Earlier this year, Oxfam research found that the five richest families in the UK are wealthier than the poorest 20 per cent of the population combined. That means that just a handful of families hold more wealth than 12.5 million people.
More working households are living in poverty in the UK than non-working ones with some 13 million people currently classed as living below the poverty line (those falling below 60 per cent of national median income). Since 2003, the majority of British people have seen a 12 percent real terms drop in their disposable income, while the richest 5 percent keep getting richer, with their disposable income increasing by more than £461 a week.
Many must make the difficult choice between heating their home and going hungry in order to feed their children. This glaring inequality is making a mockery of the hopes and ambitions of millions of people across the country, and is eroding their ability to influence decision-making.
While these facts show just how much economic inequality has spiralled out of control, the issue is too often framed as a polarising political issue rather as than something that all parties must tackle together. Arguments that dismiss calls for equality as naively idealistic, or as part of an anti-business/anti-growth agenda are not only limited, but they demonstrate that little will change until we change the dialogue around inequality and realise how much it affects us all.
As well as changing the narrative, it is imperative that we confront power imbalances and fight for progressive policies. It is around these goals that Oxfam launched our major global report and campaign to even the gap between ‘the rich and the rest’, and why we were so pleased to have had the opportunity to speak at the Fabian Society event ‘Fighting Inequality: Poverty, the middle and the one per cent’ at this year’s Labour party conference.
The influence and interests of economic and political elites have long reinforced inequality across the world – money buys political clout; access to justice is often for sale; and elites use their heightened political influence to curry government favours while blocking policies that would benefit the majority.
This theme has intertwined itself throughout Oxfam’s research papers, including Our Economy: Towards a New Prosperity and A Tale of Two Britains, with many interviewees reporting they felt those with the most money are able to rig the rules and influence government policy in their favour – often at the expense of everyone else. If we want to tackle inequality we must also tackle power imbalances – everyone must be able to influence the decisions that affect their lives. This is why Oxfam works to increase access for people whose voices are too often unheard in the corridors of power.
While some inequality is inevitable, the extreme levels of inequality that we are now seeing across the world are harmful socially, economically and politically. Even organisations such as the International Monetary Fund have found that extreme income inequality undermines both the pace and sustainability of economic growth, and finds that redistribution efforts – including progressive taxation and spending on health and education – are pro-growth.
We stand at a point where real, concentrated action from all political parties could still reverse the trend of rapidly rising inequality. Governments can start by opposing the special interests of powerful elites, moving away from the economic doctrines that have allowed the inequality explosion of the past 30 years, and levelling the playing field by implementing progressive policies on areas such as taxation, wages and public services. In the UK, a good place to start would be to crack down on tax dodging by UK companies, here and in developing countries, thus bringing in money that can be spent on essential public services and poverty reduction programmes. On the global stage, the UK government should also support a goal to end extreme economic inequality in every country.
Ending extreme inequality
Today’s extremes of inequality are bad for everyone. For the poorest people in society, the opportunity to emerge from poverty and live a dignified life is fundamentally blocked by extreme inequality. Governments have a responsibility to tackle extreme inequality and they must help to change the narrative, address the factors that have led to today’s inequality explosion, and implement policies that benefit the majority, and not just a powerful and wealthy minority. It is time for us to demand a more equal world before we are tipped irrevocably into a world that caters to the privileged and forces millions of people into poverty.