Alan Manning

Centre for Economic PerformanceLSE

Squeezed Middle, Rampant Rich1

.61

.82

2.2

2.4

1975 1980 1985 1990 1995 2000 2005 2010Year

Ratio of Median to 10th PercentileRatio of 90th Percentile to Median

Not Much Anger, Distrust of Government

Need efficient state so Trade Unions need to show selfless not selfish side

Regulate labour market through individual rights- don’t prevent change

Conclusions

• Squeeze on middle, not time for redistribution to poorest

• Generate more anger about rich, robust policy towards them

• Work with trade unions to protect efficient public services but be wary of them

• Don’t attempt to prevent change, mitigate its consequences