Tag: Oxfam

Hell of a state: What the tragic story of Don Lane tells us about Tory Britain

By Daniel Margrain

Don Lane

Don Lane, who suffered from diabetes, earned his living by delivering parcels to peoples’s homes and businesses throughout the country. Although Mr Lane was paid a salary by the giant courier company he worked for, according to the law, he was “self-employed”.

The amount he was paid depended on how many parcels he delivered. Mr Lane received no holiday or sick pay and was under constant pressure to meet targets. Drivers for the company get fined by them for rounds they miss. Mr Lane was recently fined for attending a medical appointment to treat his diabetes where tragically he collapsed and died.

The scandal that underlies the story is one which the bosses and shareholders of giant multinational companies like the one Don Lane worked “self-employed” for, have seen their dividends and pay go through the roof, while workers at the bottom, have experienced a real terms drop in their income over many years. The ideology that drives this “gushing up” of wealth towards the top, is called neoliberalism.

Before its onset four decades ago, the UK was a much more equal society than it is at present. The available data shows that the share of income going to the top 10 per cent of the population fell over the 40 years to 1979, from 34.6 per cent in 1938 to 21 per cent, while the share going to the bottom 10 per cent rose slightly.

As measured by the Gini Coefficient (see below), the redistribution of wealth from the poorest to the richest, rose sharply under the Thatcher government in 1979. The trend continued, albeit less drastically, under successive Tory and Labour governments where it reached a peak in 2009-10.

Figures show that GDP, adjusted for inflation, has grown over the last 60 years from £432bn in 1955 to £1,864bn in 2016. This increase in wealth, however, has become increasingly concentrated in fewer hands.

Inequality

SourceIFS 2016

Impact of inequality

report by Oxfam highlights the significant role neoliberalism plays in perpetuating inequality and suggests that the societies most affected are more prone to conflict or instability. The report also points out that extremes of inequality are bad for economic growth, as well as being related to a range of health and social problems including mental illness and violent crime.

Moreover, Richard Wilkinson and Kate Pickett, authors of the book, The Spirit Level. argue that other impacts of inequality include drug addiction, obesity, loss of community life, imprisonment, unequal opportunities and poorer well-being for children.

Left Foot Forward has cited studies that illustrate the close correlation between inequality and unhappiness. The tendency to equate outward wealth with inner worth means that inequality colours our social perceptions. It invokes feelings of superiority and inferiority, dominance and subordination – which affect the way we relate to, and treat, each other.

But rather than introducing socioeconomic policies that help reduce inequality, the Conservative government under Theresa May, has deliberately and consciously continued with the failed high borrowing-low investment/high debt economic neoliberal model that gives rise to it. Under the guise of austerity, the government have instead turned on workers, the sick and the disabled. The result has been increasing rates of depression, anxiety and suicides.

Fragmented

The existence of fragmented and atomised communities outside the confines of the workplace, the reduction in organised labour within it (illustrated by the long-term decline in trade union membership) and the lack of any safety net, means that ordinary people are increasingly vulnerable to the vagaries of “market forces”.

The ideology that underpins the neoliberal assault is the pseudo-science concept known as biological determinism, the legitimacy of which rests on the assertion that the social order is a consequence of unchanging human biology, as opposed to the result of inherited economic privilege or luck.

Thus, biological determinism reinforces the notion that inequality, injustice and the existence of entrenched hierarchical social structures of government, media and commerce are “natural”.

But it also highlights the artificial limits that a system driven by profit imposes. Any rejection of biological determinism and the rigged market system that reinforces it, is regarded by its promoters as being the fault of the individual, not the social institutions or the way society is structured.

Thus, according to evolutionary psychologists, sociobiologists and those within the elite political and media establishment, the solution to overcoming inequality and injustice is not to challenge existing social structures upon which “reality” is based, but rather to alter the chemical composition of the human brain to accommodate it to this reality.

In extreme circumstances it has been used to justify the elimination of individuals altogether who challenge the prevailing orthodoxy and/or whose values are perceived to be a “drain on the taxpayer”.

Social Darwinism

Years before moving towards explicit racial genocide, the Nazis developed the notion of ‘useless mouths’ or ‘life unworthy of life’ to justify its killing of ‘undesirables’ or ‘low hanging fruit’. These ideas are a variant of nineteenth century ‘Social Darwinism’ and eugenicist theories.

The said theories adapted Darwin’s notion of the survival of the fittest to describe relationships within society or between nations and races as a perpetual evolutionary struggle in which the supposedly weaker or defective elements were weeded out by the strongest and the ‘fittest’ by natural selection.

Intellectual challenges to neoliberalism and evolutionary psychology help undermine the notion that rigid social stratification, inequality and injustice used to justify them, are inevitable. Indeed, prominent economists such as Joseph Stiglitz, Paul Krugman, Dani Rodrik and Jeffrey Sachs have for a long time been raising their voices against the neoliberal experiment.

What is self-evidently clear is that the current rigged economic system in which power is increasingly concentrated at the top, is not sustainable. The only thing preventing our ability to tackle extreme inequality is political will.

At the next election voters will be faced with a clear choice – either to maintain the status quo by returning the Conservatives to power or, alternatively, to engender a paradigm shift by electing a Labour government. If future Don Lane’s are to be avoided, then we have no alternative other than to ensure a Corbyn victory.

Please make a small donation

If you’ve enjoyed reading this or another posting, please consider making a donation, no matter how small. I don’t make any money from my work, and I’m not funded. You can help continue my research and write independently.… Thanks!


Donate Button with Credit Cards

‘No man is an Island’

By Daniel Margrain

This year the Dutch government intend to introduce a universal basic income (UBI) paid to the residents of Utrecht and 19 other Dutch municipalities. Each person will receive the equivalent of about £150 a week whether working or not. The unemployed won’t be penalized for finding work because they will receive their employment income in addition to the universal income payment.

The hope is that this will prevent the government having to spend extra money on the vast array of related services connected to the bureaucratic elements of the state that are dependent on the unemployed for their existence. This covers everything from unemployed benefit snoopers to the administering of homeless shelters. Then there are the knock-on affects that stem from inequality such as health, poverty and crime. Writing in the Guardian, John O’Farrell astutely points out:

“Since the decline of the unions, workers have been increasingly powerless to refuse longer hours and less money with only the food bank to fall back on if they walk away from an exploitative job. With a guaranteed state income to keep the wolf from the door, employees would be given the bargaining power to demand civilized working conditions and reasonable rates of pay….Our labyrinthine system of benefits and tax credits would disappear and all the stigma of signing on with its degrading culture of blame and humiliation for those at the bottom of the pile.”

The system in the UK is predicated on blaming those at the bottom of the pile and casting humiliation on them, thus enabling the majority in the middle, to feel better about themselves. O’Farrell  concludes:

“For all the apparent expense of the UBI, we would save the small fortune that the state currently spends mopping up the mess of social problems caused overwhelmingly by chronic poverty. Of course, there are complex reasons for increasing homelessness, for bulging prisons, for growing mental health problems – but desperate financial pressure is a major factor in all of them. Every decade sees us spending increasing billions trying to tighten the lid of the boiling cauldron. It might be so much cheaper just to turn down the temperature a bit.”

The long-term socioeconomic and health benefits related to the kind of progressive and enlightened policy adopted by the Dutch is palpable, not only to the poorest in society but it also has some benefits to those at the top. As Richard Wilkinson put it: There seems to be some truth in John Donne’s “No man is an island.”

Rather than the punitive strategy of coercion adopted by the British and other governments by which the ‘stick’ is preferred to the ‘carrot’, the introduction of the UBI – predicated on economic pragmatism rather than state vindictiveness – will almost certainly result in the nurturing of talents and creativity that otherwise wouldn’t necessarily be encouraged.

It’s almost certainly no coincidence that what was arguably the peak of working class creativity in the arts occurred during the 1960s when, underpinned by a universal system of welfare provision, the class in question was at its most confident – a confidence that has been in decline from the mid 1970s onward marked by the ending of the post-war settlement between capital and labour.

Over the last 40 years, ordinary people have found it increasingly difficult to focus on doing things they really like because they tend to spend most of the productive part of their lives working at something they hate often for no other a reason than to maintain the necessities of life – namely securing a roof over their head and ensuring they have access to enough food.

Since the Callaghan government, punishment has been the overriding factor that has guided the social policy of successive UK administrations’ – both Conservative and Labour. The purpose has been to foster a lack of any sense of entitlement. This has involved the gradual removal of a social security safety net that a universal system implies, so as to maintain the level of social stratification to meet the demands set by unfettered capital.

The Dutch model, intended as a corrective to the lack of universal provision, is in principle similar to that adopted by the Green Party as outlined in their last General Election Manifesto. The rationale underpinning the introduction of such a model is that it would not only end the kinds of state bureaucracy and inefficiencies described, but would also be cheaper to administer and hence save the tax payer money. Third, it would boost local economies because poor people would have greater income at their disposal with which to spend on goods and services.

But arguably the greatest benefit is that such a policy would lead to a reduction in inequality whose affects, as Richard Wilkinson has shown, are divisive, harmful and socially corrosive. Research indicates that the world’s richest 1 percent of people this coming year are expected to own the same amount of wealth as the rest.

The more equitable and egalitarian the society, the greater the control people have over their lives. Two years ago, Oxfam research demonstrated how extreme wealth confers political power that can be used to influence rules and systems in favour of an elite at the expense of everyone else.

In addition, more equal and fair societies’ provide the conditions by which a system of equality of opportunity can be put into place. Workers, as participants in a scheme of cooperation that contribute toward national income, would then have a claim to a fair share of what they have helped to produce.

Richard Wilkinson shows that a correlation exists between income inequality within countries (not between them) and social gradients in terms of a multitude of indicators. These include health, life expectancy, literacy/numeracy, infant mortality rates, homicide rates, proportion of the population in prison, teenage birthrates, levels of trust, obesity, mental illness – which in standard diagnostic classification includes drug and alcohol addiction – and social mobility.

What the data shows is that in the more equal countries – Japan, Finland, Norway, Sweden – the top 20 percent are about three and a half to four times as rich as the bottom 20 percent. But on the more unequal end – U.K., Portugal, USA, Singapore – the differences are twice as big. On that measure, the UK is twice as unequal as some of the other successful market democracies.

According to research measured by the Gini coefficient, which is widely regarded as the best measurement of income inequality, Holland is the fourth most equal society within the EU while the UK is ranked way down at twenty-one. What impacts on society does this level of inequality point to?

Wilkinson collected internationally comparable data on problems with social gradients – the kind of problems that are more common at the bottom of the social ladder of the kind outlined above – and weighted them equally by putting them all in one index. The data showed an extraordinarily close correlation between inequality and the kinds of social problems described. The same correlation equally applies to children who also perform worse in the more unequal societies.

What the data in its totality indicates is that the average well-being of our societies is not dependent any longer on national income and economic growth. Wilkinson elaborates further:

“That’s very important in poorer countries, but not in the rich developed world. But the differences between us and where we are in relation to each other now matter very much. I’m going to show you some of the separate bits of our index. Here, for instance, is trust. It’s simply the proportion of the population who agree most people can be trusted. It comes from the World Values Survey. You see, at the more unequal end, it’s about 15 percent of the population who feel they can trust others. But in the more equal societies, it rises to 60 or 65 percent. And if you look at measures of involvement in community life or social capital, very similar relationships closely related to inequality.”

In terms of mental illness:

WHO put together figures using the same diagnostic interviews on random samples of the population to allow us to compare rates of mental illness in each society. This is the percent of the population with any mental illness in the preceding year. And it goes from about eight percent up to three times that — whole societies with three times the level of mental illness of others. And again, closely related to inequality.”

The overriding factor that emerges from Wilkinson’s research into inequality are it’s psycho-social effects and how this relates to the kinds of values inherent to a capitalist system in which society is driven by consumerism and competition that leads to status insecurity. The potential for the onset of chronic stress and depression from social sources in turn:

“affect the immune system, the cardiovascular system. Or for instance, the reason why violence becomes more common in more unequal societies is because people are sensitive to being looked down on….I should say that to deal with this we’ve got to…constrain income, the bonus culture incomes at the top. I think we must make our bosses accountable to their employees in any way we can. I think the take-home message though is that we can improve the real quality of human life by reducing the differences in incomes between us.”

With regards to social mobility, Wilkinson states bluntly that if Americans want to live the American dream, they should go to Denmark.”