Week 2 Flashcards

(38 cards)

1
Q

Distributive justice

A

What is a fair way to distribute our
limited material resources?

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2
Q

Egalitarianism

A
  • Everyone gets the same
  • Seems unfair if some people produce more or
    work harder
  • Some might need more than others
  • Might be inefficient
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3
Q

Rawls’ difference principle

A
  • Inequality is justified if it makes life better for
    the poorest
  • Does relative position matter? What does a
    billionaire class or aristocracy do to cohesion?
  • Is it fair? Don’t people who work harder and
    produce more deserve more?
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4
Q

Equality of opportunity

A

Differences in outcome are acceptable
when they stem from choices for which
individuals can be fairly held responsible.
* Levelling the playing field
* What kinds of things can we consider?
* Differences by race and gender?
* Different family circumstances?
* Different natural abilities?
* Different personal motivations?

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5
Q

Utilitarianism

A
  • Maximize ‘preference satisfaction’ – people
    getting what they want
  • Seems ok for an individual, but for a group it
    might violate ‘commonsense morality’, e.g.
    racial oppression if this makes many racists
    very happy
  • Requires ‘apples and oranges’ comparisons
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6
Q

Just deserts

A
  • Different ways of thinking about this:
  • People get out of society what they
    contribute to society
  • People are rewarded for effort
  • People are compensated for costs
    incurred
  • Only effort directed towards
    increasing the size of the pie warrants
    a larger slice of the pie
  • Is this fair if there are unequal
    opportunities to contribute?
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7
Q

Libertarianism

A
  • If we achieve justice in acquisition and
    transfer of property, then the final
    distribution, whatever it might be, is
    inherently just
  • Original acquisition of property rarely just
  • People may accumulate wealth through
    luck or without contributing
  • Does not treat taxation as legitimate
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8
Q

Feminist critiques

A
  • Gender is an important consideration
    because differences are not entirely social –
    as long biological parents raise children in
    family units, differences will exist
  • Do we take a liberal position? Minimal role of
    government in the economic sphere only?
  • Do we ask government to be more active in
    redistributing wealth?
  • Do we give the state a more robust role in
    personal lives, e.g. reorganizing ‘the family’?
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9
Q

Defining poverty
Our working definition

A

Not enough material resources
* Focus on material resources – other
forms of deprivation (e.g. social status,
political power, opportunity, freedom etc.)
are explanatory
* What counts as ‘enough’?
* Basic standard of living – ‘absolute
poverty’
* Comparison to others in society – ‘relative
poverty’
* A reasonable standard of living – a hybrid
of concepts

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10
Q

Poverty may be a problem for distributive
justice:

A
  • Egalitarianism – it is unacceptable if some
    are rich and some are poor
  • Rawls’ difference principle – we must strive
    to lift up the poorest
    Poverty and distributive justice
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11
Q

Poverty may not always be a problem for
distributive justice

A
  • Equal opportunity – what if the poor squandered
    good opportunities?
  • Just deserts – what if people choose poverty
    over effort?
  • Utilitarianism – what if some need to be poor for
    the collective good?
  • Libertarianism – what if poverty results from just
    acquisition and transfers of property?
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12
Q

Poverty and inequality in Australia
ACOSS / UNSW report measures

A

Relative rates
* 50% of median
* 60% of median
* Adjusts for household composition

Different poverty lines for singles vs. couples, with children vs without children

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13
Q

Causes of poverty

Individual explanations

A

Individuals are unable or unwilling to
participate in the market economy
* Job seeking support
* Budgeting and financial literacy
support
* Education and training
* Incentivise work (and punish failure
to work)
Individual explanations

Who do these explanations work for?
* The poor?
* Practitioners?
* Policy makers?

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14
Q

Causes of poverty

Cultural and behavioural explanations

A

Shared non-productive values
* Poor communities where not working
becomes normalised
* Underclass
* Welfare dependency
* Cycle of deprivation and
intergenerational poverty

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15
Q

Causes of poverty

Cultural and behavioural explanations cont…

A

Shared non-productive values
* Early intervention (i.e. early in the life
course)
* Mutual obligation
* Paradoxical removal of welfare
Cultural and behavioural explanations

Who does this explanation work for?
* The poor?
* Practitioners?
* Policy makers?
Cultural and behavioural explanations

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16
Q

Causes of Poverty
Structural explanations

A

The way society is organised produces
poverty for some.
* E.g. there is an inverse relationship
between inflation (devaluation of
money) and unemployment – the
Phillips Curve
* There is a ‘natural’ rate of
unemployment

The way society is organised produces
poverty for some.
* E.g. the labour market
* Cost of labour determined by supply
and demand
* What if equilibrium is below living
standards?
* What if we introduce a minimum wage?
Structural explanations

  • Economy is complex!
  • All sorts of policies and events can
    affect the economy and generate or
    reduce poverty
    Structural explanations
17
Q

Discourses
about poverty

Poverty and blame

A
  • Individual explanations are intuitive
  • Humans have self-serving cognitive biases
  • If I’m successful, it must be because of my own hard
    work
  • If my outcome is fair, life must be fair
  • Therefore, people who are poor caused their own
    poverty
  • Easy to confuse cause and effect in cultural
    explanations
  • Poor neighbourhoods are filled with crime and
    violence, therefore poor people are deviant
  • Poor people use drugs and alcohol, therefore poor
    people lack moral character
  • Poor people lack education, therefore poor people are
    stupid
18
Q

Deserving poor

A

Those who are obviously blameless
* Children
* Disabled
* Sick
* Elderly
* DV victims
Deserving poor

19
Q

Undeserving poor

A

Everyone else

Characterised as
* Lazy
* Stupid
* Immoral, deviant, criminal
* Dirty
* Bad parents
Undeserving poor

20
Q

Privilege of wealth

A

Discourses of poverty and welfare colour
interpretations of facts
* Cultural explanations of poverty
* Individual explanations of poverty
* Personal responsibility
* The poor are visible and scrutinised
* The poor are subject to surveillance

21
Q

Images of poverty

A
  • Emotive?
  • Powerful?
  • Engender sympathy?
  • Perhaps useful for raising awareness
    and advocating for change?
  • Or do they just reinforce neo-liberal
    discourses?
  • Reinforce neo-liberal discourses
  • Literally and morally unclean people
  • Children the focus as deserving poor
  • Isolated and excluded
  • Poverty and parenting
  • These images may do more harm than
    good.
22
Q

Approaches to welfare
Social democratic welfare states

A

State provides what citizens need:
* Education, health, housing, money

  • Concerned with wealth distribution
  • Democratic – politically and socially

Capitalist:
* Markets are constructed
* Markets should be regulated
* Unions are necessary

  • Interventions into private sphere
    accepted
  • Examples - Scandinavia
23
Q

Approaches to welfare
(Contemporary) libertarianism

A
  • Private individual rights – especially
    property
  • State not legitimate
  • Freedom from rather than freedom to
  • Hostile to state intervention especially tax
  • Prefer
  • Private sector and private charity
  • Markets (natural and good)
  • User-pays
  • Examples – Republican Tea Party
24
Q

Approaches to welfare
(Neo)Liberal welfare

A

Legitimate role for the state but also
individualism and self reliance
* Government’s role is to create conditions
for citizens to flourish in the market
* “A hand up; not a hand out”

  • Fund services that improve economic
    conditions e.g. education
  • Welfare is a safety net for temporary
    periods of disconnection from labour
    market

Concern about how welfare will affect
markets:
* Remove incentive to work
* Distort cost of labour
* Inflexibility in the labour market
* Welfare traps
* Demographic change – aging population
* A burden for working citizens
* Distorts markets where private enterprise
must compete with public organisations

  • Empirical evidence suggests valid but
    often overstated concerns
  • Generous with welfare connected to
    work (occupational and fiscal)
  • Those who earn the most are assumed
    to be the most productive and can
    therefore be rewarded by welfare
  • The main goal of welfare is to shift
    people into the labour market

Examples
* Australia
* USA
* UK
* NZ
* Canada
* Note: both parties in Australia are neo-
liberal
* Since the 80s we have a neo-liberal
consensus

25
History of welfare in Australia
Pre-WWII – colonies responsible * 1900s – aged pension, disability pension plus charity WWII and post-War: * Federal government took over taxation * Introduced federal widow’s pension, child endowment, unemployment benefit, sickness benefit * Manufacturing boom to support * Housing costs low, wages high, unemployment low and frictional * Public service employer of last resort
26
Whitlam
* Elected in 1972, dismissed 1975 * Short-lived but transformative government * Social democratic style reform * Free tertiary education * Free health care * Expansion of cash transfers – single mother’s pension * Other socially progressive reforms changed the nature of society and family e.g. * no-fault divorce * Indigenous rights
27
Neo-liberalism
* Late-70s onwards * Mirrored changes in USA and UK * Thatcherism, Reaganomics, supply- side economics, trickle down, free- market economics, voodoo economics * State’s role to support markets * No longer employer of last resort * Acceptable ‘natural unemployment’ rate 5% * New issue – long-term unemployment * Pressure on social welfare budget * means testing implemented * requirements to apply for and accept jobs * Social welfare system not about alleviating poverty – about moving people back into the labour market
28
Neo-liberalism - compulsory superannuation
* Hawke/Keating * Part of regular pay rise to be compulsory superannuation * Reduce burden on social welfare budget, fix intergenerational burden and aging population problem * Transfer aged subsistence from social to occupational welfare * Increasingly an avenue for fiscal welfare
29
Neo-liberalism - Howard government reforms
* Mutual obligation and breaches * Privatisation of service delivery (Centrelink) * Work for the Dole * Shift people from pensions to Newstart and then into work * Growing middle-class welfare (social and fiscal) * The Intervention * Northern Territory * Concern for children * Suspend Racial Discrimination Act * Range of draconian measures including income quarantining * Work Choices * Enhance labour market flexibility * Unpopular in the electorate
30
Neo-liberalism - Rudd and Gillard
* Scrapped Work Choices * Work for the Dole a voluntary program * Expanded income quarantining to reinstate the RDA * Continued to build superannuation * Stimulus to respond to the Global Financial Crisis
31
Global Financial Crisis
* Strong US economy with rising house prices Borrowers willing to take on risky loans * Small or no deposit * Introductory rates with balloon payments * The aim is to ‘flip’ the house Banks willing to make risky loans * Exorbitant interest rates on ‘subprime’ loans * Sell ‘mortgage-backed securities’ on Wall Street so no chance of loss to the retail bank * Securities became incomprehensible * Ratings agencies not functioning * Poor regulation
32
Global Financial Crisis cont...
Weakening housing market created vicious cycle * Investors unable to flip houses, unable to pay loans * Loan defaults flood the market with foreclosed properties * House prices drop further * Even harder to flip houses * Huge volume of mortgage-backed securities became worthless overnight * Many investors bought mortgage-backed securities with loans that they could not extend * Investment banks collapsed * All investors tried to pull their money out at the same time – everyone selling and no one buying Global Financial Crisis
33
Global Financial Crisis cont...
Financial market dysfunction * No one can borrow money * Businesses need loans to function * Business failure increases unemployment * Lack of consumer and business confidence means no one would spend money, putting more pressure on businesses Policy responses * Record low interest rates * Bail out banks to support credit * Massive handouts in USA * Government backed guarantee in Australia * Cash to households to increase consumer demand
34
Global Financial Crisis cont...
Australia weathered the storm comparatively well * Limited exposure to US housing markets * Economy increasingly linked to Chinese exports, which remained strong * Stronger lending and banking regulations in Australia * Robust and rapid stimulus response from government and reduction in interest rates from the Reserve Bank * Subsequent tightening of regulation
35
Post GFC changes
Abbott/Hockey budget * Lifters and leaners * Austerity budget * Unpopular and blocked by Senate Plan-B – crackdown with technology * Surveillance * Self-service (and reduced service) * Basics Card * Robo-debt
36
COVID - 19
* Economic shutdown due to public health policy * Supply shock * Business disruption, supply chain disruption, unemployment * Supply-side problems create demand problems as consumers have no money to spend Supply problem Demand problem Policy responses Public health response * Limited help for demand * Coronavirus supplement * Stimulus payments Suspended animation for businesses * JobKeeper * Loans * Grants * Industry subsidy
37
Current policy
* Shift towards more generous (but still neo-liberal) welfare * Boost funding for Medicare * Boost funding for education * Boost child care subsidies
38
Stage 3 tax cuts
Originally legislated by Morrison government * Total cost over 10 years = $243 billion * All benefits overwhelming to high-income earners Stage 3 tax cuts going ahead...for now