The richest 1,000 people have more wealth than the poorest 40% of households (UK)

The richest 1,000 people in the UK have more wealth than the poorest 40% of UK households. The 1,000 richest saw their wealth increase by a staggering £82.5 billion last year, the equivalent of £226 million a day, or £2,615 a second.

The Equality Trust has found that this increase in wealth of £82.5 billion could:

Pay the energy bills of all 25.6 million UK households for two and a half years. Cost = £79.15 billion OR

Provide 5,143,819 million Living Wage jobs , or 2,923,333 million jobs paid at an average salary for a year. Cost = £82.476 billion OR

Pay the grocery bill for all of the UK’s users of food banks for 56 years . Cost = £81.5 billion OR

Pay two years’ rent for 4.5 million households (4,528,000 households) . Cost = £72.1 billion OR

Pay for 68% of the budget for the NHS in England Cost = £81.6 billion
Pay for 4 years of adult social care in England . Cost = £78.8 billion.

This totally unearned bonanza needs justifying somehow. It arises merely from the structure of wealth ownership, tax laws, and property holdings. The beneficiaries had to do little beyond what they currently own or do to enjoy this largesse.

One justification for the support of the current social structure of wealth ownership and control is that these people pay in absolute terms a good deal of tax. If you are destitute at least you don’t pay tax. Consider however that if one paid tax on income on say, £1,000,000, under current tax rates you would still get £540,676 per year. You pay nearly 44% of your income.

The median in the U.K. in 2017 is £27,000. Thus you take home £21, 641. You pay 20% of your income. You take home 4% of what the high earner does.

The millionaire pays as much tax in one year (£458,000) as a the median earner would (£5,200 pa) in 88 years. This is of course ‘inequality’.

So for every 1 person receiving £1,000,000, you’d need 88 on the median. Impossible of course due to what median means. The top 1000 get, receive, not ‘earn’, considerably more than what to them what would be a miserable £1,000,000 pa.

Those who earn up to the £150,000 threshold of 40% take home £90,176. Each extra pound they then get is taxed at 45%. What if that tax rate was 90%? This would mean someone getting £200,000 would receive £90,176 up to the £150,000 threshold and then another £5,000 taking it to £95,176. Someone getting £1,000,000 would after tax get £90,176 + £98,500 = £188,676.

The price of a loaf of bread would be the same.

So even at 90% marginal tax rates over the threshold, a millionaire would not have to worry about paying utility bills. Yes they pay more tax, but what’s left for them is hardly destitution. I digress. Millionaires to the 0.01% are paupers. Billionaires can avoid paying any taxes at all.

A second justification is that they are the ‘wealth creators’ and so deserve it all. I will not unpick this here because the rebuff is as obvious as the claim is spurious.

A third justification is that changing this structure would lead to economic chaos and left wing totalitarianism. This sets up a false dichotomy of either keeping hold of wealth or descent into tyranny.

A fourth justification is that the wealthy need to get ‘rewarded’ as they operate in a competing market, and that pay rates merely reflects market forces at work? Well, indeed but should that really be a plea to hold on to vast amounts of wealth? Are you really saying that you are miffed because someone else gets £5,000,000 pa while you get a ‘paltry’ £2,000,000 ?

There is a fifth technical justification – the Laffer Curve:

“In economics, the Laffer curve is a representation of the relationship between rates of taxation and the resulting levels of government revenue. Proponents of the Laffer curve claim that it illustrates the concept of taxable income elasticity—i.e., taxable income will change in response to changes in the rate of taxation.

The Laffer curve postulates that no tax revenue will be raised at the extreme tax rates of 0% and 100% and that there must be at least one rate which maximizes government taxation revenue. The Laffer curve is typically represented as a graph which starts at 0% tax with zero revenue, rises to a maximum rate of revenue at an intermediate rate of taxation, and then falls again to zero revenue at a 100% tax rate. The shape of the curve is uncertain and disputed.

One implication of the Laffer curve is that increasing tax rates beyond a certain point will be counter-productive for raising further tax revenue. A hypothetical Laffer curve for any given economy can only be estimated and such estimates are controversial. The New Palgrave Dictionary of Economics reports that estimates of revenue-maximizing tax rates have varied widely, with a mid-range of around 70%. Generally, economists have found little support for the claim that tax cuts from current rates increase tax revenues or that most taxes are on the side of the Laffer curve where additional cuts could increase government revenue.

Although economist Arthur Laffer does not claim to have invented the Laffer curve concept, it was popularized in the United States with policymakers following an afternoon meeting with Ford Administration officials Dick Cheney and Donald Rumsfeld in 1974 in which he reportedly sketched the curve on a napkin to illustrate his argument.”

See: Laffer Curve

If all else fails, fall back on classic economic models which are of course nothing more than mathematical representations of actual human behaviour in particular social and political contexts. They do not operate like the laws of physics. Hence they can easily change given different contexts.

With these vacuous and self serving justifications, the 1% keep the status quo going. Every society needs a unifying myth, and the powerful 1% need one even more so. Monarchy, Nation State, and ‘Free Market’ Capitalism (note: not financial/rentier/crony capitalism) are used as unifying myths to merely cover wealth and privilege. It is why right wing politics intuitively support monarchy, church and the flag because if those are dismissed by critics then that only leaves the theory of free market neoliberal capitalism as a defence against ‘the underclass’.

You decide if this level of wealth appropriation is good for social cohesion and health inequalities.

Poverty Privilege and Health

In two of the richest nations ever to have existed on planet earth we have a separation which allows affluent whites to exist in a bubble of privilege; a bubble of privilege which survives the shooting of police, deindustrialisation, poverty, precarity and the social gradient in health. Privilege understands and sees how radical losers exploit poverty and exclusion, but does not want to address social and economic structures; privilege understands that pain and anger can be turned both inward and outward but looks for solutions in the individual and ‘security’; privilege sees the transmission of poverty and exclusion only in the personal agency of the poor themselves.

Washington Heights is a suburb of the most segregated city in America. Charles lives in a part of Milwaukee where the residents are 99% white, yet a few blocks up are black neighbourhoods where shops are boarded up, many houses have repossession notices on their front doors, and the air is one of decay and poverty. The separation of black and white in Milwaukee is replicated in big cities right across the US, and separation breeds a lack of empathy.”

“Local authorities which report the highest rates of people facing severe and multiple disadvantage are mainly in the North of England, seaside towns and certain central London boroughs”

“Women who live in the least deprived parts of Kensington & Chelsea can expect almost a quarter of a century more of good health than their female counterparts in the most deprived part of the borough. For females at birth, the number of years an individual could expect to live in good health based on current rates – known as healthy life expectancy – differed by an average of 24.6 years between the most and least deprived parts of the borough” (ONS, 2015)

…and yet politicians like to focus on a ‘moral underclass’, blaming them for their behaviour that causes poverty. Drink and drugs are key factors in this regard:

“Ian Duncan Smith, Secretary of State for Work and Pensions, shocked readers of the Daily Mail with: ‘Addicts and alcoholics cost us £10billion a year, says Duncan Smith: Blitz launched to help people with drink drug problems find work’ “. (Glen Bramley LSE Blog)

There is a very old debate about whether poor people owe their circumstances to structural economic factors or to moral/behavioural failings. Sandra Carlisle in 2001 argued that there are ‘contested explanations, shifting discourses and ambiguous policies’  for health inequalities: there is the ‘Moral Underclass’ discourse, the ‘Social Integrationist’ Discourse and the ‘Redistrubutive’ discourse. Each has its own explanation as to why there are inequalities and then what to do about them.

Since Sandra Carlisle wrote her paper, there has been a a good deal of evidence to suggest that structural/economic forces are a major factor in people’s health and illness. There is some evidence also of ‘transmitted poverty‘ due to adverse childhood experiences. The misuse of Alcohol and Illegal substances (they are all drugs) are of course correlated:

“There is a huge overlap between the offender, substance misusing and homeless populations. For example, two thirds of people using homeless services are also either in the criminal justice system or in drug treatment in the same year”.

Many people faced with adverse social situations learn to cope, or they become fatalistic,  or they cling together in supportive communities or they become activists fighting for social justice.  Some self harm, some drink to excess, some go to University and become doctors or lawyers or politicians.  They exercise their personal agency and succeed or fail within structurally determined circumstances. They succeed, despite not because of, the activities and ideology of the privileged. A few of the successful however, then refuse to provide more ladders while shouting “I did it so can you”.

The lack of empathy, the total separation of lifeworlds, arises partly from moral intuitions that both blinds many politicians and commentators to alternative explanations pf poverty and binds them together in a bubble of privilege that prevents them from analysing the evidence. As we all do, they engage in post hoc rationalisations – in their case that that the poor are a moral underclass who are less intelligent, lazy, and hard working than the successful – to explain and justify their own positions.  This is almost a moral imperative, because not to blame the poor opens one up to the need to justify or critique the structural and economic privileges one has unequal access to. Placing the focus on the work, drinking and drug taking habits of a ‘moral underclass’ provides one with a sense of superiority and entitlement so much on show in both US and UK politics. No doubt the same occurs in Russia and China. To acknowledge that there are structural and economic conditions, for example the public school system or the service sector low wage economies,  or the inverse care law, opens up the middle class to accusations of champagne socialism.

This is a common tactic to deflect the argument away from an examination of causes to one of ‘ad hominem’.  Another tactic is to argue that the best way to address structural and economic factors is more of the same economic policies that have held sway especially in the US and UK. Indeed on a global scale the numbers of people living in absolute poverty is decreasing. Inequality is also decreasing with in the UK (gini coefficient). However these two factors are not the only issue.  Both the UK and the US are rich and other measures of inequality have increased, see for example the use of the Palma ratio. It matters greatly for very poor people to get incomes, and mortality rates, enjoyed by the poor in the UK and the US, but that is not enough as the social, health and political problems in both countries testify.

Privilege looks around and is satisfied knowing that the ‘have nots’ only have themselves to blame. They reach for the moral underclass theory and publish it relentlessly in their newspapers and commentary. They also have the wealth and political power to ensure this ideology is accepted by the poor themselves. However, many do not. In this context:

The losers get sick.

The losers get poor.

The losers get defeated.

The losers get mad.

The losers get even.

‘Many professions take losers as the object of their studies and as the basis for their existence. Social psychologists, social workers, nurses, doctors, social policy experts, criminologists, therapists and others who do not count themselves among the losers would be out of work without them. But with the best will in the world, their clients remains obscure to them: their empathy knows clearly-defined professional bounds’ (Enzensberger 2005). Enzensberger (2005) goes on to argue:

‘one thing is certain: the way humanity has organized itself – “capitalism”, “competition”, “empire”, “globalisation” – not only does the number of losers increase every day, but as in any large group, fragmentation soon sets in. In a chaotic, unfathomable process, the cohorts of the inferior, the defeated, the victims separate out. The loser may accept his fate and resign himself; the victim may demand satisfaction; the defeated may begin preparing for the next round. But the radical loser isolates himself, becomes invisible, guards his delusion, saves his energy, and waits for his hour to come’.

Shoots a Policeman, drives a truck through a crowd, blows himself up in an airport…..all the while privilege looks on in dumb uncomprehending horror calling for more security and economic crackdowns on the moral underclass upon whom the often middle class radical loser preys.

How responsible am I for my health 2

How responsible am I for my health?

 

The answer to that question from the dominant discourse is an overwhelming “very”.

This response sits alongside more scholarly understandings of the social determinants of health.  This ‘upstream’ understanding is open to ‘Lifestyle Drift’ , ‘downstream’, responses to health. Lifestyle Drift is:

“the tendency for policy to start off recognizing the need for action on upstream social determinants of health inequalities only to drift downstream to focus largely on individual lifestyle factors” (Popay et al 2010)

McKenzie et al (2016) argue:

“Although policy documents may state that the causes of poor health or inequalities in health are to do with poverty and deprivation, the interventions which actually operate on the ground focus much less (if at all) on changing people’s material circumstances and rather more on trying to change behaviours (which are in fact heavily shaped by material circumstances)”.

Nurses might understand the concept of the social gradient in health inequalities but drift into advocating lifestyle changes for the individual, centring around smoking, diet, and exercise messages.

So why is this happening? Why resort to lifestyle approaches to health when we know health is largely socially and politically determined?

 

One answer is that lifestyle answers fit within the neoliberal social imaginary which individualises health and social problems and seeks market solutions to those problems. Neoliberalism is a doctrine well known to many scholars and academics but is hardly mentioned in popular discourse.  To understand responses to health inequalities and poverty , we need to understand the tenets of neoliberalism underpinning much of current thinking:

 

  • Neoliberalism sees competition as the defining characteristic of human relations. Therefore competition between service providers should be introduced into the NHS.
  • It redefines citizens as consumers, whose democratic choices are best exercised by buying and selling, a process that rewards merit and punishes inefficiency. So patients can and should choose between hospitals and GP practices as consumers of health care using their purchasing power (not yet realised in the NHS). This way, poor service providers should go out of business.
  • It maintains that “the market” delivers benefits that could never be achieved by planning. Therefore NHS = bad, US private health insurance = good; BBC = bad,  SKY/Fox = good;  British Rail = bad, Great Western/Virgin = good; Royal Mail (state owned) = bad, Royal Mail (privately owned) = good.
  • Attempts to limit competition are treated as inimical to liberty. Thus socialised NHS service provision must be broken up to allow freedom in the market. The BBC must be sold off because it is unfair competition for Sky.
  • Tax and regulation should be minimised, thus the use of offshore tax havens, reduction in top rate of tax, mistrust of EU environmental standards and hatred of health and safety regulations.
  • Public services should be privatised. The Health and Social Care Act 2012 facilitates this, there may well be more to come for the NHS.
  • The organisation of labour and collective bargaining by trade unions are portrayed as market distortions, that impede the formation of a natural hierarchy of winners and losers. Unison, RCN, BMA etc, must have their power curtailed. The Junior doctors cannot be allowed to win or else it will be a victory for organised labour.
  • Inequality is recast as virtuous: a reward for utility and a generator of wealth, which trickles down to enrich everyone. Those at the bottom require incentives to better themselves, therefore benefits need cutting, those in the middle will benefit from wealth creation.
  • Efforts to create a more equal society are both counter-productive and morally corrosive. The market ensures that everyone gets what they deserve. The arguments from books such as ‘The Spirit Level’ are therefore irrelevant. If there is a social gradient in health then this is the natural outcome of people’s decisions and choices and any attempt to change this invokes  ‘moral hazard’ arguments; that is if people know they have a safety net (someone else takes the risk) they will not try to avoid poor choices.

(Monbiot 2016 The Zombie Doctrine)

 

 

 

Tory Rituals on poverty:

 

 

·         Blame the individual for their illness and poverty.

·         Benefits cause dependency , repeat this ad nauseam.

·         Deny any political responsibility for ill health, emphasise culture as causative.

·         Divide population into:  skivers v strivers, deserving v undeserving poor, low achievers v high achievers.

·         Deny the ‘social’ exists, there are only individuals

·         Privilege wealth through tax breaks and preferential treatment.

·         Deny one’s own privilege as a white affluent male.

 

 

These attitudes underpin the ideology of neoliberalism.

 

For a statement about what the Conservative Party should be about see:Direct Democracy – an agenda for a new model party’ (2005) especially the chapter on health:

 

 

“The problem with the NHS is not one of resources. Rather, it is that the system remains a centrally run, state monopoly, designed over half a century ago”.

 

 

 

All of this results in the politics of blame and shifting responsibility for health fully onto individuals.

If material health assets are paramount, poverty and our response to it is a foundation for understanding health in society. Poverty can be defined as 60% of the median income or using the ‘consensual method’  it is “enforced lack of necessities determined by public opinion”.

However, the UK government’s position is that poverty is not caused by lack of income. Based on Charles Murray’s idea of the ‘Culture of Poverty’, poverty is a result of individual deficits, as Kitty Jones writes:

“the poor have earned their position in society, the poor deserve to be poor because this is a reflection of their lack of qualities, poor character and level of abilities”.

Kitty Jones has written clearly on this issue in 3 blogs, which can be found here.

The alternative view, expressed in for example the ‘Greedy Bastards Hypothesis’ is that poverty, and health inequalities, is caused by the rich, often through unintended consequences of their actions but also through design. It results from structural socio economic conditions that neoliberal governments encourage: for example, low wages, withdrawal of benefit provision and the use of offshore tax regimes. Osborne’s ‘living wage’ is a cynical political manoeuvre designed to woo middling swing voters rather than to address structural economic issues such as under and unemployment , lack of investment in a green economy, deficits in the housing stock and affordability and a zero hours, self employed precarious job structure.

 

Nurses offering health advice, are not immune to this dominant discourse. It suffuses health advice on such sites as NHS choices and is supported by health campaigns which focus on changing individual habits. Action on social inequalities as root causes for ill health sits within specialised public health literature, for example ‘Fair Society,  Healthy Lives’, and unless nurses are exposed to an alternative perspective they will naturally draw upon dominant explanations for health inequalities. These are often either biologically/hereditarian explanations* or a ‘moral underclass discourse’ (Ruth Levitas) or a mix of the two. The politics of neoliberalism encourages the latter perspective.

 

 

Benny Goodman 2016

 

*See Chapter 4 in Psychology and Sociology in Nursing  Goodman 2015 for explanations.

Watch Richard Wilkinson discuss inequalities at a TED talk.

https://www.facebook.com/groups/Sociologyhealthnursing/

 

 

 

 

 

 

Poverty in Cornwall

The Bishop of Truro is asking 9 supermarkets for boxes to be placed in their stores so that customers can donate food. This is supported by the county’s foodbank scheme.

According to Professor Townsend, poverty is defined as:

“Individuals, families and groups in the population can be said to be in poverty when they lack the resources to obtain the types of diet, participate in the activities, and have the living conditions and amenities which are customary, or are at least widely encouraged and approved, in the societies in which they belong”.

The government defines poverty as a family with two children living on less than £300 a week (BBC 2011). The Child Poverty Action group state that a measure of poverty is where household income is below 60 per cent of the median UK income after housing costs have been paid.

In June 2011 Cornwall council’s  Deprivation and Child Poverty report showed 19% (16,650) of under-16s living in poverty. Levels ranged from 2% in some areas to 58% on the Pengegon estate in Camborne.

Poverty therefore does not explain rioting, where are the street protests at this level of deprivation which equals that found elsewhere in the UK? This shows that simple cause-effect explanations for human behaviour are not adequate. Instead we must look to fuzzy analyses and solutions and come to understand that certain behaviours have different antecedents and require different tipping points. Poverty needs other variables which are not always measureable. Camborne as far as I know does not have a history of racial tension, police stop and search or gang culture. Neither does it have conspicious consumption and ostentatious privilege on show, the poorer areas do not sit cheek by jowl with Mansions. We would have to ask residents why they have not kicked up at this continuing level of disparity. Do they expect less? Have they internalised failure, are they ‘all in this together’?

Townsends definition perhaps illuminates. If poverty is experienced in relation to the ‘societies in which they belong’ then it may be posited that camborne society is sufficiently poor and cut off from privilege that residents do not feel excluded as they have little experience (apart from media projections) of social wealth? What protects camborne from looting? Poverty is certainly there but what is missing to turn this experience into social unrest?

Oh, by the way…donating food? In the UK ? Are we mad? What is it about society and people that we may think it necessary to donate food? Before you answer that, have you experienced living on 60% the median wage with two children for, say a year?