Six years ago my ideas about inequality in society were given a jolt by the publication of a book with the intriguing title ‘The Spirit Level: Why equality is better for everyone‘, by Richard Wilkinson and Kate Pickett. The authors – both academics – drew on research from many sources to show that societies in which there are huge variations in income are bad for everyone, rich or poor, and that more equal societies benefit all their members.
We might expect inequality to have an impact on factors such as life expectancy and educational performance, but the authors observed its effects in some surprising areas of life, from obesity (‘wider income gaps = wider waists’) to teenage births. And in each case the effect was seen right across the income spectrum. The sobering truth is that, amongst the developed nations, the UK is one of the more unequal countries.
I organise the Social Liberal Forum annual conference, and this year we thought it would be interesting to revisit some of these seminal ideas. Responding to the level of interest in the book when it was published in 2010, the authors set up The Equality Trust to carry forward their work, and we have worked with the Trust in putting the programme together. We have given it the title ‘Inequality Street’, and it will happen on 16th July in London.
An article by Shiv Malik in The Guardian caught our eye recently. It has the challenging title ‘Why inequality is not the root of all evil‘, and we are delighted that he has responded to our invitation to engage in a debate with Prateek Buch.
A number of current parliamentarians will also be speaking (Norman Lamb, Lindsay Northover, Claire Tyler, Jonny Oates) as well as party members and invited guests such as Neal Lawson from Compass and Simon Howard from United Kingdom Sustainable Investment & Finance Association. Vince Cable will give the William Beveridge Memorial Lecture.
The Social Liberal Forum Conference is always a good day of debate, reflection and socialising. You don’t have to be a member of the Social Liberal Forum in order to attend – indeed the conference is designed to be of interest to all Liberal Democrats.
Further details and registration are here. The Early Bird rate ends today so now would be a good time to book your place.
* Mary Reid is a contributing editor on Lib Dem Voice. She was a councillor in Kingston upon Thames, where she is still very active with the local party, and is the Hon President of Kingston Lib Dems.
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8 Comments
While neoliberals claim inequality is a red herring, because under a free market economy everyone gets richer, it doesn’t take much imagination to critique that discourse. And it’s nothing to do with jealousy, as the right would have you believe. Initially everyone does get a better standard of living, but sooner or later the tipping point is reached where those who have done very well have most of the resources and, consequently, the power.
I liken it to a game of Monopoly. Easy to see that the first few laps of the board sees everyone getting hundreds of pounds – usually for passing Go (helicopter money?) – and rents are cheap. But eventually inequality bites and the rich get richer and the poor poorer. Until the poor either capitulate (accept poverty) or resort to cheating (crime) or tipping the board over (revolution).
We can see in real life London that now someone has metaphorically (or perhaps literally) plonked a hotel on Whitechapel, rents for the rest of the people have become unaffordable. Surprise surprise, the Labour vote is doing very well there.
http://moneyquestioner.co.uk/money/poverty-and-the-free-market/
It’s incumbent on the democratically elected government to represent the people. And that means ensuring that inequality doesn’t result in vast numbers of disenfranchised people. The government’s solution is Help-to-Buy in its various forms, which of course just fuels property inflation with taxpayers’ money. I have thought about this a lot and have concluded that the only way to redress property inequality is to redistribute property wealth, i.e. using wealth that’s already in the property market. This, inescapably, leads to a land tax.
http://moneyquestioner.co.uk/finance/stamp-duty-wealth-tax/
After all it’s ultimately that nation’s land that is “owned”. Anyone who finds the idea of state land ownership a bit too left wing should consider the consequences of our country being invaded or following a revolution. The current land registry would mean nothing. It’s the nation that upholds land ownership and defends landowners rights of occupation. It’s correct that not only should they pay for this, but that everyone in the country who wants it should have access to some of it.
http://moneyquestioner.co.uk/finance/democratic-taxation/
Following the argument in the response , the solution is ownership of property by vastly more people , if we put more thought into actually conceiving ways to genuinely extend into a “property owning democracy ” not just opposing knee jerk schemes like the governments latest on housing associations , with knee jerk no solution responses , we might get more support and votes !
The rent to own ideas we began to advance in the General election were a start , but not radical enough. We should be supporting right to buy in our own policy version , with not only like for like replacement , but a presumption of rent to own for all !Radical !
Here is a quiz, based on the findings of the multiple research studies reviewed in “The Spirit Level”.
Ruritania is a reasonably well-off Western country with relatively low income inequality. In Ruritania, the average life expectancy is 75. It also averages 80 for the top 50% of Ruritanians in terms of income, and 70 for the bottom 50% of Ruritanians.
Elbonia is another Western country with an identical average income per head to that of Ruritania. However, Elbonia has relatively high income inequality. In Elbonia, the average life expectancy for the bottom 50% of the population, in term of income level, is 65.
What is the average life expectancy for the top 50% of the population in Elbonia?
Well, they earn more than their counterparts in Ruritania, of course. You might expect that to buy better health. You might guess an answer of 85 years for the Elbonian top 50%, and an overall average life expectancy the same as Ruritania’s at 75. But you’d be wrong.
You might think “yes, it’s wrong because of diminishing returns, that extra wealth in elite Elbonia won’t buy huge gains in health”. Then you might guess (say) 82 years, for the Elbonian top 50%. But you’d still be wrong.
The right answer is (roughly) 78 years. Yes, LESS than the corresponding figure for Ruritania, even though the Elbonian top 50% are richer than the Ruritanian top 50%.
Inequality harms the poor – But it also (if to a lesser extent) also HARMS the rich. Life expectancy, educational achievement, health, happiness – you name it, inequality harms it, for all classes not just the poor. That’s what evidence shows.
Get that concept on board, and boy does it change your politics!
Ownership of a property is just one form of tenure which can be easily taken away just like any other form of tenure .Remember you don’t own it until the last mortgage payment is made .The real owner is the bank or building society to whom you are paying a mortgage plus interest. Anyone fall on hard times so affordable security of tenure is a key issue if you want households to have the ability to develop and progress in a culture that encourages equality of opportunity.
Out of curiosity Mary – do you still buy the argument in The Spirit Level?
I originally read it back when I was an undergraduate student and thought it was quite a solid read – definitely influenced my political views. But a friend suggested I re-read it a few years later…. and my god with the benefit of some training in academic research (I now work as a education researcher) it seems incredibly weak in its claims. I’m not sure I can say more than is revealed in this interview (link below) Kate Pickett had with Tim Hartford, but if you read through it they can’t answer quite basic questions about the research basis for their work. Hard to take the book seriously given they’ve effectively done a lit review (with no methodology describing how they picked studies) and then plotted some lines of best fit which prove absolutely nothing in a causal sense.
One former top economist in Australia turned Labor MP, Andrew Leigh, also wrote a sold piece explaining why the arguments in the book don’t stack up (link below).
Am interested to hear whether people still buy these ideas – and if so, how do you respond the pieces below?
http://spiritleveldelusion.blogspot.co.uk/2010/08/spirit-level-has-been-debunked-more-or.html
https://previousleigh.wordpress.com/2009/12/14/look-at-the-changes-not-at-the-levels/
“Out of curiosity” Daniel Carr, why bother citing your first reference, which claims to “debunk” The Spirit Level by pointing out that the autrhors have critically reviewed other people’s research and (shock-horror) not done it all themselves?
Why bother citing your second reference, which admits that higher inequality generally correlates with poorer life expectancy, and then quotes (as if it were a conclusive rebuttal!) a single piece of research, which found that in one specific case, over time, inequality grew and life expectancy also improved…?
Lorenzo:
Before you describe a policy as a knee-jerk reaction, how about checking the thought and history behind it?
Opposition to forced housing association property sales is because it drastically reduces the availability of housing for people who can’t afford or (good Liberal reason) don’t want to buy their own houses. Housing associations, often with charitable origins, build for people on lower incomes to rent. Force sales, and the properties have to be built from new by government or charities.
As for the argument about the conclusions of The Spirit Level, it doesn’t take an academic to see that greater inequality leads to more crime, more demands on health services and therefore more need for expensive public services, whether that need is met expensively or ignored.
Never mind the arguments about research methodology. Some inequality is necessary. Extreme inequality is disastrous for everyone; the wealthy and the poverty stricken. What is a political party, the Liberal Democrats, going to actually DO about it? Debating inequality is merely navel gazing. The reason for the financial crises and social problems is due to the “success” of the founders of the Centre for Policy Studies. The economic ideology the organisation has propagated has been accepted by the ECB, the World Bank, the Federal Reserve Bank of the USA.
I have already published a possible alternative economic system. When will others in the party publish their ideas/solutions?