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15 September 2010updated 26 Sep 2023 7:41am

“Hack away“ hacks hack me off

The right-wing flannel industry is talking us into the social and economic doldrums.

By Patrick Osgood

The press bristles with indignation today over Office of National Statistics figures that show that, on average, public sector workers are paid £136 more — inclusive of pensions — than their private sector counterparts.

The implication here is that — surprise surprise — public sector workers have it far too good, and that in the spirit of a deeply unpopular and possibly self-defeating austerity plan their pay should stoop to private sector levels. The Telegraph invents a myth, in order to — in one of those joyous self-affirming turns of phrase — avers that the ONS findings:

threaten to undermine calls by the Trades Union Congress at its conference in Manchester this week for “civil disobedience” and co-ordinated strike action in protest against the Government’s planned public sector spending cuts.

When in fact they do no such thing. Strike action is being considered because, for one, a constituency greater than the population of Greater Bristol is about to be made jobless, and their lives get a little Hobbesian as a result.

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Pray tell, what sinister and secretive connivance has the public sector bagged such riches? Those darned unions of course! The Mail describes the democratically-elected heads of these organisations “barons”. Many commuters may think this title befits Bob Crow — and it is only one rank below the peerage rank enjoyed by the Mail‘s Rothermere family — but it by no means describes Brendan Barber.

Who tells the press the greedy public sector and the unions are to blame?

Well, the Mail is as good a place as any to start. It reverentially quotes the TaxPayer’s/Teabagger’s Alliance’s Emma Boon as if she were an academic instead of a campaign manager. Like the Tea Party, the TaxPayer’s Alliance has pretences of being a “independent grassroots campaign” but is largely funded, backed and orchestrated by a cabal of millionaires. These include Stuart Wheeler of spread betting, risible Trust party and “fruitcakes, loonies and closet racists” fame. One of the TPA’s directors, Alexander Heath, has nothing to complain about: he pays no UK tax because he works for the TPA from his farmhouse in the Loire valley.

‘Business leaders’ short-change the electorate twice: first and directly in the workplace, where the ONS has made it official that they officially screw their workers compared to their public sector counterparts, and second by the proxy of the press and ostensibly laudable groups like TPA and think tanks to misdirect the focus of the electorate’s (rightful) feelings of injustice and unfairness. Wealth pays handsomely to deflect scrutiny with paranoid narratives of national decline, special interests, oppression and so on.

The Mail‘s article on this issue canvassed the usual recidivist free-market zealots at the influential Institute of Economic Affairs and Reform think tanks. Both bodies lionise the legacy of Thatcher’s totem, Fredrich Hayek, who espoused the liberating principles of the market without troubling himself with the iniquituous process by which things got there. Both give themselves a diaphanous coating of independence, something the IEA has been willing to completely forgo to protect its credibility.

Reform recently hosted Ruth Richardson, ex-New Zealand finance minister, for a for a lecture on reprogramming government. Richardson — who recently declared this nation “bankrupt” – lent her name to the ‘Ruthanasia’ budgetary program that led to mass unemployment, wage depression, leaky homes and fee-paying healthcare. Amid the conventional pieties she declared, without apparent shame or irony, that the coalition needs to act against the “scourge of special interests who will argue for preserving the privilege of the few at the expense of the many”.

Patrick Nolan, the IEA’s chief economist (late of Reform) claims “It is not fair that the private sector has borne the brunt of the adjustment from the recession when the public sector has been largely protected”. Mr Nolan presumably sees fairness in inflicting 600,000-strong retrenchment on a public sector that had nothing to do with an asset-bubble, finance capital-created crisis. We are, of course, “all in it together”. But then, Nolan opposes a tax on the banks that got us in this mess, despite better arguments from better economists, it’s clear in whose interests he argues.

The IEA plays a similar game with pensions, constantly attacking public sector schemes via a seemingly objective body while remaining silent of the much more severe private sector deficit. The implication being the public sector should come down to the cretinously low bar set by the private sector, which increasingly chucks employees into the Pension Protection Fund. Left Foot Forward nails this.

Nolan’s boss, Mark “hack away” Littlewood, asks in the Telegraph “Why should their higher salaries be paid for by waitresses and hairdressers? An attack on public sector pay is not an attack on the poor but the privileged.” This verbal drek wilfully ignores that the income distribution in this country is sufficiently skewed that the top 1 percent of income earners own 21 percent of total UK wealth (though they only pay 8.6 percent of total UK income tax). The social contract dictates that the wealthy, not the poor, pay the public sector wage premium. They currently do to some extent, and they don’t like it one bit.

So much for the right-wing narrative: even the IMF(pdf) now takes a more Keynesian view, and undermines Osborne’s sado-monetarism, VAT hike and idea of an export-led recovery, by arguing that “a recovery in aggregate demand is the single best cure for unemployment”.

Using the same ONS data, it is possible to tell this story the other way around, in a way that unions and the public sector should be proud of.

If you join a union, your pay is likely to be higher. Unionised workers average wage in all sectors in 2009 was £13.60, against £11.80 for non-unionised workers, and unionised public sector workers enjoy a 19% wage premium over their non-unionised counterparts. Are these people getting too much? No. Private sector workers — outside the top 10 percent — are not getting paid enough. And they know it.

If you work in the public sector, you are more likely to be able to work flexibly. You have better job security (Littlewood admits “the likelihood of losing your job in the private sector is much higher”). The public sector is more professional, having largely farmed out ‘basic’ jobs to the private sector. It is the sector that teaches, heals, protects, and administers, and we should all be proud of it.

Worker-focussed management can lead to waste. Indulging rather than invigorating the rump of the structurally unemployed created by Thatcher’s Hayekian adventure was a mistake. Quangos have been too many, too expensive, and too pusillanimous. But none of this undermines a protest against the Chancellor’s determination to create a Hayekian state at a cost of mass unemployment and immiseration.

The top one percent would like to control the ‘austerity’ debate, by getting the ostensibly respectible voices of their think-tanks to disseminate their orthodoxies via their press. The right-wing press (with Mary Riddell a notable exception) do not query the coalition’s idea that removing a sizeable proportion of the total UK workforce will so more social and economic harm than good. They get schooled on the bond market. They try to dress up data showing that the only job people can get now is an insecure, part-time one, as a sign of recovery.They report on research that explodes Osborne’s prescription. They tell us that investors would rather put their money into anything other than austerity Britain. They ignore these facts in their editorials.

We should reject the pablum of the faithful and ask instead for a proper debate of what kind of resurgence country we want, and which economic policies will get us there.

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