Economics Equality Politics

Beyond ‘The Spirit Level’ – Tackling Inequality

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Studies that have attempted to carefully distinguish between the direct effects of individual poverty and of generalised inequality have produced mixed results depending on the method used and the consequence studied. The current state of opinion is probably in favour of a small but significant correlation of inequality with life-expectancy and self-reported health over and above individual income effects. Certain causes of death, such as homicide, show clearer correlations than others. What remains unclear is exactly how much of this correlation is a result of common additional factors. Race and education may account for some, but not all, of the correlation within the United States.

Clearly similar arguments may apply to several of the other correlates with income inequality identified by Wilkinson and Pickett, such as illegal drug use, poor educational attainment and dropouts, teenage pregnancy rates, imprisonment and levels of trust. In particular, if poverty is correctly viewed as a ‘threshold’ concept, so that those below the threshold are much more likely to suffer these problems than those above it, then once again the correlation may have little or no direct significance for those at the top of the income scale. The sophistication of the statistical methods required to tease out the causal elements means that clarity and certainty at the level of the average citizen and the mainstream press are probably elusive. Using this particular idea as a central peg to support egalitarian policies is probably unwise.

Prospects for the Majority

Some of the reaction to ‘The Spirit Level’ from well-funded right-wing thinktanks and maverick social scientists suggests a clear ‘debunking’ agenda that has not been aimed at clarifying the debate, but obfuscating it. This in itself suggests that to some, high relative status is more important than direct welfare considerations; that even if direct inequality effects do exist the very rich will always believe they can insulate themselves from them; and that there is major ideological blinkering.

The probable reality is that those at the very top of the income and wealth scale cannot be engaged in any reasoned debate about the merits of policies for the ‘common good’ even when that common good appears likely to include their own. Whatever the merits or otherwise of the discrepancy in resources between the rich and poor for the rich, it is most certainly bad for the poor, and almost certainly bad for the rest of us. So the focus should not be on the rich, but on the overwhelming majority of poor to average wealth who will unequivocally gain from a different distribution of resources.

Most are now aware of the disparity of wealth and power that exist – as they become aware of self-seeking behaviour at the top in terms of the press, the banking sector and politicians. At the bottom those on benefits and low wages are squeezed and even demonised, while in the middle even those who felt comfortably off are finding it difficult to cope, to the extent that 1 in 4 families are below what has been calculated by a team from Loughborough University and the Joseph Rowntree Foundation as the minimum income needed to be fully part of modern British society. For the young, even graduates, adequately-paid employment is increasingly scarce.

Of course we do not expect that everyone will rise to the top of the earnings ladder or the top professions (or even that all of our children will). We do all have different abilities and talents (although the extent to which this is innate is exaggerated) formative experiences and luck. And we generally accept that those with some talents in abundance may command higher incomes on the basis of low supply and high demand.

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