Breaking the cycle of poverty - It’s getting far harder to get ahead

A series of reports, and Wednesday’s budget in Britain, confirm that being average describes an increasingly unattractive place in this world. “Average” now describes something far less secure than it did a decade ago. Social advances realised over generations are being rolled back, inch by inch, expectation by expectation, opportunity by opportunity.

Breaking the cycle of poverty - It’s getting far harder to get ahead

Being an average poor person is an almost impossible challenge, so many of life’s basic expectations are simply unattainable without a seismic shift in circumstances. Only a tiny minority of poor people have the energy, self-belief, education or opportunity — luck — to break out of trans- generational poverty.

Once predestination was a matter for the soul, eternal life and how many bankers could dance on the head of a pin but now, more than ever, it seems a social sentence. If you are born poor you will probably live and die poor and your children will share your miserable fate as well.

One set of figures that feeds into this idea can be seen in the latest Eurostat House Price Index, especially those dealing with Ireland. They show that an average Irish home costs 16.8% more in the first quarter of 2015 than it did in the corresponding period in 2014.

The European average — that ever-more flexible word again — was a fraction of that at 2.5%. House prices here rose by more than six times the EU average in the first three months of 2015. No average Irish person got a 6.8% pay rise last year, much less one of 16.8%.

The terrible difficulties faced by your average young family in securing a home in a bubble-bound market like this are highlighted in another report. The OECD warned that millions of workers at the bottom of the economic ladder are finding life more and more difficult. The report also pointed out that Ireland is one of only three OECD countries where the minimum wage has fallen relative to the median wage.

“The (economic) recovery is still far from complete and time is running out to prevent millions of workers from being left trapped at the bottom of the economic ladder,” wrote Stefano Scarpetta, OECD director of employment, labour and social affairs.

One of the consequences of this, according to Eurostat, is that we have the highest expenditure rate on unemployment in the EU. The EC agency found Ireland spends twice the EU average on unemployment costs. Irish spending on unemployment was highest at 7.6% of total expenditure in 2014, more than double the EU average of 3.2%.

How some of Britain’s poor and unemployed — or just poorly paid workers — might look at that statistic with envy. According to the UK’s Institute for Fiscal Studies about 13m families will lose an average of €362 a year due to Wednesday’s budget changes to working-age tax benefits. Tax credit changes could hit three million families, which are likely to lose an average of €1,400.

The crisis in Greece, the huge destruction of wealth in China’s stock markets may be today’s headlines underlining the weaknesses of capitalism but the grinding day-to-day lives of those denied the kind of dividend a fair system would make possible may, in time, be the catalyst for real change.

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