Quote:
Originally Posted by Osem
Yes it is a global market and how do you suggest UK PLC competes with that global market unless we make efficiencies, drive costs down and start creating wealth as opposed to borrowing? Having already lost so many jobs (service sector, manufacturing, hi-tech etc.) to the likes of India and China you appear believe that UK workers can still be insulated from the harsh reality and have a God given right to jobs, better pay and conditions. The only way for this to happen is if sufficient wealth is created to fund those jobs, salaries and conditions and why would companies competing in your global market choose to employ people here if the cost of so doing (via tax, regulation etc.) is so much greater than elsewhere? The countless £billions being paid in interest on our debt every year aren't generating any jobs, building any schools or anything else are they. It's money wasted.
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how does driving wages down whilst having high inflation create wealth?
In truth to compete we need deflation, the dole in the UK is more than the average salary in romania. The difference between ourselves and some countries is immense. But we cannot drive wages down without the cost of living going down with it, it doesnt compute. Taxes for the vast majority of people only makes up a minorty of living costs, so cutting taxes wont be sufficient if the idea was to deflate living costs via cutting taxes. Things like housing costs, food, electric, gas, petrol all need to go down as well.
The truth tho is these jobs didnt need to go, companies were making money without taking such action, however in a capitalist fashion where profit growth is demanded boss's under pressure have made such moves to improve the bottom line. I seen the tricks they pull, when I used to work for walkers crisps in a management position there used to be briefings with shop floor staff and the story went like this. They were told the company made a loss/profit not based on actual profit but rather on profit targets. So eg. if the target was 100million profit and we made 86 million profit the staff were told we made a 14 million loss and hence a reduction of staff on the shop floor as well as compulsary overtime (without overtime wages). Those who didnt sign up for the work time directive were simply let go. Each year the profit target went up without a realistic reason justifying how it could be achieved, it simply went up. Occasionally automation coming in (which reduced the staffing levels) could justify it but not every year.