Let’s start off with a big one, just to grab your attention.
The world’s 4 richest people have more wealth than the poorest 57 countries.
Is that true? Can that be true? No, that can’t be true.
It’s true. You want to know how deeply fucked up the world’s economic system is, just look at that fact. Four people are worth more than 57 entire countries. Do they work that hard? No. Are they that creative? No. Have they built an empire that employs half a billion happy workers? No.
Is politics unimportant? No.
Let’s move on.
In the UK, since 1981 wages for the bottom 98% have fallen by 18% (7% last year alone) and for the top 2% have grown 900% (200% last year alone).
“What the fuck?” (you should be saying). “You mean I’ve worked for 30 years to become nearly 20% poorer, and the guy who runs the company is almost 10 times richer?!
Yes, that’s exactly what I mean. I’m not saying capitalism is evil. I don’t believe it is. But there’s more than one shade of capitalism, and the shade we use at the moment isn’t working for the vast majority of people. We need a gentler, softer shade. There is plenty of money out there. The UK has over £3 trillion in savings, 87% of which is held by banks and the richest 2% of the population. We just need a system which shares that money more equitably.
“But it’s shared pretty well right now”, I hear you cry.
Since 1981, 100% of gains in GDP have been spent on tax cuts, pay rises and benefits for the top 2%. The bottom 98% have received no net benefit at all from growth.
Hold on: so not only have I been working for 30 years to get poorer, but as my nation’s income has grown, literally 100% of the additional wealth has been spent on the people at the top?
Yes. That’s right. You may read in the tabloid press that benefit scroungers are killing us all, yada, yada, yada. Not so. The percentage of our nation’s income spent on benefits and tax breaks for the lowest paid 98% of people has not changed. The number of actual pounds spent has gone up, yes, but as a percentage of the money available it’s remained the same. All the increases have been spent giving tax breaks to that guy upstairs who drives the Jaguar and goes home at lunchtime on Friday.
Which brings me to the number of hours we all work.
In 1981 the bottom 98% worked an average 37 hour week with 23 days holiday. Today they work average 45.2 hours and have 17 days holiday. The top 2% work an average 31 hours and have 46 days holiday.
Since 1981 productivity amongst the bottom 98% has increased 23%, but wages have fallen 19%.
So we work longer and harder, and generate more and more profits for less and less pay, and for no share in the increased profits made by the nation.
And the boss works less and less hours, for more and more pay, and gets all the money. Lovely. Isn’t neoliberal capitalism a splendid thing? Keep voting Tory folks, it’s definitely what’s best for you. It says so in those newspapers which are owned by people who are all part of the top 2%, and who are major contributors to the Tory party.
But surely we need Tories to take care of businesses? Labour are anti-business. And after all, business pay a lot of tax.
In 1981 for every £1 of tax paid by individuals, £1.50 was paid by companies. Now for every £1 paid by individuals, companies pay 22p.
So the company doesn’t pay tax, but high earners do. They keep telling us they’re taxed heavily. I can’t remember the figures, or how it compares with historical norms, but they’re squeezed and struggling and…
In 1981 the richest 2% paid an average of 62% personal tax. Now they pay an average of 19%.
That’s a lower percentage than I pay! How do they pay so little?
Well, kiddo, because there are a large number of tax breaks for people who are company directors, and if you pay an accountant £4,000 he’ll work out how to avoid paying most of your tax. If your tax bill is bigger than about £18,000, it’s well worth it. But you have to be a top 2% income to pay more than £18,000 tax.
So even if the top rate is 50%, very few company directors pay it. That’s why everyone wants to be made a director.
But surely, you say, lots of poor people are paying less tax too. I remember the bad old days of Labour in the 1970s, when we all paid a fortune.
In 1981 the poorest 40% of workers paid an average of 18% personal tax. Now they pay an average of 26% (even though more people pay no income tax as a result of earning too little).
OK, we know people are struggling right now, but their company is looking after them by paying into a pension pot. Instead of a big wage they get a decent personal pension.
In 1981 70% of people had pension. Now 17% do.
You’re scaring me.
But more people have money tied up in property, so they’ll be OK when they get older. Just get on the property ladder, and you’ll be fine.
In 1981 the average person saving 50% of disposable income had to save for 27 months to afford a deposit for an average house. Doing the same level of saving today, they have to save for 42 years to get a deposit.
OK, OK, it’s difficult for people, but David Cameron has launched the big society, and those people with a lot of money are always making charitable contributions. They’ll help us out.
Charitable donations in 2010 from the richest 2% were 0.03% of the total, even though they have 71% of total personal savings and 77% of the total disposable income.