Inequality 'costs Britain £39bn a year'

[malaise]

http://www.theguardian.com/society/2014/mar/16/inequality-costs-uk-billions
<snip>

The ever-increasing gulf between rich and poor in Britain is costing the economy more than £39bn a year, according to a report by the Equality Trust thinktank. The effects of inequality can be measured in financial terms through its impact on health, wellbeing and crime rates, according to statisticians at the independent campaign group.

Researchers pointed to the fact that the 100 wealthiest people in the UK have as much money as the poorest 18 million – 30% of all people – and said that the consequences of such unusually high rates of inequality needed to be acknowledged by politicians.

Duncan Exley, the trust's chief executive, said economists in the US had begun taking the issue seriously but that the UK was behind the curve in understanding the full extent of the harm that could be caused by inequality. "But people are starting to talk about the gap between rich and poor as we are seeing such a chasm now. Not only are wages stagnating and austerity hitting the poor hardest but the rising stock market and soaraway rates of top pay are rocketing in the other direction."

The research finds that some of the social consequences of inequality could be worked out by calculating reduced life expectancy, poorer mental health and higher levels of crime. The £39bn is equivalent to the government's yearly spending on defence, according to the report, The Cost of Inequality.

[xchrom]

1. du rec.

[starroute]

2. Inefficiant allocation of resources, impediments to innovation ...

Not to mention the idea that elites who only interact with one another and never go near the common people and their problems become seriously unable to identify or deal with looming crises.

It begins to seem that downward redistribution is an absolute necessity for the survival of society -- and that giving free money to poor people is a less expensive way to manage that than any elaborate, means-tested system that seeks only to reward the worthy.

[Donald Ian Rankin]

3. The thing to remember about this number is that it's essentially made up out of thin air.

They've taken some arbitrary things, added them together, and said "this is the cost of inequality". It makes for a good headline, but it doesn't actually mean anything.