Britain’s not as unequal as you think
WE hear a lot of wailing about how Britain is more unequal than many other European countries. It’s all down to neoliberalism of course: us bastard capitalist grinding the faces of the poor into the dust. However, the country’s really not quite as unequal as many think: and the reason isn’t neoliberalism either.
Here’s a slideshow at the Telegraph. It’s about house prices around the country. 1 square metre of housing in Westminser costs £7,500. One square metre in Newport £1,100. OK, so you could say that just shows how unequal the country is. Or you could think a little more and then ever that inequality is much less than is recorded in the official figures.
For the official figures tell us about people’s market incomes. Or there’s another set which are about incomes after taxes and benefits. But they’re still about incomes. But that’s not really what we mean by inequality: what we really mean is consumption. How much stuff can people get with their incomes? And for that we need to be measuring the prices that people pay for things, not just the amount of income they have.
When you do that, when you adjust for prices paid for things, then you find that consumption inequality is much lower than that of incomes. Yes, sure, there are people working in London who make vast gobs of money. They’re also paying vast gobs for their housing (and their beer etc). There are people in Newport earning a comparative pittance: they’re also paying a comparative pittance for their housing (and their beer etc).
Actual inequality, inequality as it is actually lived, is a lot lower than the official figures tell us. Largely because we’ve got a pretty standard mid-level European economy and prices for most of the country. And we’ve got the world class international city of London, with those world class prices and wages, inside it. An awful lot of measured British inequality is not between people in the same area: it’s between London and the rest. And that just isn’t what we all really mean by inequality.
Posted: 16th, October 2012 | In: Money Comment (1) | TrackBack | Permalink
