Low wages equals low growth

I was interested to hear a report on the BBC News that George Osbourne, Chancellor of the Exchequer, (finance minister) will fail to make his target of reducing the borrowing requirement. It is increasing instead. One of the chief reasons for this is that so many people are so badly paid that they do not pay tax. In fact they require benefits in order to support themselves and their families. This is a double whammy for the treasury at a time when the fall in unemployment  numbers has been loudly trumpeted.

I have already described these employment figures as meaningless. The base line has been moved so often it is impossible to get an idea of the true figure. What is certain is that many of these new jobs pay very badly. The national minimum wage has not changed for many years, and is largely unenforced. Many of the jobs are part time on the minimum wage or involve ‘zero hours’ contracts. Worst of all are exclusive zero hours contracts, where no work is guaranteed, but you are not allowed to have other ‘jobs’. With such jobs you cannot get loans at decent rates, including mortgages.

Living costs are rising, so wages buy less. There is a slump in the High Street as many people have no spare cash to spend in shops. This depresses the entire economy. The value of labour is too low and the power too weighted towards the bad employers, allowing for real abuses to occur. Until wages rise and people have money to spend the economy will not recover.

Meanwhile, while the government fiddles the figures, the trust in politics and politicians is at an all-time low. Among working class white men there a huge surge in support for UKIP, almost solely on the myth that the party is somehow outside of the mainstream. This rise of a populist right wing party with links to neo-nazis is very worrying.

There is a long held belief that we are all in the same boat, and that when the water rises we all rise. Not so. Many people have already been thrown out of the boat and are economically drowning. Britain is the only G7 country where the gap between rich and poor has increased since 2000. We have food banks operating and many people are well below the poverty line in a supposedly rich country.

In the USA Warren Buffett was rankled by conservative implications that the President’s attempts to follow the “Buffett Rule” and raise taxes for the extremely wealthy to meet the rest of the nation was “class warfare.” He pointed out that, were it a war, it was pretty unfair since his side, the ultra rich, has the “nuclear bomb.”. In the UK things are worse. Class war has been declared, the rich have hijacked the boat we are all supposed to float in, and the government fiddles the figures while the state burns.

Support the campaign for real jobs.

Campaign for Real Jobs

The latest government figures indicate that unemployment is now under 6%, at just under 2 million. The trouble with these figures is that the rules by which the figures are calculated have changed significantly, many times, over the course of the parliament. Trying to work out the true comparison from four and a half years ago to today is almost impossible. It is like trying to compare apples to bananas.

One significant change was that that of a definition of a job. Almost any form of occupation, even that which is hardly paid at all, or is wholly unpaid, is counted as a job. Many “jobs” are part time, short-term contracts or zero hours contracts. Worst of all are exclusive zero hours contracts, where  the employee is paid by the hour but not guaranteed any work or wage, while still not being allowed to seek other employment.

Meanwhile the cost of living has risen while wages have stagnated.  At the same time, Britain is the only country in the G7 group where the gap between rich and poor has significantly grown during the 21^st century. The Prime Minister’s solution to our economic ills is to reduce spending on welfare while reducing taxation for the richest.

I might believe the existence of real jobs if they had some link to a living wage. This is currently estimated at £14,400 p.a. for a single person. The legal minimum wage for persons 21 years and over is £6.50 per hour, a figure which has remained the same throughout this parliament.  This wage does not allow for having dependents.

What I suggest is that a job should be based on this rather inadequate figure, and that a part time job of 50% of a full time wage should be regarded as half a job. For all part time jobs the percentage of a full time job should be used on the statistics. As for zero hour contracts, they should also be regarded as half a job, unless proved to be otherwise.  I do not possess the figures, the computer models or the analytical skills to produce my own statistics, but surely someone does.

Until these figures can be produced the statistics provided by the government are wholly worthless and unbelievable. There are lies, damned lies, statistics and government statistics. It is time to start a campaign for Real Jobs.

Rising inequality in the UK

According to the Credit Suisse global wealth report, the richest 1% of the world’s population are getting wealthier, owning more than 48% of global wealth, according to a report published on Tuesday which warned growing inequality could be a trigger for recession.

The report, which calculates that total global wealth has grown to a new record – $263tn, more than twice the $117tn calculated for 2000 – found that the UK was the only country in the G7 to have recorded rising inequality in the 21st century.

Warren Buffet has pointed out, “Through the tax code, there has been class warfare waged, and my class has won.”

So a billionaire has admitted that there is class warfare, that it was declared by the rich against the poor and that they have won. So be it. The resistance starts here.

There are more of us than them. We have a democracy and can vote in a government which is prepared to redress the balance. In principal, that is.

To start with, it must be admitted that the Conservative Party represent the wealthy. David Cameron boasted of it in his keynote speech at the recent conference. They also tell an old lie. This one goes: rich people create wealth and jobs. The lie is retold every few years, and it is so easily refuted it is almost embarrassing. Rich people hold their money abroad, have homes abroad and pay little tax in Britain. They mostly either inherited the money or push money around electronically or gamble with other people’s money. The last two groups caused the crash which has so affected the poor, and never suffered. Instead they are just getting richer while the poor get poorer.

The previous government of the  Labour Party, or New Labour, were as much under the thumb of the financial services sector as the Tories are, they just benefitted less personally (well, mostly). If Ed Milliband wants my vote he had better start sounding like a socialist. And he must be prepared to act like one if he manages to get elected.

The Liberal Democrats have too many broken promises from the last election to be believed about anything.

As for the United Kingdom Independence Party, well, where do I start? They are led by the egregious Nigel Farage. He is a man who pretends to be a political rebel, albeit with the support of the second largest circulation national newspaper and several rich backers. Farage did not go to Eton, as most of our senior leaders did, but to Dulwich College, a second rank public school. It produced Raymond Chandler and P G Woodehouse, but they do make mistakes. Farage used to earn a living as a commodity broker until he went broke. So he is as much a scion of the establishment as anyone else, and one who is so incompetent in business that he failed in a business which is like printing blank cheques. Do I want him in charge of the country? Er…. NO!

We still have old class distinctions in this country. We do, after all, still have a monarchy and an aristocracy. This class warfare was declared by the rich against the poor, from sheer unadulterated greed. What we need is the greatest happiness of the greatest number. Having money doesn’t necessarily make you happy, but at least you can be miserable in comfort.

All the boasts of new jobs created over the last few years show one thing. The vast majority of new jobs are part time, short contract or, worst of all, exclusive zero hours contracts. The entire economy is suffering because too few people have too little to spend. As stated previously, the rich largely spend their money abroad. What we need are proper jobs with proper wages. Jobs that allow people to get decent housing, decent food and sufficient warmth.

It is easy enough to deflect attention away from the real causes of our problems. Blame immigrants; blame the EU, blame the European Convention on Human Rights. But don’t blame the Eton/Oxford/Bullingham Club establishment who are the problem and not the solution. Working class white people are suffering and it is easy to appeal to their worst side. UKIP are being successful on a negative ticket, and the Conservative Party is falling over itself to make concessions to the bigots, racists and Little Englanders. The rise of UKIP seems to mirror the rise of Fascism in Italy in the 1920s. It must not succeed. It must be defeated by telling it like it is. The lies must be exposed, and the underlying racism must be exposed. Britain used to be a great country. If UKIP manage to get a share of power we will become a banana republic.

Jobs and employment

Wow! new figures from the government show record new numbers of jobs and a large fall in the unemployment figures. Great!

Oh, hang on a minute, this doesn’t seem to coincide with real experience.

Firstly, the government have changed the way that the unemployment figures are calculated in a breathtakingly creative way over the last four years. They have found ways to frig the figures by changing the rules by which the figures are measured. In order to accurately compare figures you need a baseline which does not change.Now, every government does this to some extent, but the current one is the worst I have known in my sixty years by a factor of ten. There is no way to compare figures easily, and the media roll over and don’t even try.

Then comes the record number of jobs. These include at least 350,000 people forced into self employment, probably nearer half a million. There are zero hour contracts, part time jobs that barely exist and internships. All of these are counted as jobs. If you had three or four of these you would not be earning a living wage. That is what counts. The ability to feed and house yourself and your family.

Now comes the proof of what I am saying. Increases in wages are running at half the increase of costs due to inflation. In other words, even if you have a job, the chances are that you are worse off than you used to be.

There are lies, damned lies, statistics and statistics produced by this government. I am howling mad that no newspaper or radio station is ripping into these statistics and showing them to be the window dressing of a deeply corrupt government. Morally corrupt, that is. Vote out Lord Snooty and his pals at the next election.

I am not in the least apologetic at this rant. Damn them, damn them to hell.