Poverty Changes

£14,000 is quite a large amount of money. Enough for 70,000 Freddos, a decade’s worth of holidays, two new Nissan Pixo’s, several thousand potatoes or a gold standard racing pigeon. However, if you’re trying to live off just that amount in modern Britain, it quickly seems quite a lot smaller. Half of that could easily disappear on rent, whilst the average British family will spend a further £4,000 on food (significantly greater than the European average, for one reason or another). Then we must factor in tax, work-related expenses, various repair bills, a TV license, utility & heating bills, petrol money and other transport expenses, and it quickly becomes apparent that trying to live on this amount will require some careful budgeting. Still, not to worry too much though; it’s certainly possible to keep the body and soul of a medium sized family together on £14k a year, if not absolutely comfortably, and in any case 70% of British families have an annual income in excess of this amount. It might not be a vast amount to live on, but it should be about enough.

However, there’s a reason I quoted £14,000 specifically in the figure above, because I recently saw another statistic saying that if one’s income is above 14 grand a year, you are one of the top 4% richest people on planet Earth. Or, to put it another way, if you were on that income, and were then to select somebody totally at random from our species, then 24 times out of 25 you would be richer than them.

Now, this slightly shocking fact, as well as being a timely reminder as to the prevalence of poverty amongst fellow members of our species, to me raises an interesting question; if £14,000 is only just about enough to let one’s life operate properly in modern Britain, how on earth does the vast majority of the world manage to survive at all on significantly less than this? More than 70% of the Chinese population (in 2008, admittedly; the rate of Chinese poverty is decreasing at a staggering rate thanks to its booming economy) live on less than $5 a day, and 35 years ago more than 80% were considered to be in absolute poverty. How does this work? How does most of the rest of the world physically survive?

The obvious starting point is the one stating that much of it barely does. Despite the last few decades of massive improvement in the living standards and poverty levels in the world in general,  the World Bank estimates that some 20% of the world’s populace is living below the absolute poverty line of surviving on less than $1.50 per person per day, or £365 a year (down from around 45% in the early 1980s- Bob Geldof’s message has packed a powerful punch). This is the generally accepted marker for being less than what a person can physically keep body and soul together on, and having such a huge proportion of people living below this marker tends to drag down the global average. Poverty is something that the last quarter of the century has seen a definitive effort on the part of humanity to reduce, but it’s still a truly vast issue across the globe.

However, the main contributing factor to me behind how a seemingly meagre amount of money in the first world would be considered bountiful wealth in the third is simply down to how economics works. We in the west are currently enjoying the fruits of two centuries of free-market capitalism, which has fundamentally changed the way our civilisation functions. When we as a race first came up with the concept of civilisation, of pooling and exchanging skills and resources for the betterment of the collective, this was largely confined to the local community, or at least to the small-scale. Farmers provided for those living in the surrounding twenty miles or so, as did brewers, hunters, and all other such ‘small businessmen’, as they would be called today. The concept of a country provided security from invasion and legal support on a larger scale, but that was about it; any international trade was generally conducted between kings and noblemen, and was very much small scale.

However, since the days of the British Empire and the Industrial Revolution, business has got steadily bigger and bigger. It started out with international trade between the colonies, and the rich untapped resources the European imperial powers found there, moved on to the industrial scale manufacture of goods, and then the high-intensity sale of consumer products to the general population. Now we have vast multinational companies organising long, exhaustive chains of supply, manufacture and retail, and our society has become firmly rooted in this intense selling international economy. Without constantly selling vast quantities of stuff to one another, the western world as we know it simply would not exist.

This process causes many side effects, but one is of particular interest; everything becomes more expensive. To summarise very simply, the basic principle of capitalism involves workers putting in work and skill to increase the value of something; that something then gets sold, and the worker then gets some of the difference between cost of materials and cost of sale as a reward for their effort. For this to work, then one’s reward for putting in your effort must be enough to purchase the stuff needed to keep you alive; capitalism rests on the principle of our bodies being X% efficient at turning the food we eat into the energy we can use to work. If business is successful, then the workers of a company (here the term ‘workers’ covers everyone from factory floor to management) will gain money in the long term, enabling them to spend more money. This means that the market increases in size, and people can either sell more goods or start selling them for a higher price, so goods become worth more, so the people making those goods start getting more money, and so on.

The net result of this is that in an ‘expensive’ economy, everyone has a relatively high income and high expenditure, because all goods, taxes, land, utilities etc. cost quite a lot; but, for all practical purposes, this results in a remarkably similar situation to a ‘cheap’ economy, where the full force of western capitalism hasn’t quite taken hold yet- for, whilst the people residing there have less money, the stuff that is there costs less having not been through the corporation wringer. So, why would we find it tricky to live on less money than the top 4% of the world’s population? Blame the Industrial Revolution.


The Churchill Problem

Everybody knows about Winston Churchill- he was about the only reason that Britain’s will to fight didn’t crumble during the Second World War, his voice and speeches are some of the most iconic of all time, and his name and mannerisms have been immortalised by a cartoon dog selling insurance. However, some of his postwar achievements are often overlooked- after the war he was voted out of the office of Prime Minister in favour of a revolutionary Labour government, but he returned to office in the 50’s with the return of the Tories. He didn’t do quite as well this time round- Churchill was a shameless warmonger who nearly annihilated his own reputation during the First World War by ordering a disastrous assault on Gallipoli in Turkey, and didn’t do much to help it by insisting that everything between the two wars was an excuse for another one- but it was during this time that he made one of his least-known but most interesting speeches. In it he envisaged a world in which the rapidly accelerating technological advancement of his age would cause most of the meaningful work to be done by machines, and changing our concept of the working week. He suggested that we would one day be able to “give the working man what he’s never had – four days’ work and then three days’ fun”- basically, Winston Churchill was the first man to suggest the concept of a three day weekend.

This was at a time when the very concept of the weekend itself was actually a very new one- the original idea of one part of the week being dedicated to not working comes, of course, from the Sabbath days adopted by most religions. The idea of no work being done on a Sunday is, in the Western and therefore historically Christian world, an old one, but the idea of expanding it to Saturday as well is far newer. This was partly motivated by the increased proportion and acceptance of Jewish workers, whose day of rest fell on Saturday, and was also part of a general trend in decreasing work hours during the early 1900’s. It wasn’t until 1938 that the 5 day working week became ratified in US law, and it appeared to be the start of a downward trend in working hours as trade unions gained power, workers got more free time, and machines did all the important stuff. All of this appeared to lead to Churchill’s promised world- a world of the 4-day working week and perhaps, one day, a total lap of luxury whilst we let computers and androids do everything.

However, recently things have started to change. The trend of shortening working hours and an increasingly stressless existence has been reversed, with the average working week getting longer dramatically- since 1970, the  number of hours worked per capita has risen by 20%. A survey done a couple of winters ago found that of our weekend, we only spend an average of 15 hours and 17 minutes of it out of the work mindset (between 12:38am and 3:55pm on Sunday when we start worrying about Monday again), and that over half of us are too tired to enjoy our weekends properly. Given that this was a survey conducted by a hotel chain it may not be an entirely representative sample, but you get the idea. The weekend itself is in some ways under threat, and Churchill’s vision is disappearing fast.

So what’s changed since the 50’s (other than transport, communications, language, technology, religion, science, politics, the world, warfare, international relations, and just about everything else)? Why have we suddenly ceased to favour rest over work? What the hell is wrong with us?

To an extent, some of the figures are anomalous-  employment of women has increased drastically in the last 50 years and as such so has the percentage of the population who are unemployed. But this is not enough to explain away all of the stats relating to ‘the death of the weekend’.Part of the issue is judgemental. Office environments can be competitive places, and can quickly develop into mindsets where our emotional investment is in the compiling of our accounts document or whatever. In such an environment, people’s priorities become more focused on work, and somebody taking a day extra out on the weekend would just seem like laziness- especially of the boss who has deadlines to meet and really doesn’t appreciate slackers, as well as having control of your salary. We also, of course, judge ourselves, unwilling to feel as if we are letting the team down and causing other people inconvenience. There’s also the problem of boredom- as any schoolchild will tell you, the first few days of holiday after a long term are blissful relaxation, but it’s only a matter of time before a parent hears that dreaded phrase: “I’m booooooored”. The same thing can be said to apply to having nearly half your time off every single week. But these are features of human nature, which certainly hasn’t changed in the past 50 years, so what could the root of the change in trends be?

The obvious place to start when considering this is in the changes in work over this time. The last half-century has seen Britain’s manufacturing economy spiral downwards, as more and more of us lay down tools and pick up keyboards- the current ‘average job’ for a Briton involves working in an office somewhere. Probably in Sales, or Marketing. This kind of job involves chiefly working our minds, crunching numbers, thinking through figures and making it far harder for us to ‘switch off’ from our work mentality than if it were centred on how much our muscles hurt. It also makes it far easier to justify staying for overtime and to ‘just finish that last bit’, partly because not being physically tired makes it easier and also because the kind of work given to an office worker is more likely to be centred around individual mini-projects than simply punching rivets or controlling a machine for hours on end. And of course, as some of us start to stay for longer, so our competitive instinct causes the rest of us to as well.

In the modern age, switching off from a modern work mindset has been made even harder since the invention of the laptop and, especially, the smartphone. The laptop allowed us to check our emails or work on a project at home, on a train or wherever we happened to be- the smartphone has allowed us to keep in touch with work at every single waking moment of the day, making it very difficult for us to ‘switch work off’. It has also made it far easier to work at home, which for the committed worker can make it even harder to formally end the day when there are no colleagues or bosses telling you it’s time to go home. This spread of technology into our lives is thought to lead to an increase in levels of dopamine, a sort of pick-me-up drug the body releases after exposure to adrenaline, which can frazzle our pre-frontal cortex and leave someone feeling drained and unfocused- obvious signs of being overworked

Then there is the issue of competition. In the past, competition in industry would usually have been limited to a few other industries in the local area- in the grand scheme of things, this could perhaps be scaled up to cover an entire country. The existence of trade unions helped prevent this competition from causing problems- if everyone is desperate for work, as occurred with depressing regularity during the Great Depression in the USA, they keep trying to offer their services as cheaply as possible to try and bag the job, but if a trade union can be use to settle and standardise prices then this effect is halted. However, in the current age of everywhere being interconnected, competition in big business can occur from all over the world. To guarantee that they keep their job, people have to try to work as hard as they can for as long as they can, lengthening the working week still further. Since trade unions are generally limited to a single country, their powers in this situation are rather limited.

So, that’s the trend as it is- but is it feasible that we will ever live the life of luxury, with robots doing all our work, that seemed the summit of Churchill’s thinkings. In short: no. Whilst a three-day weekend is perhaps not too unfeasible, I just don’t think human nature would allow us to laze about all day, every day for the whole of our lives and do absolutely nothing with it, if only for the reasons explained above. Plus, constant rest would simply sanitise us to the concept, it becoming so normal that we simply could not envisage the concept of work at all. Thus, all the stresses that were once taken up with work worries would simply be transferred to ‘rest worries’, resulting in us not being any happier after all, and defeating the purpose of having all the rest in the first place. In short, we need work to enjoy play.

Plus, if robots ran everything and nobody worked them, it’d only be a matter of time before they either all broke down or took over.