I wrote about the doctor's strike yesterday and concluded that:
It is not about doctors' desire for better pay in isolation, although they are worth it. This is about an economic system that is on the precipice of collapse. This strike is a sign of things to come.
In a world that does not care about younger people and their ability to survive the economic and other demands being made of them, I suggested that the economy might well be closer to collapse than most people think, and most definitely than the government thinks.
Last night, the FT published a new article by its data specialist, John Birnn-Murdoch. In it, he suggested that:
One of the most striking but under-discussed insights from this year's World Happiness Report was that the marked worsening in young adult mental health over the past decade is primarily, if not exclusively, an Anglosphere phenomenon.
As is his style, he used charts to illustrate his point. This was the first:
Stress is more common in the Anglosphere than elsewhere. UK data is remarkably close to the average, except when it comes to the 60+, when we are easily the highest.
We are worse off than Europe at all ages. The elderly here are worse off than. anyone. We worry more. Put that down to pensioner poverty, I suspect. And our young people worry more than those who are older do.
House prices contribute to this:
Young people feel priced out of a society in which they are denied the chance to be a part. There is no other way to explain what is happening. Of course, they feel alienated as a result. I suggested yesterday that this is one cause of the doctor's strike, and I am sure that this exploitation is a significant cause of social disquiet now.
But there is more to it than that. There is also the lack of opportunity:
The belief that you had a fair chance by working hard is disappearing, and rightly so, because it is obvious that the odds are being heavily stacked against young people now. Their perceptions match reality.
The question is, what to do about this?
One obvious answer is to massively increase the supply of social housing. As was true in 1918 and 1945, nothing probably matters more now. Unless you can provide people with security to live in communities where they know they can settle for the long term, they will not flourish. What is more, they will know that, and their reaction is to reject the society that offers them no hope.
Is Labour doing enough in this? No, not at all. And recently, it was reported that it has caved in to exploitative landlords, including the Duke of Westminster, yet again. The description of the creation. of wealth divisions in society that I discussed in the fourth in my wealth series is being proved right again.
So, massive lease reform and social housing have to happen.
But so too does redistribution. This is why what I wrote in the Taxing Wealth Report matters. A wealth tax will take forever to deliver, and we do not have time to wait for change. People are suffering as a consequence of inequality now.
And, I do mean suffering. There are very real mental health consequences from the exclusion of young people. society, housing and hope.
And if our politicians cannot see that and cannot be radical in response to the demand for change that gives rise to, they are simply not up to meeting the needs of the society we live in.
And once again, I mean needs. The rich have their wants satisfied. Too many young people now cannot meet their needs. Their wants do not come into it. And that is the crisis that we face.
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Building more social homes is necessary but not sufficient.
There must also be an end to Right to Buy – as proposed by the Green Party – which obliges councils to sell houses at a large discount. That would still allow councils to sell council houses at their own discretion.
And the Land Compensation Act, 1961 must be repealed. It requires land prices to include “hope value”, which must be included in compulsory purchase orders and inflates their value. Its repeal would allow land to be compulsorily purchased at existing use value.
Those changes, plus the government resolve to build more social houses in total number and as proportion of the number of all houses built, are required to meet this urgent need.
Agreed
“Theor perceptions much reality.” Meaning?
Edited.
Sorry.
Writing before my first coffee.
All my three children ( 42 -51 ) own their own homes.
I am doubtful my grandchildren will be able to do the same.
We are going backwards but it is not inevitable. We need the map (like this blog) and people who can make things happen.
It may be more acute here and in the USA but it is a problem for the western world and the answers will be similar.
Agreed
And if they can’t own their own, social housing is vital.
As the parent of two such young people I can heartily agree. And although I would never even underestimate any of them, it is really tough out there.
As I began to read your article, Richard, my immediate thought was that housing is a basic need and that we need more social housing. Therefore, when I got to your comment about the need for more social housing, unsurprising, I have to say I couldn’t agree more.
As I have previously said, there are demonstrably successful social housing schemes employed elsewhere, e.g., Vienna. However, more fundamentally, when you look at the demographics and wealth distribution it is clear that we NEED much more social housing. The nonsense spouted about affordable housing being built as part of a planning requirement is simply that…nonsense. It simply fails to recognise we need more social housing. Fiddling round the edges just doesn’t cut it.
Before I pass further comment, I should say that for those who wish to do so, buying a house should be an option. The demographics suggested that this should be more aligned with the German / Swiss models where c.70% rent rather than buy. However, fundamentally, we need more social housing.
For what it is worth, I grew up in a council scheme. Whilst we were – what would be described today as – poor, we didn’t grow up feeling deprived (and I didn’t recognise or think of myself as poor because I was loved and everyone nearby was in a similar economic situation). Neither did I grow up with anxiety, etc. When council housing was privatised and my mum was offered to buy her house for what was a ridiculously small sum of money, she refused to buy – even though I could have easily given her the required money there and then and it was clear how much more she could then sell it on for. Why? Very simply, her view was that it would be a house less for someone who needed it when she died (which was at the time expected to be a long way off, over 20 years if she lived to average life expectancy). She had no interest is making money ((at the time it could be bought for £16,000 and sold immediately for upwards of £75,000….nowadays the same house is well over £300,000) as she recognised that it provided a basic need for someone who could only afford social housing and give them the chance to bring up their family. Obviously I’m biased towards my mum, however, morally she is way above the rentier class and economically she is way ahead of our current crop of politicians who seem in thrall to the neoliberal wealth extractors. Incidentally, partly because we lived in an affordable council house, I was able – having secured a bursary – to be the first in my family to be able to go to university (despite my mum having been dux she couldn’t afford to do so). My daughters have subsequently graduated with one doing a PhD. Social housing – in part – enabled this (as did full university funding). The largely unaffordable housing in this country simply exacerbates many of our other problems: demand on NHS; poor levels of well-being; the young being saddled with enormous debt from university costs; poor social care, etc.
Spot on. My background is similar to yours. I was brought up in the fifties in the North East of England in a council house. In terms of material goods we had little- no white goods, no car, no central heating, but as you say everyone else was the same so there was no feeling of poverty, despite the fact that only one parent worked. We had enough to eat and my mother cooked on an open range which also heated the living room. I do not wish to present this as some golden age because there were problems, as I realise now. My mother’s severe asthma was probably caused by the atmosphere from the coal fires, for instance. However I did grow up feeling absolutely secure. My parents had security of tenure and were never afraid that they could lose their home. the back door was never locked because everyone knew everyone else and nobody had much to steal anyway. It would have been so unthinkable anyway to steal from a neighbour that burglary was never a cause for anxiety.
75 years later and we are where we are, with a housing, employment and mental health crisis affecting the young to such an extent that the birth rate is falling dramatically. What happened? Do you remember how Tony Blair would talk about building ” a stakeholder society”? We have ended up with one in which far too many of the young have no stake at all. And that is dangerous, as current political developments are showing. Why has it happened? At least in part it is due to the forgetting of the economic lessons our parents learned so painfully through recession and world war and I lay the blame for that on Thatcherism and the subsequent rolling back of the Welfare State. Her principle policies of selling off council houses and reducing the role of the unions in our economy are coming back to bite us now in the form of costly insecure housing and low paying insecure work. And when people become desperate and insecure they are prey to the siren voices on the right telling them it is all the fault of the foreigners…….
Thank you and a great deal to agree with.
Spot on
I may have mentioned here before that a few years after I moved to France I was surprised to hear a discussion of economics on French radio using the term ‘anglo-saxon’ to mean ‘neoliberalism’. There, I think, you have the explanation for the relative unhappiness of the anglosphere: it’s an index of the extent to which their economies have been run on neoliberal lines. Nowhere has escaped this plague entirely, but some have escaped more than others.
That’s a fair summary
It is interesting that you mention the Happiness Index, because the country in the world that has been top of that index for several years is Finland.
And guess what.
Finnish system for affordable social housing supports social mixing and brings down homelessness.
https://www.kuntarahoitus.fi/en/news/finnish-system-for-affordable-social-housing-supports-social-mixing-and-brings-down-homelessness
Now, I’m no expert on Finland’s housing policy, but it looks like they are doing something right.
Also, I didn’t know, Finland has the right to housing enshrined in the Finnish constitution.
I’m sure thay have some problems, but they are making an effort to provide the most basic of need. Puts the UK to shame.
In fact, all of the countries at the top of the Happiness Index, Scandinavian, have higher tax rates and high quality public services.
https://factsontaxes.com/how-are-scandinavians-the-happiest-countries-when-they-pay-hefty-taxes/
They also get education right
Given so much housing inequality, it strikes me as particularly … anything from ‘unfortunate’ to ‘wicked’ – that although more houses and apartments are being built, a lot of them are bought solely for investment, indeed in some cases are specifically marketed as such to overseas investors. In an ideal world I’d prevent any homes, perhaps any real-estate at all, being sold to non-resident non-taxpayers. But that’s not the world we live in.
Here in Devon many new builds have ‘Sold’ signs up quickly but then these are followed by ‘To Let’ ones shortly afterwards.
What matters is to understand the underlying causes, because if we do not, then the errors will be repeated, to the detriment of future generations.
Yes, neoliberalism and Maggie Thatcher started the process of financialising everything, as did Reagan in the USA. But the real damage was done by Dr Alan Greenspan when he opened the credit floodgates wide in October 1987. Since then, politicians have rushed to “solve” every financial crisis by creating more credit.
Much of that credit has flowed to “asset manager society” (the term used by Prof. Brett Christophers) to be used, as debt, to take over public sector monopolies and some near-monopoly private sector businesses, assets strip them, apply financial engineering tactics to extract rewards from captive customers, etc. For example, Macquarie forced Thames Water to borrow from the parent company at high interest rates – see https://www.bbc.com/news/business-41152516
The UK – in common with other anglosphere countries – has allowed these tricks to flourish, and even encouraged some (e.g. stimulus schemes for house purchase; higher pricess do not create extra resources, just price the young out of the market unless they pay a high fee to the old).
I worry that the coming financial crisis will be tackled the same old way, with more credit, thereby adding to the private sector debt burden and further stressing and alienating people. The right way would be to let some banks and financial businesses go bust. There are many parasitical such businesses.
Unfortunately the reports that Reeves might legislate to reverse any Supreme Court ruling upholding the ban on the car loans commission scandal is a very bad sign.
Richard, this is why I asked you about the proportions of private sector lending originating from the bank credit multiplier and MMT, which you could not answer. There are worrying signs that the policy error of expanding credit and stuffing people with more private sector debt
will be repeated.
Private sector debt is the real issue, without a doubt.
Excellent and thank you!
(If we now have to work into our 70s we will be taking young peoples jobs. )
This just shows that Lord Layard simplistic analysis of mental health as a disease to be cured like measles, is another part of the failed neoliberal experiment.
Layard has a lot of influence but not the imagination of Professor Murphy- who understands that well being is influenced by context. If people, have no security, no hope, no power, they become anxious, depressed, aggressive, and suicidal.
Layard seems to understand that GDP is not a good metric for a country’s functioning, he promotes a happiness metric, he must understand structural inequality is bad for us, but somehow his answers don’t engage with the huge data about inequality impacts,
Nor does he explain why IAPT did not ‘cure’ us our poor mental health, nor explain why we are more affected than other more equal nations, as shown by Prof Murphy.
What we have in UK is a Factory of Therapy, another neoliberal lie that’s too big to fail, where even the therapists can feel trapped and suicidal.
Rarely add links sorry if a bit long.
https://www.newvisionformentalhealth.com/tag/cbt-watch/
https://www.bps.org.uk/psychologist/challenge-layard-initiative
https://criticalmhnursing.org/2017/01/23/the-layard-report/
It is 20 years sicne I read Layard so I asked ChatGPT to remind me of what he said and got this, whioch confirmed all I recalled, and especially his association with CBT:
In his influential 2005 book Happiness: Lessons from a New Science, Layard argued that:
⸻
The Cure to Unhappiness Requires:
1. Prioritising Mental Health
• Layard famously advocated that mental illness—especially depression and anxiety—is one of the largest causes of misery in rich countries.
• He argued that access to talking therapies, like Cognitive Behavioural Therapy (CBT), should be massively expanded on the NHS.
• This led directly to the Improving Access to Psychological Therapies (IAPT) programme in the UK.
2. Reframing Economic Policy
• He challenged the idea that more money leads to more happiness once basic needs are met. Beyond a certain income threshold, relative income (how we compare to others) matters more than absolute income.
• Layard proposed that governments should aim for well-being, not just GDP growth—a radical shift in economic priorities.
3. Promoting Social Connection and Purpose
• Layard argued that strong social relationships, trust in society, and purposeful work are more important to happiness than higher income or consumption.
• He was a strong critic of status-driven consumerism, seeing it as a race that makes everyone worse off.
4. Teaching Life Skills
• Layard advocated for teaching social and emotional skills in schools, through programmes like “Life Lessons,” to equip young people with the tools for mental resilience.
⸻
In Summary:
Layard’s “cure” for unhappiness is not to get richer, but to invest in mental health, reduce inequality, foster social connection, and reshape policy to promote well-being. As he put it:
“Happiness comes not from getting richer, but from relationships, purpose and peace of mind.”
As you note, he says mental ill healoth is a big issue, but makes the answer personal, ignoring that the issue is systemic. All rather neoliberal really, bit he was and maybe still is a Labour peer.
That’s it! systemic problems are for powerless individuals to solve, and if you can’t, it’s your fault. It’s sinister, as is the highly profitable CBT industry. See CBT watch.
His influence has been huge and what’s great about FtF is how the relationship between economics and mental health is being reset. 🙂
His latest book is worrying.
https://www.theguardian.com/books/2020/jan/23/can-we-be-happier-richard-layard-review
CBT cannot solve neoliberalism’s problems. It cannot solve domestic violence and marital conflict, that’s just bonkers.
Layard claims to understand the significance of family and relationships to health, but ignores the usual therapy for relationships- systemic family and couples therapy, but then he likely wouldn’t appreciate a therapy which believes problems lie in systems not people and is interested in power, context and the wider system around the problem.
And yes you’re right he is a Labour peer.
Layard is another of the world’s profoundly confused men. Like so many economists, he confuses the map and the terrain, thinking that happiness is something real, that can be measured, and which can be attained by direct effort, when none of that is true.
The reality is that happiness is an epiphenomenon of a life lived well, and if the opportunity to live life well is denied to someone then the likelihood that happiness will be achieved is incredibly low.
In the world in which we live, that opportunity to live well is very frequently denied, starting most especially with the denial of the opportunity to have access to stable and secure housing, with everything else following on from that, including the opportunity to invest in personal skills that will be valued by the community in which a person lives.
Happiness is not independent these things. It is entirely dependent upon them. Layard, by pretending that happiness is discrete and separate, completely misses the point.
He also does harm because he, I think quite deliberately, seeks to blame the individual for their unhappiness when that is utterly unjustified in what, I suspect, is the vast majority of cases.
I having been reading your blog for a few years since I retired and for the first time felt I needed to contribute as this article so accurately reflects my lived experience.
My 90 year old mother is living very happily in her own house that is worth at least £500k, my siblings and I are all living in our own homes (mortgage free) but of my mothers grandchildren, 3 are living in rented social housing with the only one who has managed to buy a home doing so under a Scottish Government part ownership scheme.
None of her grandchildren are likely to be in a position to buy a home in the near future unless they can inherit from their grandmother a contribution toward a deposit. But this is looking less likely as her house may be need to be sold to cover care home fees fairly soon.
They may then have to wait until they inherit from their parents and personally I have to hope that is a good few years away!
All are between late 30s and mid 40s and have children of their own so as things stand I truly can’t see how my grandchildren who are in their teens are likely fair if their parents are struggling now.
Hard work is not paying off for my children or their cousins who all have jobs that in the past would have ensured a comfortable life but that is certainly not the case.
I do what I can help but until there is a shift in values to a more sharing society I can see things will only get worse.
Many thanks for your comment
Yup, when the base layer, the foundation layer of security has been ripped from underneath their feet the young must feel as though they are trying to climb a dune. One step forward, two steps backward