Prominent US economist, Robert Reich, is the star of a new film - Inequality for All - which promotes his long-held and convincingly argued view that capitalism and, ultimately, democracy are doomed unless they undergo fundamental change. He quotes many statistics, among them this one: 50% of the wealth of the U.S. is now owned by just 400 individuals. He seeks to demonstrate how this grotesquely unequal wealth distribution has, among other things, wiped out a key engine of economic growth - the purchasing power of the middle classes. Furthermore, the situation he describes is a repeat of that which pertained in 1928, just prior to the great depression of the 1930’s, so there are no prizes for guessing what is about to happen. And there is no reason to be smug, for the U.K. is following the same pattern.
But surely we have all learned to be sceptical of statistics? Successful academics, politicians and shareholders have always been able to interpret them favourably in support of their cases and, back in 2008, the credit-rating agencies famously manipulated them to reassure markets that the banks were in good shape. A sensible precaution against such misinterpretation is to test all statistics against common-sense in the form of everyday observations and anecdotes. For example, a nifty indicator of the level of economic activity in a given period is the corresponding number of white vans sold. We may not have direct access to actual sales figures but it is plain to see the vans on our roads. Back in the heady days of easy credit and (unsustainable) growth it seemed that every other vehicle was a white van, speeding aggressively towards the next opportunity, its occupants wild-eyed with urgency and the prospect of well-paid work. Nowadays the iconic Ford Transit plant near Southampton is closed down and vans are becoming fewer, dirtier, more bashed-up and recycled; their occupants hollow-eyed, listless and disillusioned.
There is talk of realigning the wealth imbalance: even within that bastion of capitalism, the English Football Premier League, a mutual agreement to limit the amount of money allocated to players is imminent. But this could be a hollow gesture if, as one pundit believes, the star players will continue to receive high fees while savings will be made by cutting the pay of their less talented team-mates. Meanwhile city traders and bankers insist that they must have bonuses because high wages alone are not sufficient to get them out of bed. And so the system which brought economic calamity remains fundamentally in place.
Walking around the city - past boarded-up shops, cut-price drinking joints, pawn-brokers, neglected civic buildings and facilities - I have noticed how easy it is to become lulled incrementally into acceptance of the aggregating symptoms of economic malaise. I have also noticed an increase in the number of beggars on the streets. Over the years I have become inured to their pleas for money because frequent rumours of fraudulent or professional beggars have made me sceptical of their destitution and wary of being tricked into charitable acts. But something happened this week which made me stop and think again about beggars.
There are different types: aggressive, passive, rude, polite, drunk, sober, dishevelled, tidy, male, female, with dog, without dog, physically able and physically disabled. Many of them ply the same streets as the buskers, mime-artists and performers - to whom I might donate (depending on merit). But I came across a beggar sitting on the pavement, his back against a wall, his head held down and a sign in his hand informing everyone that he was hungry. His sober clothing, respectable middle-aged appearance and abject look of misery implied that he was recently impoverished. Something made me put my hand in my pocket and drop coins into his hat. Was I persuaded by the statistic that most middle-class households are only three pay-cheques away from destitution? Or had I, perhaps, just witnessed a new and powerful phenomenon: begging as street-performance?