Page 4, 18th December 1953

18th December 1953
Page 4
Page 4, 18th December 1953 — THE SKY IS NOT THE LIMIT

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DESPITE the fundamentally good understanding between the political leaders of the Government and the Opposition, grave industrial unrest is again threatened.

As regards this immediate danger of industrial disruption, it is important to note that it is in a nationalised industry that the gravest trouble for many years has broken out. This point is important because it tends to show that main industrial unrest today has at bottom little to do with the old controversy about profits and wages.

There are agitators, and even responsible political leaders, who go oat of their way to inflame opinion with accusations that private enterprise is increasing dividends and consequently taking money out of the pockets of the worker. They do not, of course, remind their followers that the taxation system in this country makes it virtually impossible for the.great majority of shareholders to command an income that is excessive in terms of the present cost of living.

DURING the war, it will be recalled, the country's Christian leaders, including Cardinal Hinsley. pressed for a social system which would eliminate extremes of wealth on the one side and extremes crf poverty on the other.

Though it is true that a very small number of people can still, through capital profits of one kind or another, command a high spending power, while inheritors of wealth accumulated in the past can realise their capital, the hopes of those Christian leaders, so far as excesses of wealth are concerned, have been largely fulfilled.

Nor can there be much doubt that as times go on, the process will continue. Capital profits may in some way or other be subject to tax, and inherited wealth win gradually be dissipated.

Moreover, as the conditions of living change, with houses growing smaller, social life and private entertainment becoming more modest, and education and other costs being more fairly shared, so will the need for large incomes disappear. Even now, the sums spent on drink and tobacco suggest that there is a fair elasticity in the case of many four-figure incomes.

As regards the other wing of the community, those who earn or possess least, we have still to face the position of many who live on pensions or small savings, and who undoubtedly do not have enough. Equally, there still exist wages levels which are below or on the border of what the Christian would call a just family wage. Some railway wages are undoubtedly in this category.

The trouble, of course, is that the rise in the cost of living has often outpaced the rise in wage levels; and the tragedy is that the rise in wage levels has been a vital factor in raising that cost of living.

' This is the fundamental problem of industrial unrest in this country today. It has little or nothing to do with the share of the national income which the "rich" take, not only because there are few really rich in relation to the quality of the services they render to the common weal, but because the complete distribution of their share would make virtually no difference to wage rates.

I N the case of the typical threatened railway strike, the problem lies wholly within this publicly owned enterprise. The absolute raising of wages means higher fares. Higher fares mean a rise in the cost of living. A strike could only mean a considerable loss to the country's whole economy, with the possibility of losing ground permanently in the vital export market. Hence, again. rising prices and less real wealth to distribute equitably within the community.

It is true that party politicians can bring out other accidental factors, such, for example, as the present Government's policy on food subsidies or its denationalisation of road transport. With regard to the effect of freeing the food market, the figures certainly do not indicate that wages as a whole cannot cover the cost of necessaries. The national income this year as compared with last year has stretched to considerable increases in the purchase of tobacco and household goods, and substantially diminished only in entertainment and beer (while spirits have increased).

But whatever importance we may attribute to these factors, they do not touch the fundamental truth that the real problem is not one of wage-earners versus either the rest of the community or the "rich," but one of establishing a wage structure as equitable as possible within the means of the community as a whole. Neither wage demands nor strikes, on the one hand, nor changes in the ownership of enterprises or in the distribution and exchange of the wealth it creates, on the other, can make any substantial difference.

We are, in fact, using an out-dated wage machinery and structure, and everyone knows it.

There is. however, a conspiracy among politicians to hide this truth, not only because there is great fear of organised labour and of electoral repercussions, but because realism in this matter will make it obvious that the ceiling to all wages and salaries is rigorously fixed by the amount of wealth that is produced and the need for capital to maintain the future of our industry and its export selling capacity.

There are still far too many people, in all sections of the community, who fondly imagine that for them personally the sky is somehow the limit of what they could earn. It is not. What we can produce and sell is the absolute limit.

Let that truth be universally realised, and then it will be possible to get down to the realistic study of wage and salary rates in terms of the country's productive efficiency, within those principles of limiting all extremes of poverty and of wealth for which the Christian leaders of this country called during the hard and sobering days of war.

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