The (distorted) issue of inequality

Stephen Buzdugan  - Senior Lecturer in International Political Economy, Manchester Metropolitan University

Yet Boston is also one of the areas with the highest levels of economic deprivation in the country. This suggests that economic factors may not therefore be able to be explained away so easily. Indeed, Branko Milanovic made this point very nicely in a recent tweet, noting that the timing of Brexit and Trump seemed to coincide with the onset of the global financial crisis and the precipitous decline in wealth between relatively poor households (the 25th percentile) and the ‘squeezed middle’ (the 50th percentile), leaving this group 6 per cent worse off than they were in 1989.

The second problem is that income inequality in Kaufmann’s post is captured too crudely by reference to levels of income and social grade. The implicit assumption in framing the analysis this way is that, if income inequality should factor significantly into individual choices about whether or not to vote ‘Leave’ or vote ‘Trump’, then those on the lower or lowest ends of the income scale (the ’have nots’) would have been most inclined to support a populist right agenda — which Kaufmann shows was not the case. However, comparing support between the rich and the poor is not the same as capturing attitudes toward inequality across the electorate.  Kaufmann attempts to remedy this by showing that the strongest supporters of Brexit and Trump in his survey indicated that the issue of immigration was of much greater concern to them than inequality.

However, are the issues of inequality and immigration all that separate? How might inequality be at the heart of concerns about immigration amongst these supporters, given that it is difficult to find even one speech by Boris Johnson, Nigel Farage or Donald Trump that even mentioned the word ‘inequality’?

Two recent works offer some powerful clues to help respond to this question. The first clue is found in the work of Duke University economist Dan Ariely, who shows how poorly people in the US estimate the incredible levels of inequality at the national level.  In an article in The Atlantic, Ariely presents the striking finding that, on average, Americans wrongly estimated that the bottom 40 per cent of the population controlled about 9 per cent of total wealth and that the top 20 per cent controlled about 59 per cent of all wealth.  Actually, the bottom 40 per cent possess only 0.3 per cent of wealth, while the top 20 per cent possess 84 per cent!

But Americans are not only unaware of the severity of the problem of inequality. Ariely also shows how they want a very similar, very egalitarian, distribution of wealth and income across the country regardless of their political party affiliation, income and gender — with even right-wing Republicans preferring a more egalitarian distribution than found in Sweden.

What, then, might account for the different political choices made by Democrats and Republicans, or, in this case, those who voted for Trump or not? Ariely puts forward a possible explanation:

Another reason could be politicians, who, in order to rally people to their side, try to generate feelings of greater difference and opposition – and therefore conflict – than actually exist. From this perspective one could claim that politicians obfuscate similarities by using galvanizing but elusive terms like ‘small government,’ ‘tax relief,’ and ‘freedom’.

One of the defining characteristics of both the ‘Leave’ and the Trump campaigns was their focus on immigrants from poorer countries, on attacking minorities and on nationalist slogans such putting Britain or America, respectively, ‘first’.

In this regard, Berkeley sociologist Arlie Russell Hochschild’s recent book Strangers in Their Own Land: Anger and Mourning on the American Right offers the second powerful clue to the role that inequality played in the Trump election, linking strongly to Ariely’s findings above.  The main argument of her book is summarised in this article in The New Yorker:

Hochschild noticed that Tea Party enthusiasts and traditional conservatives gave her accounts of American society that boiled down to a single ‘deep story’. This story was that America, which was once characterized by hard work, was now characterized by cheating; the image that Hochschild chose was that of people cutting in line. For Hochschild’s subjects, the line-cutters were African-Americans, promoted by affirmative action, she writes, but also ‘women, immigrants, refugees, public-sector workers—where will it end? Your money is running through a liberal sympathy sieve you don’t control or agree with.’ President Obama, in this vision, was the man controlling the line, waving the line-cutters ahead – ‘their president, not your president’.

The issues underlying in this statement are fairness and economic inequality. However, the Trump campaign, and indeed the Brexit campaign too, was successful in diverting attention from the broader and more serious problem of income inequality between the upper quintile of the distribution and the rest to a more focused concern that honed in hard on income inequality amongst groups below the very richest – and then associating this with race and identity!

All of this poses a grave challenge to more progressive political movements in the US, the UK and other parts of the world that have experienced soaring levels of inequality because of global neoliberalism, and yet have become vulnerable to the populist right. It is to recognise and fully take on board the complicated ways in which the debate on inequality has been distorted into a debate about race, identity and immigration, and then turn the attention of voters back to the more acute problem of income and wealth inequality and forward towards projects of ‘re-globalisation’ and more inclusive growth.