It is often claimed that this recession is hitting all of us. It is said that the rich suffer just as much as anyone else, if not more. It is argued that we all must make a sacrifice as we are all in this together. However this simply isn’t true. In fact this crisis is resulting in even further increases in the gap between rich and poor. Inequality and poverty are rising to even higher heights. Austerity is making the poor suffer the most while leaving the rich untouched. Quite simply the rich are getting richer while the poor are getting poorer.
A recent study by Social Justice Ireland shows that disposable income of the poorest households have declined by a massive 18% while the richest households have actually seen an increase of 4%. The top 10% of earners now receive 14 times the income of the bottom 10%. This has sky rocketed from 1980 when it was only 8 times. In fact the top 10% receive more than the bottom 60% of Irish society. All data is for 2010. Director of Social Justice Ireland Sean Healy said “There is something profoundly wrong with government decisions that produce this lop-sided distribution of income favouring the richest when Ireland’s poor and middle income people struggle to make ends meet in these extremely difficult times.” He also criticized the government’s policies as they are only making the situation worse.
The study also pointed out the importance of social welfare. It estimated that without it the poverty rate in Ireland would be 51%, whereas with it, it is 15.8%. This still means more than 700,000 Irish people are in poverty, a rise of 80,000 people in one year as the rate was only 14.1% in 2009. This is a shockingly high level of poverty in what is supposed to be one of the richest countries in the world. Surprisingly 29% of households in poverty were classified as at work. The fact that a family could be working and still not be able to afford the necessities of life is a deep injustice.
The 2012 Budget was condemned as one of the most unequal budgets yet as the poorest 40% of households will suffer cuts of between 2 and 2.5% while the richest 30% only lose 0.7%
Michael Taft has also studied the rising inequality in Ireland. In the diagram below you can see the impact of austerity up to 2010 (the most recent data). It is shocking how unequal the burden has fallen. The poorest has been hammered while the richest have barely been scratched. This is absolutely outrageous. The poor did not benefit from the Celtic Tiger yet they are suffering the most from the recession. The rich who made the fortunes during the good times get to keep it unlike the rest of the country. It goes to show how far you can get with enough political influence. The rich were able to influence Fianna Fail and seem to do the same with the new government. If you can afford lobbyists or to make political donations then you can escape your obligations. As usual it is the poor, voiceless, outsiders who must suffer.
Ireland is in a desperate crisis. Austerity is making things worse. Worse still, poverty and inequality are rising. The rich are dodging paying their fair share. We can no longer crucify the poor on the cross of austerity and force the crown of poverty upon their head. We can no longer afford to allow the rich get richer while the poor sink into abject and wasteful poverty.