In a society of gross inequality, the aspirations of everyone are thwarted

In any count of the phrases most used by postwar western politicians, social mobility and equality of opportunity would come somewhere near the top. Tory and Labour, Republican and Democrat, all can agree on their desirability, if not on how to achieve them. Questions about the distribution of resources within society are conveniently put on one side. Provided everybody has a chance to reach the top, it doesn't matter if chief executives earn 125 times more than the average worker.

That belief is the underlying flaw in the government's white paper on social mobility published on 13 January. Most of its proposals are admirable: free childcare and early learning places for two-year-olds from low-income families; another 35,000 apprenticeships; £10,000 bonuses for teachers in the most difficult schools. But poverty and income inequality are barely mentioned. In contrast, the report of the Liberal Democrats' commission on social mobility, published the day before the white paper, puts at the top of its recommendations a minimum income standard for families, better targeting of child tax credit and the creation of a poverty premium index to track changes in prices of essential goods and services.

Upward social mobility among men rose rapidly in the middle decades of the 20th century because of a sharp increase in professional and managerial jobs and a corresponding decline in manual employment. This change in economic and social structure created, to borrow the title of a 1950s novel, "room at the top". Since the 1980s, however, those trends have flattened out. Social mobility has not declined, but nor has it risen, except among women, who have recently benefited from the dismantling of many (if by no means all) gender barriers. More than 40 per cent of men will find themselves in the same class as their fathers, not even moving from, say, unskilled to skilled manual work.

The odds on children getting top jobs and salaries, therefore, remain overwhelmingly dependent on their class origins. A boy from social class one has a more than 30 times better chance of himself getting a class one job - as a banker or barrister, say - than a boy from the unskilled working class. The 20th century brought not only a rise in upward mobility, but a decline in downward mobility. Of men born into the top two social classes in 1900, barely half stayed there in adulthood. Now, three-quarters maintain their status. In a country that aspires to be a meritocracy, the barriers against middle-class dullards falling are as strong as those against bright working-class children rising. Among those barriers are the growing need for young people to undergo lengthy postgraduate training and/or periods of unpaid (or very low-paid) internship, both of which require parental subsidy, before they can enter high-status professions, particularly the law, media and arts. The white paper announces that the über-Blairite Alan Milburn will be recalled from exile to chair a panel "which will work closely with the professions to identify barriers to access". But as ministers well know, it will be hard to stop middle-class parents finding ways to give their children a leg-up.

So the government places most hopes for more social mobility in a new surge in professional and other highly skilled jobs, comparable to that in the 1950s and 1960s. If we can seize "emerging global opportunities", it promises, "each successive generation" can get better jobs than the last. Ministers believe the answer lies in educating more children to high levels. They plan to keep all young people in education until 18 and increase the proportion entering university to around 50 per cent. Yet it is far from clear that, even when the world economy picks up, there will be sufficient high-status jobs to absorb so many graduates, and the government's record in picking global opportunities - the last being the financial services industry - does not exactly inspire confidence.

There is a further problem. In a society of gross inequality, aspiration and cognitive development can be stunted among those at the bottom of the economic pile. As the Liberal Democrats' commission points out, children from poor homes start to fall behind long before school. Low-social-class children who do well in tests at 22 months fall behind similarly bright, high-social-class peers before they are four. By five, they are barely ahead of high-social-class children who scored badly in tests at 22 months; by ten, those children have overtaken them.

To counter this, ministers rightly propose to strengthen early intervention schemes. But there is no guarantee they will work. The countries with the highest social mobility - the Nordic countries and Canada, for example - are also those with the lowest inequality and lowest rates of child poverty. The converse is true for those, such as Britain and the US, with the lowest social mobility. The government should not ignore indefinitely what is staring it in the face.

This article first appeared in the 19 January 2009 issue of the New Statesman, Obama: What the world expects...