Clegg's policy to take money from pensions to pay for mortgages is madness

It's housing market madness, writes the IEA's Philip Booth

It is difficult to think of a policy that is as ill-conceived on so many levels as the coalition's announcement on Sunday to allow parents to guarantee their children's mortgages.

Housing is unaffordable today not because buyers are unable to secure yet more credit against the value of their house but because supply is constrained. Not long ago, the average house would have changed hands for three-to-four times average earnings; today, the vast majority of buyers have to pay five-to-seven times average earnings. If you pump more finance into a supply-constrained system, there can be only one result - yet higher prices.

Views differ on the causes of the financial crash and how to deal with the problems that the economy faces today, but one reaction of the government has been to bind banks up in ever-more regulation. Whether that is right or wrong, it is a deliberate policy decision in order to ensure that banks do not fail at the expense of the taxpayer in the future. This has made banks more risk averse. The response by the government has then been to directly take on the risks that the banks have refused, through schemes such as funding for lending or the proposed business bank. This is a bizarre policy. Banks are constrained in their own business models in order to prevent them failing at the expense of the taxpayer and, instead, the taxpayer is now taking on the risks directly.

Clegg's proposal to guarantee mortgages with pensions is another such instance of incoherent policy. In addition to the regulation of bank's capital discouraging banks from risky lending, the FSA is increasingly trying to rein in the provision of mortgage finance at high earnings multiples or high loan-to-value ratios. The government's new proposal seems to work precisely in the opposite direction. Clegg seems to be reasoning that, if everybody can secure their debts on everybody else's assets, then everything will be okay. Is that not the logic that gave us the financial crash in the first place?

Even in terms of the practical details, Clegg's plan seems crazy. Any pensioner who has already reached the age at which they can take their pension is entitled to secure their children's lending on any lump sum they choose to keep as an asset. As such, this proposal is only relevant to future pensioners. If a potential pensioner secures their child's mortgage on a lump sum which legislation prevents them from accessing until at least age 55 what will happen if the child defaults on the mortgage?

Presumably, either the lump sum will have to be taken early - which will cause havoc in terms of the relationship between the lump sum and the rest of the fund which is strictly controlled to prevent tax avoidance - or some complicated contingent loan arrangement will have to be set up. This will all require reams of legislation.

Clegg might also want to ask how many prospective pensioners are so well pensioned that they would be happy to put their pension pot at risk in this way. And, in turn, how many of those prospective pensioners would not, in any case, have a house against which they (or their children) could secure an additional loan for their children if they were so minded?

This is a completely crazy policy which actually works against many of the other things that the government is doing (in some cases probably wrongly) to try to create a more stable financial sector. Parents with assets should have no trouble securing loans for their children if they wish to do so. If banks and parents wish to freely enter an arrangement whereby a pension lump sum is taken into account when negotiating a loan, then so be it - but let's not have the government specially encourage it. The fact that policy proposals in the housing finance area are becoming more and more bizarre ought to focus people's attention on the real problem - the affordability of housing. We cannot make housing more affordable unless supply can respond to demand. Some readers may object to the policy consequences of liberalising development restrictions. However, we should be clear about the housing affordability consequences of not doing so.

Mortgages are advertised in a Halifax window. Photograph: Getty Images

Philip Booth is Editorial and Programme Director at the Institute of Economic Affairs.

 

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Is "successful" sperm really the measure of a man's masculinity?

An advertising campaign challenging men to "prove your worth" is being proposed to increase dwindling numbers of sperm donors – will the myth that only "real" men have potent sperm ever die?

Are you a superman? By which I mean, do you have the kind of sperm that would be accepted by the UK Sperm Bank, currently stuck with only nine donors on the books? Laura Witjens, chief executive, is currently launching a drive to recruit more donors. Her secret weapon? An appeal to male vanity.

Speaking to the Guardian, Witjens claims that if she advertised saying, “Men, prove your worth, show me how good you are”, it would be a route to gaining “hundreds of donors”. The implication is that beta males need not apply; this is for “real” men only. And what better way to demonstrate one’s manly credentials than through the spreading of one’s super-strength, 100 per cent proof, ultra-potent seed?

The proposed campaign approach serves to remind us of two things: first, the male ego is ridiculous, and second, reproductive ability is still treated as an indicator of whether or not one is a “successful” representative of one’s sex. However much we claim that biology is no longer destiny, certain expectations linger. “Real men” have high-quality sperm and want to see it distributed as widely as possible. “Real women,” on the other hand, only end up unable to reproduce if they have “left it too late” (that is, spent too much time in what is still seen as the world of men).

That fertility is primarily linked to luck rather than sexist morality tales is something we’d rather not admit. After all, far too many cultural edifices have been built around the idea that the opposite is true.

For something that resembles runny PVA glue, sperm has done well for itself. Throughout history, men have been obsessed with their precious seed and what it means for their status as the dominant sex. Since it is women who get pregnant – women who perform the actual task of gestating and birthing new human beings – there has always been a need to inflate the importance of semen, lest men should be sidelined completely. Whereas for women reproduction is a continuous process, for men it is more disjointed and conceptual. Hence it is important to have something to rely on. In sperm we trust.  

Otherwise can a man ever be sure – really, really sure – that a baby is his? For biological mothers, maternity is never in question. For biological fathers, paternity needs to be established. There are various ways of achieving this: heterosexual marriage, compulsory monogamy, the policing of women’s sexual choices, the withholding of material resources from women in return for sexual exclusivity, the threat of an appearance on Jeremy Kyle.

And then there are the various myths regarding how magical and special your own sperm is. It had to be you, didn’t it? He shoots, he scores. How else would the phrase “Who’s the Daddy?” have come into its current usage? The “skill” of impregnation is linked to manliness. If you’re a real man, the implication is, then you’ve nothing to fear.

The “superman” theme proposed by Witjens harks back to the various ways in which men have sought to position themselves and their sperm right at the centre of human reproduction, believing, for instance, that it already contained human beings in miniature, or that women merely provided the passive matter that would bring their active principle to life.

The biology I learned at school still played on the narrative of the hardy, valiant sperm battling against all odds to reach the passive, if somewhat capricious, egg. Sex education met gender indoctrination; it even seemed to be implied that the egg, in closing off entry to all other sperm once the “victor” had penetrated her boundaries, was being a bit of a tease (she’d already set off down the fallopian tube, what did she expect?). Pregnancy itself, we were led to believe, could never match the creativity, risk and drama of that one initial shag.

To respond to such myth-making with “but it’s only sperm and actually it could be anyone’s” seems positively mean. Women are supposed to worship it. Our effluvia – vaginal discharge, menstrual blood, breast milk – might be seen as disgusting, but when it comes to a man’s cum, it’s considered rude not to want to swallow it. People who respond with outrage when a woman suckles her baby in a crowded café think nothing of the idea that a real woman should want to gulp down semen with gusto. Patriarchal semiotics tell us that what comes out of men is life-giving and hygienic; women, on the other hand – popping out babies and sustenance – merely leak. It takes a brave woman to say, “hang on, is semen really all that?”

In the UK at least, it would seem that it isn’t. According to Witjens, getting one’s sperm approved for the UK Sperm Bank is exceptionally difficult because of how strong the product needs to be to survive the freezing and thawing process: “If 100 guys enquire, ten will come through for screenings and maybe one becomes a donor. It takes hundreds of guys.” Meaning most men don’t actually measure up to “superman” standards (without even considering what this approach says to men with a low sperm count, of whom it is suggested that the manhood test has been well and truly failed).

Her advertising strategy may be one that works. But it would be nice if, in a society that increasingly favours a politics of acquisition over one of care, we could be a little less focused on the potency of the mighty seed, looking instead at this particular form of donation as part of a broader process of creating and caring for others. Perhaps appeals to male vanity just work better than appeals to altruism. Even so, it’s a pity that it has to be so.

The aftermath of sperm donation can be complicated. Once one gets beyond the cash and the ego trips, the process can lead to real children with a real need to know the identity of the donor. Whereas in the past social convention allowed men to define ownership of children on their terms, nowadays globalisation and reproductive technology have led to a splintering of roles. Is it care or biology that makes a parent? What is it that shapes an identity and makes a person?

For most of us, the humane position is that nurture – the act of being there – must trump any biological contribution. To think otherwise is unfair on those who devote years of their lives to the raising of children. But for many donor-conceived adults, the donor is still needed to complete the picture of who one really is. And he will not be a superman. He will be a person who gave something small that nevertheless contributed to the creation of something miraculous: a life. And shouldn’t that be enough?

Glosswitch is a feminist mother of two who works in publishing.