9 characteristics of the New Inequality in Europe

Before the French Revolution, about 1 in 20 of the French labour force worked for the Court - making wigs, building palaces, gilding statues, or as servants. Is the post-industrial economy a court economy, in which the work of many, exists for the status of a privileged few? The trend is certainly in that direction.

A few examples of workfare in the Netherlands... In Groningen, a special van-taxi takes University and City personnel to work. Unemployed from the job pool act as chauffeur, for these "high-income, central-urban employees". In Maastricht the Local Economic Development Corporation recruited 4 people "from the bottom of the labour market", as shoeshiners. In Amsterdam, employment agency Randstad built a replica of a 1854 clipper sailing ship: 450 young unemployed did the work. Randstad and Amsterdam City council now use the ship, for receptions and business presentations. (When budget cuts threatened this workfare project in 2003 , the chair of the Amsterdam Labour Party asked to keep it, to "put the fucking Moroccans on this ship and keelhaul them if they cause trouble").

Besides these examples, thousands already work as street-cleaners, car-park attendants, hospital cleaners, and so on. At most they are paid slightly more than unemployment benefit. All the jobs share one characteristic: the unemployed will never have the income and social status, of the people they serve. They will never have the money to hire a sailing clipper: they will never be a Professor at Groningen University. Almost certainly, neither will their children.

Those projects illustrate the term New Inequality, better than the usual statistical approach. In the United States, the term 'new inequality' was first used to describe growing income inequalities. For a generation, the lowest incomes in the US have stagnated, but higher incomes have risen dramatically. In Europe, income inequality is not the whole story. The nine characteristics listed here summarise the new inequality in Europe, in more abstract terms.


The primary characteristic of the new inequality is a political belief. It is the belief that society has become so complex, that many in the population can not fully participate in it. This is what makes the new inequality different. So far as I know, social complexity was not used 100 years ago, as a political or moral legitimation of inequality. The new inequality refers to the future, not the past, for its justification. In caricature form, the privileged in the year 1500 said: "I am better than you, because of my ancestors in the past". Now they say: "I am better than you, because in the coming 10 years I will adapt faster than you".

Behind the new inequality is the belief, that part of the population can not cope with technological society - perhaps 20%, perhaps 40%, perhaps 60%. Not just because they do not have the skills or education for a high-tech job - but because of inherent personal incapacity. Also typical is the belief that this necessitates a split society, where these 'failures' have a service function for the successfully adapted winners.

In other words, the new inequality is based on a social division into 'producers' and their 'servants', legitimised by the claim that this protects the 'servants', and gives them a social role. It is not necessarily a dual (2-level) society: some models are of 3-layer or 4-layer societies.


Associated with this belief, is a return of traditional legitimation of inequality: above all a dramatic return of biological inferiority theories. The Bell Curve, published in the US in 1994, was probably the most serious academic claim of biological inferiority, since 1945. And it made that claim about blacks: it is also the most serious western biological race theory, of the last decennia. In 'new inequality' societies, most high-income earners will believe that they are biologically superior, to low-income earners. Many will hold other theories of inherent inequality: cultural, or linguistic, or moralistic neo-Victorian.


The social policy context in this kind of society is the abandonment of social mobility as a social goal and ideal. Both of these abandonments feature in The End of Equality (Mickey Kaus, 1992). It advocated the conscription of the US (black) underclass into a sort of Labour Army - because no government policy will ever bring income or job equality.

The wave of new workfare projects in Europe since the 1990's, are a similar rejection of the ideal of equality. The workfare lobby believes, that some groups are beyond any traditional means of social mobility. Either for themselves, or for their children. Workfare projects characteristically include no social mobility provisions. If they include training, it is for a job at the same level as the workfare project. The street-cleaners 'graduate' to indoor cleaners, at best - never to the Corps Diplomatique.


As a result of these attitudes and policies, the State, not McDonalds-type employers, becomes the main provider of new low-income jobs. All over western Europe, thousands of unemployed are being placed in workfare projects. Many of these are recognisably public-sector functions: sweeping the streets is a traditional low-income government job. Sometimes the administration is contracted out to private companies, but the jobs remain public-sector service jobs (and some domestic service). Typically, there is almost no production work. Security guards, concierges, cleaners, low-grade maintenance work in parks and streets, tram conductors, station attendants: all of these are service functions. Some urban workfare projects use the unemployed for urban renovation or 'environmental" projects, as low-grade construction workers. Typically, workfare projects include no capital investment, and productivity is inevitably very low. They form a low-technology sector. So the traditional left criticism - that these programmes are a trick to lower high industrial wages - is not relevant. Classic production workers (cars or semiconductors) are unaffected by workfare - unless they lose their job and can not find similar work.


In the longer term, workfare will become the only future for a large group. What is worse than an underclass of McDonalds employees? An underclass excluded even from work at McDonalds - and that is what is emerging in Europe. They are excluded even from some non-employment activity. The kind of work excluded from workfare projects, also says a lot about workfare. Workfare is local: the unemployed must work in their own region. Workfare projects do not allow the unemployed to work in health care in Africa, or on peace projects in Bosnia. These are uncontroversial stereotype examples, to emphasise the limited range of workfare jobs. A youth peace camp in Bosnia is politically uncontroversial - but even this sort of project will be confined to the children of the upper-middle-class. (As it is now, since the cost to volunteers is usually substantial). Lower-class youth will be placed on local youth workfare.

Also excluded from workfare are political projects in a broad sense, such as anti-racism work. The creation of a servant underclass, is also the creation of un-citizens. The 'workfare class' is almost by definition outside 'civil society'. They can work to serve others - but they can not influence the structure of society through their work. Nor outside work. In the last 50 years a wide range of political and social organisations was created in Europe: the classic 'civil society'. However, almost all are run by university graduates: in any dual society, civil society is for the upper half. Traditional labour unions became service and marketing organisations: they too are 'elite employers'. Low-income groups in European societies can not exercise their formal rights, to participate in shaping these societies.

The ultimate formalisation of this caste status would be the creation of a permanent parallel economy. The creation of exchange systems, for unpaid work is one possible route to this parallel economy. LETS systems (Local Exchange Trading Systems) 'monetise' services for low-income people. If they are successful, they create a sort of second-class currency - with approximately the same status as the non-convertible currency of a small African country. The earnings from workfare projects then become the export earnings, of the parallel economy of the poor. They will earn some real money in their workfare tasks: they will use it to buy food and housing. For their local tokens, they will repair each other's cars, look after each other's children, or cut each other's hair. Whatever they earn in LETS, they will be unable to spend in real supermarkets.


The political context of the new inequality differs from that of the old inequality. Who invented all these humiliating jobs for the poor? Was it the fascists, or the neo-liberals, or the secret police? No: it was the left. The left, and social organisations, are the political motor in the formation of a servant underclass, using the social security system. At European level, the lobby for European-scale workfare programmes, comes from the Socialists and Greens in the European Parliament.

This in turn is based on a consensus of left and right to accept permanent inequality. The answer of the left to this inequality is the creation of "socially useful work" - workfare. This is political propaganda, without real meaning. If sweeping the streets is 'socially useful', then the Green and Social-Democratic intellectuals should sweep the streets. Instead they promote EU programmes, to force the unemployed into such jobs - or lose their social security benefits. The unemployed are not allowed to define the moral norms, for their future employment. EU employment policies are formulated in almost total exclusion of those they affect, partly because the unemployed have abandoned the political process. In differing degrees, this pattern applies within the national states as well.


The new inequality is permanently present, even for those with real work: it means lifelong testing, the inevitable consequence of lifelong education. A society which emphasises employability, is a sort of students nightmare - examinations every month. Ironically those at the top will sometimes be tested less: simply because they are so difficult to replace anyway. At the middle range, the pressure on the employed will be very great: they are replaceable. They will be constantly assessed, and constantly reminded (by the army of car-park attendants), of what happens to those who fail. It is difficult to predict the consequences. However, 'petit-bourgeois fear of re-proletarisation' is one of the classic theoretical explanations, for the rise of fascist parties in Europe in the 1930's.


To guarantee employment status, beyond that of simple employee, a university degree or equivalent will be the minimum qualification. No-one under this level will ever take any decision at work. In turn, this will reinforce the already negative influence of universities in Europe.

Emphasis on education is not an inevitable consequence of a 'knowledge society', or 'information society'. There is no qualitative change of the kind implied by these labels, which itself causes inequality. However, they imply that dramatic social changes are in progress. In turn, that suggests that some people cannot cope with them. This implicit secondary claim is used to legitimise the inequality.


To some extent there will be a revival of elite universities, and other elite institutions. There is a debate in the US about whether there is a new 'overclass' to correspond to the 'underclass'. There are certainly new high-income professions (option traders). However, elites are not new in themselves, nor are elite institutions. Even elite nostalgia for the customs of past elites, is not new. Rather than a simple return to the past, it is probably more accurate to see this revival, as part of the 'constant-assessment' trend.

Entrance barriers to elite institutions (formal and informal) test those who want more than the new minimum. Ironically, the elite of university-educated, high-income professionals suffers functional homogenisation. Their jobs have become so similar and so managerial, that they offer no distinctions of status. Within this group social distinctions may become more important. 'Yuppie traditionalism' is the result: attending traditional universities, classic styles in clothing, traditional weddings, etiquette, reading Latin classics, and of course attending The Opera.

Policy suggestions

The core of the new inequality is not economic process or restructuring, but a political belief. The ultimate answer to it is, the realisation that belief in equality and belief in inequality are incompatible. A society can not be egalitarian and inegalitarian at the same time: it is one, or the other.

In the short term, the promotion of theories of inherent group inequality should be criminalised. That applies especially to theories of racial inferiority. The appropriate response to The Bell Curve, is to imprison its authors.

Secondly, all existing workfare projects in Europe should be dissolved. If participants want to restart the programme themselves, they should be allowed to do so. No organisation, public or private, should be allowed to use threats to social security benefits to induce work for that organisation.

Third, all attempts to officially define "socially useful" work, or "community benefit", should be abandoned. Individuals should choose for themselves, if they feel morally obliged to clean the streets for others.

Fourth, and most important politically: the moral basis of social security payments should be redefined. Payment to the unemployed should be defined as compensation, for injustice and discrimination. In principle, an employer who refuses a job applicant, should compensate the applicant for loss of wages. The State can then take over this obligation, in the form of a fund for unemployment -open to anyone who has ever been refused a job.

True, this is a redefinition of the existing system. But it removes the pseudo-ethical claim, that the unemployed have an obligation to the employed. It is the other way round: those with jobs are guilty - guilty of competition for jobs. The free labour market is not a voluntary competition, like a marathon race. It is a race, created by the winners, to provide an opportunity to win. Any free market system is only morally acceptable, if participants can withdraw: and in reality they never can withdraw.

The moral justification, for treating unemployment benefit as compensation to the losers, is simple. Put all the winners in public, and everyone will see that they are almost entirely white, male, upper-middle-class, members of the dominant nationality in each country. Explicit and obvious discrimination is the classic characteristic of free competitive labour markets. That is the weak point of right-wing claims, that the unemployed have obligations to the employed. No-one acquires obligations, as a result of being unfairly treated: those with jobs profited from discrimination. It is therefore morally legitimate, to redefine unemployment payments as compensation.

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