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Gwangjuboy
Joined: 08 Jul 2003
Location: England
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 Posted: Wed Feb 09, 2011 6:28 am Post subject: |
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| Fox wrote: |
| Gwangjuboy wrote: |
Well, I guess that you could argue that, although I think that in the UK real private sector wages have been rising - I am happy to be corrected here. |
From last year.
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Private sector wages fell further behind inflation in Britain than anywhere in the industrialised world except Mexico, Turkey and Iceland as the recession bit last year, according to new statistics.
The Paris-based Organisation for Economic Co-operation and Development (OECD) said the gross average wage in Britain increased by 0.5 per cent to �33,745, which was equivalent to a 1.6 per cent decline after taking account of inflation.
The �financial and economic crisis� was responsible for the higher number of countries seeing real wage cuts, it said, while noting that low-waged workers were particularly vulnerable to losing their jobs, which tended to push up average wage �levels.
The average income tax rate fell by 0.2 per cent in Britain last year, according to its annual publication, Taxing Wages. Overall, aver�age tax and social security burdens on employment incomes fell slightly in 24 out of 30 countries last year.
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From this year:
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Although pay will increase at a faster rate this year than in 2010, inflation will grow even more rapidly, according to consultants Hay Group. There is a risk of the public sector being priced out of the talent market, creating a brain drain from the public to the private sector, Hay added.
Hay Group published its latest research into pay forecasts for 2011 in a report, Reward in 2011, which was released yesterday.
Whereas the Office of National Statistics reported on Tuesday that the consumer price index had increased to 3.7%, a 0.4% increase on November�s figure, Hay estimates pay will increase at a median of 2.5% in 2011.
Analysts, such as the research firm Capital Economics, have also said that the increase in VAT, which came into effect on 4 January, is likely to push inflation higher. |
And here's another for this year:
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Private sector pay could rise by more this year than in 2010, but is still likely to trail inflation, research by Incomes Data Services has suggested.
Pay awards were running at 2.2% in November, up from the 2% rises seen in most of the past year, and IDS predicts pay rises may average 3% this year.
However, this is less than half the rate of retail price inflation (RPI).
The public sector in the UK faces pay freezes in most areas as a result of the government's spending cuts.
While the number of explicit pay freezes has been dropping sharply, IDS expects public sector pay rises to fall from a typical 0.75% increase in 2010. |
I yanked these off of a casual google search. |
I should have been clearer; I was referring to the long term trend. So for example, real wages in the US have been falling since the early seventies, but the same isn't true in the UK. Wages saw a sustained rise until the fallout of the financial crisis, which, as you correctly point out, has ended that long term growth. Still, the inflation statistics are also subject to controversy, so playing devil's advocate I guess you could reasonably argue that they haven't factored into account the soaring costs of rent over that period.
http://21stcenturysocialism.com/article/pay_cut_uk_capitalism_reverts_to_type_02043.html
This link contains some good commentary on real wages in the UK over the long term (the arguments appear well sourced). It seems that from the seventies real wages rose until around 2003 when, especially for the working classes, real wages entered a period of very minor growth, culminating in the considerable fall of wages after the Crisis. Still, depending on whether rental costs are included, the evidence could be even more damning. The quotes below makes a lot of sense I guess:
'It could be added also that after 2003, when wages for low-to-middle-income earners ceased to improve to any significant extent, their conditions of life were additionally propped up by continued increases in expenditure on, and employment in, the public services - also, and massively, now in reverse'
For the past seven years, real wages have been near stagnant for all but the affluent, with living standards for low-to-middle-income earners being propped up by rising tax credits and easy consumer debt - both now in reverse.
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Whether public sector wages are disproportionately generous should be considered based off of the value to society produced by the worker. That's something that can only be evaluated on a case by case basis. Whether or not society can currently afford to pay public sector workers what they're worth is another question entirely. And if it can't, how to best respond to that situation (be it by raising taxes, cutting spending in other areas, or unfortunately laying off workers that are of value simply because they're the weakest link) is yet another. For different public sector employees, the answer will be no doubt different.
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Well private sector workers are the paymasters, and to me it is illogical to expect a checkout assistant at Sainsbury's to subsidise a comparable postion at significantly higher wages in the London Underground for example. Now I agree that you could make a case for an improvement in the checkout assistant's wages, but equally, you could argue that if the housing market was allowed to function properly a disproportionate amount of their income would not be swallowed by housing costs, resulting in an improvement in spending power.
As it happens, I would support increased wages at the lower end of the private sector while advocating reviews in the public sector on a case by case basis. I acknowledge that not every public worker is riding the gravy train. If anything, this problem increases the further you ascend the pyramid. Hospital chief executives and council bigwigs draw some enormous salaries, and in many cases they have refused to take pay cuts to help protect jobs at the lower end. Real team players that they are. |
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Kuros
Joined: 27 Apr 2004
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| Posted: Wed Feb 09, 2011 12:51 pm Post subject: |
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I wanted to respond to a post, but that post disappeared into the aether. Still, I'm going to go ahead.
I've noticed people have different definitions of libertarianism. For me, its a broad political posture meaning right-of-center economically and libertarian socially. Sergio is certainly a libertarian, but he's far more right-of-center economically than I am, and also more authoritarian (I do not share his admiration for the Saudis or the death penalty). Under my definition, Ron Paul is a libertarian, although he's more precisely described as a Constitutionalist. Someone like Gary Johnson is more snugly libertarian, in the sense that he really does fit deep in the right-economic-liberty-social box.
Libertarianism is more than simply about bashing welfare recipients. For me, social welfare is a very venial sin, and in the case of single-payer health care, perhaps even desirable. For Sergio, its a bigger axe to grind. I feel its a general skepticism towards government intervention and power beyond the traditional (and uncontroversial) roles of defense (military), dispute settler (courts), and crime/disaster relief (fire/police/coast guard/etc).
As an American more economically centrist libertarian, I prefer the current stereotypical European continental economy to the American economy. I do not believe the European continental economy is ideal, but substantial taxes and social spending are a minor ill compared to America's rampant corporatism, the drain of our military-industrial complex, and the dubious obsession with economic growth. I view most social welfare and investment as problematic and in some senses poisonous, but the intentions and goals are completely understandable. But I would agree somewhat with Sergio that it creates interests and lobbies that begin to swallow the original intent and mission. In the American context, many Federal programs are controversial under a traditional interpretation of the Constitution (a problem I wouldn't have with many of the exact same German or French social programs).
I personally work with Section 8 recipients at Legal Aid, and I do not look down on any of them. Welfare recipients do not create the programs, and their dependency upon the welfare programs is understandable and usually not their fault. I wish to distance myself from any of strident language on this thread characterizing welfare recipients as lazy or indolent or anything else.
My opposition to welfare lies on Constitutional and policy grounds. It is impersonal. The social liberal desire to improve the community's welfare is laudable and sympathetic. I just disagree with the impulse to make government, particularly Federal government, the instrument of those aims.
Fox is right when he suggests that private charity cannot match the scope of the institution of government welfare. But the War on Poverty still remains a massive failure. Libertarians take that failure very seriously. Again, social welfare = good, state intervention = problematic. Following those premises will not necessarily lead to opposition to all social welfare programs at all times.
Lastly, I want to echo mises' point. The private v. public debate gets far more attention than it deserves. What remains the best policy for here and now needs better attention. |
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Fox
Joined: 04 Mar 2009
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| Posted: Wed Feb 09, 2011 3:21 pm Post subject: |
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| Gwangjuboy wrote: |
I should have been clearer; I was referring to the long term trend. So for example, real wages in the US have been falling since the early seventies, but the same isn't true in the UK. Wages saw a sustained rise until the fallout of the financial crisis, which, as you correctly point out, has ended that long term growth. |
I don't know enough about the situation in the UK to be comfortable arguing it beyond my basic presentation of links which claim that currently wages are on the decline there. If the UK has avoided until the last few years the kind of private sector wage problems America has faced, good on them.
| Gwangjuboy wrote: |
| Well private sector workers are the paymasters, and to me it is illogical to expect a checkout assistant at Sainsbury's to subsidise a comparable postion at significantly higher wages in the London Underground for example. |
This is just a reformulation of the original idea I objected to. I have no problem with the guy in the London Underground earning more than the guy at Sainsbury's, so long as he's providing sufficient value to society to make him worth that wage. If he isn't providing sufficient value, then the answer is to reduce his wages regardless of what the guy at Sainsbury's is making. If he is providing sufficient value, then the fact that the guy at Sainsbury's has accepted a lower wage is totally irrelevant; in such a scenario, if the Sainsbury's employee had a valid complaint, it wouldn't be, "My tax money shouldn't go to providing him a higher salary than mine," it should be, "I'm probably underpaid myself, and maybe I and people like me should do something about it."
The kind of statements you're making here (both the one above and the one I quoted originally) seem more like ideas intended to breed resentment in the private sector against the public sector than any sort of valid starting points from which we can begin to reason. I don't think that's your intention, but that leaves me wondering why you're pressing this concept so hard.
| Gwangjuboy wrote: |
| As it happens, I would support increased wages at the lower end of the private sector while advocating reviews in the public sector on a case by case basis. I acknowledge that not every public worker is riding the gravy train. |
This seems like a good position to me. |
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Unposter
Joined: 04 Jun 2006
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| Posted: Wed Feb 09, 2011 4:35 pm Post subject: |
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I would like to congratulate Kuros and Fox on two excellent posts, well-thought out and argued.
I just want to make one point, albeit shabilly. I would not consider the "War on Poverty" a failure as educational attainment and overall quality of life is better for most Americans since the 1960s. Also, more equal civil rights, especially for African-Americans has also played a very important role.
I think poverty rates in America are due to at least 3 factors: 1) new immigration 2) unequal distribution of resources 3) mental illness.
The War on Poverty created a lot of opportunity that wasn't available before and many Americans took advantage of it but some didn't. I think some of these people are especially hard cases - abused people, mentally deficient people, people with cripling diseases. You combine this with new immigrants and it may seem like poverty levels have not decreased.
Now, while I think the War on Poverty has done a good job in opening the middle class to much of the country, I think current economic policies have created a lot of under-paid employees. Real Wages have decreased for the middle class in the last 30 - 35 years. Tax policy and unequal distribution of the fruits of Globalism have contributed greatly to this as well as a stagnant minimum wage (I know it has increased in the last few years). |
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Nowhere Man
Joined: 08 Feb 2004
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| Posted: Wed Feb 09, 2011 6:13 pm Post subject: ... |
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Kuros,
How is your "libertarian" position different from that of a "liberal"? |
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Gwangjuboy
Joined: 08 Jul 2003
Location: England
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| Posted: Thu Feb 10, 2011 2:38 am Post subject: |
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| Fox wrote: |
| I have no problem with the guy in the London Underground earning more than the guy at Sainsbury's, so long as he's providing sufficient value to society to make him worth that wage. If he isn't providing sufficient value, then the answer is to reduce his wages regardless of what the guy at Sainsbury's is making. If he is providing sufficient value, then the fact that the guy at Sainsbury's has accepted a lower wage is totally irrelevant; in such a scenario, if the Sainsbury's employee had a valid complaint, it wouldn't be, "My tax money shouldn't go to providing him a higher salary than mine," it should be, "I'm probably underpaid myself, and maybe I and people like me should do something about it." |
Well there are two ways of looking at this I guess; either the underground worker is overpaid or the assistant at Sainsbury's is underpaid. When determining public sector pay, I think it is quite rational to look at the market rate for comparable postions in the private sector and work from there. I think this is sensible because the public sector is entirely dependent on the private sector generating sufficient tax revenue to provide for state salaries.
Now an underground worker issuing tickets is doubtless performing a useful service, but is it anymore useful, all things being equal, than someone operating a till at Sainsbury's? Now irrespective of whether the Sainsbury's employee is underpaid, overly generous salaries for comparable work in the public sector further diminish the value of the former's wages as the tax burden necessarily increases.
Still, there's probably more agreement between us than disagreement on this issue as we both appear to agree that low earners in the private sector should be paid more than is currently the case, although private employers could argue that they cannot be expected to compensate for the miserable failure of the housing market - that's the government's fault.
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The kind of statements you're making here (both the one above and the one I quoted originally) seem more like ideas intended to breed resentment in the private sector against the public sector than any sort of valid starting points from which we can begin to reason. I don't think that's your intention, but that leaves me wondering why you're pressing this concept so hard. |
I can understand why you may feel like that, but I genuinely don't want to foster resentment toward public sector workers. I support the provision of public services, but I am persuaded that much more caution must be exercised when doling out tax payers' money than has been the case. |
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akcrono
Joined: 11 Mar 2010
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| Posted: Thu Feb 10, 2011 3:25 am Post subject: |
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Possibly the dumbest thing I've read in a long time. The wealthiest 1% of americans also control 42% of the wealth. Anyone who doesn't see that they should be paying that much in taxes is either ignorant, or a moron.
The disparity between the rich and poor right now is huge. Funny how the bottom 80% control 7% of the wealth. Mabye we should tax that 1% more so these 80% can eat... |
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Sergio Stefanuto
Joined: 14 May 2009
Location: UK
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| Posted: Thu Feb 10, 2011 6:08 am Post subject: |
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| akcrono wrote: |
| Possibly the dumbest thing I've read in a long time. The wealthiest 1% of americans also control 42% of the wealth. Anyone who doesn't see that they should be paying that much in taxes is either ignorant, or a moron. |
According to my link, "the upper 1% of the income distribution earned 19.6% of total income before tax [in 2004], and paid 41% of the individual federal income tax".
In any case, even if it were true that the wealthiest 1% controls 42% of the wealth - or any seemingly disproportionate, rabble-rousing figure - this doesn't really challenge my assertion that the wealthiest 1% do indeed pay 41% of federal taxes. It's a change of topic - a closely related topic, certainly, but nevertheless ignoratio elenchi; and what's more, since it is also used to advance your position that this is what the wealthiest 1% should be paying (if not less than what they should be paying), it's completely subjective, too. I, for example, totally disagree that the rabble are deserving of a single penny more; in fact they are, I think, entitled to considerably less. Yes, public sector parasites - I'm looking at you!
If the rabble are going to use the ballot box to arrogate the wealth of the rich in order to splurge on so-called public services, the rich retaliating (by using the printing press, 0% interest and financial speculation) to arrogate the wealth of the rabble is only virtuous. Mr Rich acquiesces in having 40% of his income confiscated to provide you with things such as disgracefully low quality public schools, so what right have you to complain when Mr Rich uses the Fed to steal your savings in order to fund his cigars, country mansions, yachts and jets? The state has been arrogating from the rich and sharing the loot with the rabble for the past century; it is only tit-for-tat that the rich retaliate and make the rabble pay.
As Basil Fawlty said, "you started it".
If the middle class is not malleable to the demands of the market and insists on remuneration disproportionate to their output, they have only themselves to blame for their economic woes. That goes for so many things - outsourcing, tax avoidance, transfers of wealth upwards, the whole shebang.
| akcrono wrote: |
| The disparity between the rich and poor right now is huge. Funny how the bottom 80% control 7% of the wealth. Mabye we should tax that 1% more so these 80% can eat... |
That's the spirit, comrade. You just bloomin' well demand your "fair share". After all, the poorest 50% of society consuming the vast majority of resources whilst paying comparatively little towards them is an entitlement, an inalienable human right!
My god, do unfunded liabilities of $300,000 per capita not teach you plebs anything about the perniciousness of underproduction and overconsumption, not least the unwisdom of reliance on government to clothe you, feed you, educate you and provide you with healthcare and retirement income? Get on your bikes, before it's too late. |
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comm
Joined: 22 Jun 2010
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| Posted: Thu Feb 10, 2011 11:06 am Post subject: |
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| akcrono wrote: |
The disparity between the rich and poor right now is huge. Funny how the bottom 80% control 7% of the wealth. Mabye we should tax that 1% more so these 80% can eat... |
I don't remember the right to eat being in the U.S. Constitution... More importantly, I don't remember the part where it says the government can confiscate wealth to hand out food. |
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Menino80
Joined: 10 Jun 2007
Location: Hodor?
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| Posted: Thu Feb 10, 2011 3:47 pm Post subject: |
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| comm wrote: |
I don't remember the right to eat being in the U.S. Constitution. |
Yes. This pretty much sums up Constitutional Orginalism, even though you were probably trying to make it look like some kind of brilliant point. |
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Gwangjuboy
Joined: 08 Jul 2003
Location: England
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| Posted: Thu Feb 10, 2011 3:54 pm Post subject: |
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| Sergio Stefanuto wrote: |
| According to my link, "the upper 1% of the income distribution earned 19.6% of total income before tax [in 2004], and paid 41% of the individual federal income tax". |
According to these figures, taken from the Survey of Consumer Finances the top one percent owns 34.3%. Other figures put the figure higher, but I am not sure about their reliability.
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| Mr Rich acquiesces in having 40% of his income confiscated to provide you with things such as disgracefully low quality public schools, so what right have you to complain when Mr Rich uses the Fed to steal your savings in order to fund his cigars, country mansions, yachts and jets? |
I agree with the first part. I support wealth redistribution through taxation, but taxpayers should demand much greater returns on their contributions. It's simply inexcusable that that such vast amounts of money, secured through force, should be lavished on inflated salaries for state bureaucrats; corporate subsidies; the war on drugs; disproportionate military spending; universal welfare; and abysmal education policies. If the government can't get it right, people are going to demand that they spend it themselves.
I would also add that there are many wealthy people who are happy to pay higher tax in principle, so long as it is put to good use.
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| not least the unwisdom of reliance on government to clothe you, feed you, educate you and provide you with healthcare and retirement income? Get on your bikes, before it's too late. |
The government is ostensibly educating people, but if you look at the supposedly educated, in many cases there is little evidence that government is doing a proper job of it. The state certainly has the potential to get it right, but there is zero evidence that it is taking any measures to do so. That is the case in both the UK and the US. |
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Fox
Joined: 04 Mar 2009
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| Posted: Thu Feb 10, 2011 5:03 pm Post subject: |
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| comm wrote: |
| More importantly, I don't remember the part where it says the government can confiscate wealth to hand out food. |
"The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;"
It looks to me like a sufficiently broad interpretation of this justifies exactly what you describe, and the income tax amendment expands on the government's right to "confiscate." Wasn't this the exact clause that was used to vindicate certain New Deal programs? |
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Unposter
Joined: 04 Jun 2006
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| Posted: Thu Feb 10, 2011 5:52 pm Post subject: |
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| It looks like Sergio got owned by Fox. |
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Kuros
Joined: 27 Apr 2004
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| Posted: Thu Feb 10, 2011 6:34 pm Post subject: |
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| Fox wrote: |
| comm wrote: |
| More importantly, I don't remember the part where it says the government can confiscate wealth to hand out food. |
"The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;" |
Yes. That's the Tax and Spending + General Welfare Clause. Add the Necessary and Proper Clause and you have full justification for a Federal Food Aid Program.
| Fox wrote: |
| It looks to me like a sufficiently broad interpretation of this justifies exactly what you describe, and the income tax amendment expands on the government's right to "confiscate." Wasn't this the exact clause that was used to vindicate certain New Deal programs? |
You may be thinking of the Commerce Clause. The New Deal broke the Commerce Clause. But, a Federal Food Aid Program wouldn't affect intrastate commerce.
Last edited by Kuros on Thu Feb 10, 2011 7:08 pm; edited 1 time in total |
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Nowhere Man
Joined: 08 Feb 2004
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| Posted: Thu Feb 10, 2011 6:46 pm Post subject: ... |
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Some more questions:
-Sweden has prospered as a result of free market initiatives. It seems to have prospered from such while remaining decidedly socialist, no?
-No one seems to be defending the notion of charity replacing social programs, so what do libertarian social programs look like?
-It seems that there's a two-pronged attack against bankers and the poor. One is understandable, but it sounds as if the poor are the second most powerful DC lobby. They aren't. If bankers are first, big business is the second. On the whole, big business is being portrayed here as the lil whipping boy that everyone else is unfairly exploiting. Isn't this position a bit milk-toast?
-Monopolies=bad. Hegemons=? The technical non-monopolies seem akin to technical virgins. Some offer this free market dream of anyone having a chance to compete, but Wal-Mart is a good example of how this doesn't really pan out. To wrestle with a gorilla, you have to be a gorilla. Of course, there are emerging markets, but the free market model seems to let gorillas be gorillas. In the case of goods (a la Wal-Mart), that may be ok, but in terms of information and the media (a la Murdoch), isn't that a problem?
-NAFTA model- The free market concept seems more of a promise to secure wealth where it is with a flaccid appendage about how "everyone' will benefit if not prosper from such a change. Give the "parasites" some hope so that we can legislate this. This all sounds fabulous, assuming you're not a parasite. Is it just a coincidence that the fanboys of such change here are a bunch of businessmen?
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As opposed to turning our whole society over to big business, wouldn't we rescale "big government" by getting "big business" out of our government?
Isn't the whole "free market" argument really just an age-old argument against campaign donations and spending?
I think it is: "Big Government" is a product of being bought off. The Rand/Mises solution is to curtail government, but the solution works as easily in the opposite direction: get business out of government.
The Founding Fathers would side with the latter.
Pollution, poverty, and corruption are as old as the pyramids. To say they're the product of socialsim and only socialism is a campaign promise more than anything of real substance. To suggest a free market will end all of that is, well, horribly naive.
Isn't it? |
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