Liam Byrne is the Labour MP for Birmingham, Hodge Hill, and has been an MP continually since July 2004. He currently chairs the UK parliament’s Business Select Committee and will probably be in the Labour Cabinet if Labour wins office.
Hodge Hill is one of England’s most deprived areas. It has the highest fuel poverty rate, the highest child poverty rate, the second highest unemployment rate, and it ranks second lowest on the index of deprivation (Guardian 5 January 2023). Liam Byrne is the chair of the East Birmingham Inclusive Growth Strategy (EBIGS) Board. (See the article on this in BATC: Link 1 below.)
‘The Inequality of Wealth: Why it matters and how to fix it’
In March Liam Byrne’s new book was reviewed by Michael Roberts, a Marxist economist, on his blog, after attending its launch. Here are some extracts from his comments. (See Link 2).
Byrne reckons that the social mission of the UK Labour party is for ‘equality’ and ‘fairness’, not for any radical transformation of the economic structure of the capitalist economy i.e. socialism – in this sense, he represents the ‘moderate’ wing of the party, or you might say, the current dominant pro-capitalist wing.
At the LSE launch, Byrne said he aimed to find ‘a middle way’ to rectify things between the view that nothing can be done and the view that some revolutionary transformation of the economic structure was needed, which the electorate would not accept. What were his policies for his ‘middle way’ to greater equality? What we want, Byrne said, was a “wealth-owning democracy” – a phrase recalling Thatcher’s ‘property-owning democracy’, which actually kickstarted the sharp rise in UK inequality in the 1980s. The phrase also echoes the position of the current Labour leader, Keir Starmer, who pledges to make Labour “the party of home ownership”.
Byrne’s aim is that everybody should get on the ladder to owning their own home (presumably with a mortgage) and also have some savings to invest for their retirement. To do this, a government should give every young person £10,000 to kick their careers off; the government should establish a sovereign wealth fund to build up funds (what for Byrne did not explain); and there should be fairer taxation eg income from capital gains should be taxed at the same rate as income from work. Byrne even flirts with the idea of a wealth tax on the very rich that could bring in billions for the economy and for redistribution. But that was basically it. Moreover, all these ‘radical’ measures to reduce inequality of wealth would have to be slowly introduced over “three parliaments” (I make that 15 years!), so that electorate gradually got used to the policies!
Policies for redistribution are not enough. What are needed are policies prior to redistribution to stop the creation of unequal wealth.
What Byrne never talked about was why there was such inequality of wealth and income in the UK and in all the other countries of the world? Why are the rich rich and why are the poor poor? Surely, there is something endemic to the capitalist economies that explains this permanent inequality. In several posts and papers, I have discussed the underlying causes of inequality; Byrne does not do so, it’s just there and shocking and we need to do something about it before it explodes into revolts.
But here is the policy problem. If inequality is endemic to capitalism, then what is needed are policies prior to redistribution. It is not a question of trying to redistribute excessive wealth from the rich to the rest of us through taxes and/or closing up evasion loopholes and tax havens etc. That might help a bit, but the underlying generation of the forces of inequality would remain untouched. Pre-distribution policies are needed.
Byrne advocated only one – better jobs with better pay for those at the bottom of the ladder. How that was to be achieved given the state of the UK economy (and other capitalist economies) was not explained. He also seemed to suggest raising the social security minimum level to take people out of poverty – again how that was to be implemented was not explained.
Would Richard Parker, if elected Mayor, campaign for Liam Byrne’s policies and aim to put them into practice in the West Midlands, and by a Labour Government?
Richard Parker’s campaign is based on ‘5 Pledges’:
- Create 150,000 jobs and training opportunities
- Revitalise high streets and bring back pride
- Tackle crime and anti-social behaviour
- Bring buses back into public control
- Fix the housing crisis and crack down on rogue landlords
Of course they should be supported, but they don’t go nearly far enough. For example, they don’t mention urgently tackling the causes of climate change. But there is another question on which Parker is silent. As Labour Mayor of the West Midlands he would be in a powerful position to aim to influence the policies of the Labour Party, and especially those of a Labour Government. Would he attempt to do so? We don’t know, because he has said nothing. And if he did, would he be using the Liam Byrne play-book?
What he should do, of course, if elected, is to campaign for policies for the redistribution of wealth and implement them where possible, while also campaigning for policies to stop the continuing creation of unequal wealth.
Richard Hatcher
29 April 2024
Link 2: https://thenextrecession.wordpress.com/2024/03/04/inequality-the-middle-way/
Birmingham Against The Cuts 