It is both easy and jolly good fun to mock our left-field Tory Mayor of London, Boris Johnson. What a card, eh? But credit where credit is due. Johnson is on to a winner in backing the Living Wage, which this week is being celebrated with a number of events organised by the Living Wage Foundation in collaboration with cooperating employers, trade unions and other groups.
Johnson’s arguments and active backing for the Living Wage are on firmer ground than the soundbites uttered recently by other politicians of various political hues. But still, there are some issues with the the economics-lite arguments put forward by public figures who support the Living Wage. Arguments which cannot be ignored in the longer term.
That celebrated neo-marxian columnist for the Investors Chronicle Chris Dillow writes of this dodgy reasoning as an example of the “fallacy of composition”, and he has a point of sorts. At least some of the potential economic benefits of the Living Wage trumpeted by Milibands Major and Minor, and reported last week by Stephanie Flanders, could disappear if all firms were to pay Living Wage rates. But there is a degree of chicken-and-eggism in this, and the hypotheticals put forward by Dillow could so easily be countered by employers who react constructively to across the board wage rises at the bottom of the food chain. Just as they have done with the Minimum Wage.
I have a lot of time for Dillow’s constructive contrarianism, but in this case he’s wrong. For one thing we shouldn’t expect too much of politicians attempting to sell an idea with mere soundbites. Even if the idea is essentially a good one.
The National Union of Journalists has fought and won many media industry battles on behalf of paid-up members and others for the Minimum Wage and Living Wage, and we support the work of the Living Wage Foundation. I am not so bothered that the current campaign, including Living Wage week, fails to address the root causes of the problem of poverty wages. The Living Wage affects, or potentially affects, very many people in the here and now, and an improvement in their standard of living is not only worth fighting for, we have a moral duty so to do.
As for the bigger picture, I would urge progressively-minded critics of the Living Wage concept to use the high public profile of the campaign. They should piggy-back on the Living Wage campaign to argue constructively for longer-term solutions to the problem of ever increasing wage disparities, and the unholy cross-subsidising alliance between capital and welfare state that pushes down the wages of unskilled and low-skilled workers.