Rising inequality making a ‘mockery of democracy’

Rising inequalities in Britain are making a ‘mockery of democracy’, the Institute for Fiscal Studies (IFS) has warned.

The IFS has today (14 May) launched a new review, which it claims will be the ‘comprehensive scientific analysis of inequalities’ yet attempted.

The review will be chaired by the Nobel Laureate Professor Sir Angus Deaton and funded by the Nuffield Foundation.

A preliminary report into the subject warns the situation in the UK is so bad that it is in danger of following the US, where wages for non-college-educated men have not risen for five decades.

According to the report, after a decade of stagnant wages in the UK there is recent evidence that ‘deaths of despair’ – deaths from suicide and drug and alcohol abuse – are now rising among middle-aged Britons.

‘I think that people getting rich is a good thing, especially when it brings prosperity to others,’ said Sir Angus.

‘But the other kind of getting rich, “taking” rather than “making”, rent-seeking rather than creating, enriching the few at the expense of the many, taking the free out of free markets, is making a mockery of democracy. In that world, inequality and misery are intimate companions.’

The report also warns there are ‘stark’ geographical inequalities in the UK, withaverage weekly earnings in London two thirds (66%) higher than those in the North East.

And it adds men in the most affluent areas can expect to live nearly 10 years longer than those in the most deprived areas, and this gap is widening.

It also found that while white British women have nearly closed the employment gap with men, Pakistani and Bangladeshi women are half as likely to work as men of the same ethnic group.

The IFS study follows the UK Powerhouse study by law firm Irwin Mitchell and the Centre for Economics and Business Research (Cebr), which claimed in particular the economic gap between the South East and the North will wide one year after Britain leaves the EU.

‘I can’t think of anything more important than understanding what drives the inequalities we see today and working out what we might do to influence them,’ said IFS director, Paul Johnson.

‘Everything from early childhood education to the regulation of “big tech”, from the design of the benefit system to the effects of globalisation, from the role of men and women in the home to the design of corporate governance, matters for producing the outcomes we see. We will be examining them all.’

Photo by Schuldnerhilfe (Pixabay)