Super-riches don’t ‘trickle down’, they ‘hoover up’
Are people bothered about the huge gap between the super-rich and everyone else? There is some scepticism about this.
When the British Social Attitudes Survey asks if people support redistribution of wealth from rich to poor, opinion is more or less evenly divided. Support for the Government’s welfare cuts perhaps implies that the public will not unconditionally back measures designed, in part, to provide some limit to the gap between top and bottom.
Conversely, when the question considers inequality as a social problem, rather than identifying a possible solution (ie redistribution via Government) the response is much stronger. Polling for the High Pay Commissions found that 73% of the population agree with the proposition that differences in income in Britain are too large. Just 8% disagree.
The problem with both arguments is that they start from the assumption that the public broadly understand the scale of the nation’s wealth controlled by the rich. As the new video from the Inequality Briefing shows, this is not the case.
Polling by Ipsos Mori shows that the public’s perception of how wealth is distributed in the UK seriously understates the gap between the richest and poorest 20 per cent.
Respondents felt that in an ideal world, the top and bottom fifth would have about 27% and 15% of the nation’s wealth respectively, but in modern Britain they estimated the breakdown was more like 42% to 9%.
In actual fact, the figures are more like 62% to 0.6%. The richest 1% control more wealth than the bottom 60%.
This has significant implications for the debate about the cost of the super-rich. The huge gap between their own wealth and that of everyone else makes it look like less a case of ‘trickle down’ , where spending on part of the rich benefits the rest of the population, than ‘hoover up’, with those at the top using their power and money to grab an ever increasing slice of the nation’s wealth at the expense of everyone else.
The video also presents a problem for those such as Boris Johnson who has repeatedly called for an end to the antipathy towards bankers. Though we are now five years on from the banking collapse, public resentment towards bankers and other members of the richest 1% actually underestimated the extent of their self-enrichment!
(Luke Hildyard is head of research at the High Pay Centre – an independent think tank examining issues of top pay and corporate governance. They are hosting a debate on the impact of corporations on the North East economy this week in Newcastle)
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