21st century Britain is highly peculiar. Perhaps ‘unique’ would be the correct terminology. As John Curtice has argued, this description hails from the fact that violent extremes of poverty and wealth coexist in a seemingly incongerous framework. In 2010, inequalities in health, income and wealth in the UK became the fourth highest of the 25 OECD countries; higher than Japan, Norway, Germany, Canada and Australia. Even higher than inequalities in Israel.
The evolution of Britain’s exceptional inequalities owed much to 2008. Such a seismic shock to the global economy, as well as the birth of UK Uncut and the Occupy movement, should have brought about wholescale change. Not just the curbing of financial malpractice but also a widespread reassessment of the way our economy is structured. Even the most pessimistic commentators anticipated at least gradual change; a move away from low pay, low regulation, low taxation. From a plutocratic financial paradigm to a mixed, balanced system based on wage growth and manufacturing innovation to bring about the end of regional and class differentiation.
After years of rapid growth, only amassed by those at the top (pointed out by the FT in 1994), one hoped that the trend of elite exuberance was over. We have seen a reverse. The moment for change was quelled. The gap has widened. The UK is set to retain its position as the most unequal country in developed Europe. After 2008, the top 1% took 14% of wealth; the next 10% took another 14%. At 28% this is higher than anywhere in Europe. Danny Dorling speculates that Britain will become the most economically unequal country in the rich world in the next ten years, if this trajectory remains unchallenged. If the economy only serves the richest; supplying stagnation for the rest, why aren’t we seeing challenges and protests on our streets? This is the normalisation of the abnormal.
Within such a scenario, the state of exception becomes the state of being. A rise in homelessness, such as that seen since 2008, is reframed as simply the way the world works. Even more worryingly, the rise in mortality rates since the crash has been unchallenged; in fact it rarely makes the headlines. In 2013, it was revealed that 8,534 more elderly people died in 2012-13 than in 2011-2012. Flu only made up around 5% of these deaths. It was later revealed that some 5,000 more people in 2012 had not received the home care visits they required, due to local cuts and the tendering out of services. Behind each death there is a question mark. Behind this question mark is a cut. Behind the cut is a political action which has become the new common sense.
The rise in food poverty, which has corresponded with the proliferation of offshore asset hoarding, only serves to strengthen this point. Food banks or soup kitchens have been a rareity in British history. During the post-war consensus, when all forms of inequalities fell, they were an anomaly. Their usage in 2008-09, according to the Trussell Trust, was 25,899. This figure rocketed during the coalition years, reaching 1,109,209 in 2015-16. This is a shocking indictment of austerity, and should be the source of national shame.
Yet, rather than being seen as exceptional and unacceptable, food bank usage has been amalgamated into the ordinary; the way things have to be. Some sections of the general public see foodbank usage not as a result of hardship, but remarkably because of ‘benefit fraud’ and working-class ‘rent-seeking’. The government’s pernicious anti-welfare narrative has stuck. Erroneous ideas can be powerful, especially when they are repeated enough.
This can be juxtaposed with the revelations of offshore wealth and wholesale tax avoidance in the Panama Papers. According to Gabriel Zucman, around 8% of global household wealth is held in tax havens. The Office for National Statistics and the Federal Reserve stipulates that global household financial wealth amounts to £95.5 trillion; of this Zucman estimates that around £7.6 trillion of this is protected offshore. This is a huge sum. The total debt of Greece, central to the current Eurocrisis, is only £350 billion.
For a point of comparison regarding the sorry state of British democracy, one only needs to look to Iceland. Not only did they take a radically different approach to the 2008 crisis, but popular protests forced the Icelandic Prime Minister to resign from power for his implication in tax avoidance. Such popular awareness and engagement is absent in the UK. Extreme poverty exists alongside extreme wealth. Civil society is demobilised, whilst corporate domination is legitimated and normalised. The tax haven and food bank are both images of the structural deficiency of democracy this country faces.
How do we tackle this? The democratisation of economic information would be a start. The financial practices of large companies are highly illusive, complex and hidden from the sight of the general public. This is not inevitable; it has been designed. By shrouding money in secrecy, it’s hoped that people will accept an exceptional situation. If people fully comprehended the gravity of tax avoidance they would surely be morally repelled – and would certainly not stand for the maintenance of such arrangements. By democratising financial information, a meaningful and honest discussion may be had. Economics is highly politicised; it’s an elite sport played under an illusion of professionalism. Maybe by puncturing this bubble we will all start to talk about these issues, and maybe then things will start to change.
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