Why does everyone say inequality is falling, when it's rising? Because they're only counting incomes, not all wealth (property, pensions, etc.)

Inequality has reduced!

No it hasn’t.

Yes it has! I heard Dimbleby say it on Question Time. And the Lefties all nodded solemnly.

“...the statistics show the gap is narrowing” David Dimbleby 2nd February 2017

That’s because they‘re all clueless.

Never!

They don’t realise they’re only talking about income inequality, not wealth inequality.

What’s that?

Wealth inequality measures all your assets – property, shares, pension pot, that sort of thing.

You mean the really big numbers.

Right. Income is just what’s going into your bank account – pay, dividends, pension payouts, and the rest. Net Income – what they’re referring to when they talk about income inequality - is all that after benefits and taxes have been added and subtracted.

Let me guess. Wealth inequality has risen?

You win a free Question Time T-shirt and nodding duck pencil sharpener. Generally, asset prices have continued to recover since the bank crash, but the poor hardly have any assets!

So the gap between rich and poor continues to rise.

Yup.

And what of the gap between Dimbleby’s ears, and the ears of every card carrying leftie who hasn’t bothered to use this shocking fact that would make every working hour of their lives so much easier?

Hmm. No official data on that one. Looks like the Office for National Statistics needs to tear itself a whole new index.

The background data

Wealth inequality is almost twice that of income inequality. The overall Gini coefficient (the official measure of inequality, where 0=minimum and 1=maximum) for net income is 0.34, while that for total wealth is 0.64.

Institute for Fiscal Studies: "Household Wealth in Great Britain: Distribution, Compositionand Changes 2006–12" 

HRP = age of household reference person

Wealth in Great Britain is even more unequally divided than income. The richest 10% of households hold 45% of all wealth. The poorest 50%, by contrast, own just 8.7%.

 

Equality Trust: The Scale of Economic Inequality in the UK

Office for National Statistics: Total wealth, Wealth in Great Britain, 2012 to 2014 (Chapter 2)

Wealth inequality is rising. The ONS report says: “In July 2012 to June 2014, the wealthiest 20% of households had 117 times more aggregate total wealth than the least wealthy 20% of households. In comparison, the wealthiest 20% of households had 97 times more aggregate total wealth than the least wealthy 20% of households in July 2010 to June 2012.”

It goes on the explain: “Figure 2.10 shows the median household total wealth by the levels of household net equivalised income. Households in the lowest band of income had the lowest median household total wealth, while those households in the highest income band had the highest. During July 2012 to June 2014, households in the lowest income band had a median household total wealth of £34,000 while for the highest income group that was over 26 times as big, £225,100. Between the 2 survey periods shown, the median value for those in the lowest 3 income bands fell, whilst the median value of household total wealth increased across all other income bands. The median value of household total wealth fell the most in the lowest income decile, with a 38% fall seen between July 2010 to June 2012 and July 2012 to June 2014, and the largest increase was seen in the top 2 income deciles, with a 19% increase in the median value seen over the same period.”

Office for National Statistics: Total wealth, Wealth in Great Britain, 2012 to 2014 (Chapter 2)

The South East’s median household total wealth (£342,400) is over twice that of the North East (£150,000). It's another sign of the growing divide between the south and the rest.

Office for National Statistics: Total wealth, Wealth in Great Britain, 2012 to 2014 (Chapter 2)

The poorer regions have got poorer. Yorkshire and The Humber saw a fall in median household total wealth of 8% between July 2010 to June 2012 and July 2012 to June 2014. Smaller falls were also seen in the West Midlands (2%) and East Midlands (1%).

Office for National Statistics: Total wealth, Wealth in Great Britain, 2012 to 2014 (Chapter 2)

Even income inequality is on an upward trend, when you include housing costs: essential costs like rent or mortgage interest, water charges, insurance premiums, and service charges. This is important as such costs can hardly be avoided. The Resolution Foundation report says “Looking at the 90/10 ratio, income inequality before housing costs peaked in 1991 and has been largely flat or falling since then. But after housing costs, this ratio was higher in 2014-15 than at any point in the 1980s or 1990s.”

Resolution Foundation: Living Standards 2017

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Bank of England director explains why broke Britain is broken. Is anybody listening?

In his first tweet after being sacked as Chancellor of the Exchequer, George Osborne chirped "Others will judge - I hope I've left the economy in a better state than I found it".

It so happens two weeks earlier the excellent Andy Haldane, executive director at the Bank of England, made his judgement. The date is important, as Osborne was still sitting confidently on his stool in the Treasury, so Haldane wasn't simply knifing a political corpse. Haldane was speaking truth to power, as so many others who should be doing so had long since ceased.

Haldane's speech in June 2016, titled "Whose Recovery?", should be essential reading in particular for the revolting Labour MPs. The speech offers them an insight into why the ordinary Labour Party membership backed Jeremy Corbyn. And why the Labour Party actually is a party of protest, both in Government and in Opposition. 

 

The Golden Rule states "Whoever has the Gold makes the Rules". Whether in Government or in Opposition, the Labour Party should represent those without the Gold, and should act as a counterbalance to those who make the Rules even when it is in Government. Because when the Labour Party was not a party of protest, it became the de facto Tory Party (a.k.a. "New Labour"). In truth, had Tory leaders during the Blair years been brighter they could have more quickly undermined Blair by supporting, not opposing, his policies.

Britain needs strong parties of all complexions, from left to right. Regime change in the Tory Party is done with ruthless corporate efficiency, while in the Labour Party it is done with all the blood and broken noses of a pub brawl. Both methods are fine, so long as both emerge representing their members.

Haldane, a product of state school and redbrick university, whether he is in an oak panelled room or in a whitewashed community centre listens to what he hears and  he sees what he looks at. Listening and seeing are talents sadly missing in the revolting Labour MPs. 

In his speech Haldane says:
"I began by speaking about the UK’s economic recovery.  I never got as far as the improvement in the jobs market or surging confidence.  I was stopped in my tracks by a forest of furrowed brows and a phalanx of probing questions, not all of them gentle.  “What exactly do you mean by recovery?” one asked.  “My charity is dealing with 50% more homeless people than three years ago.”   Every other charity in the room had similar stories to tell.  Whether it was food banks, mental health problems or drug addiction, all of the numbers were up.  The language of “recovery” simply did not fit their facts."

We leave it to Haldane to explain whether Osborne left the economy better than he found it, and why ordinary Labour Party members support Jeremy Corbyn:

1) Haldane points out that the UK economy as a whole can improve by making the rich slightly richer and the poor much poorer:

2) Regional income inequality has widened.
Haldane says:
"Another notable pattern in regional income gains and losses is that the largest gains have come in regions where income was already high – London (incomes more than 30% above the UK average) and the
South-East (14% higher). Contrarily, some of the larger losses have been in regions where income was already-low – Northern Ireland (18% lower than the UK average) and Yorkshire and Humberside (14% lower). Put differently, since the crisis the regional distribution of incomes has widened."

3) In recent years the rich have been given more and the poor have been made poorer. Haldane says: 
"in a subjective well-being sense, there may have been no recovery in the UK over the past few years". 

He states:
"aggregate GDP figures may over-state somewhat the impact of the recovery on societal well-being: gains by the already-rich boost well-being by less than equivalent losses by the already-poor. To demonstrate that, Chart 12 plots an illustrative measure of “social welfare”. "

3) The recovery from the 2008 recession has been the slowest in decades:

4) By 2015 GDP per person was only 1% above pre-crash levels.

5) The GDP figure includes all UK income, including that which is sent overseas. Office for National Statistics figures show over half of UK quoted shares are owned by the 'rest of the World'. Illustrating how boosting company profits by holding down wages isn't good for Britons.

% of UK stock market owned by "rest of the World"

Haldane states that in terms of GDP per head that is actually kept in the UK there has been no recovery:

6) The "jobs recovery" has not been a "wages recovery". Noting that more people are in poorer paying jobs, Haldane states: 
"Although the recovery of the past few years has been jobs-rich, it has been notably pay-poor."
Haldane goes on to say:
"This is the longest period of flat or falling wages since at least the middle of the 19th Century". 

7) Bank of England and Office for National Statistics figures for 2015 show that in fact only London and the South East have passed their pre-crash peak. Haldane says:
"For example, in Northern Ireland GDP per head remains 11% below its peak, in Yorkshire and Humberside 6% below and here in Wales 2% below."

8) When it comes to Wealth, Haldane says:

"If we turn from income to wealth, the picture is much the same...This has risen across all regions. But the pattern is again uneven, with the largest gains in London (47%) and the South-East (25%), whereas in Wales the gains are smaller (8%) and in the North East there has been a small fall in wealth. 

"..these gains have come principally from rises in property and pension wealth. In other words, the gains have been skewed towards those in society who own their own home or who have sizable pension pots."

Andy Haldane says in this speech:
"The rising economic tide has not lifted all boats. Indeed, a sizable fraction of households have seen no recovery in their disposable incomes, a rise in job insecurity and at best modest rises in their wealth. For them, the “recovery puzzle” may not be so puzzling. These data also suggest that distributional factors may be important when understanding “whose recovery”. "
 
"This has been an uneven economic recovery, looking across regions, income and age cohorts. Large parts of the UK – many regions, those on lower incomes, the young, renters - have not experienced any meaningful recovery in their incomes or in their wealth."

The revolting Labour MPs desperately hope to cling to their well compensated jobs. The poor things have invested years sucking up to one set of leaders, only to find them chucked out and replaced by Jeremy Corbyn of all people! Probably Corbyn has so little support among the MPs because nobody had bothered licking their spittle onto him.

Labour MPs need to emulate Andy Haldane. Instead of cloaking themselves in self-importance, convinced that only they can "save the Party", they need to go out and see what they look at, and listen to what they hear.  


Labour MPs must stop peeping out of the windows of their Westminster Chambers, demonising their own party members. 

Instead of plotting engrossed in their Westminster mutual admiration society, they need to understand the reasons why Labour Party Members around Britain overwhelmingly supported Jeremy Corbyn.

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The Labour Party can survive rebellious MPs. But without its ordinary party members the Labour Party is toast.

Superman?

Labour MPs slipping into their underwear to “rescue” the Labour Party by defenestrating Jeremy Corbyn should beware. They should take heed of the precipitous scene in the 1978 Superman movie, as well as the precipitous destruction of the Liberal Democrat Party in 2015.

As in the Superman (1978) Movie: Labour Party falls from a skyscraper to be caught by SuperLabourMP,

SuperLabourMP: “I’ve got you”
Labour Party: “You’ve got me? Whose got you??”
 


Labour MPs' plotting to subvert the will of ordinary party members who chose Corbyn forget that without the support of those ordinary party members the MPs don't amount to a hill of beans. Labour MPs forget they owe their jobs to their party and its members, and not to their own talents. A survey by the Hansard Society in 2013 found more than three quarters of people didn't even know the name of their own MP. Over a single decade the number who knew even their MP's name dropped from 42% to 22%, such is the irrelevance of the individual MP.

Am I being unfair? Could it be our MPs, like Spiderman and Catwoman, deliberately seek anonymity? So they can go unmolested into their local nailbar for a soothing scrub?

 
Or is it just that most people simply don't care who their MPs individually are? They just vote for the Party because the Party has their support regardless of the person who takes the seat. And when the Party loses their support it will hit the ground with an almighty CRASH! Rather like the Liberal Democrats did in 2015.

Liberal Democrat supporters brutally punished the LibDem parliamentary party for what they regarded as treachery supporting Tory policies during the 2010-15 coalition government.  

Labour Party supporters too will punish their Party for the MPs' treachery. Specifically the party supporters motivated enough to fill envelopes and schlep around canvassing during elections will be motivated enough to stop. 


Angela Eagle MP seemed to have worked this out. Having been persuaded by more timorous colleagues to be the Forlorn Hope standing against Corbyn, within days she postponed her declaration. Perhaps persuaded by rumblings of discontent from her own constituency party, expressed not least in a "Hello Angela" letter to her:

“Hello Angela

At the CLP [Constituency Labour Party] AGM on Friday 24th June 2016, delegates asked me to write to you to ask you to reject the motion of no confidence in Jeremy Corbyn. The meeting was overwhelmingly behind Jeremy continuing as Labour leader. Your appearance on TV during the post referendum programme was mentioned. Your response in putting the question of his leadership aside to deal with the issues was welcomed. The idea that the Labour Party would rather miss the chance to capitalise on the splits in the Tory party by in fighting was not acceptable to members.
On behalf of the constituency I would ask you to make a clear public statement of support for him.

Regards

Kathy Miller & Kathy Runswick
Secretary & Chair Wallasey CLP”

Labour MPs believe the Labour Party's primary purpose is to keep them in a job. They are mistaken. The Labour Parliamentary Party's primary purpose is actually not even to be in Government. The Labour Party's primary purpose is to represent its supporters, whether from the Government or from the Opposition. Ideally by being in government. The same goes for the Conservative and any other party.

Having a Labour Party in Government that does not represent its supporters is the worst of both worlds. With an un-Labour Government and a Tory Opposition, Labour Party supporters are effectively cast adrift.

In fact both Labour and Tory parties have been casting off their supporters over the last 30 years. The British Social Attitudes Survey of 2013 showed both Tories and Labour losing swathes of their traditional supporters. As both parliamentary parties moved to the Right, supporters seemed to have been pushed from Tory and from Labour to None:
 
 
 

The disconnection with traditional supporters is reflected in the takeover of political parties in Parliament by career politicians as shown in a report in 2013 by Parliament's "House of Commons Library". Parties taken over by career politicians who use their parties to support their careers.

A political party's primary purpose is not to keep a few hundred anonymous individuals in comfortable Westminster jobs. 

It is to select people who will represent each party's supporters.

If Labour MPs don't understand this, then they should be replaced. Just as if Tory MPs didn't represent the comfortably off, not just the exceedingly flush, they too should be replaced.
 
Treachery always has unintended consequences. Gove didn't shank Johnson in pursuit of female emancipation. And yet the consequence of his act will likely be the second female Prime Minister of the United Kingdom.

The Labour MPs' coup wasn't intended to strengthen Jeremy Corbyn, and yet it left him immeasurably stronger. Their rebellion made Corbyn the KingMaker, who can hand the Labour crown that he never wanted to whomever he chooses. The next Labour Leader should be beating a path to Mr.Corbyn's office bearing his CV. The job is in Corbyn's gift.

Perhaps this is Corbyn's destiny:
Step1: Block a new New Labour leader in 2015.
Step2: Anoint a new Labour leader in 2016.
Thereby Corbyn rescues the Labour Party:

Corbyn: “I’ve got you”
Labour Party: “You’ve got me? Whose got you??”
Corbyn: "The party membership! ;)"

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Labour MPs ousting Corbyn: the rebellion of the cheesemakers!

Labour Party rebels blaming Jeremy Corbyn for BREXIT bring to mind an emotionally inept spouse trying to work out why his angry partner threw a teapot at him. 

The ninny obsesses about what his spouse had against the smashed teapot. Was it the colour? Did the nozzle drip? Would a new teapot make everything better? He is far too self-obsessed to see the problem is himself.

Labour MPs rebelling against Jeremy Corbyn are so distant and self-obsessed they can’t hear what the people they claim to represent are saying. 

"Blessed are the cheesemakers!" the bovine MPs hear, taking this as clear confirmation they should rebel. "The Greek will inherit the Earth" sends them scurrying looking for whoever is bearing the nicest gifts.

So inept are the Labour rebel leaders that they staged a drip-drip of shadow ministerial resignations over several days. Confirming to ordinary Labour Party members the whole rebellion was rehearsed like a school production of a Gilbert & Sullivan comic opera: long on planning, short on talent.

We Resign, TaranTara!

Or perhaps it was simply the later the resigner left their announcement indicated the measure of their cowardice in waiting for safety in numbers? 

In fact both the main political parties, like many other reptilian species, periodically slough off their skins. The Tories with Thatcher in 1975, and Labour with Blair in 1994. What is unusual is in 2016 the Tories and Labour do it together. Writhing like two mating rat snakes. No romance, no empathy, just the need to spawn and survive.

BREXIT was a protest against a politics that cut the many adrift, leaving the few to prosper. Corbyn and his supporters seem to be the only mainstream leaders who understand this.

Perhaps Corbyn’s role is to block the Labour Leader’s seat to keep it from the Blairistas. Like the ancient Roman Horatio, Corbyn is holding the bridge to the leadership until an ambitious and suitably talented politician emerges from the Left.

Britain needs strong parties of all complexions, from Left to Right. Whoever that ambitious and capable Leftie is, its about time you stepped forward. 

Until then, Corbyn should continue his Rope-A-Dope strategy, and let the rebels come out punching until they get bored with themselves.

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BREXIT was about Inequality in Britain, not Immigration. Have our politicians realised this?

Those still puzzling why Britons voted to leave the European Union (EU) in June 2016 should look to what's wrong in Britain and not to Europe. 

Naturally there will be many different individual reasons, but the dog whistles blown by both BREXIT (xenophobia) and BREMAIN (punishment) were not the decisive cause of the result.

Britons voted to protest that even if the European Project made Britain richer, if the riches the went to the few and they didn't get a share, then they didn't want to stay anymore. A protest that "the few" were surprisingly oblivious to.

Britons voted for BREXIT because of chronic Inequality and Inequity in Britain, not because of immigration. Data from the Electoral Commission shows that out of 382 regions, 263 had a majority for BREXIT. London, which has by far the highest proportion of immigrants, voted strongly for BREMAIN. 

For evidence, look to the data:

a) Office for National Statistics migration data shows the areas that voted for BREXIT in England have lower levels of immigration than those that voted for BREMAIN. London, which came out strongly to BREMAIN has the greatest percentage of non-British population:

b) On the other hand, the areas that voted from BREXIT are, apart from Northern Ireland, significantly poorer than those that voted for BREMAIN

c) Other ONS data shows the extraordinary degree London has taken the lion's share of the UK's economic success.

d) A report by Inequality Briefing showed for Northern Europe London is the richest region, but 9 out of the 10 poorest regions were also in the UK.


Jeremy Corbyn has to be admired for his insouciant "rope a dope" strategy to deal with Labour MPs calling for his resignation. MPs whose slithering up the greasy pole has resulted in it slipping their minds who they are supposed to be representing.


Inspite of all his opponents' trash talking Corbyn should be confident the crowds of ordinary party members are behind him. 
Perhaps Corbyn doesn't really want to be, or is not suited to be, Prime Minister. But for Labour to avoid returning to "Tory-Lite" mode, he needs to hold fast. Eventually it will dawn on an ambitious and capable Labour politician the path to Number 10 is to the left.

Corbynistas should take heart:
a) 24 hours after two Labour MPs tabled a vote of no confidence, a petition on 38 Degrees had more than 140,000 members of the public voting their Confidence in the man:

b) The EU referendum turnout was higher than any General Election since 1992. This was because a clear alternative was offered: In or Out. Something that hasn't happened since 1997 from when the electorate has been offered Tory-Lite (New Labour) or Tory-Tory (Tories).

Corbyn needs to offer a clear alternative, then the usual non-voters will come. 

Farage, Gove and Johnson may actually believe their "Once more unto the BREXIT" rhetoric caused Britons to head for the Exit. The real impetus came from decades of chronic inequality regardless of Labour or Tory governments:



Farage, Gove and Johnson may believe themselves cast in the Churchillian mould. But going in the same direction doesn't mean being led. The idea the economically disadvantaged were led by rightwing Tory luminaries Gove and Johnson is risible. BREXITEERs were punishing the political class, especially rightwing Tory luminaries.

Just because Britain voted to BREXIT didn't mean they believed what the BREXIT camp told them. Remember, a chap being followed closely by a bull is more likely to be being chased by it than to be leading it.

 

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