Gulf between UK rich and poor and does anyone speak for the poor anymore?

The generally widening gap between the rich and the poor (the haves and the have nothings) in the UK has been a worrying issue for many years now, but just take a moment to read the document accessible via the link below from the Institute for Fiscal Studies:-

www.ifs.org.uk/publications/9539

I think you’ll agree that this is a matter which is deeply worrying and one that is seemingly out of control; its a gulf between the richest and poorest in our society not a gap. And no amount of comforting ourselves by be being mid-range in the international comparators of such matters is any good either as we complacently slip further down the league.

Soon after I read the IFS report (and actually by coincidence) I also became aware of a very recent report from the Rowntree Trust which raises concerns about the poorest in our society increasingly feeling that no political party speaks for them any more. This has been an issue on my mind for a long time now.

Yes, of course Labour traditionally spoke for the poor but I bet I’m not the only one who has gained the impression in recent years that this is something it would rather not do any longer. Under Miliband we started to hear his people saying things along the lines of ‘we represent working people’, whilst they joined in the Tory attack on those needing to rely on welfare/benefits. And the line has not really changed much under Corbyn as significantly Labour did not pledge to reverse many of the working-age Conservative welfare cuts at the last election. What’s more Labour is fully behind Brexit and it’s the poor who will suffer the most from that act of national madness.

Of course the reason politicians don’t really want to represent the poorest in our society is that often the poor don’t actually vote. The cynical political managers and strategists, who of course run our political parties, simply point this out to those seeking high office and the effect is clear. The politicians then either ignore the poor or even attack them for relying on welfare because that’s a message the tax paying people who do vote have been trained to want to hear.

My own party has a preamble to its constitution which says this:-

The Liberal Democrats exist to build and safeguard a fair, free and open society, in which we seek to balance the fundamental values of liberty, equality and community, and in which no one shall be enslaved by poverty, ignorance or conformity.

Unsurprisingly as a Liberal I agree with the statement but can the Lib Dems hand on heart really say that campaigning to improve the lot of people being ‘enslaved by poverty’ has been a top priority in recent times? Having said that Tim Farron the last Lib Dem Leader clearly did get it to give him his due.

Yes we went into the last election pledging to address poverty and the causes of it and our pledges probably went further than Labour’s, but should we not have gone further again? The Lib Dems said they would reverse cuts to child tax credit and the plan to freeze most benefit rates for example but despite railing against Tory welfare cuts over the years, Labour did not plan to reverse most planned cuts to working-age benefits.

But, few of the poor voted for what the Lib Dems were proposing, even though to have done so may have been to their advantage from what was on offer across the political parties. Then again they probably didn’t vote for any of the main political parties, if indeed they even voted at all.

Yes I know this latter argument virtually justifies the positioning of the political managers but it is still a sad reflection on our broken society in my view.

So we have a society where the rich have become bloated whilst the poor have to keep tightening their belts. What’s more we have an underclass of poor people whom the major political parties have all but abandoned. Could you think of a greater reason for us to be concerned about civil unrest never mind that we should be utterly ashamed of the state we are in.

By the way the objective of many politicians is to keep those in the middle on side because if they get upset politicians lose seats. So if our economy is being run to keep those in the middle and above happy you also have to feed that large group propaganda to ensure they resent welfare payments to the poor and the press step in to provide that propaganda of course.

Oh and as a slight aside, with talk of a rise in interest rates just think who will benefit from that. It certainly will not be the poor so take a look at this piece in the Guardian from Polly

www.theguardian.com/commentisfree/2017/oct/31/taxes-interest-rates-mark-carney

With thanks to Roy Connell for his contribution to this posting.

Household Debt!

www.bbc.co.uk/news/education-38370219

This is probably one of the biggest financial problems facing the UK because at some point our financial systems will recover and interest rates will start to rise. On that basis what will happen to those who are in debt up to their arm pits and have incorrectly assumed that historically minute interest rates are the norm and that they will be in the future.

Some people will sadly be ruined.

With thanks to story spotter Roy Connell

Interest rate rise effect on mortgages – This could be the biggest threat to economic recovery

Radical steps needed to avoid thousands of repossessions

Radical steps are required to ensure that the homes of hundreds of thousands of Britons are not at risk of repossession when the Bank of the England begins increasing interest rates, according to the Resolution Foundation. The foundation has proposed that the Government sets up a scheme to help people avoid losing their homes by making a “soft exit” from the market. One option suggested would be to allow owners to “trade down” to shared ownership, in which a state-funded registered provider would buy a stake in the property, leaving the borrower to pay a smaller mortgage and subsidised rent on the share of the home they no longer owned.

The low level of interest rates, since the economic collapse, must have led to some mortgage holders over stretching themselves and potentially unable to cope when the financial markets re-balance themselves and interests rates rise. Interest rates have to start to rise soon and I fear there will be victims of it who did not, on taking out their loan, think ‘can I still afford this mortgage when interest rates rise?’. The ideas put forward by Resolution Foundation to help those who find themselves trapped by rising interest rates need to be seriously looked at.

Thanks to the LGiU for the lead to this article