Alastair Heath has recently drawn attention to the collapse in net income of the top earners in the UK under the Coalition. The top 1% took home 11.2% of the nation’s net income under unequal Labour in 2009-10, and a much lower 7% this year under the much more equal Coalition. This fall goes all the way down through the top half of earners. The top 50% received 75% of total net income in 2009-10, and only 60% this year. Meanwhile the bottom half receives a bigger share of the income than at any time this century.
All those who wanted a more equal society should rejoice. Indeed, they should be voting for Coalition parties out of gratitude. The Coalition has done something Labour was quite unable to do during its period in office, when the UK became less equal.
Not everyone, however, is rejoicing. Getting inequality down by moving rich people offshore or out of the country altogether is no great success. It is easy making the top half of earners worse off, but doing so does not help the economy to improve, grow, change for the better. We need economic growth to raise all living standards. We need more jobs to rauise the living standards of those currently living on benefits.