How bad is bad? Britain’s descent into mind-boggling inequality

Mike Phipps reviews Shattered Nation: Inequality and the Geography of a Failing State, by Danny Dorling, published by Verso, available here.

Introduction

Danny Dorling begins this thoughtful but polemical book with some memories of growing up in Oxford. “In the 1970s,” he observes, “which neighbourhood a child lived in mattered far less for their life chances, and which local school you went to was less important than it is today. House prices varied far less between areas, and children who grew up in private housing and council housing more often played together.”

There are now 200 places available on Airbnb on the council estate he grew up in. The neighbourhood that once had the cheapest private housing is now too expensive for most university academics to afford and is increasingly inhabited by London commuters.

The whole city is “a far more unaffordable, tense, anxious and restless place than it was in my childhood. There are far more students now, many of them coming from overseas… Those who are not from the United States are normally shocked to see how many homeless people sleep on Oxford’s streets.”

Britian is going in a different direction to most of the world, where most things to do with human lives and livelihoods are getting better. Life expectancy is rising steadily almost everywhere, except in the UK (and the US). In 1950 Britan had the sixth best life expectancy in the world – it’s now 37th. Almost everywhere, infant mortality is falling faster than in the UK.

When did this start? According to the New Economics Foundation, measures of domestic social progress peaked shortly after 1973, when UK income inequality was at an all-time minimum, and fell relentlessly from 1977 onwards. The UK became the most unequal country in Western Europe after nine years of Labour government. After nine years of Conservative government, it became the second most unequal country in the whole of Europe, overtaking Latvia in 2019.

The greatest crisis came with the banking crash in 2008, after which the UK experienced its worst pay squeeze since the Napoleonic era. The result has been an economic and social splintering, which politicians have made speeches about but done little to tackle.

For example, in August 2022, the Department for Levelling Up produced a prospectus explaining that the policy of a UK shared prosperity fund was, “fundamentally, about levelling up people’s pride in the places they love”. Dorling notes: “The prospectus suggested that perhaps a little more money could achieve this, but what it mainly offered was good vibes… Four days after the August prospectus was released, the former chancellor, Rishi Sunak, was caught on camera explaining in detail at a hustings that what the Conservatives were actually doing was diverting money away from poorer areas and towards some of the wealthiest parts of England.”

The economic and social splintering of the UK has had an effect on the geography of its politics. Between the late 1970s and early 2010s, young people in Britain were increasingly likely to move south if they could. The population in many parts of the North became older, and usually these areas also became more conservatively inclined.

But we should be careful about what we infer from this. A higher proportion of people in the South voted to leave the European Union than in the North, where more people did not vote at all in the 2016 referendum. The story we have been told of northern working class Leave voters being decisive is markedly at odds with the data: of all those who voted Leave, 59% were middle class (A, B or C1), and 41% were working class (C2, D or E).

Hunger

Dorling takes us through the new evils of the age: hunger, precarity, waste, exploitation and fear. Our cumbersome and punitive benefits system has led to a proliferation of food banks – there are now almost twice in the UK as there are McDonald’s outlets. By the summer of 2022, 36% of UK households were facing significant financial hardship.

All this is fixable. VAT, a regressive tax and needs to be minimised, benefits and low wages increased. Supermarkets can be taxed depending on how high they price certain goods. In 2022 Greece introduced simple price controls on basic foodstuffs sold in airports, cinemas, theatres, bus stations, hospitals, clinics, archaeological sites and museums, passenger ships, trains, sports grounds, courts, nursing homes, universities and schools. The caps limit exploitation and keep down inflation.

in Britain, there is an ideological aversion to regulation of any kind. I was astonished to learn recently that a tourist was charged £450 for a seven-minute pedicab ride of 1.3 miles. I was less surprised to learn that the law regarding the operation of these vehicles has not been updated since 1869.

Low benefits look set to stay, whoever is in power. Scotland has reintroduced child benefit payments for third and subsequent children but Labour says it won’t if it wins the next general election. The post-war vision of a comprehensive benefits system has if anything been replaced by an older model – a system of minimum pay-outs and frequent penalties, aimed more at monitoring people and enforcing a social hierarchy, which is also extremely expensive to administrate. In the first quarter of 2022 there were almost 50,000 sanctions on claimants, nearly three times the number made in the last quarter before the pandemic began in early 2020.

Precarity

‘Precarity’ used to refer to insecurity in employment, but increasingly it applies to housing insecurity too. As council housing was sold off and the sector shrank, private rentals mushroomed and are once again the sector with the lowest-quality housing and the most expensive tenure. Those with capital buy up property as an investment – there is no real shortage of homes.

The housing situation could be rapidly improved by encouraging people who own more than one home to revert to owning just a single property and helping people who now live alone in large multi-bedroomed houses to downsize. The 2011 census revealed that, of the 66 million bedrooms in England and Wales that year, 22 million were unoccupied on any given night (assuming that only married couples ever shared a bedroom). Even in London, there were 92,000 more bedrooms than people to sleep in them. This does not include all the potential and former bedrooms a house may have.

Britain now has the lowest spending on public services of any large country in Europe. The result is that its privately-provided services and utilities are expensive. In 2022, Germany introduced a €9 public transport ticket and Spain introduced free rail travel. “A different world is not just possible, it already exists in Europe,” suggests Dorling.

It’s worth remembering too that the highest emitters of greenhouse gases tend to be the richest in society. Britain attracts the fabulously wealthy, partly because its approach to their tax affairs is less rigorous than elsewhere – but this concentration of wealth also distorts our politics and media. Britain’s wider poverty is largely the consequence of it having become so unequal.

Waste

The idleness embodied in mass employment that so concerned Beveridge has now been replaced by people’s time and abilities being wasted while they are at work. Huge numbers of people are now employed in sales, marketing, finance and accounting, contributing very little to overall well-being, efficiency or happiness. Sector by sector, Dorling goes through the startling decline in recent years in productive work and its value to the UK economy.

In contrast, the number of people working in real estate doubled between 1979 and 1999 and then doubled again between 1999 and 2019. Funeral directing has become more ‘productive’ – not because there are more funerals, but because more staff are spending more time persuading relatives to buy more expensive funeral packages. Work in the UK has shifted towards activities where more money is made from exploiting each other, notes Dorling. “The industry that has grown the most in terms of employment – up by 209 per cent in the past twenty years, with a threefold rise in its share of the UK economy – is head offices and management consultancy.”

Meanwhile, unlike other European countries, British workers are working longer hours. Six out of every seven companies that trialled a four-day week in Britain in October 2022 said that they were minded to adopt it as policy without loss of pay. But when local authorities conducted the experiment, the government instructed them to end it. Never mind the evidence: it clearly didn’t fit the ‘work longer to be more productive’ narrative. Nor does the mounting evidence from around the world that people who have grown up in more equitable countries are more productive in their work.

Exploitation

Education presents an even bleaker picture. Of all the countries internationally surveyed by the OECD, England’s education system encourages the flourishing of students’ imagination the least. Instead, pupils and students are increasingly being exploited as a source of income by educational establishments that operate as businesses instead of being public services. England has the highest university fees in the world, a third higher than the US and 83 times higher than Germany’s.

Add in private schools and no other state makes as much money from education as the UK. Of the 38 members of the Organisation for Economic Co-operation and Development, only Chile (and only before the uprising of 2019–22) spent more on the private education of a few children than is spent in Britain today. Additionally, nearly 80% of secondary schools have effectively been privatised, with varying teachers’ pay and conditions, through academisation and primaries are going the same way.

The results? Education for those aged over 24 has collapsed. Thousands of children are excluded from school altogether, ending up in ‘alternative provision’  from which extraordinary profits are made, with little proven benefit to the children.

Health

Since 2012 there has been a dramatic worsening of physical health in the UK, with a fall in life expectancy between 2014 and 2018. The upper estimate for the number of premature deaths in Great Britain attributed to austerity between 2012 and 2019 was 335,000, much greater than all the deaths attributed to the pandemic in 2020–22. Today the life expectancy gap within Britain has become greater than that between the UK and Sudan. Such inequalities are not going to be resolved by trying to make people feel proud of where they live.

The crisis affects all areas of health care.  In a third of areas in the UK there is no longer any provision for new adult NHS dental patients, and four out of five NHS dental practices are not even accepting children. Local councils are using public money to pay the bill for loss-making privatised care homes. High pay for managers and the internal market have increased inefficiencies across health care: “Finland spend much less money per person on their public health services, to far greater effect and with minimal waiting times.”

Hope?

Bulgaria, the poorest country in the European Union, is the only other state in Europe as unequal as Britain. Our inequality is reflected in the media and politics. Internationally, the UK has become the central European hub for proponents of the idea that incredible extremes of inequality are beneficial, even natural. The main European thinktanks promoting inequality are almost all based in London and in some  cases closely linked to the arms trade. US influence is also crucial.

Increasingly, figures from the ideological extreme right have been appointed to civil service posts or as government advisors, as when Prime Minister Liz Truss appointed Matthew Sinclair, former head of the TaxPayers’ Alliance, as her chief economic advisor.

Britain is a shattered nation, concludes Dorling, and only sticking plasters are being proposed to fix it. There was a lot more optimism around in the post-war era, he suggests, whereas today we struggle to be hopeful. I would like to have read more about this, because I’m aware that he knows that there was a surge in optimism in Britian that coincided with the election of Jeremy Corbyn as Leader of the Opposition, which fell off a cliff at the end of 2019.

How do we restore hope? In contrast to that time, there are far fewer politicians today proposing the very obvious solutions to the problems Dorling itemises: progressive taxation, rent regulation, socially useful work, an end to privatisation and a new emphasis on health and education as public goods rather than commodities. Obvious stuff, which we have to fight to force back onto the mainstream political agenda – but in the knowledge that public opinion remains with us on the central remedies we propose.

Mike Phipps’ book Don’t Stop Thinking About Tomorrow: The Labour Party after Jeremy Corbyn (OR Books, 2022) can be ordered here.