Tuesday, August 05, 2008

Polly Toynbee's new book: "Unjust Rewards"

I've taken to reading newspapers so obsessively I sometimes have difficulty remembering that most of what is written in them is self-indulgent wank of a magnitude equaled only by my own bloviations.

In that spirit...

The area of political discussion in which I feel most conflicted is that of the distribution of wealth.

Polly Toynbee published a book today called Unjust Rewards. An excerpt from the book can be read here and another article discussing the same ideas can be read here.

History, many like to believe, is a Whiggish tale of wealth, social progress and fairer distribution, an onward march: we all wear the same clothes, meet on equal terms on Facebook.

[[[In terms of social deference, we are certainly more equal now.]]]

Yet background predicts who will run the banks and who will clean their floors. It's not happenstance; it is largely pre-programmed.

[[[This is an issue of education and social policy, rather than how much banks pay their employees.]]]

General mobility is a myth. The top 10% of income earners get 27.3% of the cake, while the bottom 10% get just 2.6%.

[[[The solution then, would be to work towards equality of opportunity.]]]

Twenty years ago the average chief executive of a FTSE 100 company earned 17 times the average employee's pay; now it is more than 75 times.
Toynbee uses a very specific line of attack. Rather than suggest that self-made entrepreneurs like Richard Branson, Felix Dennis, or Alan Sugar should pay up she is attacking "fat cat" directors, wealthy lawyers, and bonus-acquiring bankers:

High-earners tend to be elusive, preserving their privacy at home and at work, journeying between them in expensive cars.

[[[Nice lifestyle.]]]

But in sessions conducted by Ipsos Mori over two evenings we did meet partners in a law firm of international renown and senior staff from equally world-famous merchant banks.

Their business is money, and they make it: the law partners earned between £500,000 and £1.5m per year, putting them in the top 0.1% of earners in the UK, while the merchant bankers ranged from £150,000 up to £10m.

[[[Good money if you can get it then.]]]

Toynbee is suggesting it is unfair that people should earn these amounts of money. She demonstrates that they are both ignorant of the plight of the poor, but are still highly opinionated on social policy:

How much, we asked our group, would it take to put someone in the top 10% of earners? They put the figure at £162,000.

In fact, in 2007 it was around £39,825, the point at which the top tax band began. Our group found it hard to believe that nine-tenths of the UK's 32m taxpayers earned less than that.

As for the poverty threshold, our lawyers and bankers fixed it at £22,000. But that sum was just under median earnings, which meant they regarded ordinary wages as poverty pay.

[[[Ignorance is no excuse for anything.]]]

...

Once our conversation turned to tax, the high-earners' arguments against rebalancing the system ranged from threat to bluster to attack.

Response one: we will leave, and you will be poorer. Or: we don't deserve to be forced to pay more. Or: even if we were taxed more, the money would all be wasted.

[[[Well these are fair points. Still, I reckon it would still be fairer if people paid a little more on earnings over, say, £100, 000]]]
...

Masters of the universe our groups might be, but their outlook was pure Daily Mail: "Single people . . . get pregnant and get a flat and more money. You just see everybody pushing prams, then they'll get more income and a little flat that they can stay in for life."

[[[Which only demonstrates that stupidity and ignorance is no barrier to success, which is reassuring.]]]

There was much talk of the perverse incentives for single parenthood, with one banker complaining that the 18-year-old mother on benefits "doesn't get that much less money than another 18-year-old working in a shop". It didn't seem to occur to this speaker that the shop worker's pay might also be too low.

[[[Well OK. But his basic point that there is a perverse incentive to state-dependence remains.]]]

They were contemptuous of anything that gave extra money directly to poorer people: "This thing of giving pregnant women £200 for dietary supplements. Like, as if they'll really spend it on fruit."

[[[Chocolates and crisps and cola and donuts.]]]

Most were adamant, along with this banker: "We don't think just chucking money at the welfare state is the answer."

From what I can gather this is a polemical rant, on Toynbee's part, rather than a constructive attempt to actually work things out.

I think on balance I dislike Toynbee's hectoring self-importance more than the ignorance and prejudice of the wealthy.

1 comment:

Poor but Proud said...

I think you'll find in the book there are actually suggestions about how government can go some way to equalising life chances. But that would need the support of the super-rich. Clearly they need persuading! The two extracts are just the first part of the book.

There have been very few people publicly bothered about the plight of the poor so relentlessly as she has even though it makes her unpopular in certain quarters and a target of viscious ridicule from the Right. I wonder why.

Polly herself has frequently said that she herself is willing to pay more tax. So she for one puts her money where her mouth is.