In the latest issue:

Real Men Go to Tehran

Adam Shatz

What Trump doesn’t know about Iran

Patrick Cockburn

Kaiser Karl V

Thomas Penn

The Hostile Environment

Catherine Hall

Social Mobilities

Adam Swift

Short Cuts: So much for England

Tariq Ali

What the jihadis left behind

Nelly Lahoud

Ray Strachey

Francesca Wade

C.J. Sansom

Malcolm Gaskill

At the British Museum: ‘Troy: Myth and Reality’

James Davidson

Poem: ‘The Lion Tree’

Jamie McKendrick

SurrogacyTM

Jenny Turner

Boys in Motion

Nicholas Penny

‘Trick Mirror’

Lauren Oyler

Diary: What really happened in Yancheng?

Long Ling

The Inequality ProblemEd Miliband
Close

Terms and Conditions

These terms and conditions of use refer to the London Review of Books and the London Review Bookshop website (www.lrb.co.uk — hereafter ‘LRB Website’). These terms and conditions apply to all users of the LRB Website ("you"), including individual subscribers to the print edition of the LRB who wish to take advantage of our free 'subscriber only' access to archived material ("individual users") and users who are authorised to access the LRB Website by subscribing institutions ("institutional users").

Each time you use the LRB Website you signify your acceptance of these terms and conditions. If you do not agree, or are not comfortable with any part of this document, your only remedy is not to use the LRB Website.


  1. By registering for access to the LRB Website and/or entering the LRB Website by whatever route of access, you agree to be bound by the terms and conditions currently prevailing.
  2. The London Review of Books ("LRB") reserves the right to change these terms and conditions at any time and you should check for any alterations regularly. Continued usage of the LRB Website subsequent to a change in the terms and conditions constitutes acceptance of the current terms and conditions.
  3. The terms and conditions of any subscription agreements which educational and other institutions have entered into with the LRB apply in addition to these terms and conditions.
  4. You undertake to indemnify the LRB fully for all losses damages and costs incurred as a result of your breaching these terms and conditions.
  5. The information you supply on registration to the LRB Website shall be accurate and complete. You will notify the LRB promptly of any changes of relevant details by emailing the registrar. You will not assist a non-registered person to gain access to the LRB Website by supplying them with your password. In the event that the LRB considers that you have breached the requirements governing registration, that you are in breach of these terms and conditions or that your or your institution's subscription to the LRB lapses, your registration to the LRB Website will be terminated.
  6. Each individual subscriber to the LRB (whether a person or organisation) is entitled to the registration of one person to use the 'subscriber only' content on the web site. This user is an 'individual user'.
  7. The London Review of Books operates a ‘no questions asked’ cancellation policy in accordance with UK legislation. Please contact us to cancel your subscription and receive a full refund for the cost of all unposted issues.
  8. Use of the 'subscriber only' content on the LRB Website is strictly for the personal use of each individual user who may read the content on the screen, download, store or print single copies for their own personal private non-commercial use only, and is not to be made available to or used by any other person for any purpose.
  9. Each institution which subscribes to the LRB is entitled to grant access to persons to register on and use the 'subscriber only' content on the web site under the terms and conditions of its subscription agreement with the LRB. These users are 'institutional users'.
  10. Each institutional user of the LRB may access and search the LRB database and view its entire contents, and may also reproduce insubstantial extracts from individual articles or other works in the database to which their institution's subscription provides access, including in academic assignments and theses, online and/or in print. All quotations must be credited to the author and the LRB. Institutional users are not permitted to reproduce any entire article or other work, or to make any commercial use of any LRB material (including sale, licensing or publication) without the LRB's prior written permission. Institutions may notify institutional users of any additional or different conditions of use which they have agreed with the LRB.
  11. Users may use any one computer to access the LRB web site 'subscriber only' content at any time, so long as that connection does not allow any other computer, networked or otherwise connected, to access 'subscriber only' content.
  12. The LRB Website and its contents are protected by copyright and other intellectual property rights. You acknowledge that all intellectual property rights including copyright in the LRB Website and its contents belong to or have been licensed to the LRB or are otherwise used by the LRB as permitted by applicable law.
  13. All intellectual property rights in articles, reviews and essays originally published in the print edition of the LRB and subsequently included on the LRB Website belong to or have been licensed to the LRB. This material is made available to you for use as set out in paragraph 8 (if you are an individual user) or paragraph 10 (if you are an institutional user) only. Save for such permitted use, you may not download, store, disseminate, republish, post, reproduce, translate or adapt such material in whole or in part in any form without the prior written permission of the LRB. To obtain such permission and the terms and conditions applying, contact the Rights and Permissions department.
  14. All intellectual property rights in images on the LRB Website are owned by the LRB except where another copyright holder is specifically attributed or credited. Save for such material taken for permitted use set out above, you may not download, store, disseminate, republish, post, reproduce, translate or adapt LRB’s images in whole or in part in any form without the prior written permission of the LRB. To obtain such permission and the terms and conditions applying, contact the Rights and Permissions department. Where another copyright holder is specifically attributed or credited you may not download, store, disseminate, republish, reproduce or translate such images in whole or in part in any form without the prior written permission of the copyright holder. The LRB will not undertake to supply contact details of any attributed or credited copyright holder.
  15. The LRB Website is provided on an 'as is' basis and the LRB gives no warranty that the LRB Website will be accessible by any particular browser, operating system or device.
  16. The LRB makes no express or implied representation and gives no warranty of any kind in relation to any content available on the LRB Website including as to the accuracy or reliability of any information either in its articles, essays and reviews or in the letters printed in its letter page or material supplied by third parties. The LRB excludes to the fullest extent permitted by law all liability of any kind (including liability for any losses, damages or costs) arising from the publication of any materials on the LRB Website or incurred as a consequence of using or relying on such materials.
  17. The LRB excludes to the fullest extent permitted by law all liability of any kind (including liability for any losses, damages or costs) for any legal or other consequences (including infringement of third party rights) of any links made to the LRB Website.
  18. The LRB is not responsible for the content of any material you encounter after leaving the LRB Website site via a link in it or otherwise. The LRB gives no warranty as to the accuracy or reliability of any such material and to the fullest extent permitted by law excludes all liability that may arise in respect of or as a consequence of using or relying on such material.
  19. This site may be used only for lawful purposes and in a manner which does not infringe the rights of, or restrict the use and enjoyment of the site by, any third party. In the event of a chat room, message board, forum and/or news group being set up on the LRB Website, the LRB will not undertake to monitor any material supplied and will give no warranty as to its accuracy, reliability, originality or decency. By posting any material you agree that you are solely responsible for ensuring that it is accurate and not obscene, defamatory, plagiarised or in breach of copyright, confidentiality or any other right of any person, and you undertake to indemnify the LRB against all claims, losses, damages and costs incurred in consequence of your posting of such material. The LRB will reserve the right to remove any such material posted at any time and without notice or explanation. The LRB will reserve the right to disclose the provenance of such material, republish it in any form it deems fit or edit or censor it. The LRB will reserve the right to terminate the registration of any person it considers to abuse access to any chat room, message board, forum or news group provided by the LRB.
  20. Any e-mail services supplied via the LRB Website are subject to these terms and conditions.
  21. You will not knowingly transmit any virus, malware, trojan or other harmful matter to the LRB Website. The LRB gives no warranty that the LRB Website is free from contaminating matter, viruses or other malicious software and to the fullest extent permitted by law disclaims all liability of any kind including liability for any damages, losses or costs resulting from damage to your computer or other property arising from access to the LRB Website, use of it or downloading material from it.
  22. The LRB does not warrant that the use of the LRB Website will be uninterrupted, and disclaims all liability to the fullest extent permitted by law for any damages, losses or costs incurred as a result of access to the LRB Website being interrupted, modified or discontinued.
  23. The LRB Website contains advertisements and promotional links to websites and other resources operated by third parties. While we would never knowingly link to a site which we believed to be trading in bad faith, the LRB makes no express or implied representations or warranties of any kind in respect of any third party websites or resources or their contents, and we take no responsibility for the content, privacy practices, goods or services offered by these websites and resources. The LRB excludes to the fullest extent permitted by law all liability for any damages or losses arising from access to such websites and resources. Any transaction effected with such a third party contacted via the LRB Website are subject to the terms and conditions imposed by the third party involved and the LRB accepts no responsibility or liability resulting from such transactions.
  24. The LRB disclaims liability to the fullest extent permitted by law for any damages, losses or costs incurred for unauthorised access or alterations of transmissions or data by third parties as consequence of visit to the LRB Website.
  25. While 'subscriber only' content on the LRB Website is currently provided free to subscribers to the print edition of the LRB, the LRB reserves the right to impose a charge for access to some or all areas of the LRB Website without notice.
  26. These terms and conditions are governed by and will be interpreted in accordance with English law and any disputes relating to these terms and conditions will be subject to the non-exclusive jurisdiction of the courts of England and Wales.
  27. The various provisions of these terms and conditions are severable and if any provision is held to be invalid or unenforceable by any court of competent jurisdiction then such invalidity or unenforceability shall not affect the remaining provisions.
  28. If these terms and conditions are not accepted in full, use of the LRB Website must be terminated immediately.
Close

‘What​ do I see in our future today you ask? I see pitchforks, as in angry mobs with pitchforks, because while … plutocrats are living beyond the dreams of avarice, the other 99 per cent of our fellow citizens are falling farther and farther behind.’ Who said this? Jeremy Corbyn? Thomas Piketty? In fact it was Nick Hanauer, an American entrepreneur and multibillionaire, who in a TED talk in 2014 confessed to living a life that the rest of us ‘can’t even imagine’. Hanauer doesn’t believe he’s particularly talented or unusually hardworking; he doesn’t believe he has a great technical mind. His success, he says, is a ‘consequence of spectacular luck, of birth, of circumstance and of timing’. Just as his own extraordinary wealth can’t be explained by his unique talents, neither, he says, can rising inequality in the United States be justified on the grounds that it is a side effect of a broader economic success from which everyone benefits. As Henry Ford recognised, if you don’t pay ordinary workers decent wages, the economy will lack the demand to sustain economic growth.

Hanauer is in the vanguard of the ‘Fight for 15’, the campaign for a $15 minimum wage. Like Bill Gates and Warren Buffett, who have also issued loud warnings about inequality, he is heir to a long tradition of social concern among the wealthy in the US. They have reason to be worried. The last time inequality reached comparable levels was shortly before the Wall Street Crash. As Anthony Atkinson shows in Inequality: What Can Be Done?, inequality in the US fell for decades after the crash, before beginning to rise again in the 1970s.1 Since then the gap between the wealthy and the rest has grown steadily wider. The top 1 per cent now has nearly 20 per cent of total US personal income. In the 1980s, inequality in the UK went up even more sharply than in the US. Since then, overall UK inequality has been relatively stable but the income share of the top 1 per cent has increased significantly and now accounts for about 12 per cent of UK personal income. The important factors are rising inequality in wages, a decline in the share of the national income that wages represent as more money goes to corporate profits and dividends, and a reversal of redistribution from the rich to the poor.

The rise in inequality should not, Atkinson insists, be brushed aside as an inevitable effect of irresistible forces such as globalisation or developments in technology. It is driven by political choices. He puts forward 15 proposals on issues ranging from wages to overseas development. He puts a good deal of faith in the tax system as a means of reducing inequality but he acknowledges that it isn’t enough. Much of the evidence from around the world suggests that by the time you get to tax and benefits the battle has already been lost. In the US and the UK inequalities of market income (wages, income from self-employment, dividends etc) carry through to inequalities of income after tax and benefits. In practice, it’s hard to alter this through redistribution alone: the key is to change the way the rewards of economic success are distributed in the first place. The last Labour government succeeded in keeping inequality in check. But it didn’t reduce it. If you don’t change the nature of the economy itself, redistribution on its own will have you running up the down escalator.

Joseph Stiglitz, whose essays and articles of the last ten years – since just before the onset of the financial crisis – are gathered together in The Great Divide, is another writer who resists the argument that increased inequality is a corollary of economic success.2 In the US in 2010, the top 1 per cent accounted for an extraordinary 93 per cent of the growth in incomes; in this situation, he says, the ‘middle class is too weak to support the consumer spending that has historically driven our economic growth’. The consequence is that millions of people end up borrowing beyond their means, which makes the economy more volatile and vulnerable to shocks. ‘The fact is the economy in the years before the current crisis was fundamentally weak,’ Stiglitz writes, ‘with the bubble, and the unsustainable consumption to which it gave rise, acting as life support.’ He also rejects the received wisdom that greater trade flows will always increase general welfare: not, he says, when the removal of trade barriers is a euphemism for getting rid of decent regulation – all that will do is undermine wages and working conditions. His principal target, though, is corporate ‘rent-seeking’: profiteering in the financial sector and elsewhere which, far from contributing to economic growth, restricts it. He discusses many harmful practices, from loose regulation of the financial sector to corporate tax avoidance.

One of the strengths of Stiglitz’s analysis is that it goes beyond talk of Gini coefficients to address people’s everyday lives: the wages they earn, the debts they face and the opportunities their children will or won’t have. Robert Putnam’s Our Kids: The American Dream in Crisis is even more closely attentive to the changes that economic and social transformation have forced on families, schools and communities.3 Putnam presents a series of case studies of parents and their children, starting in Port Clinton, Ohio, the town where he grew up, then proceeding through middle America. He visits Bend, Oregon, which in the 1950s was a small logging town but by the 1990s had lost its mills. Bend has survived and indeed grown because its natural beauty and sunny climate have encouraged a construction and real-estate boom. It is now a town divided between those who are benefiting from the boom and those whom prosperity has passed by.

Putnam focuses on two young people, one from each side of the tracks. Andrew is the son of Patty and Earl, who run a construction business. He has security and access to resources; he has made it to college, and can plan his future with confidence. Kayla is the son of Joe and Darleen, who met as ‘low-wage refugees’ at Pizza Hut. Kayla’s childhood was marked by economic hardship; her parents broke up, and she now lives with her boyfriend and sick father, trying to deal with his illness and a fear of ‘everything kind of falling apart’. Putnam supplies a series of ‘scissors graphs’ comparing the socioeconomic experiences over the last few decades of the children of parents who left education at 18 or earlier with those of children who go on to get a college degree. Whichever measure you choose – family breakdown, amount of time spent with children, the availability of informal mentoring networks – the pattern is the same: thirty years ago, the two groups were close together; since then, they have steadily grown further apart. Putnam doesn’t dismiss the cultural shifts that might have contributed to these trends, but he insists that a significant part of the blame lies at the door of economic policy: ‘Poverty produces family instability, and family instability in turn produces poverty.’

My experience as a politician fighting on these and related issues – both in areas where I succeeded in making the case and those where I didn’t – taught me several things. First, the terms of the case against inequality have changed. I have always believed that inequality divides people, deprives many of the chance to succeed and makes us all worse off. But now there is good reason to believe that inequality isn’t just unfair but that it actually inhibits economic growth. ‘Widening income inequality is the defining challenge of our time,’ the IMF announced in a report last year: ‘We find an inverse relationship between the income share accruing to the rich (top 20 per cent) and economic growth … the benefits do not trickle down.’ Last May, the OECD published a study entitled In It Together: Why Less Inequality Benefits All. All this makes it possible for us to talk about equality not only in terms of fairness, but also as the means to prosperity. The UK is deeply unequal and has an unproductive economy when compared to its major competitors. There are good grounds for thinking the two facts are connected: a low-wage economy, which doesn’t invest properly in its workforce, is an unproductive economy. The mechanism that links low growth to inequality is still debated: some say that low wages for the majority cause low demand and low growth; others say that the social exclusion of a large segment of society has a depressive effect. But what is clear is that inequality must be tackled not just because it is important to distribute resources fairly but also in order to secure higher growth, from which everyone can benefit.

Second, it’s too common to hear the mid-20th century talked about as if it were a ‘golden age’. ‘I hadn’t realised,’ Stiglitz writes, ‘when I was growing up in Gary, Indiana, an industrial town on the southern shore of Lake Michigan plagued by discrimination, poverty and bouts of high unemployment, that I was living in the golden era of capitalism.’ It’s true there was greater income equality at the time – but what about gender equality, gay rights and civil rights? It would be wrong, too, to romanticise the working conditions of the period. The wish to return to an imagined 1950s is partly driven by the rapid rate of change in present-day working conditions, including the increase in self-employment based on new technology – what has been called the ‘Uber economy’. According to a recent study by the Freelancers Union in the US, 53 million Americans are now self-employed, including 38 per cent of millennials. In the UK, rates of self-employment are soon likely to overtake public sector employment. For some, this could mean greater control and autonomy. But for others it brings the prospect of greater inequality and insecurity, especially where self-employment is another name for casualised labour. The imperative must be to shape an agenda adequate to this extraordinary wave of change, championing the needs of this new workforce and setting out a fair division of risk between employer, individual and government. Further along the road, we’re told, we will enter a ‘second machine age’, in which jobs will be lost to automation in ever larger numbers, further widening the income gap.4 On the other hand, automation and the increase in productivity to which it leads create the opportunity to take unpleasant work out of human hands and, in the long term, to reduce working hours from their current very high levels. Some Swedish companies are already experimenting with a six-hour working day. This may be a long way off in the UK, but what we need to do is clear: avert the possibility of greater inequality that technological revolution carries with it, and instead share out the benefits of the higher productivity it will bring.

Third, tackling inequality demands that we act on all fronts. When I was the leader of the Labour Party, I said that we needed to talk not just about redistribution but also about ‘predistribution’. The word is ugly, but the idea was right. You can only do so much with tax and transfers: the more wildly imbalanced the economy and earnings, the harder it is, especially in a globalised economy, to do anything about inequality. And the more unbalanced the initial distribution of income, the harder it will be to win political support for progressive taxation, given the strength of the forces opposed to change. The living wage and the introduction of proper rules on executive pay are at least as important as rates of income tax. We need, too, a much more open discussion about the top 1 per cent. We should acknowledge the contribution they make as well as the burden they place on everyone else. The entrepreneurs, inventors and software designers who reap big rewards often make a big contribution to the creation and sustaining of jobs, but what balance should be struck between how much they are rewarded – and how much more than others in their companies – and how much they are taxed? Until quite recently, people would ask why it mattered that those at the top were doing so well, as long as everyone else was prospering too. But it can’t any longer be denied that the scale of the rewards reaped by the 1 per cent has the effect of denying others. The scale of the effect is, of course, particularly visible in the London housing market, with wealthy buyers, many of them from outside the UK, pushing up prices and putting London out of reach for a great many people.

Fourth, there is, as always, the political question: who supports change? Labour’s focus, under my leadership, on the squeezed living standards of those in the middle was an attempt to make the point that inequality isn’t just an issue for those at the bottom: it’s something that affects the majority. But more has to be done to show middle-class voters why inequality matters. People have to be persuaded of its long-term impact on median wages and living standards, as well as its growth-dampening effects. There is a growing body of evidence that income inequality and unequal opportunity are linked – it isn’t a coincidence that social mobility has ground to a halt in the UK and the US at the same time as income inequality has grown – and the effects are psychological as well as material. It’s clear that even the more affluent families Putnam interviews have a deep sense of insecurity about the future. Inequality isn’t just a matter of income: it affects, among other things, opportunity, security and people’s ability to shape their own lives. Businesspeople in the UK, in contrast to those in the US, have tended to be reluctant to speak out on inequality. But some do support the living wage, not just as a matter of social justice but on the grounds that it increases productivity by improving staff retention and motivation. People in the private sector with views like this have to be mobilised in the campaign against inequality.

Fifth, and finally, there is the question of how political change happens, and how to mobilise the millions of people needed to bring it about. Labour must make use of the opportunity afforded it by the remarkable number of new members it has gained since the general election. But it also needs to acknowledge the challenge it faces. The party emerged from the traditions of community organising, and some local Labour branches are now rekindling that spirit. To succeed, the party needs to be about more than knocking on doors, crucial though that is, and the passing of resolutions. Labour needs to use its expanded membership to build deeper roots in local communities, and to help people find the collective power to change things. In a way I didn’t manage, it needs to reinvent itself as a genuine community organisation.

This is a tough time to be a progressive in Britain, with the re-election of a government that seems determined to dismantle the progressive institutions that remain and to make inequality worse. Labour’s renewal must be built on ideas, the most underrated commodity in politics. Ideas create and sustain movements and inspire people – and indeed voters – to join a cause. The right can’t solve the problem of inequality because to do so would be to abandon too much of what they believe, from a belief in the small state to trickle-down economics. The deep injustices of modern capitalism compel us to find a better way of living together. The left should approach the coming years with a determination to renew itself but also with confidence in its values.

Send Letters To:

The Editor
London Review of Books,
28 Little Russell Street
London, WC1A 2HN

letters@lrb.co.uk

Please include name, address, and a telephone number.

Letters

Vol. 38 No. 6 · 17 March 2016

Richard House is a little too generous to the Conservatives when he says that if they can keep around a quarter of the registered electorate sufficiently happy, then any suffering experienced by the rest won’t matter electorally (Letters, 18 February). At last May’s general election, 30.7 million votes were cast by a registered electorate of 46.4 million, 11.3 million of them for the Tories. The estimated eligible electorate is 52.4 million. According to these numbers, the government was supported by just 21.6 per cent of the potential electorate. Now that we are shifting from a system of household electoral registration to an individual one, the situation for the country is likely to get worse – though for the Conservatives much better.

David Packham
University of Bath

Vol. 38 No. 4 · 18 February 2016

Ed Miliband neglects to mention the effect of austerity on mental and physical health (LRB, 4 February). The closest he gets to it is a reference to ‘family instability’, and families having a deep sense of insecurity about the future. A Freedom of Information request to England’s mental health trusts revealed that there had been 8139 ‘serious incidents’ in 2014-15, an increase of more than a third over the previous two years, including a leap in unexpected deaths to 1714, including 751 suicides, up 22 per cent since 2012-13. The Conservatives’ economic policies have precipitated a rapid decline in people’s quality of life, and a massive escalation in stress and anxiety for millions of people. The calculation is simple: if the Conservatives keep around one-quarter of the registered electorate sufficiently happy, then, under first past the post, any suffering experienced by the rest won’t matter come the next election.

Richard House
Stroud, Gloucestershire

send letters to

The Editor
London Review of Books
28 Little Russell Street
London, WC1A 2HN

letters@lrb.co.uk

Please include name, address and a telephone number

Read anywhere with the London Review of Books app, available now from the App Store for Apple devices, Google Play for Android devices and Amazon for your Kindle Fire.

Sign up to our newsletter

For highlights from the latest issue, our archive and the blog, as well as news, events and exclusive promotions.