‘An education arms race’: inside the ultra-competitive world of private tutoring

A growing number of parents and guardians are paying for children as young as four to receive additional tuition. What is fuelling this booming industry asks Sally Weale in The Guardian?

As dusk falls in the Girlington district of Bradford, a trickle of cars begin to arrive in front of a small parade of shops. Parents who have just collected their children at the end of the school day are dropping them off at the Explore Learning tuition centre for extra maths and English coaching. The children sit at a cluster of computer terminals, where they log in to begin their evening studies. The atmosphere is relaxed and lighthearted. The children stay for an hour to work through their lessons, helped where necessary by a member of staff, with 15 minutes’ playtime at the end.

Located next to a Domino’s and a Subway, the Bradford branch of Explore Learning is a tiny window into Britain’s booming private tuition sector, now worth an estimated £2bn. At one time, private tuition meant a weekly one-to-one session at home with a tutor, the preserve of the privileged few. It is still not cheap – Explore Learning’s standard membership costs £119 a month, plus a £50 registration fee – but it is now on offer on our high streets, in supermarkets and increasingly online, with tutors offering their services from as far afield as India and Sri Lanka. Tutees include children who are little older than toddlers, pupils at prestigious private schools and undergraduates struggling at university. All are caught up in an educational arms race, which experts say is exacerbating social inequality.

The success of Explore Learning reflects some of these changes. The business was founded in 2001 by Bill Mills, a Cambridge maths graduate, and now has 139 centres around the country (plus five in Texas run by a sister company). They are located mainly in shopping centres, so busy parents can get on with their weekly shop while their offspring perfect their times tables, punctuation and grammar. Most of the children, who are aged four to 14, come at least a couple of times a week – the membership allows for up to nine sessions a month. Saturday and Sunday afternoons are the busiest times in the Bradford branch, which has 290 children on its books. The tutor-tutee ratio is one to six, but the tutors are not usually qualified teachers; they may be students or mothers returning to the workplace. All are trained in the teaching materials and behaviour management.
The families who use the centre come from various walks of life. Some parents have their own businesses; others work at Bradford Royal Infirmary. There are families from Latvia, Poland and the Philippines. The parents talk about giving their children “an edge”, the “leg up” they never had. Among them are a shift worker, Malik Ijaz, and his wife, Ayesha, who have been bringing nine-year-old Abubakar and his seven-year-old sister, Amna, to the centre for nearly two years. It is a big expense for the family, but the children’s education is a priority. Ijaz works extra shifts to be able to afford it. A third child, four-year-old Ali, will come when he is older.

‘I’m trying to do something for him that I never got’ ... Geoff Clayton, Brooklyn’s grandfather. Photograph: Christopher Thomond/Christopher Thomond/Guardian

“The world is very competitive and everybody is working very hard,” said Ijaz. “I know the school are doing very well, but there are 30 students in each class. It’s one teacher and support staff. They try their best to help, but I realise if I’m going to give my kids some extra help it’s going to be brilliant for their future. Anyone who does a bit extra always gets ahead.”

He is ambitious for his children. “I warn my kids they should be top – or among the top five at least – in class. They are doing well. I don’t mind paying extra. I’m investing in their future. I know the importance of education. My kids love it.”

Abubakar, a quiet, serious child, is planning to sit the 11-plus to win a place at grammar school. Sometimes he does not feel like starting work, “but when I’ve started I like to carry on”. Amna is a chatty livewire and wants to be a paleontologist. “I’m good at maths, but the thing I’m best at is history,” she chirps. “My brother does hard work. I’m doing the same now. I want to be the same as him.”

Geoff Clayton, a retired garage worker, has been bringing his 10-year-old grandson, Brooklyn, to Explore Learning for about nine months. Brooklyn lives with his grandparents and likes football, Minecraft and maths. “He’s done really well,” says Clayton. “His reading has got a lot better, everything’s got better.” The membership takes a significant chunk out of his pension, but he is happy to pay it to give Brooklyn “a bit of a leg up”.

“Nowadays, it’s all about exams and certificates and what you know,” he says. “When I left school, it was more: ‘Can you do the job?’ Brooklyn has done a heck of a lot better since coming here. Sometimes he moans, but he’s OK once he’s here. It does work if you’re prepared to put the time and effort in.”

The Sutton Trust, a charity that seeks to improve social mobility through education, has documented a huge rise in private tuition in recent years. Its annual survey of secondary students in England and Wales revealed in July that 27% have had home or private tuition, a figure that rises to 41% in London.

The Bradford outpost of Explore Learning, which now has 139 centres across the UK. Photograph: Christopher Thomond/Christopher Thomond/Guardian

With tutoring commanding a fee of about £24 an hour, rising to £27 in London (although many tutors charge £60 or more), the trust is concerned that the private tuition market is putting children from poorer backgrounds at even greater disadvantage. To redress the balance, it would like to see the government introduce a means-tested voucher system, paid for through the pupil premium funding that schools receive to support disadvantaged pupils.
“We are in an education arms race,” says Peter Lampl, the founder of the trust. “Parents are looking to get an edge for their kids and having private tuition gives them that edge. But if we are serious about social mobility, we need to make sure that the academic playing field is levelled outside the school gate.”

Initiatives aimed at making tuition more accessible already exist: some agencies pledge a proportion of their tuition to poorer pupils for free, while non-profit programmes such as the Tutor Trust connect tutors with disadvantaged schools. Explore Learning offers “scholarships” that give a 50% discount to parents on income support or jobseeker’s allowance. Parents can also use childcare vouchers and tax-free childcare schemes to help pay for tuition.

Nevertheless, huge inequities in education persist. Nowhere is this more evident than in children’s battle to pass the 11-plus to get into grammar school. Research published earlier this year revealed that private tutoring means pupils from high-income families are much more likely to get into grammar schools than equally bright pupils from poorer families. John Jerrim and Sam Sims from the Institute of Education at University College London looked at more than 1,800 children in areas where the grammar school system is in operation. They found that those from families in the bottom quarter of household incomes in England have less than a 10% chance of attending a grammar school, compared with a 40% chance for children in the top quarter.


If we are serious about social mobility, we need to make sure the academic playing field is levelled outside school - Peter Lampl, the Sutton Trust

They also established that wealthier families are much more likely to use private tutors to prepare their children for the entrance exam. Fewer than 10% of children from families with below-average incomes received coaching, compared with about 30% from households in the top quarter. About 70% of those who received tutoring got into a grammar school, compared with 14% of those who did not.
Alexa Collins lives in Buckinghamshire, which operates a grammar school system. She could not afford tuition to prepare her daughter for the 11-plus; despite being a top performer at primary, she failed the test, but has since thrived at her comprehensive, gaining nine GCSEs.

Collins, who went to grammar school herself but received no coaching, says she is ideologically opposed to tutoring because it is unfair to those who cannot afford it. Although she can see the case for short-term tutoring on a specific subject when a child is struggling, she adds: “I think it’s awful, that idea of tutoring kids from seven to push them through this exam. How can you possibly put that pressure on them?”

Another parent, who wishes to remain anonymous but lives in Kent, which operates grammar schools, says her son tackled the 11-plus without a tutor. “It felt morally wrong to claim an advantage by paying cash. It’s so unfair.” As she tried to coach her son, she felt at huge disadvantage. “So much depends on a parent’s skills to teach. A tutor would know the best way to teach the 11-plus concepts. I was terrible at maths at school, so I was really stuck.”

“The government claims that expanding grammars will boost social mobility,” said Jerrim, a professor of education and social statistics at UCL, when the research was published. “But our research shows that private tuition used by high-income families gives them a big advantage in getting in.” One of the factors behind the increase in tuition, he says now, is the pressure exerted by school league tables and growing accountability measures. “Those schools might well be passing pressure on to parents,” he says. “It’s not a negative reflection on schools and the job that they are doing; it’s more a reflection of the pressure they are under to achieve results.”

A callout asking Guardian readers about their experiences of tuition drew hundreds of responses from tutors, parents and school teachers. One tutor told of being approached by parents of children as young as three or four; another had been hired to provide extra coaching for pupils whose parents were already paying for all of the privileges of private schools, including Marlborough and Eton. “We pay thousands of pounds a year on school fees,” said one parent. “If he needs a little help with certain subjects, why wouldn’t you help him?” There also appears to be a trend for university students to buy extra tuition. Most are already paying £9,250 a year in tuition fees, so why not spend a little more to ensure they get the best possible degree?

The Profs, which launched in 2014, specialises in degree-level and professional-qualification tutoring. According to its website, an undergraduate teacher with a master’s in the required subject costs upwards of £70 an hour (plus a £50 placement fee); tutors specialising in applications to Oxbridge and Ivy League universities start at £120 an hour, plus a £250 consultation fee. According to Leo Evans, one of the founders of The Profs, university lecturers can struggle to address individual learning difficulties. “Catching stragglers and helping them get on top of their studies is a useful social function. Also, for students with disabilities and impairments, it’s essential.”

 I don’t mind paying extra. I’m investing in their future’ ... Malik Ijaz and his wife, Ayesha, bring a son and a daughter to the Bradford classes. Photograph: Christopher Thomond/Guardian

Other responses to our callout came from parents who were worried about schools’ increasingly limited resources due to budget cuts. Much of the additional support that was once available in classrooms is disappearing and some specialist teachers are in short supply. These parents see tutoring as a way of patching the gaps in their children’s education. “It’s only one hour a week, but the practice crammed into that time is like a full week of lessons at school,” said one parent, who is a teacher. “The ability to check every week how well the information is being retained is great. It also provides ‘real-time’ feedback that we don’t get from schools.”

Some parents buy extra tuition to support children with special educational needs such as dyslexia, which mainstream schools are increasingly unable to meet. The new, tougher GCSE exams are also a factor, with some parents hiring private tutors to help children who are struggling to secure the level 4 or above required in English and maths.

One mother from Nigeria said she sought extra support for her child as a practical response to racial discrimination: “Any child from a minority has to be many times better than their white counterparts to be able to get into the top schools and universities.” Another parent told of a daughter with cancer who missed a year of formal education, but got through with the help of a tutor. Another respondent claimed the shadow tutoring workforce “props up” some “outstanding” schools – private, grammar and state.

Not everyone was positive about the impact of tuition. “It can cause students to not work in lessons,” said one teacher. Another said: “The need for tutoring frightens me. Schools should be able to offer students the support they need in class sizes that are manageable.” While one parent said: “I resent it when having a tutor is seen as a class crime,” another acknowledged the unfairness at the heart of the system: “I feel uncomfortable that we can afford to pay for this privilege.”

The callout also revealed the appeal of private tuition for teachers, whose salaries have been depressed for years while the demands upon them have grown. Some said they did private tutoring to boost their income; others, tired of the one-size-fits-all approach in schools, have quit their jobs to do it full time.

Asked about the boom in private tuition, the Department for Education responded that standards are rising in schools and that the attainment gap between rich and poor pupils is shrinking. “While we believe families shouldn’t have to pay for private tuition, it has always been part of the system and parents have freedom to do this,” a spokesman said.

“Tutoring is huge, it’s getting bigger and it’s not going away,” says the Sutton Trust’s Lampl. “You can’t stop people from doing it. What we’ve got to do is make it more accessible for parents who currently can’t afford it.”

Clayton, the retired garage worker from Bradford, is not a rich man, but he wants to invest what he has in his grandson’s future. His hopes for Brooklyn are modest and honourable and shared by parents and grandparents everywhere. “I want Brooklyn to have a good start in life … Nobody gave me a leg up. I’m trying to do something for him that I never got. I hope he ends up being a decent person when he grows up and gets a decent job and doesn’t have to struggle.”

Let’s face it. Our university factory has failed to deliver on its promises

Aditya Chakrabortty in The Guardian







In any other area it would be called mis-selling. Given the sheer numbers of those duped, a scandal would erupt and the guilty parties would be forced to make amends. In this case, they’d include some of the most eminent politicians in Britain.

But we don’t call it mis-selling. We refer to it instead as “going to uni”. Over the next few days, about half a million people will start as full-time undergraduates. Perhaps your child will be among them, bearing matching Ikea crockery and a fleeting resolve to call home every week.

They are making one of the biggest purchases of their lives, shelling out more on tuition fees and living expenses than one might on a sleek new Mercedes, or a deposit on a London flat. Many will emerge with a costly degree that fulfils few of the promises made in those glossy prospectuses. If mis-selling is the flogging of a pricey product with not a jot of concern about its suitability for the buyer, then that is how the establishment in politics and in higher education now treat university degrees. The result is that tens of thousands of young graduates begin their careers having already been swindled as soundly as the millions whose credit card companies foisted useless payment protection insurance on them.

Rather than jumping through hoop after hoop of exams and qualifications, they’d have been better off with parents owning a home in London. That way, they’d have had somewhere to stay during internships and then a source of equity with which to buy their first home – because ours is an era that preaches social mobility, even while practising a historic concentration of wealth. Our new graduates will learn that the hard way.

To say as much amounts to whistling in the wind. With an annual income of £33bn, universities in the UK are big business, and a large lobby group. They are perhaps the only industry whose growth has been explicitly mandated by prime ministers of all stripes, from Tony Blair to Theresa May. It was Blair who fed the university sector its first steroids, by pledging that half of all young Britons would go into higher education. That sweeping target was set with little regard for the individual needs of teenagers – how could it be? Sub-prime brokers in Florida were more exacting over their clients’ circumstances. It was based instead on two promises that have turned out to be hollow.

Promise number one was that degrees mean inevitably bigger salaries. This was a way of selling tuition fees to voters. Blair’s education secretary, David Blunkett, asked: “Why should it be the woman getting up at 5 o’clock to do a cleaning job who pays for the privileges of those earning a higher income while they make no contribution towards it?” When David Cameron’s lot wanted to jack up fees, they claimed a degree was a “phenomenal investment”.

Both parties have marketed higher education as if it were some tat on a television shopping channel. Across Europe, from Germany to Greece, including Scotland, university education is considered a public good and is either free or cheap to students. Graduates in England, however, are lumbered with some of the highest student debt in the world.

Yet shove more and more students through university and into the workforce and – hey presto! – the wage premium they command will inevitably drop. Research shows that male graduates of 23 universities still earn less on average than non-graduates a whole decade after going into the workforce.

Britain manufactures graduates by the tonne, but it doesn’t produce nearly enough graduate-level jobs. Nearly half of all graduates languish in jobs that don’t require graduate skills, according to the Chartered Institute of Personnel and Development. In 1979, only 3.5% of new bank and post office clerks had a degree; today it is 35% – to do a job that often pays little more than the minimum wage.

Promise number two was that expanding higher education would break down class barriers. Wrong again. At the top universities that serve as gatekeepers to the top jobs, Oxbridge, Durham, Imperial and others, private school pupils comprise anywhere up to 40% of the intake. Yet only 7% of children go to private school.Factor in part-time and mature students, and the numbers from disadvantaged backgrounds are actually dropping. Nor does university close the class gap: Institute for Fiscal Studies research shows that even among those doing the same subject at the same university, rich students go on to earn an average of 10% more each year, every year, than those from poor families.

Far from providing opportunity for all, higher education is itself becoming a test lab for Britain’s new inequality. Consider today’s degree factory: a place where students pay dearly to be taught by some lecturer paid by the hour, commuting between three campuses, yet whose annual earnings may not amount to £9,000 a year – while a cadre of university management rake in astronomical sums.

Thus is the template set for the world of work. Can’t find an internship in politics or the media in London that pays a wage? That will cost you more than £1,000 a month in travel and rent. Want to buy your first home? In the mid-80s, 62% of adults under 35 living in the south-east owned their own home. That has now fallen to 32%. Needless to say, the best way to own your own home is to have parents rich enough to help you out.

Over the past four decades, British governments have relentlessly pushed the virtues of skilling up and getting on. Yet today wealth in Britain is so concentrated that the head of the Institute for Fiscal Studies, Paul Johnson, believes “inheritance is probably the most crucial factor in determining a person’s overall wealth since Victorian times”.

Margaret Thatcher’s acolytes promised to create a classless society, and they were quite right: Britain is instead becoming a caste society, one in which where you were born determines ever more where you end up.

For two decades, Westminster has used universities as its magic answer for social mobility. Ministers did so with the connivance of highly paid vice-chancellors, and in the process they have trashed much of what was good about British higher education. What should be sites for speculative inquiry and critical thinking have instead turned into businesses that speculate on property deals, criticise academics who aren’t publishing in the right journals – and fail spectacularly to engage with the serious social and economic problems that confront the UK right now. As for the graduates, they largely wind up taking the same place in the queue as their parents – only this time with an expensive certificate detailing their newfound expertise.

For everyone’s sake, let us declare this experiment a failure. It is high time that higher education was treated again as a public good, as Jeremy Corbyn recognises with his pledge to scrap tuition fees. But Labour also needs to expand vocational education. And if it really wants to increase social mobility and reduce unfairness, it will need to come up with tax policies fit for the age of inheritance.

Visas and global poverty

Rafia Zakaria in The Dawn

IN a recent report, the Centre for Global Development made a surprising and somewhat startling observation. Looking at the data from several recent studies, they noted that even the very best international development programmes to reduce global poverty could only produce outcomes that were 40 times less successful than the income gain people in poor countries experienced when their citizens were provided greater labour mobility. In simple non-economist terms, it means that visas work faster and better to reduce global poverty by a lot than even the very best international development programmes.

The visa, then, with the promise of mobility that it holds, is one of the few single things that has the greatest capacity to eliminate global poverty than anything else in the world.

What is true, however, is not always popular, and this is certainly true of the visa solution. While this may be true, the extent of the discrepancy between the effectiveness of international aid programmes versus work visas is quite alarming. A study published in Science magazine reveals how intensive and highly targeted programmes directed at poor countries like Pakistan and Ethiopia were successful at reducing poverty even if they were far more expensive to implement and produce.

Even so, the mood of the announcement was triumphant; pricey as it may be, their study had found that international aid could work. The fact that work visas and access to labour markets work better was never mentioned.


The international aid system is a moral hierarchy, with the aid grantors at the top.

The omission is not surprising. As another study has noted, the infrastructure of aid depends on hierarchies in which Western experts imported into impoverished environments diagnose how and what poor countries must do to escape persistent poverty. Even while development lingo has evolved to include terms like ‘local involvement’ and ‘community input’, no project is complete without the messenger experts of the West arriving to impart their pearls of wisdom.

Behind all of this, there is a hierarchy at work and it always involves donor countries and their experts being at the top. This is even more visible in public presentations of development work at this or that conference; in one example, noted in the report (but recurrent everywhere), an organiser had to fight to ensure that at least one Arabic speaker be included in a panel on international development in the Middle East and the North African region.

It’s not just panels and experts that are the problem; it is also the impact of these interventions on local populations. Take, for instance, the issue of ‘capacity building’, a term of art deployed when aid is handed out in poor communities but little improvement is seen in their metrics.

At this point, ‘capacity building’ enters to save the day, that is, to introduce skills, such as financial management, entrepreneurship, etc that would hypothetically enable better results and prove the development programmes effective after all. Few of these ‘capacity-building’ programmes actually deliver the promised, improved results.

The reason is simple. Contrary to the assumption that aid grants exist solely to eliminate global poverty in the world’s most wanting populations, the international aid system is also a moral hierarchy. The aid grantors are at the top; they have the most and know the best, but in addition to all that they are also morally superior, willing to grant assistance with little expectation in return. They are the world’s altruists, whose purity of purpose lends them the authority that no others possess. They can pretend that they are doing good while expecting nothing at all in return.

When this moral aspect of international aid and aid giving in general is noted, the international aid system can be recast not as a means of actually helping the poor (because visas and labour mobility would accomplish this with far greater efficacy) but rather a means via which a moral hierarchy is created and maintained — the world’s wealthy, also the world’s noblest, inhabiting its summit, and the wanting at the bottom.

Seen against this, the purpose of development programmes may not actually be to reduce poverty or eliminate it but rather to enable the continued existence of this moral hierarchy. Per its dimensions, the world’s poor are not simply to be pitied but also morally wanting, often too lazy or devoid of initiative to figure out how to lift themselves out of their hapless circumstances. They are the ignoble, always awaiting alms from the good and noble.

Permitting some programme of labour mobility would dismantle this structure, whose moral currency permits the West to justify wars, trade restrictions and so much else that enable the maintenance of Western dominance. Research shows that an individual’s own desire to change his or her circumstances, one that aligns with the provision of work visas, is the best predictor of success in escaping poverty. Even while development professionals create metrics for this and that, measure effectiveness through complex statistical models, these basics that show a better route than the system of international aid are ignored.

Even while virtual platforms of communication enable organisation and discussion across national and continental boundaries and time zones, even as jet travel puts the world at our disposal and makes movement across borders a regularity, Western countries continue to rely on the archaic premises that borders are real, racial and religious difference are threats and the basis on which opportunities are distributed. It is not the lack of capacity or initiative among farmers in sub-Saharan Africa or shepherds in Ethiopia, then, that explain the persistence of global poverty, it is the inability of these people to travel freely to work where the jobs are.

A civilised society supports people in need, but our brutal system shatters lives

Aditya Chakrabortty in The Guardian



Simon’s death certificate tidies away his life in a few terse official phrases. Date of death: 12 November 2017. Causes: “a) Fatty liver” and “b) Alcohol misuse”. No bureaucratic curiosity about how a 51-year-old’s life came to be cut so short.

Which leaves his only brother, Dave, dealing with the grief and asking all the whys. Why did Simon die so young? Why did no one else try to help?

No obituaries will be written for Simon, no plaques mounted, no tributes passed by politicians. But if you want to understand how Britain fails so many people in so many places, it’s stories like his you need to study.

Some people’s lives are like arrows, flying straight to their destinations. Not Simon’s. The Rhymney Valley, in south Wales, is where he was born and died, but it wasn’t where he spent most of his adult years, and it was never where he meant to land up. Bright boys, he and Dave had one notion drummed into them: get an education, and get out. On TV, Dave remembers, “We’d see the yuppie revolution going on in London – the Porsches and the red braces. It may as well have been another country.” For them, Thatcher meant mines closing, factories shutting, men being laid off in their thousands, and families going under.


Yet there are so many people like Simon, all surplus to requirements of this shrunken economy


Both sons flew away. Simon was the high-flyer, leaving Wales to do a science degree, going to Cambridge for postgraduate study, and becoming a software engineer with a giant defence firm. He married and settled far away, in Bushey, on the outskirts of London. He had got on his bike; he had looked for work. Now he was earning three times what his younger brother was making, and raring to join the yuppies.

Just as he was starting to live the dream, the dream fell to bits. He got divorced. He got laid off. Then their mother’s breast cancer returned – this time for good. The prodigal son moved back, moved in, and became her carer. Dave doesn’t remember him complaining once during the years their mother spent deteriorating and then dying.

Such setbacks await all of us, but one test of any civilised society is how well it supports us through them. In Simon’s case, Britain botched this test – over and over again. By the time his mother died, he had spent seven years outside the job market. It was 2007, the start of the credit crunch, and the economy was slowing. Even in boomtown London such a gap on the CV would have raised recruiters’ eyebrows. Here in south Wales, where jobs were already scarce, it was the kiss of death. Besides, it simply did not have positions for Si, with his Cambridge postgrad and software engineering background.

Simon “spent 25 years building up to be somebody”, says Dave. A quarter-century observing the social mobility rules laid down by Margaret Thatcher and Tony Blair. He had aspired, he’d grafted, he’d kept his side of the bargain. But while social mobility trumpets opportunity for individuals, it ignores the communities where those people live. The result was that Simon’s ambitions had outgrown his home, and now he was trapped.

Dave showed me the small terrace house their mother passed on to Simon, where he spent the last years of his life. No one was about as we walked through the speck of a village – just two long rows of cars parked outside the train station. This is the new Welsh commuter class that economists such as Cardiff University’s Calvin Jones talk about, the people who travel from the valleys to staff the call centres, shops and other minimum-wage employers in Cardiff or Newport.

Governments in Westminster and Cardiff Bay have spent decades promising to rebuild the shattered economy of south Wales. Serious money has been spent on shopping malls, new motorways and sweeteners for big business. Each time, the firms come, take the cash and – at best – leave a few poverty-paying jobs. You see the same cycle in so many deindustrialised parts of Britain. And each time, the politicians learn no lessons, and try the same thing again.
A few minutes from Simon’s old home is the town of Bargoed, where the greatest excitement in recent years was the opening of a Morrisons. Much of the rest of the high street is just memories: a huge statue to commemorate dead miners, the chapel turned into a library, and shop after shop with its shutters pulled down for good.

A rural bus services in Fochriw village, Bargoed. South Wales is one of the poorest regions of the UK. Photograph: Martin Argles for the Guardian

Simon signed on at the jobcentre, which told him to apply for 35 jobs a week. He sent off to become a teaching assistant, a warehouse operative, all the minimum wage jobs going. Barely an application led to an interview. Sometimes, “angry and very down”, he’d miss his targets or appointments. He would get sanctioned, go broke, and have to call on Dave to tide him over.

After years of knockbacks, Simon declared he’d never be able to work again. It came almost as a relief. “It meant he didn’t have to think of himself as such a failure. Now he could be a victim.”

Simon had always been a pub man. But now he’d get up in the morning and start on a glass of watered-down scotch and a sci-fi DVD. By the end of a day, he’d have finished the DVDs, his fags and an entire bottle of Scotch. Why does Dave think no employer wanted him? His answer comes back in a small, tight voice. “No one wants a 50-year-old, unemployed, overweight, drinking guy on the books, do they?”

Yet there are so many of them, all surplus to the requirements of this shrunken economy. A GP in Bargoed estimates that up to one in 10 of her patients have some kind of drink or drug addiction. Up to one in three suffer depression or anxiety. In these parts, a newborn boy can expect to live just over 61 years in good health; in the richest parts of London, it’s 75 years.

Having been one of Blair’s strivers, Simon was now one of George Osborne’s skivers. He was moved on to disability benefits, before the Department for Work and Pensions assessors declared him fit for work. His money would periodically stop until his GP contested the verdict. This spring, he was moved on to universal credit, which meant six weeks with barely a penny. Again and again, it was Dave who had to bail him out. It was Dave who suggested jobs Simon could apply for, small businesses he might start. The younger brother was filling in for the state, while Si lived in ripped clothes and ate junk. “The government was abusing a vulnerable man.”

Alcoholic Simon would go to the local NHS drink service once every few weeks – and every few months, he’d end up in such a bad state he would be admitted to hospital. They’d “dry him out, then spit him out”, says Dave. According to the thinktank the Nuffield Trust, the Welsh health system is underfunded by £500m a year.

Simon died in his small house, waiting to go back into hospital to dry out. He grew up in a town with men who’d had to dig out children from the Aberfan mining disaster; he died the year Grenfell Tower burned down. When such obvious tragedies strike, the politicians and the press vow to tackle the social injustices that caused them. But Simon was just one man dying in plain sight of his neighbours, his family and state officials. Far easier to chalk up his death to a fatty liver and booze, rather than inequality and austerity and the false promises peddled by politicians from Thatcher to May. A dead man, a dying town: he spent his last days being told he’s fit for work in an economy that has next to no work.
What’s left is a younger brother beating himself up about what he should have done and angry at others for letting them both down.

Before we part, Dave asks: “Why wasn’t there someone who could step in and help? Is that naive of me? To think that a modern, 21st-century society could do that for people who need it?”

The names in this piece have been changed and details obscured in order to protect the identity of Simon’s family

Property feeds the roots of inequality in Britain. Inheritance will entrench it

Ian Jack in The Guardian

What did our grandparents leave us? That will depend on who they were and what they possessed, but in my case, not untypical of my generation, it wasn’t very much.

From my father’s side the treasures included: a stuffed canary; a tiny stuffed crocodile (a gharial, taken from the Ganges); some crested china bought in seaside resorts; and a canteen of excellent cutlery given as a wedding present in 1899 and never taken from its box. On my grandmother’s death, a display cabinet was bought to accommodate this sudden Victorian infusion into our household, which already had a fine little portrait of Rob Roy inherited from my mother’s father, to be followed much later (after a diversion to an aunt and then a cousin) by a wall-clock and a watercolour of a street in Kirkcaldy that looked very pretty from a distance. I’m sure to have forgotten other items – for example, I’m just now remembering the 78rpm discs of Enrico Caruso and Harry Lauder – but basically that was it.

If there was money, there was very little. No property, you see. Neither side of the family had ever owned a house – and so, in terms of material changes to their children’s lives, their deaths were inconsequential. I, on the other hand, do own a house. More than that, I own a house in London. My death, and that of a million like me, will be very consequential.

According to Steve Webb, policy director of the Royal London mutual insurance company, “a wall of housing wealth [is] set to cascade through the generations in the coming years”.

A study published this week by Royal London estimates that roughly £400bn presently tied up in homes owned by people aged 65 to 85 will be handed down to their children and grandchildren. A typical estate of what the study calls this “wealth mountain” is worth between £400,000 and £500,000, to be shared out between four or five children or adult grandchildren and often to be reinvested in property.

The study is based on a YouGov survey of more than 5,600 people covering three generations: the so-called “grandparents generation” of 65- to 85-year-old homeowners; the “sandwich” generation of parents aged 45 to 64, who have living parents from whom they might expect to inherit; and a “children’s” generation of adults aged 25 to 44 who have owner-occupier parents and grandparents.

Surveys are only surveys: caveat emptor. Nevertheless, the report discovers some intriguing differences between generations. While the youngest group believes that their grandparents should spend freely to enjoy their retirement, the grandparents themselves think it right to hoard their money for their grandchildren. Many don’t wait to die. A third of those aged 75 and over had given sizeable sums of money to their grandchildren, a generation that according to the study’s calculations have received a total of £38bn from both their parents and grandparents – often, especially in London and the south-east, to spend on property. And while grandparents tend to act out of a sense of distant benevolence, parents are responding to the “pressure” exerted by their children’s predicaments. The study’s title picks up this theme: Will harassed “baby boomers” rescue Generation Rent?

Earlier this year, the Institute for Fiscal Studies published research on the growth of inheritance as a phenomenon in British life. It showed how less than 40% of the cohort born in the 1930s have received or expect to receive a bequest, while for those born in the 1970s the figure is 75%. Their benefactors are on average much richer. In 2002-3, the household wealth of people aged 80 and over averaged £160,000; 10 years later, thanks mainly to increases in home ownership and house prices, the average had risen to £230,000.

So far, the impact of inheritance on entrenching or heightening inequality has been fairly small – the average inheritance equals only 3% of the other income its recipient can expect to generate in a lifetime. But neither the Royal London nor the IFS study expects that to last. “We are entering an unprecedented era where the older generation is retiring with vast housing wealth,” says the first in its final paragraph. “That wealth is largely being preserved through retirement and will in due course find its way down through the generations. Public policy making needs to take far more account of these very substantial financial flows and perhaps focus more attention on those who are not likely to be the beneficiaries.”

In other words, we are re-entering the world of the Victorian novel, in which suitable marriages, contested wills and misplaced legacies drive the plot, while the poor – the people without lawyers – press their faces against the window of this vigorous, scheming world and merely invite our sympathy.

It wasn’t supposed to happen. “Come with us, then, towards the next decade,” said Margaret Thatcher, winding up her speech to the Conservative party conference in 1985. “Let us together set our sights on a Britain where three out of four families own their home, where owning shares is as common as having a car, where families have a degree of independence their forefathers could only dream about.”


Anyone under the age of 45 is now much less likely to be a homeowner than people of the same age 25 years ago

Two years later the writer Neal Ascherson wrote a prescient column in the Observer that he recalls as “the most popular column I ever wrote … It was greedily read by the yuppie generation – and then fiercely denounced for being wrong.” Foreseeing that soaring house prices meant that London’s middle-class young would inherit many millions when their parents died, Ascherson predicted an “explosion of liquid wealth that would create instant and colossal inequality”: a society with an upper class rich enough to maintain servants, in a “court city” drained of industry that had reverted to the production of luxurious baubles.

Economists pointed out that the cash raised from property sales wouldn’t be “liquid” – it would be sucked up by the inflated cost of the new houses the inheritors moved into – but from today’s vantage point Ascherson’s futurism does not look so wrong. A new super-rich class with butlers and housemaids has moved in, though mainly from overseas rather than Britain, while owner-occupation has become a mirage for growing numbers of the less well-off.

Homeownership today stands just slightly above the rate when Thatcher made her speech: 64% of all households compared with 61% of all households in 1985, having declined from a peak of 71% in 2003. Anyone under the age of 45 is now much less likely to be a homeowner than people of the same age 25 years ago, while the reverse is true of older age groups.

Private renters account for more than 20% of the housing market; in 1985 the figure was 9%. High rents rule out the kind of savings needed for a deposit on a house – with an average price in London equivalent to more than 16 times the average London salary, and 12 and 13 times the mean income of people in their 20s and 30s in prosperous cities such as Cambridge and Brighton. Meanwhile prices, which might be expected to slump amid the economic uncertainty of Brexit, have instead held reasonably steady because the fall in the value of sterling has made them more attractive to international investors.

As the IFS says, these developments mean that inherited wealth is likely to play a more important – I would say crucial – role “in determining the lifetime economic resources of younger generations, with important implications for inequality and social mobility”. What can grammar schools do – supposing they really are agents of social mobility – against this coming weight of money, which will deepen privilege like a coastal shelf? The metaphor is borrowed from Philip Larkin. “They set you up, your mum and dad. They say they mean to, and they do.” For some of us, This Be the Verse.

Telling children 'hard work gets you to the top' is simply a lie

Hashi Mohamed in The Guardian


I know about social mobility: I went to underperforming state schools, and am now a barrister. Could somebody take the same route today? It’s highly unlikely

‘Those inside the system naturally recruit in their own image. This then entrenches the lack of any potential for upward mobility and means that the vast majority are excluded.’ Photograph: Mick Tsikas/AAP


It is a common promise made to the next generation. “If you work hard, and do the right thing, you will be able to get on in life.” I believe that it is a promise that we have no capacity to fulfil. And that’s because its underlying assumptions must be revisited.
Imagine a life living in quads. You attend a highly prestigious school in which you dash from one quad to the next for your classes. You then continue on to yet another prestigious institution for your tertiary education, say Oxford or Cambridge University, and yet more quads with manicured lawns. Then you end up in the oasis of Middle Temple working as a barrister: more manicured lawns and, yes, you guessed it, more quads. You have clearly led a very square and straight life. Effortlessly gliding from one world to the next with clear continuity, familiarity and ease.

Now contrast the above oasis with the overcrowded and under-performing schools of inner cities, going home to a bedroom which you share with many other siblings. A home you are likely to vacate when the council can’t house you there anymore. Perhaps a single-parent household where you have caring duties at a young age, or a household where no one works. A difficult neighbourhood where the poverty of ambition is palpable, stable families a rarity, and role models very scarce.


The unwritten rules are rarely shared and 'diversity' and 'open recruitment' have made little if any difference


The former trajectory, in some or all its forms, is much more likely to lend itself to a more successful life in Britain. The latter means you may have the grades and talent, despite the odds, but you’re still lacking the crucial ingredients essential to succeeding. I don’t have to imagine much of this. I have experienced both of these extremes in my short lifetime.

My mother gave birth to 12 children. I arrived in London at the age of nine, speaking practically no English. I attended some of the worst performing schools in inner-city London and was raised exclusively on state benefits. Many years later I was lucky enough to attend Oxford on a full scholarship for my postgraduate degree. Now as a barrister I am a lifetime member of The Honourable Society of Lincoln’s Inn.

Is my route possible for anyone in the next generation with whom I share a similar background? I believe not. And this is not because they are any less able or less dedicated to succeed.

What I have learned in this short period of time is that the pervasive narrative of “if you work hard you will get on” is a complete myth. It’s not true and we need stop saying it. This is because “working hard, and doing the right thing” barely gets you to the starting line. Furthermore, it means something completely different depending on to which context you’re applying this particular notion. So much more is required.

I have come to understand that the systems that underpin the top professions in Britain are set up to serve only a certain section of society: they’re readily identifiable by privileged backgrounds, particular schools and accents. To some this may seem obvious, so writing it may be superfluous. But it wasn’t obvious to me growing up, and it isn’t obvious to many others. The unwritten rules are rarely shared and “diversity” and “open recruitment” have tried but made little if any difference.

Those inside the system then naturally recruit in their own image. This then entrenches the lack of any potential for upward mobility and means that the vast majority are excluded.

As a form of short-term distraction, we are obsessed with elevating token success stories which distort the overall picture. The story of the Somali boy who got a place at Eton, or the girl from the East End who is now going to MIT. These stories may seem inspiring at first blush, but they skew the complex picture that exists in deprived communities. It perpetuates the simple notion that what’s required is working hard, and that all else afterwards falls neatly into place. This simple ritual we seem to constantly engage in is therefore as much about setting up false hopes for other children, as it is about privileged, middle-class-led institutions making themselves feel good.

The reality is that there are many like them trying hard to do better, but may be lacking the environment to fully realise their potential. Are they worth less? When told to “dream big” and it will happen, who will tell them that failure had nothing to do with their lack of vision? But that real success, especially from their starting point, often boils down to a complex combination of circumstances: luck, sustained stability, the right teachers at the right time, and even not experiencing moments of grief at crucial, destabilising junctures.

Improving educational attainment is critical, and so much progress has been made over the years to improve this. But this is not enough. Employers must see hiring youngsters from poorer backgrounds as good for business as well as for a fairer society. They must be assisted with a real chance to succeed, in a non-judgmental context and inclusive environment. They must do more to focus on potential rather than polish. More leadership and more risk-taking are required on this front.
Perversely, class and accents remain an overwhelmingly important way of judging intelligence. In France or Germany, for example, your accent rarely matters. Your vocabulary and conjugation will give much more away, but never your accent, apart from regional perhaps. I don’t see this mindset shifting, so my advice to youngsters has remained: you need to adapt yourself. You need to find the right way to speak to different people, at different times in different contexts. This is not compromising who you are, but rather adapting to the relevant surroundings.

We need to do more to double down on improving environments both at home and at school which continuously constrain potential. If the adage that hard work truly matters rings true, then we must do more – at all levels of society – to make it a reality.

Theresa May has some cheek going cap in hand to India, an ex-British colony, for a post-Brexit deal

Harriet Williamson in The Independent


Theresa May is visiting India this week cup in hand, to ask for a favourable post-Brexit trade deal. There’s arrogance in May’s return to Britain’s former colony, expectant that India will come up with the goods, but ultimately, the move shows how much the tables have turned.

Many people, particularly in my grandparents’ generation, still view British imperialism and empire with a dewy-eyed longing. The reality is, of course, that British rule in India caused the deaths of millions of people through administrative failure and imperialist cruelty. Numerous famines, outbreaks of cholera, the arbitrary and rushed drawing of the border between India and the newly-created Pakistan, mass-displacement, and the destruction of India’s cottage industries left the country impoverished and unstable.

Imperialism set India up as both Britain’s workhouse and convenient marketplace, and when India finally gained independence, it was reduced to one of the world’s poorest economies. For Britain to come begging now that we’ve made such a mess of things with our yet-undefined Brexit, opposed by 48.1 per cent of the electorate, is laughable.

Although a number of the more vehemently right-wing newspapers chose to focus on May’s ‘hardball’ stance on immigration during her visit, they didn’t pick up on the incongruity of the Prime Minister haggling over “Indians with no right to remain in the UK” whilst hankering after a lucrative trade deal.

At a tech summit in Delhi, May was pressured by business leaders including Sir James Dyson and Karan Bilimoria, founder of Cobra beer, to welcome more skilled Indian workers and students to Britain. The Government’s current position seems to involve the hope that India will still sign a cushy deal with us, while we crack down on Indians in Britain who’ve outstayed their frosty welcome.

The political conversation in Britain has, despite the influence of Corbyn, shifted perceptibly to the right. May knows that to keep the would-be-Ukippers and Brexit-devotees onside, she must act ‘tough on those foreign people’ despite surely recognising that she cannot turn back the clock on globalization.

The isolationist, shut-the-door sentiments that brought us Brexit are not going to serve Britain well when it comes to making international trade agreements, and to belief otherwise is a self-important indulgence that we can no longer afford. We live, for better or worse, in an interconnected world, and the issue of migration cannot be wiped off the table during trade discussions.

India wants access to the UK labour market for skilled workers, and the UK government wants to pander to the narrative that immigrants are an unnecessary scourge on our increasingly less green and pleasant land. On the basis of this impasse, a free trade agreement seems like a childish fantasy.

I wouldn’t blame India for putting up two fingers to Theresa May and Britain.

Politicians must grasp the difference between free market and corporate stitch-up - or face popular rage

Janet Daley in The Telegraph

Does anybody in the governing business actually understand political ideas anymore? Or, to be more precise, is there any interest in what constitutes a real political position as opposed to a desperate scramble for tactical advantage? You will gather from the wording of these questions that they are rhetorical.

Almost nobody in the professional political class seems to me to have the remotest idea of what constitutes a coherent argument involving the basic equipment of consistent principles and rational conclusions. Oddly, this judgment applies most of all to the revivalist Labour party, whose leadership presents itself as being more purely ideological and avowedly principled than any in living memory.

The morass of confusion and self-contradiction is most clearly illuminated in the messy, ever more vindictive, debate about Brexit which, in fact, can scarcely be dignified by the name “debate” since there is no agreement about what would constitute winning. Some of this is the result of deliberate obfuscation and dishonesty around the specific question of ending our membership of the European Union.

But there is a larger void too. In fact, some of the most difficult points about the exhaustively disputed advantages and disadvantages of the EU could be brought into luminous clarity if the parties involved understood (or stopped pretending that they did not see) the obvious political lessons.

The most fundamental facts of economic and governmental life are being scrambled, obscured and blatantly misrepresented in ways that are designed to make sensible discussion virtually impossible. And it is not just in cynical old Europe where this crime is being perpetrated: the American presidential election is making a grotesque nonsense of the issues that might provide some understanding of what is at stake for the country.

But let’s look first at the EU farrago since the perversity and deceptions here are so blatant. Surely suspicion should have been raised when it became apparent that the most fervent opposition to Leave, and the most militant opposition to the referendum result, came from an unlikely alliance between political Left-liberals and global corporate interests.

It was perfectly understandable that, in a shameless display of brazen self-interest, international corporations which dominate the globalised economy should be in favour of a system that would tear down borders and allow them untrammelled access to as big a unified trading bloc as possible. For what we used to call, back in the day, “corporate capitalism”, the EU is very heaven.

Here in a package deal is a bloc of countries trussed up in regulation that puts smaller competitors out of business, and is ready to provide an infinite supply of cheap labour which can be shunted around the continent without restriction. What’s not to like?

If you were wondering where all that passionate advocacy for a repudiation of the referendum vote was being generated, just remember that there is a great deal of investment (which is to say, money) at stake here. (Did you really think this was all about idealistic devotion to the communaitaire European vision?) The destabilising of the EU arrangement presents a threat to the hegemony of some of the most powerful manipulators of capital in the world. So I get it: I understand what that well-organised campaign is about.

This is manipulation of public opinion by what should be a clearly identifiable, self-serving source to protect its own vested interests. What I do not understand is why anyone who regards himself as being on the Left or even the centre-Left – indeed anyone who professes sympathy with what we might call “little people” (ordinary working families or aspiring entrepeneurs) – should be pitching in with such gusto.

The EU is a club that celebrates the power of Big Leagues: Big Business, Big Government, and Big Bureaucracy. To a much lesser extent, it grants power to Big Labour in the form of the most well-connected trade unions, but this is very much on sufferance: any union that put up serious resistance to the transporting of cheap labour – which is what the “free movement of people” should properly be called – would find itself outside the magical sphere of influence very quickly.

Incendiary discontent will not be defused by any election unless there is a serious attempt to talk properly about the commodification of labour

But how can it be morally worthy for the Mediterranean countries which have youth unemployment rates of around 60 per cent, and the eastern European countries which are struggling out of post-Soviet poverty, to lose the best and brightest of their young to the rich established economies of western Europe? What kind of freedom is that?

It’s a dream for ruthless international businesses for whom local community ties and historic roots are a nuisance at best and a major obstacle at worst but it further impoverishes the poorer countries and makes conditions of employment impossible for all but the most nomadic and adaptable.

Most significantly at the moment, it creates impossible tensions with the indigenous workforce who do not have the mobility or the minimal personal responsibilities of that transient labour army which employers find so very useful. As this column has noted before, this is an almost perfect example of what Marx called the “commodification of labour”. It has become the most febrile component of the electoral politics of Britain and the United States: the incendiary discontent which will not be defused by any election in the foreseeable future unless there is a serious attempt to talk about it properly.

At this point, regular readers may be tempted to conclude that I am regressing. My account must sound conspicuously like that of the young Marxist I confess that I once was. But the Left’s failure to acknowledge what should be staring it in the face is not the whole story.

What should be central to any real argument about the globalisation of labour – because that is what the electoral hot potato of immigration actually means – is that it is very different from the kind of economic freedom that is of genuine benefit to the people of the world. Free markets and free trade have produced mass prosperity on a scale that is unprecedented in human history: not just prosperity in the crass material sense but self-determination and self-fulfilment of a kind that was once available only to the wealthiest and most privileged individuals.

In the developing world, free-market economics and the lowering of trade restrictions have wrought miracles, bringing whole swathes of Africa and Asia out of poverty. Now all this is in danger of ossifying with the US and the EU likely to block entry not only to emerging markets and small, flexible entrepreneurs but even to major countries: the long-negotiated EU trade agreement with Canada has just collapsed, absurdly, due to a veto by one small Belgian region.

Even self-styled progressives in the West are now endorsing this retreat from open markets. Hillary Clinton is pulling away from free trade commitments in her eagerness to placate indigenous working class voters who are lured by Trumpist xenophobia. So she veers more and more toward protectionism and high-tax government when the only true antidote to economic stagnation is the opposite of those. What she and Theresa May need to offer is a new political settlement in which the indispensable role of free trade is accepted alongside protection against the unlimited imported labour which leads to social unrest.

In Britain, too many Conservatives who ought to know better confuse monopolistic corporate interests with free markets, and refuse to recognise the difference between national sovereignty and nationalism. Maybe some politicians here and in the US do understand all this. It’s difficult to tell because there is so little grown-up discussion. Meanwhile ordinary people believe they are being forgotten or deliberately shafted by a conspiracy of the powerful: global corporates, international money, and self-aggrandising super players. Are they wrong?

I hate Trump and Farage. But on free trade they have a point

Aditya Chakrabortty in The Guardian

Globalisation, as can be seen from the TTIP and Ceta deals, is about protecting big business – against the public. No wonder voters in the US and Europe are turning to populists.

 

Illustration by Andrzej Krauze





How they frown. How they fulminate. How they threaten. For decades, presidents and prime ministers, policymakers and pundits have told voters there is only one direction of travel: free trade. Now comes Brexit and Donald Trump – and the horrible suspicion that the public won’t buy it any more. This is how an elite project falls apart. And the elites don’t know what to do, apart from keep insisting the public listen.

In Washington last month, you could barely move for wagging fingers as the heads of the IMF, the World Bank and the World Trade Organisation warned that free trade was in mortal danger. In Ottawa last week, Canadian prime minister Justin Trudeau surveyed the hundreds of thousands of Europeans demonstrating against the continent’s treaty with his country and said: “If… Europe is unable to sign a progressive trade agreement with a country like Canada, well, then with whom will Europe think that it can do business in the years to come?”

Their outriders in the press have dropped the pretence of liberal politesse for red-cheeked self-righteousness. The hairy-palmed hordes are coming for our internationalism! As if internationalism were little more than business-class flights and the freedom to structure derivatives across several time zones. The Economist slaps an image of anti-globalisation demonstrators on its cover with the headline: “Why they’re wrong”. Note that use of “they”, with its shadow of the drawbridge being hastily pulled up. Coming soon, perhaps: “Why can’t we get the 99% we deserve?”

I heartily agree that Nigel Farage and Trump are grotesques. But the free-traders peddle their own untruths. They have insisted that black is white, even as the voters beg to differ. In their seminar rooms, their TV studios and their Geneva offices, they have perpetrated the ideological sleight of hand that equates internationalism with free trade, and globalisation with untrammelled corporate power. The result has been misery for workers from Bolton to Baltimore to Bangladesh. But it has also left the six-figure technocrats who supervise our economic system pushing a zombie idea. Because that is what free trade has become: an idea leached of life and meaning but stumbling on for want of any replacement. We have a globalisation for bankers, but not for children fleeing the bombs of Syria. Security for investors but not for workers.

To see how debased the notion of free trade has become, look at the deal between Canada and the EU that is currently being voted through Europe’s parliaments. It’s called the Comprehensive Economic and Trade Agreement (Ceta), and the fact that you can see it at all is largely down to leaks of the documents, which forced the European commission to publish,. That is after the negotiations were conducted for five years in secret, with even the directives kept hidden from the hundreds of millions of citizens affected.

This is no minor technical work. Provided it is passed in time, Ceta will apply to Britain too – and parts of it will affect Britons’ lives even after we’ve “taken back control”. It has been billed as “a backdoor for TTIP”, the Transatlantic Trade and Investment Partnership, which collapsed this summer amid public opposition both in Europe and the US. Like TTIP, Ceta includes the investor-state dispute settlement system – which hands big business the power to sue governments, including for profits they haven’t made yet. A US multinational with an office in Canada (nearly all of them) will be able to sue Britons for bringing in laws that lose them money. This was the mechanism tobacco giant Philip Morris used to sue Australia’s government for bringing in plain packaging. On that occasion, Big Tobacco was unsuccessful – but it took four years of expensive legal battle.

Free trade used to be about tackling protectionism; now it’s about protecting big business – against the public. If populists take a complex situation, offer a simple answer and warn any dissenters of gruesome consequences, then the free-traders are guilty of populism too. With Ceta or TTIP, it goes like this: if this deal goes through, then economies will grow, jobs will appear, and a rising tide will lift all boats, from super-yacht to rubber dinghy. That is pretty much what mainstream politicians of Europe – both left and right – and their officials are saying about the deal with Canada.

In economic history, never mind that the biggest winners – whether the US in the early 1900s or China now – are those who break the free trade rules. Never mind that the actual forecasts for Ceta show the gains will be relatively meagre. Never mind that the studies cited don’t bother to look at who wins and loses, and by how much.

Most of all, ignore their shared assumption that after any deal the affected economies undergo a short, sharp shock before bouncing back. Anyone’s who has lived through the past eight years has heard that one before. After the financial crisis, the Bank of England and Treasury both kept forecasting a return to normal – and they kept getting it wrong. Eight years on, that bounceback hasn’t materialised. British workers are still not paid as much after inflation as they were when Lehman Brothers collapsed.

That assumption’s lack of substance is called a “dirty little secret” by two independent economists, Pierre Kohler and Servaas Storm, in a recent paper scrutinising the likely effects of Ceta. As they say, it presumes that laid-off workers “will rapidly find new jobs” – whatever the industry, however far away the employer. A car engineer can up sticks and turn into a software engineer. And if there aren’t any actual jobs, they can deliver takeaways for Deliveroo.
The assumptions are both laughably far-fetched and, in the cost citizens are expected to bear, disgusting. No wonder the EU would rather there was as little public discussion as possible.

Using a model employed by the UN, Kohler and Storm found that the benefits of Ceta become microscopic next to the costs. For at least the first seven years after the agreement is brought in, unemployment will rise, wages will fall and economies will see their growth rates decline. Governments will lose revenue, and so increase austerity.

The burden will fall hardest on the poorest, the lowest-skilled, older people and those with disabilities. A senior lecturer at Delft University of Technology, Storm summed up for me the consequences: “The weaker your position in an economy, the more strongly you’ll feel the fall-out.” These aren’t people and regions who are left behind: they’ve been chucked off the train by their own governments. This is the settlement free-traders, left and right, are fighting to impose on voters. Is it any wonder the voters keep plumping for alternatives – no matter how reprehensible, how ruinous?

What the great degree rip-off means for graduates: low pay and high debt

Aditya Chakrabortty in The Guardian

 

‘Ministers needed to sell universities to teenagers and their families – and in the process they have mis-sold them.’ Illustration: Bill Bragg



A few years back, I got my knuckles rapped by a government minister. In public. It was 2010: David Cameron had just come to power, and he was about to thrust university students into a new regime of higher tuition fees and debt.

Against that backdrop, I’d written a column criticising the way in which both Labour and Conservative governments marketed degrees as being some kind of social-mobility jetpack, zooming their wearers to more money and high-powered jobs. It was no such guarantee, I said, citing among other things Whitehall’s own plunging estimates of how much more graduates earn over a lifetime. Graduates, I said, would “probably end up doing similar work to their school-leaver parents – only with a debilitatingly large debt around their necks”.

For David Willetts, then universities minister, this was sheer and unpalatable sauce. In a speech to the annual conference of Universities UK, representing the top management of higher education, he named me – then tried to shame me. I was “wrong”, he claimed. Previous governments had indeed claimed that a graduate could expect to pull in £400,000 more over their lifetime than someone who hadn’t been to university. And, yes, his officials had knocked that estimate down to £100,000. But the difference, you see, was nothing to do with the increase in graduates – but “an improved methodology”. So I was “not comparing like with like”. Two Brains, one slap!

Willetts has since left parliament and gone to a far, far better place: the Resolution Foundation, an inequality thinktank that does much better work than the coalition government ever managed. But looking back, I shouldn’t have been surprised by either the reproof or the forum in which it was made. To sprinkle even a little doubt over the instrumental value of a degree is to take on both the well-paid managers of our universities, and Whitehall orthodoxy.

Higher education is “a phenomenal investment”, Conservative ministers tell us – even with tuition fees at nine grand a year. Repayments are only the equivalent of one “posh coffee” a day, according to the then universities minister Greg Clark (who is now communities secretary). “I think people recognise that that is a phenomenal investment,” he said. “It’s not just a good investment for the student, but actually it’s a good investment for the taxpayer.” I’ve seen ads on daytime TV for loans that do a softer sell than that.

And the marketing is still wrong. Take a look at research published last week by a team of economists from Cambridge, Harvard and the Institute for Fiscal Studies. They found that at 23 universities men typically earned less even 10 years after graduating than their counterparts who’d never been. The disparities are so yawningly wide that it makes a nonsense of talking about the “graduate premium”.

A student of economics at the LSE may walk into a City job and very soon be earning six figures. Their life and career will be utterly different from someone doing business studies, say, at a post-1992 university close to home in the north-east, and then chooses to work in the same area. Yet both are deluged with the official and industrial marketing that a mortar board and gown is worth an extra £100,000 over a lifetime.

Both New Labour and the dwindling band of Cameronian Conservatives have peddled the line that higher education breaks down class barriers. Again, untrue: last week’s research shows that students from the richest families did better than everyone else in the graduate job market – and earned far more than even those who’d done the same course at the same university at the same time.

Ministers needed to sell universities to teenagers and their families – and in the process they have mis-sold them. In this new world of tuition fees and debt, children and their parents have been assured that degrees earn big salaries. At the same time, voters have been told that higher education brings social mobility. Both claims have been made far too broadly – and the losers are those now coming out of university with 50 grand owing to the student loan company, a socking great overdraft and the discovery that internships and coffee shops are the only prospects.

I and others have argued down the years that there is no point in creating more graduates unless you have more graduate-level jobs. Such a position strikes me as being so obvious as to be crass, but it has been ignored by successive governments.

The result can be seen in research published last August by the Oxford economists Ken Mayhew and Craig Holmes. They found that the UK now has proportionately more graduates than any other rich country bar Iceland – yet uses their brains much less than most other countries: the “underutilisation” of graduates – at work but not using their skills – is higher in the UK than anywhere in the EU bar Romania, Greece, Croatia, Latvia and Slovenia.

So what are our graduates doing? Jobs that previously didn’t need a degree. Over one in 10 childminders (11.5%, according to the 2014 Labour Force Survey) are graduates. One in six call-centre staff have degrees, as do about one in four of all air cabin crew and theme-park attendants. In a labour market flooded with graduates, picky employers are now able to take the CVs boasting a university education. And so any young person who didn’t go to university now stands to be treated as a second-class employee.

And universities – with the connivance of their vice-chancellors and marketing departments – have allowed themselves to be sold to the public largely as CV-finishing schools. It is a gross act of vandalism to have committed on a higher education system that the rest of the world once admired. And it has displaced all the other values that accrue both to the individual and to society from education. Critical thinking, public knowledge? You won’t get much change for those from a government that plans to gag academics from using their publicly funded research to question public policy and hold politicians to account.

As for Willetts, he owes me an apology. But nothing like as big as the one he and his colleagues owe to tens of thousands of university graduates, stuck in low-paying jobs that don’t use their expensively acquired skills and certainly don’t pay off their vast debts.

Bernie Sanders and Donald Trump look like saviours to voters who feel left out of the American Dream

The Harvard moral philosopher and author of the highly acclaimed What Money Can’t Buy Michael Sandel in The Guardian  examines the febrile mood of his nation

‘Donald Trump has defied conventional wisdom by challenging the complacencies of the political establishment.’ Photograph: Ethan Miller/Getty Images




The tumultuous early months of the US presidential primaries reflect a populist moment in American politics. Among Democrats, Bernie Sanders, the only self-proclaimed socialist in the Senate, has shown surprising strength against former secretary of state Hillary Clinton, who was expected to win the Democratic nomination virtually unopposed. Among Republicans, Donald Trump, the billionaire businessman and television personality, has vaulted to front-runner status over a crowded field of politicians, including former Florida governor Jeb Bush, the brother of former President George W Bush. Despite having raised more than $100m in campaign contributions, Jeb Bush failed to connect with voters and ended his candidacy.

In different ways, both Sanders and Trump have defied conventional wisdom by challenging the complacencies of the political establishment. Although Clinton remains the front runner for the Democratic nomination, polls show her lead over Sanders among Democratic voters has shrunk from 25 percentage points two months ago to only six percentage points today. Clinton’s shrinking lead has partly to do with voters’ doubts about her honesty and trustworthiness. Many voters find Bernie’s gruff, plain-spoken manner refreshingly authentic, in contrast to Hillary’s cautious, calculating style.

Young people are especially attracted to the 74-year-old Sanders, who draws large, enthusiastic crowds. In the first three primary and caucus contests – in Iowa, New Hampshire and Nevada – more than 80% of voters under 30 voted for Sanders.

The two candidates differ in substance as well as style. Sanders has risen from obscurity on a platform of reducing inequality, breaking up the big banks and challenging the power of money in politics. He argues that Clinton, like other Democratic politicians in recent years, is too close to Wall Street to stand up to the banks. Her campaign has received $15m from the financial industry, while his is funded by small donations from ordinary Americans. She also benefited personally from corporate largesse, earning more than $20m from paid speeches after leaving her job as secretary of state. The investment bank Goldman Sachs paid her $675,000 for three speeches.

Sanders does not think the regulatory reforms that followed the financial crisis of 2008 went far enough. He wants to break up the big banks and to separate commercial banking from high-risk investment banking. He would levy a tax on financial speculation and use the revenue to make public colleges and universities tuition-free. Sanders also wants to go beyond President Obama’s healthcare reform, which left private insurance companies in place, and create a universal, single-payer health system. Clinton argues that these proposals are unrealistic and favours more modest, incremental reforms. She claims that Sanders’s emphasis on economic inequality and the power of money in politics makes him a “single-issue candidate”. Clinton cites her extensive foreign policy experience as evidence that she is better qualified to lead America in the world. Sanders replies that good judgment matters more than experience. He voted against allowing the Bush administration to go to war with Iraq, while she voted in favour.

Democratic hopeful Bernie Sanders and his wife, Jane, on the stump in Oklahoma. Photograph: Jacquelyn Martin/AP

The surprising success of the Sanders campaign reflects frustration with the deepening inequality of recent decades and the failure of the Democratic party to address it. Income inequality has reached levels not seen since the 1920s. Most of the economic growth of recent years has flowed to those at the top. The wealthiest one-tenth of 1% (0.1%) now own as much wealth as the bottom 90% combined.

This concentration of income and wealth has made itself felt in politics. The deregulation of the financial industry that set the stage for the financial crisis took place in the late 1990s, during the presidency of Bill Clinton. When Barack Obama took office in the midst of the financial crisis, he appointed economic advisers who had promoted the deregulation of Wall Street during the Clinton years. Heeding their advice, he supported the taxpayer bailout of banks and investment firms while demanding little in return – no break-up of the banks, no separation of commercial and investment banking, no meaningful curbs on executive pay and bonuses, and little help for homeowners unable to afford mortgage payments on houses whose value had collapsed.

Meanwhile, the US Supreme Court struck down restrictions on corporate spending on political campaigns, arguing that spending unlimited amounts of money to make one’s views known was protected by the right of freedom of speech. Big money could now dominate politics without restraint. An analysis by the New York Times found that, in the early months of the current presidential campaign, about half of all the money donated to Democratic and Republican candidates came from just 158 wealthy families.

Mounting anger and frustration with a political system unaccountable to ordinary Americans has also fuelled the candidacy of Donald Trump. The populist moment in American politics finds expression on the right as well as the left. Like many European populists of the right, Trump has seized on the issue of immigration. He would deport the 12 million immigrants who reside in the US without legal permission. To prevent others from entering, he promises to build a wall along the 2,000-mile US-Mexico border. And, much to the delight of his campaign audiences, he declares he will make Mexico pay for the wall.

Trump’s tough stand on immigration appeals to working-class voters who fear that their jobs and wages are threatened by immigrants. But his appeal runs deeper. His hard line on immigration is part of a larger promise “to make America great again”. He rails against America’s trade deficit with China, against Isis terrorists who “chop off people’s heads”, against a “disastrous” deal with Iran to end sanctions in exchange for limits on its nuclear programme. Wherever he looks, Trump sees the failure of American power and will. “We don’t win any more,” he complains. His campaign is fundamentally about reversing American disempowerment. This is why Trump appeals especially to working-class men who feel the economy and the culture have left them behind. “When I’m president,” he boasts, “we will win so much you’ll get tired of winning.”

Despite their ideological differences, Sanders and Trump are tapping into similar sources of discontent. Both speak to Americans’ sense of disempowerment in the face of big money and unaccountable power. And both are critical of mainstream politicians, Democrats and Republicans, who have, over the last three decades, become captive beneficiaries of the system. Unlike their opponents, both Sanders and Trump have refused to accept the support of so-called “Super Pacs”, funding organisations that can raise and spend unlimited amounts of money on behalf of candidates, provided the spending is not directly controlled by the campaign. Their alternatives to “Super Pacs” differ, of course: Sanders has raised millions of dollars online in small contributions (averaging $27 per donation), while Trump, a billionaire, is funding his own campaign. In proclaiming the virtue of paying for his own campaign, Trump speaks bluntly about the corrupting effect of the current system of campaign finance, which effectively permits big corporations and wealthy individuals to buy influence with politicians. (He freely admits that, as a businessman, he, too, lavished campaign contributions on politicians in hope of future favours.)

On several other issues, Trump also has more in common with Sanders than with his fellow Republicans. He has heaped scorn on wealthy hedge fund managers who, thanks to a tax loophole, pay a lower rate of tax on their earnings than their secretaries pay. In language more likely to win applause at an Occupy Wall Street rally than at a Republican convention, Trump declared: “The hedge fund guys didn’t build this country. These are guys that shift paper around and they get lucky… These guys are getting away with murder. I want to lower the rates for the middle class.” Trump has also criticised free trade agreements that lead to the loss of American jobs to low-wage countries. Like Sanders, he opposes the TPP (Trans-Pacific Partnership), a pending trade deal among the US, Japan and 10 other nations, negotiated by the Obama administration and supported by Republicans in Congress. (Under pressure from Sanders’s challenge, Clinton broke with the Obama administration and now opposes the trade deal, despite having supported it while in office.)

Hillary Clinton, the Democratic front runner, is coming under intense pressure from Bernie Sanders. Photograph: Gerald Herbert/AP

In perhaps his most brazen break with the Republican party establishment, Trump has denounced the Iraq war as “a disaster”. During a debate in South Carolina, a state with strong military traditions, Trump declared that President George W Bush lied about Saddam Hussein possessing weapons of mass destruction, as a pretext for going to war. When Jeb Bush claimed that his brother had “kept the country safe”, Trump denied it, reminding the audience that the 9/11 attack on the World Trade Center occurred during Bush’s presidency. Despite this apostasy on the legacy of George W Bush and the Iraq war, Trump won the South Carolina primary by a comfortable margin.

The unexpected resonance of the Sanders and Trump campaigns does not represent a decisive turning of American voters towards the left or towards the right. It represents a populist protest against a neoliberal economic order embraced by the establishment wings of both parties, which bestows lavish rewards upon those at the top and makes life precarious for everyone else.

The rise of Sanders and Trump is less about ideology than about anxiety that the American Dream is slipping away. This is what Sanders means when he says that the system is rigged against ordinary Americans. And this is what Trump means when he says that America doesn’t win any more. Both give expression to a widespread sense that Americans are losing control of the forces that govern their lives.
The American Dream has never been about reducing inequalities of income and wealth. It has been about enabling people to rise and giving one’s children the chance to rise even further. This is why Americans have traditionally worried less about inequality than Europeans do. We may have greater disparities of income and wealth than do the welfare states of Europe, we would tell ourselves, but here, we are not consigned to the class of our birth. Mobility, not equality, is the measure of our freedom. In recent decades, however, this comforting self-image has begun to ring hollow. The long-standing faith that those who “work hard and play by the rules” will get ahead no longer fits the lived experience of working-class and middle-class Americans. The growing inequality of recent decades has not been offset by opportunities to rise. To the contrary, it has brought a hardening of economic mobility.

The US has less mobility than most major European countries. Forty-two per cent of American men born in the bottom fifth of the income scale remain stuck there as adults (compared with 25% in Denmark and 30% in Britain). Only 8% of American men rise from the bottom fifth to the top. Studies of mobility from one generation to the next tell a similar story. Class mobility is greater in Denmark, Norway, Canada, Sweden, Germany and France than in the US. The American Dream is alive and well and living in Denmark.

If the promise of upward mobility is no longer a realistic way to contend with inequalities of income and wealth, Americans may need to reconsider the place of equality in the American Dream. Whether this populist moment will prompt such rethinking remains to be seen.