Being ‘in it together’. Sharing the burden. Putting the shoulder to the wheel. Pulling on the green jersey. In Ireland and elsewhere, these are among the euphemisms that have entered the lexicon of politicos in the age of austerity.
At the same time, of course, such exhortations to shared sacrifice have not always been supported by fiscal principles that see the burden matching means. In fact, austerity budgets have often hit the poorest hardest. The UK Chancellor’s recent ‘budget for working people’ was nothing of the kind: slashing working tax credits while cutting tax on corporations and hefty inheritances. Sometimes, inequality happens by accident. Sometimes it’s a matter of policy. By the same token, public policy can make things better – for everyone. It doesn’t have to be a zero sum game.
In May, the OECD launched the third instalment in its inequality trilogy: In it together: why less inequality benefits all. This tome builds on earlier work, 2008’s Growing Unequal?, and its 2011 sequel, Divided we stand. Even the IMF has been getting in on the act, publishing work last year on the links between inequality, redistribution and growth. In short, lower inequality is linked to stronger and more sustainable economic growth, while redistribution doesn’t reduce it.
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