DRC – Resource Rich but ‘dirt poor’

The GDP of The Democratic Republic of Congo is $15 billion. GDP (Gross Domestic Product) is the total value of goods and services produced within a country in one year, and so is roughly equivalent to the amount of money that will be spent in total on everything by everyone in one year in that country.**

You might find it difficult to put this amount of money in context, so to give you an idea of how little this it’s useful to think about how we spend similar amounts of money in the UK….

The GDP of the DRC is equivalent to less than half the amount of money the UK Government spends on Housing Benefit per year – (average per year prediction for next four years – $38.1bn (£23.75).

UK government housing benefit expenditure is about 2.5 times greater than the DRC’s GDP

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The entire population of the DRC have about half as much money to spend as BP.’s profits for 2011 ($25.7 Billion) – (BP. Is the UK’s most profitable company).

BP.’s 2011 profits were nearly twice the GDP of the DRC

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The UK population spend $9 billion more on their pets than the entire population of the DRC spend on themselves – Total UK pet expenditure per year stands at £14.9 Billion or $23.9bn

People in the UK spend $9 billion more on their pets every year than DRC’s GDP

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Britain’s second most profitable company, Royal Dutch Shell, made $5 billion more in profit than the total GDP of the DRC – Shell’s 2011 profits were $20 billion.

Shell’s profits in 2011 amounted to $5 billion more than DRC’s GDP

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Finally, and depressingly, the closest equivalent I could find is that DRC GDP is roughly equivalent the amount that UK adults spend on Christmas presents this year – An amount which stands at $13.6bn or £8.5bn.

‘Please sir, I want some more’

Merry Christmas!

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**Yes I know there’s probably quite a lot of additional money floating about because of the massive corruption in DRC, but I have to go with official figures because at least they exist!

An excellent podcast from BBC Radio 4′s Analysis on the above topic should be compulsory listening/ reading for anyone studying the Sociology of Education – you can get both the audio version and the transcript here

The programme centres on Harvey Goldstein’s statistical research – who points out that once you take into account children’s social and economic backgrounds (their home backgrounds if you like) schools only account for 10% of the difference in a child’s educational achievement.

Although she didn’t say it when Labour was in power, on reflection, New Labour’s Education Secretary in the late 1990s, Estelle Morris, now consents that although ‘schools are all we’ve got’ they ‘can never make up for the social disadvantage that children from poor backgrounds and from disinterested families’ – late on in the programme we are reminded that only 1% of children going to Oxbridge are Free School Meal students.

So why is it that government ministers put so much faith in the potential of schools to transform students’ lives?

The programme traces this back to one study conducted in 1979 by Peter Mortimore, one of the principle researches on the “15,000 hours” study – in which the researchers did observations of good and bad schools and identified all of the features that good schools had (good being defined as those which got students good results) – These features were –

• Good teacher support
• A clean environment
• Good behaviour
• Pupils felt like they were valued

This in turn lead into a new field of study centring around the question of ‘what works’ in education – which lead to researchers being dispatched to discover what successful schools were doing – and later this lead onto the question of how we could design these success features of ‘good schools’ into all schools. The programme draws on Pam Sammons Professor at Oxford University who seems to favour this approach.

Going back to Goldstein, he criticises the work of Sammons and the like by pointing out that the features found in good schools may just be coincidental to success – the schools may have good behaviour, the environment may be clean and money might be available for teacher support precisely because these schools have pupils who are from middle class backgrounds, and this may not be repeatable in all schools around the country.

This, however, is not the view Sir Michael Wilshaw, Chief inspector of schools (Head of OFSTED), famed for his headship of Mossbourne Academy in Hackney, one of the most deprived areas of London – this was Labour’s flagship academy which replaced the old failing Hackney Downs schools. Wilshaw claims that, through a combination of strict discipline, very long teacher and student hours and a ‘no excuses culture’ you can improve results in any school – he certainly did in Mossbourne – last year 8 students made it to Oxbridge, way above the national average.

What he forgets to mention of course is that he also had the help of a cool £25 million cash injection for a new building, and then there’s the little matter of his new Academy having almost half the population of FSM children attending as were at Hackney Downs.

As a final note – the programme does an excellent job of flagging up how successive governments selectively ignore research that doesn’t fit in with their own political agendas. The stats suggest social class and ethnic background matters and than schools only make 10% difference, and this is ignored, you then find some statistically dubious research from 1979 and one case study from recent history and use this to show that schools can make a difference…..

Apple recently reported $13.06 billion in profits on $46.3 billion in sales - and these are just the figures for the last three months alone!

• 17 Foxconn employees have killed themselves in the past 7 decades
• Employees work excessive overtime, in some cases seven days a week, and live in crowded dorms
• Some workers say they stand so long that their legs swell until they can hardly walk.
• Under-age workers have helped build Apple’s products
• Two years ago, 137 workers at an Apple supplier in eastern China were injured after they were ordered to use a poisonous chemical to clean iphone screens.
• Within seven months last year, two explosions at iPad factories, including in Chengdu, killed four people and injured 77. Before those blasts, Apple had been alerted to hazardous conditions.
• Finally – A message displayed on a banner above one ‘ipod factory’ reads “Work hard on the job today or work hard to find a job tomorrow.”  

The scary thing about all of the above is that we probably only know about these abuses because the iphone is so high profile - the actual company that manufactures the ipad concerned, its actually a Taiwanese company called Foxconn  

Foxconn's Chengdu plant

Foxconn happens to manufacture a whole load of other well- known brands – including the Kindle, the Xbox, and Playstation 3, and its customers also include other big name phone manufacturers – such as Motorola, Nokia, and Samsung

Foxconn has an annual revenue around $60 billion dollars, employs about 1 million people and has factories in China, India, the Czech Republic, Mexico and Brazil, but the bulk of its manufacturing is based in China where it has 11 factories – the biggest of which is estimated to have between 250 – 400 000 workers in residence. 

Now if we know that Foxconn and Chinese government collude to allow worker-abuse in the manufacture of apple products, my suspicion is that it probably goes on with other products too…!

I started off this post wanting to calculate how much surplus value is being extracted by Apple from its workers, but I quickly realised this is impossible – In order to calculate this accurately we’d have to know precisely what proportion of workers in those Foxconn factories are working exlusively on apple products – rather than making products for all the other companies that Foxconn supplies. This, along with the actual numbers of workers in these factories, are not available.

What I can do, however, is calculate how much apple could afford to give to each worker if we assume that every Foxconn worker works on apple products – and that figure stands at about $13 000 - for the last quarter! – based on

• $13 000 000 000 – Apple’s profits for one quarter – divided by
• 1 000 000- the global total of Foxconn employees

If you quadruple that – and reduce it slightly to reflect the fact that last quarter was ‘Christmas quarter’ – you end up with the $40 000 figure at the top of this post. Obviously these stats underemphasise what each worker could be paid out of that profit pool – if you factor in the profits from Foxconn itself and all the other electronics ‘branding companies’ the figure would increase!

To finish, just a final postscript on surpluss value. If you didn’t already hate Apple enough –  if you just look at Apple employees – Apple extracted more than $400 000 from each employee last year…

… Hopefully in a response that’ll land me with a link to some nice.. err.. wealth distrbution graphs or pie charts…

I’ve spent the last 5 years or so looking for some nice up to date visual resources on wealth distribution in modern Britain, to update the pie chars I’ve gto from about 2006 - with really limited success – is it just me or is it just impossible to find easily accessible information on wealth stats in the UK… Or are pie charts on wealth distribution just not 2012? (or 2007-11 for that matter?)

You might think that searching around the government’s own Office for National Statistics, you’d get some info about wealth, but no, this gets  you nowhere – not if you want any data from the last few years at least.

Out of desperation you might try typing in any combination of ‘wealth distribution 2010 or 11 and UK or Britain’ to google but, with the exception of the excellent report mentioned below from 2010,  you simply get directed to old stats or stats on income distribution - so this is hopeless.  

So  unless I’m missing something – it’s actually very difficult to get reliable, up to date info on Wealth Stats – but here’s five, well four, sources of info.. no nice pie charts tho’!

Firstly there is this recent government report The most comprehensive recent source on wealth distribution seems to be this report from 2010 ‘An anatomy of economic inequality in the UK’ (summarised in this Guardian Article) which found that by retirement age the top 10%, led by higher professionals, had amassed wealth of £853 000,  while the bottom 10% of households, led by routine manual workers, had amassed less than £8,000. This means – and this is my headline figure – the richest 10% are 100 times richer than the bottom 10%

For an even starker comparison – the top 1% had, by the time they reached retirement age,  accrued an average wealth of £2.6 million, making them more than 300 times richer than the bottom 10%

The report measured wealth inequalities by looking at total assets accrued over the course of a lifetime – the findings were hardly surprising – the older you are the richer you are, the poorer your parents were, the less likely you were to accrue wealth and so on…. but it is informative to have such data to hand.

The body responsible for the above report is worth keeping an eye on – The Centre for Analaysis of Social Exclusion for updates on wealth issues.

Secondly, the most recent data from the Office for National Statistics (summarised in a blog which I’m not going to link to because it doesn’t link to anyone else) – reports that

The richest fifth have nearly two thirds of the wealth. More startling is that the poorer half of us speak for just 9p in every £1 of privately held wealth.
Private household net wealth in Great Britain totalled £9 trillion in 2006/08 and nearly 80% of this is accumulated in property and private pension entitlements. 

Median household net wealth was £204,500 in 2006/08. The least wealthy half of households accounted for only 9 per cent of wealth, while the wealthiest 20 per cent of households had 62 per cent of total wealth.

The least wealthy 10 per cent of households had negative total net wealth
Median net wealth – including pensions, houses and cars, but excluding mortgages and other debt – of a household in the South East is £287,900. In Scotland, it is £150,600.

Thirdly, you could use the recent Barclay’s wealth report I blogged about two blogs back

Fourthly, everyone of course knows about the rich list – I’m now reliant on other people’s summaries of this because of the Time’s paywall, and in any case, its international so the this list isn’t UK focussed and it doesn’t talk of ‘distribution’ focussing merely on the worst excesses.

Finally, For income inequalities – we can rely on the JRF’s yearly report on Poverty and Inequality - but this is based on income measurements rather than wealth.

You might like to think about why it’s so hard to find info on this stuff… Or if you know more about where to get this data from than I do, let me know!

OK – So the number of UK millionaires may have fallen immediately after the crash in 2008, but since then, millionaire numbers have bounced back – rising from 528 000 in 2008 to 619 thousand in 2010.

Even worse (well, at least if you’re a fan of justice and equality), over the same period, the number of people with net worth of over £5m rose by 19 per cent over these two years, from 70,000 to 85,000.

So while the Tory government takes an axe to public services and cuts payments to the most vulnerable, the number of UK millionaires just keeps on growing……

The source for the above figures is the ‘Barlcay’s Wealth Map’ 2011.

Attitude Polls such as this one from the JRF (2004) and this research from the British Social Attitudes Survey suggest that about 75% of the population believe that the income gap in the UK is too great. The graphic below shows how the difference between what people in the UK think people should earn in certain careers and what people actually earn.

However, although three quarters of the population think those at the top earn too much, only 20% of MPs support motions for greater equality in the UK – The latest news letter from the trust also states that 101 MPs have signed an early day motion on income inequality, while This link will take you to the current is a list of the 86 MPs that signed an equality pledge put together by the Equality Trust.

So here we have what appears to be a nice example of how out of step our largely unrepresentative democracy is with public feeling – untill you dig a little deeper -

The general public are deeply suspicious of redistributive policies – the public don’t like the idea of the rich getting taxed more and the government giving the money to the poorer – which is linked to a widespread mistrust of the ‘undeserving poor’ – which in turn is probably linked into myths perpetuated by media stereoypes about Chavs. So while people think the income gap is too high, they don’t want the government to redistribute income!

So one solution possible alternative solution to income inequality that isn’t redistributive could be a maximum wage? One model is that the maximum wage in a company is set at a percentage of the minimum – you could make it quite generous – say twenty times greater? That would mean if the minimum wage is say £10 000, the maximum is 200, 000 – to my mind anyone seriously arguing that they are worth more than that per year is deluded. One other advantage of this is that this would actually make managers and workers work closer together – a likely scenario is that if workers demand a pay rise – and they get it, this means the bosse’s pay would go up – if the boss imposes a pay cut – he’d also get a pay cut…..

However, despite the advantages,  the only poll I could find on this suggests there isn’t any public support for this either…

So there you have it – we have a population that thinks income inequality is too great but isn’t actually in favour of either of the two major policies that could tackle it!

The next logical thing to do would be to discuss the factors that might explain this apparent paradox – Of particular interest would to explore how valid those polls on equality beliefs actually are, and how generalisable, and  a second train of enquiry would be to explore whether ideology plays a role here – do we not want greater income equality because we all secretly (or not so secretly) harbour desires to ‘escape’ into the realms of the ‘uber-rich’?  

Unfortunately I don’t have time to discuss this at the moment - right now I need to go do my lottery tickets….

Incidentally, if you want to add your voice calling for greater income equality – then click here and, if you like the look of what you read, sign the e-petition! Needs to get to 100 000 signatures – I was number 290 – so some ways to go!

Of course – expressing your opinion, as is usual in British Democracy, is about as far as it will go – the chances of this petition or anything else related to greater equality actually being converted into action are incredibly remote – especially given the social backgrounds of MPs, with more than 50% of Tories coming from public schools or being Millionnaires.

This provides a potential missing link between system and agency in explaining why inequality leads to violence such as riots… How Growing Inequality Hurts the Middle Class by Robert H. Frank (2007) – Even though it’s not focussed on those suffering real deprivation – if inequality hurts those in the middle this much – it can surely be applied to help explain why the really deprived in unequal societies might occassionally display signs of anti-social behaviour… Of course you may have seen this, but it’s relatively new to me, even though it’s four years old…

Frank offers up considerable evidence that human beings have an innate sense of justice – they care about their position relative to others and feel that if they are not getting their fare share in relation to their peers, then a sense of injustice and negative emotions arise – most notably anger… (taken from the text)
Do you teach kids to care about relative position or do they just discover it on their own?

Why not try the 'orange juice' expt. on your kids?

I was curious and did an experiment with my two older boys when they were young. David was seven and Jason was five, and it was a three day experiment. I gave them each a full glass of orange juice on the first day. I watched them each day. What did they do? Nothing on the first day! I cut them back to a half glass on day 2. Did they complain? “Why did we get only half a glass?” No, they again drank their orange juice without comment. The pay-off was day 3. David got 7/8 of a glass, Jason ¾—what psychologists call a “just noticeable difference,” where you need to carefully make sure there is a difference. Sure enough – I could see Jason’s eyes go back and forth between the two glasses. He could tell it wasn’t going to play out well if he complained, but he just couldn’t bottle it up any longer. He finally blurted out “That’s not fair. He always gets more than me.” We don’t teach them to do that, they just do it.

He goes on to provide an excellent account of evidence for greater equality leading to greater pyschological well-being  

So this is basically to pyschology what the Spirit Level is to Sociology – and I believe that Will Hutton in ‘Them and Us’ builds a similar arguement…although I’ve only just skimmed that book thus far – but while the war against the unread pile may be unwinnable, I think we are making ground in the war against neoliberalism in general and the Tories in particular…Check out the latest Yougov polls for some encouraging signs on this.  

Check out this wonderful piece of research – I guess it’s overt non-participant observation and semi-structured interviews – where members of the Robin-Hood Tax crew sneak into a city-bankers’ party to see what’s going on -

Apparantly the mood is somewhat more subdued than in previous years but the filmakers still conclude that despite the fact that bankers have received billions of tax payers money the following is still the case -

1. Bankers are still making a lot of money

2. The same people as caused the last financial crisis are still at the helm of the banking industry – and it’s business as usual

3. The government apparantly has no power to control the financial sector whatsoever!

The Robin Hood Tax is a proposed 0.05 tax on all financial transactions – that would reportedly raise over £100 billion a year to help pay for – well – whatever Nation States wanted – education, povery relief, combatting climate change…. It’s explained in the video below

I mean it’s hardly smashing Capitalism – but it is something you can support if you want to make the world ever so slightly less unequal!

This latest programme represents a new Nadir in televisual lifestyle viewing. If anything reproduces neoliberal ideology at the level of the lifeworld it’s this - for ‘house’ you can read ‘debt fuelled consumption’ and for ‘win’ you can read ‘competition is good’ – and that’s even before we get onto the subtler normalisation of the construction of the self through the conspicious consumption of material objects and the lampooning of the working class – for details read on!

The show’s web site says ‘May The Best House Win is the daytime ITV1 series (ok I caught it on a Sunday morning rerun) that sees the owners of some of Britain’s most interesting and unusual homes compete against each other in a bid to win a cash prize.’

In each episode four proud homeowners open their doors to each other and let them cast a critical gaze on their property masterpiece – they score the property out of ten and the winner gets a £1000 cash prize.

The one episode I watched witnessed one working class woman (she ran a fancy dress store – so self employed – successful w.c.) in a relatively ordinary house – one upper middle class woman living in a perfectly presented family home (mod cons to the hilt – having a particular fetish for odd taps), an interior designer (at least I think that’s what she was, but frankly I couldn’t give a toss)  living in a flat which she had spent 20 years filling full of arty objects including a mural on of the walls, and in what must be the ironic gesture in world history -a 3 ft tall glittery Buddha,  and finally some woman who lived in a 3 story Georgian mansion with a pool which had featured on footballers’ wives.

The show basically consisted of the working class woman being pilloried by the commentators as she paradaded around the decidely more opulent middle class homes  loudly demonstrating her lack of middle class taste and manners while the other three got all luvy-duv with eacother, by the end of the show they were offering up their deference to the 3 story Mansion dweller (‘ My daughter goes to school up the road’ said the only-middling-upper-middle-class-interior designer- ‘and of all the houses I go past (no doubt in her Chelsea Tractor) this is the one I always wanted to look inside’) 

Incidentally, the working class woman turned up to the Mansion with a general look of disbelief on her face (last to arrive after editing) and was shown walking in the door to the ‘Mr Ben’ theme tune (for those of you that remember Mr Ben*) - no, you should not be incredulous about those that are more successful than you – even if the only way they can afford a house like that is by trading in children’s organs.  

Anyway as if this genre of programmes wasn’t bad enough for giving us unrealistic ideas about the average standard of living this little number ramps things up by overtly lampooning the poorest, working class, member of the foursome invovled.

Lets remember that the norm in British housing is that

• One third of people do not own their own homes!
• 43% of people that do own their own homes are on interest only mortgages and thus struggling to survive.

These programmes can only serve to give us an unrealistic idea of what’s normal and foster negative emotions such as materialism, greed and jealousy – oh and hatred, but I won’t say what I want to do the producers – but let’s just say I’ve thought up some pretty creative uses for that glittery Buddha…

*For those of you don’t Mr Ben was a character who went to a fancy dress shop, put on a certain costume and was transported temporarily to a different world, depending on the costume he was wearing. I remember the ‘space man’ episode being particulary thrilling, although I don’t remember anything about him going to three story georgian mansion land though.

Madagascar - Unlike RBS and Total, they didn't go there for the oil

This could be the worst case of Corporate exploitation I’ve ever seen….

Jeremy Williams from Make Wealth History reports that  the contracts for the country’s oil sands lie with a conglomerate called Madagascar Oil. This company co- founded by the notorious Alan Bond, a man who was convicted and jailed for Australia’s biggest ever corporate fraud. Madagascar Oil is administered out of an office in Texas, and registered in the tax haven of Bermuda.

Funders include Credit Suisse, and French oil giant Total will be assisting on the ground and have recieved finance from our very own RBS. Profits will accrue anywhere but Madagascar itself.

Madagascar Oil has negotiated a deal that sees them keep 99% of profits for the first decade, leaving just 1% for the government’s coffers. That increases to a 80/20 split for the second decade, and a 70/30 share for the third.

As is that wasn’t bad enough –  Holly Rakotondralambo, an environmental campaigner from Madagascar, talking to numerous journalists this week says that

“There is growing concern among local communities about the effects that tar sands mining might have on agricultural land, water sources and the unique biodiversity of Madagascar; particularly since we have seen the devastation that has occurred in the Canadian tar sands mining areas.  There is great poverty in Madagascar.  Many people in the tar sands areas in Madagascar are small scale subsistence farmers who have had their land passed down through their families.  They are afraid that they will lose their land or that it will get poisoned.  There are also fears about the machinery and the huge lorries that will pass through this area to get to the mining sites. There are also concerns that water supplies may be contaminated with toxic pollution”