2013 could be the year in which Britain realises how unsustainable inequality has become, suggests Danny Dorling. Part of our series of short contributions from writers and activists looking to the year ahead.
The year 2013 is the centennial anniversary of the year in which income inequality in Britain last began to fall. In 1913 the richest 1% of people in the country took home almost a quarter of all income. A year later their share had dropped by more than a percentage point, and it continued to drop for a further 66 years. Lloyd George, then Chancellor of the Exchequer, realised that the country could no longer afford the excesses of the rich. Greater rights for women played a part. Income inequality began to fall within months of when Emily Davison was killed by the King’s horse in 1913. Later revolution in Russia contributed as it spread fear among elites in Europe. Trade unions strengthened and inequality continued to fall as a result of many other battles being won.
The initial instrument was taxation, though later such skewed redistribution from the rich via the state became less necessary as pay rates became much more equal and controls were placed on accruing riches through unearned incomes. The top tax rate in Britain rose from 5% in 1907, to 50% in 1919. It stands at 50% today, but is about to be lowered to 45%. This will increase income inequality. Benefit payments are to be reduced in real terms over the course of the next three years and this will further increase income inequality.
Early in 2010, Nick Clegg complained that the gap between the mean average incomes of the richest fifth as compared to the poorest fifth of people in Britain had risen from 6.9 to one, in 1997, to approaching 7.2 to one towards the end of Labour’s 13 years in power. Yet early in 2013 he defended the real terms cut in benefits that will widen this inequality further, mostly for people in work. British centrist politics has moved quickly from seeing growing inequality as wrong, to considering it inevitable in the short term.
In the large majority of affluent countries income inequalities are already lower than in Britain. There, the sense of common purpose and respect for, and trust of, fellow citizens is usually stronger. Almost no one in Britain in 1913 noticed that income inequality began to fall that year. In 2013 many people will note the rise in income inequality. It could be the year in which Britons begin to realise both how great the economic divisions between them have become, but also the economic impossibility of both maintaining such divisions and sustaining a sense of common purpose.
For almost everyone in Britain today, those above them are not sharing in the extra suffering, on average, as much as they are. To distract attention from this reality, the right wing will be tempted to stoke division, to talk of fecklessness, to blame poorer immigrants for fewer job opportunities and to suggest we need imprison more of the young to maintain discipline. The left needs to respond by emphasising social solidarity, common purpose and reminding everyone of those 66 years in which we were last becoming progressively more equal.
Danny Dorling is professor of human geography at the University of Sheffield. He is the author of You Think You Know About Britain and, most recently, The No-Nonsense Guide to Equality.