Posts Tagged ‘inequality’

Andy Burnham’s ‘Aspirational Socialism’ should aspire to greater socialism

August 25, 2010

As I’ve said before, I like Andy Burnham. The leadership campaign has reinforced his ‘nice’ image and he’s also emerged as a bit more politically interesting than expected.

However, he still emphasises social mobility too much. The idea that aspirational people should be able to ‘succeed’ and ‘get on in life’ however poor their background is naturally appealing but my problems with it are:

  • Surely a truly socially mobile society would also see lots of people born to wealthy backgrounds fail due to their laziness or other personal inadequacy and end up becoming poor. None of the proponents of social mobility ever discuss this, which seems dishonest to me. No-one mentions removing the safety nets for the rich.
  • The focus on individual success makes me slightly uncomfortable as it reinforces too many right-wing political narratives. I understand that we have to utilise ‘common sense’ arguments in order to maintain widespread political appeal, but we shouldn’t forget that we are collectivists not individualists.
  • Social mobility is not inspiring as a long-term vision for the left because it assumes the retention of wealth inequalities in society. We can be more ambitious than simply helping ‘talented’ poor people escape poverty. We should commit ourselves to seeking the abolition of poverty altogether. Sincere egalitarianism should seek to remove class divisions rather than make them a bit more fluid.

Labour leadership youth hustings

June 12, 2010

Some Labour yoof obviously made up their minds very quickly. Before the event officially got underway an enthusiastic group of Milipedes (D) were trying to sign people up to the Shadow Foreign Sec’s leadership campaign. I, however, was undecided and without prejudice. Well, not quite, but I had enough prejudice and partiality towards each one of the candidates that I was refusing to identify myself as a supporter of anyone yet.

Soon enough we all sat down and the big five appeared. Clap clap clap. Questions were asked and answers were given. Ed Balls took the courageous decision to tell a room full of young Labourites that he wanted tuition fees scrapped. Unfortunately for Ballsy this imaginative attempt to come up with a policy that would distinguish himself from the others was diluted by just about all the other candidates joining his call for them to be replaced by a graduate tax (only Miliband D was hesitant).

The best question of the hustings came from a handsome young rogue in the audience who pointed out that the Tories are trying to criticise us from the left over the levels of child poverty and wider inequality in the UK today. The candidates were asked whether they thought the Labour Government had made mistakes in this area and how they would renew the party’s commitment to creating a more equal society.

None of the candidates gave entirely satisfactory answers. All of them – including Abbott – were too eager to spend time defending Labour’s record. This wasn’t the most efficient use of their one minute each since they were addressing a room full of Labour members familiar with the social gains secured between 1997 and 2010 and presumably disposed to giving their own party the benefit of the doubt.

We’ve got to be more honest with ourselves and potential leaders should cut to the chase when addressing party members. Labour failed to meet its own targets for child poverty reduction by 2010. The UK remains a country of inequitable wealth distribution and class divisions. Declaring that over 13 years Labour managed to just about stop the Thatcher-initiated trend towards greater inequality from getting much worse hardly makes an inspirational slogan. Not much of a moral crusade – and if we’re not a moral crusade we are…? 

The five MPs did admit that the Labour government maybe should have been more bold on redistribution. Stern criticism was then levelled at the policies of the coalition and at the decision of Frank Field to join them in their shamelessly sneaky efforts to reduce poverty by fiddling with the statistics. Clap clap clap. But this was easy, crowd-pleasing stuff. If I had been chairing the hustings I would not have allowed them to lay into the Con-Dem Government until they had first declared what kind of anti-poverty strategy they would want to implement.

To be fair, Ed Miliband did sound the most impressive when answering the question. He made clear that reducing the gap between the rich and the poor would be central to his leadership. Talking about the gap is definitely welcome – it’s a healthier egalitarian approach than relying upon the language of ‘social mobility’ or ‘equality of opportunity’. Miliband E also highlighted his support for a living wage and a high pay commission. Hopefully all of them will have more time to think about policies in this area over the next few months.

Another (more self-indulgent) question I would like to have been put to them is: We have two right-wing parties in government who describe themselves as ‘progressives’ and have even talked of imposing ‘progressive cuts’. If we are to provide the country with a strong opposition – a viable alternative – should we perhaps stop using this ideologically indistinct term?

Miliband D has claimed he wants this debate to include discussion around ideology. I agree. Talking about future Labour policy without reference to some sort of ideology programme would be bizarre. However, I also acknowledge that banging on and on about ideology at these sort of public events may not be helpful. It could make the party seem too inwardly focused and weird. Therefore, a simple one minute answer explaining what democratic socialism (it’s in the party constitution, they’re all signed up to it!) means in the 21st century would suffice.

You’ll notice that Andy Burnham is the only candidate who hasn’t been mentioned thus far in this report. Well, that’s because he failed to stand out. Apart from in terms of his accent of course. He didn’t seem to butt into the discussion to explain his own point of view as much as the others did. Maybe he’ll get louder in future events (though hopefully for Andy’s sake it won’t be an IDS-style ‘the quiet man is turning up the volume’!).

All in all, I walked off (to the nearest pub) with the view that I’ll probably first preference Ed Miliband. However, there is still a long time to go before any decision has to be made and I’m determined to remain open-minded. It’s all to play for, comrades!

Nowt wrong with being illiberal when necessary.

February 17, 2010

I’ve only just got round to reading yesterday’s Labour List interview with James Purnell, the former Cabinet member who keeps popping up in the media to remind us that he still exists and to try to prove that he’s a brainy hope for Labour’s future.  

In the interview Mr Purnell is talking about inequality and is asked to give his thoughts on the possibility of a High Pay Commission. He replies:

I think a cap on high pay would be illiberal and probably counter-productive. I think the idea of Government – or anybody – deciding what the maximum pay should be is too much of an interference in the ability of society and the market to run themselves.

I was somewhat surprised to see Purnell express distaste for “illiberal” measures. As Work and Pensions Secretary he spent much of his time promising to get tough on welfare claimants, talking about “penalising” people who did not try hard enough to find jobs, instigating crackdowns, etc.

And of course he was for many years part of a Government that pursued numerous policies decried in Guardian editorials as illiberal (i.e. ID cards, terrorist suspect detention without trial, ASBOs).

Some of these policies I support, some I don’t, but that’s not the point. When it comes to discussing Labour’s approach to economic inequality I think it’s a bit of a cop out to get scared of illiberal ideas.

If we are supposed to be socialists/social democrats (I suspect Purnell is very enthusiastic about the ideologically bland term ‘progressive’ and describes himself as such with great vigour) then this means we put the interests of the many before the few and shouldn’t get our knickers in too much of twist over illiberalism.

Being frightened of excessive interference with “society and the market” has meant that after many years of Labour Government we are still in a situation where a tiny percentage of the population own a hefty great chunk of the nation’s wealth while 4 million children are living below the poverty line.

If a Labourite wanted to convince me that a High Pay Commission would be a very bad idea, I would want to hear other, more practical arguments being put forward. 

For example, if a Government clampdown on high wages meant there would be a significant exodus of business talent and investment which would harm the UK’s economic performance then this would obviously make me think twice about the proposal.

Or if the Labourite produced some polling evidence suggesting that introducing the High Pay Commission would harm Labour’s electoral chances in key marginals then of course it would clearly be problematic.

But criticising the High Pay Commission idea as illiberal does not do the trick. It instead betrays a ridiculous lack of selfawareness considering the illiberalism that is accepted in other policy areas and it suggests a lack of genuine committment to tackling inequality.

I still find James Purnell thoroughly unconvincing.

Will Hutton on class.

January 11, 2010

Will Hutton had an eminently sensible article in yesterday’s Observer entitled ‘Of course class still matters – it influences everything that we do’.

For the distribution of reward and positions in today’s Britain does not mainly correspond to proportional talent, effort and virtue. It has been largely predetermined by the good luck of to whom and where you were born. There are 10 million men and women in work earning less than £15,000 a year; nearly all their parents were in the same position, as will be their children. There are nearly 3 million people of working age who do not even make themselves available for work, again reproducing itself through the generations.

Meanwhile, the middle and upper classes are becoming increasingly effective at ensuring that their children have the capabilities and qualifications to populate the upper echelons of the economy and society, what the great sociologist Charles Tilly called opportunity hoarding.

The good luck of being born into the right family is profound. Two American researchers, Betty Hart and Todd Risley, show how children from professional families hear on average 2,153 words per hour compared with 616 words per hour for kids in welfare families, so that by the age of three, there is a 30 million word gap between the vocabularies of children of families on welfare and those of professional families. On top, welfare children hear words of discouragement twice as often as they hear words of encouragement; children of professional families are encouraged more than 10 times more than they are discouraged. Don’t get born into a family on welfare in a council house.

The fact that our society remains so class-ridden after more than a decade of Labour being in power points to a fundamental failure of government policies. Even if discussions around class do form a central part of the general election campaign and Labour feel confident in the legitimacy of pointing out the connections between Cameron and Co’s wealthy backgrounds, their policy programme, and the Conservative Party’s historic role as the defenders of privilege, members of the government will have a hard time explaining why such little progress towards tackling inequality has been made over the years under their own watch.

It would have been interesting to find out what Hutton thinks should be done. He seems to be suggesting that private education plays a central role in perpetuating class divisions (I agree) but doesn’t come up with a strategy to actually address this problem. Likewise, whilst Hutton is speaking great sense when he points out how the opinion-shaping profession of journalism is dominated by the inequality-ignoring middle-class, he does not propose any sort of solution beyond “the media effort to close the conversation down as irrelevant should be resisted”.

Of course, Hutton had limited word space and he seems to think that simply starting a discussion is worthy in itself. But it’s not as if no one has ever written anything like this before. The columns of the Guardian and Observer have been graced with some eminently sensible articles about class for many years now. The mostly middle-class, left-leaning readers will nod their heads in agreement and will use the columnists’ arguments as another excuse to complain about New Labour (yes, something I’m guilty of as well!).

When will this awareness about class divisions and inequality actually get more people motivated to find out about what needs to be done, what sorts of policies could be implemented, and how they can try to force politicians to prioritise this as an issue? More attention needs to be given to concrete policy proposals to address inequalities and then people rallied behind them in support.

Certainties and uncertainties.

November 9, 2009

Tom Harris MP has written a post today about tax and inequality. Judging by all the question marks scattered throughout the piece, he seems to be uncertain about many things, especially the principal dilemma under consideration:

“How should a modern, left-of-centre political party which has been in power for more than 12 years respond to the growing gap between rich and poor?”

As well as this he asks questions such as:

“We know how to bring the richest down, but once we’ve done that, how do we use that money raised to benefit the poorest?”

“So why has incomes equality increased? And is it the inevitable consequence of a booming economy, as the UK’s was until the global recession started to bite?”

“More to the point, does anyone seriously believe that if the Tories instead of Labour had been in power since 1997, incomes equality would have been narrower than they are today?”

Some fellow Labourites may be concerned that a Labour MP and former government minister does not appear to have a very clear idea of why inequality in Britain has increased or of how it can be addressed. 

However, rest assured that Tom isn’t completely clueless! After all, he is very certain of some things:

“Tony Blair and – let’s not forget – Gordon Brown put a great deal of effort into reinventing Labour as a low tax party. As a result, we won three general elections in a row…”

There’s an element of truth here, of course, but if Tom’s above statement formed the basic argument of an A-Level politics essay on ‘Why Labour Won Three Elections In a Row’ I think it would be generous to give it higher than a B – grade.

One other very plausible explanation for New Labour’s electoral success during that period is that the opposition party were exhausted, divided, and correspondingly unpopular, making it relatively straightforward for Labour to retain power even as voters deserted it over the years. In a similar way, the polls today suggest a lack of widespread enthusiasm for the Conservatives but a collapse in Labour support makes a Tory victory seem sadly likely.

It could also be pointed out that Labour’s healthiest victories in 1997 and 2001 were won whilst promising some increased taxes – the Windfall Tax and the rise in National Insurance. At the heart of the party’s manifestos were commitments to increase spending on education and on the NHS.

So maybe Tom shouldn’t be so certain that ‘it woz low taxes wot won it’. Such a simple explanation, as convenient as it is for Tom’s view that taxing the rich is a bad idea, is not compelling.

I’m also far from convinced insisting that things would have been worse under the Tories or that growing inequality was probably an inevitable consequence of a booming economy is going to satisfy the concerns of those who care about economic inequality – many of whom are Labour activists and supporters and whose campaigning efforts will be needed to keep Labour MPs in office. 

Let’s give Tom credit. At least he is thinking about inequality and facing the difficult questions, even if it is depressing to see that he doesn’t have many answers about what to do and that there is apparently a lack of a ‘party line’ over inequality. 

Tom’s final demonstration of certainty is:

The Tories, of course, will be rubbing their hands in glee at the prospect of this debate within the party, and praying that we come down unequivocally on the “soak the rich” side of the argument. Personally, I’d rather we stay in government.”

But from the perspective of anyone who cares about inequality, what’s the point in keeping ‘us’ in government if ‘we’ have achieved such unsatisfactory results over 12 years, are not sure why this has happened, and have no idea how to rectify the situation in the future?

Personally, I’d rather Labour MPs like Tom started looking at how redistributing money from the rich to the poor can be done efficiently and effectively and then used all the influence they have to make sure the government is carrying out appropriate policies. He could look at providing free childcare, free school meals, raising tax credits and thresholds.

I’d rather they were doing this than demonstrating a total lack of direction over the issue of inequality (exasperating for Labour activists, I suspect), giving succour to right-wing arguments over taxing the rich (very pleasing for the Tories, I’d guess), and seeming to blindly prioritise re-election and the retention of power for its own sake (nauseating for voters in general).

Of that I’m certain.

Neglecting to address inequality would be an admission of defeat.

August 18, 2009

I like the start of Tom Harris’ recent post on Labour’s attitude to wealth:

THERE’S a terrific scene in the TV adaptation of Chris Mullin’s A Very British Coup in which the newly-elected left wing prime minister, Harry Perkins, is catching the train to London and is asked by a journalist: “Do you intend to abolish first class, Mr Perkins?” To which Perkins replies: “No, I intend to abolish second class. I think everybody’s first class, don’t you?”

Unfortunately it’s pretty much downhill from there.

Admittedly it was obvious that Tom Harris MP was not going to be outlining his own ideas of how to bring about a classless society. The title of the post (“Capping private wealth would be an admission of defeat”) kind of gave the game away. Tom is writing in emphatically New Labourer-than-thou mode.

As Sunder Katwala points out in a brilliantly thorough reply, Tom is perhaps even being more ‘New Labour’ than New Labour itself.

I hope Tom reads it. It is disturbing to see a Labour MP using the sort of language that gives succour to those who oppose all efforts to reduce material inequality in this country.

Taxation of the wealthy is “a necessary evil”. Compass’ call for a High Pay Commission is “dog whistle politics”. Government intervention in the market to dictate wages will apparently start leading to mass nationalisations. The post is tagged with “the politics of envy”. Exactly the same sort of stuff was said of the government’s decision to introduce the 50% income tax rate.

I’m not a fan of Compass and I don’t know much about how this High Pay Commission would work. Saying that, I’m not convinced that Tom does either. Calls to reduce income inequality should not be so blithely dismissed – even if the proposed methods of accomplishing this are not totally convincing.

It’s nice to see Tom – whose blog is No 1 in the ‘blogging MP’ category according to Toryboy Iain Dale – discussing policy. But surely he isn’t comfortable when right-wing bloggers are singing the praises of his hyperbolic denunciation of an egalitarian proposal. Surely not.

Why wealth matters

July 3, 2009

Over the past 12 years Labour has generally shied away from expounding on the subject of wealth, preferring instead to be seen to wish to “reward success” and focus efforts on giving aid to the worst off, rather than taking pops at the rich.

This wasn’t such a bad political strategy – especially in the 1990s, when, for good or for ill, we needed to do everything we could to convince the British public that we were able to accept the status quo in a society which fetishized great wealth.

But the way things are now, we need to focus on the issues that wealth and its present distribution present; both in terms of the way our political discouse takes place, and in the nuts and bolts of policy.

The first point is on the very different ways in which moral judgements are made about the rich and the poor. Consider the 50% tax rate. This comes via a particularly daft unreconstructed Thatcherite:

Economic think-tanks have already readily condemned the tax rise as pointless with the Institute of Fiscal Studies warning that the treasury’s predictions regarding the tax have a “very high degree of uncertainty” and many predicting that this could lead to an overall loss in government revenue rather than a gain with businesses simply moving abroad and many using loopholes to declare their income as Capital Gains.

Forget for a second that he’s simply wrong. Forget that there is no evidence to suggest that the 50% rate will have a negative tax yield (no matter what the Laffer-curve believing monetarist flat earthers think), and that very few of the extremely rich will actually leave the UK (most of them seem to like London, for some reason).

What’s significant here is a complete moral absolution of people who choose to arrange their affairs such that they avoid paying UK tax, and so drive up the tax that must be found from you and me. The wealthy are never – never, ever, ever – condemned for this sort of behaviour.

But the wealthy are not the only group in society against whom it is levelled that they arrange their work affairs so that they can maximize their own income – the unemployed are, if you believe the tabloids, very assidious about avoiding work and maximizing the benefits that they receive as a result.

The outcome here? Widespread and loud moral condemnation, of a sort that drowns out the calmer voices in debates about economc inactivity and work.

It’s clear to me, then, that – despite the fact that “economic rationality” is acting in the same way in each instance – the “public debate” holds that the poor have very strong moral duties to the rest of us which trump their economic self interest. The wealthy, on the other hand, have no moral obligations of any kind: they must simply carry on being splendid.

That this is the case has led to a deterioration in the way we think about wealth, poverty, inequality and social cohesion.

The second point about wealth is that growth benefits the general public in different ways, depending on where it is generated. I’ll take just one small example of what I mean.

An important, and oft-overlooked, component of the benefits of economic growth is the externalities that arise from increasing demand for certain goods and services – usually, in the form of product improvements and market enhancement.

What this means is that broad based growth, which raises the disposable income of a relatively large number of people, has the potential to be extremely beneficial to future consumers.

The economic good years of the 1950s, for example, were broad based, and resulted, famously, in a huge expansion in the ownership of consumer durables – fridges, TVs, washing machines and vacuum cleaners.

But the best bit is that this becomes a virtuous circle, because the demand in these sector drives innovation and competition. So, a family which bought a fridge for £75 in 1952 were benefiting families who bought a better fridge for £40 in 1957.

Growth in the last 25 or so years, though, has been based on a very small number of very wealthy people – and this is where the mass benefit breaks down.

The improvements to the quality of yachts, or the redesign of the Bentley Continental, have far less application to our own lives than would improvements to products that we actually buy – and in a world where the wealthy are increasingly cut-off from the rest of us in lifestyle, this is increasingly the case. The growth and its benefits we have seen in positive GDP growth figures up to before the recession has, in actuality, been concentrated in a very few hands.

Before we can be honest with ourselves about the limitations of Britain’s wealth fetish, we will have a blinkered view of what can be done to make our economy one that is broad based, and so able to benefit more people more of the time.