A Calculus of Social Value?

I have been reading with great fascination Tony Judt's article in the latest issue of The New York Review on why the very concept of social democracy appears to be off the map whenever our government undertakes any effort towards reform, particularly in areas such as health care and financial services, both of which have had such menacing impact on Main Street. Judt's thesis is that our shortcoming is "discursive," meaning that we "simply do not know how to talk about" matters of social democracy; and he attributes this shortcoming to what he calls "economism," which he describes as "the invocation of economics in all discussions of public affairs." In other words we avoid "moral considerations" by restricting discourse to "issues of profit and loss."

As we know from those who have tried to identify countries that offer models for health care reform, Great Britain does not have this discursive problem. However, at least one British institution, the new economics foundation (nef—they use only lower case letters on their Web site), appreciates the problems of economism; and it is trying to argue against it on its own playing field. As Martin Shankleman, Employment Correspondent for BBC News, reported last night, this foundation has been trying to evaluate various jobs by comparing the value they create with the value that those who do the work are paid. This research has taken place under their Valuing What Matters program. Shankleman's report cited the results of how this study applied its calculus to six different jobs (with quotations from its report, "A Bit Rich"):

• The elite banker

"Rather than being wealth creators bankers are being handsomely rewarded for bringing the global financial system to the brink of collapse

Paid between £500,000 and £80m a year, leading bankers destroy £7 of value for every pound they generate".

• Childcare workers

"Both for families and society as a whole, looking after children could not be more important. As well as providing a valuable service for families, they release earnings potential by allowing parents to continue working. For every pound they are paid they generate up to £9.50 worth of benefits to society."

• Hospital cleaners

"Play a vital role in the workings of healthcare facilities. They not only clean hospitals and maintain hygiene standards but also contribute to wider health outcomes. For every pound paid, over £10 in social value is created."

• Advertising executives

The industry "encourages high spending and indebtedness. It can create insatiable aspirations, fuelling feelings of dissatisfaction, inadequacy and stress. For a salary of between £50,000 and £12m top advertising executives destroy £11 of value for every pound in value they generate".

• Tax accountants

"Every pound that a tax accountant saves a client is a pound which otherwise would have gone to HM Revenue. For a salary of between £75,000 and £200,000, tax accountants destroy £47 in value, for every pound they generate."

• Waste recycling workers

"Do a range of different jobs that relate to processing and preventing waste and promoting recycling. Carbon emissions are significantly reduced. There is also a value in reusing goods. For every pound of value spent on wages, £12 of value is generated for society."

This left me wondering whether there was any office in the overwhelming bureaucracy of our Government in which a comparable study could or would be performed. If we go to the Web site for the Bureau of Labor Statistics, we can find considerable effort being put into the analysis of productivity and employment costs; but there is no indication that the Compensation Research and Program Development Group is even remotely considering the sort of value-for-money methodology that nef adopted (which may explain the "New" part of their name).

Now, to be fair, nef is an independent institution. On their home page they call themselves a "think-and-do tank that inspires and demonstrates real economic well-being;" but, of course, there is no indication as to whether their findings will have any impact on national policy in Great Britain or anywhere else. Still, they pose any interesting challenge to our own country that seems to have so many evangelists promoting "out of the box" thinking. If ever there were an opportunity to restore moral considerations to our predispositions for economism, this would appear to be one that has taken a great leap out of the box (without jumping the shark in the process). However, given how successful our ruling class has been in beating into submission any commonsense interests from Main Street regarding either health care or banking, I find it hard to believe that nef will find any serious champions on this side of the pond!