Tory chairman: Get off your Peloton and back to your desk

Thanks, didn't have the quote to hand!

Rendel Harris wrote:

chrisonatrike wrote:

Vines could only afford boots with cardboard soles and had to buy new ones every year whereas the rich could buy the one pair of good boots which lasted for ages. He concluded that wealth was about being rich enough to look scruffy.

Yes - the Vimes "Boots" theory of economics, a rich man could spend $50 on a good pair of leather boots that would still be warm and dry after ten years, whereas a poor man could only buy a $10 pair that would be leaking after one winter, so after ten years the poor man would have spent twice as much on boots and still have wet feet.

supporting the addage, buy cheap buy twice, or potentially 5 times

hawkinspeter wrote:

That's fair enough, but a big issue with low incomes is that a larger percentage of wages is spent on basics such as rent, food, electricity etc. The person on 50k might have living costs of 30k, whereas the person on 20k might easily have living costs of 18k, so the 2% increase in standard of living affects the lower incomes to a greater extent. Plus, there's the Captain Samuel Vimes ‘Boots’ theory of socioeconomic unfairness whereby living costs can decrease once you have more money (e.g. renting is typically far more expensive than owning a house).

Excessive housing costs is behind most of the other issues we have. It leads to benefits payments being required for people working full time, excessive housing benefit costs going to landloards for people without work. It reduces physical mobility of the labour force as the cost of relocating is also high. Overcrowding of homes leading to parking issues and blocked streets. (although this is also a result of car centric society)

Population has grown fatser than housing capacity for years despite all governments pledging to increase house building. But every proposal to build even a modest number of new homes is met by hysterical scream about concreting over the countryside.

1.1% of land is housing, while 62.8% is agricultural and 21% is open land, forests and open water. So a 10% increase in housing would have an unoticable effect on the the total green space in the country.

Building more quality energy efficient housing shouyld eb the second priority after reducing carbon emissions

Thatcher's right-to-buy has had long-lasting disastrous effects on the housing market:

https://www.theguardian.com/society/2015/aug/26/right-to-buy-margaret-thatcher-david-cameron-housing-crisis

But isn't the real issue that this comes out in human terms as "I still can only afford one and a half tins of beans now" vs. "I can't afford a second car!" - the quantitative "good news" story actually translates poorly into human stories.  Or into "really not much hardship" for the richer losing and "not feeling much better" for the poor gaining.

Of course we have some considerable and "irrational" biases because we're monkeys. But we *are* so that's important, no?

What are considered to be the lines for 'average' wage (outside London)?

At what salary is someone 'poor' or 'in poverty'?

brooksby wrote:

At what salary is someone 'poor' or 'in poverty'?

When they have to choose between heating or dinner

hawkinspeter wrote:

brooksby wrote:

At what salary is someone 'poor' or 'in poverty'?

When they have to choose between heating or dinner

Oh, I totally get that.

I meant in an objective "The average salary is xxx; you earn yyy therefore you are paid significantly more than / more than / less than / significantly less the average" sort of way.

brooksby wrote:

hawkinspeter wrote:

brooksby wrote:

At what salary is someone 'poor' or 'in poverty'?

When they have to choose between heating or dinner

Oh, I totally get that.

I meant in an objective "The average salary is xxx; you earn yyy therefore you are paid significantly more than / more than / less than / significantly less the average" sort of way.

 

Households are considered to be below the UK poverty line if their income is 60% below the median household income after housing costs for that year.

Although that measure is not without its quirks.

Post 2008 financial crisis the poverty level fell because the median income fell.

You could have conceivably become poorer yet still moved out of poverty.

wycombewheeler wrote:

Households are considered to be below the UK poverty line if their income is 60% below the median household income after housing costs for that year.

A bit of a health warning is needed around that. The relative poverty measure isn't really intended as a way of identifying whether individual households are or are not in poverty. It's more meant as a broad brush measure of poverty within a society as a whole. It takes no account of differing needs resulting from the make-up of households, local variations in the cost of living, etc.

When you apply it at a population level, that all tends to smooth out, but applying it at a household level is problematic.

Whenever you hear a politician saying things like 'we have lifted 25k households out of poverty', you know they're talking nonsense.

Hope I never have to but a mountaineer told me of a trick with pasta, a bidon and fruit drink powder that apparently accomplishes both AND gives you a lukewarm drink the next day. Not convinced about part 3 though.

"the trend goes all the way back to 2010."

Erm, did you look at the full graph on the BBC link or just the "tory" era? In 2020 we had only just got back to the same average as 2007. And that was with constant dropping of wages until 2015. How much of the rises since 2015 are just base increases to minimum wage as well? 

I can't comment on the Torygraph story from 2016 as I can't see past the headline though.

The telegraph article contains the stats from 2010 to 2015. I've included the relevant graph (!) below.

Whilst 'average' incomes fell the incomes of the poorest actually increased.

That trend has continued as you can see from the BBC graphs.

It doesn't matter if it is the minimum wage driving it, what matters is that lower incomes are increasing faster than higher incomes and have been for 11 years now.

Under a Conservative government.

This suggests that, after increasing significantly in the late 1980s, wage inequality has been on a slow overall downward trend since, regardless of government.

https://www.closer.ac.uk/data/9010-income-inequality-ratio/

The Gini coefficient of inequality of incomes net of taxes and benefits, from the same source IFS data, shows a rise in the late 1980s and basically static since then, implying that although the headline inequality may be reducing, that's basically been wiped out by the tax and benefits system.

From the same report you can see that income growth has been faster for the lower paid. Graph (!) attached.

Both the broader Gini coefficient and the narrower 90:10 have been largely flat but still lower than they were during the last Labour government.

...but also continuing the trend that was happening during the Labour government.

I'm not sure I agree with that.

The trend under Labour was for Gini to increase and 90:10 to stay fairly stable.

Both did begin to decrease after 2008 but I'm not sure that was anything to do with Labour policy.

Since 2010 both have stabilised below the average levels seen during the Labour administration and considerably below the pre 2008 levels.

I just don't see how you're seeing that in the charts.

Since yours seem to have got a bit mangled in the middle, and make it difficult to see what's going on with everything overlaying each other, here's the 90:10 chart from the original link I posted, with what I would see as an overall trend since ~1989 indicated.

And here's the Gini data from the IFS. I don't see any meaningful variation in that at all since 1989.

Both have a couple of smallish peaks, around the very end of the 90s, and then again around 2007, and start to go up again before the current crisis, but that suggests to me that those variations have more to do with general economic cycles than with any particular flavour of government.

Again I would disagree, I think there's a clear upward trend from the late 80s until 2008 then a sharp decline.

This is obviously fairly subjective though so I don't think we're likely to change each others opinions.

Rich_cb wrote:

In fairness, whilst the ONS have cautioned that the post pandemic figures aren't as reliable as usual, the trend goes all the way back to 2010.

Lower earnings are rising much faster than higher earnings under the Conservatives.

I'm confused. ONS say that income inequality is increasing.

"In the period leading up to financial year ending (FYE) 2020 (April 2019 to March 2020), just before the coronavirus (COVID-19) pandemic, income inequality steadily increased to 36.3%, according to estimates from the Household Finances Survey" https://www.ons.gov.uk/peoplepopulationandcommunity/personalandhousehold...

Oh no, surely it's "fairly subjective"? As our blustering blarophant of a PM likes to say, "Look, figures can say anything you want..."

That's just the one year.

The level tends to fluctuate, as can be seen in the graphs already posted, hence the discussion about trends.

Unfortunately Covid will compromise at least two years worth of data so trends are going to be even harder to detect for the next few years.

Rich_cb wrote:

That's just the one year.

From the same link - "During the 10-year period leading up to financial year ending (FYE) 2020 (April 2019 to March 2020), income inequality increased by an average of 0.2 percentage points per year to 36.3%, as measured by the Gini coefficient. "

The graph I posted earlier clearly shows Gini fluctuating over a fairly narrow range since 2010. So Gini is essentially flat as I stated in a previous comment.

It's is, however, considerably below the 2008 peak as can also be seen in the graph.

Rich_cb wrote:

The graph I posted earlier clearly shows Gini fluctuating over a fairly narrow range since 2010. So Gini is essentially flat as I stated in a previous comment. It's is, however, considerably below the 2008 peak as can also be seen in the graph.

Whilst 0.2% average per year is not a massive change, it is not flat, nor is it moving in the other direction as you seemed to suggest.  You are right about the 2008 peak, though.

In my opinion it's a flat trend, up some years, down others, oscillating just under 35%.

This last year has been the highest for a decade so to use that point to define a trend doesn't seem like the best approach.

Rich_cb wrote:

In my opinion it's a flat trend, up some years, down others, oscillating just under 35%. This last year has been the highest for a decade so to use that point to define a trend doesn't seem like the best approach.

I'll bow out now - I was surprised by your statement that income inequality had decreased so just did a quick google.  I can see your point about the lack of a trend from that table (at least until 2016-17) but I was just quoting the ONS.

Rich_cb wrote:

Which is why the incomes of the lowest paid in our society have risen faster than all other groups since 2010… https://www.telegraph.co.uk/news/2016/07/21/the-tories-are-destroying-la... https://www.bbc.co.uk/news/58793537

As others have pointed out, a grossly inadequate income rising slightly more than a very comfortable living isn't much comfort if you still have to chose between being warm and eating.

A very large problem in this country is inequality, the difference between the poorest and the wealthiest, and the UK is currently more unequal than East and West Germany before unification.

Despite over a decade of the tories being in charge, they haven't solved any of the problems of our society, they've just created more, then they claim to have the answers for the problems that they created, all from the mouth of someone who's been sacked multiple times for lying.  If only the media would hold them accountable and the masses weren't so gullible.