British employers exhibit on-going greed but lie about it

One of the abiding and recurring trends, accentuated in the neo-liberal era, is the apparent ‘concern’ for the low-paid by the captains of industry. They continually warn against allowing pay increases for this cohort because they are – so the story goes – deeply concerned about the damage it will do to the employment prospects. What they really mean is that they know pay rises at the bottom end of the pay structure don’t alter employment levels significantly but have some impact on profitability. That is, they reduce profits a little. And that is the concern they are really expressing. The British Chambers of Commerce have called for a freeze on real wages for the lowest paid workers in Britain despite profitability soaring and the share of business profits in national income rising. The expression ‘where do these characters get off’ comes to mind. Although it is hardly surprising. British entrepreneurs tend to be lazy and take the easy way out when they can to further their own ends.
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    Posted in Britain, Labour costs, UK Economy | 15 Comments

    The Weekend Quiz – July 15-16, 2017 – answers and discussion

    Here are the answers with discussion for this Weekend’s Quiz. The information provided should help you work out why you missed a question or three! If you haven’t already done the Quiz from yesterday then have a go at it before you read the answers. I hope this helps you develop an understanding of modern monetary theory (MMT) and its application to macroeconomic thinking. Comments as usual welcome, especially if I have made an error.
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      Posted in Saturday quiz | 4 Comments

      The Weekend Quiz – July 15-16, 2017

      Welcome to The Weekend Quiz. The quiz tests whether you have been paying attention or not to the blogs I post. See how you go with the following questions. Your results are only known to you and no records are retained.
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        The conservative opposition to full employment legislation in the US

        In 1946, with the Second World War at an end, the world governments turned to the question of how to maintain the full employment that the prosecution of the War had brought in the peace. It was clear that governments could choose whatever unemployment level they wanted through the manipulation of fiscal and industry policies and so the only question was the political will to maintain the full employment state. In the US, the political debate led to the Employment Act 1946, which demonstrated that the parameters of the conflict between conservative and the more liberal forces over what constituted full employment and what responsibility the currency-issuing government had for maintaining high levels of employment. We can see through successive attempts in the US to legislate for full employment how the economic profession has influenced the political process and how we have reached the point today where governments pay lip service to fulfulling their responsibilities as the fiscal agency to maintain sufficient jobs for those who desire to work.
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          Posted in Future of Work, US economy | 9 Comments

          Disturbing pay trends in Britain

          Earlier this month (July 3, 2017) the British Office of National Statistics (ONS) released a research report – Wage growth in Pay Review Body Occupations – which basically summarises what has gone wrong with the world under neo-liberalism. While the Report is about the UK, which has particular characteristics, the trends identified are almost universal and reflect the dominance of the ‘free-(not!)-market’ austerity mentality that has crippled progress around the world. It also helps us understand why the British economy is stalling again and why the latest data on household spending is so disturbing. These trends have nothing to do with Brexit. They are all down to misguided government policy (austerity) and erroneous strategies that seek to generate fiscal surpluses when the non-government sector needs to also run surpluses (and the two aspirations are not simultaneously achievable). British workers are paying for this incompetence. The economists who gratuitously hand out the spurious advice, unfortunately do not lose their jobs.
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            Posted in Britain, Labour costs, UK Economy | 11 Comments

            US labour market – improves in June but still no growth trend is apparent

            On July 7, 2017, the US Bureau of Labor Statistics (BLS) released their latest labour market data – Employment Situation Summary – June 2017 – which showed that total non-farm employment from the payroll survey rose by a relatively healthy 222,000 in June, after a much weaker result in May 2017. The Labour Force Survey data showed that employment rose by 245 thousand in June but was still not large enough an increase to offset the rise in the labour force, and as a consequence, official unemployment rose by 116 thousand. The official unemployment rate rose by 0.1 points to 4.4 per cent as a result. There are still 6.98 million unemployed persons in the US. The Federal Reserve Board’s Labour Market Conditions Index showed a slight deterioration in the overall labour market. There is still a large jobs deficit remaining and other indicators suggest the labour market is still below where it was prior to the crisis. Further, the bias towards low-pay and below-average pay jobs continues.
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              Posted in Labour Force, US economy | 3 Comments

              EU clones itself in West Africa and then tries to ransack the region

              In a recent blog – If Africa is rich – why is it so poor? – I considered the question of why the resources that make Africa rich have not been deployed to the benefit of the indigenous people who reside there. We saw that poverty is rife in Africa, when it is obvious to all and sundry that these nations possess massive resource wealth. The answer to that paradox is that the framework of development aid and oversight put in place by the richer nations and mediated through the likes of the IMF and the World Bank can be seen more as a giant vacuum cleaner designed to suck resource and financial wealth out of the poorer nations either through legal or illegal means, whichever generates the largest flows. So while Africa is wealthy, its interaction with the world monetary and trade systems, leaves millions of its citizens in extreme poverty – unable to even purchase sufficient nutrition to live. The ‘free trade agreement’ (EPA) between the EU and the West African nations is one such ‘vacuum’-like device. In fact, the West African states are still mired in post-colonial dependency not because they lack the resources available to set out their own development path, but, rather, because of the post-colonial institutions that have been set up to maintain control by the former colonialists of those resources. Not content to ruin the prosperity in the Eurozone, the EU is pressuring some of the poorest nations in the world to adopt the same sort of failed monetary and fiscal arrangements and then go further – and sign ‘free trade’ agreements with reciprocal access. The rest of the West African states should follow Nigeria’s example and abandon these arrangements.
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                Posted in Economics, Eurozone | 11 Comments

                The Weekend Quiz – July 8-9, 2017 – answers and discussion

                Here are the answers with discussion for this Weekend’s Quiz. The information provided should help you work out why you missed a question or three! If you haven’t already done the Quiz from yesterday then have a go at it before you read the answers. I hope this helps you develop an understanding of modern monetary theory (MMT) and its application to macroeconomic thinking. Comments as usual welcome, especially if I have made an error.
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                  Posted in Saturday quiz | 4 Comments

                  The Weekend Quiz – July 8-9, 2017

                  Welcome to The Weekend Quiz. The quiz tests whether you have been paying attention or not to the blogs I post. See how you go with the following questions. Your results are only known to you and no records are retained.
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                    Posted in Saturday quiz | 2 Comments

                    More Germans are at risk of severe poverty than ever before

                    Just how poorly the Eurozone is performing is usually illustrated with reference to Greece, then Spain, then Italy and Portugal. The weakest links among the Member States. Not to mention Cyprus, Finland and then some. But the other way of looking at the same question is to focus on the strongest link in the currency union – Germany. A new report from DIW Berlin (German Institute for Economic Research) (released July 5, 2017) – Einkommensschichten und Erwerbsformen seit 1995 (Income levels and forms of employment since 1995), which is only available in German, tells a pretty sombre, if not bleak story as to what has been happening in the Eurozone’s powerhouse over the last 18 years. It demonstrates that not only is the German model wrong for the rest of the Member States, but it is also not generating sound outcomes for its own citizens – well the lower- and middle-classes to be more exact.
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                      Posted in Eurozone | 16 Comments