Inequality is self reinforcing: "for him that hath, to him shall be
given: and he that hath not, from him shall be taken away even that which
he hath."
Put crudely, the extreme left view is that any inequality is unjust and
everyone should have an equal share; and the extreme right view is that no
constaints should be imposed on the progression to ever greater inequality.
The Third Way should take a route in between these extremes, it should
recognise that extreme inequality is bad in many different ways, it is immoral,
inefficient and distructive; while complete egalitarianism is unachievable,
inefficient and arguably meaningless. Somewhere between these extremes there
must be a degree of inequality where the poorest can have a decent life and not
starve but there is enough of an incomes gradient to provide incentive.
The nettle to be grasped is that this insidious trend to greater inequality has
to be controlled. In the past this has been done by progressive taxation and
"socialist" institutions such as strong unions and the welfare state. When they
were reduced in the Thatcher years, low and behold inequality increased and
society got nastier. Bringing inequality down again is going to be a major
struggle and is unlikly to be achieved just by patching up an ailing welfare
state.
One practical measure would be for the government to set itself a target for
inequality, just as it does for inflation. An acceptable index of inequality
(such as the incomes gradient) would be needed.
I also think some form of Citizens Income should be high up on the Third Way
agenda. As well as being a respectable, well developed idea, with cross party
support, it could provide a mechanism for the redistribution of wealth with
reduced interference in the lives of individuals by the state.
I am sceptical about sustainable full imployment. I am an engineer developing
improved products which I like to think of as a creation of wealth. I have seen
at first hand strong pressures in industry not to employ people. I, and
thousands of engineers like me, are beavering away developing new, more
"efficient" ways of doing things and, top of the list for this increased
efficiency, is to avoid the cost of human intervention. At the same time we are
probably all working in undermanned teams and have seen competent colleagues
made redundant for the sake of "efficiency". A Citizens Income would mean that
wages, particularly for the lowest paid, would be reduced and this in turn
would reduce the incentive to lay off workers.
I ask the ultimate question: are there any circumstances in which society is
willing for some of its members to starve? If the answer is no, then every
citizen is going to have an income somehow, so why not provide this by a better
route? Looking at the tax and benefits system as a machine, it is clear that it
is simply connected up badly. A Citizens' Income reconnects it in a better way.
John Greenwood jcg@argonet.co.uk
--Nicola Greenwood ngreenwood@argonet.co.uk
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