Wednesday, March 11, 2015

Upwards redistribution in the UK

Who did well out of the UK's recession? It sounds like a stupid question - surely the answer is "no-one"? - but it turns out that a sinking tide didn't lower all boats. Instead, it just redistributed the wealth upwards:

The gap between richest and poorest has dramatically widened in the past decade as wealthy households paid off their debts and piled up savings following the financial crisis, a report warns today.


Evidence of Britain’s rapidly growing wealth gap was revealed by the Social Market Foundation (SMF), which analysed the changing incomes and savings of thousands of people. Its findings will be seized on by Labour as evidence that any recovery from the downturn is uneven and not shared across all income groups. However, the trends uncovered by the SMF began before the Coalition came to power, underlining the huge impact of the credit crunch on levels of affluence.

The graph shows the full story: the rich increased their wealth by 64% between 2004 and 2013, while that of the poor dropped by 57%:

[Image stolen from The Independent]

While its not mentioned in the article, the Conservative / LibDem policies of tax cuts for the rich and cuts for the poor undoubtedly contributed to this upwards redistribution. Yes, in a time of hardship, rather than helping those in need, the government pillaged them and gave their money to the rich. And that is simply vile.