Living wage? This is bargain-basement socialism – Spiked
How do we know if any of these income schemes even work? Guy Standing, economist, author and co-founder of the Basic Income Earth Network, looked at basic-income pilots in the US and Canada going back to the 1970s. He says they led to improved school attendance among poorer families, and also had mental-health benefits while decreasing crime, behavioural disorders and substance misuse. So, UBI is as much about experimenting on people, in essence; as much about managing their lifestyles as about providing a decent standard of income for all.
On the surface, the discussion of incomes seems to be driven by an egalitarian sentiment. We cannot have a CEO paying less tax than the cleaner, says Corbyn. [W]e dont want [to] turn Britain into a bargain-basement economy on the shores of Europe where we continuously reduce corporation taxation [and] encourage a low-wage economy. But it is Corbyns bargain-basement egalitarianism, rather than corporate pay, that is the real problem. Despite the stagnation of wages and rising prices over the past decade or so, it seems that, according to Corbyn, the best we can hope for is putting a cap on what the richest earn. Its hardly inspiring.
At less than five per cent, unemployment today is at its lowest since the 1970s. But wages are growing slowly less than two per cent in the past year and this rise is more than cancelled out by rising inflation. Consequently, living standards are stagnant, if not falling. Much of the new work created over the past decade has been through self-employment. Self-employment levels increased from 3.8million in 2008 to 4.6million in 2015. While this in part reflects a rise in insecure work, and a reluctance among employers to put people on contracts, it also suggests that some are choosing to use their initiative and strike out on their own.
Corbyn, and many on the left, fail to recognise this ambition. This is not about limiting aspiration or penalising success, Corbyn insisted on the day he announced (and then shelved) his maximum-income policy. But it really is. Instead of seeking to impose a ceiling on the pay of the wealthy few, he should be calling for higher pay for all, and much higher than the measly 10 an hour hes now pledging. Corbyns plans reveal the dearth of aspiration in the income debate. The left has given up on dramatically improving living standards and instead just indulges its paternalistic, regulating impulse. Left-wingers today would rather hold back enterprise than unleash it.
These various income schemes are always put forward by academics. But why should they decide what working people get paid? This never used to be an academic question. It was a point of political contestation occasionally even violent confrontation between employers and workers. The defeat of the trade-union and labour movements in the 1980s put an end to that. Today, there is a tendency to look to the state or expert committees to decide what working people should earn. The minimum wage is worked out by the supposedly independent Low Pay Commission and set by government. Dont workers get a look-in?
Today, being a lefty seems to mean defending the tax system and waxing lyrical about fat cats. It is surely time we challenged the assumptions of these supposed champions of people on low incomes. If we are to go beyond the basics and maximise our earnings, then we need to get to grips with the underlying cause of stalled living standards and insecure working lives. We need to be much bolder, and more ambitious, than those coming up with low-horizon schemes. Any new ideas to improve peoples standard of living should be encouraged, but if the British economy cant generate enough well-paid work to go around, it really will just be another academic exercise.
Dave Clements is a writer, public servant and convenor of the Institute of Ideas Social Policy Forum
Picture by: Getty Images.
For permission to republish spiked articles, please contact Viv Regan.
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Living wage? This is bargain-basement socialism - Spiked
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