Why the left and the right are getting it wrong on poverty

Demos's new research shows that poverty can be both an economic and social phenomenon.

When the government announced that it was again reviewing how it measured child poverty, some on the left decried the move as "moving the goalposts". Iain Duncan Smith didn’t help matters by launching the consultation with a speech which seemed to suggest he had already made up his mind. The focus on family breakdown, in particular, raised hackles – in essence, poverty would be measured by how long a child had been raised in a two-parent family. While single parenthood can mean a lower income, to suggest a child should be deemed in poverty on this basis alone betrays a particular ideological outlook.

This is a shame, because it has meant that many have dismissed the consultation out of hand, as yet another cynical attempt by government to move the focus of the poverty strategy away from tackling deprivation and towards stigmatising single parents and troubled families. But the fact is, a more holistic measure of poverty – which takes causal factors and symptoms into account – will give us a better understanding of poverty, and help politicians tackle it more effectively.

Both the government and the opposition risk falling down an ideological rabbit-hole now that the definition of poverty is back on the agenda. On the right, the Victorian tendency to explain poverty as a social problem, experienced by troubled families, and brought on by their own failings and weaknesses, will no doubt lead to a critically limited range of policy responses. But this will be no more limited than the response from the left, whose fixed position that low income is the central feature of poverty has in the past led to a one-dimensional, technocratic approach – memorably described as "poverty plus a pound", where poverty is "solved" by redistributing until enough people are over the invisible poverty line.

Our research published today seeks to take the politics out of poverty and use evidence to point to the best policy response. By applying 20 separate indicators associated with poverty to the population below the poverty line, we keep income central to our understanding – but also recognise that the lived experience of poverty is never just about one’s bank balance, but a complex interaction of social issues, spanning one’s social networks, health, education, and housing.

The result is 15 distinct types of poverty across three cohorts – households with children, those without, and pensioners. Each type of poverty is made up of a unique combination of the different indicators, creating a sense of the "lived experience" of each type.

What was clear was that while some of the poverty types were experiencing the kind of poverty the government has set out to solve – unemployment, debt, single parenthood and poor health – many were not. The most prevalent type of child poverty (applying to about a third of families) was defined by long work histories in poorly paid jobs or recent redundancy from well paid jobs, a strong work ethic, home ownership and good education.

Our research disproves the assumptions held by those on both ends of the political spectrum – and concludes that poverty can be both an economic and social phenomenon, depending on the household in question. Perhaps this smacks of sitting on the fence – an excuse to do nothing. But this is far from the case. In fact, the findings represent a highly inconvenient truth. The truth is that there is no magic bullet to ending poverty – neither a crusade against troubled families, nor a predistribution and living wage strategy will be effective in isolation.

An effective poverty strategy will not, in fact, serve either party’s particular ideological standpoint. Indeed, our findings suggest there is no such thing as an effective poverty strategy, but that each type requires its own strategy, each one relying on a coordinated response from different combinations of agencies – good, old-fashioned joined-up government.

Those on the front-line working with poor families might be wondering what’s new here. They already know that a poorly skilled young mother struggling to put food on the table needs different help to a recently redundant, middle aged divorcee coping with a vastly reduced income.

But the Demos work has, for the first time, articulated and quantified this difference – and in so doing, shows exactly where existing narrower approaches are falling short. With the government’s consultation, we have an unprecedented opportunity to harness the evidence to guide our policy response – but politicians on both sides must first learn that a sincere attempt to tackle poverty is an issue beyond politics.

Claudia Wood is deputy director of Demos

Two young boys play football in a run down street in the Govan area of Glasgow. Photograph: Getty Images.

Claudia Wood is deputy director of Demos.

Getty
Show Hide image

How the mantra of centrism gave populism its big break

A Labour insider reflects on the forces behind the march of populism. 

For just under a quarter of a century, British politics has been dominated by what might be called, paradoxically, a “theology of centrism” - the belief that most people were more concerned with what works than ideology, and that politics should principally be the art of improving the delivery of public goods. It was a theology that, for all their policy differences, united Tony Blair and David Cameron. Anyone who thought electoral success could be won anywhere but from the centre was either naïve or fanatical, or both... but definitely wrong.

Now, populism is on the march across the West. In Britain, as elsewhere, the political class is unnerved and baffled.

So what happened? Partly, as with all revolutions in politics, the answer is: “events”. Unsuccessful wars, economic crashes and political scandals all played their part. But that isn’t enough of an explanation. In fact, the rise of populist politics has also been a direct result of the era of centrism. Here is what has taken place:

1. A hollow left and right

First, the theology of centrism was the culmination of a decades-long hollowing out of mainstream politics on the left and right.

In the mid-20th century, Conservatism was a rich tapestry of values – tradition, localism, social conservatism, paternalism and fiscal modesty, to name but a few. By 1979, this tapestry had been replaced by a single overriding principle - faith in free-market liberalism. One of Margaret Thatcher's great achievements was to turn a fundamentalist faith in free markets into the hallmark of moderate centrism for the next generation of leaders.

It is a similar story on the left. In the mid-20th century, the left was committed to the transformation of workplace relations, the collectivisation of economic power, strong civic life in communities, internationalism, and protection of family life. By the turn of the 21st century, the left’s offer had narrowed significantly – accepting economic liberalism and using the proceeds of growth to support public investment and redistribution. It was an approach committed to managing the existing economy, not transforming the structure of it or of society.

And it was an approach that relied on good economic times to work. So when those good times disappeared after the financial crash, the centrism of both parties was left high and dry. The political economic model of New Labour disappeared in the first days of October 2008. And when a return to Tory austerity merely compounded the problem of stagnant living standards, public faith in the economic liberalism of the centre-ground was mortally wounded.

2. Fatalism about globalisation

Second, Labour and Tory politics-as-usual contained a fatalism about globalisation. The right, obsessed with economic liberalism, welcomed globalisation readily. The left under Bill Clinton in the US and Blair in the UK made their parties’ peace with it. But globalisation was not a force to be managed or mitigated. It was to be accepted wholesale. In fact, in his 2005 Conference speech, PM Tony Blair chastised those who even wanted to discuss it. “I hear people say we have to stop and debate globalisation," he said. “You might as well debate whether autumn should follow summer. They're not debating it in China and India.” (I bet they were, and still are.) The signal to voters was that it was not legitimate to fret about the pace and consequences of change. No wonder, when the fretting began, people turned away from these same politicians.

3. A narrowing policy gap

Third, the modernising projects of Blair and Cameron ended up producing a politics that was, to use Peter Mair’s term, “cartelised”. The backgrounds, worldviews and character of party elites began to converge significantly. Both parties’ leaderships accepted the same external conditions under which British politics operated – globalisation, economic liberalism, sceptical acceptance of the EU, enthusiasm for closeness to the US on security issues. The policy space between both main parties narrowed like never before. As a result, economic and class divisions in the country were less and less reflected in political divisions in Westminster.

The impression arose, with good reason, of an intellectual, cultural and financial affinity between politicians across the main divide, and between the political class and big business. This affinity in turn gave rise to a perception of “groupthink” across the elite, on issues from expenses to Europe, and one that came with a tin ear to the concerns of struggling families. It may be misleading it is to depict all politicians as snug and smug members of a remote Establishment. Nevertheless, social and economic convergence inside Westminster party politics gave populists an opportunity to present themselves as the antidote not just to Labour or the Tories, but to conventional politics as a whole.

4. New political divides

Lastly, the populist moment was created by the way in which new electoral cleavages opened up, but were ignored by the main political parties. The last decade has seen a global financial crash that has restored economic insecurity to frontline politics. But at the same time, we are witnessing a terminal decline of normal party politics based fundamentally on the division between a centre-left and centre-right offering competing economic policies. 

Of course economics and class still matter to voting. But a new cleavage has emerged that rivals and threatens to eclipse it - globalism vs nationalism. Globalists are economically liberal, positive about trade, culturally cosmopolitan, socially progressive, with a benign view of globalisation and faith in international law and cooperation. Nationalists are hostile to both social and economic liberalism, want more regulation and protection, are sceptical of trade, see immigration as an economic and cultural threat, and have little time for the liberal international order.

The factors that drive this new electoral divide are not just about voters’ economic situation. Age, geography and education levels matter – a lot. Initially both main parties were tectonically slow to respond to this new world. But populism – whether Ukip, the SNP or Theresa May's Tories – has thrived on the erosion of the traditional class divide, and sown seeds of panic into the Labour party as it faces the prospect of sections of its traditional core vote peeling away.

Centrists thought their politics was moderate, pragmatic, not ideological. But signing up to free market liberalism, globalisation and an economistic view of politics turned out to be seen as a curious kind of fundamentalism, one which was derailed by the 2008 crisis. The exhaustion of the theology of centrism did not create populism – but it did allow it a chance to appeal and succeed.

Those on the left and right watching the march of populism with trepidation need to understand this if they are to respond to it successfully. The answer to the rise of populist politics is not to mimic it, but to challenge it with a politics that wears its values proudly, and develops a vision of Britain’s future (not just its economy) on the foundation of those values. Populists need to be challenged for having the wrong values, as well as for having anger instead of solutions.

But calling for a return to centrism simply won’t work. It plays precisely to what has become an unfair but embedded caricature of New Labour and Notting Hill conservatism – power-hungry, valueless, a professional political class. It suggests a faith in moderate managerialism at a time when that has been rejected by events and the public. And it tells voters to reconcile themselves to globalisation, when they want politicians to wrestle a better deal out of it.

Stewart Wood, Lord Wood of Anfield, was a special adviser to No. 10 Downing Street from 2007 to 2010 and an adviser to former Labour leader Ed Miliband.