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In which I get narky with the IEA
Monday, June 22nd, 2015 01:47 pm
They've apparently "proved" that tax credits are not a subsidy to employers to pay crap wages in this piece here, but I think I've spotted a tiny flawette in the entire premise of their argument. The premise of their argument is that "employers generally pay people according to the productivity of their work". Errr no. Really, really, no.
Employers pay people as little as they can get away with on the basis of how easy the person would be to replace if they walked out tomorrow, how much training and hassle it would take to get a replacement, and so on. People who get paid £100,000 a year for signing a few forms are not more productive than people who actually make things for minimum wage, that's utter bullshit. People who get paid £100,000 a year for signing a few forms are just harder to replace, because they have to have the right lines on their CV and to know which forms are worth signing and which are not etc.
Now, I'm not saying the £100,000 a year person isn't worth it to the employer. Society has decided that knowing which forms to sign is more difficult and important than actually making things, and so that person gets paid more. I accept that is the way of the world. But to pretend it's because that person is more productive?
No, absolutely not. The productive people are always, always at the bottom rung of the ladder, and the further up the ladder you go the more actually productive people it's needed to sustain the leeches - and I say this as someone who has recently joined the leech class.
Now whether tax credits are a subsidy to the employer for paying crap wages to the actually productive people, or a subsidy to a stupid economic system that doesn't value actually productive people is a different argument. But the idea that employers use productivity to decide how much they are going to pay someone is utter bollocks. Sorry, IEA.
Employers pay people as little as they can get away with on the basis of how easy the person would be to replace if they walked out tomorrow, how much training and hassle it would take to get a replacement, and so on. People who get paid £100,000 a year for signing a few forms are not more productive than people who actually make things for minimum wage, that's utter bullshit. People who get paid £100,000 a year for signing a few forms are just harder to replace, because they have to have the right lines on their CV and to know which forms are worth signing and which are not etc.
Now, I'm not saying the £100,000 a year person isn't worth it to the employer. Society has decided that knowing which forms to sign is more difficult and important than actually making things, and so that person gets paid more. I accept that is the way of the world. But to pretend it's because that person is more productive?
No, absolutely not. The productive people are always, always at the bottom rung of the ladder, and the further up the ladder you go the more actually productive people it's needed to sustain the leeches - and I say this as someone who has recently joined the leech class.
Now whether tax credits are a subsidy to the employer for paying crap wages to the actually productive people, or a subsidy to a stupid economic system that doesn't value actually productive people is a different argument. But the idea that employers use productivity to decide how much they are going to pay someone is utter bollocks. Sorry, IEA.
