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Friday, 10th July 2009

Brown's legacy of inequality, poverty and joblessness

Fraser Nelson 3:21pm

We all know Labour has failed to run an efficient economy or public services, but what’s little discussed is its failure to achieve even its own goals. Had Brown bankrupted the country but, say, made the poorest much better off, then Labour members might not be facing such an existential crisis. As it stands they won three victories, trebled health spending, redistributed some £1.5 trillion – and will end up with a society even more ‘unequal’ than it ever was under Thatcher. I look at this in my column today, and thought I’d share a few of the points with CoffeeHousers.

First, equality. This (rather than making the poor better off) is the great leftist goal – and it can be nominally achieved by hurting the rich. But let’s look at the Gini index - which John Rentoul, who has written a book about inequality, regards as the most reliable measure.  The left were very agitated about this index when it shot up in the 1980s. But it’s even higher now:

So, by the Gini definition, Britain has never been more “unequal”. That in itself wouldn’t bother me, if I thought that the poorer were better off as an upshot. But the staggering fact is that the poorest are getting poorer. I compiled the below from various editions of the DWP’s “Households Below Average Income” survey:

During the last election campaign, I put this to Tony Blair – and he was baffled. What about the minimum wage, he asked? Bless. The poor soul probably believed Brown’s figures that unemployment had fallen. In fact, the figures for Jobseekers Allowance are dwarfed by other forms of hidden unemployment – the DWP gives a full list here:

Now, last week I asked the DWP to say how many of these people had been on benefits for how long - this means claiming out-of-work benefits (as opposed to tax credits, income supplements etc)". Its openly-available data only goes up to “five years or more”…

...at my request, the DWP kindly broke it down and a staggering 1.1m souls – more than the population of Birmingham, our second city - have been on the benefits for 12 years or more (ie, throughout the Labour years). As far as I know, this information has never been made available before.

These people were bypassed by the economic boom. (The DWP’s welfare reform, which I welcome, has arrived too late). But what about Brown’s claims to have “created three million new jobs?” Well, part of that was pensioners returning to work. Another part was the engorgement of the public sector. Look at the number of jobs in the private sector and split it down by immigration status:

So foreign-born workers account for all of the net job creation since 1997. In this way, economic growth is decoupled from unemployment. The poor get poorer, Britain gets more unequal. To me, the most striking figure of this is those 1.1m – what kind of “progressive” government leaves so many to languish on benefits, while using the boom to double the ratio of immigrant workers? A Labour government was expected to tackle unemployment. Deplorably, Gordon Brown looked the other way.  David Cameron must not.

Filed under: Economy (1023 more articles) , Employment (149 more articles) , Gordon Brown (918 more articles) , Labour (2142 more articles) , Recession (176 more articles) , UK politics (5408 more articles)

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Comments Post comment

Sally Chatterjee

July 10th, 2009 3:41pm Report this comment

Fascinating data Fraser. You're digging up data that the Conservatives don't seem able to find out for themselves! But as interesting as it is, it's also heartbreaking, behind those stats we'll find a lot of misery.

Sadly Brown's economic miracle was a mirage, it was all about debt and wasting the productive energy of the economy chasing illusory returns from speculation. He turned the British economy into a Supercasino.

TrevorsDen

July 10th, 2009 4:07pm Report this comment

Spot on. Our growth over the 11 years under brown has been bogus. A statistical sleight based on unsustainable spending and borrowing and an influx of immigration.

Keep at it Fraser - keep sticking it to Gordon and hit him with it every time. If you ever get another chance to ask him a question that is.
But do not let him or the man holding the microphone bully you into silence. The other hacks of the lobby may be cowards but you shame them with your analysis.

Brown is an abject FAILURE --- a total failure and this is why he cannot never ever tell us the truth.

mart

July 10th, 2009 4:13pm Report this comment

Fraser: Good article, very striking graphs.

Will you devote some time/space soon to describing what is meant by being "on" benefits?

Do you mean to say that the figures here are for people whose sole income is those benefits?

Are there people in these statistics for whom benefits are a top-up?

I do not need to know the answer to this, and that's why I do not know. But I thought it worth asking, since it's rather important when trying to understand what the above graphs mean.

Thanks!

Dirty Euro

July 10th, 2009 4:18pm Report this comment

So the way how we solve this inequality is by electing tories then I see. Who will cut taxes for the rich and cut public services for the poor.
Look when the biggest rise inequality happened in the 80s under Shock Horror Mrs Thatcher. Well what a surprise.

seb

July 10th, 2009 4:28pm Report this comment

Has Reichsleiter Balls been on the phone to you yet, Fraser, demanding you withdraw this post?

Rhoda Klapp

July 10th, 2009 4:45pm Report this comment

Any thoughts on expenditure? How much in benefits have the 1.1 million had? How many really are physically unable to do work of any kind?

JohnOfEnfield

July 10th, 2009 4:46pm Report this comment

Any man of integrity would resign NOW.
All this, as well as trebling or even quadrupling the National Debt.

What a Legacy.

James McLaren

July 10th, 2009 4:54pm Report this comment

Devastating use of statistics and and an annihilation of Labour in general and Brown in particular.

F Bailey

July 10th, 2009 4:56pm Report this comment

Why won't the other parties explain and proclaim these facts? Then, perhaps even the BBC might be forced to tell the world just what's been happening.

Jonathan Cook

July 10th, 2009 4:57pm Report this comment

Wow.

That is dire, dire performance.

Cameron should publish clear graphical dashboard of the countries key objectives when in government. He could use the tool as a lever to justify his position - tax increases, or whatever.

People would gladly accommodate clear, fair and well justified argument. A dashboard would make it obvious.

pharbitis

July 10th, 2009 5:04pm Report this comment

Very well done.
At the risk of sounding v. naive (could be so), are these figures not obtainable by Cameron's crew? So why has he not served his ace with them? He can't be biding his time, surely? His time is now - nails in the coffin and a stake through the heart of this perfidious bunch of socialist trolls.
And how does Gord get away with spouting economic 'inexactitudes' (I prefer the word 'lies' but this a public forum...) week after week?
Don't these figures nail him?

Andy Carpark

July 10th, 2009 5:07pm Report this comment

A myopic shufti at figure 3 of 6 indicates about 2.5 million on Incapacity Benefit. That's about 1 in 12 of the working age population incapable of doing any work. At all. Right?

It would be fascinating to see some comparisons with other EU member states, or better still with countries which only recently invented the safety net or have not yet got around to doing so. But 2.5 million sounds like some kind of joke.

John F in Aberdeen

July 10th, 2009 5:19pm Report this comment

Well done Fraser. At least you are a real investigative journalist.
Other so called journalists like "Nick "Toenails" Robinson and the rest of the Zanulabour supporting BBC, Mirror and Guardian are as bad as North Korean TV.

As for Brown, Blair etc, being put out of power at the next election is too small a price to pay for the incompetence and great damage they have done to our country, They should be prosecuted and punished.
They,re lucky they weren,t around a few centuries because bad leaders were hung drawn and quartered in public,,,I would willingly buy a ticket to see this happen to these Zanulabour thugs at Wembley.

TrevorsDen

July 10th, 2009 5:34pm Report this comment

They tories have pointed these things out - to the general disinterest of the BBC, and indeed to the general public whose minds usually are on many many other different things.

the point about these stats is the use they can be put to in an election campaign when the nation stirs itself every 5 years.

john miller

July 10th, 2009 5:50pm Report this comment

I can't prove this, but circumstantial evidence would seem to prove that this inequality is supporting house prices, which should have fallen by more than they have.

I think that there are a few very rich people out there who are taking advantage of the (relatively small) fall in house prices to buy up swathes of property.

This would mean that under the nasty cruel Thatcher the number of house owners increased, but under the wonderful, equalising socialists, it has decreased.

It would be interesting for the Tories to research this. I think that since house ownership was a vote winner for Thatcher, the reduction under a socialist government could sound a death knell for Labour.

Mind you, since the core socialist voters seem unconcerned that they have been made poorer by Labour, I could be wrong...

Lee Jakeman

July 10th, 2009 5:53pm Report this comment

Doesn't all this illustrate the sheer uselessness of the Conservative Party as an opposition?

oldtimer

July 10th, 2009 6:05pm Report this comment

A good analysis and a depressing outlook for us all.

This link, to conservative home, restates many arguments familiar to those that post here:
http://conservativehome.blogs.com/centreright/2009/07/farewell-to-a-wasted-decade.html#more

Its significance is that it is written by Mark Field MP. It is worrying because he says that too many of his colleagues have not fully recognised the depth of the financial crisis the UK is now in.

Victor NW Kent

July 10th, 2009 6:13pm Report this comment

Dirty Euro - perhaps you would explain your master plan for equality. Does it involve making all equally poor?

Son of Belial

July 10th, 2009 6:16pm Report this comment

Labour depends on the poor for votes, so its not in their interest to make them prosperous. What they need is as many poor people as possible. So that's what they aim for. And that's what they get. You KNOW it makes sense.

mac

July 10th, 2009 6:49pm Report this comment

DES,
DES:

Nah. You must be right. Let's re-elect Brown and Balls. They'll sort Fraser's statistics out in no time. Some thick black marker alterations, turn the graphs upside down and you'll be happy as Larry to buy into 5 years of the Gramscian destruction of Britain.

Has the third moon risen on your special planet yet?

TGF UKIP

July 10th, 2009 7:23pm Report this comment

Brilliant, absolutely brilliant, Fraser, confirming you again as the principal Tory economic spokesman.

Andy Carpark makes an interesting point on how useful comparisons would be to set UK performance into context.

The other point which occurs to me is the one of proportions. In short, what percentage do the 5.2 m on out-of-work benefits comprise of the total "workable" (including self-employed) population and is there an "expert" guestimate of how many of the 5.3m can be genuinely regarded as unable to work.

PS While on matters economic, why are you and your mates, especially your client, so silent on the French/EU attack on the City. With the City comprising 8% of GDP, I would have thought this would be of massive concern to a future government. The City is getting worked up about it, the Business section of the DT as well and even, EVEN, the FT, so why are the Tories and the Coffee House hacks so silent. Or are the Pusillanimous Pair just being the Pusillanimous Pair again, with you lot being reluctant to embarrass them.

James

July 10th, 2009 7:31pm Report this comment

Socialism breeds inequality. Why the shock.

TrevorsDen

July 10th, 2009 7:45pm Report this comment

Lee - a fatuous comment. Do you really think that the issues debated at great length and detail on blogs like these capture the interest of the wide public?

The shattering indictment is that these issues are not discussed by BBC and other TV journalists.

'tories research this research that reserchr the other' - what with? How much money do you think they have? Do all this effort then and then what? No change in the poll results? then what? All political parties have a limited budget and, more importantly even, limited time and opportunities to address the public. Does anybody think these graphs could be used on QT??

mitch

July 10th, 2009 7:46pm Report this comment

Brown is a failure by any metric you care to name, he even got the job without a proper vote.
everywhere you look Britain is broken or broke,nothing works properly and all this after 12yrs of "progressive" politics from a party who are supposed to represent the working folk of this nation.
What we have is a massive natonal debt.
massive personal debt.
2 idiotic wars we cannot win.
A useless education system.
and an NHS actively killing people in pursuit of targets set by morons.
Nulab under blair&brown have ruine this country and it may well be beyond repair,no wonder blair removed the death penalty for the crime of Treason it was simple self preservation.

Hysteria

July 10th, 2009 8:04pm Report this comment

TGF - I have only kust become aware of this EU driven anti-city thing - Very interesting silence from team DC - and I am sure Verity will share with us her explanation of why DC will be silent on this -

paulgilboy

July 10th, 2009 8:04pm Report this comment

Labour cannot create wealth by pursuing a statist agenda. People trapped in their hearlands are state subsidised serfs.
the conservative party must take the initiative and free these people from the bondage that labour have consigned them too.

George Laird

July 10th, 2009 8:15pm Report this comment

Dear All

It is a sad grubby little world for the poor.

No such thing as equality, it is the illusion to trick the poor.

I wonder when riots will start again in this country?

Yours sincerely

George Laird
The Campaign for Human Rights at Glasgow University

Travis Bickle

July 10th, 2009 8:30pm Report this comment

Victor NW Kent

the only way socialism ever makes people equal is to drag them all down to the bottom level (apart from the politicians of course who live like kings).

They never looked the other way, this social engineering and bankrupting the country was always the intention.

Anyway it works, in a sane world who would even bother to look at Dirty Euro's inane drivel, yet he's often the star attraction on forum's all over the internet. Go figure.

Nicholas

July 10th, 2009 8:45pm Report this comment

Dirty Euro's Tory myth is the reason socialists like him keep punishing us all with governments like Brown's. That stubborn, pig ignorant minority who have no time for Brown and Gang but "would never vote Tory". They are the useful idiots who grease Brown's one remaining, wobbling wagon wheel.

They should feel thoroughly ashamed of themselves daring to articulate the twisted logic that 13 very real years of New Labour imposed utter incompetence and misery should be continued because of something imaginary attributed to the Tories.

Short the UK

July 10th, 2009 8:54pm Report this comment

Fraser,

You put the FT (F****** Terrible) to shame.

Thank you for bringing to light what many of us feel.

HFC

July 10th, 2009 9:57pm Report this comment

So Brown's core Labour vote will comprise of around 5.2m non-labouring handout-dependent lemmings each voting for a continuation of the same in perpetuity.

oldrightie

July 10th, 2009 9:58pm Report this comment

Sadly I could have produced those graphs in 1997. Socialism is so lacking in understanding of the human condition as to be criminal.

Red Rag

July 10th, 2009 11:38pm Report this comment

So when Cameron makes all these cuts so all these people lose their jobs and then gives the rich tax cuts....that will reduce the inequality gap and reduce unemployment....ah I see.

hadrian

July 11th, 2009 12:19am Report this comment

As ever, it rather makes a very predictable mockery of Labour and Broon's ridiculous claims they'll 'abolish child poverty' by 2020 or whenver. Truth is there will ALWAYS be poverty and inequality. Christ said it nearly 2000 years ago and little has changed to prove him wrong. Certainly not Broon!!

http://faustiesblog.blogspot.com

July 11th, 2009 12:21am Report this comment

This is seriously good work. Well done!

Hysteria

July 11th, 2009 1:27am Report this comment

what happened to my post?

Anyway to recap - Many points already made but mine would include whether Brown and his fellow travellers on the left are evil, or simply stupid?

How many millions have they condemned to a wasted life? How much creativity and wealth creation is supressed by the socialist dogma?

My concern is that DC (the liklely next guy in) does not get the scale of the problem nor articulate the remedial action required.

Paul

July 11th, 2009 2:22am Report this comment

When you know what the real point of socialism is, then none of this comes as a surprise. The inventors of Socialism hated the Judeo-Christian-Capitalist system, and wanted to replace it forever. Socialism is designed to keep their own ideologues in power forever by destroying meritocracy, crushing society through waste and reducing its level of intelligence.

Orwells 1984 is the guidebook. Labour is IngSoc. I've said it all along.

Kentishnortherner

July 11th, 2009 7:16am Report this comment

Look at what happened in US under Clinton, when he limited social security payments the lazy people suddenly realised that they needed to work like the rest of us and pay taxes, hey presto there are more resources to help the genuine poor and needy.

Moraymint

July 11th, 2009 8:03am Report this comment

Superb analysis Fraser.

Pity it's unlikely to cut much ice at Tory HQ.

In my darkest moments I fear more of the same regardless who gets into Downing Street next yesr.

My 22 year-old daughter (studying physics at a Scottish university) is making active preparations to live and work in Canada. Good move.

The Laughing Cavalier

July 11th, 2009 8:07am Report this comment

When one looks back at the early scribblings of the juevenile Brown and at his support for Labour's 1983 manifesto it is hard to avoid the conclusion that the present state of affairs has been brought about deliberately.

Moraymint

July 11th, 2009 8:28am Report this comment

... and another thing.

If you connect Fraser's brilliant analysis with this excellent piece (http://tinyurl.com/nkbwwr) you have, in a nutshell, the pitiful disaster that has been 12 years of Labour Party economic, political and social incompetence.

We really have never had it so bad in peacetime. I just hope the majority of British people figure all this out before we get to the voting polls ... because we'll never hear it from the political class.

Anastasia Santos

July 11th, 2009 9:35am Report this comment

CREEPNG & CONFUSING USE OF "DISINTEREST" TO MEAN "UNINTEREST"
TrevorsDen, You say
(July 10th, 2009 5:34pm) "They tories have pointed these things out - to the general disinterest of the BBC, and indeed to the general public whose minds usually are on many many other different things."

We all hope for the day BBC will indeed show disinterest, i.e. "impartiality". A plea, therefore, to keep "disinterest" for its primary and original meaning of "impartiality". Maintaining this distinction between "disinterest / disinterested" and "uninterest / uninterested" helps clarity in debate. As important, say, as the distinction between tax evasion and tax avoidance.

Just a reminder that the word consensus means "general agreement" (BBC reporters often get this wrong). Therefore, to say "the general consensus..." is tautologous. But you can have a 'broad' or a 'narrow' consensus. Spread the word.

Lee Jakeman

July 11th, 2009 10:28am Report this comment

TrevorsDen - I wouldn't describe my comment as "fatuous" at all. For months, now, I've been watching the likes of Fraser coming up with good, strong arguments - arguments that could easily be repeated, forcefully, by Cameron and his crew in parliament. There have been plenty of opportunities to make mincemeat of this incompetent Labour administration and the Tories appear to have passed most of them up. I suspect that it's because Cameron really is the new Blair - NuLabour with a light blue cloak. We don't have a conservative party in this country anymore. When they get elected, as they inevitably will, I think they will prove to be as big a disappointment here as Sarkozy has proved to be in France. Of course, I hope I'm wrong - but I doubt it.

Dirty Euro

July 11th, 2009 11:36am Report this comment

Nicholas and MAC go back to the planet uranus.
All the graphs show me is it is time to go back to the politics we had in the 70s.

Rosy

July 11th, 2009 12:10pm Report this comment

Can you explain, Fraser, how Brown increased the tax on the poor by doubling the 10p starting rate? Sorry to be so dim- I want to be able to hold my own in conversation with the Left ! Pleas enlighten me, as a high rate taxpayer who doesn't get these things ! and Thanks in anticipation....

Guy H

July 11th, 2009 3:06pm Report this comment

@ john miller:

There are several things supporting house prices, including Brown's long term policy of squeezing every other store of value. The more taxes on on other forms of savings and investment rose, the more the property boom was stoked. That makes the market inelastic downwards (as well as illiquid). People aren't willing to take even paper losses, because they have no better prospects if they reallocate the funds. They prefer to try to wait out the dip and realise the tax-free gain.

Nick Kaplan

July 11th, 2009 4:49pm Report this comment

Blair’s apparent ignorance of basic economics (suggested by his comment ‘what about the minimum wage') is astounding for a former PM. Milton Friedman argued for years that a minimum wage would make the very poorest (least productive) worse off to the advantage of politicians. It is an obvious economic reality that if someone can only produce £5.00 an hour and the law requires that that person be paid £5.50 an hour (or whatever the minimum wage actually is) then instead of the law increasing that person’s wages by 50p an hour they will simply loose their job; why employ anyone at a higher cost then they are capable of producing? You’d loose money on each person you employed. Politicians however benefit because the public is prone to credit politicians for their stated intentions (in this case to help the poor) without paying due attention to the actual results. But how genuine can the intentions of someone be if they have such a cavalier attitude to the actual outcomes of their policies??

Dirty Euro; Under Thatcher inequality increased, but the poorest were better off when she left office than they were when she entered, so what is the problem?? There is nothing wrong with inequality per se, it is a neutral symptom of a process which is either good or bad. Inequality will increase if both the rich and the poor get richer (a good thing) but the rich do so faster, or if the poor get poorer while others stay the same (a bad thing). The thing Labour should be ashamed of is not inequality (why would anyone care about inequality in itself????) but the fact that the poorest are now worse off than they were previously.

griff

July 12th, 2009 6:41am Report this comment

Fraser, does Polly Toynbee read your articles?

Dr Blue

July 12th, 2009 8:30pm Report this comment

http://www.bmj.com/cgi/content/full/338/jun30_3/b2604

Good article Mr Nelson. The link above takes you to Nigel Hawkes's demolition of Labour's claim to have done anything useful about health inequalities.

It's great "caring about equality" but it's clear that centralised tax rising monopolies such as governments lead to great inequalities at great cost.

The answer to most problems of inequality lie in education and work opportunities- not in government action.

Fraser Nelson

July 13th, 2009 3:23am Report this comment

Dr Blue, it's subscription only, sadly - but a v strong topic. I'll see if I can get a copy somehow and return to this theme later.

Griff, I doubt it - but I'm debating her on Thursday at the IPPR so I'll see.

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