- The Guardian discusses how the all-too-familiar trend of growing inequality and ever more precarious lives for all but the fabulously wealthy is unsustainable:
While the debate in the UK is mostly focused on growth and how best to engender it, Reich explains in chilling detail why growth alone may not be enough. For too many, he explains, social mobility has begun to slide backwards. A small but growing band of global pirates – billionaires all, without allegiance to community or country, devoid of civic responsibility – accrue wealth from the continued immiseration of the squeezed majority. These hugely rich are fawned over and subsidised by governments even as inequality widens to a chasm that may yet produce social unrest.- And speaking of the immorality of markets, Ben Goldacre discusses how big pharma uses selective reporting of test results to get new drugs approved and prescribed - whether or not they actually serve any purpose other than profit extraction.
Reich's analysis is similar to that of the UK thinktank, the Resolution Foundation. It launches its definitive study of low- to middle-income families, Squeezed Britain, this week. Britain has more than 10 million adults living on between £12,000 and £30,000 gross, the majority in work. However, this squeezed middle is fast becoming the squeezed majority, with even those on £50,000 seeing their children's prospects decline. The cause, Reich points out, is that while wages have flattened for years, the cost of living has spiralled and the richest have accelerated away. In the US, in 2008, 400 billionaires were "worth" more than 150 million of the US population. British housing statistics published last week indicated a similar contemptible polarisation under way here. The 10 most expensive boroughs in London, packed with Russian oligarchs, have a combined property "value" of £552bn, identical to that of Wales, Scotland and Northern Ireland combined.
Over the past few decades, average families have coped by more women going into employment, by working longer hours and by credit. But since 70% of the US economy is based on consumer spending, a lack of surplus cash means the engine is running out of fuel. The rich are small in number and don't spend nearly as much as the majority. "Free" markets with the rules written by the richest result in a shrinking public sector, deregulation, unemployment, low taxes for the most affluent and the threat of globalisation, depressing wages still further. The sum impact isn't "bad" capitalism, it is modern-day capitalism. How it changes, and how rapidly, is a challenge to its own survival. Once, the advancement of the employee was a part of the social contract. Under Thatcher, the aspiration of the average citizen was central via shareholding and home ownership. Now, a more brutal set of priorities pushes the requirements of "the little man" aside, while those who have money buy the influence that unjustly shapes the world in which we live. So how do we forge again the link between morality and the markets?
- Meanwhile, James Bell reports on how a concerted attack on the beneficiaries of social programs - as we're currently seeing from the Cons - serves to distract from the much larger amounts lost to tax evasion. And Trish Hennessy suggests that we should use stronger wording than "tax havens" to describe those who facilitate tax evasion.
- Finally, Murray Mandryk discusses Herb Emery's economic advice for the Wall government:
Emery's report is a great reminder to Wall - and the rest of us, for that matter - that maybe we don't need to rush into arbitrary spending decisions and that delays may not be the worst thing in world. Similarly, Emery raises some good points that dashing out to hire Irish workers or temporary labour - especially unskilled labour - seems wrong. Perhaps getting people from Ontario is better, Emery suggested. Maybe more money for skills training of First Nations people - instead of pouring more into university educations that benefit more mobile workers - is smarter government expenditure.
And if Saskatchewan people are unwilling to work at Tim Horton's for wages offered, they are likely telling us wages are too low.
Emery offers some wisdom that perhaps Wall should pass along a wake-up call to favoured groups like the Canadian Federation of Independent Business, which constantly opposes minimum-wage increases. As Emery explains, if you can't pay workers a fair wage, maybe you're selling your coffee too cheaply. Bringing in unskilled workers from Mexico to pour coffee hardly seems a viable solution for anyone.