|The 'squeezed middle' has gone from the favoured buzzword of a few columnists to an accepted political fact, almost overnight.|
For much of this year, the Irish media has been clinging to a narrative that the most hard done by group in the country are the so-called 'squeezed middle'. This group, according to Michael Noonan, is comprised of people who earn between €32,800 and €70,000 per year. The story goes that these people shouldered the burden of the financial crisis and are now failing to reap the benefits of the economic recovery, primarily due to the onerous taxes on income they're forced to pay. While compelling media narratives are no stranger to the Irish press, this one seemed to take on a life of its own. Well, with a little bit of help. The main engine propelling the 'squeezed middle' from the favoured buzz term of a handful of middle class columnists to becoming an almost universally accepted political fact was, naturally, the Irish Independent and Sunday Independent newspapers. Article after article and colour piece after colour piece appeared in each throughout the summer of 2016 and beyond bemoaning the plight of the squeezed middle, their high tax burden, the high cost of living and many of the material benefits they could no longer enjoy as a result of it all. The squeezed middle couldn't even afford to send their kids to private school any more! The horror of it!
While there were a couple of interesting points raised in the articles about the squeezed middle - one article by Kim Bielenberg, for instance, bemoans the emergence of the 'gig economy' and the erosion of worker's benefits that have occurred as a result - overall, the general thrust of the narrative and how it was applied to Ireland's class system was crass, wrongheaded and insidious. The first problem was the definition of who constituted the 'squeezed middle'. As we've already seen, Michael Noonan reckoned it was people who earned between €32,800 and €70,000 per year and this was the definition the Irish media used too. But are those numbers an accurate reflection of what middle income earners in Ireland actually earn? Not really. This problem was identified by Unite economist Michael Taft back in October who labeled the hullabaloo surrounding the 'squeezed middle' a "cynical and ill-informed debate". Taft rubbishes the idea that people earning €70,000 a year or even €50,000 a year are members of the 'squeezed middle' and points out that the median income (i.e. the income which fifty percent of people earn more than and fifty percent of people earn less than) is €27,550. A whopping 54% of workers earn less than €30,000 a year. Taft sums it up by writing, "[the debate over the squeezed middle] is led in many cases by politicians and commentators who make assertions without substantiations, claims without facts; all of which leads to policy proposals that are at variance with equity and economic efficiency. In many cases the numbers are just made up to rationalise a pre-determined policy preference."
The second problem with the 'squeezed middle' was the assertion that the middle classes had shouldered the burden of the recession and were liable for some kickback now the recession had rolled around. This flies in the face of conventional wisdom on austerity; when the state slashes public services and public spending, it's the poor who suffer the most. But the Irish press are quick to point out the bevy of new taxes and charges introduced during the recession - from water charges to USC - which they claim disproportionately affected the middle classes. This claim is presented as sort of an inalienable truth, not needing any evidence to back it up. But does the evidence back it up? A recent publication looking at the distributional impact of tax, welfare and public service pay policies between 2009 and 2016 by the ESRI poured cold water on the idea that the middle class suffered the most during the recession. While the publication acknowledges that all income groups suffered enormously throughout the recession, their findings suggest that "The greatest policy-induced losses were for the top income group, at just over 14 per cent, and the lowest income group, at 12¾ per cent". The paper also found that the " greatest proportionate losses, close to 20 per cent, were for single unemployed people without children – mainly those affected by cuts in payment rates for the young unemployed."
|The facts simply don't support the idea that the poorest were protected from the recession.|
While few tears will be shed for the highest income earners having the suffered the most policy-induced income losses during the recession - particularly given the fact that NERI's study didn't look at wealth which is where many high earners have most of their fortunes tied up - the idea that the poorest in our society were hit harder than the middle classes might come as something as a surprise to the columnists of the Irish Independent and Sunday Independent. But it won't come as a surprise to any one who's been paying attention.
|Single parent families and the unemployed were the biggest losers during the recession.|
Indeed, this juxtaposition of the poor and the wealthy as being equally cossotted from economic woe was perhaps the most pernicious aspect of the 'squeezed middle' narrative. It was subtly hinted at in many of the colour pieces that people on lower incomes were better protected during the recession because many of them were outside the tax net. This analysis obviously ignored the deleterious impact cuts to one parent family payment and job seekers allowance as well as changes to indirect taxes such as VAT (which, as a percentage of income, cost the lower paid more) had on the incomes of the lower paid. Instead, conforming to its 'squeezed middle' narrative, it clung to the idea that the poor had been somehow protected during the years of austerity and the brunt of it was born by the middle classes. This, as the evidence shows, could hardly be further from the truth.
That disengenuous message was most clearly enunciated by an article entitled "The poor mugs who carry tax dodgers and freeloaders on their backs" written by Charlie Weston and published in the Saturday Independent back in August. The article, which naturally clings to the patently false idea that the poorest and the wealthiest in society are equally protected from economic woe to the detriment of the middle class, opens with the news that 2,200 jobseekers stopped claiming the dole this summer because they went on holiday. Weston writes, "Many of those who consider themselves to be among the hard-pressed, so-called squeezed middle will allow themselves a wry and doleful simile that those on the dole can afford to go on holidays at all." I'm just going to pause for a second and reflect on the idiocy of that statement. There, done. There are just shy of 300,000 people signing on for the dole in Ireland. If 2,200 of them are going on holiday that means around about 0.75% of people on jobseekers allowance went on a summer holiday abroad this year. 0.75%. Does Weston truly believe that less than 0.75% of middle class families went on a summer holiday abroad this year? I want to give him of the benefit of the doubt but he goes on to say "the fact that so many in receipt of unemployment benefit can afford to leave the country for a summer break perpetuates the troubling belief among the wedged middle that they are expected to shoulder an unreasonable burden, with many others hitching a free ride." Welp.
While Weston's article is obvious nonsense, the image that he crafts of a hardworking, hard-pressed middle class subsidising a life of luxury for the poor is not unique. And it's at the centre of the appeal of the 'squeezed middle' narrative. Because the only solution the journalists of the Irish Independent can muster for the middle classes is some form of tax relief to ease the burden of subsidising those feckless wasters. Any other, less right-wing solution is dismissed out of hand. Earlier this year, the Irish Independent created their own campaign entitled 'Ease The Squeeze'. The thrust of it was that the middle class needed to be given some sort of personal tax break - be that by cutting USC or fiddling with the income tax bands so less taxpayers had to pay the higher rate of income tax of 42%. They even have a section of their website in which all their articles on the squeezed middle are neatly compiled. Curiously, that section of the website hasn't been updated since the middle of October - not a single article has been published by them dealing with the plight of the squeezed middle in that time. Perhaps that might be because, with the budget done and dusted, they feel no need to carry the torch for the 'squeezed middle' any longer.
But the cynic might note that their abandoning of the squeezed middle narrative has coincided rather neatly with the arrival of the public sector pay disputes. Gardaí, teachers and nurses are seeking pay restoration to pre-crash levels and they have been greeted with fury and belittlement from the Irish media, with the Independent titles leading the charge. The thing is, guards, nurses and teachers qualify as members of the squeezed middle. They're middle income earners who endured pay cuts and tax increases during the recession and are now seeking pay restoration. One could easily imagine colour pieces and profiles, of the like which the Irish Independent published documenting the hardship of the 'squeezed middle', dealing with the downtrodden public sector worker and their attempts to claw back what they lost during the recession. But you won't. The reason for this is ideological. The Irish Independent portrays public sector pay increases as wasteful and reckless. They have to be subsidised by other taxpayers, we're told. Tax cuts, on the other hand, are not explored in such terms. Even though they also result in a net loss to the exchequer that must be filled by cutting somewhere else, this is not expounded upon by the Irish Independent. We're led to believe that decreasing taxes is a sensible, even justified measure even though past experience tells us it is not.
It might seem like it's remarkable that the Irish media would spend so much of this year bemoaning the plight of the 'squeezed middle' only to turn so ferociously on public sector workers seeking pay restoration, many of whom are members of the 'squeezed middle'. But there is an ideological consistency here. The Irish Independent portrayed the middle class as being overtaxed in order to subsidise the tax dodging of the rich and the hedonic lifestyles of the lower classes. Their problem is framed through a right-wing lens and so it is no surprise that this is also the case with the solution. The idea that the poor have, along with the wealthy, winged their way through the recession and are enjoying the fruits of the recovery ignores what is actually happening in front of our eyes. Increases in child poverty, homelessness and lone parents and people with disabilities at risk of poverty bear testament to this. But, as always, a "cynical and ill-informed debate" will simply lead to cynical and ill-informed solutions.