Monday, 16 June 2008

bankers

So lorry drivers are striking again, or where they are not, they're threatening to. It's easy to pass them off as an unpleasant bunch who use their strategic position to make economies suffer, but it's wrong.
They may not even realise it, but they are an illustration of how free market economics has led us towards ever more untenable positions of inequality. I hope they are the first of many groups to protest, as I believe protest is necessary to reorder economic interests in Europe to more democratic ends.

What am I on about? The liberalisation of labour markets possibly helped bring about
the long period of growth and prosperity throughout the 1990s, but while everyone was doing okay, we didn't notice how much better those at the top were doing.
Apparently the average Shell driver salary is THE SAME as it was in 1992, after which Shell contracted out all of its transport (to cut costs). So while the drivers have been stagnating, Shell has been realising record profits.

Simultaneously, top level salaries have been increasing at much faster rates than middle and lower ones across economies. Why? Because people at the top can do it, not because of market pressure. Now unions are more or less neutered, there is no democratic, only financial, power in the labour market. This needs to be redressed.
I would not call for complete economic equality, but it is certainly wrong that the well off should be getting richer quicker than those less well off. Rates of wealth growth should be higher in the poorest - we should be working towards equality, not inequality.

But there is no pressure to do this, which is why protest is necessary. I would even go as far as to argue we should raise import taxes, to protect European industries (while supporting the right of other nations to do the same); this would be a way of protecting higher salaries from cheap competition (or exploitative competition form China, for example. If you think that's rude, do you want to work 14 hour days for a couple of dollars?)



The world of high finance and "big money" has had free reign to make the world as it wishes for almost 30 years now. It has not been a success. Most growth has benefited the most wealthy in the world, while the rest have seen their wealth grow modestly, not at all, or actually shrink, while government safety nets have been dismantled.
Larry Elliot, economics editor of the Guardian, has written a number of good articles about the need to regulate finance; here is one
The populations of Europe and the US should take back democratic control of the economy, and force responsible and fair practice on those industries that have shown themselves willfully inept at regulating themselves. It is time we stopped living in societies where one person earns the salary of 400 others: no-one can work that hard, no-one is worth so much. Especially not while other people live in poverty.
It is perverse.

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