recipients are behaving rationally in response to perverse financial incentives - created by unrealistic ideologists. And the end result is that we are all worse off than if those well-meaning idealists had been a bit more realistic about rational human behaviour.

@strawberrybubblegum ,

What about QE, Covid payments (which ended in the hands of ten wealthy), the 2008 bank bailout, which bailed out millionaires by taxing the middle classes.

These were all conscious choices of those in power to help the wealthy at the expense of the poor.

Gary Stevenson explains this well. I am not 100% in agreement with him but he makes a lot of good points and backs them up with solid economic data.

And again, you fail to engage with reality, whilst claiming to engage with reality. How are you planning to deal with a shrinking working age population and growing elderly population? Do you genuinely think the only problem is the benefit system?

Like I said, there is no point staying in this country if you have young clever kids who are highly skilled. They will have a better life in many other developed countries.
Yet again they have rolled back on WFA pandering to the elderly vote at the expense of child benefit for poorer kids. They cannot afford both. The solution is very simple - make all the rich elderly fill in a tax form to repay fuel allowance just like we have to do for child benefit. There aren’t enough children being born but there are too many old people. And all the politicians care about is buying the elderly vote. It is not forward planning whatsoever. So people need to vote with their feet and get out, there is no other solution at this point.