The Island of Nevis is the most secretive tax haven in the world. Nevis is a solitary volcano in the Caribbean, with a population of just 11, 000, notorious for its involvement in Britain’s biggest ever tax fraud, as well as having been implicated in many other sordid financial scams of modern times, such as when 620, 000 Americans were fleeced out of $220 million in a pay-day loan scam.
Despite its tiny population, Nevis is also home to six domestic banks, one international bank, 18 insurance managers, and dozens of registered law firms. In fact Nevis might well have the highest lawyer to person* ratio on earth.
Nevis is becoming increasingly popular with the world’s rich: since 2012 its financial services sector has grown by a quarter.
Nevis specializes in letting its clients create and register corporations with greater anonymity than almost any other place on planet earth: even the island’s own corporate land registry doesn’t know who owns the corporations registered there.
Companies benefit from further protections: if you suspect a company of having acquired some of its assets illegally, you have to file $100 000 bond with the courts in Nevis before initiating legal proceedings, in order to make sure that no-one makes frivolous claims.
Not that you would have much luck filing a claim against a company registered on the island: Nevis’ regulator holds no information on who owns the companies registered there, or on who owns its companies’ assets.
Then there’s the fact that anyone disclosing financial information without a court order is liable for a $10 000 fine and up to a year in prison. This would serve to put of investigative journalists.
All of this poses a problem for authorities wishing to tackle global crime: if Nevis continues to guarantee anonymity over ownership of assets then there is no way for global crime fighting agencies to trace whether or not those assets have been acquired illegally.
A further problem is that it makes it more difficult for nation states to track down whether large corporations or individuals are dodging their taxes.
Relevance of this case study to A-level sociology
The existence of tax havens demonstrates the absence of global social norms pertaining to tax, and to the relative powerlessness of Nation States to control flows of global capital.
It also suggests support for the Marxist/ World Systems Theory view of globalization. The existence of Tax Havens allows the richest to keep their wealth, perpetuating global inequality. They certainly don’t benefit the global poor!
*some research suggests that ‘lawyer’ and ‘person’ are mutually exclusive categories. Although there’s no actual evidence to back this up.
Sources: The Week July 2018.
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400, 000 children live in such extreme poverty that their parents are unable to afford to buy them their own bed. The 400, 000 figure is an estimate made by the charity Buttle UK.
The charity calculated the estimated figure of 400, 000 based on a sample of the 10 000 families it helped last year. Among those 10 000 families, 25% of children did not have a proper bed of their own to sleep in.
Estimation errors aside for the moment (see below on this), I was altered to this shocking indicator of child poverty by a short item on Radio Kent, and although it has filtered through to mainstream news, it doesn’t seem to be particularly high up the agenda.
The impacts of ‘bed poverty’
As Buttle UK points out… one of the main problems with bed poverty is that it has a negative impact on children’s physical and mental health. If they are failing to get a decent night’s sleep, then they are less likely to be able to concentrate in school.
Then there is the rather grim fact that mattresses or pillows used as a bed, which are stored on the floor, are more likely to be infested with bugs that a mattress on a ‘normal’ raised bed. This means poor children are more likely to be infested with bugs than children with proper beds.
What are the causes of bed poverty?
Well, I guess this is down to the existence of poverty in general in the UK. A bed is one of those relatively large expenditure items that you can live without if necessary, so if you’re one of the nearly 30% of children living in absolute poverty (after housing costs) I guess it makes sense for your parents to prioritize food and heating before a bed.
The ideological choice to cut welfare payments which are part of ongoing Tory policy also obviously help to exacerbate the number of children in poverty in general and in ‘bed poverty’ in particular.
NB – Be cautious about these stats
Although I accept the fact that tens, maybe hundreds of thousands of of children live in ‘bed poverty’, I’m not convinced that the figure is as high as 400, 000. My reasoning is that the charity probably works with the very poorest, and I think that figure possibly uses ‘softer measurements’ of poverty to beef up their claim. (NB this is only a possibility, they don’t actually say in the article which measure of poverty they use to derived the 400, 000 figure!)
Relevance to the A-level sociology syllabus
This is yet another indicator of child poverty, and also probably a new concept (‘bed poverty’) for most students. It’s also a good example of ‘hidden poverty’ – this is a good example of an aspect of poverty that most of us wouldn’t even notice, even though the consequences are severe.
It has obvious relevance to the sociology of education: as explained above, those missing out on a decent night’s sleep will not be able to learn effectively. It’s a classic example of how material deprivation can affect class differences in education.
Finally, although I haven’t discussed it any depth here, this is also a good reminder of the need to be skeptical about the use of statistics – there are different measurements of poverty (relative and absolute), and I’m not actually convinced that the 400, 000 figure is valid. This is a good example of a statistic that is socially constructed and a campaign that possible lacks objectivity, so this can even be tied in to debates surrounding value freedom!
I can’t help but analyse the launching of the Sir David Attenborough polar ship through a social class lens. The whole affair just seems so terribly middle class: possibly even a ritualistic reinforcing of the social class order and a kick in the teeth for the good ole’ working class, as well as for anyone with a sense of humour.
My reasoning is as follows:
124 000 people (most of whom are likely to be working class, because most people are working class) voted to call the ship ‘Boaty Mcboatface‘, however, this democratic decision was overuled by ministers (who are mainly drawn from the upper middle classes) who instead decided that a more appropriate name for a Polar research vessel would be the name ‘Sir David Attenborough’.
I know he’s a national treasure, but he’s a very upper middle class treasure: Sir David Attenborough attended a Grammar School in the early 1940s, before the Tripartite System. As far as I’m aware this basically meant his parents must have paid for him to go there, as at that there were no such thing as as state-funded grammar schools. So a bunch of middle class people decided to over-rule the working class majority’s naming decision and name the boat after a thoroughly middle class person.
I guess all of the above is not surprising: given that this is a polar research ship that’s likely to be chock-full of postgraduate level scientists, most of whom will no doubt come from Russel Group Universities which are, again, chock full of the middle classes (80% are from the middle classes). Add in the weight of cultural and social capital that will bias the selection to a prestige research vessel, and I’d be amazed if more than 5% of the research-crew would be from working class backgrounds.
There is still a ‘Boaty McBoatface’ – but it’s a robotic submarine which can be programmed to go off and do its own research, later returning to the main boat. Just pause to think about the class-related imagery here: the larger ‘mother’ ship has a middle class name, the visible, the regal, the symbol which is to be revered; while the vessel with the name the majority voted for is a satellite, submerged, invisible, on ‘auto-pilot’, servicing the main ‘good ship middle class’.
Or maybe I’m reading too much into this?
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A recent survey of 2000 people has revealed that half of working class people still believed they encountered a “class ceiling” when trying to progress up the career ladder.
The survey was commissioned by conservative MP Justine Greening and conducted across a range of industries and regions. the Putney MP said:
“There is still a class ceiling and it’s clear from our grassroots research that people see it and experience it every day.”
Some of the key findings of the research include:
50% believe those without strong regional accents found it easier to progress in their workplace.
25% said having a regional accent had held them back at work; this figure rose to almost half in London.
Only a third of people said their boss was from a working class background.
working class representation in leadership roles are as low as 17%.
Justine Greening seems like an interesting character: A conservative MP, previously the Minister for Education and the only person to have ever held the position from a comprehensive school background.
Greening has set up the Social Mobility Pledge to encourage employers to adopt open recruitment policies such as name-blind or “contextual” recruitment, and offering apprenticeships to people from disadvantaged backgrounds.
She believes that “Levelling up Britain in this way means talent is what determines how far you go, not simply where you started.
Related Video:
Sources used to write this post/ find out more…
The Social Mobility Pledge
Guardian Article– irritating article about the ‘study’ which fails to provide links to the study.
22% of the UK population, or 13.9 million people live in poverty in the UK (2016). Poverty rates are higher for lone parent households (46%), disabled households (34), and rates also vary significantly by ethnicity (e.g. the Bangladeshi poverty rate = 50%).
In brief, 22% of the UK population, or 13.9 million people live in poverty in the UK (2016). Poverty rates are higher for lone parent households (46%), disabled households (34), and rates also vary significantly by ethnicity (e.g. the Bangladeshi poverty rate = 50%).
Below is a summary of the latest statistics on the characteristics of those living in poverty in the UK. NB These are the latest stats I could find which have been comprehensively analysed by the Joseph Rowntree Foundation, based on their 2017: Poverty in the UK report.
If you can’t see the above chart online (it’s designed to be downloaded and printed off in A3) the it’s all replicated below!
Basic Poverty in the UK Statistics
A total of 13.9 million people lived in poverty in the UK in 2015-16, or 22% of people live below the poverty line, 30% children, and 18% of pensioners. However, there is significant variation between the proportion of working age adults, pensioners and children living in poverty.
What is Poverty?
Relative poverty: the stats in the JRF report summarised here mainly show ‘relative poverty’: when a family has an income of less than 60% of median income for their family type, after housing costs.
A related measure is persistent poverty which is when a person is currently in poverty and has been in poverty for at least two of the three preceding years.
For more details for different ways of defining and measuring poverty please see this post: What is poverty?
Poverty rates by household type
46% of lone parent households are in poverty, twice as many as all other household types.
Poverty Lines
The ‘poverty line’ varies by household type:
Family type £ per week, equivalised,
2015/16 prices
Couple with no children = £248
Single with no children = £144
Couple with two children* = £401
Single with two children* = £297
*aged 5 to 14
Poverty varies most significantly by disability
In 2016 34% of working-age adults in families with disabled members lived in poverty, compared with 17% of those who did not.
Poverty also varies by ethnicity
Approx. 2016 rates for working age adults Bangladeshi – 50%, Pakistani – 45%, Black British 37%, White – 19%.
Find out more…
There are other variations in poverty highlighted by the JRF report (link above), I’ve just selected the main ‘in focus’ trends as things stand in 2017.
NB on the ‘data lag’ – that’s just one of the problems of Official Statistics more generally – most of the data above has been analysed from various different types of government stats, which are already a year out of data before the ONS publishes them, then you have wait further for the JRF summary. If you want the 2018 stats, you’ll just have to wait til 2019!
If you like this sort of thing, then you might also like my previous post on ‘Poverty Trends’ in the UK, which looks at how poverty rates changed between 1996 and 2016.
How do we explain the long term decline in UK Poverty rate, and its more recent increase?
The UK has seen significant falls in poverty over the last 20 years, HOWEVER, this progress is now at risk of reversing as poverty rates have been increasing in recent years. This blog posts summarizes the 20 year trend in UK Poverty according to the Joseph Rowntree Foundation’s 2017 Poverty Report. Specifically it looks at:
The overall 20 year trend in UK poverty
poverty among pensioners and children
Three drivers of the reduction in poverty rates
Three threats to the continued reduction in poverty rates
NB I’m using the same information from the report, but I’ve changed the order in which it’s reported and summarized it down further. Personally I think my version is much more immediately accessible to your ‘non-expert’: IMO the ‘JRF have a tendency to ‘over-report’ reams of nuanced data, and the overall picture just gets lost. The detail’s important if you’re a policy wonk, but probably going to get lost on the average, interested member of the general public.
Before reading this post you might like to check out my ‘what is poverty?‘ post which covers the basic definition of some of the terms used below.
The overall 20 year trend in UK poverty….the fall and rise of UK poverty rates
20 years ago, in 1996, nearly a quarter (24%) of the UK’s population lived in poverty. By 2004, this had fallen to one in five (20%) of the population. However, by 2016, the proportion had risen slightly to 22%.
*Relative poverty is when a family has an income of less than 60% of median income for their family type, after housing costs.
Children and pensioners living in poverty
As the chart above clearly shows, the biggest success stories in the long term reduction in poverty over the last 20 years are the numbers of pensioners who have been taken out of poverty and (to a lesser extent) the number of children.. As the chart above shows:
In 1995, 28% of pensioners lived in poverty, falling to 13% in 2012, but rising to 16% by 2016.
In 1995, a third of children lived in poverty, falling to 27% in 2012, but rising to 30% in 2016
However, during that time the proportion of working age couples without children in poverty actually grew slightly, from 16% to 18%.
Factors correlated with falling poverty rates
The report notes three main factors which are mainly responsible for this long term overall decline in poverty:
Rising employment, linked with higher wages due to the minimum wage, and better education.
Increased support through benefits, especially the increase in the state pension age, but also out of work benefits for working age people with children
Housing benefit and increased home ownership containing the impact of rising rents.
Factors explaining the long term decrease of UK Poverty in more depth
It seems that the main drivers behind the long-term decrease in poverty in the UK are the ‘positive’ economic factors such as improvements in the employment rate, pay and conditions, rather than increases to benefits.
Below I select what appear to be the five most import factors from the report which explain the long term decrease in poverty.
The increase in the state pension
The most significant reduction in poverty has been achieved with pensioners, and according to the JRF report, the main reason for this was a one off increase in the state pension at the beginning of the century:
NB – there is a lot of variation in pensioner income, which I may explore in a future post…
The employment rate has increase from around 71% in 1996 to around 75% in 2016…
NB – while you are statistically more likely to be in poverty if you’re not in-work, being employed it itself is not sufficient to avoid being in poverty. Both the introduction of the minimum wage, and changes to in work benefits for lone parents have been essential to making sure that a higher proportion of people in employment are also not officially in poverty. While work today is more likely to lift you out of poverty than in 1996, it remains the case that a large percentage of those in poverty are in-work (typically in part-time jobs).
Earnings are up for people with all levels of qualifications…
Obviously higher earnings are more likely to lift people out of poverty, HOWEVER, at the bottom end of the income earning scale, and especially for those with children and in part-time jobs, the increasing cost of living, especially rent (but also childcare and even food and utilities) has negated much of the above increase in wages, hence why government support in the form of child tax credits and housing benefit remains important.
The number of people with degrees has nearly trebled in this period: from around 12% of the UK population to over 30%
Those with degrees earn approximately twice the amount of those with no qualifications, so it would seem that New Labour’s focus on ‘education, education, education‘, and their push to get more people into higher education has had a positive impact in poverty reduction. However, with the introduction of tuition fees and with increasing competition for highly skilled jobs coming from abroad, it’s not clear that this trend (of more and more people getting degrees) is set to continue.
The introduction of the national minimum wage has resulted in a 46% relative pay increase for the poorest 10%, compared to a 40% median national increase
Both the introduction of the minimum wage and its subsequent increases seem to have been one of the most important factors in tackling in-work poverty. However, even with the minimum wage, a possible future barrier to further poverty reduction lies in the growth of precarious jobs leading to ‘underemployment’ – where people get too few hours to earn a decent living. For more on this, see my summary of the RSA’s report on ‘Future Work in the UK‘.
The increase in out of work benefits for people with children
Basically, there has a been a very slight long-term increase in out of work benefits for people with children, who are now slightly better off than 20 years ago, while poor people without children have seen no change, or are slightly worse off.
I guess this leads to an overall reduction in the poverty rate simply because there are more people per family household rather than just couple or single person household.
You can see from the above chart, that lone parents claiming JSA and child benefits were briefly lifted to 60% of median income (just on the poverty line) – sufficient to take them out of poverty, however, you can also see that benefits are again being cut back, so we can probably expect poverty rates to increase again in the future!
And one factor which doesn’t seem to explain the overall reduction in poverty… changes to in-work benefits…
With the exception of single parents who are better off over a twenty year period, every other household type seems to be worse off! Thus I can’t see how this variable would explain the long term decrease in UK poverty.
Potential barriers to further reductions in poverty
All three of the main drivers of poverty reduction mentioned above are now under question:
The continued rise in employment is no longer reducing poverty.
State support for low-income families is falling in real terms, and negates the gains made by increasing employment and wages.
Rising rents, less help for low-income renters and falling home ownership leave more people struggling to meet the cost of housing.
Professor Green’s fronted an excellent recent documentary on the lives of 6 white working class men for Channel Four, which aired in January 2018.
In an interview with John Snow (about the documentary), Professor Green (who is himself white working class) says the show was born out the fact that only 10% of white working class men will go to university, and this show sets out to explore some of the problems 6 of these men face in just ‘getting by’ in the world today.
It’s well worth a watch: in the first episode he follows one young man whose parents both died when he was 17, and documents how he’s effectively slipped through the welfare net; another guy whose living with his nan, and is something of an entrepreneur, and a guy who has an offer from Cambridge, and has basically re-crafted his entire image so he looks and sounds ‘posh’.
Possibly the most depressing moment is when Professor Green attends a Britain First Rally.
He says of the experience that he didn’t want to give them a voice, but how else can you understand the white working classes without at least listening to them…. at one point he says in the documentary that maybe the reason for the growing popularity of Britain First is that ‘whiteness’ is all working class men have left, and thus they cling to it?
From a methods point of view, this is also an excellent example of Interpretivist style unstructured interviews, boarding on participant observation.
Venice is a city of 55.000 inhabitants, which is swamped on some days by more than 40, 000 cruise ship passengers, and many of the residents aren’t impressed at their transient visitors, as many of these ships dwarf the architectural marvels of the ancient city, and spew toxic fumes in their wake.
And Venice is far from the only place affected in this way – the Orkney Islands play host to over a quarter of a million visitors a year, with a population of just over 25 000.
The Cruise ship industry has grown rapidly since the 1960s as prices have come down – Americans and the Chinese are the most avid cruisers, but 2 million Brits are also predicted to go cruising in 2018.
The largest ship is Harmony of the Seas – it is a quarter of a mile long, weighs 227,000 tonnes and carries up to 6780 guests with a crew of 21, 000, and there are scores of ships sailing the oceans which have a capacity of over 3000 passengers.
What can we make of cruise ships sociologically?
As with many current trends Zygmunt Bauman seems to be the best sociologist to go to in order to make sense of their growing popularity:
Bauman argues that what distinguishes social class today is relative mobility – the global super rich have jets and suites in many parts of the world and can afford to be instantly globally mobile. At the other end of the scale are the global poor – who are ‘doomed to be local’ in Bauman’s words, and are effectively stuck in the barrios with no way out.
So where do cruise ships fit in? Basically I see them as somewhere in the middle of this – they allow the relatively well-off in the West as well as in developing countries like China to get a taste of this mobility, so maybe, just maybe, it’s not so much that cruises are a ‘good holiday’* but they allow us to tap into that unconscious desire to join the ultra-rich super-mobile global elite?
*Given that the objective truth about cruises is that, technically speaking, they’re just a bit shit, why people ‘choose’ to go on them needs some deeper level of explanation.
In July 2016 Theresa May gave a speech on the steps of Downing Street in which she proposed to build a ‘country that works for every one of us’ and not just for the ‘privileged few’.
The chairman of the Social Mobility Commission, Alan Milburn, accused the government of being so preoccupied with Brexit that were failing to address the poverty and lack of mobility that led so many people in poorer areas to vote for it in the first place!
Earlier, the commission’s report had identified 65 social mobility cold spots, of which 60 had voted to leave the EU.
400, 000 more children have fallen into poverty since 2012 to 2013, according to the Joseph Rowntree Foundation, which is a direct effect of Tory benefit cuts: when you are suffering material deprivation and having to do your homework in cramped conditions then it puts you in no position to be able to compete with richer kids who will have their own private study space at home.
Then there’s the fact that kids from richer households are twice as likely to get into outstanding schools as kids from poorer backgrounds, suggesting that this route to social mobility is ineffective, while Oxford remains an institution which seems to perpetuate class privilege.
So, if we’re judging Theresa May’s and the Tory’s commitment social mobility on their social policies, they clearly are not committed, which suggests they don’t give a stuff about the poor.
Sources
The Week (Print Edition, 9th December 2017)
(1) An alternative interpretation of why they resigned is that they all spontaneously realised the methods behind the report were a bit rubbish (the technical term escapes me). In that it didn’t actually measure social mobility, as such! OOPS!
Here a few visual updates and links which highlight the extent of class inequality in the UK today…
1.In Education… 3 year olds from the richest fifth of households are twice as likely to be ‘school ready’ than 3 year olds from the poorest fifth of households
2, by health – This is a nice, if dated article which reminds us that Based on 2007-2009 mortality rates, a man aged 65 could expect to live another 17.6 years and a woman aged 65 another 20.2 years. This graphic demonstrates that men and women from routine manual backgrounds are twice as likely to die before the age of 64 than those from professional backgrounds(my title is clearer than that in the picture!)
4. Births outside of wedlock (not that I think the decline in marriage is a bad thing!, unlike the author of the post where I got the info!
The chart below shows the proportion of kids who are born outside marriage by social class in Britain. Its quite a short period of time, but you get the general idea. At the top, things haven’t changed much. At the bottom, having children inside marriage is not the norm, and increasingly rare.
