The report, "An Anatomy of Economic Inequality in the UK", came out in January 2010 in the period of the run-up to a general election at which Labour was desperately trying to cling onto their heartland support and produce clear red water between themselves and the Tories. But it is still useful and instructive reading. Although it mostly contained data that had been made available elsewhere, its focus on equality is worthwhile and it does draw all of the current knowledge on the state of equality in the UK into one place.
Income inequality
This graph tells a revealing tale:
To be fair to Labour, and this could be noted for much of their time in office, the most they sometimes achieve is a halt to the growth in the gap between rich and poor but not a reversal. Much of the reason they can do no more than that is down to the changes in the economy since the 1970s, with the transfer of productive industry to the power houses of east Asia. Further, structural unemployment has persistently remained since the late 1970s, effectively preventing any remedy through the labour market.
Labour has struggled to try and create conditions of social equality, but cannot and will not act against the very structures and systems that create it. It is like someone campaigning to mitigate the effects of slavery without trying to abolish slavery itself.
The report showed, but did not foreground, was that the top 1 percent of incomes got over £2,000 per week. Indeed, it is notable on the graph of incomes (below), that there is a sudden and noticeable spike at the top of the graph, reflecting the small number of people who have astronomical incomes. The spike is almost a qualitative shift between the vast majority on a rising continuum of incomes and the 3.3 million, out of a population of around 60 million in the UK, with a weekly income of more than £1,000 a week..
Figure S1: Equivalent net income, UK 2007-08 (at 2008 prices, before housing costs)
(a) Number of individuals with income in each range (millions)
Wealth inequality
The statistics on total wealth are worth noting as well:
‘Median total wealth (including personal possessions, net financial assets, housing and private pension rights) is £205,000. The 90:10 ratio is almost 100, with the top tenth of households having wealth above £853,000, and the bottom tenth having less than £8,800. The 90:10 ratio is so high because the poorest households have such little wealth. However, even looking more narrowly at the top half of the wealth distribution, those in the top tenth have more than 4.2 times as much wealth as those in the middle, twice the corresponding ratios for earnings or household income. 1 per cent of households has total wealth of more than £2.6 million.’
The authors of the report advocated reducing inequality. They addressed the various philosophies that claim that social inequality is necessary or even just. They maintained, though, that international comparisons of economic output do not correlate to great inequality, and claimed that some much less unequal societies than Britain are more productive and successful.
Further, although they noted that all the main political parties subscribe to ‘equality of opportunity’ (as opposed to equality of outcome), it is clear that the inequalities they discovered do not relate to life choices, but in fact reflected the cumulative effects of various advantages and disadvantages produced by background, and yes, class. Although most of the differences they highlighted were between different parts of what we would understand as the working class (anyone whose main economic asset is their ability to work) the conclusion that inequality at birth stays through life remains a stark and indefensible fact.
Despite the narrowing of wealth and income gaps towards the 1960s, the strength of wealth is back. Very telling was their revelation that the share of income for the top two thousandth of the population (the very, very, very, rich) is back to where it was in the 1930s. Since 1969 their share of income has trebled from 0.5 percent to 2.5 percent. For the top 1 percent they have gone from 4.7 percent in 1979 to 10 percent by 2000. Put another way, a century of Labour and Labour governments has not dented the power and wealth of those at the top of society. That, as opposed to any specific failure of the current Labour administration, is the lesson that socialists draw from this report’s findings.
For those who would deny that inequality is a problem, it must be sufficient to show that inequality in wealth, income and social status translates into a shorter, less healthy life, with less knowledge and personal development.
Since 2010 the report has been gathering dust in some corner of Whitehall, but as the BBC’s Mark Easton noted commented at the time:
‘The problem for the politicians is that measures to reduce social or income inequality will always be controversial because they mean neutralising the advantages of wealth – a prospect that those with money and influence will fight hard against’.
For us socialists, on the other hand, it is a weapon to show the rotten truth of our present system of society and a spur towards working to overturn it in its entirety.
PIK SMEET
No comments:
Post a Comment