Monday, May 26, 2008

Cost of Labour II

I'm busy, but I'm too annoyed not to respond quickly to this. The gist of it is that opposing immigration controls is all very well, but to take one's lead from Marx is to subject oneself to misleading Victorian tropes. Hence:

For better or worse the situation in the UK isn't really consistent with Marx's predictions of a vast proletarian class with the capitalists and their retainers living like plantation owners among their slaves.

That is, of course, a caricature of marxism that originates in the revisonist literature of Kautsky and Bernstein. Whatever the connotations of the word 'proletariat', the sociological use to which Marx puts it could hardly be clearer: it refers to those who do not have access to the means of production and are therefore compelled to sell their labour-power in order to live. This does not necessarily entail plantation-like arrangements or any other kind of slavery than economic compulsion. It is quite compatible with higher standards of living - actually the intensity of exploitation may be increased in circumstances where the standard of life is higher. But it is on this basis that the author upbraids me for mixing up 'middle class' and 'working class' wages:

Instead there's something like a working class amounting to 35% of the population, with perhaps 55% of the population belonging to a middle class whose income is subsidised (tactically or accidentally rather than for reasons of social justice etc) by property income.

I'm afraid this is an estranged Blairite fantasy. There is not 55% of the population living on income from property, or even receiving income substantially subsidised by property. Most of the population do not own shares (the vast majority of which are owned either by multinationals or by pension and insurance companies) or second homes from which they could profit (about two million adults own second homes). There are a large number of private shareholders, 11 million in 2004, just over a third of the working population. Millions of those owners will not be part of the working population, so revise the proportion down as you see fit. Most, 56%, do not even have private pension schemes, from which they might indirectly acquire a profit. And realistically, in most cases such schemes will, where they do not disappear into a financial black hole, simply deliver deferred wages. All of which is reflected in the distribution of wealth. The bottom 50% of the population owns less than 6% of the wealth, and the bottom 75% of the population owns just over a quarter of the wealth. So, I search in vain for this 55% of the population who are profiting from the labour of others by virtue of their ownership of property.

All of this builds to what I think is the main point, which is that in adopting Marx's formulation on the determinants of wages (the reproduction of labour power), I produce an argument that is "bizarrely amenable to the kind of xenophobic nonsense Lenin rightly deplores". That argument was that: "The combined costs of reproducing one's labour power as a Polish worker is lower than the cost of reproducing one's labour power as a British worker." In fact, it isn't at all compatible with the anti-immigrant argument that immigration reduces wages. Recall that one of the arguments of the government and various pro-market commentators in general is that immigrants are in fact doing jobs that British workers refuse to do, and that we should welcome this as healthy competition. That is an argument for exploitation, and it assigns to workers themselves the key determining role in the level of unemployment, implying voluntary unemployment due to laziness or being 'spoiled' by a comfy welfare system, and that if they only shifted themselves and accepted a slightly less lavish lifestyle they could have paid employment. In pointing out that wage differentials are socially determined, not the result of some personality quirk or stubbornness on the part of unemployed workers, one concedes nothing to the anti-immigrant argument. In fact, in saying that lower wages for migrant workers are partially the result of the lower socially determined cost of reproducing labour power (that includes the cost of supporting families) in the country to which they will return, one can explain why employment soars as a result of migration. In contrast to the anti-immigrant scenario of scarce jobs being fought over by a large number of people, this analysis (and the empirical data) would indicate that jobs are created by the availability of cheaper labour (this doesn't take into account the large amount of migrant labour that is just making up for specific skill shortages). And by doing these jobs, immigrant workers can actually increase the demand for 'native' workers.

Now I pointed out that overall wages increased. The blogger 'catmint' prefers to talk about a nebulous notion of 'working class wages' - defined apparently by nothing more concrete than their being on the lower end of the income scale. In those lights, 'catmint' maintains that 'working class wages' stagnated as a result of immigration. The study cited in the earlier post indicates that wages didn't rise as quickly as they might have for lower income earners during the period of increased migration of Polish workers. This has been siezed on by reactionary commentators who have long argued that immigration hurts unskilled workers. Let me just point out the general empirical picture on that score. According to Nigel Harris almost 200 econometric studies have looked in vain for this effect in the US, where immigration is much more intense, and haven't found it. You can see one such here. It is a debatable effect, it is temporary, and it is slight where it is detected. Further, "tend to affect earlier cohorts of immigrants rather than the historical poor of the US – blacks or Hispanics". In Europe, a recent analysis of eighteen studies on immigration found that the reported effects on wages vary, but they all tend to "cluster around zero".

About those weasel words, "bizarrely amenable". Might I just point out that conjuring up a middle class majority is "bizarrely amenable" to one kind of right-wing propaganda, and conjuring up an immigrant threat to the working class "bizarrely amenable" to another kind entirely?