Tackling inequality will help economic growth

There is much talk about the need for growth in the economy, so the country can pay for vital services like health, social care, education and transport. It is a case of increasing the size of the economy in order that these things can be afforded. Or is it? The big problem of society today is inequality. There can be growth created but at present, the spoils of such success will flow to the few very rich people in society. That is why in a country like America, which had a buoyant economy, with 3 per cent growth, under the previous Biden adminstration, the majority of people did not feel the benefits. The cost of living crisis hit hard, with the mass of people feeling worse off. They did not get the benefit. The result, Donald Trump was returned as President promising to make America great again. Inequality needs to be addressed. The present Labour government has taken some steps to tackle inequality, like raising the minimum wage and improving worker's labour rights. There is talk of scrapping the two child limit for child benefit. But there has been no effort to make those who have the most pay more tax. In the 1970s, tax rates on the rich were much higher. The gap between rich and poor was narrower and people were happier. The polarisation of wealth with a flow from everyone else to the uber rich has been ongoing since 1980. Since 1995, the top 1 per cent have captured. 20 times more of global wealth than the bottom 50 per cent. If the government needs more funds for basic services, tax the rich, don't go for the poorest and most vulnerable in society. The cry goes up the rich will all leave the country but this is largely a myth. Some may go but if they don't want to contribute to the common good, is that a bad thing? There are though plenty of rich people who want to pay more. Patriotic Millionaires UK are one such group. They can see the unsustainability of the present system. So let them pay more. Universal basic income is another thing that would help reduce inequality. If AI has the impact predicted, then a form of universal basic income will become obligatory to keep the economy functioning. So, yes sustainable growth is needed but the fruits of such developments must be spread more evenly. A more equal society is a happier and better functioning place for everyone, including the very rich.