Frank Greenall: Mike Moore and the trade vs aid dilemma

Former Labour Prime Minister, the late Mike Moore.

Last weekend saw the passing of long-time stalwart Labourite and short-time Prime Minister, Mike Moore - recognised by most for his humanity, humour and astuteness.

He distinguished himself in his tenures as Minister of Trade for the fourth Labour Government, and World Trade Organisation Director-General, where he was cheerleader for free trade.

This ruffled feathers of many Labour colleagues, who saw faux free trade as a Trojan horse for rapacious multinationals.

But Moore's mantra was that free trade beats aid every time.

To Moore, aid was merely stop-gap, but trade incentivised and rewarded self-reliance and skill-building. In essence, the old story about teaching someone to fish rather than just giving them a fish.

In Labour's chaotic run-up to the 1990 election, Moore's brief prime ministerial stint was such that his main priority was simply party survival.

Mike Moore ruffled feathers of many Labour colleagues, who saw faux free trade as a Trojan horse for rapacious multi-nationals.

But a longer incumbency would have seen him trailing the footprints of the other now iconic Labour Prime Ministers, Michael Joseph Savage and Norman Kirk, both proud champions for society's "battlers".

Yet had that been the case, Moore inevitably would have struck the same dilemma the current Labour-led Government finds itself in, grappling with the same issues that infuse both the free trade/aid debate and ramifications of the so-called "welfare state".

"Mickey" Savage saw his first Labour Government's social reforms as Christianity-in-action – very much in the "hand-up" as opposed to "hand-out" mould.

But while lauded worldwide for his initiatives, Savage would today be mortified at the extent of contemporary welfare pervasiveness. To him, benefits were strictly temporary assists for demonstrably deserving sober and willing-to-work citizens.

Such initiatives as State Advances mortgages made home ownership possible for hundreds of thousands.

But despite latter decades of relative prosperity and welfare expansion, wider society is bewildered at the scourge of general social dysfunction now at large, with attendant battalions of social agencies futilely trying to cope with the exponentially rising casualty lists.

Now we have the plight of the "working poor", where even double income families can no longer count on home ownership.

This sixth Labour Government is supposedly committed to turning all these accumulated negative social statistics around, but watches in dismay as the figures inexorably continue to rise despite injecting unprecedented government funding.

The question is why.

One telling factor is that the mid-last-century years were characterised by virtually full employment, but crucially also by housing and rental costs which didn't consume an extortionate percentage of household incomes.

Even a single modest income family could realistically aspire to basic home ownership.

For quite a few years I worked in low-decile socio-economic areas subject to every negative statistic going, and witnessed first-hand how the whole social welfare paradigm was often turned on its head.

For some, prospects for employment and home ownership were so slim, and the prospects for state agency financial assistance so much better, that the latter won every time. The incentive/disincentive equation had flipped.

Many families involved were hard-working, except they were officially unemployed. Most of their efforts now revolved around maximising available benefits, their "working" day centred on doing the rounds grappling with various social services.

In essence, they'd become hunter/gatherers, not foraging in forests and fisheries but the offices of social agencies.

The main downside to chronic dependency is the collateral damage that comes from long term disengagement.

Loss of confidence and self-esteem generate a dog's breakfast of mental health and social issues that inflame the situation.

It's a toxic downward spiral unless something is done to break it.

The most meaningful measure available is properly incentivised government sponsored work programmes that can stepping-stone the long-term alienated back into organic wider-society participation, initially through lower-skill jobs. Trades vs aid.

But sadly, it won't happen.

Both major parties are still captive to the fictional notion that only a mythical "free market" is able to ride to the rescue.

Even Trader Mike knew that there's no such thing as a free market.