| The normalisaton of debt has many consequences. What those are is not a matter of objective fact, for we don't have enough information. But perceptions of those consequences has real and quite profound effects. For example, for some of the hard right those consequences were seen to be political, and there was the rather disgusting episode of Dame Shirley Porter and Westminster council. It was Shirley Porter's belief that house ownership was a direct route to support for the Tory party, and so she gerrymandered the wards in the Westminster local authority area in order to remove people more likely to vote for opposition parties. This was quite deliberate and wholly illegal. But what Porter did was an extension of what the Thatcher government also did deliberately: Porter just omitted to change the law to make her actions fall within it. I suppose she saw that as "red tape", and that too was part of the mantra of the right:most law and regulation had no other function than to hamper enterprise, in their view: and so they pursued deregulation avidly. Porter is possibly the best example we have in this country of the profoundly undemocratic outlook which underpins this ideological movement. It is possible to argue that she was atypical: but while most of the right would say that the project must proceed according to law, all that means is that law must conform to the project's requirements. They observe the niceties to some extent: and it is not trivial that they see a need for winning election before they can implement policies. But we have a FPTP system: they need not tell the electorate what they are going to do on these issues: they can win by talking about something else.
By the end of the 80's there had been a huge expansion in personal debt. Although it was accompanied by a shift in attitudes which let people live with the burden it is perfectly clear that the change was not quite as presented. People still dreamed of a debt free life. The only way that ordinary people could achieve that was to make money which would clear that debt. And the only source of wealth was, again, the house. Gradually a house changed from being somewhere to live: it became an "investment". Similarly, and as we have also discussed, education changed its character: it moved from being a good in itself into being a route to higher income. As the costs of housing the population were shifted from the group to the individuals, so the costs of educating them at the higher levels were also exported. During the 1970's students were paid to go to university: although there had been an expansion in the numbers of places in the 1960's and 1970's the costs of higher education remained with the state, very largely. Maintenance grants were means tested, certainly: but tuition was free for all, and a grant for books was automatic, even for the wealthiest. Access was restricted by the relatively small number of places. As with consumer credit, it was rationed.
Education at that time was seen as a public good. There was a certain naivety in that, but it was not different from the attitude to apprenticeships. Ordinary people made choices to sacrifice income early in life for a premium wage after they gained qualifications, whether those be a journeyman's ticket or a degree. The society benefitted from those choices by having a proportion of well educated people: and companies benefitted from a pool of skilled worker. Viewed in this way it is logical that companies paid for apprentices' education: and the state paid for students. Companies directed the flow of technical education according to their needs: but the needs of the wider society were less direct and predictable: so there was no attempt to direct students into particular fields of study. Very little was vocational: the professions were: but for many education was seen to have a worth in itself and vocational training was expected to be provided by the employer, once the student secured a job.
As plutocratic values became dominant that changed. Emphasis was placed on the wage premium of a degree, and from a social good it was recharacterised as a private benefit: it followed that the person gaining that benefit should pay the costs of acquiring it. And so it came about that the student should pay the state rather than the other way around. It is utterly astonishing to me that people were led to that radical shift in their narrative. It is true that there had always been some resentment of students: they did have many privileges not shared by their contemporaries who were in work at the same age. It is also true that they enjoyed high income after graduation, if they chose such careers. It is true that the rationing meant the opportunity was not available to all, as well. By now that seems to be the accepted truth and it serves to justify the change: as with the sale of council houses it is part of the truth: but it is not all.
As an example of the other side of the question: the wage premium existed and is much touted as a reason for people to go on in education. But it is important to remember that at the time that system was in place income tax was not a dirty word. Those who gained high paying jobs paid very high levels of tax: when that was factored in over a life time's earnings there was much more equality than there is today. In recent times there has been discussion of imposing a "graduate" tax because of the premium: but that is a poor solution. It is based on an average, and averages do not reflect real lives. If the "payback" is based on tax on earnings it has this consequence: graduates can choose to go into lower paid work because other values are important to them. The benefits (if you accept that education has benefits for the work place) are thus distributed over all of society: not evenly, certainly: many will pursue high income first: but to some extent. That is a less viable option of the student has debt to repay: it is lost completely if there is a graduate tax; because that is paid whether the income is high or low.
In addition, and as already noted, the premium is there because of scarcity: if everyone has a degree then there is no chance the premium will continue to exist. So the student will have debt in anticipation of higher earnings: but those earnings will not materialise. And it is nobody's fault: magic of the market, just. Or a broken contract, if you see it that way. Curiously, contracts of that sort between the citiizen and the state are not enforceable: if the government persuades you to do something against your own interest; or breaks the contract of employment you entered, in taking a lower paid public service job taking account of pension arrangements, you have no recourse. Yet the same neoliberals who promote those policies are very gung ho for enforceable, fair contracts: they are one of the few things they think the state is any good for.
So the normalisation of debt contributed to the atomisation of society: in effect the belief that there is no such thing as society is self fulfilling: it leads to policies which make it functionally true in many ways. The imposition of debt is just such a mechanism, because no matter how relaxed about debt we perciever ourselves to be, debt causes insecurity: you stand over the abyss and your choices are thereby restricted. All this in the name of increased personal freedom.
Edited by FionaK - 9/10/2012, 12:19
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