Equal Incomes Often Mean Equal Poverty

My heart, normally a steely organ, twitched with compassion this week at the terrible news that inequality in Britain is at its highest since the Second World War.

My sympathy was not for all those poor victims of inequality, forced to stand by as the evil rich trough truffles and burn fivers. No. My heart went out to all those employed by the equality industry.

Just imagine the horror. They have spent more than a decade trying to “mainstream equality” (a phrase I have borrowed from the website of the Improvement and Development Agency, where it sits proudly next to my second favourite — the Equality Framework Evidence Collection Tool, or “ef:ect”). All that time, all those jobs, all those lovely new acronyms filled with pointless punctuation marks. Then Harriet Harman made the mistake of commissioning a report from researchers at the London School of Economics. It all turns out to have been a colossal waste of time and money.

Britain remains a hugely unequal society. It bulges with billionaires, who squat atop the rest of us, laughing as we faff about paying tax bills and getting by. But two things utterly confuse me. Why is this inequality inherently bad, and what does an equal society look like?

As long as the poor have not been getting poorer, which they clearly have not, and everybody’s standard of living is rising, why does it matter that the rich are getting richer? So what? Of the top twenty billionaires in The Sunday Times Rich List, more than half are self-made. Why do we begrudge them their success?

The central contention of the report is that inequality is at its highest since the war. In what screwed-up, quango-ish world does anyone think that we were better off in the 1940s, when everyone was broke, rationed and enslaved to a non-consumerist domestic drudgery?

As the historian David Kynaston describes it in Austerity Britain: “There were still many appalling Victorian slums in the major cities and large pockets of overcrowded, inadequate-to-wretched housing almost everywhere. About seven million dwellings lacked a hot-water supply, some million an inside WC, almost five million a fixed bath.”

Still, at least they were all in it together, albeit a tad whiffy.

The problem is not the existence of inequality, but the absence of social mobility. It matters not one jot that Sir Philip Green has a yacht and you have a plastic bath duck. What matters is that the conditions exist to allow you to work towards yacht ownership if that is what you want. Aspiration and education are everything in this debate, not handwringing about some notional measure of inequality.

How do you legislate towards a more equal society anyway? What does it look like? Perhaps it means taxing the rich out of existence, or at least forcing them overseas, so that the only people left are those whose income Ms Harman approves off. Perhaps it means more state handouts, so that aspiration becomes irrational. Rich white men live longer. That is just so unequal. Do we need means-tested euthanasia for the over-65s? Let’s all mainstream some equal mortality figures.

There is a chilling sentence in the government response to the report. “The report confirms the view that the Government is the only agency that has the capacity to take the action required to reduce inequality — through tax, benefits and public services.” Did we read the same report? The great new Labour project has presided over this growth in inequality — and a far more serious stagnation in social mobility — and the answer is more of the same.

One measure of inequality is called the Gini coefficient — where 0 implies everyone is paid the same, and 1 is complete wealth disparity. Our Gini rating is 0.34. In 1956, before the Revolution, Cuba weighed in at 0.57; an example of income inequality where it actually matters — in a country where the poor are starving and illiterate. After the revolution, when private capital was abolished, the Gini slid to 0.22 by 1986; and, viva la revolución, everyone was equally miserable and clinging to rafts heading to Florida.

I once spent an afternoon on a beautiful beach in Cuba. A local gave us a lift back into town, and told us that there had once been a fishing village where we had slung our hammocks. Raúl, Fidel Castro’s brother, had razed it because of its thriving black market, and because he wanted to build a hotel for fat Western tourists. The villagers, whose internal black market probably meant a local Gini coefficient of substantially more than 0.22, were rehoused in a tower block in town. Many threw themselves to their deaths in despair.

Cuba no longer has reliable figures for the Gini ratio, because the figures are so skewed by those with access to dollars. Those stuck with pesos are equal in their poverty; no matter how well educated or how hard working. Cuba’s economy is about official equality and unofficial reality.

It’s a funny thing about the human spirit: we will find a way to be unequal, no matter how hard an interventionist state tries to stop us.

Ms Harman spent £400,000 on the report, which must have made her and her chums in the equality industry pretty glum. She should spend the next pointless £400,000 on a holiday for them in Cuba, to see equality at work. Or she could just stop trying to “mainstream” agendas and start tackling our failing schools.

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