Wealth inequality - we've been fooled

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I've read loads of threads recently about benefits: cuts, caps etc.It's all over the newspapers too. There's a massive sentiment that austerity is necessary, we can't afford a generous welfare system, benefits should only provide the most basic of needs. Without going into why we seem to accept all this without question, why is there so much focus on how much the poorest people have, and no focus at all on how much the richest have? The product of all the austerity propaganda seems to be that we've forgotten the massive increase in inequality in this country, that only the very richest benefit from.

inequalitybriefing.org/

So people in the middle bitch about the people at the bottom, but no-one seems to notice the people at the top creaming off all the profit. This affects everyone. Living standards of the very poorest and also those in the middle. We should be really angry about this. 20 years ago a professional, like a doctor or teacher, could afford a good family house in London and private education for their children. But wages have stagnated and living costs have rocketed, we're all worse off except for the very wealthiest.

I feel like there's a huge amount of focus on benefits scroungers, immigrants and none on what we can do to stop the gap between rich and middle/poor getting bigger and bigger and bigger. AIBU?

Hang on - I may have figured it out. 42 million adults, in which case your 420,000 makes up 1% of adults, not earners.

Still interested in how the mean income for that 1% is derived, and how it has captured tax planning and avoidance, if you're able to provide that data?

Plarail, I'm not a Marxist. Though his one liners were really funny. Good old Groucho. I broadly think capitalism is fair, so it would be nice if we replaced the current system with it, but take the massive profits out of public services such as power, transport, banking, health, water and council services.

If you think what we have atm is capitalism you're deluded. The world is being run for the benefit of the multi-national corporations, and until governments stand up to them it always will be and we'll be forced into corporate led war after corporate led war, the poor, the disabled and immigrants will be blamed for societys ills and we will be pitted against one another. It's not the rich who are the problem, it is corporate greed, and a system which rewards short term gain which always turns to long term loss.

I say we don't fine the banks that committed multiple frauds on massive scales, we put the bosses and those who cooked up the crimes in prison. They face no personal sanction, unlike the FIFA executives arrested in Zurich for much the same crime, though on a far smaller scale.

Dove - I'm just shocked that it's allowed. This level of waste is unacceptable and any profits generated by the housing authority should either go back into providing housing for those in need or be returned to the taxpayer. I consider myself to be conservative and I think many people have similiar view points to me. I know I come from a screwed up family that offered great privilege and without that money things would be very different today.

As for the HA employee, it's obvious to me that if you can let someone go to Uganda to volunteer they must have excess staff. Rather than go ape on benefits why not cut back on the expenses first and then review benefits.

TheWordFactory - didn't see your post before, totally agree that Ed Miliband lumped in billionaires with people earning just above the 40% tax rate! It was very odd.

DoctorTwo - I feel that's where capitalism - and shareholding to some extent - has led us - a place where governments exist to please private companies. If this isn't capitalism according to economic theory - although I'm confused by that idea to be honest - then it is the reality. I seem to remember growing up thinking the UK was a mixed economy. It so isn't now and that's a huge part of this problem. I recently heard even Margaret Thatcher was against privatising the railways and I can see why.

That said, I do think we need new debates. I think it often turns into a conversation about Labour vs Conservative, right vs left, socialism vs capitalism etc. It's all the convenient terminology the press love, of course, but I don't think it helps the conversation.

Also DoctorTwo, you mention corporate greed - I agree it's not "the rich" who are the problem, but those who have benefited from corporate greed are very rich and when people talk about "the rich" they often mean those people.

I was reading about the Poplar Rates Rebellion recently and my jaw dropped. I can't imagine our MPs or councillors standing up for us like that now.

I think this should be our w/e reading...www.amazon.com/The-Price-Inequality-Divided-Endangers/dp/0393345068

This chap has been on TV all week. Some of what he says is very interesting.

It's interesting what people are saying about the "London problem" spreading wider. Most of my friends live up north, in naice bits of Lancashire, Cheshire and North Yorkshire. Frankly, a decent professional salary up here, let alone two, and you live really, really well. I think there is definitely a slight sense of, "Leave those southerners to it, I'm all right Jack." Certainly few of my friends' kids are even considering going south for University, they are much more focused on Leeds and Manchester.

WanttobeSupermum there were several cases of tenants going without hot water and heating last winter for many weeks over the Christmas period many of them elderly and young children/ disabled adults/children. All because when heating repairs are sub contracted out to a company the HA can only use that one company. Which is ridiculous. The heating company in question has the contracts for 32 HAs and cant handle all the work although thats still no excuse for rudeness and incompetence. And tenants arent stupid.

We know that the reason for this is that said heating company outbid everyone else for the contract.

This is another example of the corporate greed that Doctor Two mentions.

But what of the corporate responsibility not to risk vulnerable tenants freezing to death in their homes OR having to go into hospital because of this overstretching the NHS even more.....then its tumbleweed Nobody cares And elderly and vulnerable tenants arent as trendy a PR excersise as the Ugandan trip.

And tenants have NO SAY about it at all We are forced to have incompetent workmen in our homes....because its cheaper.

www.mumsnet.com/Talk/am_i_being_unreasonable/2390351-To-think-the-housing-officer-was-unprofessional

Totally agree with Doctor Two. This is not capitalism at all. If it were the banks would have been allowed to fail and we would be selling houses for cash which would result in a nice 3 bed detached house going for about £50k.

Oh and dove I can't tell you how furious the whole exchange made me. I travel for work and had gone to Mexico for two weeks. She was shocked I went for work and actually worked!

Its absolutely ridiculous Supermum.

Jassy see page 9 of this

Thanks Carol. I guessed right - that table is talking about all adults, not all earners in the numbers you've quoted. With 29 million IT payers and 3 million (lower at the time of these figures I think?) earners below the taxable threshold, there's an extra 10 million non-earners (25% of the total) chunked in to end up with the £155k mean. So, no, not a true reflection of what the top 1% of earners actually declare as earnings, let alone what they actually earn.

And the earnings quoted are declared taxable income, so the point about hidden earnings for high earners still applies.

Thanks for the enjoyable diversion, though.

I'd like to see any evidence of a speech or policy document in which Ed Miliband conflated millionaires with higher rate tax payers. What he did have was enormous problems in conveying that differentiation through an enormously biased media, who found it convenient to confuse attacks on inequality with attacks on middle income families.

soloman in the second leader debate, Milliband said that the Conservatives lowering the top rate of tax had given millionaires £40k a year. He meant people earning over £1m a year - a deliberate 'mistake'.

Jassy not sure why you think non-earners are in the 1% pool?

Because the table distinguishes between 'all taxpayers' and 'adults', and the notes below the table make it clear they are including adults who do not pay tax, including non-earners.

Maths is also a helper. There are 46 million adults in the country according to the table. You add the 1% - 0.1% and 0.1% and you get roughly 460,000.

1% of 46 million is 460,000.

How is that relevant to confusing higher rate tax payers with millionaires? And how do you know it was a deliberate mistake?

You gotta lurv Jonathon Swift!

I have been assured by a very knowing American of my acquaintance in London, that a young healthy child well nursed, is, at a year old, a most delicious nourishing and wholesome food, whether stewed, roasted, baked, or boiled; and I make no doubt that it will equally serve in a fricasie, or a ragoust.

Isn't it more to do with salaries not rising at the same rate as cost of living?

Wage stagnation is also the fault of our politicians. Wage growth was fueled by a strong manufacturing sector but with its decline the service sector has taken over. It's sad that in the service sector wages are like the agricultural sector. The margins are so slim that wages have to be kept down to allow the owners to make enough profit to reward their risk.

You look at China and their growth has been fueled by manufacturing. To add real value the best way is to manufacture goods. What the UK doesn't understand is that our service sector has been built on our manufacturing base. As that declines so will the service sector eventually in many areas.

Every vacancy that exists is for a job that needs to be done. Every single job that exists needs to be done, else there would be no job, no vacancy. So, every job could be paid the same.

That would equalise everything.

I basically agree Jux - in that I think any job that needs doing should be paid a salary that allows a reasonable standard of living without subsidy.

As an addenum to that, a genuine meritocracy is totally reasonable. If you can do something better than anyone else - that has a genuine benefit for society as a whole, enjoy the spoils.

What I don't like is the abuse of debt and capital in society - where people are allowed to take insane liberties with borrowed money created out of thin air to attempt to leverage their position to the detriment of society as a whole. And then get bailed out when their stupidity and risk taking - which was predictably horrendous, despite what the shills in the media say.

I include not just bankers, but any rentier - buy to letters and people taking on massive mortgages that simply do not bear any relation to their ability to pa are just as culpable by participating in this nonsense. An awful lot of people should have gone bankrupt in 2008, but didn't and are now doubling down.

Meanwhile anyone who attempts to live sustainably is often accused of 'the politics of envy'. It's horseshit.

Jassy There are non taxpayers in the table, but the top 1% of adults in the table are all taxpayers, so the average is not being reduced - the 42,000 may be the top 2% of tax payers.
Soloman Guardian link. And either deliberate or very stupid.

If you want the taxpayer figures, the ONS has them.

That doesn't alter the fact that your statement - that the top 1% of earners make an average of £155k - was incorrect for two reasons.

First, because that figure refers to all adults - so the bottom 25% have earnings of 0 which means your figure does not track for earners at all. Do you not see how including non-earners gives you a wildly different figure for what the top 1% earns?

Second, because you misquoted the table. The figure you referred to relates to the top 1-0.1%, and excludes the top 0.1% - so the very highest earners (and their declared earnings) are also excluded from the £155k you quoted.