July 09, 2008

Inequality to fall

We are about to see a major reduction in inequality. After years of half hearted redistribution finally something that will actually produce a major reduction in inequality. Inequality always tends to reduce in a recession. This reduction in inequality is about as much the result of Gordon Brown deliberate plan as the previous years of growth were, none, but he has managed to make sure that there will be a much greater reduction by making sure that the recession will be much deeper than it need be.

Had he been following a prudent economic strategy, or even the classic Keynesian strategy, he would have stored up some economic reserves during the good times to be released now in order to reduce the impact of the recession. However he deliberately did not. He spent like a drunken sailor in port so there is nothing there to spend now. Not only did he spend everything he had he maxed out the credit cards as well, he cannot even borrow to try reduce the impact of the recession. In fact since government spending is going to have to rise due to the recession and there is no money to pay for it he is going to have to force even more taxes on us which is sure to deepen the recession.

Surely Polly and the Guardian should be shouting from the rooftops. Here is the economic genius that they promised us for so long. Here is Gordon's grand plan for reducing inequality finally coming to fruition. Why wouldn't left wing commentators be jumping for joy at this? For years we have been told that inequality is the worst thing to exist in our society, that people are literally dieing from their jealousy, and finally we are about to see an actual reduction in inequality.

They won't though. For the simple reason that going to the voters during a recession will turn an electoral defeat into a rout. People crowing about how the recession is actually a good thing and they should be grateful for such a skilful reduction in inequality would turn a rout into an annihilation. Inequality is not even close to the top of most peoples lists of priorities. Being able to afford the however bills is.

The fact that they almost never talk about inequality directly, always mixing it up the very different concept of poverty, speaks volumes. People don't really care about inequality that much. They don't care that much whether somebody else gets more money than they do, unlike certain parts of the left wing media people aren't primarily driven by jealousy, they care far about themselves and how they are going to pay their bills. Demanding other people hand over their money to you is a rational, if not moral, strategy; but not if you end up have to make sacrifices yourself as well.


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