Get a Life not just a Living Wage

I spent Saturday at a conference on the living wage organised by the regional TUC. It seems sad that you need to campaign for the right to earn enough money to live on but this is the reality of the living wage campaign. It was easy for me to agree with it since the Green party's policy is to raise the minimum wage to living wage of 60% of average earnings (currently around £8.10 per hour). The representatives from the Conservative and Labour parties present similarly supported and the living wage, although their parties do not have it as part of their national policy platform.

The idea that paying workers reasonably is good for everybody in the economy is neither new nor radical. It was the idea that enabled Ford's Detroit workers to buy the cars they were manufacturing, and forgetting this important lesson about capitalism is part of the explanation for the disastrous state of Detroit today.

My own presentation was focused on the living wage as a first step towards the end of wage slavery and needless to say I ranged rather more widely than the idea of bringing wages up to a liveable minimum. The beginning of my story was the way the Empire of Capitalism struck back at the end of the 1970s and the huge impact this had on the income dispersion. This is illustrated in the graphic taken from the work of Danny Dorling, which shows the share of total income going to the richest 1% of people between 1918 and 2005. The impact of trade-union activism and increased worker expectations is clear, as is the counter-effect of the Thatcherite ideology and attacks on union power.

My next graphic, based on ILO data, demonstrates clearly the importance of the Tina narrative in persuading workers not to ask for higher pay. It shows the clear indication of productivity increases on a global basis and the fact that the value generated by these workers working harder has been paid in profits rather than in wages. The argument around globalisation was used to persuade workers that they must compete with those in the lowest-paid economies in the world, and that asking for higher wages would destroy their own jobs. The inevitability of a race to the bottom when this ideology is played out is illustrated clearly in the graphic showing wage rates in different countries.

The great disparity of wages across EU countries which are part of the same single market is surely an issue that requires political debate. Why do we accept the very low pay offered to workers in central and eastern Europe? The deal we are offered is cheap goods rather than well-paid jobs, encouraging us to focus on our role as consumers rather than producers. The political economy underpinning this is not discussed but should surely be open for democratic debate.

The gains in wages illustrated in the earlier graphic were the result of solidarity across industries within a market. Globalisation undermined this but if we are to return to international solidarity in a globalised economy then surely a global minimum wage must be our ultimate demand, rather than a low wage, even if a living wage, subsidised by corporate welfare in the form of tax credits.

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There are No Borders to Democracy

A guest post from Rodrigo Silva de Souza, originally from Salvador de Bahia and currently studying for a PhD in London

The recent demonstrations in Brazil began completely unexpectedly and took local and global commentators entirely by surprise. Why should a country that is experiencing its best greatest economic success for a generation, that has addressed its historic problem with hyperinflation and become the sixth largest economy in the world, and which is almost simultaneously hosting the World Cup and the Olympics Games, be faced with such a degree of popular unrest? Considering that football is a national passion, why should the people revolt against their government with demonstrations of popular dissatisfaction inside and outside its frontiers?

The answer lies in the paradoxical model of growth and progress that Brazil has adopted. In spite of being the sixth largest economy in the world, Brazil is also the third most unequal country, with a Gini coefficient of 0.56 (UNDP, 2010); graphic thanks to The Economist. So, although local newspapers want to link current events to the minor issue of an increase of just R$ 0.20 (6 pence) in the standard bus fare, the explanation for the huge scale of the demonstrations clearly lies elsewhere.

Those 20 cents were merely the last straw. People are suffering from corruption; urban violence matched by a failure to enforce the law; the largest rate of tax amongst undeveloped countries without a commensurate standard of public services such as education, health and public transport. Brazil’s popular fear a return of inflation and resent the high salaries of politicians (averaging R$ 17,000.00) compared to the wage of a minimum-wage worker (R$ 600.00) or a teacher (R$ 800.00). The doubling in the cost of the new stadia being built for the World Cup has exacerbated dissatisfaction.

 

In a country renowned for its peaceful and welcoming people, the national mood is ‘they do not represent us’. Since the period of the dictatorship Brazil’s media has been biased and corrupt, and it now shamefully tries to manipulate the population, conveying the protests in Turkey as ‘revolutionary acts’, while protests in Brazil were reported as ‘vandalism’. Meanwhile, the police tried to quell the demonstrations with excessive violence used against nonviolent protesters who carried flowers through the streets of Sao Paulo’s with banners proclaiming ‘no violence’. They were met with tear gas and rubber bullets.

The movement was dispersed momentarily, but what the rulers did not realize was that images and videos, never conveyed by the official media, would be shared on Facebook, and people would not allow the football to distract them from their political purpose. The movement took to the streets of Brazil and has been supported all over the world. The Brazilian people have seen through the illusion of democracy they have been living through and shouted ‘ENOUGH! We are tired of being spectators watching the farce of life in Brazil!’

As a Brazilian I have to say that I have never felt so proud of the Brazilian people. I do not know exactly how far these manifestations will take us, and they cause me anxiety, but I think this is an important first step towards a better future. ‘No more impunity! No more corruption! Change Brazil! We want a better future for our children!’ These claims have invaded the web and the streets of Brazil.

On Wednesday I joined several friends and linked up with Brazilians across the world to support the protests and proclaiming that ‘although distant, we are not apart’ and that there are no borders to democracy. Unfortunately, many things needs to change. The fear is that politicians will silence the resistance in Brazil in a subtle and therefore more threatening way: attending to one or two of the movement’s shallow demands requirements, such as the bus fare reduction, and the movement disperses.

These political demonstrations have been observed with suspicion by a part of the population who no longer believes in change and in their power. Moreover, the official media continues to convey images of graffiti and vandalism of some protesters (who are, according to the leaders of the movement, government and police infiltrators). Thus, comments like ‘Why are we doing this now?’, ‘But we always hear news about corruption and thievery’ or ‘Brazil has never grown so much’  illustrate the identity of a people who have learned to be content with small rewards and no longer recognize their strength.

The important thing is that the people are dissatisfied and have perceived that nothing has changed even after a huge demonstration of public opposition, even when they have reached Congress. A prominent example is Renan Calheiros (a corrupt politician who has become President of the Congress): he is still in post in spite of a Facebook petition signed by many thousands. We have been battered again and again for too long. For me personally the overpriced World Cup was the last straw, for the residents of Sao Paulo it was the 20 cent fair rise and police violence.

This current Brazilian democracy is nothing more than an illusion of people power. Even after the demonstrations, absurd laws continued to be approved in Congress to satisfy the lobbyists working for large companies. FIFA has already overpowered the democratic government of Brazil in arrangements for the World Cup: the streets near stadiums are recognized as FIFA territory within Brazil. Moreover, every politician and minister now receives the benefit of a ‘Cup Assistance’ to watch the World Cup games, which costs the equivalent of a working person’s montly wage for each day for each politician who attends the World Cup and is paid for from taxes.

In spite of all this, I have hope in the future and the possibility of change. Democracy is not made only on polling day or during the election period. It will be good for Brazilians to become more politicized, because for so long we have been led to believe that politics is dirty word and we should keep ourselves far from it, and this is just one more discourse to maintain the domination of the rich and powerful. I have hope if the people stay on the streets and show their strength; if they demand that the media broadcast these demonstration or, better still, if they take control of social media to proclaim: ‘Yes, we can change!’ That is the reason I was here demonstrating on the streets of London yesterday.

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Happy and Glorious?

The BBC's home editor Mark Easton has a fascinating post on his blog exploring the regional relationship between two sets of government data: the recent survey on levels of well-being around the country are compared with regional rates of prescribing of anti-depressants. He finds that there are significant regional variations in the rate of prescription of anti-depressants, as well as interesting relatonships with the self-stated happiness of local populations.

Easton writes that 'Blackpool is the place with the highest use of antidepressants in England - an astonishing 1,430 prescriptions signed for every thousand patients in the primary care trust. The PCT issued 221,000 items with 155,000 people on its books.Blackpool also emerged as England's unhappiest place in last week's well-being survey data, with 36% of adult residents giving a score of 6/10 or less when asked to rate how happy they were the day before.'

The top six places in the league of anti-depressant use are all in the North-East where some of the country's most unhappy people are also to be found. By contrast, as the map shows, rates of prescribing are much lower in London, in areas that also suffer high levels of deprivation. Such correlations are always difficult to interpret, but suggest that the message about the importance of talking therapies is influential, perhaps appropriate, where the chattering classes predominate.


As well as these relationships in the data, the absolute levels of prescriptions for these mind-altering drugs are truly disturbing. More than £270m was spent on anti-depressants last year, up 23% from the previous year. This is a trend that has continued for the past tend years, with numbers of prescriptions growing from 9 million in 2001 to 24.3 million in 2001 and 46.7 million last year. The information we do not have is about how many individuals are involved, since these are numbers of prescriptions, but given the the number of prescriptions written annually for anti-depressants is now about the same as the number of adults in the country, we can assume that a massive proportion of our fellow citizens are not in their right minds.

Once there was great concern amongst science fiction writers about the threat of mass medication: governments adding to water supplies large quantities of chemicals that made populations docile and passive. This would undermine citizens' ability to demonstrate political opposition, and also make them accept policies of injustice or oppression. To what extent can we suggest that the mass prescription of these drugs is already a form of such mass medication? Are levels of disempowerment, frustration and despair leading to a more voluntary version of the same threat? And why is there so little outcry from citizens in response to such blatant evidence of social failure?
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Divided We Fall

It is rather ironic that the main question the media has drawn from the latest publication of Social Attitudes in Britain is whether we are more Thatcherite now than we were in the days of Thatcher. If we were we would certainly not have these data to mull over, since Thatcher was notoriously opposed to social research and abandoned the most valuable tool for the social researcher: the National Child Development Survey, as well as virtually eliminating sociology from our universities.

So having survived the Thatcherite axe the social researchers, though privatised, are still funded to tell us that we care less about each other than we used to and that we have utterly lost faith in our public institutions. While we did hear on the BBC about the fall in support for a government role in redistributing wealth we did not hear about the decline in trust for that institution itself: from 72% to 49%. The politicisation of the BBC has destroyed its role as a public-service broadcaster. The only public institution to have gained trust is the National Health Service. There are no data about the extent to which people's faith in statistics has been undermined by the privatisation of those who seek the data: NatCen (a company limited by guarantee) would have no interest in such a question and its results would not reach a high market value.

This sort of data is, as the Spanish say of history, a field in which all can make hay. I would be interested to see some socio-economic breakdown of the responses to the questions about welfare. It seems that those most vulnerable, including many dependent on benefits themselves, are some of the most vociferous in criticising the dependency culture. This represents another example of the cognitive dissonance that is a necessary skill to survive in late-capitalist Britain.

The media emphasis was on the declining levels of support for redistribution, which was matched by a growing sense of injustice about the unequal way in which hard work is rewarded. This chimes with the findings of another report released this week, by the OECD. Called Divided we Stand it rang alarm bells about the negative social consequences of rising rates of inequality withing societies. Hardly the message one might have expected from the club of the world's richest nations and a traditional cheer-leader for globalisation.

Angel Gurría, OECD secretary-general, is quoted as saying that 'the social contract is unravelling', and this seems to be reflected in the responses to the Social Attitudes Survey as well. The interesting question is why the OECD should suddenly have become interested in the social impact of growing inequality. The real struggle is between the greedy and thoughtless elites and those who realise that capitalism has always relied on the consent of the masses and that without a social contract that consent cannot be guaranteed.
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High Hopes?

Last week the High Pay Commission reported the results of its detailed survey of the structure and culture of remuneration in some of our largest companies. Yesterday's headline in the Independent ('The rich get richer and the poor get poorer') may result from the decisions about public spending made by the Chancellor, yet the origin of the huge increase in inequality in our society is in the way pay setting takes place in the private sector.

Perhaps it would not be going to far to conclude that while the Tory governments of the 1980s and 1990s liberated the private sector to pay top executives out of all proportion to their performance, it is the current coalition government (which has never had a majority of support) that is undermining the redistributive policies that previously held inequality in check.

The graphic illustrates the differences in pay between teachers (£34,476), cleaners (£7278) and higher level civil servants (£163,000), none of whom come anywhere close to the average pay of the CEOs of FTSE 100 companies, at £4,200,000. Perhaps even more striking is the relative increase in the pay of top executives between 1980 and 2011. The Barclays executives have seen their pay rise by nearly 5000%, while those of BP have received increases of more than 3000%.

The report is a useful source of data that helps inform the debates we are having, in these times when the struggle for value within capitalism is becoming more explicit. The recommendations for change, by contrast, are surprisingly weak. Putting employees on remuneration committees is all very well, but unless they are in a majority they are likely to be intimidated and their views dismissed. Similarly, forcing companies to publish pay ratios will aid transparency, but amongst the shameless people who head our companies it is unlikely to bring any change.

A government really concerned about inequality and the pernicious effects of high pay could easily introduce a tax regime that would make pay above some upper limit, say £1m, meaningless, since it would all be reclaimed for the public purse. But then that sort of government would be unlikely to reach power in our less-than-democratic political system.
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Rebalancing, What Rebalancing?

I write this post as a councillor in the local authority that faced the largest cut in its central government funding in the current funding period - a full 28% over this and next financial years. I assume this is a reward for having a Tory council and having just elected a Tory MP, as well as being a debt-free local authority. I have to hope that the good voters of Stroud draw the right conclusions and do something different with their votes next time.

Recent research from Newcastle City Council has made me feel both better and worse. Published in today's Guardian it makes the partisanship of the present government plain to see. Traditional redistribution measures, including the sharing of local authority rents and local business rates, are being abolished, leaving the richer parts of the country free to profit while those in the deindustrialised north in particular struggle. Northern cities and boroughs are losing £150 to £200 per head, while the leafy boroughs and shires of the south lose between nothing and £50 per head.

The inequalities are magnified by the fact that poorer areas are more dependent on public-sector jobs, which are some of the few well-paid jobs in northern cities that once depended on skilled manual jobs. The massive cuts to the public sector will also hit these areas disproportionately hard.

From a macroeconomic point of view this makes plain the massive withdrawal of liquidity from the local economies up and down our country that is taking place. The paradox of thrift is alive and well in Stroud, as councillors and officers alike respond to fear and threats of future austerity by leaving posts unfilled and cutting spending to add money to the growing reserve. The shade of Keynes haunts our council chambers, but nobody is listening.
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