Growth in inequality

by John Hayward

Today’s report from the National Equality Panel disturbingly begins ‘Britain is an unequal country, more so than many other industrialised countries and more so than it was a generation ago.’

Its charts stress how ‘since the late 1980s income inequality has remained much higher than in the 1960s and 1970s; on some measures it is the highest in last 50 years’ and ‘The UK had income inequality in the highest quarter of industrialised countries in the mid-2000s’:

The report acknowledges that a fundamental aim of people with widely differing political perspectives is to achieve ‘equality of opportunity’. However, this will be difficult for any government to achieve if it does not know the causes of inequality. Unfortunately, a report published last month by the Government Equalities Office, Accounting for changes in inequality since 1968: decomposition analyses for Great Britain, makes clear that the main factor responsible for the increased inequality of recent decades remains unaccounted for:

Which rather begs the question, if we don’t understand the cause, how can we begin to address the problem? We invite your ideas but, as a starter, I am reminded of one of our former Cambridge Papers, Render unto Caesar? The dilemmas of taxation policy:

‘The biblical material suggests that a limited role for the state combined with a range of alternative welfare support mechanisms is desirable … The belief that free-market capitalism will generate economic growth which will ‘trickle down’ to improve everybody’s lot and ‘welfare pluralism’ – involving employers, markets and voluntary organisations – will fill the welfare gap has so far proved optimistic. While this strategy may enhance the income levels of the poorest in absolute terms, relative inequality is often more marked and this undermines wellbeing.’

Share this post on your network

Tags: , , , , ,

Category: Blogs

January, 2010

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.