The idea of a Labour Government, deep in the pockets of the bourgeoisie, claiming to produce more equality at the same time as it is helping to make the conditions for it more and more distant, is nothing short of laughable – if the consequences weren't so tragic. Nonetheless, Labour will keep on trying to fool us, so we will have to keep on pointing out where they have failed, even according to their claims and predictions. These stand in sharp contrast to the reality.
Tony Blair has desperately been trying to leave a legacy for the people of Britain to remember him by. Workers is happy to provide him with one. Not really a legacy though, as Brown is now Prime Minister and this is equally his story . . .
In 1997, Peter Mandelson wrote, "I say to the doubters, judge us after ten years in office. For one of the fruits of that success will be that Britain has become a more equal society. However, we will have achieved that result by many different routes, not just the redistribution of cash from rich to poor, which others choose as their own limited version of egalitarianism..."
House prices – up, up, up
- Abbey Bank now offers mortgages of five times earnings to "help out" hard-pressed first time buyers. This has the effect of keeping property prices high. Specialist broker firm Mortgage Lender is launching a 50-year mortgage. 20 year-olds on this deal will still be paying off the debt in their 70s
- In rural areas such as the south west and Norfolk, properties are being sold at 14 times the average local salary
- "Buy to let" landlords are pushing up prices, using government tax breaks (unavailable to ordinary buyers) to buy up new and existing housing then letting, frequently to multi-occupation tenants, in urban areas often creating slum conditions. High rents are subsidised by you and me in the form of Housing Benefit.
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A new report, Closer to equality? Assessing New Labour's record on equality after ten years in government, published by Compass, examines Mandelson's claim. It finds growing inequalities in health, housing, wealth and wages.
"Health inequalities have increased year on year under New Labour. ... Regional geographical inequalities have risen faster under New Labour than they did under Margaret Thatcher." The mortality rates of infants born into manual workers' families have risen faster than the average. The differences in life expectancy between the best-off and worst-off areas of Britain have grown to record highs: 9.5 years for women and 12.3 years for men.
Personal services jobs boom; design and creative jobs fall
- 4 million people work in domestic service (cooks, cleaners, nannies, gardeners) – the same proportion of the population as in the 1860s
- Fastest growing occupation is hairdressing
- People employed in the "design workshop of the world" (Blair's words) fell by 15 per cent between 2002 and 2005. In the same period, overseas earnings from design fell by more than half
- "Creative industries" seen by Blair and Brown as future for Britain: value of exports in music, the visual and performing arts fell by 20 per cent between 2000 and 2003. Advertising employment fell by 20,000 in the same period.
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Hidden unemployment and wasted skills in 2007 (according to report by Sheffield Hallam University, June 2007 )
- Official unemployment 900,000 (on Jobseekers' Allowance) but the real rate of unemployment is probably at least 2.6 million
- 2.7 million claiming sickness and disability benefit (largely concentrated in ex-shipbuilding, ex-mining and ex-steel making areas) – at least 1 million of these could be working
- In former coalfields, five times as many claiming incapacity benefit as claim unemployment benefit
- 40 per cent in higher education, therefore "parked" out of the reach of unemployment
- Just under 8 million are "economically inactive"
- Apparent growth in numbers working largely accounted for by increases in mothers returning to work after childbirth, pensioners, immigrants: all tending to depress wage rates
- Growth in McJobs – casual, low paid, unskilled work (in shops, bars, hotels, domestic service, care home assistants)
- 750,000 estimated illegal agency workers
- Labour's "flexible" uninspected, ununionised labour market subsidises employers through government tax credits (i.e. by other workers) to workers who cannot live on what they earn.
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Houses have increasingly become speculative investments, their gains unearned and virtually untaxed. Consequently, "housing inequality has risen and decent, affordable housing is increasingly inaccessible for a growing percentage of the population. ... The demand for social homes has increased – yet supply has fallen. Despite the huge waiting lists, every year since 1981 has seen a net loss of social homes, as right to buy sales have far outstripped new homes built." So 1.6 million children are living in bad housing.
The government has kept the key elements of Thatcher's anti-trade union laws. It has boasted that "British law [is] the most restrictive on trade unions in the developed world." So now too few organise in their unions to win better wages and too many borrow themselves into debt. But the CEOs of Britain's ten biggest firms are not restricted: last year, they gave themselves rises three times the rate of the average wage rise.
Gordon Brown's policy of "open borders" for capital and jobs
- £75.5 billion spent by foreign corporations on buying British firms in 2006
- Steelmaker Corus sold to Indian company
- Liverpool football club sold to American company
- West Ham Football club youth academy sold to Icelandic company
- London Stock Exchange under threat of being sold off to Nasdaq
- British Airports Authority, Abbey National and O2 now Spanish-owned
- Pilkington Glass now Japanese-owned
- Smiths Electronics bought by US firm General Electric
- Thames Water bought by German company, stripped of assets, raised tariffs for customers, managers paid themselves £10 million in bonuses, sold on to Australian company
- One million jobs lost in manufacturing, construction and allied industries since 1979
- 200,000 manufacturing jobs lost in past two years alone
- 8,000 manufacturing jobs lost in January 2007 alone
- Deficit in traded goods (things made in Britain) in 2006 was £60 billion – the highest by far since World War 2. In this period Germany ran a record trade surplus as the highest exporting country in the world, and Japan's trade surplus stood at £50 billion.
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The government encourages the immigration of cheap labour from Eastern Europe to undercut trade unions: as the report warns, "Employers...are increasingly using low paid agency workers, often migrant workers, to drive down wages and conditions and undermine collective bargaining arrangements." Weaker unions mean more poverty and inequality. As even the OECD noted, "a stronger bargaining power of trade unions is associated with lower relative poverty and income inequality".
The government has given the very rich all the tax breaks they could want: minimal capital gains tax, non-domicile tax rules that cost us £16 billion in lost revenue every year, tax breaks for property developers (Brown's Real Estate Investment Trusts).
As a result, the share of wealth owned by the richest 1 per cent rose from 20 per cent in 1996 to 21 per cent in 2003; the poorer half's share fell from 8 per cent to 6 per cent. In 1996–97 the richest 10 per cent got 27.8 per cent of all income; the poorest 10 per cent got 2 per cent.
By 2005–06, the richest 10 per cent got 29.5 per cent; the poorest 10 per cent just 1.6 per cent. The richest 1,000 people had £98.99 billion wealth in 1997 and £360 billion in 2006, a 263 per cent rise. The share of national income going to labour is at an historic low; the share going to capital is at an historic high.
So, when we judge Labour after 10 years in office, what has their "unlimited egalitarianism" actually produced? Judge for yourself.
Blair and Brown's "booming economy" – awash on a sea of debt
- Personal insolvency (formerly known as bankruptcy) has risen from nearly 22,000 in 1999 to nearly 600,000 in 2006. Personal insolvency is now much higher than business insolvency
- Between 2000 and 2005 consumer credit (the amount we owe on our credit cards etc) rose by 65.8 per cent
- In the same period net mortgage lending rose by 94 per cent while average earnings rose by 22 per cent
- Total student debt now around £18 billion – more than the gross domestic product of Slovenia
- Student loans to be privatised by Brown – banks, pension funds and other investors keen to buy student debt as it guarantees a steady long term income collected by government
- There are calls for the interest rate subsidy on student loans to be scrapped
- Students graduating this year owe on average about £15,000
- Medical graduates owe about twice the average
- Students beginning university this September (40 per cent of 18-year-olds) will graduate with around £30,000 of debt
- UK Insolvency helpline has a student debt website on how to become bankrupt.
- Credit Action, a money education charity, calls student loans "government endorsed debt on a massive scale"
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