Economics of… repression

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Nothing controls the masses better than a nice, little bit of repression. Are those Muslims getting out of control? How about banning the hijab? The gays acting a little bit overconfident? Producing a draconian and apocalyptic-sounding ‘sodomy’ law will help chink away at their in-your-face pride. The working-class asking a little bit too much? Why not take away a few of their lifelines like health and education! Repression is easy if you think about it and with the Scots now bonded with at least another generation of British tyranny, I’ve been thinking about how economics can play a role in ensuring control of those haggis-eating, binge-drinking Celts.

OLYMPUS DIGITAL CAMERATo be honest, I don’t have to look far. Just at a few bits of paper my ancestors bought over from Poland. It was the stamp limiting my grandfather to ‘Ghetto benches’ in public spaces or his rejection from the civil service because he didn’t identify as Catholic. Repression economics are easy; they simply involve excluding any said group from certain portions of work or benefits. Even more subtle is the social alienation of a particular people which, in turn, weakens their ability to fit into our economic system. But maybe the persecution of Jews in 1930s (pre-Nazi, by the way) Poland is too obvious an example.

Whilst subjugating a certain ethnicity or nation might be relatively easy, putting down an overlapping, diverse group whose only shared identity is income is slightly more difficult. Above my desk are the economic bibles of Adam Smith’s The Wealth of Nations and its antidote, Karl Marx’s Das Kapital. Smith claims, and to a great extent it is easy to believe him, that capitalism gives all humans the opportunity to excel, but when push comes to shove, Marx – looking at the satanic mills and squalor bought about by the Industrial Revolution – concluded that, ultimately, the class we are born in, is the class we will die in.

Smith’s notion has become the embodiment of the American Dream, the idea that anyone can make it in the United States regardless of background. But according to a project led by Markus Jantti, an economist at a Swedish university, 42% of American men raised in the bottom fifth of incomes stay there as adults. This is hardly the American Dream as envisaged by the Founding Fathers, but whilst the economic system is difficult to break, we must also ask if it is actively fighting against the poorest in society.

The statistics are similar in Britain; with just the five richest families in the UK owning more money than the bottom 12 million combined. It could be argued, therefore, that in a country, already famous for its immobile class structure, that any policy – whether Conservative or Labour – which reduces spending on social mobility is a form of economic repression which will only increase the plight of the poorest.

Humans need investment in order to achieve their greatest amount of productivity. Like machines need to be regularly updated to achieve their greatest potential, human beings need to be healthy, educated and happy in order for them to contribute fully to the economy as a whole. By failing to support those on the margins of society unable to entirely support themselves, we are creating a market of unfulfilled potential and fuelling repression by economic means.

Photo credit: Mschel (Flickr)

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