Bryan Bruce’s documentary continues the much needed conversation about the creeping and destructive inequality that has accelerated under the market-driven reforms New Zealand embraced so comprehensively.
It is pointless to dispute the fine details of the measurements of inequality he uses. We can see, if we open our eyes, the overwhelming evidence that is all around us. This is a documentary that must not be hijacked by the academics who might nitpick about technical issues. It is actually about a moral philosophy.
Bruce is deliberately provocative, so, for example, he uses the ‘God is dead’ explanation for rampant greed. If God is not watching and judging you then anything goes. While this has a shred of truth perhaps, it leaves us nowhere to go. The genie is out of the bottle. More significantly, the documentary moves us on from the mere correlation of social ills and inequality (The Spirit Level) to a more sophisticated story of the causation of inequality itself. When the more enlightened right profess to be concerned about poverty but not inequality, the left need to be able to tell the story of the suffocating interconnections of the fortunes of the top and the bottom.
Bruce starts to flesh out the narrative of how we got to where we are and hints at why the inequality has within it, the seeds of its own destruction. In a perverse trickle up process, deregulation of the labour market, ostensibly to give workers a chance to get a job, produces the low wages that allow higher profits to flow to the shareholders. The poorly paid need cash support such as Working for Families to sustain demand and so to sustain profits while allowing wages to be low, again, trickle up. Likewise, the tax-funded accommodation supplement is appropriated in higher rents by landlords. GST on everything is part of the flat tax mantra and allows flatter lower tax rates for top incomes. Meantime as the poor need to borrow to survive, the wealthy are enticed to avoid and evade tax. They see it as sport at which they can be winners, reaping where they have not sown.
The challenge now is to continue this narrative until middle and upper New Zealanders actually understand the linkages. A mind shift is needed from the traditional view that inequality is necessary to provide savings to spur growth and is needed to provide aspiration for the poor. Margaret Attwood in her book on debt called ‘Payback’ explains how the debtor and the creditor are joined at the hip, you cannot have one without the other.
Thus, part of the neoliberal model is to extol the virtue of saving. In this morality story, reinforced by elements of a self-interested avaricious financial sector, savers are ‘good ‘people and the debtors are the ‘bad’ people. The problem is that the one does not see the other. The savers are told it is silly to have cash at the bank earning no interest and are applauded when they take ‘proper financial advice’ and earn a higher return on their ‘hard earned savings’. The ‘good’ savers are shielded from the sight of the destination of their saving, which might be to a sole parent purchasing a dodgy second hand car deal at high cost via a finance company, or an over-mortgaged family via a profit hungry bank. No matter, the saver gets paid and is praised for self-responsibility, while on another part of the planet the sole parent is demonised as the foolish debtor, and the family as feckless over-committed borrowers. Inequality inexorably widens as the debtors borrow to service their debts to feed the high returns claimed as the reward for the ‘noble’ sacrifice of the high income and wealth savers.
There are many other examples of the insidious intertwining of the accelerating poverty of the poor and the compounding gains of the wealthy. In a vicious cycle, pokie machines feed the profits of the multinationals and while charities rely on a share of these profits to provide services for those in need. One is co-dependent on the other. In the aged care sector, the ‘for profit’ retirement villages residents need the dividends from the likes of MetLife care to pay for their fees, so fees have to be high so companies can pay high dividends. Same for early private childhood education. The poorest are then denied access to these services or may need expensive tax- funded subsidies paid for by a heavily regressive tax system.
The unpleasant arithmetic of inequality sees wealth compound while debt and poverty also compounds. The challenge is for each of us to tell the story in our own worlds, of the connections in the widening of the gap. My world of work is the university, now that is a story for another day!
Bryan Bruce’s documentary provides welcome insights into how the acceleration of excesses of the rich are in fact the problem. Not the laziness of the poor, or the number of children they foolishly had. Now let the debate begin of how we actually reform policy to produce a fairer New Zealand, hopefully without a revolution.