A recent report shows that the reformist actions of the Labour government have not been able to reverse the inequalities that capitalism generates.Minister for Women and Equality Harriet Harman, who won the Labour Party deputy leadership by talking up left wing and egalitarian credentials, set up a National Equality Panel to look into inequality in UK society, and report back. That the report, An Anatomy of Economic Equality in the UK (summary at the following link), has come out in the period of the run up to a general election, at which Labour are desperately trying to cling onto their heartland support and produce clear red water between themselves and the Tories, is surely purely coincidental.
Graph 1: Full-time weekly earnings at 2008 prices, 1968 to 2008, men
Source: NEP, based on 1968-1996 New Earnings Survey (NES) (GB),1997-2008 ASHE (UK).
Not only, as the headline writers all noticed, has the gap between the top and bottom earners widened over the last forty years (quite radically) but also it has risen quite markedly as compared to median earnings. What is most startling of all is that the lowest paid workers have barely gained any substantial increased over all that period. So much for the idea propounded by Tories of the ‘trickle down effect’ of gains for the rich becoming gains for the poor. Likewise, so much for the social democrat notion that growth of the economy overall will abolish poverty. Through most of that period, the British economy has grown, and clearly only grown to the benefit of those at the top.
“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.”