In the opening months of the year, the
political issues are coming at us thick and fast. Standards in schools, what to do about crime, tax reform,
improving our economic performance, meeting Maori interests, have all crowded their way on to the political agenda.
The government has addressed each of these, one
by one. National standards in primary schools will, we are told, improve the life chances of those who
are currently being left behind. “Three strikes and you’re out” will reduce violent crime.
A shift from direct to indirect taxation will transfer resources from consumption to investment. A
renewed emphasis on economic growth will close the gap with Australia. And the Maori Party’s agreement
with the government will help to advance specifically Maori interests.
There may be merit in each of these responses. But what if they all miss the real
point? What if there is an underlying factor that unites all of these issues? And what
if overlooking that factor means that the specifically targeted responses to each individual issue are less likely to be effective?
It can be argued that there is such an underlying
and unifying factor – one that does not necessarily explain every dimension of these pressing issues or offer a comprehensive
solution to the problems but that – if ignored – will make an effective response unnecessarily difficult.
That issue is the growing inequality that has disfigured our society in recent decades.
Each of the specific issues is, after all, a consequence or
an expression of that inequality. Both the 20% of students who are said to be let down by our education
system and those misfits who are filling up our overcrowded jails come overwhelmingly from the economically disadvantaged
in our society – and the former group are all too likely to migrate eventually into the second group.
The tax concessions for the better off are linked
to the drive for economic growth, and both are linked to the “trickle-down” theory that the poor will eventually
benefit if the rich get significantly richer – a theory whose implementation has done so much to widen the gap between
rich and poor in our country. And the Maori struggle for a fairer share of national wealth is – at
least in some senses – a crusade by and for the dispossessed and disadvantaged in our society.
To make these links between inequality and the problems confronting
New Zealand today is more than mere speculation. In a ground-breaking piece of research, the authors
of a study called The Spirit Level* have established that in countries where inequality has increased most sharply
– countries like the US and the UK – there is also the most damaging rise in social problems like crime, drugs,
early pregnancy, and gambling, and – even more significantly – the most significant impairment of the physical
and mental health of the population. It is of course very obvious that these are also the same countries
whose failing financial systems precipitated the global recession.
In countries where equality is much more evident – countries like Japan and the Scandinavian
countries – the record on social ills is much better. The researchers are able to show that the statistical
correlation between inequality and social dysfunction is too sustained, over time and place, to be accidental.
Where does New Zealand stand in such an assessment?
From having been one of the most equal societies in the developed world, over the last 25 years New Zealand has progressed
(if that is the right word) towards inequality faster than almost any other country. So, if the research
is to be believed, we should not be surprised if we now exhibit the same difficulties as afflict other unequal societies.
The research shows that the steeper the income
inequality ladder, the harder it is to climb, and the slower and more difficult social mobility becomes. At
the same time, greater equality improves the quality of life for everyone and not just the poor. Even the
wealthy will enjoy life more in an integrated and whole society. People across the board will live longer
and will be less likely to suffer violence or have a problem with obesity; their children will have a better chance of doing
well at school and will be less likely to use drugs or become teenage parents.
Our best chance, in other words, of giving children – Maori and pakeha -a better chance at school,
or of keeping them out of jail, is to reduce income inequality. Our best chance of improving national economic
performance is to focus on improving the education and health of the whole population so that everyone can make a full contribution.
Conversely, to allow or encourage the income
gap to widen is seriously to prejudice the chances of dealing successfully with current problems, and to risk making future
problems worse. As we look to the current range of responses, from national standards in education to re-balancing
the tax system, we must hope that our political masters understand this simple truth. It would be a tragedy
if the measures directed at specific issues make the underlying problem worse.
*The Spirit Level: Why More Equal Societies Almost Always Do Better, by Richard Wilkinson and Kate
12 February 2010