Jan 14

I chimed in on a guy who wrote a piece in City A.M. that Govt should not raise the minimum wage as this was

  1. against natural laws of free markets
  2. would cause  business to replace Labour with capital

This I said was Zombie economics and actually if true would encourage investment and progress by raising the min wage. His argument was that of the Flat Earth Society. the response was that it was not for Govt to interfere in the Natural world. I said this was dogma. He scoffed that free markets were always called Dogma effectively straw-manning my argument as against free markets. The point is we don’t live in a world of free markets and if they are so natural how come they have almost never existed. Processed Breakfast cereal claims to be natural and it is not.

Thus he is prescribing a solution from a world that does not exist. Why should Govt prescribe a minimum wage? Simply because to not do so would be to create subsidy and bureaucracy. By making the minimum wage a living wage we can save on welfare and crucially working out what welfare is for people on crap like zero hours contracts and low wages every week. The only way to a free market is to remove Welfare and create a Victorian world of de facto slavery?

I know this is to an extent a straw man of their position and they do object but I do find it rich they have apoplexy at the trivial difference a higher minimum wage will cause. Yet stay mostly silent on the big corporations who welcome low wages and Govt subsidy like Tesco to bury small often family 24/7 stores with free Labour that adds nothing to GDP – as they did with Workfare. The idea that full employment on poverty wages doing often tedious menial work will lift a society maybe what George Osborne and the dogmatic claim to believe but it’s simply not true.

Make no mistake a low wage with no limits helps big Capital freeze a Zombie world of low investment, skill-less jobs and wages. It is in effect a call for Luddism. For all their pious claims to otherwise Free Marketeers mostly speak in support of Big Corps and not in reality the dynamic Capitalism they claim to believe in.

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