Homelessness is caused not by poverty but by wealth

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When you put rising housing costs alongside stagnating wages, an alarming trend in normalising insecure work, persistent unemployment and underemployment, and statutory incomes that are going backwards in real terms, there’s good reason to be deeply worried about an increase in homelessness.

Late last year, Everybody’s Home, the national campaign to end homelessness, commissioned research by Equity Economics, showing that homelessness could surge by 9 per cent this year. In marking Homelessness Week last week, Homelessness Australia released data showing that cuts to social housing funding and homelessness services over the last ten years will soon exceed $1 billion.

At the same time house prices have gone up by 50 per cent and rents by 31 per cent. In fact, a recent Per Capita paper, Generation Stressed: House Prices and the Cost of Living in the 21st century, by Matt Lloyd-Cape, shows that from 1970 to 2000 the cost of owning a home rose by a whopping 130 per cent.

Covid has taught us much about how things really stand. And how they so easily fall! We have learned that yesterday’s relatively secure job can easily become today’s precariously insecure job and today’s insecure job can become tomorrow’s application for a JobSeeker payment. Parallel to this trajectory, of course, today’s mortgage or rental might easily become tomorrow’s default or eviction.

Covid has driven home the interconnectedness of things. We are seeing how there are connections that have previously gone unnoticed, not just between policies, but between ourselves!

You can’t keep society going without working people. We’ve noticed that the people we tend to refer to as ‘essential’ are often actually amongst the lowest paid and the most insecurely employed. We’ve noticed that you can’t do public health if you haven’t ensured that people have safe housing. And that if we can’t expect someone who has just lost their job due to the pandemic to live below the poverty line on JobSeeker, then how can we expect anyone else to?

 

'Homelessness is caused, not by poverty, but by wealth, especially speculative wealth, concentrated in the hands of the few, to the detriment of the many.' 

 

We've noticed the gentle ease of a society rich in the kindness of strangers. We’ve noticed that many of the people we’d taken for granted, workers who clean our hospitals, who produce or process or pack or transport our food, who serve us in supermarkets, who nurse us, who teach us, who help us out, who keep the lights on, workers who are not highly valued by capitalism, people that some of us had been taught to unsee, are precisely the people we’d be lost without.

And that many of those who hold political power or economic privilege are precisely those we can do without. We can, for example, do without those who have no qualms about hanging on to generous corporate welfare while raking in the pandemic profits. And we can do without those who frame legislation in such a way that this is actually encouraged and allowed. We can do without those, whether in government or in the corporate sector, who praise essential workers one week and then strip their wages and conditions, or indeed their jobs, the next.

We’ve not only seen our lives turned upside down, we’ve seen policies being rolled out that many of us had longed for and had never given up fighting for, but which would not have happened in ‘normal’ circumstances.

We saw the unprecedented, albeit all-too-short-lived, doubling of the JobSeeker payment. We’ve seen accommodation being provided to rough sleepers. We saw a job subsidy implemented, albeit one which the Morrison government had to be dragged kicking and screaming by the ACTU to agree to. We saw a brief period during which early childhood education was made available freely. And now we are (gradually!) seeing a nationwide public health intervention in the shape of mass vaccinations.

Pretty much every one of these policies and programmes have been done in ways that invite criticism. The Coronavirus Supplement for people experiencing unemployment was brilliant while it lasted but was then completely withdrawn, pushing people back below the poverty line. JobKeeper saved jobs and kept households out of poverty, but it was structured in such a way that permitted companies that did not need it to take it and keep it despite chalking up significant profits, and it excluded significant sections of the workforce from any means of support. And it too was withdrawn far too early.

The accommodation for rough sleepers was, in some places, impressive, and showed that governments really can end homelessness, but if you know that your accommodation, no matter how good it is, is short term and insecure you can't really say you’ve got a place to call home. The brief dalliance with free early childhood education was… brief. Can’t be getting too socialist now, can we! It also failed to address the underlying structural problem of inadequate wages for early childhood educators. And the roll-out of the vaccine has been so poorly managed by the Morrison government that it may well end up being the chief reason why it may lose the next election.

But still, we’ve been given a glimpse of what can be done when the pressure is there.

Labor has also given us a glimpse of something we haven’t seen for a very long time, namely a commitment to a Full Employment framework, with Anthony Albanese signalling that this would be an incoming Labor government’s first White Paper. Again, this is something that many of us have been fighting for over many years, with little appetite previously being shown by political leaders for this common sense approach, not since the framework developed in the Curtin government’s 1945 White Paper on Full Employment was systematically dismantled by the harbingers of neoliberalism in the 1970s.

Which all goes to show that the economy is not some kind of magically invested entity that floats somewhere above us, controlled by an invisible hand and moved by the 'animal spirits of capitalism' which the prime minister is curiously reverential towards. The economy is a political struggle.

We cannot return to the pre-neoliberal period. We can, however, prepare a way forward that delivers a strong and proud architecture for a social guarantee, including a place to call home for everyone, jobs that we can rely on, well-funded public health and public education, and a respectful, rather than demeaning, mode and level of income support for whoever needs it.

Democracy should mean so much more than a vote every few years. It should also encompass our means of economic decision-making, the democratisation of our public sphere, rather than its rampant privatisation and constriction, the recognition of the socially crucial role played by workers who organise themselves collectively into unions, the unapologetic uprooting of patriarchal power and the gender inequality and gendered violence that is its hallmark, and, at the very heart and as the very foundation of a democratic renewal, the implementation of the structural reform called for in the Uluru Statement from the Heart.

Homelessness is caused, not by poverty, but by wealth, especially speculative wealth, concentrated in the hands of the few, to the detriment of the many. It is not just an effect of a disastrously structured housing market that makes of housing a speculative sport rather than a human right. Homelessness is the cumulative effect of those structures that are designed to degrade, designed to disempower, designed to constrain the democratisation of life, especially colonisation, patriarchy and neoliberal capitalism. If we want to address homelessness we need to begin to carve out a space for social and economic security in the midst of the current uncertainty. This, of course, means a massive boost to social housing, but it also means a reimagining of what really matters in our lives.

Right now, in the midst not only of a pandemic but of a climate emergency of catastrophic proportions, the one thing we can be certain about is uncertainty. The French poet, Paul Valery once quipped that 'the trouble with our times is that the future is not what it used to be.' But perhaps this is also not just the trouble but the one real hope that is hidden in the still raw wound of our times. The pandemic shows us both the horror of leaving things as they are and the urgent hope of shaping a radically different horizon.

 

 

 

John FalzonDr John Falzon is Senior Fellow, Inequality and Social Justice at Per Capita. He is a sociologist, poet and social justice advocate and was national CEO of the St Vincent de Paul Society in Australia from 2006 to 2018. He is a member of the Australian Services Union.

 

Topic tags: John Falzon, Scott Morrison, capitalism, neoliberalism, unemployment, auspol

 

 

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Existing comments

How much mental illness, suicides and distress are closely linked with the constant stress of lack of safe accommodation! Maybe someone in your family has experienced this. It is a scandal that this continues, when better government policies could end this.


Bruce Duncan | 10 August 2021  

A good read, sometimes insightful but I think fails in delivering because of circular argument (petitio principii); the article assumes the premise is true rather than demonstrates how wealth causes homelessness. It relies on an understanding of poverty should not in itself be a barrier to "a home" and pleads speculative (filthy) rich are driving up market prices in the unfortunate turn of phrase animal spirits of capitalism. This is a bit emotive, creating an us versus them vibe but perhaps we can tone it more equitably to dwell on the prey and predatory with the oft overlooked vultures who take land taxes, stamp duties and charges at ever-increasing amounts calculated on the ever-increasing property value; those speculators pay pretty dearly to swap properties and capital gains tax if they made an obscene thing called profit. So let's run with the notion everybody gets a house (home) and form of title, each, afforded by some consolidated revenue; can they then sell it at a loss? Can they transfer it by will or gift to any beneficiary of choice or lose it in court proceedings or a card game? Must they maintain, insure and pay rates or does that millstone roll over the commonweal grist too...


ray | 11 August 2021  

This is a comprehensive summary of the current Australian economy and the effects it has on many workers in numerous industries. One fact that is not included unfortunately is the low membership of workers in unions.
Without an organised voice, workers are now and have been in the past easily exploited.
With the changing cultural make up of the working class the history of the Australian union movements is not being promoted to those workers.
When workers are organised and united they are best able to represent themselves and overcome the issues they face.
Trade unionism is supported by Catholic social teaching and I believe it should be promoted throughout the Catholic population.


Kevin Vaughan | 11 August 2021  

My homelessness at the age of 64 was caused by my ex-husband transferring the marital home, property and monies to his friend (a complete stranger to me). I went to Court to get my marital property back into my possession. Instead, the Courts let the stranger keep my marital property. I was illegally evicted into the street by a Court judge with no assets. I was homeless. Now I have a PETITION going to UNITED NATIONS trying to get HUMAN RIGHTS INTERNATIONAL LAW into the domestic level - see https://chn.ge/2Hpu2aa as there is no redress for this type of activity at the domestic level. Before the eviction, I had my own roof for 36 years.


Alexandra Samootin | 11 August 2021  

Ho-hum, I'll just re-post my comment to a previous article by J.F. on housing from a few years back, famously unanswered some of the figures might be slightly different, but the big picture is the same. : "If government were not in the way, one could build a basic earth bag house for around $300.00, and a really nice one for around $5,000 in about six weeks. But government *is* in the way. So there are 540 regulatory ticks required from start to finish of a basic house in Melbourne, which the earth bag house would totally fail, even though it has excellent green credentials. And then around 44% of the final cost of a regular house is in taxes. Moreover, the cost of land itself is astronomical compared to regions around the world with similar population density (eg Texas). That's because of government land use/release/zoning restrictions. It's bleeding obvious that the biggest enemy of affordable housing for the poor is the state."


HH | 11 August 2021  

"Democracy should mean so much more than a vote every few years."

Absolutely.

In a 'mixed economy' people can only signal their needs to 'the market' if they have money.

Which is to say, without money, people are invisible to the market, so the market can never respond. This is bad for people and bad for business.

A Universal Basic Income is the most democratic expression of individual needs. It is not mediated by government or charities. It is each person being able to say what and how their specific needs should be met

A UBI does not mean that all needs are met by 'the market'.

We still need government and charities to supply critical goods and services, such as universal health and education, as well as charitable support that helps people navigate life in the 21st Century.

We need a UBI for the simple reason that 50% of the population have no direct access to money: young, old, incapacitated, their unpaid carers and those between jobs. This is not a static group: the young grow up, the old and incapacitated die and their carers and the unemployed find other work - only to be replaced by a new cohort.

It is 'us' over time'.

While in this group, people get money from family, welfare, charity and crime (a rational response to exclusion). For around 12-14% of the population, these sources are insufficient. Mainly women with young kids, the elderly and incapacitated as well as a significant proportion of those between jobs - all of whom lack savings and a home.

This problem cannot be solved by 'growing the economy'. It is a demographic/system problem.

Only a UBI can solve it, while also ensuring people are motivated to take on paid work when they can

Most people want to raise themselves and their family 'above survival living'. With a UBI they can achieve this as they are not penalized by having their UBI taken away when they take on work.

A UBI need not replace welfare, though it would replaced charity food lines. We don't need food lines, as we have a perfectly good distribution network called 'shops', as long as people have the money to signal their needs.

The UBI does not have to replace welfare. It can simply be treated as income for calculating entitlement, phasing out welfare as the UBI is increased. Just as if people were earning the money.

This would remove the poverty trap that is traditional welfare, without changing all the welfare programs that have been designed to meet specific needs.

If people are interested, Basic Income Australia has prepared policy paper that shows how we can provide a $500/week UBI. Contact: m.haines@VANZI.com.au


Michael Haines | 11 August 2021  

With Ray continuing to bowl his telltale googlies and HH rehashing his timeworn condemnation of the state, what chance has Kevin Vaughan got of advancing his oft-expressed views that Eureka Street should spread the Catholic Social Teaching - already a centrepiece of this journal's publishing policy - that trade union membership should be de rigueur for all Catholics? Uplifting, though, to see Bruce Duncan newly entering the fray by specifying the toll that homelessness takes on suicide numbers which are at an all time high. This is a universal phenomenon, especially closely linked with 'Covid-speak', which currently dominates the air-waves and television channels. Perchance the current focus on mental health could then expand from improved band-aided counselling provision for mentally-depressed people to root-cause analysis of this phenomenon. This would offer a more graphic, captivating and empowering point of entry for the overall policy change that John Falzon valiantly desires. Mightn't the Talk-Shows Media Gurus, most of them usually catering to viewers with a 2-minute attention span, then be persuaded to take up this suggestion for fear that we trumpet the hidden but dominant dog-eat-dog view that suicidal behaviour is entirely a matter of individual choice that no intervention can circumvent?


Michael Furtado | 11 August 2021  

Thank you John for another insightful analysis of a very important social issue. If we lived in a society where all people mattered - including those who find it hard to have a roof over their heads - then we might just find homelessness would not be such the problem that it is today.

Sadly, our political leaders are more interested in looking after the wealthy housing market speculators (and those involved in energy production insisting on the continued use of coal and gas to the detriment of the environment) to obtain huge donations for their political parties and for gaining lucrative positions for themselves when they retire from politics.

In a civilised and humane society, governments would ensure that there is enough housing for all, by controlling the charges on houses and by having more public housing for those who find themselves in dire straits economically in times like this when permanent employment is hard to find and many employers do not pay adequate wages.

Given that we are facing several crises at this time - pollution causing premature death on a massive scale and climate change along with the COVID-19 pandemic - the government should be organising public projects like building extra housing, providing more jobs in renewable energy productions and green industries, more effective recycling etc. During the 1930s Depression, some governments organised socially useful projects for the unemployed. Our federal government should be doing this now.


Andrew (Andy) Alcock | 13 August 2021  

Frustrating when one recalls e.g. the '70s Victorian Hamer Liberal government which supported significant investment in public housing.

However, since Howard owner occupiers have been encouraged to view themselves as savvy property investors and to spread their wings with state support e.g. negative gearing and promoted by the 'prosperity gospel'.

A solution of sorts exists in the major cities with empty apartments and/or unfinished developments. However, the current libertarian ideology and power of real estate or FIRE sector precludes more public housing as it would impair house values.

Quite troubling observing Australians' obsession over their insatiable need for 'prosperity' aka UK and US, but with sub-optimal wellbeing.


Andrew J. Smith | 15 August 2021  

The ownership of investment properties is extremely "Out of Hand" and this is because they can offset their tax by "Negative Gearing" which means that our taxes pay for their houses; all legal of course. The Parliamentarians and the property investors are the only winners in this. The normal homeowners struggling all their lives to pay their mortgage are the losers in this catastrophe. "Negative Gearing" must be abolished as there are too many investors with their snouts in the trough. The "Powers That Be" refuses to put a stop to this tax rort and greed even though many of us have tried to campaign for this to be addressed. It is making it near impossible for the 1st homeowners. Rental prices have gone through the roof and will continue to do so thus causing extreme hardship and homelessness. Applying for a rental home is like a lotto win these days.


Mary Adams | 18 August 2021  

Thanks for your evidence-based devastating refutation of my position on the possibility of low cost housing in Australia, M.F. I'll consider every substantive point you've raised.


HH | 01 September 2021  

Negative gearing is certainly something the federal government (of either persuasion) should look at. It will take some courage to do so, as there are many vested interests involved. The State Housing Commissions are cash-starved. Their role should be expanded. The Scandinavian countries have a far better attitude and approach to social welfare, including public housing, than we do. This stems much from their social cohesiveness, fostered by their origins in a rural cooperative society and the spirituo-social cement reinforcing that of the state Lutheran Church. These days they may not appear so overtly Christian, that's a Western European reality, but their ethics often are. It's interesting in Australia that this sort of collective social responsibilty often exists more strongly in certain migrant groups, such as Greeks and Italians, whose original countries have had dreadful histories of war and deprivation. Anglo-Saxons have been much influenced by the late Margaret Thatcher who famously opined that there was no such thing as society. This is nonsense. We need to foster genuine cohesiveness in our society. Really dealing with mental illness, homelesness etc costs. If we don't shell out sensibly now, I fear the long term consequences will be the creation of a society more like the USA where social welfare is poor and countless people live on the streets.


Edward Fido | 03 September 2021  

Thank you John for that opening “ homelessness is not caused by poverty but by wealth” so right. Last year during the Covid19 pandemic the worlds wealth grew by thousands of millions of dollars. The richest billionaires grew even higher. I read just recently that if the wealthiest people on earth combined their wealth and distributed to the poor there would be no one in poverty for 4 years throughout the world. And I would add during those 4years enough wealth would be created for the following 4 years. So your opening statement was so right, so spot on. Loved your following remarks especially on climate change. Some people including Morrison must be blinded that they can’t see what’s happening by the world disasters in just the past few years caused no doubt by climate change and some of those disasters happening in our country. The climate deniers like Morrison must bury their heads in the earth so cannot see what’s really happening above. You mention Morrison may not win the next elections due to his inaction for climate change l could add hundreds to those inactions including poverty in Australia, something I’ll be working very hard to achieve his non election. Again thanks for your writings. Jim Donovan.


Jim Donovan | 08 September 2021  

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