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Less (inequality) is more….

Written By: - Date published: 7:19 pm, January 25th, 2014 - 40 comments
Categories: capitalism, child welfare, class, crime, david cunliffe, democratic participation, education, election 2014, equality, health, john key, Metiria Turei, poverty, sustainability, workers' rights - Tags: ,

.….. more equality is  better for everyone.

 

With John Key misleadingly trying to deny the significance of the inequality gap,

and David Farrar falsely claiming that poverty doesn’t have a profound impact on education,

it looks like this is likely to be an important election issue.  Time to revisit the Spirit Level.    Back in 2010, Standard author Bunji posted a series of 6 “Digested reads” on the book, The Spirit Level: why equality is better for everyone, by Richard Wilkinson and Kate Pickett (2009).

1: The Problem:

Poverty profoundly damages lives. Adding to that high levels of inequality bring stresses that are bad for all of us.  In a hierarchical and overly competitive society we all suffer. Poverty results in poor health and this impacts on all areas of life. On top of that the stresses of inequality can be overwhelming. Bunji wrote:

The Spirit Level authors believe income inequality is largely important as it is our current way of measuring hierarchy in society.  Other forms of inequality are probably important too, but income is where the data and evidence is, and it is the way society currently values people.  A certain level of wealth is required

But, for everyone, even with a reasonable income, the stress of competition and “keeping up with the Joneses” takes its toll.

Having less than those next to us makes us anxious and stressed.  It affects our self-esteem.  We become self-promoting and insecure, as we are constantly in a race and scared of being found out as not as important (ie wealthy) as we make out to be.  We have less time to make and keep friends as we spend all our time trying to earn and spend our wealth to maintain our place.

In a more equal society the race isn’t so all-consuming, we have more friends, more trust, more community and more happiness.  But no less wealth.  He who has most toys doesn’t win, he just makes sure others lose out more.

Bunji followed this post with others elaborating on this main point:

2.  Inequality is bad for everyone’s health.

3.  Equality breeds trust; inequality breeds crime. (Or: Do you want to be a bonobo or a chimp?).

4. Equality: better education and social mobility. Inequality: more teen pregnancies.

5. Equality works better for a sustainable future.

Bunji explained it thus:

Equality does not equal sustainability, but it is much more suited to the task than our current system.  Without the constant need to consume more and more as we compete for status, we use up far less of the earth’s resources.

There is a strong link between inequality and consumerism.  Everything from advertising (NZ & USA spend twice as much on advertising as a percentage of GDP compared to Norway & Denmark) to working hours (there is a strong trend between average hours worked to how disparate middle and upper incomes are) reflects this.

[…]

But that is not sustainable.  Even if we develop better technologies, giving us, for example, more fuel efficient cars – we’d save money, and then spend it on more goods that consume more of the planet…

6. What we can do to embrace equality – through society and government.

Bunji concludes:

It won’t take a revolution to achieve greater equality… but it will take a transformation, with a sustained sense of direction and a strong view as to how to achieve the required changes.  […]

The fact that results of so many studies show better results for the rich as well as the poor in more equal societies definitely helps that goal.  Societies do better with a more income-equal framework, but also individuals do too.  The gifted get more chance to shine, not less, in a more equal society.  Equality does not mean we all become the same.

Bunji then goes on the discuss the above in detail, and provides some examples of ways to bring about a more sustainable and livable society.  Some of the ideas amount to more democratic processes, with more cooperative activities and more employee stakes in business enterprises.

It will be interesting to see the extent to which inequalities are addressed in the 2 State of the Nation addresses in the next couple of days:

Turei children

Metiria Turei at Picnic for the Planet: January 26, 2014 – 11:00am – 3:00pm – Waitangi Park, Wellington

Cunliffe Labour save our future

David Cunliffe – A Nation of Opportunity: Monday, 27 January 2014 from 1:00 PM to 2:00 PM – Kelston Girls’ College Auditorium, Corner Great North Road and Archibald Road, Kelston, West Auckland.

40 comments on “Less (inequality) is more…. ”

  1. Tiger Mountain 1

    Re-read “The Spirit Level” recently, still a most persuasive work. In a New Zealand context until there is justice in all respects for colonised Māori descendants the negative experiences of that group drags everyone down. Not that racists will admit that.

    More patents are issued in more equal countries so thinking is likely improved not dumbed down. Equal does not mean the same indeed.

    Made me laugh in light of the “Left is dead” discussion in recent days that Cuba was the only country at time of TSL’s publication that met all the criteria for a sustainable economy combined with acceptable living standards using the UN Human Development Index and Ecological Footprint per Capita.

    • karol 1.1

      ntil there is justice in all respects for colonised Māori descendants the negative experiences of that group drags everyone down. Not that racists will admit that.

      Yes, and I noticed that the impacts of “other” inequalities, as explained by Bunji, are also likely to be damaging: eg those of ‘race’, gender, sexuality, disability, etc.

      But income inequalities are easier to measure.

      I did edit down one point of Bunji’s that I wasn’t keen on. He said in post #1:

      A certain level of wealth is required but in the wealthiest 50 nations virtually everyone has access to that.

      I do think there are a significant number of people in NZ, on the lowest incomes, who do not have that “certain level of wealth”. People who cannot afford sufficient, nutritious​ food and/or healthy and safe accomodation.

      They are obviously a relative minority, and their plight is not a great vote winner these days. But I do think we need to acknowledge their existence and their urgent needs.

      I didn’t want to take up space in the post debating that, but, I think many TS posts have/do argue for their needs.

      • Olwyn 1.1.1

        In response to both the quote of Bunji’s that you disagreed with and your answer to it, I think that poverty in a developed country takes its own special form. To begin with, the assumption that almost everyone has access to “a certain level of wealth” results in an expensive way of life – even at the most basic level. When you lack the income to meet its demands, your hardship is less visible than the third world variety, but is still very real hardship.

        • Indeed. A lot of the worst effects of poverty in New Zealand are caused by people trying to live like they’re not in poverty in terms of their luxuries, but shooting themselves in the foot by not paying attention to their real priorities. I don’t blame those people, it’s easy enough to understand, and a lot of the things that get decried as pure luxury by the Right are actually just lower-priority necessities to participate in New Zealand society as full citizens. (eg. cell phones, televisions, etc…)

          That’s not to say there aren’t a lot who just couldn’t feed their families on their incomes no matter what they do, but the number of people who have the symptoms of poverty aren’t the same as the number of people who have sufficient income to live a life without experiencing poverty.

          • Olwyn 1.1.1.1.1

            There is more to it than that. The actual necessities for life in a developed country are very expensive, and alternatives are not easily attained. Rent, power, travel costs and the dreaded water bill eat up a large portion of a small income, and food becomes the variable. It is very hard to do without the things listed in the kind of society we live in.

    • RedLogix 1.2

      In a New Zealand context until there is justice in all respects for colonised Māori descendants the negative experiences of that group drags everyone down. Not that racists will admit that.

      Umm – yes. Been good to get away from it all for a while this last year. It’s not until you hop out of the pot do you realise quite how hot it’s gotten.

      UN Human Development Index and Ecological Footprint per Capita

      Yes a rather remarkable intersection. Not too many people willing to think through all the implications of this fact.

    • karol 1.3

      What is TSL?

      • saarbo 1.3.1

        The Spirit Level

        damn TLA’s

      • Tiger Mountain 1.3.2

        The Spirit Level

        • karol 1.3.2.1

          🙂 Thanks.

          • fisiani 1.3.2.1.1

            Please keep banging away with the delusions of The Spirit Level which has been thoroughly debunked http://spiritleveldelusion.blogspot.co.nz

            • joe90 1.3.2.1.1.1

              Debunked by the tobacco industry’s galtian fuckwit, too funny.

              http://www.tobaccotactics.org/index.php/Christopher_Snowdon

              • fisiani

                Instead of attacking the author try reading. No one with a brain accepts the erroneous findings of The Spirit Level any more. That is why none in Parliament mentions it.It’s an embarrassment to the Left.

                • RedLogix

                  So exactly what is Snowden arguing?

                  1. That a world in which 85 people have more net worth than the bottom 3.5 billion people is actually not all that unequal?

                  2. Or that somehow this level of inequality is good for the world, and perhaps it would be better if the level of inequality was even higher? Maybe all the ills of the world would be solved if just one person owned everything?

                  3. Or that the level of inequality just does not matter? In which case why do you care?

                • gem

                  Our parliamentarians may not have read it, which is why they don’t, and as far as I know, never seriously raised it in Parliament or in the media.
                  The authors responded to their critics’ claims, and it seems those trying to disprove the thesis cherry-picked their own stats to suit their agenda.
                  The Spirit Level documentary is coming out later this year, which will I’m sure deal with those claims.

                  • karol

                    David Cunliffe has definitely read The Spirit Level. He mentioned it, for instance in the House in 2011.

                    As Wilkinson and Pickett in The Spirit Level pointed out, we are all in this together. When we share the gains and share the pain we are all better off than if we have a society of haves and have-nots, where a few at the top do better and better and most in the middle and the bottom do worse. It is not sufficient to rely on a relationship with a few well-placed mates—the Mark Weldons, the Rob Fyfes, the Fonterras, the Telecoms, and the MediaWorks of the world—to fill the gap, because it does not make the difference.

                    But it is more common for MPs to refer to recent NZ studies in the House. They have mentioned the increase in inequality in NZ a lot.

                    And Green MPs have referred to Rashbrooke’s book on the inequality crisis in NZ.

                    David Clendon, July 2013:

                    Some members may have seen a presentation earlier this evening on a new book, edited by Max Rashbrooke, that has been published recently called Inequality: A New Zealand Crisis . Chapter after chapter describes how across the board in society in all sorts of sectors and all sorts of ways that inequality gap is opening up in New Zealand. And now we are seeing unequal access to justice, and that is simply unacceptable in a modern, liberal democracy.

                    David Cunliffe mentioned The Spirit Level when he was doing a live commentary on Question Time, for The Daily Blog: – June 2013:

                    2:08 PM Martyn Bradbury: It’s not easy to hide the inequality that is tearing the egalitarian dream to bits, but Joyce does a pretty good job of it

                    2:09 PM David Cunliffe: JOyce puts down economists Hichkey and Oram… Parker questions whether OECD believes income inequality high in NZ… and getting worse …Joyce pressured, says it is about growing jobs …

                    2:09 PM David Cunliffe: Methinks Mr Joyce should read The Spirit Level

                • karol

                  I reckon Bryan Bruce, doco maker has a pretty good brain. He mentioned The Spirit Level in relation to his doco, “Mind the Gap”, which aired on TV3 last year. TV3 Reports:

                  In Bryan Bruce’s Mind the Gap, which screens on TV3 tonight, a number of the world’s leading economists say the trickle-down theory – which argues that to increase the lot of the poor, the rich have to get richer – is a fallacy.

                  “Every top economist I spoke to [said trickle-down economics] doesn’t work,” Mr Bruce said on Firstline this morning. “Ordinary people know it hasn’t worked.”
                  One of those economists, Prof Robert Wade of the London School of Economics, tells Mr Bruce there has instead been a “trickle-up” of wealth, from the poor to the rich.[…]

                  “You have less violence, less drug addiction, all those things. Prof Richard Wilkinson is one of the people I speak to – he wrote a book called The Spirit Level, and it shows all of these correlations between having a more equal society and a better life for all of us. It’s much better if we share.”

                  2 profs with better brains than many MPs.

                  • gem

                    Yes, Bruce’s doco was excellent. I watched it with two other people, and for one of them it was quite a revelation. This surprised me at the time, but we forget that many people aren’t exposed to these ideas. What I haven’t heard Labour/Cunliffe do is clearly explain the Spirit Level premise, i.e, that when we are equal we ALL do better in a whole raft of ways. Yes, Labour bemoans inequality, frequently; but it’s not just about lifting those at the bottom up to ”our” level, it’s the fact that the most equal societies are more successful all round.
                    If they are telling it, and I stand to be corrected if I’ve missed it, they aren’t doing a great job. Just bemoaning the state of affairs isn’t enough.
                    Appeal to Kiwi pragmatism that it actually makes sense, because it does.

            • Plan B 1.3.2.1.1.2

              I do not think you are correct in any way in making this remark. I read comments on the blog you mention and… nothing has changed, the book and the ideas behind it have not been debunked. Why would you say they have?

              http://www.equalitytrust.org.uk/resources/authors-respond-questions-about-spirit-levels-analysis

    • Draco T Bastard 1.4

      More patents are issued in more equal countries so thinking is likely improved not dumbed down.

      That may have something to do with it but, IMO, a lot has to do with the fact that the people having ideas a) don’t come forward with them because they know they’ll get ripped off and/or b) don’t have enough resources to develop their ideas themselves.

      As an example of a) the person who developed industrial diamonds did so in his spare time but he used [large companies] facilities to do it. Once he was completed the company took all the credit and the profit and gave him a $10 gift voucher.

      Another example was a contract I had where the IP clause in it stated that any ideas I had to do with the industry belonged to the company. There was no mention of extra compensation.

      There’s probably more problems of that sort of ripoff going around as well. It’s what happens when you cater to the greedy – the people at the bottom realise that they’re getting ripped off and stop. It’s not that they’re lazy, it’s that they’re sick of working hard and seeing other people benefit from it but not them.

      • Xtasy 1.4.1

        It is scientifically proven that FEAR and STRESS kill brain cells. So the neo liberal “Natzis” that love to instill the fear into every working and especially non-working person, they are doing endless damage to the health of uncountable persons. This will prove to be very costly for future generations, having to foot the health costs for treating the damaged.

        Only later generations will have to cover for that, the health costs, that will come as a result of draconian welfare reforms, of unjust, harsh working conditions and the like.

        http://thinkprogress.org/economy/2013/08/30/2555601/living-poverty-effect-brain-constantly-pulling-nighters/

        http://www.sciencemag.org/content/341/6149/976

        It is time the Australasian Faculty of Occupational and Environmental Medicine (AFOEM) and Royal Australasian College of Physicians, same as local NZ science institutions accept and acknowledge this, not the crap of some NAZI like Principal Health Advisor Dr David Bratt, working for MSD and WINZ, or Mansel Aylward, present us, that “worklessness” is the problem.

        It is inequality and poverty that do the damage, and work may be good for some, may be ok for others, but it is rather a healthy, balanced, fair and decent life and society that delivers the best health outcomes, independent from paid work, voluntary work or anything else so conditional as this present NZ government wants to indoctrinate us with.

        Where are the “Down Under” scientists opening up for real, fact based, balanced and fair science? Or are they all on the payroll of UNUM and the likes?

        http://nzsocialjusticeblog2013.wordpress.com/2013/09/02/medical-and-work-capability-assessments-based-on-the-controversial-bio-psycho-social-model/

        http://accforum.org/forums/index.php?/topic/15188-medical-and-work-capability-assessments-based-on-the-bps-model-aimed-at-disentiteling-affected-from-welfare-benefits-and-acc-compo/

        P.S.: Don’t know why this ended up under Draco’s comment, but I may have clicked the wrong template or what. Anyway, it is not so much about what Draco mentioned, but I hope it makes sense. Good night all!

        • Johnm 1.4.1.1

          Xtasy
          If you beat a person with the stick of poverty and hopelessness long enough and the inequality of contempt and powerlessness most may never get up again and indeed an underclass of the hopeless is truly created. Then continue demonising them through the media and idiot bigot jocks like Laws on Radio Live and you get a fascist circus of wretchedness of spirit both with the haves and the havenots. Also a predator class of get rich by capital gain landlords feeds off the poor and their meagre welfare benefits by supplying run down accommodation which is damp and mouldy and cold enter illness and depression. Then the hospital visits and incapacity, and the draconian response and homelessness and begging and deaths from exposure.

          A society that advances in a unified way without destructive inequality is the pattern for success where parasitical elements who prey on their fellow citizens are controlled.

  2. gem 2

    Good post. To counter the right this election, the emphasis should be the fact we have to have big government to deal with the social problems wrought by inequality/free markets/structural unemployment. This could act as a sort of triangulation against the right’s spin that big government is the province of the left. National is fond of telling us it is spending record amounts on welfare/health; turn it around on them.
    I can’t find the passage in TSL I wanted to quote on this point, but this is similar:
    ”If you fail to avoid high inequality, you will need more prisons and more police. You will have to deal with higher rates of mental illness, drug abuse and every other kind of problem. If keeping taxes and benefits down leads to wider income differences, the need to deal with the ensuing social ills may force you to raise public expenditure to cope.” (page. 246)

  3. Whateva next? 3

    …..but how to get the message to the great undecideds??

  4. James Thrace 4

    Max Rashbrooke’s book is a fantastic read.

    Particularly where he outlines that the shift has moved away from seeing the family as a social unit towards the family being seen as expendable units of labour and consumerism in an industrialised capitalist complex rather than as a community driven unit.

    It really does grasp the bare roots of the problem in NZ in that it has become all about Me, Myself and I.

    Thatchers claim that there is no such thing as Society was taken a bit too far. I posit that in NZ there is no such thing as an individual without Society.

    Society breeds the individuals we have. It does more to explain the various natures abundant in NZ and the lack of rational behaviour exhibited by certain members of the community towards the need to assist those around them, and only assisting themselves.

    The Spirit Level has no doubt opened the door for a lot of people into understanding and beginning to grasp the inherent ‘wrongness’ of one CEO being paid $4M a year while the backs of the workers upon which said CEO is paid exorbitant rates, are valued at little more than $45,000 per year.

    Unfortunately, I have yet to see this conciousness seep through into more than two of our political parties. Green and Te Mana both understand this. I wait with bated breath for Labour to finally understand that there is a need to introduce salary capping, or even bring in higher taxes for those most able to afford them, such as the aforementioned CEO.

    • Colonial Viper 4.1

      In the 1950’s and 1960’s the USA used income tax rates as high as 91% to effectively limit top salaries.

    • gem 4.2

      Labour is weak-willed and out of touch on CEO pay and tax. It will be interesting to see what’s in tomorrow’s speech, but Parker in the Listener this month said he wanted top personal rate of tax would be 39% (on incomes over $150k), and no change to the business rate. I think that’s the same as the 2011 manifesto.
      In Britain, Labour has just announced it will reinstate the 50p rate on personal income over £150k (it is 45p at the moment).
      And why isn’t Labour talking about a financial transactions tax? This could solve the dilemma of taxing overseas purchases. OK it’s not without its issues, but surely worth exploring.
      Did Labour MPs use their Opposition downtime constructively to seek out some new ideas?

      • greywarbler 4.2.1

        FTT – Tobin tax? A small one – is it less than 1% usually suggested – on each deal, then a lesser GST tax, suggest 10%. That would go a long way to achieving better tax takes, and it is really not fair to tax over 48% at the highest.

        And let’s have inheritance tax and Capital Gains Tax and Stamp Duty and those useful taxes that took money off those receiving dosh often on inflated profits as on property. Always wanting less tax and very simple tax is a twisted way for the wealthy who are anything but simple, to act when it comes to taxes.

        Complicated taxes to the rich are merely like cryptic crosswords, lots of people can handle them easily. For those that can’t there are people you employ to find ways round them and it creates a nice area of financial management that keeps semi-criminals happy. Meanwhile most people would be paying sufficient tax to run the country yet enable them to have a hefty whack left for themselves.

        By the way I was reading a 2005 Listener and it referred to certain people in the lower South
        Island as being the Tartan Mafia. Who are they?

        • gem 4.2.1.1

          Yes, FTT is also known as Tobin tax. There is no need to have FTT and GST; just have the FTT, the revenues could be huge. Unlike GST, FTT is progressive.
          The percentage take is tiny, for instance, less than 1%, more like 0.1% on each and every transaction; the level is flexible, depending on transaction type, volume of transactions etc.
          Jim Anderton’s New Labour and its successor entities all promoted it.
          ”Always wanting less tax and very simple tax is a twisted way for the wealthy who are anything but simple, to act when it comes to taxes.”
          Yes, I love it how the regressive things have to be universal, but entitlements have to be ”targeted” to those deemed needy.

        • Plan B 4.2.1.2

          I think they were people in money in Dunedin and Central Otago , associated or owning Forsyth Barr. People like Howard Patterson etc. Very rich and fingers in many pies down there.

  5. Bill 5

    Two quotes from a speech given in 1972 by Jimmy Reid that’s (sadly) as relevant today and half a world away as it was then.

    A rat race is for rats. We’re not rats. We’re human beings. Reject the insidious pressures in society that would blunt your critical faculties to all that is happening around you, that would caution silence in the face of injustice lest you jeopardise your chances of promotion and self-advancement. This is how it starts, and before you know where you are, you’re a fully paid-up member of the rat-pack. The price is too high. It entails the loss of your dignity and human spirit.

    I am convinced that the great mass of our people go through life without even a glimmer of what they could have contributed to their fellow human beings. This is a personal tragedy. It’s a social crime. The flowering of each individual’s personality and talents is the pre-condition for everyone’s development.

    If you’ve never read his speech given to Glasgow University students in ’72, then here’s the link.

    http://www.independent.co.uk/news/uk/politics/still-irresistible-a-workingclass-heros-finest-speech-2051285.html

    • Anne 5.1

      Chris Hipkins goes some way to rehabilitate his reputation in my eyes:

      Labour supports Green’s Education measures

    • karol 5.2

      Ah. And he said all that in 1972. And he n=ends with a quote from the people’s poet, Rabbie Burns – (although I guess the patriarchal language was of its day – but otherwise, great sentiments).

      The golden age, we’ll then revive, each man shall be a brother,

      In harmony we all shall live and till the earth together,

      In virtue trained, enlightened youth shall move each fellow creature,

      And time shall surely prove the truth that man is good by nature.

      And tis around the time of Burn’s aniversary.

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