Clegg can’t increase social mobility without reducing inequality

The Deputy PM needs to remember that the most socially mobile countries are the most equal.

For Nick Clegg, the ultimate test of the success or failure of the coalition is whether it increases social mobility. Indeed, he has previously declared that increasing mobility, not reducing income inequality, should be the "ultimate goal" of progressives (obviously a false dichotomy, as I'll explain below). Today, with the publication of the government's social mobility strategy, he has a chance to explain how the coalition will succeed where Labour failed.

Clegg's plans to "open up" internships, which, as he says, "rig the market in favour of those who already have opportunities", are previewed in this morning's papers. Ministers will reportedly warn firms that they must pay young interns, or risk a legal challenge under the National Minimum Wage legislation.

In addition, the Conservative Party chairman, Sayeeda Warsi, will announce that the civil service will end informal internships by 2012 and that all vacancies will be advertised on a central website. Progressive stuff from the party that auctioned off City internships to raise funds at its Black and White Ball.

In their joint op-ed piece for the Daily Telegraph, Clegg and Iain Duncan Smith, the Work and Pensions Secretary, write:

Labour couldn't make up its mind on what goal it was chasing. Social exclusion? Income poverty? Inequality? Social mobility? Lacking a clear agenda, it fixated on just one measure of fairness - the poverty line, defined as 60 per cent of median income. This is a necessary part of the equation, but it is very far from sufficient.

Labour deserves to be criticised, but not for the reasons that Clegg and Duncan Smith suggest. It was the Blair government's unwillingness to address runaway inequality that meant social mobility remained stagnant. As I have repeatedly pointed out, all the international evidence we have suggests that the most socially mobile countries are also the most equal.

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As the graph above (from the excellent book The Spirit Level, by Richard Wilkinson and Kate Pickett) shows, countries such as Sweden, Norway, Denmark and Canada, where income inequality is low, have far higher levels of social mobility than the United States and the UK, where income inequality is high. This is hardly surprising: greater inequalities of outcome make it easier for rich parents to pass on their advantages to their children.

As Will Hutton's recent report on public-sector pay for the coalition government noted: "There is now good evidence that income inequality can become entrenched across generations, as elites monopolise top jobs regardless of their talent, gaining preferential access to capital and opportunities. This harms social mobility."

To suggest, based on just 13 years of Labour government, that redistribution failed is wilfully naïve. It took decades of centre-left government in Scandinavia to create the most equal societies the world has known. I hope that I will be proved wrong, but all the evidence we have suggests that the coalition's cuts will increase inequality and, consequently, reduce social mobility.

George Eaton is political editor of the New Statesman.

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Forget planning for no deal. The government isn't really planning for Brexit at all

The British government is simply not in a position to handle life after the EU.

No deal is better than a bad deal? That phrase has essentially vanished from Theresa May’s lips since the loss of her parliamentary majority in June, but it lives on in the minds of her boosters in the commentariat and the most committed parts of the Brexit press. In fact, they have a new meme: criticising the civil service and ministers who backed a Remain vote for “not preparing” for a no deal Brexit.

Leaving without a deal would mean, among other things, dropping out of the Open Skies agreement which allows British aeroplanes to fly to the United States and European Union. It would lead very quickly to food shortages and also mean that radioactive isotopes, used among other things for cancer treatment, wouldn’t be able to cross into the UK anymore. “Planning for no deal” actually means “making a deal”.  (Where the Brexit elite may have a point is that the consequences of no deal are sufficiently disruptive on both sides that the British government shouldn’t  worry too much about the two-year time frame set out in Article 50, as both sides have too big an incentive to always agree to extra time. I don’t think this is likely for political reasons but there is a good economic case for it.)

For the most part, you can’t really plan for no deal. There are however some things the government could prepare for. They could, for instance, start hiring additional staff for customs checks and investing in a bigger IT system to be able to handle the increased volume of work that would need to take place at the British border. It would need to begin issuing compulsory purchases to build new customs posts at ports, particularly along the 300-mile stretch of the Irish border – where Northern Ireland, outside the European Union, would immediately have a hard border with the Republic of Ireland, which would remain inside the bloc. But as Newsnight’s Christopher Cook details, the government is doing none of these things.

Now, in a way, you might say that this is a good decision on the government’s part. Frankly, these measures would only be about as useful as doing your seatbelt up before driving off the Grand Canyon. Buying up land and properties along the Irish border has the potential to cause political headaches that neither the British nor Irish governments need. However, as Cook notes, much of the government’s negotiating strategy seems to be based around convincing the EU27 that the United Kingdom might actually walk away without a deal, so not making even these inadequate plans makes a mockery of their own strategy. 

But the frothing about preparing for “no deal” ignores a far bigger problem: the government isn’t really preparing for any deal, and certainly not the one envisaged in May’s Lancaster House speech, where she set out the terms of Britain’s Brexit negotiations, or in her letter to the EU27 triggering Article 50. Just to reiterate: the government’s proposal is that the United Kingdom will leave both the single market and the customs union. Its regulations will no longer be set or enforced by the European Court of Justice or related bodies.

That means that, when Britain leaves the EU, it will need, at a minimum: to beef up the number of staff, the quality of its computer systems and the amount of physical space given over to customs checks and other assorted border work. It will need to hire its own food and standards inspectors to travel the globe checking the quality of products exported to the United Kingdom. It will need to increase the size of its own regulatory bodies.

The Foreign Office is doing some good and important work on preparing Britain’s re-entry into the World Trade Organisation as a nation with its own set of tariffs. But across the government, the level of preparation is simply not where it should be.

And all that’s assuming that May gets exactly what she wants. It’s not that the government isn’t preparing for no deal, or isn’t preparing for a bad deal. It can’t even be said to be preparing for what it believes is a great deal. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to domestic and global politics.