David Coates

Different elections, similar issues: the UK and the US at the polls

As the United Kingdom comes to the end of its very short general election cycle, the United States is gearing up for the start of its next very long one.

Yet, for all the differences of electoral timing and length, the main lines of the US debate on domestic policy are ones that a UK audience will recognize well enough – the pursuit of economic growth and the promise of rising living standards, the role of government and the size of public debt, the problem of immigration and the widening gap between the rich and the poor.

The main alternatives on offer from each side of the US political aisle have UK parallels too. ‘Welfare cuts and limited government’ as the route to economic growth from the more conservative side, ‘greater social justice and more public spending’ from the less conservative one, with the more conservative case laid out with greater clarity and zeal than its more progressive alternative.

Quite what Hillary Clinton stands for is yet to be determined. She has begun her campaign presenting herself as an out-and-out American populist, but that may not last. What Rand Paul, Marco Rubio and Ted Cruz will do domestically if elected president, however, is already clear. They will cut the US welfare safety-net even further to the bone. It is not only in the United Kingdom that the return of a conservative government would significantly deconstruct welfare structures put in place since the Second World War (the UK case) and since the 1930s (the US case). Post-war welfare settlements are under attack in both of the model Anglo-American economies. In neither of them right now is it much fun to be welfare-dependent.

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That would perhaps not matter greatly if there was very little poverty left in contemporary America. It would certainly matter less if it was the case that, without adequate welfare payments, the American poor could move quickly and easily into well-paying jobs in the American private sector. And it would perhaps not matter at all if the big problem in US welfare politics was the growing sense of entitlement to government handouts now accumulating at the bottom of the American income-ladder.

But it does matter. It matters enormously. It matters because severe poverty is extensive and entrenched in every one of America’s 50 states. It matters because US wage rates are – for a remarkably large number of American workers – both stagnant and modest. And it matters because America does indeed suffer from a culture of welfare dependency and entitlement. It just happens to be a culture of entitlement firmly rooted, not at the bottom but at the top of American society – an entitlement culture alive and well in the private conversations and political rhetoric of America’s rich.

If you doubt that, consider this:

  • The official rate of poverty in the United States remains at 14.5%. That is one American in seven, over 45 million Americans in total. Nearly as many Americans living in poverty as people living in England in its entirety. One American child in five is currently living in a family whose income puts it in/on the edge of poverty; and today, 46.5 million Americans need food stamps to survive. Yet food stamps average less than US$5/person per day. Moreover, in a state like Kentucky, if you are dependent on such welfare payments, you are now also legally banned from spending that meagre money on a whole range of simple pleasures: things like movies, swimming pools, cruises (not likely, really, is it?) or tattoo-parlours. Being on welfare in the United States these days is not only tough, it also gives you second-class status.
  • Reducing the numbers dependent on welfare is clearly the premier Republican welfare-aim; and in justifying that as an effective anti-poverty policy, many conservatives regularly point to the way in which their 1996 legislation brought welfare-rolls down by compelling welfare recipients to find private-sector employment. But welfare-to-work is only effective if well-paying private sector jobs are plentiful; and right now, they are not. The US economy is currently struggling to create enough new jobs merely to match growth in the available labour force; and the jobs being created on average pay far less than the jobs lost since 2008. In 2014, 42% of U.S. workers made less than US$15 an hour, with six of the ten largest occupations paying median incomes of less than US$15/hour also ranked among those most likely to expand over the coming decade. This means that a full-time worker putting in 2000 hours a year grosses just US$30,000, when the US official poverty rate puts a family of five in poverty at US$27,570. Reducing welfare-rolls in the contemporary US economy does not solve poverty. It simply moves it around.
  • The biggest tax subsidies in the current US tax code do not go to the American poor. They go to middle-class Americans in tax relief on their healthcare premiums and on their home mortgages (including their second mortgages). They go to upper-class Americans via a lower rate of taxation on capital gains than on incomes; and they go to corporate America in the form of subsidies (to agriculture, oil and pharmaceuticals, among others), guaranteed contracts (from the Pentagon) and simple bail-outs (as with the banks). Yet the ferocity of the defence of income and wealth by the privileged in America has never been more strident. Often hiding behind a libertarian rhetoric largely absent in the United Kingdom, the American rich defend their privileges by the politicians they buy, the candidates they fund, and the media outlets they dominate. The Koch brothers’ current plan to spend US$889 million to ensure a Republican in the White House in 2017 is just the most blatant example of a string of attempts by America’s rich to make sure that their riches remain their own – taxed little if taxed at all.

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Many of these class-divisions that so scar contemporary American society are obscured from public view by questions of race and ethnicity. To be poor in America is tough. To be poor and black or Hispanic is tough twice over; and sadly, too often the greatest immediate animosity you will experience being poor and ethnic will come from those who share your economic condition but not your race. The American working class is a divided one in ways in which the UK’s is not. Those divisions loom in the UK, of course, where we are currently witnessing, as the economy falters, the rise of an ugly politics of an anti-immigrant kind. It is ugly – genuinely ugly – but it also relatively recent, and it is widely condemned. The racism that informs American politics runs deeper and is less visible than that. It has a longer history, and it is all the more intractable for now being officially hidden.

The racial and ethnic divisions between the American poor and the American low-paid will not go away until progressives in America put at the heart of their politics a strategy for economic growth based on a narrowing of income inequality, a restoration of rising wages, and the creation of a safety-net that helps (rather than drives) welfare recipients out of poverty – Lyndon Johnson’s ‘hand up’ rather than ‘hand out’. Putting that strategy together is the pressing need of the age. It would help enormously if, after May 7, progressive political parties in the UK would co-operate to show the way!

First published on SPERI Comment,

the website of the University of Sheffield Political Economy Research Institute

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David Coates holds the Worrell Chair in Anglo-American Studies at Wake Forest University. He is the author of Answering Back: Liberal Responses to Conservative Arguments, New York: Continuum Books, 2010.

He writes here in a personal capacity.

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