Tax Credit Cuts and the Missing Word: Gender

By Andrea Sweeney

In the media and in recent political coverage of the government’s proposed tax-credit cuts, one key aspect of this issue was noticeably absent: its fundamentally gendered character. With austerity measures continuing, it is time to reinstate the word ‘gender’ into the economy and address the way in which these measures contribute to the redistribution of wealth away from women and minority groups, towards high-income males.

By looking at the ongoing political reactions to the 2008 economic crisis, and the rationale behind the focus on austerity, the gendered effects of austerity policies become clear.

The priority in response to the crisis has been to reduce the deficit and debt primarily through implementing austerity and cutting public spending. Whilst it was widely reported that cuts would likely negatively affect the worst-off in society, there has been a deafening silence on the fact that the make-up of this group is highly gendered. Women are overrepresented in the lowest paid sectors of the economy and are the largest group of tax credit beneficiaries. Some explanations for this are that, in the UK, women make up the majority of workers in the public sector, the gender pay gap continues to persist and in times of economic crisis, women are often the hardest hit for the longest period of time. There are not only financial concerns here; in times of hardship women are also expected to fill the gap when these services are cut, providing care to family members and taking on extra work with little or no remuneration.

Moreover there are intersectional issues to take into account. A recent Laura Bates article highlighted that in the UK, Black, Asian and minority ethnic workers make up a disproportionate number of people in low-paid jobs, with 23% of Pakistani employees and a fifth of Bangladeshi, Chinese and Black Caribbean workers earning less than £25,000 per year.

The rationale behind austerity is that low levels of inflation and a reduced deficit will benefit everyone equally as it will stabilise the economy as a whole. In reality there is growing evidence that such policies are in fact harmful to the welfare of the majority for the benefit of the few. These policies reflect an underlying, damaging conflation between the interests of the economy — viewed as a separate entity with needs of its own — and the interests of the people. This prioritises stability over economic and social well-being, despite the fact that such policies so far have failed to secure either. These goals must be understood as political priorities that consequently favour the wealthy. The incomes of those deemed responsible for the initial crisis have continued to rise, while income inequality widens and security worsens for those at the bottom.

The current wave of measures make up part of a long history of commitment to classical economic thinking which — despite claims of neutrality — is biased. Taking gender as a focal point highlights these biases. Under this thinking, the economic returns of work supposedly reflect its value and are regulated by the economy in a fair manner. Feminist economists have shown that, in reality, the wages connected to work are influenced by social norms and the values attached to different forms of work. This has led to a devaluation of many forms of labour deemed ‘feminine’, such as care work. Problematically, the social value of such work cannot easily be determined through measurement of output, because of its fundamentally human character. This has allowed it to be devalued and unfairly paid under the current economic system. There is clearly a disparity between work’s value and its returns when a nurse with over 30 years’ experience is paid exponentially less than even the bonus given to a male banker after his excessive risk-taking caused billions of pounds’ worth of financial loss. Is it prudent to trust the economy to reward ‘individual output’ in an objective way? I would argue ‘no’.

Using a gender lens to analyse economic policy is a useful tool that can highlight its inherent underlying biases. This brings to the forefront the importance of questioning the rationale which posits austerity as the best means of guaranteeing future economic stability. Importantly, it shows how austerity breeds inequality by further entrenching gender, class and racial disadvantage.  

The economic recession in 2007/2008 was not only caused by the excessive risk- taking of workers in the financial sector — it was also driven by inequality. Widening inequalities, a fall in wages and the consequent lack of demand for commodities and services, also contributed to the crisis. Austerity is simply widening inequality and contributing to instability. If we are to strive for greater fairness in our society — and in doing so reduce the risk of a future economic crises —  policy-makers need to place social and economic welfare front and centre in their thinking.  Non-orthodox, feminist economists propose alternative measures for long-term stability, they argue that work needs to be valued appropriately and wage inequality must decrease. They propose the ‘radical’ notion that the economy should work for society rather than the other way around.

The first step towards a more equitable society could be the simple one of including women’s voices in economic discussions. A recent study by the Fawcett society shows that 80% of newspaper articles on the economy have a male bias in terms of people referenced, spoken to and quoted. If women aren’t included in the discussion we cannot expect to achieve equitable progress any time soon. If these issues do not enter society’s conscience and policy continues to be blindly guided by orthodox economic rationale, we will likely see the continuing adverse effect of economic policy on women, the poor and minorities nationwide.

Author: Gender + the City

Intersectional Feminist digital magazine

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