The elite’s excuse for opposing a living wage

Written By: - Date published: 11:52 am, February 15th, 2013 - 66 comments
Categories: class war, jobs, wages - Tags:

Don’t you love hearing the rich say the working poor can’t have more pay? The faux concern that higher wages cost jobs from the same people who support huge executive pay packets and tax cuts? If you really believed higher wages meant fewer jobs, you would cut the CEO’s pay in half, not dick around over a few dollars an hour for real workers.

Of course, the truth is more money in working people’s hands means more demand for the basics, meaning more jobs. It’s well-established empirical fact. Anyone who argues otherwise is just using a false justification that masks their real – much less altruistic reasons – for wanting the poor to stay poor.

Well, let’s test them. How about this – the 44 top paid CEOs in the country get over $62 million between them. Halve that and you’ve got enough for over 800 living wage jobs. What do you reckon, righties? If you really honestly believe higher wages leads to unemployment, you’ll join with me in calling on those CEOs to take 50% less of the ungodly amounts they’re paid and put 800 Kiwis into work with the savings.

No? Don’t support that? Just want to sanctimoniously tell the working poor they mustn’t have more pay and give bullshit excuses about job losses when what you’re really worried about is making sure the labour cost in your retail goods and restaurant bills doesn’t go up, and, of course, in maintaining the gap between you as the wealthy elite and the poor?

Because, really, what’s the point in being rich if there’s no poor to look down your nose at?

66 comments on “The elite’s excuse for opposing a living wage”

  1. Stan 1

    You will never ever get rid on inequality, it is a fact of life. Orwell was quite right when he said all men are equal but some more equal than others.

    • Colonial Viper 1.1

      Sure you can get rid of inequality, an 89% tax rate on all incomes over $500K pa will do it.

    • One Tāne Huna 1.2

      Stan, are you familiar with the concepts “greater” and “lesser”? Next, imagine that there can be “greater” and “lesser” degrees of inequality.

      Next, imagine that not only can inequality manifest in these so-called “greater” and “lesser” amounts, but that its level can actually be quantified.

      Then you might avoid coming across as a complete idiot.

    • Lightly 1.3

      Orwell wasn’t saying that inequality is an immutable law of nature. In fact, he was satirsing those who do.

      “All animals are equal but some animals are more equal than others” is a line used by the corrupt new rulers (the pigs) in Animal Farm to justify their privilege

      You illiterate dork

      • Lightly 1.3.1

        the more I think about it, the more stunned I am that you think that Orwell was saying inequality is normal and unavoidable.

        You’re probably one of those idiots who reads (or, more likely, doesn’t read) 1984 and thinks that Orwell was an anti-communist rightwinger.

        In fact, he was a life-long socialist, but he was also an anti-totalitarian and elitist government, whether it came in the form of fascism, communism, or capitalism

    • Tom Gould 1.4

      Indeed, and if all the hard left can come up with is ‘eat the rich’ nonsense like this, they will always struggle to get it up. What a sick joke to suggest that the pay of 44 people out of 4.5 million is the reason some people are poor. Ridiculous. No wonder these class warriors are so bitter and filled with rage and despair. It’s always someone else’s fault. Their glass is always half empty, unless its a chardy while plotting the revolution.

      • One Tāne Huna 1.4.1

        When are you going to stop molesting Mr. Strawman?

      • Tom and Stan are busily avoiding the point by suggesting that inequality is inevitable. It may be but this does not mean that we have to accept there being more and more of it.

        • Colonial Viper 1.4.2.1

          Well that’s right…they’re being pedantic…If you get paid $25/hr MS and I get paid $20/hr they get to call that “inequality”.

          And they would be right.

          But its not a circumstance where you make more in one week than I make in one year. Which happens far too often today.

      • Lefty 1.4.3

        Indeed, and if all the hard left can come up with is ‘eat the rich’ nonsense like this

        Whats wrong with eating the rich?

  2. Ennui in Requiem 2

    Zet, lets just look at it slightly differently: these individuals work for organisations that effectively tax us. Like telcos, banks, power companies and yes, government departments. They are NOT capitalists, they are the top functionaries. They take no risk with their own money, they don’t generally own their organisation. And they garner the cash because their organisations can “clip the ticket” on pretty much everything.

    They are generally rent seekers, they generally provide no new value to any transaction, in short they are parasites. Smaller business can do without them. And the “consumer base” (aka citizenry) would be well rid of them.

    Your suggestion of halving their income to create jobs is obviously not going to happen, BUT that is no reason why their salaries (and the whole cadre of “managers” within these “tax empires”) should be paid more than the rest if us. A direct result of paying them the same as our meagre rations is that the size of our bills from their organisations should go down.

    • NoseViper (The Nose knows) 2.1

      EnnuiinR Hear hear! How could we decouple the salaries? We would have to get rid of the Higher Salaries Commission or whatever. Would that require legislation or something less – say an order in council or whatever. And requiring a good return from SOEs as government does, should include a salary cap from the top echelon. Those who think they are worth more on the overseas market can bu..r off there and we will train up some of the rising talent.

      • Colonial Viper 2.1.1

        Too complicated, an 89% income tax on personal earnings over $500K pa will do just fine.

        No idgit is worth more than $2000 pay per day anyways.

      • Ennui in Requiem 2.1.2

        No, its more fundamental: we give teeth to legislation and regulation of monopoly / duopoly / cartel behavoir etc, take the money out of it. We also re nationalise all power, telco, etc and further put in place a public service pay scale with a maximum pegged as a multiple of the bottom wage.

  3. Stan 3

    If you seriously think that will ever happen I respectfully suggest you are in laa laa land.

    • Colonial Viper 3.1

      If you seriously think that will ever happen (Senior Executives giving up a fraction of their own pay to create new jobs) I respectfully suggest you are in laa laa land.

      You might be right.

      • One Tāne Huna 3.1.1

        Nope, Stan’s comments reveal Stan’s ignorance and that’s about it.

        “Research indicates that firms will respond in a number of ways to minimum wage increases. The most common response is to reduce wage relativities across staff.”

        NZ Treasury Regulatory Impact Statement. 2009.

        • Colonial Viper 3.1.1.1

          NB executive management in these corporates are not considered staff.

          • Rob 3.1.1.1.1

            What about stay at home relatives that contribute nothing to society, and spend all day commenting on blogs, what should they contribute?

  4. TightyRighty 4

    I’d rather take that 50% and have 100% more CEO’s. that would mean thousands of extra jobs for the unemployed.

  5. TheContrarian 5

    Without commenting on the $18.40 figure one thing I can say is that $13.50 is ridiculously low.

    • NickS 5.1

      Yeap, when looking for work on student job search I’ll usually pass over any jobs with that rate unless it’s offering really good work conditions or I’m super broke as usually another, better paying job will pop up.

  6. tsmithfield 6

    Problems with the “living wage”.

    1. It will be highly inflationary. Not only will companies have to pass on the cost of the “living wage”, but other more-skilled staff members currently being paid at that level will demand an increase in their wage to maintain the differential. These costs will be passed on to consumers, many who will be on the “living wage”. So, the “living wage” will unlikely keep up with cost of living increases, so probably won’t be an actual living wage no matter what level it is set at.

    2. Exporters won’t be able to pass on the costs as they can only get the market rate in the given export country. So, it will be bad for exporters.

    • Lightly 6.1

      it wouldn’t be inflationary – it would be a redistribution of income. And if its adoption creates a one-off increase in inflation it’s spread across all consumers, whereas the benefits of the living wage are concentrated on those who need it. In other words, it does its jobs.

      Exporters’ labour costs are a small portion of their costs. Most low paid workers don’t work in the tradable sector. Even in a worst case scenario, the increase in costs to exporters would be a couple of percent – miniscule compared to the costs of the rising exchange rate.

      • tsmithfield 6.1.1

        I fail to see how you can claim it is a redistribution of wages unless you are saying that the tax-payer will top up the wages (which is effectively what happens now under WFF). And the fact that workers will seek to maintain pay differentials means that increases won’t be limited to those on the “living wage”. Also the velocity of money through various stages of the production cycle means that the effect won’t be one-off. So, it will be inflationary.

        Also, if the wage costs are set at a higher level than what employers think is the actual value, then employers will look to find ways to reduce the number of employees at that level, through automation, system improvements, etc.

        Finally, there will be less incentive for employers to take on new employees, so unemployment will rise.

        • Colonial Viper 6.1.1.1

          What are you so afraid of?

          When and if inflation begins to bite down the track, we’ll just take money out of the economy.

          Also, if the wage costs are set at a higher level than what employers think is the actual value, then employers will look to find ways to reduce the number of employees at that level, through automation, system improvements, etc.

          This is beneficial. NZ enterprises investing in higher technology for their factories and businesses.

          This will let employees move to higher skilled jobs.

          Finally, there will be less incentive for employers to take on new employees, so unemployment will rise.

          Now you’re being ridiculous. Aggregate spending and demand in the economy is going to climb, employers will need a lot more staff to keep up, or risk losing business to competitors.

          You really ain’t very good at this mate.

          • tsmithfield 6.1.1.1.1

            “When and if inflation begins to bite down the track, we’ll just take money out of the economy.”

            Taking money out of the economy will increase unemployment. Probably at the expense of those on a “living wage”.

            “This is beneficial. NZ enterprises investing in higher technology for their factories and businesses.

            This will let employees move to higher skilled jobs.”

            Why would they bother training for higher skilled jobs if they can’t get higher than the “living wage” which will be an effective ceiling for many.

            “Now you’re being ridiculous. Aggregate spending and demand in the economy is going to climb, employers will need a lot more staff to keep up, or risk losing business to competitors.”

            Remember, aggregate spending and demand increase is highly inflationary, reducing the spending power of the “living wage”. So, you are in affect agreeing with me. By your own argument, the resulting inflation will prompt the RB to withdraw funds from the economy, hurting those on the “living wage” when they lose their jobs as a result.

            Your turn.

            • Colonial Viper 6.1.1.1.1.1

              Nah you’re full of shit.

              IF and WHEN inflationary pressures become excessive, the Govt has many choices to pull inflation and money out of the economy.

              Currently however the NZ economy has a huge amount of productive under-utilisation and that will keep inflation low for a long time.

              • Rogue Trooper

                as i commented the ova’ day, i don’t believe that this living wage is gonna fly; Corporate response-
                “if min wage goes up, we’ll have to source cheaper options” (I’m thinking, that recycle robot left cleaning up the planet…)

                • Colonial Viper

                  Economic blackmail.

                  Usual capitalist/bankster tactic.

                  BTW the State can always return the favour.

              • tsmithfield

                “IF and WHEN inflationary pressures become excessive, the Govt has many choices to pull inflation and money out of the economy.”

                And one of those ways is to tolerate an increase in the rate of unemployment. For other methods the government has at its disposal, the effect is to increase unemployment. So it seems to me that you are unwittingly advocating an increase in unemployment.

                “Currently however the NZ economy has a huge amount of productive under-utilisation and that will keep inflation low for a long time.”

                “Productive under-utilisation” is effectively the current unemployment rate. As shown above, a “living wage” will increase not reduce “productive under-utilisation”.

                • Colonial Viper

                  More bullshit baffles brains from TS.

                  Read up on your NZ history. NZ had decades after 1940 with near zero unemployment, manageable inflation and workers able to buy a house and support a young family on just one income.

    • Colonial Viper 6.2

      it won’t be inflationary – not while there is plenty of spare productive and competitive capacity in our economy. Consumers will continue to shop for good deals and will reward suppliers who can deliver on them.

      Trust the market tsmithfield.

      2. Exporters won’t be able to pass on the costs as they can only get the market rate in the given export country. So, it will be bad for exporters.

      What a weird thing to say. With a lower NZ dollar, exporters will get more NZD per unit sold overseas. More NZD garnered means more profits.

      • tsmithfield 6.2.1

        Except, if the “living wage” is inflationary, then the dollar will go up, as the RB will need to lift interest rates. So, exporters will be worse off, not better.

        • Colonial Viper 6.2.1.1

          Its easy to depress the NZD ts.

          • tsmithfield 6.2.1.1.1

            Yeah. Just vote a left government in. The NZD will quickly “adjust” to that change of circumstances.

            • Colonial Viper 6.2.1.1.1.1

              LOL that’s exactly what John Key reckoned the Goldman Sachs bankster said about a Labour win

              • McFlock

                but but but Labour will increase the minimum wage, which apparently will increase inflation and cause OCR adjustments that’ll raise our exchange rate! So under labour our dollar will simultaneously increase and decrease in value?

                • Colonial Viper

                  Yeah that’s about where we get to with these privilege protecting Righties. But hey, free market neolib economics has worked so well for NZ and for Europe and the USA, what can possibly go wrong with more of the same medicine.

                • tsmithfield

                  Nothing contradictory there at all.

                  The first instance describes the effect all things being equal.

                  The second instance describes the effect if a left leaning government ever actually gets a chance to impliment a whole suite of loony policies (e.g. money printing etc).

                  • McFlock

                    lol

                    So basically, if a left wing government entered power and implemented measures like minimum wage, printing money, increasing benefits to a dignified level, and greater access to healthcare and education, then:
                    the dollar would decrease,
                    exports increase,
                    more people would be paid more (and fewer paid gazillions) so inequality would decrease,
                    more people would be employed actually making shit for the export market,
                    and more taxpayer money would be spent on healthcare and education.

                    Sounds like hell. I can see why tories want to avoid it…

                    • tsmithfield

                      There is a difference in the effect of a decrease in the value of the dollar that makes exporters more competitive compared to the dollar crashing in an uncontrolled way, with all sorts of negative consequences.

                    • McFlock

                      Indeed. Things might get as bad as 7% official unemployment.

                  • Pascal's bookie

                    The second instance describes the effect if a left leaning government ever actually gets a chance to impliment a whole suite of loony policies (e.g. money printing etc).

                    Imma gonna let you finish but have to step in right here and ask if you voted for Don Brash? When John “let’s be more like Ireland” Key was in the finance role.

                    How very dare you Ts.

                    Fuckin shameless is what it is.

          • King Kong 6.2.1.1.2

            Yes, by making it read some of the economic buffoonery on here. Very depressing.

            • McFlock 6.2.1.1.2.1

              You do realise that the pictures on notes and coins are merely artistic representation of real people, not real people in themselves, right?

              While we’re at it, your TV is not full of very tiny (but incredibly horny and violent) gnomes.

  7. AmaKiwi 7

    Back in the olden days when Playboy was often illegal, a judge said, “I cannot define pornography, but I know it when I see it.”

    I cannot define immoral inequality, but I know it when I see it. I see it now.

    Why was there a revolution in France? Because by 1789 one third of the people of Paris were homeless.

    “But that can’t happen now. Yeah right.”

    A lot of tonight’s comments have been a pissing contest between those who thought Playboy was pornographic and those who didn’t. Keep pissing but no one is likely to change their mind based on the arguments above. My hope is that when the revolution overthrows neo-liberalism we won’t have a reign of terror.

  8. jim 8

    Surly it is immoral for a worker to earn a minimum wage, that does not support a worker or their family enjoying what others take for granted as normal, family days out, sport participation, going to the movies and the like,let alone earning enough to service the Kiwi dream a mortgage.

    My lad and two of his friends, applied for work in the South Island through W.I.N.Z. they were given assistance by W.I.N.Z for travel costs and assured that they would be going to a job that would employ them 40 hours minimum, when asking about the pay rate W.I.N.Z.assured them it would at least be set at the minimum wage.When they arrived at this Vineyard the contractor who was employing them said that he had accommodation for them at his farm, at the cost of $135 per week, that entailed a bed and a lift to and from the place of work,supply your own tucker.When asking him what the hourly rate was “we work productivity the more you do the more you get”,the job entailed what is known as vine rubbing at the magnanimous pay rate of 4 cents per plant.The boys said it was back breaking hard yaka and after paying the rent they and others had little left for tucker.

    This is the sort of exploitative employment that has been running rampant for the better part of ten or more years in N.Z.not only by wine exporters and their contracting agents, but also by many producers of food products who are making healthy profits yet plead poverty when asked to pay a affordable living wage.

    • Rogue Trooper 8.1

      Yep

      • jim 8.1.1

        They got back and held their breath that the minimum stand down period for applying for a benefit would not be extended, due to them not getting the sack,three months minimum stand down for not getting sacked.W.I.N.Z. eh!.

    • @Jim
      Your comment is are really good illustrative example of what I hear a lot of too.
      There is perhaps two types of employers in NZ (minus the corporations).
      ~Type one: who really are achieving a small profit and wouldn’t be able to afford a minimum pay increase.
      ~Type two: the type you describe.

      I was just having a discussion with someone the other day, how there appears to be a culture of begrudging employees wages; that the expense of wages are simply not considered a necessary cost of the business. (I.e. less vitriol about the cost of food, plants, fertilizer- the physical, non-human components to the business). There is no real acceptance of either the real value that the worker provides (no workers, no business; the workers are the business), nor that the worker requires to be able to feed, clothe and house themselves with hopefully a little over those costs to save for a rainy day.

      Sadly, I have seen these attitudes openly displayed by those who are paying the absolute minimum wage to boot. Very ungenerous attitudes all round.

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