This depressing graph from the ONS shows that UK households’ outgoings have surpassed their income for the first time since 1988 (that year was in fact only just in negative territory). These figures show that in 2017 the average household experienced a £900 shortfall.
Yet nowhere in the media does this have much prominence and nowhere is it pointed out that when the government reduces its spending, then other people in the economy have to borrow to make up for the loss. Nowhere is it pointed out that that is why the economy is in such a parlous state and going nowhere. Building your economic demand on the basis that people will be borrowing an extra £900 in a year is mismanagement on an epic scale – it is dire for the proper functioning of the economy. Which is why, when there is such a diminishing prospect of improved, sustained demand, the UK economy has so little private investment and fails to provide opportunity for most members of society.
Additionally, such spending in the public currency that does take place, is increasingly directed away from the general electorate and instead towards private companies, making a minority much richer at public expense. So now it is theoretically possible for frauds committed by G4S to result in an arrest arranged by G4S to be held in police custody by G4S and upon conviction be sent to a prison run by G4S. Surely I cannot be alone in considering that it would be way more efficient if we cut out the middleman and they ran the judiciary as well?
The Economist points out a further problem – “As inequality grows so does the political influence of the rich”:
“Squeezing the top 1% ought to be the most natural thing in the world for politicians seeking to please the masses. Yet, with few exceptions, today’s populist insurgents are more concerned with immigration and sovereignty than with the top rate of income tax…..
But studies of the relation between democracy and levels of inequality point in conflicting directions. Mr Acemoglu and Mr Robinson tackle the question in another paper, co-written with Suresh Naidu and Pascual Restrepo. They conclude that democracies raise more taxes than non-democracies do. But this does not translate reliably into lower levels of income inequality.”
Interesting that democracies seem to raise more in tax – that suggests that they been captured by the tax and spend ‘misunderstanding’. We can also see how successful the diversionary methods of identity politics have been. It’s anti-semitism or your immigrant Polish neighbour which is the problem, never Mr 1% prosperously installed somewhere off Park Lane, hobnobbing with the powerful in return for a comfortable contribution to Conservative coffers. It is gang violence from the underclass that is the problem, not the cutting away of social and financial support to the areas where gang violence seems now to occur.
The article concludes:
“The evidence that concentrated wealth contributes to concentrated power is troubling….If political leaders tried it, they might well find that redistribution is a winner at the ballot box.”
They might indeed, but getting that message across with the state of British media and with the simultaneously clouding and toxic activity of Brexit is proving remarkably difficult.
The state it seems to me, is certainly failing, but there are meanwhile, so many useful diversionary tactics to explore properly first.