Thursday, 3 July 2014

Up again

Today I've had another massive blast of enthusiasm and energy. It's a little unsettling, how it comes and goes, but it's come and I'm making the most of it before it goes.

So I'm writing something for the first council of the year, and it requires some help from legally minded folks and/or people who know people. And people who know economics. Essentially, I need a lot of help crafting something that we can work on for the rest of the year, and it's going to be something that I strongly suspect is going to cause problems.

On the other hand, nothing's ever gained before it's ventured, so here's the plan: let's make the minimum wage in Scotland £9 an hour. Actually, let's make the minimum wage in the entirety of the UK £9. Let's do it everywhere. Let's start reducing the massive, massive difference in wages between the 1% and the 99%. Let's create a whole new middle class.

Now, everyone who studied economics and believes in the free market is frothing violently at the mouth at this point, because traditional economics says that if labour becomes more expensive, demand for it will go down. This is because labour is a lot like bread, and if bread got more expensive we'd all cut down on toast.

Only labour's not really like bread. Companies need labour to work, and to keep working at peak efficiency they need (presumably) the same amount of labour they currently employ. An increase in the cost of this labour will increase the wage cost, which will reduce the company's profits. That's not an awful thing all round, if the company's CEO is earning a multiple that's 350 times the lowest paid wage-earner, but more of a problem if it's a boutique store owned by one person employing two people.

Here's the thing though - if everyone's got more money, everyone spends more money. Low-income earners typically spend far more than they save, and more spending is great for the economy. Especially because it means companies are producing more than ever, and that means they need to take on more staff.

That's not a bad thing.

And what's more important is that paying people such a low wage makes them desperate. It doesn't make them want to work for you - they always have an eye out for another better job, one that pays maybe ten pence more - because ten pence per hour more is three pounds fifty more a week, is fourteen pounds more a month, is one hundred and fifty-eight pounds per year. And that's not very much, but it'll do for now.

If your employees aren't worrying every minute about paying their bills, they're not going to come in even when they're ill. That's got to be better for your company.

If your employees are earning more money from you, then they could well spend it with you. And if they don't, their friends will. Remember, every one of your workers is wealthier now, and they're moving the money around. The more it moves the more wealth it generates. The worst thing to happen to money is being stuck in a bank account; it begs to be spent.

I am under absolutely no illusion that in the short term this is going to be a hard sell, but I'm also fairly certain that it's possible. If it's possible in America, a country far to the right of Scotland, then it absolutely must be possible here.

This is not a call for an overhaul of the system: capitalism is the best way of producing goods, of creating competition, and basically just employing people. But unbounded, unfettered capitalism has resulted in what we have right now: a minority hoovering up the last few crumbs that were allowed to fall from their table.

Let us have capitalism. But the free market is an illusion; there is no magic spell in it. The invisible hand is so invisible as to be immaterial; no, let us have capitalism for the people. Let us have capitalism that works for the advancement of all, not the few.

This campaign will need voices and it will need data. If you'd like to contribute my anonymously telling your story or taking part in a survey, please let me know - you can get hold of me through any of the links on the right.