A Fascinating Article on Britain in Decline

[Sukerkin]

This is a blog from the BBC. It is well worth a read and the comments after it are even more illuminating and thought provoking:


http://www.bbc.co.uk/blogs/newsnight/paulmason/2010/03/whats_wrong_with_britain_part.html


This post is one that touches on one of the primary problems viz the destruction of what was achieved in terms of social welfare in this country by a failure to channel the globalisation process towards the benefit of people rather than the maximisation of profit:



Britain has become a low wage economy. #66, MikeHSurrey, it's not just manual labourers that are being priced out of the market by overseas companies and foreigners, nearly all of whom are legitimately here, being prepared to work for the minimum wage - or less if they can get away with it. So are skilled workers being priced out of the market. If you're an accountant or a lwayer, then you may be able to rely on needing local knowledge to keep your salary propped up. But "C++ programmers, electronic hardware designers, system-on-chip embedded system designers"? All of these people can be bought overseas much cheaper than they can be sourced in the UK.They don't even need to be here to do the work.

The minimum wage in Britain is a joke. If you have children, then a minimum wage job will qualify you for housing benefit, council tax benefit, not to mention working tax credit. What kind of a system is it when the minimum wage is set so low it qualifies you for benefits? Surely the whole point of working - at any job - is to be able to earn enough to not qualify for benefits?

There are EU workers up here, working on Scottish building sites, for the minimum wage. Qualified people, like chippies, bricklayers etc. And the contractors are hiring them. They know the system, claiming all the benefits they are entitled to and quite a few of them have social housing. To my mind the bosses who hire them are traitors to their own. But as one said to me recently - "it's not just about the money, though that's a big part of it. They have a different (better) attitude to the locals" Sure they do - they've just got a 100% pay rise from what they would have got in Europe, plus benefits to boot, while the locals who used to be on £15 to £20 an hour are now expected to work for £5+ an hour, and on some sites they don't even get a look in.

We met a girl the other day, waitressing, from somewhere in Eastern Europe.. In a coffee shop. She showed us the £3 another table had just tipped her. She said in her country she didn't even get that much for one day, a ten hour shift. Here she gets it in one tip. Says it all really, doesn't it. To her, she's working for a small fortune. For us, with private rents to pay because we can't get on the social hoising list, a waitress job would barely pay our rent, let alone the rest of our expenses.

 

[Ken Morgan]

Sadly its similar here in Canada to...we exported all of our livable wage jobs overseas, and are stuck with the low page ones.

 

[Empty Hands]

The interesting thing about globalisation and free trade is that the low wage countries that many of the jobs are being sourced to (China, India) are fiercely protectionist of their own economies and industries. They are laughing at us. So are the transnationals.

At the very least, it would be nice if these companies making a killing on labor costs at least paid their taxes. Alas, tax haven countries exist for a reason, and the bought off governments here and there go along with it.

For all the huge problems industry and business had 60 years ago, at least most of them felt some sense of obligation. The understanding was, if you put in good work for your 30 years, you would have a job. One wage earner could feed a family and buy a house. All that is gone. Real wage growth has been flat for 30 years. And all of that happened for specific reasons - and the poor conservatives have been convinced it is in their interest.

 

[Sukerkin]

Another good post from the blog (by 'good' obviously I mean one which contains views I agree with (both personally and as an ex-economist) ):

Quite honestly Paul, we need to become a bit more self critical rather than running hither and yon about the world telling others how they should do it when we can't even do it ourselves. The great British failing is hypocrisy; we do it rather well but we do it to each other first.

Might I suggest we progressively dump globalism. I propose that we do this through the European Commission and at the expense of other trading blocs. I could be accused of creating a Fortress Europe but we need to define where and how our welfare is to be sustained.

There is nothing wrong with free trade between nations but when we are in a situation where low wages in one or two very large countries are undermining our entire industrial base, our whole economy and our society we need to ask ourselves whether we can allow such a policy to continue?

This will allow us to redefine what we are good at in this country other than cooking up financial bubbles. Obviously such a policy would be condemned by the established elites but surely some nine million economically inactive people tells us there is a problem here and now that needs attention.

By seeking to reduce our global economic exposure we can use tariff barriers to repatriate our manufacturing industries, promote local manufacture, local supply chains, reduce carbon outputs, enhance agricultural output, increase employment and induce social and economic recovery. We can do all this within the context of the European Union which is a large free trade area anyway.

I agree that this reversal into older policies has its risks but what are the risks if we try and go on as we are? We need to reduce the public deficit, reduce the public debt, bring the banking industry to heel through reform so that it serves the needs of the taxpayer who has been conscripted into underwriting its risks, restructure our economy so that it serves all the people in the country, create a lot of productive, value adding jobs promptly and reverse the crumbling social structure.

Are we able to do this within a globalised economy as currently arranged? I fear not.

I would like to be disabused of this idea developing in my aged, shrinking brain.

 

[Ken Morgan]

Here's a good article, though its about the US, you could add the UK or Canada into the mix too.

http://www.humanevents.com/article.php?id=36002

 

[Ramirez]

Sadly its similar here in Canada to...we exported all of our livable wage jobs overseas, and are stuck with the low page ones.

And concentrated wealth in the financial sector instead of the industrial sector. Britain has something ridiculous like 25% of its workforce in the financial sector.

We all bought into supply side economics in the 80s and 30 years later all that has happened is that middle class buying power is stagnant, perhaps even declined and wealth has been concentrated into a microscopic percentage of society.

No wonder they call it trickle down economics, everyone gets urinated on from the top.

 

[Sukerkin]

:lol: Love that turn of phrase, Ramirez. True and vibrant imagery there.

Just like to point out that I never bought into Monetarism - I always called it "Piggy Bank economics" due to the child-like idiocy of it's assumptions. I could never quite believe that those that ran our countries did think it had a prayer of being anything other than an unmitigated disaster ... oh look! It was .

 

[Steve]

Here's a good article, though its about the US, you could add the UK or Canada into the mix too.

http://www.humanevents.com/article.php?id=36002

I considered it a sign of the times when Pat Buchanan, who used to be about as extreme a right wing voice around as one could find, is now a rational, sensible voice among the conservative movement.

 

[Andy Moynihan]

Oh It ain't just Britain in decline, trust me.

 

[Tez3]

Things like this used to get my mother mad, people saying how bad things were now would make her shake her head almost in despair. things, she said , now were better in this country and many others than they have ever been. You had to have lived through the twenties, thirties and forties to appreciate how much better things were now. She would also get mad when people also said how much better things were 'in the old days', when there was supposedly no crime, divorce,everyone had respect for everyone else etc etc, did they hell!
She had a point you know.

 

[Bruno@MT]

My grandmother used to say that there was nothing particularly good about the olden days. She lived through 2 world wars and a depression. There used to be at least 1 funeral per week for a kid that died of trivial thing like pneumonia or staph infection. Workers rights did not exist, and worker / environmental safety were irrelevant. What we have today are luxury problems.

 

[Sukerkin]

That is true, Bruno but I think the core point is that we must judge things by their context. Things were looking up for the common man for a while, after quite a few million of our predecessors gave their lives in wars.

Now they are in terminal decline because the Financial big boys have been permitted to run amuck. Export of jobs sounds clean enough but what it actually means is that workers elsewhere are being exploited just as our forerunners were (before they Unionised and fought back). Profit is being squeezed from them because they are not organised and the effects of that reflect back to those of us 'fortunate' enough to have been born in First World countries.

It is not a moral state of affairs and neither is it of utility to the vast majority of the population (whereever they dwell).

 

[Ramirez]

My grandmother used to say that there was nothing particularly good about the olden days. She lived through 2 world wars and a depression. There used to be at least 1 funeral per week for a kid that died of trivial thing like pneumonia or staph infection. Workers rights did not exist, and worker / environmental safety were irrelevant. What we have today are luxury problems.

Now the old days refer back to the 50s through 70s , at least in North America, an expanding middle class, a solid economy and a sound not dominating financial sector.

My fear is the supposed good times we are in has been financed by debt, the deregulation of the financial sector has made it far too powerful and the economy is still dependent on the middle class all the while as middle class standard of living has declined.

The economy has been run on the middle class going into debt to try and maintain a standard of living...now the bill is due.

These so called good new days might be what leads us into the bad old days.

 

[Sukerkin]

Another insightful post to a BBC blog related to this issue. I don't remember writing it but it sounds an awful lot like me when I bang on about "Property Developers" :lol: :

--------------------------------------------------------

The UK economy is so unbalanced now that major changes in taxation have to be brought in in order to re-balance it.

The London-centric economy based around finance, public sector broadcasting and politicians, aided by some very lucrative paying posts in the public sector such as GPs, Surgeons, Council Chief Executives and Council Heads of Department, etc, has so unbalanced the economy in terms of housing and house prices that we have a two-tier economy in many parts of Britain.

It is thus very hard for people in the regions to take risk when they realise that they are now priced out of houses and pensions, often unable to afford either, whilst working and shopping alongside those who salaries and bonuses have been so extreme in the past 10 years that they have, quite simply, driven up house prices beyond the reach of most on average wages.

I know of numerous GPs and Surgeons who now have extensive property portfolios simply because they had plenty of money to spare as their salaries soared in the past decade - resulting in Doctors competing against each other to buy second, third and more homes or to get into BTL empire-building. Tiny run-down grotty 2-up 2-down terraces from Swansea to St. Davids which you could not give away 10 years ago now change hands for 200K, 300k and more.

An estate agent recently told me of a 2-up 2-down terrace with no parking that was put on the market for 375K in West Wales which, when it last sold, went for 60K - the view was that there was "no shortage of bankers with millions from London just wishing to buy property".

And then you have the BTL types from London who have bought up properties near Universities in Wales, some of whom would not look out of place in a Dickensian novel, who pay no Council Tax on a single student BTL property and who, as absentee landlords, seemingly care little or nothing for the suburbs and lives of the local people whose lives are blighted by their homes becoming part of student ghettoes.

The last thing that this country needs now is more Londoners, be they bankers or meeja types or green eco-trendies, telling the rest of us how to live our lives and/or what is needed to sort out the country. Until this imbalance in house prices, and who can afford and who can't afford houses in the regions, then we will continue to have an increasingly polarised Society - a Society that more and more no longer feel a part of.

So, we to move away from an economy based on house prices - second, third and more homes needs to be punitively taxed in terms of Council taxes and sales tax. If you have a second or third home somewhere in the UK then you need not just to pay the same Council Tax as the locals - they currently pay a fraction of the Council Tax that local residents pay if they pay anything at all - but the second and third home owners needs to pay 2 or 3 times the local Council Tax.

BTL landlords must be forced to pay Council Tax on each of their properties whether they have students in them or not and a limit put on the number of BTL properties in any suburb. Likewise, there needs to a punitive tax on the sale of any BTL property.

MPs, for so long milking the housing bubble and their mortgages paid by us on their second homes, have obviously been oblivious to the real pain felt across the UK by the housing bubble and the rise of the second home owner from London and the BTL empire builders. There is real anger in the regions about this and, just as importantly, the UK needs to move away from the economics of an economy seemingly governed by estate agents and go back to generating real wealth!

(Of course, the BBC does not report such things as the BBC appears to be now a major player in 'property porn' TV and the ramping of house prices and urging us all on to make our fortunes from buy-to-let empires.)