The Archbishop of Canterbury is an Economically Illiterate Statist

The letter to the Daily Telegraph signed by 43 Anglican Bishops and endorsed by Justin Welby, the incoming Archbishop of Canterbury, is a weak cocktail of emotional appeals, vacuous half-truths and the flagrant abuse of statistics.

Written in opposition to the government’s proposed 1% cap on the annual rise in benefit payments, the Bishop’s letter opens with the “think-of-the-children” gambit, a maneuver typically deployed by people with no actual argument, saying,

“This is a change that will have a deeply disproportionate impact on families with children, pushing 200,000 children into poverty. A third of all households will be affected by the Bill, but nearly nine out of 10 families with children will be hit.”

This claim relies on the use of a relative measure of poverty, whereby a household is considered to be “in poverty” if its income is below 60% of the median household level. This is, of course, totally arbitrary and completely perverse, as it requires us to consider other peoples misfortune to be analogous to our own success. The MP Frank Field, himself an Anglican, said in 2010,

Any candidate sitting GCSE maths should be able to explain that raising everybody above a set percentage of median income is rather like asking a cat to catch its own tail. As families are raised above the target level of income, the median point itself rises. Not surprisingly, therefore, no country in the free world has managed to achieve this objective, not even in those Scandinavian countries whose social models many of us admire.”

If a Labour MP for a Merseyside constituency is able to articulate this obvious fact then why can’t the Church grasp it? And besides, the problem of child poverty, to the minimal extent it actually exists in Britain, is completely tractable at nearly zero cost: if you can’t afford to keep a kid wear a prophylactic sheath!

Of course leftists love to prate about income inequality, usually segueing artlessly into rants about “banksters”, “the 1%” and “Old-Etonians”, and this occasion is obviously no exception. The top rated comment on the Guardians article, Benefits changes will push children into poverty, says archbishop of Canterbury reads,

They cap increases at 1% but urge no cap on bankers bonuses…….sickening.”

In reality the idea that Britain suffers unduly from income inequality is fatuous drivel, and nothing more than a vulgar outpouring of childish jealousy. The UK’s GINI coefficient, (a statistical measure of income distribution) is low by world standards, as illustrated in the map below. Notice also that lands of Socialist loveliness such as Cuba and Venezuela are coloured in dark red, representing greater income inequality than in coteries of capitalist iniquity such as the UK. No surprises there of course!

World Gini Coefficients (2009)

Perhaps even more vexatious than the Bishop’s nonsensical stance on poverty — which can be written off as an attempt to curry favour with the proles — is their undergirding statist philosophy. (Although it should come as no surprise that men who are paid to pretend that they can communicate with the creator of the Universe favour big government). In a statement from Lambeth Palace Justin Welby said,

These changes will mean it is children and families who will pay the price for high inflation, rather than the Government.”

I would love to know how the Archbishop to be thinks the government can pay for anything, through inflation or otherwise. The government’s only sources of funding are confiscatory taxation, borrowing and the exploitation of state monopolies. Are we to believe that people would pay tax voluntarily, en-masse? Or that the NHS could turn a profit? That’s a wackier idea than virginal conception if you ask me!

Mr Welby and his colleagues would be well advised to take heed of Margaret Thatcher, who told the Conservative party conference in 1983, “There is no such thing as Public money”. Whilst I am well aware that some might not be amenable to Mrs T’s opinions, it matters not. A long time ago there was this bloke called Jesus, mayhap the Bishops haven’t heard of him, who might have sympathised with Mrs Thatcher’s view:

“And Jesus said unto them, Render unto Caesar the things that are Caesar’s, and unto God the things that are God’s. And they marvelled greatly at him.” [Mark 12:17; English revised version]

This is the most important piece of Biblical scripture pertaining to political economy (although that may be damning with faint praise), as it alludes to an important truth: the role of the state should be limited. A big, extensive government will inevitably distort the business cycle, create perverse incentives, pander to special interests, entrench class divisions and basically cock up everything it touches, regardless of the colour of its’ rosette. And whilst Jesus would not have been in favour of outright tax rebellion or a fan of anarcho-capitalism, I am without doubt that today far too much is being “rendered unto Caesar”. Even with the government’s austerity drive, which is largely imaginary, State spending will account for over 40% of GDP by 2015.

For the sake of comparison, government final consumption expenditure is at 22% of GDP in the UK and 13% of GDP in China [1]. Which makes good Old Blighty (or Perfidious Albion if you prefer) about 69% more Communist that “Communist” China!

Jesus: a man with Thatcherite leanings ?

Jesus: a man with Thatcherite leanings ?

Hence we shouldn’t conclude that the proposed reforms cut spending too much, especially because they fail to address the cost of state pensions which represent the largest tranche of the welfare budget. Rather, that they’re nothing but a piecemeal attempt to woo support from Social Conservatives who are anti-welfare and Classical Liberals who may be tricked into thinking that the Tories are advocates of a small state. Of course they’re neither, which should please the Bishops and Justin Welby.

Caesar has no clothes!


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