Saturday, 28 January 2012
It is as if the Labour Party had never existed!
The revelation by the BBC yesterday – that the share of all income in Britain, by the richest 1%, is on course to return to the same level that it was when Keir Hardie and others established the Party just over a hundred years ago – is depressing, not only for the lower paid, but even for those on above average pay!
Some of the quotes in the article, from Professor Danny Dorling, are disturbing:
“Even within the richest 1%, inequalities are now enormous.
At the lower end of this tiny group of high earners, Prof Dorling says you find people earning £120,000 a year.
But the richest thousand individuals leave them far behind.
They saw their wealth increase on average in 2010 alone by £60m. That was a 20% gain, following 25% the previous year.
In November, the revelation of the size of the increases enjoyed by chief executives of the 100 largest companies on the London Stock Exchange triggered the most political anger.
The High Pay Commission reported that these executives’ total pay had risen by 49% during the previous year alone, compared with average increases of less than 3% for their employees.
The rise left the chief executives with average pay of £4.2m. That was 145 times the average pay of their employees and 162 times the British average wage.”
There are of course many other achievements that have been made by the Labour movement during that time. These remain through employment and other laws. However, these too are gradually being eroded by Cameron and Osborne.
That said, as far as the majority are concerned it is their take home pay that is of most importance.
Although Cameron has promised to move against undeserved pay awards, few expect this to have any real effect – for most recognize that this surge in executive’s pay is a direct consequence of our ruling elite’s eagerness for Britain become fully engaged in the global free market. Whilst this is the case the gap will continue to increase rapidly.
The movement is back where it started and, unfortunately, cannot use the threat of demonstration or strike action as before because the free global market allows employers to move jobs to Poland, or another former Soviet state, where wage rates are lower than in Britain and worker’s rights less well established – or if this is not viable – to a nation in the Far East, where incomes are even lower.
Ed Milliband may be able to tiptoe to the next General Election in the hope that, by then, the voters will have become fed up with Osborne’s harsh medicine. Particularly as it is unlikely to have made much of an indent in the structural deficit. Too few British companies are competitive in the global market and high unemployment, with its attendant costs, will further increase our need to borrow. However, the Party’s growing reputation for causing the economic crisis through lax financial controls will make it very hard for it to return to power in the short-term.
Long-term, whilst we are so heavily committed to the global free market, the gap between the rich and poor will continue to grow with job security being eroded and unemployment remaining high – unless wage rates are cut. Milliband may as well bite the bullet, now, and introduce those policy changes that are necessary – if full employment is to return along with a greatly reduced gap between the highest and lowest incomes.
We need to reduce our exposure to this global market by discouraging the global monsters from trading here. This requires high tax rates for the very highly paid and an incremental scale of corporation tax. Both of these measures will encourage these corporations to site their main EU offices outside of the UK.
We must leave the EU and the single market, where our exports fall so far short of our imports, if we are to escape these monsters – so that we can introduce some import controls to give UK industry a chance to recover before it has to face impossible competition. We also need to cut immigration to the bone to prevent employers taking advantage of cheap and compliant economic migrants to keep wage rates low.
Some form of direct democracy is also probably needed to ensure that future governments consult the people before invading other nations or international treaties, like the Lisbon Treaty, are ratified.