Dec 06

Britain boasts it is the fastest growing economy in the developed world. Put aside sneering at what GDP is and means and ask why? It is because we are running massive fiscal deficits? Austerity has been for the poor and even that has proved self defeating as the housing bubble takes more benefit and the NHS has to cope with the increasingly poverty and population. A growing population that is causing a low wage explosion in low wage job numbers – even that is questionable as of course manipulation of Govt numbers is the new little Black dress covering just enough.

People say wages are not rising but the reason is not just lack of bargaining power. It is that wage comparisons do not compare oranges with oranges. Jobs also change. Wages are not rising because of underemployment. There are thousands more people working for the same per capita GDP as 6 years ago. Higher wage jobs have disappeared and been replaced by lower wage jobs. Vast numbers of self employed who knows what they earn or cost the state.

However all this floats: on a massive fiscal stimulous the biggest in the Western World: A massive Balance of Payments deficit: Large and rising public debt with static private debt: ZIRP: and a £375 Bn tranche of unwound QE. The economy is less balanced than ever. Quite how the UK goes forward when the financial capital collapses again, as it inevitably will, is interesting to consider. Can we afford to bail out the banks? If we let them bust what does that mean a quick contraction? Sadly my worry the time is passed for a controlled contraction of the financial parasite. In a country which even state media cares what UKIP’s leader thinks of ostentatious breastfeeding the comedown could be frightening.

The UK will hardly be getting much sympathy with its vile tabloids, warmongering, torture, rendition, arm sales, prodigious whining, polluting and hypercritical sanctimony if the shit hits the fan.

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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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