Sara Ibrahim presents a preview of the Young Fabians breakout session at the Fabian Society New Year Conference tomorrow.
Sara Ibrahim is the chair of the Young Fabians
This Tuesday Ed Miliband made what will prove to be a seminal speech on the importance of fairer capitalism in our society. His instincts on this issue are spot on.
The latest edition of the Fabian Review had polling conducted by YouGov on the economy. It showed a staggering 70 per cent of those polled think that the gap between those at the top and everyone else is now too wide and crucially, that the very rich use their power and influence in ways that harm the majority.
There was also high support for the proposition that companies should be willing to forego some profit in order to recognise a wider responsibility to their employees, their customers and their communities and to ensure they invest more for the long-term, even if this means less money is paid out to shareholders.
On Saturday, the Young Fabians’ breakout session at the Fabian New Year’s Conference will address what fairer capitalism means for young people. Young people face a dismissal future if reforms to the current system are not implemented.
Whilst the government’s narrative has been that cuts have been made to safeguard the inheritance of the next generation, the impact has been the reverse.
Youth unemployment has topped 1 million, top up fees have increased to £9,000 per annum, affordable housing is scarce and the pensions’ time bomb still looms large.
It is young people who have so often been at the forefront of expressing dissatisfaction with the flaws in our economic system.
Patrick Diamond will argue in his opening remarks that not all issues can be reduced to economics alone as demonstrated by the riots in 2011. He will touch upon how consideration of matters including redistribution of wealth must be coupled with an updated social equality agenda.
The need for this has been put into stark relief by the long wait for justice in the Stephen Lawrence murder.
He will be followed by Zoe Gannon who will draw on her experience at the High Pay Commission to explore how the pay gap between the richest and poorest is damaging to the UK’s future prospects. It is of great concern for all those on the left that those who have perpetuated damaging financial practices in the city and beyond have remained so well insulated from the economic downturn.
We will also be joined by Gordon Marsden, shadow minister for further education, skills and regional growth who will discuss how government should support young people over the course of the economic crisis and the longer term.
He will address how there needs to be a joined up structure for both vocational and academic training. The Young Fabians welcome his practical suggestions for how we can prevent the youth of today becoming a lost generation.
Finally, Professor Mariana Mazzucato from University of Sussex will argue that we need more State not less if we are to encourage more entrepreneurship as typified by Steve Jobs. Whilst the State has played an increasing role in innovation, the returns on this investment needs to be realised.
In talking about responsible capitalism Ed Miliband has captured the zeitgeist. It is now for the Labour movement to flesh out his ideas and crucially to ensure that the electorate recognise this as a Labour agenda.
The Young Fabians debate, “The Next Generation: What should today’s young people want from a fairer capitalism?”, takes place tomorrow afternoon at the Fabian Society New Year Conference, for which half-day tickets are still available
See also:
• “Delivering fairness in difficult times”: Miliband outlines the “new reality” – Shamik Das, January 10th 2012
• Government needs to find a way to tackle high-cost lending – Johann Lamont MSP, December 2nd 2011
• Unless pay gaps are reduced, we’ll end up with Victorian levels of inequality – Shamik Das, November 22nd 2011
• Seek solutions to protests, not problems – Mike Morgan-Giles, November 2nd 2011
• Britain faces a crisis of state and market legitimacy – Will Straw, May 11th 2011
23 Responses to “How can we have fairer capitalism?”
Anonymous
And what of those who are given so much to start with that they don’t need ever to work and will still be richer at the end of their life than the hardest working?
Nick Leaton
That wasn’t the question, but I’ll answer it anyway.
Do you have kids?
Do you want to help them in life?
For almost all people that is yes.
What is then wrong in leaving something on the positive side behind for them?
The problem at the moment is that current and past generations far from leaving something positive, are dumping 7,000 bn of debt on them (rising with inflation), for them to pay off.
There is another little gem in your question. Being richer at the end than at the start. It’s true for quite a few. However, downward mobility is larger than you think. Why are they richer, if they haven’t worked? Very simple answer. They have spent less than they have received in interest, or in investing in companies, which benefits borrowers and workers.
That’s why redistribution isn’t the solution. The solution means saving and investment, even for the poorer. They can’t currently do that because the government is taxing them to pay for its debts. For example, 2,500 a year for someone on minimum wage.
Take an average person. Median wage earner who retired last year. They would have started work in 1964, on wages around 700 pounds a year, and in their last year earned 26,000 a year. If we take their total NI contributions and dropped into the FTSE, they would have had a fund of 561,546 pounds, generating an income of nearly 19,000 a year.
Now wages have gone up faster than inflation. So for someone doing the same now, they would have an even bigger income if things carried on as they have over the last 40 years.
At no point would they be worse off than the state pension, and by a long way.
Spending less than you earn matters. Taxation is just forced spending.
Anonymous
Perhaps a split that recognises risks taken by worker and investor – not sure how that goes with say futures market investor versus soldier or arms dealer vs life boat crewman. Ummm….
Let’s try an easier one – if there are losses…..
owner forced to lay off staff or sell business and assets vs workers get sacked. Have to see the stats on how many sacked workers end up skint vs how many business owners do to see where the losses really fall.
May be if we just made sure that no one gets mega rich and no one is destitute then the relative contributions in between could be sorted out somewhat sensibly?
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Mariana Mazzucato
And here is the link to today's Fabian Society session
http://t.co/rhomQ12V