27 January 2017

Rewriting the rules of economics - 2

The second thing that jarred when I read MP Liam Byrne’s article is this.

Mr Byrne refers to those on a state pension, to whom the triple lock “will have channelled more than £33bn extra” by 2020. This is supposedly one of the groups who have done well while others have suffered.

However, this betrays an ignorance about the British state pension, which has dramatically decreased relative to wages, since the days when it was held out by the UK government as something that would hold its own against private sector pensions.

The current basic state pension is about a quarter of median income, and well below the cost of a minimum standard of living.

Incidentally, there is one possibility pseudo-egalitarian commentators seem not to consider with regard to the current high inequality readings. The readings arise to some extent from a small class of super-rich – footballers, popstars and others, many of whom benefit from the fact that contemporary mass media, mass entertainment and mass production are all geared towards the tastes of the homogenous majority. Even more redistribution of income towards the lower half of society may well result in readings becoming higher, not lower.