Mili's spin on the immigration debate is instructive: the 'root cause' of unhappiness is that immigrants are being paid so little - nay, being exploited ! The solution, as always, is to invent a new criminal offence:
“This new criminal offence will provide protection to everyone. It will help ensure that when immigrants work here they do not face exploitation themselves and rogue employers are stopped from undercutting the terms and conditions of everyone else.”
Somhow I doubt this analysis and cure will defuse the 'not very well-drafted immigration / UKIP strategy document' row. But when the dust is cleared, let me offer some observations on Ed's plan. As regular readers will know I have good ongoing links into the civic affairs of the borough where once I was a councillor for many years, with plenty of accurate data from the front line. Said borough is ultra-diverse with no one ethnic group really predominating, but there is one particular area (containing - no coincidence - the block that was razed to the ground during the riots in '11) that is solidly Tamil: quite well-organised and very hard-working.
And Mili will wish to be apprised that the going rate for jobs there is £2.00 per hour: everybody knows the score. A tad lower than the Minimum Wage, I believe, but there we are. Muster your raiding party, Ed, and lock 'em all up.
No? Thought not.
ND
Caught the James O'Brien show on LBC, on Monday morning.
Mr O'Brien, who is the voice of the left at LBC, was overjoyed that Labour had pledged a minimum wage of £8. Really, really happy. It's something I've heard him argue for a few times. Pay people more.
He put forward this hypothesis. If your business could not stand a measly wage rise for its employers to £8 from the current £6.50 then your business is a zombie business and should go bankrupt. There is no point hanging on trying to make a go of it. Just close up. Shut the doors..Call in the administrator.
Now, the actual Labour party announcement is £8 over the course of a parliament. So its probably only an inflation + rise anyway. £1.50 over 5 years. A real non-annoncement if ever there was one. A miliband special.
It was £5.80 in 2009. So has risen by 70p/hour during the great recession. It will do better than that in a more profitable climate.
And it wasn't clear if Labour also want to include the £8/ph for 16+17 years olds too. That would be about a 100% payrise for them.
So, i have no real problem with a £1.50 rise over 5 years. Except if we were in a recession in 5 years time for any number of reasons from ISIS to Putin to EU vacuum cleaner motor type regulations running amok, it would be pretty stupid to put up wages.
However, what is a problem, is Mr O'Brien's complete disconnect from reality. He was genuinely, genuinely saying, it is better to close a business than to let people be paid below £8 per hour.
He seemed to believe that a wage rise would not affect business. He quoted his favourite enemies of banks and supermarkets and multi-nationals, making millions in profits, whilst their lowly cleaners struggle on £6.50 an hour.
SUCK IT UP capitalists! You CAN afford it! And if you can't ..tough..
Mr O'Brien is normally a well reasoned broadcaster. Thoughtful. Witty.Clever. A keen mind that is skilled at analysing what his callers are suggesting and quickly seeking out the flaws or surprises of what they propose. All while keeping the program flowing and the news and traffic on time.
He is a good radio host.
But
In this instance, he's a lefty mental. He is someone unwilling to fully examine exactly what he himself proposes. Something he would never let a caller get away with. He was seriously talking of an £8 wage - tomorrow!
For instance, the NHS. Under these proposals, the budget for the NHS has just risen by some 19%-25% The number of workers, directly employed some 1.8 million, { indirectly, 4 million? }. The wages of EVERYONE must rise under minimum wage. Its no use paying a cleaner the same as a cleaning supervisor..all must have an increase.
Taxes must rise. That £1.50 is going to be gone with a 27% minimum rate of tax again.
Every council in the land has just had a whack. So council taxes must rise
Airlines and airports with their £99 a ticket deals must take a 20% hit on the nose.
A hairdresser operates on a physical employed basis. An owner can only cut so much hair themselves. So they have to employ. Can they put up the price of a haircut by 20% to meet the increase in wages?
if they do, and the one over the road doesn't, how will they manage?
Mr O'Brien says the owner should just earn less money. And if her business is not already making enough to meet the rise, she should close up.
he cares not for the owner taking all the risks. The employes, whose investment in the business is usually nil, is worth more and must come first
A corner shop makes some 10% profit from cigarettes. About 4% from national lottery. 12-25% from magazines, fresh food, chilled goods etc. There is no margin to raise.
Its a very, very competitive business with the big boys having the upper hand. Mr JamesOB is handing the largest corporations, in every sector the entire playing field. His support, his actual demand that the smallest must quit, leaves only the biggest players. The very companies that he continually attacks, for their dodgy corporation tax funneling through low tax havens. Their zero hour contracts. Their squeezing of suppliers. Their destruction of the high street...
He's proposing that only the megacorps will be left.
The man is creating his own Skynet.
On top of that the inflation effects of a 20% payrise for all tomorrow have been documented well enough in this country in the 70s and 80s. The effect on employment would be catastrophic. A wage hike tomorrow means limited hiring for 2-5 years except at the most profitable companies. It probably also means redundancies. Certainly it means less hours. The businesses that pay minimum wage are in the low skilled, high employee count sectors. An £8 min wage does nothing to the more skilled sectors, who must be paying over that now for the majority of their people already. It hits the low skilled/unskilled. The very people that James feels deserve help the most.
Labour are also promising a job guarantee for every young person. That job wil be on this same national minimum wage.
How exactly are they to do that if the smallest of small businesses are closing? And not just the smallest. DairyCrest are announcing cuts to its workforce as it announces it will close bottling plants.
I wonder if the workers there were asked if they wanted a pay freeze or a job, what they would say?
Mr O'Brien does not believe they should be asked . Just close the business down and let the workforce take up the much better paid jobs that will be on offer elsewhere.
Quite where these jobs will be, he doesn't say. Maybe a massive increase in artisan bakeries and bespoke furniture covering stores. Designer curtains shops and specialty food emporiums. Those who can charge £7 for a loaf or £6000 for a coffee table can afford to pay any hourly rate the government requires.
For the real high street outside of Chiswick, where budgets are not the same as in West London media sector joint incomes, there is always Wonga, Ladbrokes, Poundland, The Heart Foundation, Brighthouse and the tattoo parlour to work in.
Oh, By the way Mr - Ed Balls,Mr James O'Brien. It is the low paid commission that sets minimum wage and NOT the government. If you aren't going to listen to them, then abolish them.
And add those jobs to that ever growing dole queue.
