Problems of predistribution…..
If nothing else, Ed Milliband has got people within the Labour Party talking with the announcement that ‘predistribution’ will form the cornerstone of Labour’s new economic strategy. Rob Marchant takes aim at the proposals over on LabourList while Eoin Clarke vigorously defends them here. Meanwhile, Mark Feguson has expressed some trenchant and relevant points here. Essentially, Mark is right, there is no space within the predistributive agenda for those who are not in work. It almost assumes full employment as an a prirori fact. However, we do not live in a economy with anything close to approaching conditions of full employment. Indeed, we live in a country with a labour market that is skewed too heavily in favour of employers and is heading in the opposite direction to being a full employment economy. Because the fundamental premise of predistribution is that you use market mechanisms to distribute wealth, if the labour market is in its current condition there is absolutely no chance of predistribution having anything other than a nominal effect on those in work and those out of work, as we have already said, are essentially excluded from the process.
On a related point, predistribution does nothing to establish the real root cause of such uneven wealth distribution in the British economy, namely private ownership. The point here is that while private ownership remains the norm, you can haul those at the bottom up all you like, they will still be an increasing distance behind those at the top. Labour, and indeed advocates of predistribution need to talk an awful lot more about the social nature of wealth creation and the necessity of its social ownership and distribution. This would also bring them in-line with core Labour values as well and give them a much stronger hand to play against economic hawks like Mr Marchant.
Mr Marchant is taking aim at the idea from the right. He wants us to adopt a dry economic plan which would be little better than Osborne-lite (incidentally, it would also do nothing for the economy). However, there are serious questions that predistributers need to properly answer. If they dont it is going to end up being just another empty buzzword, that will eventually be cast to the side when something potentially more sexy is conjured up.