The importance of the labour movement in tackling inequality

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The following comes from the web site of the Class Think Tank, of whose advisory board I am a member:

The importance of the labour movement in tackling inequality

Professor Richard Wilkinson and Professor Kate Pickett 

Drawing on a range of evidence, this short Think Piece looks at the role of the labour movement in achieving a more equal society. Our own research, and that of many other researchers around the world, shows that almost all the health and social problems which tend to be more common lower down the social ladder also tend to be worse in societies with higher levels of inequality.

The widening gap between the incomes of the richest and the poorest are primarily a reflection of a tendency for top incomes to grow faster than incomes throughout the rest of society. This widening gap seems, in the absence of strong trade unions and an effective labour movement, to reflect a lack of any effective democratic constraint on top incomes. If that is so, then part of the solution is to build effective constraints by extending democracy into our economic institutions.

Some of the more equal societies gain their greater equality by redistribution, but others start out with smaller differences in pre-tax incomes. A more fundamental approach to reducing inequality is needed to reduce differences in people’s incomes before tax. This paper shows that the weakening of the labour movement during the last quarter of the 20th Century has had a significant impact on the ability of working people to influence their standard of living and quality of life.

This paper argues that we must now recreate a movement with the political and social influence that enabled the former labour movement to achieve the major reductions in inequality during the middle decades of the 20th Century. A fairer and more sustainable future is possible.