Tuesday, 16 February 2016

"The Worker Deserves His Wages"- a fairer sharing of profits- full version


“The Worker Deserves His Wages”-
Why Jeremy Corbyn is right to demand a fairer sharing of profits

  In 1980 the average CEO of a UK FTSE 100 company earned 18 times the average worker. Today that difference has increased tenfold to 180 times. Meanwhile over the last 8 years average workers' wages have reduced or stagnated and only a quarter of those top companies are committed to paying the “living wage”. The world's 62 richest men now own as much as the 3.6 billion poorest half of the world. Notwithstanding a serious global recession, the last 5 years have seen their wealth grow by £1/2 trillion. (While the poorest half of the world saw their wealth decline by £1 trillion). Only 4 years ago it took 388 of the world’s richest to own so a large proportion of the world’s wealth. Add to that the extreme measures many of them take to keep their wealth from the taxman’s hands (Some estimate that £3 trillion is held in off shore accounts in British dependant territories alone). We clearly have an increasingly unhealthy economic imbalance.  The very richest are gorging themselves on an increasingly grotesque share of the world’s wealth and resources, leaving the rest of us, especially the poorest, dwindling slender portions.

 This is not some new mischief Cameron's Tories have unleashed on the country. Their policies have certainly exacerbated the situation here and of developed countries only the USA beats us for inequality. However, this is a global trend that has been developing for at least three decades. Indeed it was a New Labour cabinet minister who once famously boasted he was "intensely relaxed about people getting filthy rich." He might have been relaxed about it, but I don't believe our God is; not when so many in this world and this country have so little. It's an issue about justice for the poor, but it's more than that. It's a question about giving more people a fairer share in the fruits of this world.

 This is why I applaud the recent proposals by Jeremy Corbyn and John McDonnell to give UK workers a greater share in the profits of their employers’ businesses. As an evangelical Christian I believe this is supported by good biblical principles and would be good for our economy and our society, benefiting the many rather than just the rich few.   I also believe that the naysayers are false prophets of doom. They are simply repeating familiar false arguments used to try to block nearly every proposal for social and economic justice over the past 200 years. Those arguments were proved false then and they would prove false again.

 Just to remind you briefly of those policy proposals:

     Profit shares to workers of medium to large firms of 5% of the annual profits
     No dividends to be paid unless the firm pays the living wage
     Pay ratios to put a ceiling on how many times a firm’s average wage their top people can be paid (no figure yet proposed but I would suggest significantly less than 180 times!)
     Increased rights for employees’ co-operatives to buy into their employing company.

Opening our eyes

Most of us Christians I believe suffer from blind spots where we have not allowed God's word and spirit to illuminate fully (and I certainly include myself in that!). One of those common blind spot areas is politics and another is money. The issue of redistribution of wealth brings both issuestogether in stark relief. In considering those issues not all Christians will reach the same conclusions as I do, but, as on other political issues, my challenge to my fellow Christians is Paul’s challenge of Romans 12:2: “Do not conform to the pattern of this world, but be transformed by the renewing of your mind. Then you will be able to test and approve what God’s will is—his good, pleasing and perfect will.” Part of that is letting the Holy Spirit through His Word open our spiritual eyes to God's values and priorities for how this world should be. The other part though is opening our physical eyes to see how this world actually is, so that where it does not conform to God's pattern to seek to change it. (The opposite of the Rich Man daily turning a blind eye to the inconvenient truth of Lazarus begging at his gate). That I believe is just a part of being salt and light in this world (Matthew 5 :12-15)  and part of demolishing arguments that set themselves up against the knowledge of God- his Kingdom values being part of that knowledge (2 Corinthians  10:5).

  I wonder how far do our political standpoints as Christians actually relate to God’s values as revealed in His Word? Or how much do they instead relate to the values of this world, that we have unconsciously absorbed through osmosis from our family, friends and the media? We need to be open to God’s values and priorities for this world first and then let them shape our political views, rather than just looking for odd bits of scripture to support views we have already formed.

Sharing resources- a biblical pattern

The starting point on this issue I believe is that we are not the ultimate owners of anything in this world. The earth is the Lord's and everything in it.” (Psalm 24:1)  We are merely tenants and stewards of what we have and shall one day have to account to God for how we have managed His world’s resources. (Matthew 25:14-30- the Parable of the Talents).

 The bible of course does not pretend to set out a full political and economic manifesto for the 21st century. However, I do believe that if we look for it there are plenty of pointers there to how God wants us to share the world's resources. This can be seen especially in how His people shared their resources when they first came together, in both the Old and New Testaments.
 During their 40 years of wandering in the Sinai desert the Lord gave the Israelites manna & quail to eat. In doing so He ensured those resources were shared fairly: ”...the one who gathered much did not have too much, and the one who gathered little did not have too little. Everyone had gathered just as much as they needed.” (Exodus 16:18).

 This was a precursor to how they were to share the Promised Land when they finally entered it. It was to be divided fairly and evenly between all tribes, clans and individual families, “based on the number of names”. Everyone was to have their stake in it. It was quite different to how successful invading armies in the rest of history have distributed land and wealth. It’s usually the men at the top who take the most and their lowly foot soldiers get little or nothing. William the Conqueror literally seized ownership of the whole of England and to this day technically we’re all the Crown’s tenants. (This legal concept was given the rather apt name, “seisin”!)

 In Deuteronomy 15 God makes the point that with the abundant allocation of the Promised Land’s resources to His people, “there need be no poor people among you, for in the land the Lord your God is giving you to possess as your inheritance, He will richly bless you” (provided they continue to obey Him). (However, in almost the same breath, knowing what men are like, God sees that things won’t stay that way and sets out how they should care for the poor.)

 A few hundred years later the people asked their current leader, Samuel, to appoint a King over them.  He objected, but gave them what they asked for. However, he warned them that establishing an earthly kingship would result in an unfair and uneven allocation of the land’s resources, opening them up to exploitation. He warned, “This is what the king who will reign over you will claim as his rights: He will take your sons and make them serve with his chariots and horses, and they will run in front of his chariots. He will take the best of your fields and vineyards and olive groves and give them to his attendants…He will take a tenth of your flocks, and you yourselves will become his slaves.” (1 Samuel 8:11)

 Under Kings David and Solomon generally the land and the people prospered. Although the Kings grew rich, initially the people prospered too. They continued to enjoy their stake in the land. “During Solomon’s lifetime Judah and Israel, from Dan to Beersheba, lived in safety, everyone under their own vine and under their own fig tree.” (1 Kings 4:25).

 However, as their kings turned away from the Lord, they oppressed the people (and the kingdom was split). There was a growing inequality in the land, with the rich taking their lead from the kings and accumulating great wealth for themselves at the expense of the people generally, and especially the poor whom they exploited. (Does this sound at all familiar today?) The Lord was angered at this evil. Through his prophets He spoke out. And He did not mince His words:

“The Lord enters into judgment against the elders and leaders of his people: … the plunder from the poor is in your houses. What do you mean by crushing my people and grinding the faces of the poor?” Isaiah 3:14-15

Hear this, you who trample the needy and do away with the poor of the land.” Amos 8:4

“Woe to you who add house to house and join field to field till no space is left and you live alone in the land.”
Isaiah 5:8

 These and other sins led to the Lord’s punishment of his people who were conquered and forced into exile from the land. Yet in exile, through prophets like Ezekiel, Micah and Daniel the Lord revealed He still had plans for His people to return to the Promised Land.  And He made clear it remained His vision that once more His people should all enjoy their own fair share of the land’s resources (even the foreigners living among them): “You are to distribute this land among yourselves according to the tribes of Israel. You are to allot it as an inheritance for yourselves and for the foreigners residing among you and who have children…”
(Ezekiel 47:21-23).

Everyone will sit under their own vine and under their own fig tree, and no one will make them afraid, for the Lord Almighty has spoken. “ (Micah 4:4)

 The Lord’s people did return to the land (at exactly the time that Daniel had predicted). However, despite starting with a fair allocation of resources, men reverted to their old ways and inequality, poverty and exploitation returned.
And so to the time of Jesus, God’s own Son, come to earth not as a rich King, but born to a humble carpenter’s family. By this time what remained of God’s people were living under the yoke of the Romans and their own local oppressive kings. Jesus’s mission in one sense was completely apolitical and had nothing to do with how society was run or resources were allocated. Indeed, He disappointed many of his followers by not leading a violent revolution to kick out the Romans and establish His own kingdom. (John 18: 10-11)  Instead, He came to die a criminal’s death on a cross, to pay the price of our sins so that we could be reconciled to God.

  And yet in one sense His mission was and is very political. In heavenly terms first of all He established a new order, the Kingdom of God, “where the last will be first and the first will be last.” (Matthew 20:16) Ordinary men, women and children were invited to the “top table”, to sup with the King (Matthew 22) and to be adopted as royal sons and daughters of God (Ephesians 1). And this invitation was extended well beyond the original people of God to all people on earth (Matthew 28).  Ultimately that new order will be fully realised when Jesus returns in full power and establishes His new Jerusalem (Mark 14:62 /Revelation 21). In that Kingdom there will no more exploitation, poverty or suffering. Every citizen of that New Jerusalem will be a co-ruler with Jesus, enjoying to the full God’s abundant blessings (2 Timothy 12). This will be the final fulfilment of the Old Testament vision, “Everyone will sit under their own vine and under their own fig tree, and no one will make them afraid.”  As it says in Revelation 21, “He will wipe every tear from their eyes. There will be no more death or mourning or crying for the old order of things has passed away…Those who are victorious will inherit all this… the Holy City, Jerusalem, coming down out of heaven from God. It shone with the glory of God, and its brilliance was like that of a very precious jewel…

And through His very first followers Jesus gave us the ultimate pattern of sharing our resources now in Acts 4; “No one claimed that any of their possessions was their own, but they shared everything they had.”   

 I therefore believe that God has made clear through his Word His vision and desire that everyone should have a fair share and stake in the resources of this world and that excessive hording of wealth by an elite few, whilst others go without, is an evil for which He will judge men.

Rewards according to what we deserve

 That is not to say the Lord subscribes an exact mathematical equal division of wealth to all. The bible is also very clear that men should be rewarded according to their efforts.  He will reward each person according to what he has done.” (Matthew 16:18) and “the worker deserves his wages,” (Luke 10:7). “With the measure you use it will be measured to you.” (Luke 6:38). This is also seen in the “Parable of the Talents” in the different rewards that the King gives to his servants according to what they have done with what they were given. (Luke 19). However, the bible also emphasises that “From everyone who has given much, much will be demanded.” (Luke 12:48).
 So how should these biblical principles be applied to the owners and managers of successful businesses today? Certainly it is perfectly sound and proper that they should enjoy the fruits of their own efforts. It is only what they deserve. But do CEOs of large companies really deserve to be paid 180 times the average ordinary worker? Are their efforts that much greater?  In some (but certainly not all) cases particular CEOs may have done amazing jobs in turning around and making their businesses profitable. However, just think for a moment what has enabled them to do that? It is not simply hard effort alone. I can try as hard as I like to run the 100 metres in under 10 seconds, but however much effort and training I put it into it I am not capable of achieving it. The same will be true of most employees of any business. The vast majority of them are either not capable of or are not going to be given the opportunity to be CEO.  Most successful CEOs owe their success not just to hard work but to pure damned luck or gifts that they have been given. The gift of natural intelligence and other abilities, in many cases the gift of being born into rich families with good connections and the gift of a good private education. And as the bible says, “from everyone who has given much, much will be demanded.

It’s unhealthy
The excessive accumulation of wealth by a small rich elite is not simply unjust but economically and socially unhealthy for us all. Reversing that trend should have three particular benefits.

Low productivity is a particular issue in the UK, where our workers are now producing significantly less (goods or services) per hour than our major competitors. We are increasingly becoming a high employment but low wage, low productivity economy. Many believe one way to help reverse this trend is to provide an incentive to workers by giving them a greater and more direct stake in their employers’ businesses. Jeremy’s proposed 5% profit share would for example give the average BT employee an extra £1,200 a year. This is what some more enlightened and successful businesses, like John Lewis, already do. It is what is effectively required by law in France. Perhaps it is no coincidence that French workers produce about 30% more per hour than we do.    

 Oiling the wheels of the economy
The growing concentration of wealth in a rich elite is decreasing the available spending power of ordinary people. This is bad economics. The super-rich, increasingly soaking up the wealth, tend to hoard that wealth (especially off shore) rather than spend it. The rest of us however tend to spend the vast majority of our income. After all there is only so much gourmet food you can eat or Aston Martins you can drive. The rest of us however tend to spend the vast majority of our income. 180 ordinary workers are likely to buy a lot more cars and consume a lot more food than the CEO earning 180 times their individual incomes. This trend in the end can only depress economic growth, ultimately even to the detriment of the rich. If ordinary people don’t have the disposable income to buy the goods and services businesses are selling in the end all incomes suffer, even for the rich. Action to require businesses to give its employees a greater share in their profits cannot on its own solve this developing problem. (After all there are plenty of ordinary workers who won’t benefit being self-employed or working for smaller employers). However, it can make a positive contribution.

Increased taxes for better public services
Most of the super-rich put a lot of their wealth beyond the tax man’s reach. If more of that wealth was diverted into the pockets of ordinary folk the government’s tax take would significantly increase, because we aren’t able to take advantage of the same tax loopholes as them and (surprisingly) on average as a percentage of income pay more tax (VAT and income tax) than big corporations and their super-rich owners. This would give government the extra funds it badly needs to pay for our badly under resourced public services. After all, even the rich elite directly or indirectly benefit from public services; through the supporting infrastructure provided to themselves, their businesses and their employees. 

The wealth no longer “trickles down”
Some would argue that despite the extreme imbalance in the end everyone benefits as the wealth the super-rich generates “trickles down” to us all. The only problem is the facts no longer support this. It used to be true, but for decades now, both nationally and globally, the proportion of the wealth generated by business going to ordinary workers rather than the owners has steadily fallen. Meanwhile real average wages have stagnated or fallen and private investment in the economy are at historically low levels.  Certainly I would not advocate a communist-style economy with enforced equality and no opportunity to reap financial rewards from our own efforts. This stifles innovation and is good for no one. However, all we are talking about here is tweaking the capitalist system to put some limits on the extremes of disproportionate profit grabbing for the few at the top and provide a greater reward for their efforts for the many below them. Call it capitalism with a conscience, compassionate conservatism, social democracy or democratic socialism. It’s a recognition that pure free market capitalism is a false blind god that left to its own devices does not deliver a prosperity that benefits everyone .

Lessons from history

The establishment naysayers will argue that placing controls on what companies do with their profits will  only cause the rich and powerful to withdraw their investment from the economy will suffer and we will all end up worse off.  If we don’t play the game their way the super-rich will take their ball away! However, as things stand they are putting most of their money outside of the economy anyway, especially off shore, with levels of industrial investment in this country at currently very low levels. I would accept that if we were talking about extreme measures like bringing back a 90% top tax rate that would doubtless trigger a mass further hemorrhaging of capital. But the proposals Jeremy and John have put forward are actually very modest and potentially should prove ultimately beneficial to business. And looking back over history it was just the same sort of arguments that establishment voices put to oppose virtually every proposal for economic and social justice over the past 200 years;

  •  the abolition of the slave trade 200 years ago
  •  factory reforms to control excessive hours and dangerous conditions from the late 19th century onwards
  •  increased taxes on the rich to fund the welfare state & the NHS in the first half of the twentieth century
  • employment rights from the 1970s onwards to prevent unfair and discriminatory treatment at work
  •   The New Labour government’s introduction of a minimum wage.

·       And in every case those fears proved false. That is not to say that there was not a single ex-slave made homeless or a single worker who did not lose their job due to factory reforms or the minimum wage. However, any such losses must have been so small as to be hardly noticeable and the good done by those reforms massively outweighed any such losses. If  one had to guarantee zero casualties before accepting economic reform then millions would still be suffering as slaves or  factory serfs under appalling conditions. I have little doubt that John & Jeremy’s moderate profit sharing policies would similarly have minimal adverse consequences. As with previous reforms, nearly all profitable UK businesses (and by definition we are here only talking about profitable businesses) have too much vested interests here to take their ball away, whatever protests they might squeal now.

The Labour Party (and to a lesser extent the Liberals before them) has a proud history of promoting such economic and social reform. In doing so I would say they have been putting into practice some of the values of the Kingdom of God and realising in a small way the “justice for the poor” that Jesus will ultimately bring when He returns to this earth. (Isaiah 11:4). And it was that biblical vision that inspired Christians like Keir Hardie to help found the Labour Party. New Labour had too often forgotten its mission for social justice in its desire to appease the rich establishment. To be relevant to the twenty-first century Labour needs to renew that honourable tradition through developing new policies like these

 Note also that the Tory Party (with honourable individual exceptions) has had a quite shameful history of opposing nearly every single one of these reforms at the time they were made. Each time they put forward these familiar arguments in defence of the establishment and the wealthy individuals and businesses who have always been their benefactors. And yet as an essentially pragmatic party in time the Tories came to embrace all of these reforms, as witnessed by George Osborne’s recent attempted hijacking of Labour’s minimum wage. (And for 25 years before Thatcher the Conservative Party largely adopted Labour’s social democratic model).  

However, whilst the Tories may later accept reforms brought in by progressive parties, history shows it is simply not in their DNA to spearhead such progressive changes themselves. The vision that unites them essentially (and exemplified well by our current Prime Minister) is not principle but power and how to maintain it. And serving the interests of the rich elite who control most of our media is the best way they know to keep that power. As history shows therefore they can rarely if ever be trusted to use that power in the interests of the many where that conflicts with the interests of their rich benefactors.

I recently watched the Matt Damon sci-fi film “Elysium”. It portrays a dystopian vision of our world in the 22nd century. A rich elite have built themselves a hermetically sealed technologically advanced paradise in a space station above the earth while the millions below them languish on a dying earth. It takes a Christ-like act of sacrifice for that paradise to be invaded and the benefits of Elysium to be brought to earth.We need a democratic invasion of the current Elysium that the rich elite are now building for themselves; to share the benefit of their wealth with the many. The proposals for forced profit sharing would be just part of that democratic invasion. And it falls to the Labour Party to call us to arms.


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