So Just How Fucked Are We?
Danny Dorling, Inequality and the 1%
Verso, 240pp, £12.99, ISBN 9781781685853
reviewed by Luke Davies
According to Professor Danny Dorling, Halford Mackinder Professor of Geography at the University of Oxford: pretty fucked. Inequality and the 1% is more of a statistical overview than a polemic. Published towards the end of last year, now seems like a good time to remind ourselves of its existence. Because it’s devastating. And because it’s full of sober, irrefutable data analysis – it is a product of research, with 50 pages of footnotes. In other words, not the kind of public school debating society fare that characterises the high end of Tory rhetoric, and which justifies policies that even the IMF would brand as economically disastrous Milton Friedman-lite.
Dorling’s main preoccupation is the rich – and specifically the richest 1%, picking up on the famous Occupy slogan coined by David Graeber. He does a decent job of pointing out just how insanely wealthy this group have become, and how rapidly in recent years their wealth has accelerated. Citing recent data releases from the Office for National Statistics, Dorling shows that the earned and unearned income of the UK’s top 1% is £110 billion. The imbalance is such that this group have 53% of the total personal tradable wealth in the UK. And this is just the tip of the iceberg. Referencing a much talked about and publicly verified 2014 Oxfam Briefing Paper, Dorling states that when financial wealth is taken into account, the top 1% globally hold some $100 trillion – ‘or sixty-five times the wealth of the poorest half of humanity.’ Re-read that last sentence.
Imbeciles and villains at this point refer to the OCR revision guide theory of trickle-down economics. Which is an idea that’s easy enough to understand, because its central tenet is a simple visual metaphor – but which is also, unfortunately, unsupported by fact. For the reason that without progressive fiscal policies and state spending, the overwhelming majority of what wealth is generated by the rich isn’t distributed – it’s simply hoarded, as Dorling’s figures so powerfully illustrate. For example: 50% of the population share only 6% of the total wealth between them all. The wealth of the poorest half of the world’s population is the equivalent of that belonging to the 85 richest. As Thomas Piketty demonstrated in Capital, the rich are getting a lot richer, and the remainder are being squeezed out of the deal. Buying stuff and sitting on it turns out to be a lot more profitable than most job-creating activities. The result is a situation, recently described by Paul Collier and by Andrew Sumner, in which a billion people living on less than a dollar a day are set to remain as they are. A situation, analysed in a recent study by Matthew Rimmer, Thomas Pogge and Kim Rubenstein, within which 30% of human deaths are caused by communicable diseases easily treated among the affluent.
Dorling’s book is especially good at showing the exacerbating effects of non-progressive tax policies within a UK context – targeting the Tory government as a prime culprit for facilitating stifling inequality. He writes: ‘Cameron raised taxes by 17p for every 83p Osborne cut, and he raised them mostly through VAT – a regressive tax that taxes a higher proportion of your income the poorer you are – rather than through the income of the rich’. And of course he attacks the 19 billion spending savings that went hand in hand with these tax cuts – reserving a special horror for the five billion cut from incapacity benefit for the disabled. Dorling also points to the real terms fall in wages of 15% in 2012/3 in the UK, and to the Institute of Fiscal Studies’ prediction that by 2020 a quarter of all children will be living in poverty. He pulls no punches in assessing the risk to our health of endemic inequality such as this, citing figures released by the Child Poverty Action Group showing that by the summer of 2013 an extra 23,400 people had died in the UK – attributable not to flu (as the president of the Faculty of Public Health, John Ashton, has verified) but to spending cuts.
Dorling has no difficulty finding voices to back his basic contention that policies designed to perpetuate inequality are a threat to humanity. For instance, he quotes a report by the World Economic Forum – ‘a body of some 700 global experts’ – and their assessment of the damaging economic effects of inequality: ‘The chronic gap between the incomes of the richest and poorest citizens is seen as the risk that is most likely to cause serious damage globally in the coming decade.’ Above climate change. Above all conflicts put together.
This book is, in short, a catalogue of catastrophes – present and imminent – drastically worsened by non-distributive fiscal and welfare policies. It presents a viewpoint widely accepted outside of the US and UK – and by Nobel prize winning economists from Paul Krugman to Joseph Stiglitz – that recessions can only be remedied by significantly higher rates of taxation and significantly more government spending, and that penalising the poor and advantaging the wealthy in the middle of such a crisis is tantamount to genocide.
Yet while Dorling’s book is great for providing a succinct account of why the Tories and their kind are literally harbingers of death – it is also an example of how woefully inadequate responses on the left can be. Given his devastating description of the present situation and his forecasts for the future, it is more than a little disheartening to read Dorling conclude by speaking of the need for a ‘slow revolution,’ and expressing optimism at Obama’s efforts to raise top rate taxes to 39.6%.
This optimism seems especially misguided in the context of what has just happened. In case you need reminding – 40% of the British electorate just voted for the Tory party, 30% for Labour, 12% for UKIP and 8% for the Liberal Democrats. In other words: 90% of the British electorate voted for parties who prioritised deficit reduction, campaigned on the need for further cuts and subscribed to the narrative that Gordon Brown’s government was somehow responsible for the global economic downturn.
There is no other way of describing that situation than as batshit crazy.
It also seems to undermine the contention that we might be gradually moving in the right direction. Dorling’s conclusions are typical of the dumb buoyancy of the left both in the lead up to and in the aftermath of this election. As if Ed Balls offering a 50p top rate tax, alongside controls on immigration inscribed on an inert rock, was something about which to be hopeful. As if it’s OK that the only party pushing policies that even come close to addressing the spiralling inequality and climate change issues that hordes of prominent economists and climate scientists are desperately pleading for action on, is a single-issue organisation that obtained only one seat.
This book so very obviously points to the need for a radical intervention – of the kind that concessionary and ameliorative party politics actively hinders by substituting (at best) the bare minimum for direct action. As has just been decisively proven by the election campaign, result and aftermath (with Chuka Umunna and Tony Blair now calling on the Labour Party to lurch even further to the right) – it seems clear that the change required will not be achieved with the help of the British electorate anytime soon. Inequality and the 1% is – just like Naomi Klein’s latest book, Piketty’s, and so many others recently published by intellectual heavyweights who present-day parliamentary politicians simply ignore – a drastic plea for action. If only, in common with most on the left today, it didn’t desperately cling onto the hope that gradualism can fix the problems we face.
Dorling’s main preoccupation is the rich – and specifically the richest 1%, picking up on the famous Occupy slogan coined by David Graeber. He does a decent job of pointing out just how insanely wealthy this group have become, and how rapidly in recent years their wealth has accelerated. Citing recent data releases from the Office for National Statistics, Dorling shows that the earned and unearned income of the UK’s top 1% is £110 billion. The imbalance is such that this group have 53% of the total personal tradable wealth in the UK. And this is just the tip of the iceberg. Referencing a much talked about and publicly verified 2014 Oxfam Briefing Paper, Dorling states that when financial wealth is taken into account, the top 1% globally hold some $100 trillion – ‘or sixty-five times the wealth of the poorest half of humanity.’ Re-read that last sentence.
Imbeciles and villains at this point refer to the OCR revision guide theory of trickle-down economics. Which is an idea that’s easy enough to understand, because its central tenet is a simple visual metaphor – but which is also, unfortunately, unsupported by fact. For the reason that without progressive fiscal policies and state spending, the overwhelming majority of what wealth is generated by the rich isn’t distributed – it’s simply hoarded, as Dorling’s figures so powerfully illustrate. For example: 50% of the population share only 6% of the total wealth between them all. The wealth of the poorest half of the world’s population is the equivalent of that belonging to the 85 richest. As Thomas Piketty demonstrated in Capital, the rich are getting a lot richer, and the remainder are being squeezed out of the deal. Buying stuff and sitting on it turns out to be a lot more profitable than most job-creating activities. The result is a situation, recently described by Paul Collier and by Andrew Sumner, in which a billion people living on less than a dollar a day are set to remain as they are. A situation, analysed in a recent study by Matthew Rimmer, Thomas Pogge and Kim Rubenstein, within which 30% of human deaths are caused by communicable diseases easily treated among the affluent.
Dorling’s book is especially good at showing the exacerbating effects of non-progressive tax policies within a UK context – targeting the Tory government as a prime culprit for facilitating stifling inequality. He writes: ‘Cameron raised taxes by 17p for every 83p Osborne cut, and he raised them mostly through VAT – a regressive tax that taxes a higher proportion of your income the poorer you are – rather than through the income of the rich’. And of course he attacks the 19 billion spending savings that went hand in hand with these tax cuts – reserving a special horror for the five billion cut from incapacity benefit for the disabled. Dorling also points to the real terms fall in wages of 15% in 2012/3 in the UK, and to the Institute of Fiscal Studies’ prediction that by 2020 a quarter of all children will be living in poverty. He pulls no punches in assessing the risk to our health of endemic inequality such as this, citing figures released by the Child Poverty Action Group showing that by the summer of 2013 an extra 23,400 people had died in the UK – attributable not to flu (as the president of the Faculty of Public Health, John Ashton, has verified) but to spending cuts.
Dorling has no difficulty finding voices to back his basic contention that policies designed to perpetuate inequality are a threat to humanity. For instance, he quotes a report by the World Economic Forum – ‘a body of some 700 global experts’ – and their assessment of the damaging economic effects of inequality: ‘The chronic gap between the incomes of the richest and poorest citizens is seen as the risk that is most likely to cause serious damage globally in the coming decade.’ Above climate change. Above all conflicts put together.
This book is, in short, a catalogue of catastrophes – present and imminent – drastically worsened by non-distributive fiscal and welfare policies. It presents a viewpoint widely accepted outside of the US and UK – and by Nobel prize winning economists from Paul Krugman to Joseph Stiglitz – that recessions can only be remedied by significantly higher rates of taxation and significantly more government spending, and that penalising the poor and advantaging the wealthy in the middle of such a crisis is tantamount to genocide.
Yet while Dorling’s book is great for providing a succinct account of why the Tories and their kind are literally harbingers of death – it is also an example of how woefully inadequate responses on the left can be. Given his devastating description of the present situation and his forecasts for the future, it is more than a little disheartening to read Dorling conclude by speaking of the need for a ‘slow revolution,’ and expressing optimism at Obama’s efforts to raise top rate taxes to 39.6%.
This optimism seems especially misguided in the context of what has just happened. In case you need reminding – 40% of the British electorate just voted for the Tory party, 30% for Labour, 12% for UKIP and 8% for the Liberal Democrats. In other words: 90% of the British electorate voted for parties who prioritised deficit reduction, campaigned on the need for further cuts and subscribed to the narrative that Gordon Brown’s government was somehow responsible for the global economic downturn.
There is no other way of describing that situation than as batshit crazy.
It also seems to undermine the contention that we might be gradually moving in the right direction. Dorling’s conclusions are typical of the dumb buoyancy of the left both in the lead up to and in the aftermath of this election. As if Ed Balls offering a 50p top rate tax, alongside controls on immigration inscribed on an inert rock, was something about which to be hopeful. As if it’s OK that the only party pushing policies that even come close to addressing the spiralling inequality and climate change issues that hordes of prominent economists and climate scientists are desperately pleading for action on, is a single-issue organisation that obtained only one seat.
This book so very obviously points to the need for a radical intervention – of the kind that concessionary and ameliorative party politics actively hinders by substituting (at best) the bare minimum for direct action. As has just been decisively proven by the election campaign, result and aftermath (with Chuka Umunna and Tony Blair now calling on the Labour Party to lurch even further to the right) – it seems clear that the change required will not be achieved with the help of the British electorate anytime soon. Inequality and the 1% is – just like Naomi Klein’s latest book, Piketty’s, and so many others recently published by intellectual heavyweights who present-day parliamentary politicians simply ignore – a drastic plea for action. If only, in common with most on the left today, it didn’t desperately cling onto the hope that gradualism can fix the problems we face.