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More Slave Labour

Entry 1474, on 2012-12-07 at 21:27:14 (Rating 4, Politics)

I was amused to see opposition leader David Shearer ridiculing the prime minister by using Westpac Stadium to mark the 50,000th New Zealander to leave for Australia this year. Of course during the 2008 election campaign the PM used a similar stunt to highlight the loss of people when Labour was in government. But now, despite his promises, things are even worse. It's just another epic fail under National, I guess. No surprises there.

The PM thought that it was inevitable that Australia would be an attractive destination because of the high wages paid there. And said: "So yep, we have got to do better in that regard, but I don't think you are going to stop people going when there are such huge amounts of wages being paid."

So he has identified higher wages in Australia being a major reason for people leaving. What is his party's answer? Is it to try to increase wages here? No, apparently a better approach is to decrease them by extending the "slave labour" policy for young people who can currently be employed for $10.80 per hour - well less than the minimum wage.

Of course the greedies love this. The chief executive of the Retailers Association claimed the policy is not discriminatory because there tended to be a direct relationship between age and experience, and that he hoped people with longer work experience would be more productive, and that employment decisions were probably based on productivity.

Notice the weasel words in what he said? There "tended to be" a relationship, and he "hoped" experience would lead to productivity, and that employment decisions were "probably" based on productivity. The reality seems to be that he doesn't know anything and he just made it all up! All he does know is that cheaper wages are good for the rich. Their agenda is to drive wages and conditions down as part of the right wing's race to the bottom (for everyone except themselves).

A representative from the Combined Trade Unions gave another perspective. He said that a survey of employers showed very little incentive to employ more people just because they could be paid less. I don't know the details of this survey but at least it's real data as opposed to something just dreamed up by someone from the employers' side.

I can see that there might be a few situations where paying someone a pitiful $10.80 an hour instead of a horrendous $13.50 per hour might encourage an employer to hire that person but it seems unlikely and the survey results reinforce this idea. But even if it did result in significantly more employment is it worth the cost?

Pushing wages down in one section of society will always have repercussions somewhere else. Hiring a young person at the lower rate might mean that a more mature person might not be hired as a result. Or maybe it will mean that person might have to accept a lower rate of pay. And that's how we race to the bottom.

At this point you might ask what other solutions I could offer. Well as it happens getting greater employment is very easy but it goes against the currently accepted dogma. Luckily Labour is finally distancing itself from the failed free market policies of the past and is prepared to actually do something about our problems instead of relying on those magical market forces.

If you want to have more young people employed give them the same minimum wage as everyone else but subsidise the employer. Effectively the reduced pay rate is already a subsidy so why not make sure the employee at least gets the benefit of it?

But that's not really the right approach. We need more jobs in new areas, and we need to reduce job losses in existing areas, not try to create low wage jobs which aren't really needed. We need a stimulus approach rather than an austerity one. We need to build more cheap houses and heavily tax people who are exploiting the current conditions by buying property for a quick profit.

We need to direct state owned enterprises to use New Zealand companies unless there is a really good reason why not. If we just continue to buy cheap, poor quality goods and services from economies like China then we will have to become more like China to compete. Doesn't that also sound like a race to the bottom?

There is a chance that we can return to common sense ideas like these instead of the ideologically driven policies we have now. But that won't happen until the next election. The right wing politicians currently in charge will do a lot of damage before then. If past experience is anything to go on, as they get closer to realising that they will lose the next election they will be increasingly enthusiastic in doing as much damage as they can before they go. Of course they will just say it is all part of their economic master plan.

Well if your master plan involves creating an economy based on slave labour then sure, they're right. It's certainly working so far. I just hope that things change before we move too far down the road to that slave labour economy.

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