After Independence – What Jobs?

It is worrying when the Bank for International Settlements is suggesting that the world economy is more fragile than it was in 2007/8. I have always thought that politicians had really only pushed the problem further down the road and that nothing had actually been done to create a more stable and sustainable economic environment.

Radio 4 Today programme ran a piece about the Chinese developing a railway link from China through to Europe. This may or may not be a good thing for the West or China but it is is another signal of quite how enterprising Asia and in particular China are in grasping every opportunity to develop their economies.

The mantra by the Yes and the No campaigns has been about how it will be better for jobs in the future, either in an dependent Scotland or in the existing Union. Neither side specifies the type of jobs apart form vague murmurings about IT, Creativity, Inventiveness, Science and the like. But the West is lagging way behind the emerging economies in terms of those kind of jobs. Doubtless there will be niche markets and success stories, but we actually need to concentrate on the vast army of the poorly paid, the low skilled and the un- or under-employed. Our education system in Scotland and elsewhere in the UK is still not  fulfilling the needs of the up and coming generation. Many people, especially the young, are meandering from one unfulfilling  occupation to another, rudderless.

So what jobs will be there in the future. For a minority, there will be jobs requiring intellectual ability in Science, in Arts, in IT as well as the old professions of the Law, Education, etc. But to be really prosperous Scotland cannot afford a large group of citizens who are unable to contribute for all sorts of reasons, mostly not of their own making. One category is the jobs which cannot be readily automated and are labour intensive. These include the traditional trades of joiner, plumber, electrician, the caring professions, nurses, social care officers, home care workers, the entertainment and leisure industries such as catering, personal services such as hairdressers, public  transport particularly buses and no doubt others that I have not considered. But our education and training systems must provide young people with an enthusiasm for these kind of jobs as well as a good liberal education and it must become the norm for youngsters to expect to leave school to enter training for these kind of careers if they are not going into more academic further education. I have said elsewhere that the transition from school to the world of work is woefully inadequately catered for in our system and yet it is where most of our young people falter and often fail to grasp good opportunities.

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Changing Scottish Society

It will be a slow process converting the society and the culture in Scotland to a more people kindly model. We have lived with an increasingly aggressive Anglo-American model for many years. The mantra of the market economy, of capitalism as the the only sure method of running a country has been around for centuries and it has largely seen off its rivals. But its recent direction of travel has turned it into a monster rather than a benign method of government. Linked to a failure of democracy where governments come and go with no more than a passing nod to the hopes and fears of the people they govern, we are beginning to see the “end of era”, not unlike the last days of Rome. Are we all asleep in the so called great Western Democracies?

So what are the changes we need to make in an independent Scotland. One starting point might be the tax system. We should create a system which makes everyone pay a reasonable and fair share of the costs of the country, so the more you have the more you pay. However rather than have the burden of many people living a lifetime on benefits the tax system should encourage more and more people into worthwhile employment. Every bit of earnings no matter how small should be a plus. Earn a shilling, be taxed a penny, earn a pound be taxed ten pence. And lose none of the state benefits until you reach the tipping point when you pay in tax the same as you receive in benefits  and after that you continue to pay more and more tax than your benefits. In effect your benefits become your personal allowance.

However the economy needs to provide opportunities for work over a broad front to accommodate as many of the nations talents as possible. It starts with education and then training. it continues with support for business across a wide spectrum. Let’s be creative, make things, trade things, not be frightened of failure, encourage inventiveness within a benign tax system for enterprise and business. Let entrepreneurs flourish and make money but be sure to pay a fair proportion of the tax burden. Let’s have politicians who govern according to the wishes of the voters. Wishful thinking no doubt but that does not mean in a new Scotland we should not aspire to it.

 

Socialist Economics

Written earlier this year….

The origins of the world economic crisis which we have not yet begun to solve date back to the potential collapse of banks and financial institutions such as Northern Rock in the UK and Lehman Brothers in the USA. It has been acknowledged widely that the national leader who led the charge to bail them out was Gordon Brown who seized the opportunity to alleviate his own domestic troubles. It is ironic that a socialist prime minister who had tried as Chancellor of the Exchequer to redistribute incomes should be the one to open the flood gates to wholesale intervention in the capitalist system to help the richest people retain their wealth. It is perhaps in the nature of socialism to intervene and attempt to plan to obstruct market forces. Gordon Brown was reputed to be a tinkerer and deviser of complicated schemes which he would then defend against all rational argument. This was perhaps one of these times. Pausing for thought might have suggested to him that here was a golden opportunity to devise a new order of world finance by quarantining the banks as one would a computer virus allowing the rest of the system to recover and heal the wound.
The Second World War spawned the Beveridge Report, something substantial out of disaster. In economic terms the current crisis is as cataclysmic as a world war but so far no great game changing movement has emerged. The Beveridge Report changed Society for ever. There was never any chance of reverting to the old order. There is yet time for something as fundamental to surface from the present economic turmoil but even the so called Socialist parties have until now been more inclined to maintain the status quo than to grasp the opportunity to re-align our society.
In the West there are many intractable problems which politicians have campaigned on for many elections without actually changing anything. An ageing population, an increasing gap between rich and poor, growing youth unemployment, increasing drug and alcohol related contamination are not as intractable as many would have us believe. What is lacking is the real political will and the application of great minds dedicated to finding solutions.

The Case of IDS

When the Conservatives / Lib Dem coalition first came to power I thought at least that Ian Duncan Smith would know what he was talking about as he had given every impression of researching the benefits traps during the years in opposition. How wrong can one be???

The problem he is supposed to be solving is not the size of the benefits bill but the underlying reasons. Why do so many people, young people especially, find it impossible to earn a living wage? It is not only those out of work but also many in work who need state assistance. In the latter case the taxpayer is effectively subsidising private companies so that they need not pay their workers sufficient to live on, i.e. the taxpayer is actually subsidising the profits of these firms. Why are others unable to get jobs even though there are plenty available? Partly it is cultural. Political parties have raised expectations of the good life so high that some do not want to take on many of the menial jobs available which are now done by immigrants. It is also the climate of education. Tony Blair talked about 50% of school leavers going to university. Not once did he mention the other 50% and what they would be doing. And so schools have concentrated on the academic rather than the life skills.

There is a benefits gap. Earn above a threshold and you are no better off than if you did not work at all. That transition requires a granular tax and benefit regime which very gradually removes benefits and increases the tax take up to perhaps something near the average wage. It effectively means that however little you earn you always see something more for your efforts.

How can Ian Duncan Smith not see that by simply cutting the size of the benefits bill he is making miserable lives more miserable still and doing nothing to make Britain a better place?