Brian Booth: Of elevators and wages

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Evaluation: 4/5 avec 4 votes

Publié jeudi 17 avril 2008 à 10h13
par brianfrombrussels Devenir militant(e) du PSE dans La nouvelle Europe sociale (vu 520 fois et 3 commentaires)

For people who like to know what their fellow earthmen think of the world's affairs, nothing can match an elevator. Your local pub or the back seat of a cab are close competitors for sure, but still they don't quite make it in front of an elevator. Well, perhaps I'm biased, considering that I happen to spend more time in elevators than in cabs or at my local lately.

Anyway, every month around the 15th whatever elevator I take, the conversation between commuters seems to roll over the same topic: the rent is paid, electricity and heating bills are gone and various other charges dealt with and... well, so is the month's money. Gone, vanished, not a euro in front of them - not to mention any to be put on the side in prevision of worth days to come. It seems that the only power left to the working class in our liberal society, that is the purchase power, is melting away like wax under the sun. And the regulars of my elevator are usually civil servants, mind you. I guess you'd hear less pleasant stories from elevators with a very different attendance - steel workers from Mr. Mittal's group, for instance.

Even from the most cynical point of view, this can't go on. The driving force behind our western economies is consumption. If the people don't have the money to consume, well, it's quite easy: the system collapses. And it's not the indecent salary raise that some CEO allows themselves that will boost Europe's growth.

So what's the way out?

  • First of all, some political control over the European Central Bank wouldn't hurt. This institution being only concerned with the limitation of inflation can only be essentially opposed to any policy threatening to re-launch the inflationist spiral of salary and prices.
  • Setting a European Minimum Wage above the poverty line in the member states is something we can't escape. It doesn't have to be, at the start, the same figure everywhere. It could be a fraction of the national average wage or something of the like. But with the infamous convergence criteria, supposed to lift up and harmonize the living conditions in the Union, shouldn't it be a matter of time before this Minimum Wage becomes an identical one across the EU? (well, yes, I can be sarcastic now and then). Anyway, that's also what we have to aim at if we want to put an end to the socially harmful competition that rages between member states at the moment.
  • The last logical step would then be to automatically link salaries and the Minimum Wage to a barometer of prices, thus protecting the purchase power of the working class (oh yes, and giving a stronger basis for Unions to bargain salary raises).

And to put it in the word of Marx (Groucho, this time): Those are my principles and if you don't like them... well, I have others.

Tags: blogueur de la semaine, salaires, travailleurs

Commentaires

1. Social europe, dynamics and subsidiarity par davidmas Devenir militant(e) du PSE le vendredi 18 avril 2008 à 14h40

 I really like your proposition of setting a minimum wage that may vary accross europe, but is bound to converge. Too offten people (at least french socialists...) think in static terms and are affraid of setting a global european minimum wage that would for sure be lower than the  french minimum wage. This type of argument is usually pushed forward in order to prevent europe to have any power on social matters.  In my opinion, having just a single market and no social norms (even heterogenous, but converging ones) can only lead to social dumping.

 I wish than someday people understand that harmonising social norms can be a dynamic process, not just a setting of uniform norms across Europe, and that there exists another fundamental principe in Europe thats prevents Bruxel to act in the place of the national governement for matter that only concern a given country : subsidiarity. Maybe then we could design an efficient european social legislation.

 As an economist, I would also like to say a few word about ECB, inflation and wages. Independance of the ECB minizes inflation, and thus protect the purshasing power of workers. On the contrary monetary policies usually balance inflation and unemployement (inflation is lowering real wages, thus allowing firms to employ more people), they would have no effects if wages are indexed on inflation. From my point of view, your first and your last point seems contradictory.

 I believe much more in investment in new technologies and in efficient bargaining between unions and share-holders to raise both wages and employement. Investment in new technologies clearly calls for legal and or fiscal incentives, but also for direct investment from governements. A real european budget could be of some help for a european investment policy. And efficient bargaining between unions and share-holders can only take place if social norms and legislation gives workers suitable protection.

Why should all this be done at the european level ? Because the european internal market is big enough to attract investors, that will be willing to accept any costly social or ecological norm to make some profit here. Europe has the power to set norms that no single state could sustain without hurting his economy. Europe doesn't have to be a social one, but there will be no sustainable social protection in Europe without a social Europe. 

2. Simple answer: reduce taxes par davidvaughan le vendredi 18 avril 2008 à 19h09

Brian, it seems to me that the best thing would be for governments to reduce taxes. This would have several beneficial effects on the problems you raise.

1) It would allow people to consume or save more according to their personal priorities - hence it would increase freedom and "save" the system of consumption you mention.

2) It would put less money in the hands of wasteful governments - I don't know if you saw recent reports in the UK media that over 100 construction firms are under investigation for fixing prices when tendering to carry out public works.

3) It would encourage personal philanthropy (there's a general tendency for lower-tax populations to give more of their money away to good causes).

4) It would save you having to listen to people complaining in front of the elevator on the 15th of each month!

Regards.

3. If only it was so simple.... par davidmas Devenir militant(e) du PSE le vendredi 18 avril 2008 à 20h33

1) It's clear that as far as personal interrests are concerned, it's better to let people decide for themselves. But what about collective interrest ? I'm afraid it's something more than just the sum of personnal interrest.

2) If governement are wasteful, why the hell are we bothering about politics ? let the market decide, for god sake !

 3) It's true that people are usually happy to give money to the other : for instance they love to pay taxes !!!

 4) Ah listening the other, it's so bothering. Let's get rich, buy a house and build a huge wall around it so we can at least be alone.

 I think that our friend davidvaughan may have made a mistake. The PES is a left party. We may recommend to lower taxes, but only if their level is so high that they become inefficient. Certainly not because we don't trust governments : we do believe in government action.

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