Here’s a proposal for a new law that would undoubtedly save money. Every time a politician or economist moans about the minimum wage being too high, he or she should be required to live on it.
The law, I believe, should be applied retroactively so that it will affect Jean-Claude Trichet. When he was still president of the European Central Bank in 2007, Trichet thundered that “excessive wage regulations” were undermining job creation. “Setting minimum wages at levels which are not in line with productivity reduces the employment chances of less skilled workers and the unemployed,” he added.
Under a clause introduced especially for him, my law would forcibly return Trichet to his adopted hometown of Frankfurt, where he would spend eight years on a building site at the lowest level of pay for a migrant worker in that industry. He would not receive his ECB pension or any ancillary benefits during that time; no cost-of-living adjustments would be made to his income because, as he would surely agree, that would involve “excessive wage regulation”.
As some of the intended victims of my proposal appear unburdened by a sense of humour, I feel obliged to admit it is not serious. On second thoughts, perhaps the politicians and economists in question do have a sense of humour, albeit a very twisted one.
Sick joke
Data published at the beginning of February by that number-crunching agency Eurostat show that monthly minimum wages in the EU range from 138 euros in Bulgaria to 1,800 euros in Luxembourg. In all three of the Baltic states, the minimum wage is less than 300 euros per month; in Romania it is 161 euros. Greece stands at 877 euros; Spain at 748 euros. Even when you realise that these statistics don’t take account of differing price levels, any attempts to portray these salaries as extravagant amount to a sick joke.
By seeking to cut pay, the main EU institutions are exceeding the limits of their power. The Maastricht treaty, which came into effect in 1993, stipulates that the Union will leave questions of remuneration up to its national governments. This provision has been maintained by the Lisbon treaty.
Some unsavoury characters in the Brussels bureaucracy have nonetheless invaded this policy domain by resorting to underhand tactics. Writing for New Europe last week, I noted that Charlie McCreevy, the former European commissioner for the single market, is an acolyte of Margaret Thatcher. In 2005, he was even more extreme than the Iron Lady when he visited Sweden and publicly supported the Latvian construction company Laval over its demands that its operations in Sweden shouldn’t have to respect that country’s pay and working conditions. The following year McCreevy whinged about how a minimum wage in Germany’s postal sector of 9.80 euros an hour hampered competition.
He was not acting in isolation. A series of rulings by the European Court of Justice – including one in a case involving Laval - have provided some kind of legal cover for attempts to weaken social protections across the Union.
Broken promises
Still, the assault on wage levels illustrates why political promises must always be treated with suspicion. When Ireland was pressurised into holding a second referendum on the Lisbon treaty in 2009 (having rejected it in 2008), the “Yes” brigade swore that the country’s minimum wage was not at risk. The pledge was quietly forgotten about in 2010. As Dublin froze in a harsh winter its government slashed pay for the least well-off. Who told it to do so? Ireland’s puppetmasters in the ECB, the European Commission and the International Monetary Fund.
True, the new Irish government that came into office a few months later subsequently restored the minimum wage (one of the few election pledges it actually honoured). Yet the EU and IMF have succeeded in driving down basic salaries elsewhere, most recently in Greece.
It is fiendishly clever for right-wing ideologues to exploit whatever opportunity arises to decrease wage levels for average workers. By doing so, they distract attention away from the real excesses in the economy: how a relatively small elite possess more than any human being could ever need. The result of this distraction is that policy makers reduce the minimum wages on which cleaners, restaurant staff and people in other low-paid categories depend, instead of setting maximum wages for the wealthy parasites in the boardrooms of hedge funds and corporations.
Surveys by the investment bank Merrill Lynch (itself a parasite) repeatedly show that the rich are getting richer. According to its latest findings, the number of “high net worth individuals” (a HNWI is essentially a fancy term for millionaire) in Europe rose by 6.3% in 2010. In total, there are 3.1 million HNWIs on this continent (including Russia). Their total net wealth comes to an astronomical 10.2 trillion dollars.
Among the wealthiest people in the EU are Amancio Ortega from Spain (he of Zara fashion fame) with assets worth a cool 31 billion dollars, Frenchman Bernard Arnault (head of luxury goods firm Louis Vuitton Moet Hennessy; value: 41 billion dollars), the German chief of Aldi supermarkets Karl Albrecht (value: 26 billion dollars), the Swede behind the trendy threads of H&M Stefan Persson (value: 25 billion dollars) and Frenchwoman Liliane Bettencourt of L’Oreal (value: 24 billion dollars).
Between them, this quintet sell handbags, cardigans, perfume and biscuits for a living. How does that make them entitled to such fortunes?
●First published by New Europe, 19-25 February 2012.
Showing posts with label Charlie McCreevy. Show all posts
Showing posts with label Charlie McCreevy. Show all posts
Monday, February 20, 2012
Monday, February 13, 2012
Respect our elders: stop this blather about pension time bombs
Pension time bomb. We have been warned about one so often that I often lie awake terrified by the prospect of a mass combustion of people with white hair. I can no longer walk past the communal gardens beside my house because the senior citizens tending to them look far too menacing.
Let’s get a grip here. Medical advances and maybe some other factors have caused life expectancy to increase. Shouldn’t that be a cause for celebration? Yet instead of respecting our elders, as I was taught to do as a child, we are treating them as a burden that society cannot bear.
In the coming days, the European Commission is scheduled to publish a paper recommending that retirement ages should be raised and that the possibility of retiring early should be restricted. The paper will stress that the EU executive is not trying to muscle into an area of policy-making traditionally undertaken by national governments. Nobody should be fooled by those assurances; the EU executive is determined to acquire new powers for itself by whatever means it can.
Using the new role as inspector of the budgets of individual EU countries that it has performed over the past two years, the Commission has advocated wielding a machete towards pension schemes across the Union. The “technocrats” who have effectively mounted coups in Italy and Greece appear happy to oblige.
Drive to dismantle welfare states
This is not simply a matter of requiring workers to stay in jobs an extra few years for the greater good. It is part of a drive to dismantle welfare states and to make Europe almost indistinguishable from the United States. The real intention of our political masters is to let selfishness triumph over solidarity.
Increased life expectancy, as I have already stated, is a marvellous thing. Yet income remains a key determinant of how long you live. About one out of every five older people in the EU is at risk of poverty. The poor are statistically more likely to die earlier than the wealthy. How disgusting, then, that the comfort offered to the disadvantaged in their final years is being reduced as a result of extreme economic prescriptions written in Brussels.
Women will be the worst affected by the demolition derby. In France, women’s pensions are on average 38% lower than those of men. Women teachers across Europe are paid between 14% and 19% less than their male colleagues, according to a 2009 study by the organisation Education International. As pensions are usually based on a proportion of end-of-career wages, female teachers receive far smaller pensions than men when they retire.
Thatcher-inspired extremism
A strong hint about the real agenda being pursued was dropped by Charlie McCreevy when he was the EU’s commissioner for the single market in 2005. “One of my main tasks over the coming years will be to ensure that the European regulatory framework for financial services supports the emergence of secure market-driven responses to retirement financing,” he said.
Though his words sound technical, his ploy was intensely political. McCreevy was intent on enabling the private sector to take over responsibility for public affairs. Under his Thatcher-inspired vision, good pensions were not something to which everyone should be entitled. They were to be determined by market forces.
The game he played proved ruinous. McCreevy stubbornly refused to introduce proper oversight of hedge fund managers and the other out-of-control gamblers whose reckless behaviour contributed massively to the current financial crisis.
The financial alchemists that he accommodated continue to lord it over the rest of us. In November last year, the European Central Bank stated that “insurers and pension funds with 1.1 trillion euros invested, hold almost 20% of the debt securities issued by euro area governments, which make them an important provider of governments’ funding”. There is only one way I can interpret this message: it is markets, not elected governments, which call the shots.
Perhaps the most offensive aspect of this drive is the way politicians behind it claim they are acting in the best interests of older people. “Active ageing seeks to promote better opportunities for older people on the labour market through accessible workplaces and age friendly working conditions and allow them to achieve an adequate income in old age,” László Andor, the EU’s social policy commissioner, said recently, while maintaining that the welfare systems now in place are unsustainable.
Many of us have friends or acquaintances over 50 who have been rejected for jobs solely because the employers wanted to hire someone younger. This indicates that there is a bias against hiring people in the 50 to 65 year age bracket. If Andor thinks that raising the retirement age will get rid of prejudice in recruitment, then he is not living in the real world.
Despite their rampant ageism, employers are using blackmail to demand an assault on pensions. Jorgen Ronnest from the pressure group BusinessEurope warned in November that if the “demographic challenge” isn’t faced “companies will be forced to relocate their business to other continents due to serious shortages on our labour markets”. The threat of quitting Europe is one of corporate bullies’ favourite tactics.
In recent months and years, we have seen strikes in France and Belgium over moves to slash pensions. Right-wing pundits have slandered the strikers, by portraying them as layabouts. Far from being lazy, the strikers are fighting valiantly to preserve the few remaining decencies in Europe.
●First published by New Europe, 12-18 February 2012.
Let’s get a grip here. Medical advances and maybe some other factors have caused life expectancy to increase. Shouldn’t that be a cause for celebration? Yet instead of respecting our elders, as I was taught to do as a child, we are treating them as a burden that society cannot bear.
In the coming days, the European Commission is scheduled to publish a paper recommending that retirement ages should be raised and that the possibility of retiring early should be restricted. The paper will stress that the EU executive is not trying to muscle into an area of policy-making traditionally undertaken by national governments. Nobody should be fooled by those assurances; the EU executive is determined to acquire new powers for itself by whatever means it can.
Using the new role as inspector of the budgets of individual EU countries that it has performed over the past two years, the Commission has advocated wielding a machete towards pension schemes across the Union. The “technocrats” who have effectively mounted coups in Italy and Greece appear happy to oblige.
Drive to dismantle welfare states
This is not simply a matter of requiring workers to stay in jobs an extra few years for the greater good. It is part of a drive to dismantle welfare states and to make Europe almost indistinguishable from the United States. The real intention of our political masters is to let selfishness triumph over solidarity.
Increased life expectancy, as I have already stated, is a marvellous thing. Yet income remains a key determinant of how long you live. About one out of every five older people in the EU is at risk of poverty. The poor are statistically more likely to die earlier than the wealthy. How disgusting, then, that the comfort offered to the disadvantaged in their final years is being reduced as a result of extreme economic prescriptions written in Brussels.
Women will be the worst affected by the demolition derby. In France, women’s pensions are on average 38% lower than those of men. Women teachers across Europe are paid between 14% and 19% less than their male colleagues, according to a 2009 study by the organisation Education International. As pensions are usually based on a proportion of end-of-career wages, female teachers receive far smaller pensions than men when they retire.
Thatcher-inspired extremism
A strong hint about the real agenda being pursued was dropped by Charlie McCreevy when he was the EU’s commissioner for the single market in 2005. “One of my main tasks over the coming years will be to ensure that the European regulatory framework for financial services supports the emergence of secure market-driven responses to retirement financing,” he said.
Though his words sound technical, his ploy was intensely political. McCreevy was intent on enabling the private sector to take over responsibility for public affairs. Under his Thatcher-inspired vision, good pensions were not something to which everyone should be entitled. They were to be determined by market forces.
The game he played proved ruinous. McCreevy stubbornly refused to introduce proper oversight of hedge fund managers and the other out-of-control gamblers whose reckless behaviour contributed massively to the current financial crisis.
The financial alchemists that he accommodated continue to lord it over the rest of us. In November last year, the European Central Bank stated that “insurers and pension funds with 1.1 trillion euros invested, hold almost 20% of the debt securities issued by euro area governments, which make them an important provider of governments’ funding”. There is only one way I can interpret this message: it is markets, not elected governments, which call the shots.
Perhaps the most offensive aspect of this drive is the way politicians behind it claim they are acting in the best interests of older people. “Active ageing seeks to promote better opportunities for older people on the labour market through accessible workplaces and age friendly working conditions and allow them to achieve an adequate income in old age,” László Andor, the EU’s social policy commissioner, said recently, while maintaining that the welfare systems now in place are unsustainable.
Many of us have friends or acquaintances over 50 who have been rejected for jobs solely because the employers wanted to hire someone younger. This indicates that there is a bias against hiring people in the 50 to 65 year age bracket. If Andor thinks that raising the retirement age will get rid of prejudice in recruitment, then he is not living in the real world.
Despite their rampant ageism, employers are using blackmail to demand an assault on pensions. Jorgen Ronnest from the pressure group BusinessEurope warned in November that if the “demographic challenge” isn’t faced “companies will be forced to relocate their business to other continents due to serious shortages on our labour markets”. The threat of quitting Europe is one of corporate bullies’ favourite tactics.
In recent months and years, we have seen strikes in France and Belgium over moves to slash pensions. Right-wing pundits have slandered the strikers, by portraying them as layabouts. Far from being lazy, the strikers are fighting valiantly to preserve the few remaining decencies in Europe.
●First published by New Europe, 12-18 February 2012.
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