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#economicsfest: How can we create an economy that cares for everyone?

Throughout most of history, wealth and power have been held by the few – whether in the form of historical empires or modern-day oligarchs. With healthcare, social care and childcare all stretched, the needs of the many raise pressing questions about this unequal distribution.

This year’s Bristol Festival of Economics, the 12th edition, gathered researchers and practitioners from across the world to address some of the most important economic questions facing the UK.

The second full day covered a wide variety of subjects: the country’s care system, the enduring impact of Britain’s empire, and the global influence of oligarchs. The panellists shared a wealth of knowledge and expertise with eager and engaged audiences.

After empire

The first session of the day was a conversation between Ore Ogunbiyi, co-host of The Economist’s daily podcast and Kojo Koram, author of Uncommon Wealth: Britain and the Aftermath of Empire.

Koram delivered a timely history lesson based on his book, which he hopes ‘is not just about what is happening in former colonies, but also how that mirrors what is happening in Britain today’.

He lamented that much of the recent discussion around decolonisation has been spent on symbolism (such as taking down statues) and personal responsibilities (to decolonise your social media feeds) instead of the systemic issues he would like to see targeted.

‘I felt the conversation was ending with the fall of the statue’, he said, referencing the day in June 2020 when activists in Bristol tore down the statue of Edward Colston, a prominent 17th-century slave trader, ‘instead of focusing on real action’, such as addressing capitalism.

Koram thinks that capitalism cannot be understood without grasping colonialism, as it was driven by economic interests – as opposed to cultural interests. His remark that ‘nobody got on a ship in the 17th century to give people a copy of Persuasion’ received laughs from the audience.

Koram also drew on his personal experience of growing up between Britain and its former colony of Ghana, and his knowledge of history and international law, which he teaches at Birkbeck, University of London.

He and Ogunbiyi discussed how systems of wealth accumulation that were foundational for Britain are contributing to growing inequality today. One example is the non-dom tax status, ‘a direct legacy of the empire’ that has been much discussed since Rishi Sunak became prime minister. They also noted other mechanisms of tax evasion. From Koram’s point of view, the UK government could introduce new laws tomorrow to get tax havens to disclose the names of account holders in such places.

One central theme emerged: a call for better education. Koram criticised the fact that most Britons are unaware of important events related to the country’s history, such as when Kenya, Ghana and other former colonies gained independence.

How to be an oligarch

From the vast riches of empire, discussions moved to the colossal wealth and power held today by oligarchs. David Lingelbach and Valentina Rodríguez Guerra answered questions about their book The Oligarchs’ Grip: Fusing Wealth and Power in a session hosted by Sarah Smith of the University of Bristol and a lead editor of the Economics Observatory.

The authors started by explaining how oligarchs are different from tycoons or strongmen in that they have wealth and power – unlike most politicians or those who are simply wealthy. They differentiate two types of oligarchs: political and business ones (the former use power to gain wealth, the latter use wealth to gain power). Many examples were highlighted – from Donald Trump to Vladimir Putin and Jeff Bezos to Elon Musk (who, Lingelbach argued, became an oligarch when he acquired Twitter/X).

While previous studies of oligarchs have tended to focus on definition and description, the new book focuses on how people become oligarchs. The duo has developed a four-point strategy.

First, oligarchs are entrepreneurial and opportunistic, Lingelbach explained.

Second, they have what he called a ‘friends-with-benefits’ strategy – they are constantly coupling with and decoupling from their (business or political) partners.

Third, they operate in a secretive environment and take advantage of that. Oligarchs are effective at exploiting uncertainty. Lingelbach cited Putin as an example of an oligarch, who although he is one of the most well-known people in the world, manages to operate in relative secrecy. It is estimated there are fewer than ten people who genuinely know him and his thoughts.

Lastly, oligarchs are patient and wait for the right opportunity.

But can oligarchs use their power for good? Lingelbach talked about former US president Herbert Hoover as an example of a business oligarch who used his money to get into politics and whose business acumen enabled him to save about 10 million lives across Europe and elsewhere, as president of the American Relief Administration during the famine of 1921-22.

While Lingelbach drew on his knowledge of the United States and Russia, Rodríguez Guerra, who lives in Colombia, added her research from Latin America to the mix.

After a session spent discussing the shenanigans of many men – alive or dead – an audience member wondered whether there are any female oligarchs. Rodríguez Guerra explained that although there are some – she mentioned Isabel dos Santos, a businesswoman and daughter of the former president of Angola – women are not generally as wealthy as men. But as women gain wealth and power, female oligarchs are likely to rise in numbers.

The caring economy

From the wealth of the few, attention turned to the needs of the many – kicked off by a discussion about the UK’s long-term health and care needs.

Author and activist Cathy Reay started the session by stating that, in her view ‘elderly people are disabled people’. She laid out how the struggles of both groups overlap: they may feel pain, might struggle with movement or hearing and require better access to public services and systems. She stressed how improving access for disabled people would therefore be in the interests of everyone.

Both Chris Salisbury, a professor of primary health care at the University of Bristol, and Patrick Jeurissen, a professor of healthcare systems at Radboud University in the Netherlands, worried that current healthcare systems are not designed for people with co-morbidities (more than one medical condition). They suggested that better digital health services, as well as greater integration of care overall, could improve the system.

Emily Kenway, a writer and activist, stated that unpaid carers are overlooked by the healthcare system, despite the fact that almost everyone will become a carer at some point in their lives. She expects responsibilities to shift with the decline of the nuclear family, where care often fell solely to (non-working) mothers or daughters.

Kenway drew on her personal experience of caring for her dying mother from 2016 to 2020, when she realised the importance of considering unpaid carers within the healthcare system. She also had a suggestion: a four-day working week, which could help free up time for all working people to care for their loved ones in the future.

In a question for the panel, Ogunbiyi considered a shift in how funds are allocated across the NHS, where currently more money is dedicated to hospitals instead of primary and community care.

Salisbury explained this by comparing hospitals to Ferraris: ‘Hospitals are glamorous and exciting, primary care centres are a VW Golf, not glamorous but essential’. Although he calls for more funding for GPs and community care he also sees that hospitals are still short of money.

Could digital solutions plug some of the gaps? While the panel agreed that ‘tech cannot be this panacea or silver bullet that people hope for’, as Kenway put it, they thought it needs to be integrated to improve health and care systems.

So far, most technological innovations have under-delivered, but according to Salisbury, a shift to ‘low tech’ could help. Money has been wasted on shiny apps, but he argued, what is really needed is better communication between hospitals and GPs.

Ogunbiyi rounded off the panel by asking whether the UK should keep the NHS ‘free’ and whether it can afford to do so. Although Jeurissen saw the upsides of a parallel privatised system, the majority of the panel agreed that ‘we can and we should’ keep our healthcare free at the point of delivery.

Modern family

In the final conversation of the day, hosted by Lucy Denyer (The Telegraph), Christine Farquharson of the Institute for Fiscal Studies, Rosie Fogden of the Centre for Progressive Policy, Tina Maltman of Childminding UK and Jane van Zyl of Working Families discussed the economic pressures facing families, nurseries, childminders and playgroups.

The UK has some of the highest childcare costs in Europe, but also one of the lowest birth rates. So, what are some of the biggest problems the country faces for its childcare system?

For Fogden, providing accessible and affordable childcare is key, as it affects both the labour force and the economy. She cited a survey of mothers of children under the age of ten, which shows that about half struggle to get suitable childcare. Many of them say they would have liked to work – a potential loss of £27 billion to the country’s economy.

Maltman said that ‘it would be easy to think that childcare only impacts children, their parents and their family. But it affects the whole economy’.

Throughout the session, the speakers brought together their intricate knowledge of the legal and economic landscape of the current system and referenced examples from across the world.

The themes centred on how childcare can be extended and made more affordable to help parents, but also how quality of care can be assured. The panel agreed that childcare providers, such as nursery staff and childminders, many of whom earn minimum wage, are too stretched and noted that training opportunities have been cut as well.

Maltman stressed that the UK already has a shortage of childcare places and it will struggle with the expansion of free places planned by the current government. ‘I have never seen the situation as dire as now’, she added. Van Zyl agreed that although the government has understood the demand, it has failed to consider the corresponding supply problems.

As the day’s sessions came to an end, while many questions were answered by the panels, they left the audience with plenty of new ones to consider.

Author: Marie Segger, The Economist
Editor's note (24 November 2023): The figure for the potential loss to the UK economy from the survey of mothers of children under the age of ten was updated to £27 billion. The previous version incorrectly stated the figure as £9 billion.
Photo by Franco Troxler for iStock
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