Blair was right, Labour does need to move out of its ‘comfort zone’ – the comfort zone of refusing to discuss inequality.
Blair is back, in case you missed yesterday’s speech marking his 20th anniversary since being elected Labour leader.
Much of the focus was on his not-so-subtle critiques of Ed Miliband, but one thing also stood out – his claim that he has under a fifth of the £100m some claim he has. “It’s not about making money,” Blair said.
Whether his own estimation of his wealth is true or not – and his and Cherie’s property portfolio is valued at around £30m alone – it raises big questions about the gap between political leaders and the people, and what the ‘elite’ see as a normal amount of money.
In light of this (and the upcoming release of the Spirit Level documentary), we look at the New Economics Foundation’s new report outlining how to reduce the staggering inequality that has emerged in the UK – of which Blair in both his personal wealth and political policies played a part. There are seven key solutions – all of which can be supported by the ‘centre-ground’ Blair tells Miliband to embrace.
1. Setting an inequality reduction target. Four out of five people want the government to act to reduce inequality. We have targets on climate change and child poverty – why not for reducing inequality, too?
2. Establish a commission on inequality. A high-level body constantly working on reducing inequality would do much to raise the profile of the issue – and force politicians to act.
3. Universal affordable childcare. Childcare costs should be capped at 15% of income. Decent childcare can transform people’s social mobility and remove barriers to a better life. A publicly-funded service would do much to level a very unequal playing field.
4. Reverse the falling wage share. It’s no news, but wages have been falling as share of GDP for decades while executive pay has soared. In large part, this is down to a lack of collective voice in the workplace since the Thatcherite deunionisation policies of the 1980s and 1990s (with anti-union laws left mostly in place by Blair)
5. Access to real career opportunities. For too long non-graduates have been shunted into minimum-wage, insecure jobs that have no chance for career development. Pooling private training investment by sector and state support to ensure apprentices can end up with actually progressing jobs would do a lot to tackle the stagnation happening at the ‘bottom’ of the work ladder.
6. Good jobs for all. Decent work should be a right. That means a fair wage and job security. To get there however, we need a national industrial strategy, a state investment bank with a regional focus, collective bargaining and better work and training investment.
7. Tax. It’s obviously a dirty word, particularly when talking about inequality. But the poor pay too much tax, and the rich too little (it’s often only the former that’s heeded in policy terms). Billions are dodged in tax every year by corporations and individuals, while ordinary consumers are increasingly hit by higher regressive VAT.
To sort out the problem, we need to shift tax onto land (it’s nigh-impossible to move land and thus avoid tax unlike cash) while making income and wealth taxes more progressive. At the same time, we can move the tax focus into discouraging environmentally-damaging practices (including pollution).
In a way, Blair was right; Labour does need to move out of its ‘comfort zone’ – the comfort zone of declining to discuss inequality.
The paradox is however that, as individuals (and business empires) such as Blair and co grow richer, the ‘political capture’ at the top may make these solutions ever harder to implement.
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