This week saw more clamouring for financial support for those struggling to survive on government handouts. Our indulgent government has created ideal conditions for the cobra effect.
The cobra effect describes an attempted solution to a problem resulting in the opposite of what is intended and making the problem worse.
Unintended consequences and perverse outcomes happen when money is spent indiscriminately, emboldening the desperate and greedy to take advantage.
“Economist Horst Siebert coined the term “cobra effect” based on the following:
When the British ruled India, the city of Delhi was infested with cobras. To enlist the public’s help in eradicating the snakes, officials offered a bounty on cobra skins.
Soon, however, a cottage industry of cobra farming sprang up. People were breeding them for their skins. The British paid out more and more money, but the cobra infestation did not abate. And cobra farming only added to the problem.
When authorities finally got wise to the scam and withdrew the bounty, the farmers set their now-worthless cobras free. In this case, truly the road to hell was paved with good intentions – and cobra skins.”
Psychology Today
Consider the cobra effect on beneficiaries whose numbers are increasing, justifiably rising by 12% during April last year which was the highest increase in 24 years. But if treasury predictions are correct, numbers will continue rising to 16.2% of the working population, eclipsing the 12.4% following the Global Financial Crisis.
Why? Beneficiary numbers should begin to drop after many businesses have resumed. Is the slow return to business as usual keeping numbers high, or is the cobra effect kicking in because people choose not to work?
Access to beneficiary funding is available to 16 to 20 year olds through the Youth Payment or Young Parent Payment. Their access to cash is strictly controlled by the state, who first make payments such as rent on their behalf, but this week saw a push for this to change.
Advocates against poverty want youth to control the spending, saying restrictions can lead to young people feeling “disempowered and stressed”. And, of course, if young beneficiaries blow their money they can apply for a hardship grant to buy the necessities.
If a beneficiary or child needs braces, no problem, the government hardship grant can fund it; if the washing machine stops working, no problem, Work and Income will pay for another or alternatively loan the money to be repaid over time by deductions from their benefit.
The cobra effect is evident in the skyrocketing number of applications for hardship grants.
The children of beneficiaries receive free school uniforms, breakfast, lunch and period products.
Of course, poverty is not the child’s fault, but the taxpayer is paying for the indiscriminate spending to hide the stench of poverty.
Period products will be made available in all schools from June, and this week Newshub’s Duncan Garner demanded free lunches for all school children regardless of whether they need them or not, backed by the Children’s Commissioner, Andrew Becroft.
The video attached to Garner’s report clearly demonstrates the purpose of free lunches for all is simply to smother the unwelcome stench of poverty with feeding hungry children a secondary motive. Lunch for all school children is not a need, it is a nice to have – if you can get it.
Single income families are poorer; single parent households comprise 30% of our families and their numbers are expected to rise to 40% in the 2030s.
Staying alive in New Zealand has never been easier for the indolent and the gangs thriving in a culture of poverty that breeds lawlessness.
A report this week claims poverty ridden Venezuelans survive on smuggling, illicit trafficking and other forms of criminality as the country is gradually turning into a land of militias, warlords and criminal gangs dividing the country into fiefdoms out of the reach of state control.
Gangs who provide illegal income for beneficiaries are protected from public scrutiny by politicians perpetuating the cobra effect.
‘El Loco Woko’ campaigns for higher beneficiary payments.
“We know record numbers of families are needing hardship grants to survive. Many people are being put into debt with Work and Income and other loan companies in order to meet basic expenses.
The end result is people growing with health conditions that are preventable, people not being able to pay their rent and ending up in emergency housing.”
Newshub
Gang hugger Marama Davidson campaigns for a softer approach toward gangs, supported by the Human Rights Commissioner Paul Hunt.
Davidson tweeted that gangs were part of “diverse communities, who have been subject to enduring and systemic racism”, while Hunt was reported as saying “rhetoric about being tough on gangs is stigmatising”.
Newshub
Ministers of the Crown empowering gangs tears at the very fabric of decent society. MP Simeon Brown links the death threats he received this week to his criticism of Davidson and Hunt’s visit to the Hamilton Mongrel Mob.
“A Minister of the Crown going to their gang pad not only gives them only credibility, but emboldens them in terms of what they’re trying to do in our community. I find that absolutely shocking.”
MP Simeon Brown
Brown is not alone in being shocked by Davidson’s extraordinary behaviour.
Nonsense about accepting gang culture as part of “diverse communities” and addressing “enduring and systemic racism” is wayward thinking worsened by entrenched indiscriminate spending which, if the last week is anything to go by, will inevitably worsen .
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