Sunday, 30 August 2015

Immigration aids Growth Fallacy

It is amazing that even seasoned Commentators fall for this fallacy. Economic growth has been relatively 'robust' in the UK in the past year (if you want to call growth in the low single digits that way). But to claim that this is partially due to an 'open door' immigration policy is disingenuous to say the least. Fact is that any economy will grow faster if the number of active workers increases. So the all-important measure of growth PER CAPITA is not growing by a similar amount. Sad thing is that the influential lobbies representing employers get too much of a hearing when they complain of labour 'shortages'. It is disgraceful that the overpaid bosses in large listed companies and these owned by 'Private' Equity - who dominate the discussion with easy access to gullible politicians and media - do so little to raise skill levels in order to achieve more output with a given pool of labour, i.e. by improving productivity. They prefer the easy route of importing cheap labour from countries that are at a completely different stage of economic development. But they care little about wage dumping as long as they live securely in their gated mansions or offshore tax havens.

Saturday, 22 August 2015

Working in a Neo-Feudal Corpocracy

Reports about the Work 'Culture' at Amazon puts the spotlight on one aspect that the current version of a Free Market Economy (dubbed 'Capitalism') seems to carry to its logical conclusion: in a world devoid of any moral yardstick the ego of the few controlling the profit maximising at all cost company people are just disposable inputs.
This form of Capitalism has worked surprisingly well for a long time (but so has slavery and feudalism) as the people at the helm (owners or their agents) had some sense of noblesse oblige and were also restrained by some inner moral or societal compass.
Capitalism will always have an image problem as its success seems to be reliant on a Darwinian model of markets: One side wins when the other side loses, i.e. if you want ever-rising profits you have to squeeze the people working for you. But the invisible hand does not work as Adam Smith thought. His model of the economy might work for the neighbourhood bakery. It assumes perfect competition and free entry to the market. When you and your employer clash you just walk down the street and open your own bakery.
And while this model works to some degree - nearly all businesses have competition - it only works to a degree.
As long as the 'Capitalist', the owner of a firm, calls the shots when dealing with an atomised workforce there will not be a proper balance in the business world. In the case of Amazon only a united representation of the workforce will be able to deal with actual or perceived abuses.