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June 28, 2003

in trust we place our faith

Social capital has been picked up by the neo-liberals in recognition that civil society exists and the market is not everything. And it is being deployed as a way of fostering social cohesion and community obligation to pick up the pieces from the fall out of economic reform.

In today's Weekend Australian there is an article entitled, 'Costello puts his faith in trust', by Dennis Shanahan & Megan Saunders. (no link, June 28-29, 2003, p. 4) The article is a report of a speech given by The Treasurer to an Anglicare lunch in Sydney. It is the Treasurer speaking on wider issues in an attempt to broaden his political appeal.

It addresses the role of charities with the windback of the welfare state under a neo-liberal mode of governance, and people falling through the large holes in the welfare safety net. Not that the Treasurer would have put it that way, of course.

So what does Costello say? He makes a big point upfront.

"Trust is a very important feature in our society. Trust is part of the social capital that our society relies on. Trust is hard won but easily lost".

He illustrates the claim with recent events involving the Churches. These have been strong moral critcs of the Howard Government's policies, but did not get too worked up about the moral failure of some of their priests inside the church. Costello then says:

"This suspicion that the institution of the Church may have been easier on itself than it was on others is corrosive of trust. I don't know if the moral failures we are now aware of are recent developments. But I do know that in an information society very little can now be hidden."

After suggesting that big government and charities corrode trust by being inefficient, Costello turns to the hole in the saftey net and the role of the volunteer sector vis-a-vis the state. He says that the role of small government is only to supply income support for the jobless, homeless and disabled.

"...that income support provides insulation against poverty but it does not treat the cause of poverty. Let us take a visible example. A homeless man who is drug or alcohol dependent will probably be entitled to income support. Mostly it will be the disability pension. The pension should be enough to provide food and shelter. But it doesn't in his case because the money he receives is always spent on the wrong thing. And it always will be until you treat the cause of the poverty which is alcohol and drug dependence."

Governments cannot cure poverty or marriage breakdown. The role of the charity is to address the cause of poverty:

"...these agencies can make more immediate and individual contact with those in need. They are run by people of religious and moral conviction willing to share their values in support of treating underlying causes of poverty. But, in addition these agencies are also targeting the giver as well as the receiver. They want you."

Costello argues that this volunteering is a good thing because it fosters social capital in civil society (Costello does not use the word civil society). He says that:

"Involvement in a voluntary association or charity enriches the giver as well as the receiver. And in a complex web of relationships between givers, service providers and those in need, all are drawn together and benefit in different ways. This is social capital. Outside Government, people of like mind and common endeavour have come together for a common purpose... They are not relating now through the tax file number and the bank account. They are relating as people."

According to Costello one of the positives of limited government is that it allows the non-government associations to develop and prosper and deepen the social relationships in a community.

So it is social capital as embodied in the practices of volunteer groups, Meals on Wheels and Neighbourhood Watch, and not trust, that is Costello's key idea.

And the politics of social capital? It is that the welfare state can be wound back and the charities do what the neo-liberal state does not do. It tacitly recognizes that free markets do not ensure that the fruits of growth are equally distributed. hence we have the limitation of free markets, especially in the era of globalization. Instead of doign the social democratic number and calling for government interventions to ameliorate the negative effects of 'unbridled self-interest and laissez-faire policies', Costello turns to the charities.

But where are the charities going to get their money to provide the services for drug or alcohol dependency, the fallout from marriage breakdown or mental illness?We cannot trust the government to pay for these services because they are not doing it at the moment. They are too busy ensuring the security of prosperity, being fiscally responsibly and ensuring budget surpluses to please the international money market. Many who fall through the safety net----called service and support gaps--- become homeless, rely on food kitchens and often end up in prison.

Posted by Gary Sauer-Thompson at June 28, 2003 12:24 PM

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At first i was surprised by Costello's use of the term social capital. I thought he meant money spent on welfare BY The Government. Foolish me. Perhaps the term 'social capital' could be hijacked by Labour to mean just that?? (- see "Liberal Language" at my blog)

charities recieve funding on the basis of their popularity, not according to which services are needed most..

Posted by: kez at June 29, 2003 07:52 PM

The big problem with Costello's theory is that it assumes that we have a Government as munificent and altruistic as our current one.

If a future Government is no-longer responsible for maintaining a safety net, then they won't feel responsible when it is rent, and they won't feel inclined to fix it.

Why does Australia intervene in the Solomans? Because their safety-net (law, civility) is shredded and civil chaos is resulting. Surely, according to Costello's theory, this should be left to the charities to sort out, no?

Costello's position is an absurdity. It will simply be another chasm separating the have's and the have nots.


Posted by: Rex at June 30, 2003 09:51 AM

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