Child poverty: the bullshit factor

by Don Franks

I don’t care what anyone thinks, I’ve had enough of all the talk about child poverty.  Some of the talk is well-intentioned, but much of it’s actually bullshit.

Phrases roll off the tongue but what does poverty mean in New Zealand today?

The Ministry of Social Development works from the level of income set at  60% of median household disposable income after housing costs. This is deemed a reasonable level to protect people from the worst effects of poverty.

Source: Stats NZ 2016

In these terms it’s calculated that the poverty line after deducting housing costs for a household with two adults and two children lies at $600 per week or $31,200 annually in 2016 dollars. For a sole parent with one child it is $385 per week or $20,200 annually in 2016 dollars. Inadequate amounts of money for a decent life and, by such reckoning, there are around 682,50 people in poverty in this country, or one in seven households.

New Zealand is a far more unequal country than it was a generation back. Over the past three decades, under both National- and Labour-led governments, New Zealand has gone from being one of the most equal to one of the most unequal nations in the wealthy OECD countries.  In those 30 years, incomes for the average of the top 10% income earners roughly doubled while lower and middle incomes barely increased. Let’s compare two reports, almost a decade apart.

The 2007 Statistics Department study Wealth and disparities in New Zealand revealed that the top 10% of wealthy New Zealand individuals owned over half of New Zealand’s total net worth, and nearly one fifth of total net worth was owned by the top one percent of wealthy individuals. At the halfway mark, the bottom half of the population collectively owned a mere 5 percent of total net worth.

The most recent available information is a 2016 Statistics Department study Household Net Worth Statistics: Year ended June 2015 (published 2016).  It reveals that the top 10% of wealthy New Zealand individuals own about half of New Zealand’s total net worth (47%), and nearly one fifth of total net worth is owned by the top one percent of wealthy individuals. The bottom 40% of the population collectively owns a mere 3 percent of total net worth.

In other words, we had massive wealth disparity at the end of the fifth Labour-led government and we have massive wealth disparity now at the end of the fifth National-led government.

There would seem to be three possible reactions to this trend.

Obviously the top ten percent would say everything’s fine, leave the system just as it is.

A common reaction from the bottom half would be, well, I don’t like this inequality and it’s not fair, but there’s nothing you can do.

A third reaction is to set out and mobilise the bottom half to forcibly take the wealth from the top ten percent and set up a new social system.

Extreme? Maybe. Undemocratic? Not really.

Academic at the moment; no parliamentary wannabe is going to argue radical redistribution – let alone expropriation – as a solution to the growing cancer of poverty in Aotearoa.

What they do instead is bang on forever about one select part of it, Child Poverty.  On the face of it, this seems an eminently right and compassionate thing to do. Because, unlike adults, children have no choice about their economic status. Children’s mission is to grow their bodies and minds and secure some of the ever-increasing educational qualifications that modern employment demands. Adults can go out and earn some money right now.

So the acceptable argument in political circles is not about eradicating poverty or, god help us, eradicating high individual wealth. Instead, back and forth the debate rages about raising the greatest number of children out of poverty.

For the comfortable top section of New Zealand society, the Child Poverty approach has two big advantages.

It covers over the fact that thousands of workers don’t get paid enough with the notion that kids suffer because their parents are too shiftless or selfish to provide for their families. The phrase ‘lifting children out of poverty’ conjours up a sunny image of kids being physically removed from squalor, from a squalid home or neighbourhood. Much less dangerous than ‘replacing poverty with equal shares for all’.

The other advantage of reducing poverty to Child Poverty is that the setting is not about creating social equity but entirely about helping children – the most vulnerable.

The word ‘vulnerable’ has been ludicrously overworked in recent years, for good reason. It sounds like sympathy for the poor, but it’s a bosses’ concept. To be vulnerable is to be conveniently malleable. ‘Vulnerable workers’ are to be pitied and, within reason and where budget allows, sensibly assisted. ‘Vulnerable workers’ do not organise and seize back the wealth they created; they are fortuitously and permanently supplicants. The politics of ‘vulnerable victims’ leaves all the power firmly in the hands of the established order.

As the election campaign rolls on, National and Labour and the rest of them show their essential identity by debating within the same safe parameters; whoever wins, nothing substantial will change.

From here, today, it looks a long way off, but the only real solution to child poverty is ending poverty per se, through the forcible dispossession of our parasitic and hypocritical ten per cent.

Further reading:
How capitalism works – and doesn’t work  
What is exploitation 




  1. Excellent analysis, and right in line with the approach taken by CPAG: Child Poverty Action Group. Of course we know that it’s families in poverty, and the grossly inadequate social payments that are eked out to the people shut out from any kind of work. We in NZ appear to have taken on attitudes towards beneficiaries that come straight out of the American songbook. The change in the name of Child, Youth and Family to Vulnerable Children is descriptive of the path that this Govt is following in denigrating parents, while removing children to be fostered in “loving homes”. This is not just bull-shit it’s the real pongy stuff. And the major sufferers in this latest round of colonization are the children themselves.

    So the Marxist solution to take over the duties of the State, as you so rightly say, is not open to us at this time. I guess I need to check in with the Autonomous lot, and see what they have to say on the matter.

  2. Well, the approach of the fifth Labour government was to keep in place the sweeping cuts in welfare payments made in the “mother of all budgets” by National at the start of the 1990s. And the fifth Labour government had year after year of budget surpluses so, even within the constraints of capitalism, they could have substantially eased the burden on beneficiaries – but Helen Clark and her cohorts decided not to.

    Instead they brought in ‘Working for Families’, which helped employers maintain low wages and made a dividing line between the “deserving poor” (those with jobs) and the “undeserving poor” (those without jobs).

    Under Clark’s government the super-rich got even more rich at a faster rate than they did under the previous National government.

    So it has ended up being National that has raised social welfare benefits.

    Labour is dedicated not only to managing capitalism – the system responsible for the poverty – but also managing it in a fairly parsimonious way. “Fiscal responsibility” rules.

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