The Tribune

EDITOR, The Tribune.

An increased Minimum Wage – Can we afford it? A silly question.

The financial and economic gurus here in The Bahamas commenting on the minimum wage have been educated by, and within, a system that has failed. Shown clearly to have failed. It is not without irony that while we are having this discussion, millions upon millions of people in dozens of countries around the world are in the streets protesting the lack of being able to “make it” on their wages. And, here in The Bahamas, we see and hear the rumblings, as well.

There is nothing about the neoliberal agenda, under which most of the world now operates, which has shown anything resembling fairness, sustainability, justice or common decency for the average person. It should surprise nobody. These policies were designed by the major money handlers, the IMF, the World Bank, Wall Street, the World Trade Organisation, the “financial geniuses”, the rich.

What has been shown clearly, year after year for decades now, is that the world’s resources are being concentrated into fewer and fewer hands. Any thinking person, who looks at the gross income and wealth disparity which exists in the world today, and thinks this is OK, is an intellectual and moral failure, a sellout.

What decent person can defend a system such as this?

The very idea and main thesis of “economy” is predicated on the idea of fairly allocating the earth’s scarce resources. Don’t we realise that the whole idea, the whole construct of our economic system, is merely a human creation? Entirely made up by us. Or, should I say, made up by those with the power and money to do so.

The arguments against a liveable minimum wage come directly from this same made up nonsense that those who appear to be knowledgeable, with their money and diplomas, are continually pushing on us. Can we not see clearly that their precepts are simply not working for most of us?

Understanding Classical and Keynesian economics, as opposed to this failed neoliberal model we now operate under, would do wonders to open some eyes. It would also illustrate that every time taxes are raised, and as the cost of living increases, there is less money available to spend into the economy.

When more money enters the economy, via increased wages, so too does the buying power of these workers whose wages were increased. Henry Ford understood that to sell more cars he needed to raise the wages of his own workers. Yet somehow today, “leaders” are cautioning that businesses and our government may not be able to “afford” a higher minimum “living” wage. Is this because they are ignorant of how an economy works? In most cases, yes.

As wages increase, more money circulates into the economy based on the “multiplier effect” alone. Give a rich person a dollar and they put it in the bank. Give a poor person a dollar and they spend it immediately, into circulation in the local economy. This is well known and understood in economics. More money available, more demand for businesses goods and services. More demand for goods and services leads to better business outcomes and hiring more workers. More business means more revenue through fair taxation for the government to operate.

When this simple idea is thrown in the rubbish bin, as it has been for decades now, the results are exactly as we would expect them, and as we see them today. The poor class growing exponentially. The rich gaining ever greater shares, the lion’s share, of the world’s resources: money, land, politics, security. And, a faltering economy. Because we are constraining it, not developing it.

Do I really need to say these things?

Our government, along with most others, clings to a clearly failed model designed by the world’s richest people to benefit themselves. Why should this surprise anyone? Seriously! Can we not see where most nation’s constitutions, laws, ownership rights, religions even, are based on the desires, and for the benefit, of those at the top? Can we really not see this? Those whom the newspapers interview for their expert and educated views on the minimum wage effects are those educated by the same universities which serve the rich and politically relevant. The same ones which have completely failed the majority of humanity. Correct, or not?

Everyone knows that higher wages will be passed onto the consumer. Every business cost is passed onto the consumer. Every one! Isn’t this why businesses had less of a complaint about the raising of VAT than the rest of us? Who really pays VAT? The businesses pass it on to us. They don’t pay it. Even if their cost of compliance goes up, that cost is also passed on to us. Sadly, many business owners went along with this hike in VAT, despite the obvious negative effects on our Bahamian economy.

The real question is, and should be, “How do we stimulate our economy.”

Presently, this question has been completely avoided by the loud and distracting calls for more and more Foreign Direct Investment. FDI does nothing to more fairly distribute our common scarce resources, nor does it facilitate raising our own workers standard of living, via increased wages. All it does is to kick the can down the road, instead of allowing for a fair, sustainable, not to mention an eminently Christian way of being rewarded for a good day’s work; to live as respected human beings with a liveable wage. Sustainability does not mean relying on an ever increasing economic diet of FDI.

The neoliberal agenda, which includes Structural Adjustment programmes under which we, and most of the world now operates, is a failed system. The Structural Adjustment programmes being pushed onto the world, include; reducing wages, cutting social services, privatisation, opening borders to trade and raising taxes. Who is left to defend these practices from a moral perspective? This is what governments must do to qualify for these big loans taken out in our name, to be paid back on the backs of our children. So naturally, the politicians who are kept in office by these big loans are the last to speak up on the moral implications, and hazards, of these realities of indebtedness and deals with the devil.

I am saddened by the narrative of the “professionals” who control and frame the conversation. As if, there are no adults in the room. The newspapers and media it seems, can only hear their voices. Never the voices of suffering from the vast majority of humanity, no matter how well articulated. We are not allowed to discuss this suffering it seems, under this pre rational neoliberal economic agenda. Neo-slavery is what it should really be called. An oppressive system which is defended by men and women in empty suits, with diplomas on their walls, whereby the rest of us continue to toil, sweat and labour for the benefit of the few.

There is no clearer indication of a lack of leadership than to have those people, all well known to us here in this small country, continue to cheerlead for a system that is designed to help the chosen few. While leaving the vast majority of us to wither and die on the vine in one of the richest and most productive periods humanity has ever known.

The question should not be: “Can we afford a raised minimum wage?” The real question should be, “Isn’t it about time we treat all people with respect and dignity by insuring a living wage, while at the same time stimulating our economy?” This is what the minimum wage debate is really all about, though some would argue otherwise.

NORMAN TRABULSY Jr

Andros,

December 11, 2019.