Daily Politics

Watching a debate on the Daily Politics, BBC2 about Marxism Vs Socialism. It’s an apt topic, but the pure capitalist endorser, Dr Madsen Pirie of the Adam Smith Institute doesn’t display a solid understanding of the facts, but simply touts his deeply held, ingrained ideology.

He claims that improving the wealth of the rich, improves the livelihoods of the poor. But that is far from proven. There exists some correlation, but the first rule of statistics is that correlation doesn’t equate to causation.

The inequality gap is at it’s greatest since The First World War and he says he doesn’t care! As if this isn’t a concern, or detrimental to the well being or state of the economy at large. Allow me to elaborate.

People on lower incomes have a greater marginal propensity to consume; if you increase 10 peoples’ £10k income by 10%, they are far more likely to spend that extra 10% than someone who receives an extra 10% on their £100k income. Improving the livelihood of the poor from the bottom up, is good for capitalism, better in fact than top-down, trickle-down policies.

The inequality gap should be of concern to Dr Pirie, not only for moral reasons, but somewhat contradictory to my opening paragraph, reducing it will support his own ideological goals.