Ross Clark

Levelling up is Johnsonian cakeism

A Pareto party is an excuse for avoiding hard choices

Levelling up is Johnsonian cakeism
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Until this morning, few people in Britain will have heard of the works of Wilfredo Pareto (1848-1923). Now, thanks to prime ministerial recommendation, his name is suddenly on everyone’s lips. Maybe he was even the inspiration for the name of Boris Johnson’s one-year-old son.

But was it good idea to raise the memory of the Italian economist and political philosopher? Pareto, apparently, is the inspiration behind the whole idea of ‘levelling up’. The slogan, implied the PM, is derived from the concept of ‘Pareto Improvements’ — improvements, he said, which can raise the quality of one person’s existence without afflicting the wellbeing of another. Johnson is saying, in other words, that public policy is not a zero-sum game. We can all get wealthier at the same time. We can, to put it in another Johnsonian way, have our cake and eat it.

You can see the general truth of this in the increase in global wealth in the era of capitalism. Much as Marxists would like to argue otherwise, and claim that the wealth of a few has been built on the backs of the many, virtually everyone in modern Britain is better off than their counterparts in Victorian Britain. Yet there are many government policies that cannot be said to be Pareto improvements. The recent change in social care policy, funded by a rise in National Insurance, is a case in point. It will certainly make one group of the population better off — people who stand to inherit property from their wealthy, care home-ridden parents. But there are obvious losers, too — namely those who work for a living, do not stand to inherit property and who must now pay more tax to fund a policy from which they stand to gain no benefit.

There is another risk to raising the memory of Wilfredo Pareto. He is better known for the Pareto Principle, which holds that inputs to and outputs from an economic system can be very unequal — often at a ratio of 80 to 20. For example, you might find in a business that 20 per cent of the staff are responsible for 80 per cent of the production. It was inspired by Pareto’s observation that 80 percent of the agricultural land in 19th century Italy was owned by 20 per cent of the population.

With rising property prices — not to mention reforms to the care system — helping to concentrate property wealth in Britain into ever fewer hands, this is an observation, perhaps, which is more useful to the Labour party than to the Conservatives. The Prime Minister may end up wishing he had allowed Pareto to reside in what he called the 'cobwebbed attic of his memories'.

Written byRoss Clark

Ross Clark is a leader writer and columnist who, besides three decades with The Spectator, has written for the Daily Telegraph, Daily Mail and several other newspapers. His satirical climate change novel, The Denial, is published by Lume Books.