The Era of Making Ends Meet

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2015 will be all about making ends meet; or rather, not making ends meet.  Gone are the drama days of the last few years – NAMA, bondholder debt, collapsing employment and output, bailouts and Troikas (unless the EU decision-makers are determined to accelerate the European deflationary spiral; then we could have drama aplenty).  It’s not that these issues have gone away – but they are now embedded, hidden, in what can be called a ‘new normal’.  And this means we are entering into an excruciating and potentially protracted period of grinding things out; day by day.

So many commentators talk about the economy in recovery but ‘people not feeling it yet’.  I suggest there is a better way of looking at it.  The boulder has fallen down the hill – that’s what the gravity of recession will do; that, and austerity pushing it down faster.  Now people are pushing the boulder back uphill – it’s a big boulder and it’s a big hill.  And people are supposed to be ‘feeling it’?  They are supposed to be grateful?  Hmm.

We have discussed other indicators – deprivation, food poverty.  These are harsh benchmarks that affect a significant proportion of the population.  But there is another indicator, referred to as ‘soft’, which gives a more representative picture of this phase we are entering:  making ends meet.  It is called soft because it is not calculated on the basis of percentages of the median wage (relative poverty) or even a survey of people’s concrete experience (deprivation indicators).  It is based on asking people ‘are you having difficulty making ends meet’ – a highly subjective question that doesn’t define ‘difficulty’ or ‘ends’.  It is left to people to determine that.

The EU asks such a question in the annual Survey of Income Living Conditions.  They break it down by degrees:

  • Households making ends meet with great difficulty
  • Households making ends meet with difficulty
  • Households making ends meet with some difficulty

This is the result:

Making Ends Meet 1

Ireland is well above the EU average and far above our peer group – other small open economies.  More than one in six are having great difficulties, another one in six having difficulty while more than one-in-three are having some difficulty.  When we add all these difficult household experiences up we find:

Making Ends Meet 2

We shouldn’t be surprised that Greece tops the league with 91 percent having some degree of difficulty.  Ireland ranks fourth – with over 70 percent.  Sweden is at the bottom – only 16 percent having any degree of difficulty (and of that, less than three percent have great difficulty).

And, again, we shouldn’t be too surprised that, in Ireland, a higher proportion of those living in at-risk-of poverty conditions (relative poverty) are having difficulties compared to those above the poverty threshold, but the differences are not as stark as one might think.

Making Ends Meet 3

Over a third of those living in relative poverty are having great difficulties compared to 14 percent above the threshold.  However, this gap narrows for those having ‘Difficulty’ while nearly 40 percent not living in relative poverty are having some difficulties.  Overall, 88 percent of those in relative poverty are having some degree of difficulty making ends meet.  But 68 percent who are not officially classified as at-risk of poverty are also having difficulties, if not to the same degree.

This poses a challenge to progressives in 2015, up to the next election and beyond:  to construct a platform of policy and activism that can not only knit together this broad coalition of those having difficulties; but to also include significant sections of those who are making ends meet ‘easily’ (29 percent) .  In this category we will find people, while not having difficulties themselves, do not want to live in a society where their neighbours are struggling.

This coalition-building will not be easy.  Many will want a significant break with an economic regime that has continually subordinated them.  It is worth noting that even in 2007, when the economy and incomes peaked, over 50 percent were still having difficulties making ends meet.  The recession exacerbated this condition – to the point of increasing deprivation to obscene levels –  but didn’t create it.

Many others, though, may not be seeking so much an economic regime-change as a helping hand, policies that address those particular aspects that are causing the difficulty (e.g. debt relief, affordable childcare, the ability to access more hours at work, rising rents).

What progressives and trade unionists need to do, therefore, is construct a realisable programme of change that can incorporate these varying concerns and provide concrete benefits; we need to win trust and confidence.  And we need to be determined, for let’s not underestimate the range of forces we will be confronting – forces that will work 24/7 to undermine a programme based on living wages, debt relief, a public economy and productive investment.

If we can do that, the political sky is the limit.  For we are entering a potentially protracted phase of making ends meet – and the overwhelming majority are having difficulties.

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