On 04 June, 2014, at 3.52pm BST, Cameron said inequality is at its lowest level since 1986. I really thought I’d misheard him. Cameron lies, that’s established fact. But mendacity of such epic proportions is surely a clear indication that this really is the Coalition’s last stand.
This isn’t the first time Cameron has used this lie. We have a government that provides disproportionate and growing returns to the already wealthy, whilst imposing austerity cuts on the very poorest. How can such a government possibly claim that inequality is falling, when inequality is so fundamental to their ideology, and when social inequalities are extended and perpetuated by all of their policies? It seems the standard measure of inequality is being used to mislead us into thinking that the economy is far more “inclusive’ than it is.
The Gini coefficient measures the inequality among values of a frequency distribution and is currently how we measure levels of income inequality.
However, the Gini coefficient is a relative measure. Its proper use and interpretation is controversial. A Gini index does not contain information about absolute national or personal incomes. Wealth inequality may well be greater than income inequality. For example, economist Edward Wolff found that, while the highest-earning fifth of U.S. families earned 59.1% of all income, the richest fifth held 88.9% of all wealth.
A major limitation of Gini coefficient in empirical work is therefore its focus on relative income distribution, rather than real, absolute levels of poverty and prosperity in society, and that aspects of inequality can be hidden via demographics or government policies. The relative Gini is used because the alternative methodologies are deemed too complex: it is simple, convenient formula that presents simple, convenient but meaningless values. Such rootless, unanchored values can then be given the same traditional Tory solutions, convenience being an alibi for endorsing social injustice.
Such a method of poverty measurement that has so little regard for how much money people actually have and what living standards they enjoy (or don’t) deserves to be treated with scepticism, if not contempt, especially by the man on the Clapham omnibus. And it generally is.
The Equality Trust directly compare income distribution, and this analysis provides a completely different account to the one Cameron is telling, but then we all know that “Tory” is an abbreviation of “tall stories.”
And since when were Conservative governments ever equated with social equality and egalitarianism? Thatcher, that great “communist” and social reformer (!), never tried to impose the scale of austerity cuts that the current government have, but few would disagree that she presided over a massive rise in poverty and inequality.
Tory policy creates inequalities. This is academically confirmed and verified empirically time and time again. Public health experts from Durham University have denounced the impact of Margaret Thatcher’s policies on the well-being of the British public in new research, which examines social inequality in the 1980s. The research shows the importance of the decisions of governments and politicians in driving health inequalities and population health. The researchers warn that advancements in public health will be severely limited if governments continue to pursue heavily neoliberal economic policies – such as the current welfare state cuts being carried out under the guise of austerity.
When it comes to reliable data about inequality and poverty, I think the Joseph Rowntree Foundation (JRF) has a well-established credibility, based on over a hundred years of experience in reliably measuring poverty. Cameron, on the other hand, does tend to get publicly rebuked for being … conservative with the truth.
Since 2010, wages have been rising more slowly than prices, and over the past 12 months, incomes have been further eroded by cuts to benefits and tax credits. Tory ministers argue that the raising of the personal tax allowance to £10, 000 for low income households will help. However, according to the JRF report, its effect is cancelled out by cuts and rising living costs. (Please see Quantitative Data on Poverty from the Joseph Rowntree Foundation.)
Currently the rise in the number of people who are unable to adequately heat their homes is largely due to inflated, rising fuel costs. The alleged progressive nature of the income tax system is severely undermined by the regressive nature of stealth taxes, duties, Income tax, National Insurance, Bedroom Tax, Council tax, Licences, Social care charges, VAT and many others taxes, which take a much larger portion of income from the poor than from the rich.
In 2011/12, the poorest fifth of households spent 29 per cent of their disposable income on indirect taxes, compared with 14 per cent paid by the richest fifth. All told, the poorest households pay 37 per cent of their gross income in direct and indirect taxes. In other words, the single biggest expenditure for people in poverty is tax. It is, at the very least, morally unjustifiable to be taxing the poorest citizens at such a rate. The most important thing the government can do to help the poorest people is to stop taking their money.
We don’t have the figures that may reflect the impact of the welfare “reforms” from the Office of National Statistics yet.
Last years figures showed that absolute poverty among children rose by 300,000, with two-thirds of those living in households with one or more earners. That makes a mockery of the Tory claim that they are “making work pay.” How does cutting welfare improve the lot of the lowest paid?
Absolute poverty means that people cannot meet their basic survival needs – such as meeting the costs of food, fuel and shelter. Welfare evolved to address such fundamental deprivation, and absolute poverty had been eradicated in Britain because of the protective social security system. Until now. Children are once again suffering from illnesses historically associated with poverty and malnutrition, such as rickets and scurvy.
Alison Garnham, chief executive of Child Poverty Action Group, said: “Despite all the talk about ‘scroungers’ and generations of families never working, today’s poverty figures expose comprehensively the myth that the main cause of poverty is people choosing not to work.
“The truth is that for a growing number of families, work isn’t working. The promise that work would be a route out of poverty has not been kept as wages stagnate and spending cuts have hurt low-income working families.”
In March this year, Oxfam urged the chancellor George Osborne to use his budget to make an assault on tax avoidance and introduce a living wage, in a report they published. The report highlighted how a handful of the super-rich, headed by the Duke of Westminster, have more money and financial assets than 12.6 million Britons put together.
Oxfam’s director of campaigns and policy, Ben Phillips, said: “Britain is becoming a deeply divided nation, with a wealthy elite who are seeing their incomes spiral up, while millions of families are struggling to make ends meet.
“It’s deeply worrying that these extreme levels of wealth inequality exist in Britain today, where just a handful of people have more money than millions struggling to survive on the breadline.”
This is a prime minister that has overburdened very vulnerable citizens with austerity, austerity and more austerity, taken away support services and reduced, cut and sanctioned away lifeline benefits for the very poorest whilst liberating the wealthiest from any social responsibilities, handing out tax breaks to the tune of £107,000 each per year to the millionaires. How can that NOT lead to gross inequalities?
The only truth I’ve ever heard Cameron utter was his Freudian-styled slip, when he said: “We are raising more money for the rich.” Yes. From where?
A simple truth is that poverty happens because some people are very, very rich. That happens ultimately because of Government policies that create, sustain and extend inequalities. The very wealthy are becoming wealthier, the poor are becoming poorer. This is a consequence of “vulture capitalism” – the opportunism and pernicious greed of a politically influential few, it is instituted, facilitated and directed by the Tory-led Coalition. That isn’t democracy: it’s blatant corruption
The real reason for the austerity measures that this Government have inflicted on the poorest citizens is that Tory sponsors and very greedy rich people are being handsomely rewarded with tax payers money. The money for our welfare provision, our healthcare, our public services, schools, and so on, is being stolen from the British public and backhanded to the undeserving rich – there is the REAL “culture of entitlement”.
Private companies, many of which donate to the Conservative party, and have a subsequent powerful (and corrupt) lobbying influence on Tory policies, are making a fortune from the poverty that has been inflicted on many citizens. We have seen that the private sector do not deliver public “services” or meet public needs at all. (Atos, A4E, G4S, for example.) Private companies simply make profit. Indeed, that profit is all too often made at the expense of the well-being of Citizens.
Eugenic policy is now an acted out by stealth, dressed up as a “necessary” economic act, and further dressed up by propaganda to hide the consequences as well as the intent, carried out by a government that has rigged the neoliberal market. The act of murder simply requires policies that leave the vulnerable without support to meet their basic survival needs, denial from government that this is happening, and then it’s just a matter of withholding or hiding the evidence.
An openly declared belief in eugenics is a thing of the past, as Hitler discredited the eugenics movement so thoroughly, however, eugenics is far from a thing of the past, and the right are and always have been social Darwinists. But I predict that if the Conservatives win the election in May, we will start to see reductions in welfare support for children from poor backgrounds, and a limit placed on the number of children that are entitled to support in families. That is eugenics.
Human rights were a cooperative international response to the Holocaust, premised on a socialist axiom that every human life has equal worth.
Authoritarianism, nationalism, fascism and Conservatism are premised on inequality, a hierarchy of worth and Social Darwinism. That’s why the Right are so against EU membership and the ECHR: they see such safeguard rights as an obstacle to their neo-feudalist vision of how society should be.
Prior to the Holocaust, eugenics fitted well with the dominant paradigm – comprised of laissez faire economics, competitive individualism, Malthus’s ideas on population and Spencer’s Social Darwinism. Those ideas, once explicitly endorsed, are now implicitly captured in policies and Conservative narratives about sanctions, “conditionality,” “making work pay,” (compare with the principle of less eligibility enshrined in the New Poor Law) “fairness,” “incentives,” “scroungers,” and so forth.
If you think this seems a little far-fetched, consider that the government are deliberately targeting the most poorest and vulnerable citizens to bear the brunt of austerity cuts.
The cuts are not fairly distributed at all.
They target the very groups that a decent, civilised society would protect:
- People in poverty (1 in 5 of us) bear 39% of all the cuts
- Disabled people (1 in 13 of us) bear 29% of all the cuts
- People with severe disabilities (1 in 50 of us) bear 15% of all the cuts
The unfairness of this policy becomes even clearer when we look at the difference between the burden of cuts that falls on most citizens and the burdens that fall on minority groups. By 2015 the annual average loss in income or services will be:
- People who are not in poverty or have no disability will lose £467 per year
- People who are in poverty will lose £2,195 per year
- Disabled people will lose £4,410 per year
- Disabled people needing social care will lose £8,832 per year
Thank goodness that the Tory-led government shows some compassion for those poor millionaires, who were handed £107,000 each per year from our Treasury in the form of a tax cut in Osborne’s 2012 budget. I wonder where the money for that handout came from….
Taking money from the most vulnerable and poorest members of Society means they are unlikely to be able to meet their basic biological needs. Welfare provision was based on the carefully calculated amounts we need to survive, so the amount of benefit is just enough to cover the costs of housing, food and fuel. That’s all. There is no provision made in any benefit for cars, holidays abroad, children’s birthdays and Christmas, large, flat screened TV’s. books or clothing. Just food, fuel and shelter. Anything more generous is simply added via propaganda. The Tory-directed media perpetuate myths to cultivate petty and divisive social “concerns” to “justify” the fact that we are being systematically and massively robbed of the money we paid in for our own provisions and services.
And people are dying as a consequence.
Does income inequality cause health and social problems? – In 2011, the Joseph Rowntree Foundation conducted this research, with the main aim of reviewing the evidence concerning the impact of income inequality on on health and social problems. However, the report concludes by considering a range of policy implications.
Given the main conclusion is that both individual income (material circumstances) and income inequality (relative income) make a crucial difference to health and social problems, it seems clear that both need to be tackled. A range of policy levers can be used to do this: from redistribution through the tax/benefit system, to original income and wealth policies, to stronger public services, to a greater focus on equal opportunities.
Medical experts recently wrote an open letter to David Cameron slamming the rise in food poverty, saying families “are not earning enough money to meet their most basic nutritional needs” and that “the welfare system is increasingly failing to provide a robust line of defence against hunger.” – New research by Oxfam has revealed the true extent of the amount of British children living in poverty, with families taking drastic measures.
Pictures courtesy of Rob Livingstone