Increaseing poverty is bad news for us all….
Today’s report by the Institute of Fiscal Studies which predicts sharp declines in income and increasing poverty is bad news for those involved. However, and the left doesn’t make this point often enough, it is also bad news for the economy and therefore the rest of us. Even if we are not drawn into the poverty trap ourselves (which is unlikely given how wide it is currently opening its cavernous maw) then it should go without saying that we will all be hit by the economic consequences of falling spending, unemployment, falling tax revenues etc.
You would hope that the moral and democratic case for creating a more equal society is pretty much un-arguable. However, the right often retreats into pseudo-science to justify its economic positions and the left continues making the moral and democratic case, without addressing the rationalist case against unequal societies. Books like The Spirit Level outline a strong case that far from being beneficial to society, the rampant inequality that capitalism naturally creates is deeply damaging to our social fabric and well-being as individuals.
Labour needs to stop being afraid of talking about inequality and stop being afraid of talking about the obvious deficiencies of capitalism. It beggars belief that people still think ‘capitalism works’ when everything happening shows the exact opposite. It gives us unsustainable booms followed by ruinous busts – this is always has been the way and always will be the way until its replaced with a more democratically organised and therefore equitable social system. Maybe people who think capitalism works would care to enlighten the rest of us as to how it is working for those people mentioned in the IFS report today.
We should also not be constrained by what we can do nationally (though obviously, making progress on a national level is our ultimate aim). Islington Council seems to be taking some laudable measures which other Labour administrations could emulate. However, they in and of themselves show the limitations of what local authorities can achieve – nonetheless, something is better than nothing. We need to stop being shy of making radical arguments about the absolute necessity of ending inequality and we need to stop naively insisting ‘capitalism works’ – a conviction born of irrational faith rather than the product of hard, objective fact. In short, we need to complement a moral and democratic case against capitalism with a rational one which shows an alternative is not just possible, but it is also an actual necessity if we want all of society to prosper.