Last night’s BBC Newsnight in the UK featured “an item on living standards”:http://www.bbc.co.uk/iplayer/episode/b0132003/Newsnight_03_08_2011/ (at about 29′) and an interview with Doug McWillians of the “Centre for Economics and Business Research”:http://www.cebr.com/ think tank (whoever they are). McWilliams asserted that the UK faces a decline in living standards of 25 per cent over the next 20 years or so because of wage competition from overseas: “we” are going to be 25 per cent worse off. I have no idea how plausible this is.{fn1} However, if I’d been the interviewer I’d have followed up by asking McWilliams, “so, the economy is going to shrink by 25 per cent over the next few years?” Because I’m pretty sure that the economy is going to continue to grow, and that McWilliams also believes this, (eventually, and maybe sluggishly) and asking that follow-up would have forced him to make it explicit that he thinks we face a future of contraegalitarian redistribution (and, judging by some of the other elements in the item, longer hours). Unfortunately, the question never came. Until these questions get asked though, we’ll still have a political debate dominated by the assumption that growth-promoting policies will provide people with better lives, even though it seems that they won’t. (Which doesn’t, of course, establish that in the absence of such policies things wouldn’t get even worse.) To protect and improve the real living standards of ordinary people, we need to get redistribution explicitly onto the agenda and not just allow the assumption that rising tides lift (the key political assumption of “left neoliberalism” it seems to me) to stand.
1. To be fair, McWilliams says the decline isn’t predetermined, but can be avoided if “we” provide ourselves with enough in the way of high-tech skills to “command a premium”. Of course this is another feature of the “left neoliberal” toolkit, but as the experience of new Labour shows, it is one thing to sloganize (“education, education, education”) it is another to actually change things.
UPDATE: For some reason Matthew Yglesias has “linked to this post”:http://thinkprogress.org/yglesias/2011/08/04/287553/the-new-labour-record-on-income-growth/ taking it to be a data-free assertion that Blair and Brown failed on inequality (I believe that they failed, but it isn’t the subject of this post) and then waving around a Lane Kenworthy graph that he’s fond of in refutation. Two points: (1) the only point in the post that touched on the failure of New Labour was the footnote, which alludes to their record on education not inequality; (2) “Brian posted a few months ago”:https://crookedtimber.org/2010/10/01/fun-with-gini-coefficients/ in response to “the last time”:http://thinkprogress.org/yglesias/2010/09/30/198683/new-labour-and-inequality/ Matt deployed his favourite graph against “me on New Labour’s record”:https://crookedtimber.org/2010/09/30/its-about-the-distribution-stupid/ on inequality, given that, I’m surprised Matt is still waving it around.