The Poor Laws in England and the US today

editor’s note: This is political/economic and not related to sports. Feel free to skip it. You’ve been warned.

“By the turn of the century — and especially following the end of the French Wars in 1815 — the cost of relieving the poor in England was considered by most contemporaries to be unsustainable. The Elizabethan poor laws, whose original focus was the aged, the sick and the infirm, were now being used wholesale not only to feed the chronically un- and under-employed, but also as a way of supplementing the inadequate wages of the workforce.”—Last week while reading some secondary literature on poverty in nineteenth century England, I stumbled across this interesting summary from Peter Jones writing “Clothing the Poor in Early-Nineteenth-Century England” in Textile History 37, no. 1 (May 2006): 17-37.

It reminded me of George Will’s column from early in February about the deficit and America’s future demographic problem. Will examined the growing cost of healthcare (much of it funded by entitlements) and another issue that could threaten national security—the rise of China. Will outlined an argument that believes more people living longer means more demand for healthcare that becomes more expensive the longer people live. This creates a “demographic destiny (that) might entail starving every other sector of society — including national defense, at great cost to America’s international standing.”

And he couples this with the rise of China. According to Will, Robert Fogel “expects that by 2040 China’s GDP will be $123 trillion, or three times the entire world’s economic output in 2000. He says China’s per capita income will be more than double what is forecast for the European Union. China’s 40 percent share of global GDP will be almost triple that of the United States’ 14 percent.” (You can read more about that at Foreign Policy.)

Some skepticism seems to be in order. I’m bullish on China for a number of reasons including no capital gains tax and a better understanding of fiscal policy than the U.S. Congress—it is no secret that the Chinese are better capitalists than what we have in Washington today. I continue to invest in China via stocks. However, China faces its own demographic hurdles. Anyone remember Japan? In the late 1980s Japan was going to rule the world. But Minxin Pei (also in Foreign Policy July/Aug 2009) pointed out “Aging is a principal cause of Japan’s stagnation.” Pei continued, “China’s elderly population will soar in the middle of the next decade. Its savings rate will fall while healthcare and pension costs explode.” Pei outlined other serious obstacles to continued Asian growth ranging from water shortages to political instability. With obstacles there, it seems prudent to expect some corrections in China—there will be setbacks to the rapid growth.

But Will and Fogel are right. America is facing a demographic crisis. It isn’t as bad as Europe because of the better fertility rate in the U.S. and immigration. (Immigration is a topic for another day because it presents lots of negatives and lots of positives.) However, the entitlement costs continue to grow and there is no way to view it other than as a threat to national security.

But this brings us back to England in the nineteenth century. The Old Poor Law of 1601 passed under the reign of Elizabeth placed a tax on property with the proceeds being administered by the local parish for the benefit of the poor. Taxpayers at the parish elected a board of overseers to administer the law. However, by the nineteenth century the poor law had created a wave of issues, and as Jones noted it was felt “the cost of relieving the poor in England was considered by most contemporaries to be unsustainable.” One of the reasons identified was the expansion of this program beyond its original scope. Again, as Jones pointed out what was supposed to help the aged, the sick and infirm had become much more. It sure looks similar to many entitlement programs today. And that isn’t to condemn the Old Poor Law or modern entitlements, but to put into context that programs like Social Security today are nothing like the safety net once envisioned.

What is most worrisome is that everyone wants to help the poor. However, the demographic pressures, growing deficits and national security threats make doing so much more difficult in the future. Will the U.S. face the same decision England faced in 1834 when it passed the New Poor Law?

Will reform come and what will it look like?

14 Responses to “The Poor Laws in England and the US today” Subscribe

  1. alex hamilton February 24, 2010 at 12:15 pm #

    So, what is your position on the SSA?

  2. capstonereport February 24, 2010 at 12:25 pm #

    We are stuck with it. We have to fix it. Again Will had a few interesting links to policy solutions including partial privatization for those under 50.

    Any approach to fix the entitlement problem has to grow the economy, protect retirees, protect those close to retirement and end the pyramid scheme nature of these social programs.

    The economist Will quoted from Foreign Policy also mentioned the demographic issues. We need YOUNG workers to fund those heading to retirement.

    One lesson we won’t consider, but was an essential element of the Old and New Poor Laws in Britain was the requirement that families take care of close relations who were poor. The parish would provide additional aid if beyond the families means, and often complete aid. What once were filial obligations are now social obligations. I don’t think this is sustainable.

  3. John February 24, 2010 at 12:36 pm #

    First, one must recognize that he who fails to heed the lessons of history is doomed to repeat it. In other words, we, as a nation, have ignored the history of democracy and thus we are in the same death spiral that has claimed every democracy since Athens around 500 BC.

    Loose fiscal policy has been, and continues to be the Achilles’ Heel for democracy. We just can’t stop electing people who promise us the world either through tax cuts or through expansive “Programs” to improve our lives.

    I must say that I am pretty certain that it is too late for America to abandon the course we are on. Quite simply, we crossed the tipping point about five or six years ago (the point of no return).

    Conventional political leadership is helpless to resolve the issue. In order to save us from ourselves, we have no choice but to elect a truly radical reformer who will essentially scrap democracy by enlisting military support to elevate the power of the Executive Branch.

    Don’t loose faith though, ’cause once the proverbial shit hits the fan, faith is all you’ll have…

  4. John February 24, 2010 at 12:49 pm #

    As for the poor, well, when our governments policies continue to shift jobs overseas, when it’s policies continue to concentrate wealth in the hands of but a few (yes, 2% of the population constitutes a “few”), when the gulf between the richest and the rest of us continues to widen, then the ranks of the poor swell.

    Here’s how to fix the problem, though no politician will ever attempt this –
    - Institute compulsory public service via a modified draft where both male & female citizens ages 18 – 25 are subject to service. Service would include an array of military & non-military public service positions. Oh, and this also means that the current career civil servant would be history. Clean house via retirement, early retirement, & other tactics to force sub-par performers out.
    - Institute tariffs on imported goods coming from countries with inadequate worker safety & environmental safety laws. This alone would serve to level the playing field for manufacturing in America.
    - Across the board cuts of 10% per annum on federal spending for each of the next 5 years. All departments, including defense. No area exempted. Every government agency must reduce spending. period. 5 years & 10% each year from the year before will have spending to a level, in 2015 that is about 59% of current spending and that would lead to some serious debt reduction.

    Just my pie-in-the-sky thinking…

  5. Big red A February 24, 2010 at 12:59 pm #

    When we get piled
    upon one another in large cities, as in Europe,
    we shall become as corrupt as Europe .

    Thomas Jefferson

    The democracy will cease to exist
    when you take away from those
    who are willing to work and give to those who would not.

    Thomas Jefferson

    It is incumbent on every
    generation to pay its own debts as it goes.
    A principle which if acted on would save
    one-half the wars of the world.

    Thomas Jefferson

    I predict future happiness for
    Americans if they can prevent the government
    from wasting the labors of the people under the
    pretense of taking care of them.

    Thomas Jefferson

    My reading of history convinces me
    that most bad government results from too much
    government.

    Thomas Jefferson

    No free man shall ever be debarred
    the use of arms.

    Thomas Jefferson

    The strongest reason for the
    people to retain the right to keep and bear arms
    is, as a last resort, to protect themselves
    against tyranny in government.

    Thomas Jefferson

    The tree of liberty must be
    refreshed from time to time with the blood of
    patriots and tyrants.

    Thomas Jefferson

    To compel a man to subsidize with
    his taxes the propagation of ideas which he
    disbelieves and abhors is sinful and tyrannical.

    Thomas Jefferson

    Thomas Jefferson said in
    1802
    :

    ‘I believe that
    banking institutions are more dangerous to
    our liberties than standing armies.

    If the American people ever allow
    private banks to control the issue of their
    currency, first by inflation,

    then by
    deflation, the banks and corporations that will
    grow up around the banks will deprive the people
    of all property -

    until their children
    wake-up homeless on the continent their fathers
    conquered.’

    I WISH WE COULD GET THIS OUT TO EVERYONE!!!

    When we get piled
    upon one another in large cities, as in Europe,
    we shall become as corrupt as Europe .

    Thomas Jefferson

    The democracy will cease to exist
    when you take away from those
    who are willing to work and give to those who would not.

    Thomas Jefferson

    It is incumbent on every
    generation to pay its own debts as it goes.
    A principle which if acted on would save
    one-half the wars of the world.

    Thomas Jefferson

    I predict future happiness for
    Americans if they can prevent the government
    from wasting the labors of the people under the
    pretense of taking care of them.

    Thomas Jefferson

    My reading of history convinces me
    that most bad government results from too much
    government.

    Thomas Jefferson

    No free man shall ever be debarred
    the use of arms.

    Thomas Jefferson

    The strongest reason for the
    people to retain the right to keep and bear arms
    is, as a last resort, to protect themselves
    against tyranny in government.

    Thomas Jefferson

    The tree of liberty must be
    refreshed from time to time with the blood of
    patriots and tyrants.

    Thomas Jefferson

    To compel a man to subsidize with
    his taxes the propagation of ideas which he
    disbelieves and abhors is sinful and tyrannical.

    Thomas Jefferson

    Thomas Jefferson said in
    1802
    :

    ‘I believe that
    banking institutions are more dangerous to
    our liberties than standing armies.

    If the American people ever allow
    private banks to control the issue of their
    currency, first by inflation,

    then by
    deflation, the banks and corporations that will
    grow up around the banks will deprive the people
    of all property -

    until their children
    wake-up homeless on the continent their fathers
    conquered.’

    I WISH WE COULD GET THIS OUT TO EVERYONE!!!

  6. Big red A February 24, 2010 at 1:02 pm #

    Sorry, my impatience caused me to post these quotes twice, but they are disturbingly accurate to the current ideals of the current administration.

  7. FINEBAMMER February 24, 2010 at 4:53 pm #

    evrything was going swimmingly then somebody showed up quoting that damnable slave owner.

    shit.

    (sarc/off)

  8. jgo February 24, 2010 at 5:20 pm #

    Yep, fix the Socialist Insecurity Abomination the way way we fix cats and dogs. Chop it off.

  9. Pluto February 24, 2010 at 6:07 pm #

    We have been buying the Peace since the 60′s – especially 1968 – Great Society – Welfare – the Oligarchs that run this Country have been trying to control a Civil War that has been smoldering for 40 years….

  10. alex hamilton February 26, 2010 at 12:07 am #

    I think that Social Security is fine as a program. The elderly and infirm should have a “floor” of basic living. The issue that needs to be redressed is that the infirm must be actually disabled before being awarded benefits.

    Also, we need to raise the retirement age to 70. As the population ages, the retirement age needs to be raised.

    • shak el August 21, 2011 at 10:50 am #

      Workers are more productive now and with more an more automation will be needed less to make more. Reduce the retirement age to 50-55 based on industry. This will make more jobs available to the young who are more productive. Create a maximum income level.

  11. Big red A March 4, 2010 at 12:14 pm #

    Thomas Jefferson was indeed a slaveowner, but that doesn’t change the fact that he also believed in small govt. We as people have to listen to all of our ancestors, good and bad to learn the proper lessons to continue in a positive manner. We are where we are now because we have not heeded the warnings.

    • shak el August 21, 2011 at 10:47 am #

      Jefferson in his later years supported the idea of “ward republicanism” and ward based relief for the poor.

  12. shak el August 21, 2011 at 10:45 am #

    Lift the cap on social security taxes
    create jobs by lowering retirement age in certain fields like contruction to 50 (most construction workers are leaving work via disability by that age anyways and this would streamline the process and save money by avioding costly appeals).
    End free trade
    Set up a new small businesses/workers cooperative bank funded by an annual 10% tax on corporate capital that just sits in banks or bonds (capital invested in new plants and wages exempt)
    Change in corporate law to reflect the interests of its workers and community on its boards (33% workers reps, 33% community/government, and 34% investors)

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