European anti-politics: reading the runes in Italy and Germany

The success of the Pirate Party and Italian comedian Beppe Grillo is symptomatic of our times.

There is no denying that the electoral results in France and Greece last weekend will have a significant impact on European politics in the short- term. But to get a picture of how things will look further into the future, it may be wise to pay attention to two rather more minor elections that took place this weekend.

The poll in Germany’s Schleswig-Holstein region not only signalled danger for Angela Merkel’s ruling coalition; it also confirmed the establishment of a significant protest movement – the Pirate Party. Meanwhile in Italy, surprisingly high levels of background support for Mario Monti’s technocracy have combined with the emergence of a populist comedian, Bepe Grillo, as a serious political figure.

These developments, diffuse as they may seem, are intimately linked. They point to a growing backlash against the mainstream parties (also in evidence in Greece), but this backlash is not just about disappointment in the parties’ handling of the issues of the day – austerity, growth and the rest. It is tied to the long-term emergence of an anti-political culture that places a potentially dangerous amount of faith in supposedly “neutral” solutions to political problems.

In Germany, the Pirate Party runs on a platform of abolishing copyright restrictions and radically opening up access to information. Their manifesto is a challenge to the old way of doing things – they want to end what they call the “principle of secrecy” and usher in a new era of transparency that allows citizens to interact with government in an entirely open information system.

But in making this claim, the Pirate Party reveals its troubling belief that representative politics can essentially be replaced by technology. Their own method for formulating policy uses an online platform called Liquid Feedback, which allows members to formulate and vote for proposals – the most popular policies eventually make it into the manifesto. The implication is that this supposedly non-hierarchical structure is how politics in general should work. It is as if citizens – left to their own devices and without the interference of traditional parties and the state apparatus – would be able to reach entirely uncontroversial policy decisions.

But this process neatly avoids the question of how executive power is wielded in such a radically open political system – indeed, evidence suggests that certain members of the Pirate Party are rather more equal than others when it comes to policymaking. And it entirely circumvents the age-old democratic problem of how to protect minority rights in a majoritarian system.

The Pirate Party’s success in Schleswig-Holstein this weekend is symptomatic of wider changes in the way citizens are coming to view democratic processes. The belief that technology provides a route to “neutral”, uncontroversial policy decisions is linked to a more general lack of faith in the traditional toolkit of representative politics – values-based partisanship, interest representation and the political skills of negotiation and compromise.

Further evidence of this move towards anti-politics can be seen in the results coming out of Italy. Much of the media has tended to frame this weekend’s local elections as a chance for Italians to show their frustration with the Monti regime. But in fact it is impossible for Italians to vote against Monti’s government, for the simple reason that the government is unelected. Granted, lower poll numbers for the mainstream parties which shore up the technocracy may be an indirect indicator of dissatisfaction, but the fact remains that the government is once-removed from political accountability.

What the election results really show is a rejection of the mainstream parties in favour of a comedian running on a fervently anti-political platform. Beppe Grillo’s Five Star Movement plays on people’s distrust of politicians, proposing to give "the entire public the role of government and guidance normally attributed to a few". Grillo’s success in these elections is a marker of the disrepute into which Italian representative politics has fallen. When this is combined with surprisingly high levels of support for the technocratic government, the trend is clear: people are increasingly inclined to believe that there are non-political, neutral solutions to political problems. Whether these solutions come in the form of a finance-oriented technocracy or a comedy-oriented populist, the point is that the answers to Italy’s economic and social problems are seen as having little if anything to do with democratic politics.

The scenes from Paris over the weekend were a timely reminder of what real democratic politics can be: a contest between different conceptions of how society should be organised, and a means of mobilising large numbers of citizens to take a role, albeit limited, in their own government. The danger is that such exhibitions of the value of representative democracy will become fewer and farther between.

William Brett is a PhD candidate at UCL and a research assistant at the Centre for Financial Analysis & Policy.

The German Pirate party leader Bernd Schloemer. Photograph: Getty Images.
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Q&A: What are tax credits and how do they work?

All you need to know about the government's plan to cut tax credits.

What are tax credits?

Tax credits are payments made regularly by the state into bank accounts to support families with children, or those who are in low-paid jobs. There are two types of tax credit: the working tax credit and the child tax credit.

What are they for?

To redistribute income to those less able to get by, or to provide for their children, on what they earn.

Are they similar to tax relief?

No. They don’t have much to do with tax. They’re more of a welfare thing. You don’t need to be a taxpayer to receive tax credits. It’s just that, unlike other benefits, they are based on the tax year and paid via the tax office.

Who is eligible?

Anyone aged over 16 (for child tax credits) and over 25 (for working tax credits) who normally lives in the UK can apply for them, depending on their income, the hours they work, whether they have a disability, and whether they pay for childcare.

What are their circumstances?

The more you earn, the less you are likely to receive. Single claimants must work at least 16 hours a week. Let’s take a full-time worker: if you work at least 30 hours a week, you are generally eligible for working tax credits if you earn less than £13,253 a year (if you’re single and don’t have children), or less than £18,023 (jointly as part of a couple without children but working at least 30 hours a week).

And for families?

A family with children and an income below about £32,200 can claim child tax credit. It used to be that the more children you have, the more you are eligible to receive – but George Osborne in his most recent Budget has limited child tax credit to two children.

How much money do you receive?

Again, this depends on your circumstances. The basic payment for a single claimant, or a joint claim by a couple, of working tax credits is £1,940 for the tax year. You can then receive extra, depending on your circumstances. For example, single parents can receive up to an additional £2,010, on top of the basic £1,940 payment; people who work more than 30 hours a week can receive up to an extra £810; and disabled workers up to £2,970. The average award of tax credit is £6,340 per year. Child tax credit claimants get £545 per year as a flat payment, plus £2,780 per child.

How many people claim tax credits?

About 4.5m people – the vast majority of these people (around 4m) have children.

How much does it cost the taxpayer?

The estimation is that they will cost the government £30bn in April 2015/16. That’s around 14 per cent of the £220bn welfare budget, which the Tories have pledged to cut by £12bn.

Who introduced this system?

New Labour. Gordon Brown, when he was Chancellor, developed tax credits in his first term. The system as we know it was established in April 2003.

Why did they do this?

To lift working people out of poverty, and to remove the disincentives to work believed to have been inculcated by welfare. The tax credit system made it more attractive for people depending on benefits to work, and gave those in low-paid jobs a helping hand.

Did it work?

Yes. Tax credits’ biggest achievement was lifting a record number of children out of poverty since the war. The proportion of children living below the poverty line fell from 35 per cent in 1998/9 to 19 per cent in 2012/13.

So what’s the problem?

Well, it’s a bit of a weird system in that it lets companies pay wages that are too low to live on without the state supplementing them. Many also criticise tax credits for allowing the minimum wage – also brought in by New Labour – to stagnate (ie. not keep up with the rate of inflation). David Cameron has called the system of taxing low earners and then handing them some money back via tax credits a “ridiculous merry-go-round”.

Then it’s a good thing to scrap them?

It would be fine if all those low earners and families struggling to get by would be given support in place of tax credits – a living wage, for example.

And that’s why the Tories are introducing a living wage...

That’s what they call it. But it’s not. The Chancellor announced in his most recent Budget a new minimum wage of £7.20 an hour for over-25s, rising to £9 by 2020. He called this the “national living wage” – it’s not, because the current living wage (which is calculated by the Living Wage Foundation, and currently non-compulsory) is already £9.15 in London and £7.85 in the rest of the country.

Will people be better off?

No. Quite the reverse. The IFS has said this slightly higher national minimum wage will not compensate working families who will be subjected to tax credit cuts; it is arithmetically impossible. The IFS director, Paul Johnson, commented: “Unequivocally, tax credit recipients in work will be made worse off by the measures in the Budget on average.” It has been calculated that 3.2m low-paid workers will have their pay packets cut by an average of £1,350 a year.

Could the government change its policy to avoid this?

The Prime Minister and his frontbenchers have been pretty stubborn about pushing on with the plan. In spite of criticism from all angles – the IFS, campaigners, Labour, The Sun – Cameron has ruled out a review of the policy in the Autumn Statement, which is on 25 November. But there is an alternative. The chair of parliament’s Work & Pensions Select Committee and Labour MP Frank Field has proposed what he calls a “cost neutral” tweak to the tax credit cuts.

How would this alternative work?

Currently, if your income is less than £6,420, you will receive the maximum amount of tax credits. That threshold is called the gross income threshold. Field wants to introduce a second gross income threshold of £13,100 (what you earn if you work 35 hours a week on minimum wage). Those earning a salary between those two thresholds would have their tax credits reduced at a slower rate on whatever they earn above £6,420 up to £13,100. The percentage of what you earn above the basic threshold that is deducted from your tax credits is called the taper rate, and it is currently at 41 per cent. In contrast to this plan, the Tories want to halve the income threshold to £3,850 a year and increase the taper rate to 48 per cent once you hit that threshold, which basically means you lose more tax credits, faster, the more you earn.

When will the tax credit cuts come in?

They will be imposed from April next year, barring a u-turn.

Anoosh Chakelian is deputy web editor at the New Statesman.