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We hear this phrase uttered a lot as a partial explanation of what is wrong with our society. But how bad is the problem?
You can go here - http://www.poverty.org.uk/09/index.shtml - for a lot of interesting stats. But the most interesting one is this image which I reproduce here:
This is the change of income in real terms (ie. after inflation, so real purchasing power) and it shows quite clearly the poorest 10% getting significantly poorer. (Apparently the 10% mark is about £120 gross income per week.)
But going the other direction, it's not just the rich getting richer. It's the 'relatively well-off', the 'average', and the 'fairly poor' all getting richer too. This doesn't match the usual narrative! In particular you can make an argument based on these figures that almost the whole country can afford to contribute more towards helping those at the bottom, not just the mega-rich. Ed Miliband's focus on the "squeezed middle" seems a little silly when you see that the middle is actually doing pretty damn well.
Another interesting stat on that page is that the income gap between the top 10% and the median is growing, but more slowly than the gap between the median and the bottom 10%. And maybe that matches in some way what we saw on the streets last week - not the poor angry at the mega rich (who they never see anyway), but at the average person, who might be considered working or lower middle class, but whose lot in life has improved significantly over the last 15 years compared to those on social security.
It also means that while there is still an argument for taxing the rich, there is perhaps more of an argument for taxing everybody but the poor, especially if the inequality is bigger between the bottom and the middle than between the middle and the top. Raise the 20% basic income tax rate to 21%?
You can go here - http://www.poverty.org.uk/09/index.shtml - for a lot of interesting stats. But the most interesting one is this image which I reproduce here:
This is the change of income in real terms (ie. after inflation, so real purchasing power) and it shows quite clearly the poorest 10% getting significantly poorer. (Apparently the 10% mark is about £120 gross income per week.)
But going the other direction, it's not just the rich getting richer. It's the 'relatively well-off', the 'average', and the 'fairly poor' all getting richer too. This doesn't match the usual narrative! In particular you can make an argument based on these figures that almost the whole country can afford to contribute more towards helping those at the bottom, not just the mega-rich. Ed Miliband's focus on the "squeezed middle" seems a little silly when you see that the middle is actually doing pretty damn well.
Another interesting stat on that page is that the income gap between the top 10% and the median is growing, but more slowly than the gap between the median and the bottom 10%. And maybe that matches in some way what we saw on the streets last week - not the poor angry at the mega rich (who they never see anyway), but at the average person, who might be considered working or lower middle class, but whose lot in life has improved significantly over the last 15 years compared to those on social security.
It also means that while there is still an argument for taxing the rich, there is perhaps more of an argument for taxing everybody but the poor, especially if the inequality is bigger between the bottom and the middle than between the middle and the top. Raise the 20% basic income tax rate to 21%?
