Freed from 30 years of administration and endless meetings, after taking early retirement from the day job in 2000, I started a happy time in the Education Department at Oxford University as an honorary research fellow. With some teaching I was able to research, write and study the depressing antics of our political masters and their aides as they further degraded what could have been a fair democratic education system into what became an unfair and corrupted system. In a pointless gesture, I resigned my fellowship of the Royal Society of Arts when asked to pay £50 towards an academy school (I did rejoin later!). I served on yet another commission looking at the Future of Multiethnic Britain thatwas duly rubbished in the press (Parekh 2000), but I tried to help education along in a country where, after various postcolonial wars, there was not much of it. This was the independent republic of Somaliland, where as a Trustee of the African Education Trust I could help train teachers and skill disabled people (Tomlinson & Abdi 2003). On several occasions in the north of Somalia we had a bodyguard with an AK-47, although as most people welcomed any kind of education, there wasn’t much need for an assault weapon, and I was never sure if anyone wanted to kill a granny. I also spent eight years on the council of the University of Gloucestershire, including chairing their employment committee, which was a much more dangerous activity.

BEING TONY BLAIR WAS TOUGH

Reading his memoir, A Journey (Blair 2010), you have to feel sorry for Tony Blair. As a privately educated young man (Durham Choristers, Fettes College and St John's College, Oxford), his first love was Amanda, the only girl at Fettes, whose father was a judge at the European Court of Justice.

Hælth – From WHOLE, a being whole, sound, or well.

The first duty of Beveridge's committee was to survey existing national schemes of social insurance and allied services; the second was to make recommendations. Such a survey cannot have been an easy undertaking, but can you imagine conducting a similar one today? Consider, for example, the sheer complexity of welfare provision exposed through the chaos of universal credit introduced in 2013. Somehow, in seeking to simplify benefit payments and streamline six separate schemes into one, the system became even more complex. Or imagine trying to unpack exactly why, during a global health crisis, one set of benefit recipients would be deemed in need of a temporary uplift to their payments while others would not. And that is just those services that, supposedly, safeguard against want. But what would a survey of the services and schemes of today actually conclude? What would Beveridge recommend now? It is tempting, in a discussion such as this, to reel off the latest questionable decisions on service provision; or perhaps to spend time dissecting decisions that seem to have been motivated by short-term budgetary constraints rather than long-term planning. A biography of such changes to welfare and service provision is not, however, our task in this book. Instead, we are surveying progress in tackling Beveridge's giant of Disease given the foundations he laid for our welfare state, and making recommendations to tackle that giant, which is somehow more monstrous today. To begin, we need a picture of the contemporary giant of Disease, tracing its evolution from the infections, emerging chronic diseases and relatively short lifespans of 1942 to the behemoth of today.

MORE THAN THE ABSENCE OF DISEASE

In general, how would you rate your health? In the UK, this may sound a familiar question, at least to anyone who has completed the decennial census. In the census, you are encouraged to consider any aspect of your health that you think is relevant. So, what is relevant? The criteria you use to evaluate your health in the last year might be different from that which you would have used five years ago, or as a child, or as you might in the final stages of your life. But the criteria you probably use to evaluate your own health doesn't just change as you age, it will also change depending on when you are aging.

Is the UK's current approach effective in helping people back into work? Or could it be that the focus on “work first” actually gets in the way of achieving a “higher pay, lower welfare” economy? To answer these questions, we need to explore in more detail the focus on moving people into any job, the role of sanctions and low benefit levels and the employment support offered to people looking for work.

Universal Credit is now the primary vehicle for active labour market policy (ALMP) in the UK. It is both an in- and out-of-work benefit – underpinned by conditionality alongside financial sanctions if behavioural expectations are not met, but also employment support from Jobcentres and other employment support providers. Universal Credit extends and intensifies the conditionality for out-of-work social security claimants that has increasingly featured in UK active labour market policy over the past few decades. People claiming out-of-work benefits and subject to conditionality must meet UK government prescribed requirements including: attending appointments at the job centre, completing online jobseeker journals, providing evidence that they are actively seeking work (typically looking for work 35 hours per week), or participating in training or welfare-towork programmes (e.g. the Work Programme).

Failure to meet the conditions attached to their benefit may result in a “benefit sanction” – meaning that a person's benefits are reduced or suspended. In an unprecedented move, and because Universal Credit is also an in-work benefit (see Chapter 2) conditionality may also be applied to working claimants – so people who are working may now face new expectations to increase their hours or pay in exchange for additional income through Universal Credit. In the UK, Jobcentre Plus – the Public Employment Service – and within them work coaches, are the first port of call for those seeking work. However, contracted providers increasingly feature – as non-state organizations deliver various welfare-to-work programmes (e.g. the Work Programme, Work and Health Programme and most recently Restart).

ANY JOB IS BETTER THAN NO JOB: IS WORK FIRST A PRODUCTIVE APPROACH?

Now considered an archetypal work first regime, the UK's approach focuses on moving jobseekers into work quickly. As we showed in the previous chapter, over time, the UK's approach has become increasingly directive, requiring jobseekers to accept any job offer. Those claiming out-of-work benefits must sign a Claimant Commitment, which outlines their responsibilities in relation to finding paid work.

Another busy decade from 2010 for global capitalism, education and me, none of us doing too well by the end of it. I joined the council of a further education college for four years and also joined a limited company of four of us to keep the local library open. I had an emeritus grant from the Leverhulme Foundation to study “low attainers in a global knowledge economy”, which let me visit schools and colleges in England, New York, Los Angeles, Malta, Finland and Germany, with conferences to talk about it all in Istanbul, Portugal, Holland and Chicago. Still more writing, including a book with Danny Dorling, Rule Britannia: Brexit and the End of Empire (2020). In this we noted that England had led the way out of the European Union and onto a downward spiral in world trade and respect, and that national identity was up for grabs again as it slowly dawned that there was no empire to loot any more. In 2013, along with a hundred other education professors, I was called a Marxist “actively trying to prevent children from getting the education they deserve” by then education secretary Michael Gove. He was keen on promoting democratic values that he claimed were “British” but along with his adviser, Dominic Cummings, seemed to have promoted some dodgy values himself. As a good sauvignon-blanc socialist I stood as a Labour candidate in a local council election and got 13 per cent of the votes in a very Tory village. My admiration for people actually working in schools increased, but incredulity grew as the White Papers, Acts and guidance from what had reverted to the DfE further entrenched a hierarchical, divisive and increasingly corrupted education system.

Before the start of the Second World War, the UK had experienced two decades of high unemployment. For Beveridge writing in 1942, the Giant of “Idleness” was primarily about worklessness and a lack of jobs for the male breadwinner. Today's labour market is very different. Far fewer people are unemployed, the number of women in paid work has increased dramatically, but in-work poverty is rising and increasing numbers of people face new forms of insecurity in work. Today's problem is not a lack of work, but a lack of quality work with a good level of pay.

Although the mantra that “work is the best way out of poverty” remains firmly entrenched in parts of the political psyche, the reality is that the UK has become stuck in a low-pay lowproductivity rut. Rising in-work poverty, low productivity levels, falling rates of progression and increasing “precaritization” of the workforce increasingly call this into question. Tackling un- and underemployment in a post-Brexit, post-pandemic UK necessitates a substantial shift in our understanding of the problem and our response to it. This is crucial if ambitions to “build back better” are to be realized. In this book, we show why quality of work is the most pressing labour market issue facing the UK today, and what must be done to solve it.

Underlying all of these issues is the question of power in the labour market. In the past, this discussion has focused on unionization and collective bargaining, which undoubtedly improves outcomes for workers. But there is a more subtle way in which worker power needs to be considered. By and large, for people who are unemployed or on a low income, power is in short supply. The way the state engages with people out of work, through coercive active labour market policies, a lack of concern for skills and career progression and a one-size-fits-all approach to out-of-work support that ignores the needs of lone parents, disabled people and others, exacerbates this problem.

The degradation of social infrastructure – declining local bus services, childcare services that don't meet the shift patterns of low-paid workers – conspire to create barriers to work, especially for women. If you need to be at the school gate by 3.15pm, the pool of potential jobs shrinks very quickly. As we show, childcare and transport are not only social policy issues but fundamental to tackling low-pay low-productivity Britain.

By the end of the war, Britain’s housing situation was in dire straits: 12.5 million homes had been damaged, 250,000 beyond the point of human habitation. Hundreds of thousands more were in desperate need of repairs (Timmins 2001). However, during the war years, house building had been halted. It was no surprise, then, that with a population buoyed by the promises of the Beveridge Report, housing became a cause of militancy across the country. Michael Foot, newly elected MP for Plymouth Devonport and future leader of the Labour Party, recalled that during these years “every MP and every local councillor was being besieged by the endless queue of the homeless” (quoted in Harding 2020: 55).

In 1945, the coalition government presented its Housing White Paper under intense scrutiny. This was the first official document to accept the principle that government should assure that every family could find a dwelling. To discharge such a duty, the government acknowledged that up to four million homes would need to be built immediately. Such acceptance was palatable to Labour, far less so to Conservatives. Nonetheless, having undertaken wartime planning, and having been in a wartime alliance with the Soviet Union, Tories could no longer easily claim that the state was an illegitimate vessel by which to secure public needs.

In 1954, Norman Macrae, a journalist at The Economist, coined the term “Butskellism” – an amalgam of the surnames of then Conservative Chancellor of the Exchequer R. A. Butler, and his predecessor, the Labour politician Hugh Gaitskell. Macrae satirically used the term to denote an apparent postwar consensus between parties when it came to a comprehensive welfare regime, a mixed economy comprising an alliance between state, business and labour, and demand management in service of full employment. Butskellism quickly transformed from an amalgam to an explanatory term, which expanded to include defence policy and then extended forward to cover the entire period up until Margaret Thatcher’s premiership.

In recent years historians have questioned the depth and strength of this consensus (see Rollings 1996). In this chapter we demonstrate that, when dealing with the giant of squalor, one can question whether a consensus ever existed.

This book is part of the World Economies series, which provides country histories of the most important economies of the world. Mexico, today’s sixteenth largest economy, showed a remarkable growth path since the Great Depression to the oil boom of the 1970s, as GDP increased on average 5 per cent each year. Then came the debt crisis, profound economic restructuring, and a fairly stable low growth rate of approximately 2 per cent per year on average until the present day. Thus, the gap between Mexico and the most developed countries, and with the most prosperous emerging markets, has widened since the 1980s. The near future does not look promising.

The aim of this work is to show the factors that explain this economic path and it focuses on Mexico’s overall performance with a close look at the various institutions, groups, entities and actors that have shaped Mexico’s development since the 1940s. As with other nations, it is not possible to speak of a continuum, across the country, given its diverse geography and ethnic groups. Thus, regions and particular sectors are considered in detail only when it is necessary to understand the country’s path of development and its current situation. The approach adopted also gives due consideration to political economy arguments that help explain historic major turning points and public decisions that have made a long-lasting impact. This is essential to understanding Mexico’s present and future. The periodization shown throughout the book is determined by those turning points that shape the topics of the various chapters. Although there is a coincidental path in several areas, not all reflect a homogeneous path of development, for example, public efforts to improve education does not necessarily match in time with efforts to increase health coverage.

The book provides a general understanding of the origins of Mexico’s recent economic development as well as its current structure, regional differences, social polarization, productivity gaps and the challenges ahead posed by the new government. It also examines the relative robustness of macroeconomic fundamentals that have shaped economic and social policy over the years, with disregard to ideological differences of various governments since the 1990s.

This final chapter considers regulation of the labour market. The starting point for such discussions is usually that there is a tradeoff between protecting workers and strengthening the economy, and the political process decides where on the spectrum policy will end up. We show that in fact a reluctance to protect working conditions exacerbates the imbalance of power between workers and employers and contributes to the low-pay low-productivity equilibrium that locks too many people into low-paid work, and slows down the UK's economic performance.

CONTESTED POLICY

Labour market regulation has been a contested area of economic policy for centuries. When the first Factory Acts started limiting children's hours of work, there were voices that protested at the economic damage such restrictions would cause. Lord Lauderdale said in the House of Lords that he opposed the Cotton Mills and Factory Act of 1819 because it violated “the great principle of Political Economy that labour ought to be free” (Walker 1941). This Act prohibited employing children under the age of nine in the cotton industry and limited work for those aged nine to 16 to 12 hours a day (UK Parliament, n.d.). Over the course of the nineteenth century, legislation limited further children's and later women's hours of work, introduced factory inspectors and the first new rules for managing dangerous machinery (Bloy, n.d.).

Today, we take for granted a much wider range of protections. The Contracts of Employment Act 1963 brought with it a right to a written specification of hours of work, pay rates and notice periods. The 1960s and 1970s saw the first protections against discrimination at work, covering race and sex. Recent years have seen these protections extended to cover disability, sexual orientation, age, religion and belief. For two decades, there has been a national minimum wage, limits on hours of work for all workers – not just those in factories – and rights to a minimum amount of paid holiday leave each year.

Previously we noted that Friedrich Engels used the term “social murder” to describe premature deaths amongst urban workers caused by industrialization. Engels might be forgiven for rhetorical excess. However, the structural violence his term implies has a long tradition of analysis in Marxist political economy.

In 1982, geographer David Harvey published The Limits to Capital. In seeking to understand the process of urbanization within a capitalist context, Harvey wished to update some of the basic explanations of capitalism provided by Karl Marx. For our purposes, the book is important due to its attempt to think through how mobile circuits of capital shape and affect built environments and neighbourhoods. Harvey (1982: 397) described part of this process as an “organized abandonment” of locales by capital.

Harvey took an example of organized abandonment from his then place of residence, Baltimore. “Redlining” refers to a historical practice of using covenants to exclude Black people from owning property in planned neighbourhoods. Redlining can also take more subtle racist forms, such as denying – or massively increasing the cost of – financial services for people living in a particular postcode that just so happens to be predominantly populated by Black people. Harvey’s point was that this abandonment of the neighbourhood by finance was anything but haphazard. Rather it was organized via institutions that had mastery over the transmission line from local populations through the state to capital. Organized abandonment is almost always poverty-inducing and, in short, maintains destitution and therefore squalor.

Another geographer, Ruth Wilson Gilmore, mainly known nowadays for her work on prison abolition, updated Harvey’s thoughts in the 2000s to refer to neoliberal state reorganization specifically. Glossing many of the processes that we described in the previous two chapters, Gilmore (2008) connects organized abandonment to crisis-led restructurings of the economy. More recently, Brenna Bhandar (2018), a critical legal theorist, has used the term “organized state abandonment” to describe the conditions that led to the Grenfell Tower fire. Bhandar speaks incisively of the “abandonment of the state’s responsibilities” to provide safety and security for its citizenry, noting how such abandonment reignites hostility towards the poor and working class, as well as more recently arrived migrants.

At the beginning of the 1990s, Mexico underwent critical structural changes that responded to the previous decades’ recurrent crises. Despite the difficulties that arose in the middle of the decade, like the 1994–95 crisis, the government had made significant adjustments for deepening the social, political, and economic transformation begun the previous decade. Those reforms entailed creating economic and political institutions, strengthening judicial power, and economic reforms necessary for the long term. It is essential to consider that such changes occurred when the country was still facing high debt, inflation, and mistrust from the private sector.

In the international context, 1989 witnessed a year of political and economic events that were incredibly significant. The fall of the Berlin Wall marked a new economic reopening, the end of state interventionism, stable public finances, and the predominance of the market. At that moment, Mexico took significant measures: reopening of trade, privatization, and institution building. Simultaneously, the Washington Consensus appeared as a path that many countries were obligated to take. Mexico was a conspicuous example of a country on that path in the years that followed.

INSTITUTION BUILDING IN THE 1990S

One of the country’s leading institutions that suffered radical changes was the Bank of Mexico (Banxico). In 1994, the Bank of Mexico acquired its autonomy through a constitutional mandate when President Salinas was still in power. The objective of central bank autonomy is for the bank to take its own decisions apart from governmental interests as an antidote to expansionary monetary policies like those implemented in the 1970s. Considering the bank’s critics about its minimal interventions in the 1982 crisis, one might have expected that the Bank of Mexico would act independently in the upcoming 1994 crisis, but it was unable to control the balance of payments crisis which was very costly to the country’s economy (Chávez 2004).

Despite the difficulties with which the Bank of Mexico started its independent status, it progressively corrected its roles to become a hightier institution. Once the government diminished the intensity of the 1994–95 crisis, the Bank of Mexico managed to promote economic stability and the landscape changed gradually.

Work should be a reliable route out of poverty, but the majority of people in poverty are now in working families; seven in ten children growing up in poverty live in a working family; and four million workers (about one in eight) live in poverty (Innes 2020). This is in spite of the UK's employment rate hitting an all-time high in the years leading up to the Covid-19 pandemic in 2020 and the UK having one of the highest minimum hourly wages in the world. Over the last 20 years, the risk of living in working poverty has risen, particularly during two periods of time: in the five years leading up to the Great Recession in 2008 and in the recovery from that recession, from 2012 onwards. Three factors drove this sorry situation: earnings, housing costs and social security.

JOBS AND EARNINGS

During the first period of rising in-work poverty, from 2003/04 to the recession in 2008, earnings grew more slowly for those at the bottom than they did in the middle. At the same time, housing costs rose faster for those on low incomes than the better off. During the 2008 recession, earnings fell fastest for low-income families as employers cut back their hours, but they were protected by the tax and benefit system and so in-work poverty again stayed flat (falling housing costs helped both those on low and middle incomes so didn't affect the poverty levels). The recovery from 2012/13 onwards saw earnings grow at about the same rate for low-income families as they did for those in the middle, but rising housing costs hit those at the bottom hard and swingeing cuts to benefits pulled hundreds of thousands into poverty.

It might seem strange that earnings for those at the bottom weren't outstripping those in the middle, given that the rising minimum wage meant that hourly pay did go up more at the bottom than higher up.

So far, we have focused on how state policies aimed at low-paid workers – on welfare and skills – have the effect of undermining bargaining power in the workplace. However, the state's effects on low-paid workers have much broader scope. In the final chapters of this book we turn our attention to wider factors that influence the labour market, exploring the role of social infrastructure and state regulation in supporting good work and overcoming labour market exclusion.

Starting with the former, we show how degradation of social infrastructure – from declining local bus services to childcare services that don't meet the shift patterns of low-paid workers – conspire to create barriers to work, especially for women. As we show, childcare and transport are not only social policy issues but fundamental to tackling low-pay low-productivity Britain. Childcare Self-evidently, childcare is essential to parents being able to work: no parent can go out to work unless someone is looking after their children. The responsibility normally falls on mothers: employment rates in mixed-sex couples with children under 12 are 20 percentage points lower for women than for men; average hours of work are more than 40 per cent lower; nine out of ten lone parents are women. Time-use data shows that women spend twice as much time as fathers looking after children (Wishart et al. 2019). Seven out of ten mothers of children aged below four say that having reliable childcare helps them to go out to work (DfE 2019).

Childcare in the UK is more expensive than most other highincome countries. Support for childcare is a mix of free and subsidized provision, support through the welfare system, and tax reliefs on childcare expenditure. Taking these into account, the net expenditure on childcare for couples with two children aged two and three using formal childcare is likely to be around one third of the average wage. For lone parents, net expenditure is lower. However, at 10 per cent of the average wage, there are still only four countries in the OECD with higher rates (see Figure 9.1).