HOW MUCH POVERTY CAN A SOCIETY ENDURE?

Prof. Christoph Butterwegge on Current German Income Support Laws

[This interview published in: Neues Deutschland, 8/21/2006 is translated from the German on the World Wide Web, www.nd-online.de/funkprint.asp=.] Prof. Christoph Butterwegge, born in 1951 in Albersloh/Westfalen, directs the political science division at the University of Koln. His last books are titled: The Crisis and Future of the Welfare State, 2005 and Child Poverty in East and West Germany, 2005.]

ND: Mr. Butterwegge, a reform of the so-called Hartz law (combing unemployment and income support) took effect on August 1, 2006. The central point is putting the screws on the long-term unemployed and minimizing spending. What do you think of this?

Butterwegge: Nothing at all. Unemployment is not reduced. The unemployed are combated. Their life is made more difficult. Poverty increases and becomes the norm all over society. The social climate deteriorates – with more mistrust and control and less liberality and democracy.

ND: There could be moaning on a high level in Germany. Nobody actually starves to death here. What does it mean to be poor in Germany?

Butterwegge: Being poor in Germany is obviously different than being poor in Mozambique. But whoever thinks enduring poverty in Germany is easy trivializes reality. Poverty in a rich country can be even more oppressive and depressing especially for children and youths than where hardly anyone has money. In a well-to-do land like Germany, there is more pressure – to wear brand-name clothing, to have the latest cell phone and to keep pace with playmates on the highest consumer level.

ND: Could one speak of “existential poverty”?

Butterwegge: Yes and no. Objective poverty exists as well as a subjectively experienced poverty. From January 1, 2007, whoever turns down three offers for a 1-Euro job will be denied all payments including housing subsidies. He will have to resign to vouchers, for example for shopping in food stores. In a society so intensely fixated on money as our society, persons who have little feel poor and are also cut off from possibilities of cultural participation. When one collects unemployment benefits II or income support, one cannot go to the latest film or to the theater. Optimally developing personality becomes impossible. Development chances for children and youth are whittled down.

ND: While many beautiful words are spoken about freedom, nothing in the world makes people so unfree as poverty (Martin Anderson Nexo).

Butterwegge: Therefore emphasizing “participatory justice” and not distributive justice today is a perversion of the discussion. This happens at a time when money is more important than ever in nearly all areas of life if one wants to participate in social processes and money is distributed more unequally than ever. Making distributive justice the basic presupposition for the participation of all people is the core task of leftist politics. This is more necessary than ever. Otherwise the division of society will deepen even more.

ND: You say money was never so important as today. Why is this?

Butterwegge: Here is one example. My mother put all my child photos in a photo album. In 1960, I posed as a nine-year old in a swimming suit at an outdoor swimming pool in Schwarzwald. My admission ticket with the printed price – ten cents – was attacked next to this photo. At that time, swimming pools in West Germany and East Germany were publically subsidized. Parents who take their children to a private swimming pool today know very well that a few cents is not enough any more for the leisure fun.

Here is another example. From my perspective, poverty is too strongly reduced to educational poverty as though education were a political wonder weapon in the battle against child poverty. Children and youth must obviously receive a good education and training. But if someone wants to keep pace in this area, he needs money for private lessons for his children or for retraining possibilities. More and more areas of society are economized, privatized and commercialized. These areas are only open to persons with the necessary small change.

ND: What has caused this?

Butterwegge: Mainly the sweeping success of a concept that changes society into a huge market. When lobbyists and neoliberals hiding behind their powerful interest groups act as though justice were possible with growing inequality, that is pure ideology. Conversely, distributive justice is the key for a peaceful future. Education can be a way to individual ascent but is not a social royal way out of poverty. If all people were suddenly better educated, more and better-educated persons would compete for non-existing jobs. There would be more taxi-drivers with doctorates but poverty would not be defeated.

ND: You speak about benefit cuts that threaten when so-called reasonable work is refused. However the fact is that many people have lost their job through no fault of their own, are often jobless for a long time and have long lived with the feeling of devaluation. Work cannot be expected of them any more. Isn’t the community caring for them a simple inescapable fact?

Butterwegge: The welfare state is obligated to care for all needy persons, not only when sweeping the park for a Euro an hour brings a return favor.

ND: Where is that written?

Butterwegge: Articles 20 and 28 of the constitution say: The Federal Republic of Germany is a social constitutional state. The constitution does not say Germany must be a welfare state when “economic location Germany” is helped or the benefit recipient brings an equivalent or return favor. “Performance justice” replaces the need justice that constitutes every welfare state. Who defines performance and how performance is defined are unclear.

ND: We always hear the welfare state cannot be financed any more and will never be financed.

Butterwegge: That is one of many lies and legends invented to dismantle the welfare state without the energetic protest of its citizens. In reality, Germany is richer than ever. However the socially gained wealth is distributed extremely unequally. A few become richer and richer and the others poorer and poorer while the poor become increasingly numerous. While the Albrecht brothers, owners of the north and south Aldi chain have private assets of over 30.6 billion euro according to the US business magazine Forbes, 2.5 million children live below the income support level. The gulf within a society could hardly be greater. The concentration of wealth increases even more while the poverty spreads in our society.

Whether and to what extent the land does justice to its welfare state obligation is reflected in the share of social benefits, the portion of the gross domestic product spent for social necessities. The social benefit rate today as in the old Germany in 1975 amounts to around 33.3 percent. Thirty years ago there were “only” a million unemployed in Germany. Now the numbers fluctuate between four and five million.

Although the social problems have increased enormously on account of the employment crisis and German unification, the share of socially produced wealth spent for the welfare state has not grown. Thus the feeling that the welfare state extends like an octopus over society, that money “is liberally thrown out the window” and that the economy is overwhelmed is false or, more exactly, artificially produced by politicians, parties and the media. A larger part of the national income flows into profits while gross wages fall. Wages have risen more slowly in Germany than in the other 24 European Union states.

ND: Couldn‘t the state charge businesses that record enormous profits while dismissing workers to compensate these persons so they can live in dignity?

Butterwegge: There is a union demand for a termination prohibition when a corporation – like Telecom and Allianz – make gigantic profits on one side and destroy thousands of jobs on the other. Similar regulations already exist n other countries like France. Mass layoffs are not as simple there as in Germany. In Germany, the political will is lacking. The great coalition wants to make work cheaper and workers more flexible while raising the cost of living.

ND: Did you withdraw from the SPD on account of the great coalition?
Butterwegge: Yes, I feared in the fall of 2005 that the great coalition would continue and intensify the red-green course of social dismantling as in Agenda 2010 and Hartz IV. I see my negative judgment at that time completely confirmed. If the Merkel/Muntefering government raises the profits tax at the beginning of 2007, large families of low- and normal earners will be greatly burdened. They must count every euro and every cent and stick their whole income in daily consumption. Conversely the champagne corks on New Years Eve will pop even louder than before for the super-rich.

The generous coalition of the CDU/CSU and the SPD is giving a considerable Christmas gift to the children of millionaires and billionaires. On January 1, 2007, the inheritance tax will also be waived the heirs of firms if the businesses fulfill certain conditions for ten years. In other words, there will be more poverty on one side and more wealth, wealth by law, on the other. The social division will intensify instead of being deactivated.

ND: How much poverty can a society afford without becoming unstable?

Butterwegge: With an Americanization of the welfare state, one lands in the Americanization of the social structure and slums. There will probably be more drug abuse, violence and criminality. The prisons already burst at the seams. Perhaps the rebellion of socially disadvantaged youth will occur as in the French satellite towns. The deepening gulf between poor and rich will inevitably have consequences for the social cohesion. No well-to-do person really lives well and without fear when he cannot leave his home in the evening without a bodyguard.

ND: You do your utmost not to intensify the social division. How is that possible?

Butterwegge: I urge an inheritance tax reform, for example, that skims off more from the enormous wealth. The property tax abolished in 1997 under Helmut Kohl could be levied again. The state in the future would collect dozens of millions more euros to finance public employment programs. A legal minimum wage to reduce poverty in the low-wage sector and revive the domestic economy would also be sensible.

ND: Still the cry is heard: This is impossible in the age of globalization. The location cannot be damaged!

Butterwegge: We do not live on an island of the blessed in New Guinea or on the North Pole. Rather Germany is economically and politically the second most powerful country of the world. If this government resolves a change of course, it could realize this in the EU and at the G8 meetings. Massive resistence surely exists here and there. That the attempt is not made upsets me. Whoever does not make the effort to change the policy of social division can hardly avoid saying this is impossible.