How does the UK break down these days into those who are satisfied their lot as adults of working age ? That is to say with their income relative to outgoings, their work-life balance and their prospects for things like personal fulfillment and family fortunes?
Going by a mixture of voting statistics over the years and pure wetted=thumb-in-the-air, I would say there is a three way split. This is not actually directly relational to over all household income or net wealth, but follows that bell curve quite well in general. We could deduce that a third of society are thoroughly discontented, a third of society are very happy thank you while a third of society encompass those who would like to be in the top third, but are frustrated in their efforts or not quite wealthy enough yet.
The happy-thank-you is not mutually exclusive to low income or those who are just breaking even. Rather the opposite, some folk who can just about cut their cloth to suit their form, are content or in ignorant bliss. Yes many of the super rich are in there, but of course many just want to get richer and are paranoid about labour getting better off at their expense.
Happy with their lotters probably correspond with the low turn out for voting, until you put the Scottish Independence Referendum in front of them in Terrra Caledonia that is, when they are moved to keep the status quo ( like status quo the group, a worn out series of releases which are outdated and gathering dust while a new generation seek indy) Or those in wealth or high position vote Tory to keep the old inverse Robin Hood government in power, and let the capitalist system keep on feeding them at the top at the expense of those at the bottom.
Those Wee Davey Cameron is really interested in is the middle lot who are aspiring. For that we can understand that it is of those people "who want to work hard and get on" who feel that they can best achieve growth in personal wealth by a combination of lower personal taxes and higher house prices. The New RIght had almost succeeded in ridding the country of the idea that Unions or politicians can deliver things like pay rises linked to inflation and not subjective productivity and bonuses based on financial performance of the whole corporate which never quite see the light of day or are piddling litte , a night at a Travel Lodge for the average family. Or other things like mandatory overtime and anti social hours which politicians delivered, or a large public sector rental market which kept the heat off the housing market and helped middle class junior get their first starter flat before they were middle aged as the case will be now.
Such terrible, terrible things too as rent caps and higher rates on second properties are things which arent wanted by the top third because they have long since discovered that bricks and mortar in a land which does not allow too many new homes to be built, means a levered multiplier which is inflation proof and has survived even this 8 year slow down intact.
What they want you to think the Tories, is that your tax money is being wasted and the best way to personal family income growth is through tax cuts, not sordid union negotiations with employers, oh no. It's always easy to find some council or department or quango who are misusing money, but it is increasingly easy to find disabled people who are having a poorer quality of life due to 'austerity' and what the merchant bankers did to us all. The Blue Meanies roll out more austerity and further tax cuts to the rich, plus a nice 10% pay rise to politicians. This all to stimulate the economy and make it more attractive to invest in Britain.
The Tories have lived off this mislead middle third for many years, with the top up to the solid vote in their heart lands and the swing vote in the midlands coming from the aspirants who basically have become snobs and hope to be rich enough soon to fund their klids through private schools and universities and help them buy their first flat. They have been able to lever enough seats on only 37%-43% of the national vote for decades. They have captured a wandering ten percent of the vote, and relied on the lib dems to split the opposition vote. Only the tories and that ten percent too are locked into the law of averages.
Average income, average pay growth and average house prices and average house price growth. By some level of default, these asipirant peoples are at around average income when single, in the band 22 /33 (by standard deviation guesstimate) thousand a year, and in the family income of around 40 - 50 k per year, They are no longer the biggest tax cash cow as the rate for higher tax is up, and tax for the first third is removed. Most of them certainly cant rely on a Union negotiating them a pay rise, and are more linked to the career ladder, capital gains on houses and the promise of tax cuts.
There are also within this section many self employed folk, who often fall into being staunch Tory supporters and like having cheap, disposable staff in the new zero-hours, super flexible labour market which damns so many to renting and insecurity. Many of them though feel the breath of the inland revenue and pay their taxes dutifully, while they see trillion pound corporates export their profits and pay a paltry amount of their turn over. Think of the local coffee shop versus star bucks, or the local internet directory versus google. The small staffing agency versus Adecco. The small plumber versus the emerging super pipe bender firms which are emerging. All the time this, and the decline in their customers discretionary income as wages for below average workers stagnate, while the cost of living mysteriously feels a lot higher than the RPI.
My generation, the baby boomers first babies or the war brides second brood, are the first who on average will have a lower standard of living and quite possibly a poorer quality of life than our parents did through working age (which is why I do not live in the UK anymore BTW) We will have less material wealth, all be that at a higher price, we will have longer working hours, we will have slower pay growth and we will work until we are older and many will have to work part time as pensioners in order to have those little luxuries through their 70s.
We have bought our first house age 37 versus a decade earlier for our parents. In part this reflects of course womens careers, but it is a damning indictment on 'a home owning people's democracy' when the majority of us have lived in other peoples houses for the first half of our working lives. This trend, as many of those above, will continue if poltics do not change. Our children will have older parents who need to use more of their capital to pay for themselves in old age. When will they on average be buying a first apartment? age 43? Age 45? Dont forget that the first standard deviation will be buying (like me actually) now into their forties and soon into their fifties with only a decade and a half to pay off the mortgage or have enouggh capital gain to come out even?
Also if we do not stop the trends with how employers treat us and expect us to behave, our children will work even longer for relatively less money in relation to the cost of housing in particular. Internships and work-practice are now becoming an insidious norm in many higher value industries and this will inevitably creep down into all echelons of society as employers simply can demand it because most people expect to do it and the law says nothign against it. This is another force which works against employees and leads to more ageism. As more youth work for free and then grab paid employment at lower rates to pay back that extra year (god help us maybe more( of work experience sans income, ) then they become more attractive than any ageing employees who are seen as less productive, wanting to get home to their families before bedtime and such uneconomic, anti competitive socialist desires. They will be more easy to sack, or more easy to employ on temporary contracts as this becomes the norm across all sectors where labour supply out strips demand.
People have to re-appraise what Capitalism actually does for the individual, and that it failed in the past to provide for the majority of families from cradle to grave. The inevitable extreme of market forces in a society hurtling towards a tertiary, service dominated economy is that you end up paying to go to work, and that is no joking matter. You pay now to get into work through those months or year as an intern. You pay now by having work in areas where rents are high or rail commuting is ridiculously expensive. More and more of your income goes to capitalists you didnt vote for and have no control over. This is the same set of economics which evolved in the industrial capital age which led inexorably to the rise of organised labour and the movements of both communism, democratic socialism and the milder liberal social democractic centre position post war.
Amongst the aspirants, there are then a lot of baby boomers who now see darkness at the end of the tunnel as they enter their 60s and realise that they arent going to get any better off as employees, and as self employed business people, it is likely that their lot in or out of the EU will not get that much better under austerity (outside the south of England). Then there are the baby boomers off spring born really in the 1970s and early 80s who are nearing forty, half way into their adult careers and realise they are never going to be as materially well off, or have as much leisure time as their parents. Where as the baby boomers enjoyed unionised work places and high wages in the public sector, their offspring are subjected to pay freezes, down sizing, unpaid over time and under employment in part time or non vocationally relevant jobs. Where as the baby boomers enjoyed a free college education and came out into a good labour market for their rare skills, and an honours degree in anything was a sign of endeavour, the current generation entering middle age have struggled outside the main professions to get a foothold in the market.
Then there are a lot of happy-with-their-lotters who have had it good, not been interested in politics and got by or thrived and tended to vote Tory to be on the safe side. Many of them in the public sector now will be under threat of unemployment or being out sourced or both. Many in manufacturing will be hit by the next round of 'fuck it, lets locate in China' even if their UK based, high tech companies are making profit, the margins will be higher in the peopl'es socialiist republic and the new growth market domestic. Bathed in small, weak government propoganda and unions-made-a-laughing-stock-of-us-in 1978 rhetoric, they still dont see that they can achieve a better standard of living through politics and organised labour.
Back then to looking at Capitalism and how by its own mechanisms, it can only provide from cradle to grave for those who rob enough from other people's living, breathing, waking hours of labour. Capital has organised itself well against organised labour, and tried to break the back of it in most western countries and most all developing countries. It is just out with living memory now, when police in the USA and nazi militia in germany gunned down trade union demonstrations with sub machine guns. Yes, people died for the right for organised labour to grab too much power and become a corrupt parody which bankrupted companies and put national budgets into inbalance. But now capital is able to move and organise where it wants to, exporting profits away from the tax man from wealth extraction countries like the UK, and buying production labour where it is cheapest and least bothered by human rights.
The squeeze is tangible, particularly on the white collar new workers who range from the lowliest of call centre operatives up to some highly educated city executives. As an employee you are either made more and more into a commodity by the supply from Universities, or you are treated more and more like an expendible commodity rather than a resource, because that is the lowest common denominator, That is how low capitalism can go in reducing costs and reducing the risk of having too many employees on its bank roll, with too high a cost of sacking when the new financial year or even quarter comes.
The Tories and the New Right across western countries are still able to of course rely on Organised Captial to help them and they are part and parcel of it, while they can buy the share of voice in the traditional medias for now, and social media soon, in order to get their anti left propaganda across. Coupled to this are all the moral issue but also the aspirant appeal, the American Dream, where the promise of lower taxes and higher property values. This is a linked leverage. In the old days of wage rises, a 1 % rate rise in wages lead to a 3% rise in property value because the average worker could lever three times single income. Now people can lever 5 times family income given they have some seed capital, so a 2% tax cut and a measly sub RPI 1% pay rise, can lead to a 9% rise in property value. Rentals are even better because people without capital or with wages lower than entry level property in a metropolitan area, can pay a far higher portion of their income than owners have to. More well heeled middle to older age workers can move into property and use their time managing flats for rental, with the ability to pay capital and release gains into further investment. Surgeons, dentists and engineers just give up sweating all day for a living and buy a chain of flats in former slum areas, move out the slum tennants, a lick of paint and some chinese white wares and now it is 'what the market will bare' with the Google Bus or walking distance to the Tube in the former ghetto.
Of course there was a time when I wanted to be one of those well heeled new gentry, but I qualified about three years too late with all and sundry of masters graduates to compete with, rather than a feather in my cap, I was over qualified for the positiion in the ladder I had come on. So really I have rationalised away my mediocre income relative to responsibility and hours travelling or writing meeting reports or strategies, and pissed off abroad where I can work an 8 hour day and no one bats an eyelid, plus I get over time or time in lieu if I work more. Of course all those niceties are under threat across Europe, Canada and Australia now too as we are asked to compete.
Compete with what? We are primary-tertiary economies with a thin layer of high tech which is only there because of government spending on medicare, pharma and defence. On the primary side, we see how Aus , Canada, Norway and the UK are hit by slumps in prices and demand. However there will be uptimes too, where commodities like oil are economic to extract and no one cares if workers make a decent living out of them again. The tertiary economy then, just what are we competing with ?
In the service economy you have many sub sectors where you just cannot really deliver from a lower cost country. Energy for example. Despite new interconnectors, the majority of energy in most EU/EEA countries is produced and consumed domestically. Interconnectors just have capacity for selling the excess energy when prices are high. Think of this, you cannot sell a burger to a hungry man in Birmingham from Shanghai. There are many more complex consumer and business to business transactions which cannot happen elsewhere, and despite tourism and the internet, a large amount of money circulates within national or regional economies due to physical and cultural ring fences. However these industries are those with the lowest wages and worst working conditions where profits are very often most exported. These are the industries most used to part time labour, avoiding any over time, using zero hours contracts and sacking people at time served or age related thresholds for higher 'on costs'.
We are living in tertiary economies where there is an illusion of the need to compete globally and the propaganda in the media against the ills of unionisation and stronger labour laws which favour full time work, permanent contracts and wages people can live on as active and aspirant members of society with. Taxation is the big stick to hit the electorate with, with the wasteful left wing bearing the brunt while pharma companies extract huge prices for new chronic treatments, while neglecting to invest in new life saving antibiotics. Increasingly, the government pays for the secondary economy, manufacturing and construction, while allowing it too to offer poorer and poorer pay and conditions to workers, relative to the real cost of living.
Capitalism is the only economic system so far which has worked for more than five years in a row, and many capitalist enterprises have failed such as the UK railways before the big 4 monopolisation act. The canals before that. Marconni after all this. The various internet bubble companies. Clive Sinclair, Rover Cars. Woolworths. When capitalism organises itself and then organises government and media to its own ends, then in fact fewer people are taken cradle to grave in a degree of security related to working effort. More people are locked out of being house owners. Fewer people have access to healthcare. Most of all, fewer people actually have ability to earn more money in relation to the cost of living, even when they are self employed. Capitalism accumulates wealth upwards into those who own more at the expense of those who sell their labour, that is an inavoidable truism which Marx, Thacher, Clement Atlee and Donald Trump can agree on. It has found the leverage mechanism to keep that thin third layer in the middle happy most of the time by tax cuts levered to the property market, but now in the west capital is looking to a future where far fewer people own homes and far more are dependent on capiital to provide for them.
In then a bizarre through-the-looking-glass paradox, capitalism offers to be a system to bet on from your cradle to your grave, which will reward your hard work with material gains only that they will be rented to you and provided by nanny capitalism. This view then goes further to mirror the failures of socialism, because increasingly capitalism needs more and more of your income and denies you more and more discretionary spending in order to feed itself as a system of greed and actually build those houses you will rent. It goes so far as of course needing to locate businesses in areas to increase demand for rented property, a planned economy as we see with co-investment in the USA. Also of course it owns more utilities which you have to use, and squeezes more money out of you via these because in order to attract capitalisation on the stock exchange, the 'competing' utilities have to pay-to-play with price parity and high profits, otherwise they dont have enough capital to lever investment in infrastructure.
With small and large employers alike, the owners or 'made man' managers can basically get something cheap or for free in the same way people expected second pairs of glasses on the NHS, or above inflation pay rises from the 'bad old days'. They can expect workers to do interns, or state subsidised work experience. They can offer zero hours contracts, or cut hours without warning. They can demand unpaid overtime as part of the job. When they do all this it goes out over the work force personally, and the state picks up the tab in unemployment and family income support - " work should always pay " is a mantra of both Brown and Cameron, rather than in fact forcing employers to take the responsibility and risk. The nanny state steps in to help prop up weak employers who dont want to risk having too many full time, permanent employees. Corporate welfare by the back door and front.
The state comes and bails them all out these days. Wallmart in the US, get cheap workers bailed out with welfare cheques. Big pharma in the US stil get preferential negotiatioins against the main government private insurance system because it has lobbied it into a cocked hat. The rail companies in the UK get their infrastructure paid for with state bail outs to keep the track safe and open new capacity, and even they get their new rolling stock bought by the state. They get their monopoly routes and over inflation fare rises rubber stamped by a Tory party still desperate to make a success of the mess they made of privatisation without competition. And of course the biggest bail out of them all, they first get national governments and state banks to borrow squillions totally irresponsibly and quite like with wide scale corruption dressed up as economic development. They also demand less control, less restriction, looser laws and the resulting increase in state sponsored, corrupt loans and anarchy in the financial vehicle markets crashes nearly the entirre western economy. Only they get a bail out from the casino they built, the nanny state gives them corporate welfare to protect society from themselves, and then uses the capitalist media to tell citizens that their last (left wing usually) governments were so irresponsible in their borrowing and are the real cause of the ills of society. Capital has organised itself to be ultimately powerful and ultimately legally corrupt.