Wednesday, 3 December 2014

The first rule of Immigration Club

You don't have to be the sharpest tool in the box to realise that the oppressed Ukip martyr's whine of "we're not allowed to talk about immigration, because political correctness," is bullshit, now that any fool with ears can hear the non-stop cacophony of high-profile politicians competing to out-brag each other about how tough they'd be on migrants. If you think the subject's being ignored, you just haven't been paying attention. A small club of noisy, professional immigration bores now dominates the discussion monologue.

The first rule of Immigration Club is: You do not stop talking about Immigration Club.

Since we're now not allowed not to talk about immigration, is there anything new or interesting to be said? Well, things did recently get quite interesting with the hint of a possible, partial solution to the seeming paradox of Schrödinger’s Immigrant. Just as Schrödinger’s Cat exists in a state of being both alive and dead at the same time, Schrödinger’s immigrant exists in a state of both lazing around on benefits whilst simultaneously being out there stealing British jobs.

There's still no convincing solution to the paradox in terms of a general theory of immigration. Theoretically, foreign migrants might be differentially better at blagging their way onto benefits to which they're not entitled than their British-born peers, or more skillful at optimising their work shift patterns to accommodate regular signing on, or getting their mates to sign on in their place, or some other fiddle.

But I'm not aware of any actual evidence to back up this hypothesis, (the Department of Work and Pensions' own figures don't seem to back it up), nor does it seem likely that newcomers for whom English is a second language would be any better at outwitting the UK's institutionally sceptical benefits bureaucracy than native English speakers who've had a lifetime's experience of UK institutions. And, given that fraud accounts for about one per cent of the total annual benefits and tax credits spend (probably less than a fifth of the cost of benefits which people are entitled to, but which go unclaimed), it seems that neither Brits nor migrants are much good at gaming the system, anyway.

But, in terms of the special theory of immigration (that's EU immigration to you), there's a possible solution to the paradox. You can be both in work and claiming benefits if they're the sort of  in-work benefits some politicians are now keen to stop EU migrants getting. An EU migrant worker or self-employed person who's here legally and has passed the EU's "habitual residence test" and the controversial, additional "right to reside" test imposed by the UK government, could be entitled to some in-work benefits, thus becoming that oxymoronic demon of the Ukip imagination, the benefit-scrounger-cum-job-stealer.

Of course, a cohort of low-paid people who are working here legally and have passed the appropriate residency tests getting their wages topped up, just like low-paid Brits, hardly adds up to the shocking blank cheques for illegal foreign scroungers conjured up by Daily Mail migrant scare headlines, but maybe in-work benefits might be a problem, with some element of unfairness in terms of people who haven't contributed gaining a benefit, or with people being incentivised to take low-paid jobs that might otherwise go to British nationals.

For contributory benefits, like Contributory Job Seekers' Allowance and Incapacity Benefit, the problem is self-limiting - if you haven't contributed, you can't claim. No problem. But there are quite a few non-contributory benefits  which might be acting as a draw.

If it is a problem, how big is it? Anoosh Chakelian in the Staggers gives some perspective:
The latest DWP figures from 2014 show that there are 1.73m EU nationals working in the UK, equal to 5.7 per cent of all people in work... ...Less than 5 per cent of EU migrants are claiming Jobseekers’ Allowance, while less than 10 per cent are claiming other DWP working-age benefits.
So we're talking about approximately 173,000 Schrödinger’s immigrants. Or less than half a per cent of the UK's working-age population of something like 38 million. Even if the draw of in-work benefits is a problem (and if it is, does it outweigh the economic benefit of those people coming here, working, spending and paying taxes?), it's clearly not a very big one.

But maybe , even if it's not a big problem, it's a a matter of fundamental unfairness - a few of them can come here and claim in-work benefits, but we can't go there and do the same. Well, it seems to be a bit more complicated than that:
Is the UK benefits system more generous than those in other EU countries?

The systems are very diverse, so comparisons are difficult.

In terms of total spending on social security per inhabitant, the UK does not rank highest...

 ...In the UK, a bigger portion of welfare is funded by the state than is the case in Poland, France, Germany or the Netherlands. In those countries, more is funded from individual and employer contributions. In other words, more benefits are linked to previous earnings.

On the other hand, in several countries, including the Republic of Ireland, Sweden and Denmark, the share of state funding is higher than in the UK.

In Germany, there is a two-tier welfare system - part based on contributions, part non-contributory. An EU migrant made jobless in Germany would get up to 70% of current salary in the first year of unemployment. After that, the unemployed go onto a non-contributory system called Hartz IV. Germany has objected to paying those benefits to EU migrants who have not made sufficient contributions through work. But that policy has been challenged in the courts.

 In Spain, welfare payments depend to a large extent on where you live as payments are handled regionally, rather than centrally. In Madrid there is a two-year residency test for RMI, which is paid to unemployed jobseekers. The benefits system in the Basque Country is rather less restrictive.

In Bulgaria, the EU's poorest country, you do not qualify for unemployment benefit unless you have been working for at least nine of the last 15 months.
BBC News Q & A

It's interestingly counter- intuitive that we Anglo-Saxon free marketeers have a more statist approach to welfare than those bastions of the European social model, France, Germany and the Netherlands. Which, in turn, raises another interesting question.

Conventional wisdom has it that, even stripping out the effects of the the catastrophically mismanaged Euro, we in Britain enjoy a lower unemployment rate than the European average because of our "free market" "flexible" approach to labour.  Or is part of our relatively low unemployment down to the unacknowledged effect of our decidedly un-free market decision to provide state subsidies for low-wage jobs that wouldn't be viable for either employers or employees in an actual free market? I don't know the answer and there are other factors in play (such as wages being supplemented via the unarguably free market mechanism of piling on household debt, which has quadrupled since 1990), but it's an interesting possibility that behind the curtain of all that free market rhetoric may sit a Central Planning Wizard.

Could Iain Duncan Smith be the hapless Wizard of Oz, frantically pulling the levers which maintain the illusion of a flexible labour market, built on free market principles? Could that rough beast, Universal Credit, currently slouching towards Manchester to be born, mark the nativity of a conservative project to keep the ailing free market alive with the life-support of a Citizens' Basic Income?

And talking of free markets paradoxes, what's with these these Thatcherite free-marketeers objecting to the free movement of labour? "We voted for a free trade area, not a political union, " they complain, but it's not much of a free trade area when people who want to move around it to work are being held back by barriers of red tape being thrown up by bureaucrats at the behest of "small-state, free market " politicians.

So the subject does throw up a few interesting surprises, complexities and paradoxes. These might not not get us very far, but they make a change from yet another iteration of the simple, stupid solutions to non-problems that are all members of the Immigration Club ever want to talk about.

My working hypothesis is that they're  deliberately bullshitting in order to crowd more important issues off the agenda - like, for example, the National Health Service (whether or not Nigel Farage secretly wants to privatise it, his health policy shows all the signs of having been made up on the back of one of his fag packets, during one those rare five minutes he spends not blaming foreigners for everything). Or the tax evaders and avoiders, who game around £32 billion out of the system, by the HMRC's own conservative estimate, an exclusive scroungers' club which Nigel was rather keen to join at one point. Sadly for Nige, he flunked his membership application because, despite having been tutored in the City of London, the world's tax avoidance capital, he was too dumb to set up his own offshore tax-avoidance scheme properly.

Immigration Club may generate a lot of noise, but they're basically all mouth and unfortunate trousers. Or, like Mr Shakespeare said:
...It is a tale.
Told by an idiot, full of sound and fury,
Signifying nothing.
Anyway, that's more enough of taking Immigration Club seriously, so it's time to end by winding its members up with a bit of cognitive dissonance. Remember when the the pro-Ukip Nick Griffin's British National Party fell flat on its serially incompetent collective face by trying to evoke our pre-immigration Finest Hour with a picture of a Spitfire of 303 (Polish) Squadron on one of its anti-immigration posters, when as any fule kno, their fellow fascists flew Stukas and things (unsurprisingly, xenophobes and Polish aeroplanes don't mix very well)? I'm indebted to Czech Economist, Tomáš Prouza for adding a Hurricane to our Battle of Britain collection, by tweeting a topical reminder of how Czech migrants, whose papers may well not have been in order, along with a bunch of Poles, helped the the Brits to kick Reichsmarschall Göring's arse: