Cooking the Books 2

A salaried economy, no thanks

“ From the hawkers, rickshaw drivers and shoe shiners on the streets of downtown Jakarta to the cash-in-hand car mechanics, cleaners and nannies in the smart neighbourhoods of London, the underground economy is booming”, said the Times (24 April) commenting on a report that the Organisation for Economic Co-operation and Development (OECD) had just published. Entitled Is Informal Normal?, the report estimated, according the Times, that in the world “a record 1.8 billion workers are employed in underground activities, compared with 1.2 billion in the formal sector”.

 Actually, “underground activities” is inaccurate. The term preferred by the OECD is “informal” by which they mean buying and selling activities that are not declared to the tax or social security authorities. In developed capitalists such undeclared economic activities are “underground” but are only marginal. In other parts of the world, however, – India, Indonesia, most of Latin America, Asia and Africa in fact – they amount to over 50 percent. This is mainly because they don’t have to be declared. In a chapter on “Informal Employment and Promoting the Transition to a Salaried Economy” an earlier OECD report explained:

 “In less-developed non-OECD countries, statistical estimates usually include purely informal work, which is unregistered but not hidden because there is no effective requirement for it to be declared. Formal employment with payment of tax and social security contributions becomes an ‘island’ in a large ‘sea’ of informal work. The formal sector may still account for over 50% of GDP – due to its higher relative productivity – suggesting that the benefits from a longer-term transition to a salaried economy through progressive expansion of the sector can be large” (www.oecd.org/dataoecd/8/25/34846912.pdf).

 A “salaried economy”? As one where most paid work is done by people paid a wage by an employer to do it, it’s another name for a capitalist economy since capitalism is based, precisely, on waged labour. The rickshaw drivers and shoe-shiners of Jakarta are not wage-workers. They are workers in that they work and provide a use-value, for which they are paid. But what they get from selling their service is only enough to allow them to cover the costs of being able to keep on working. They don’t produce a surplus over and above this and so don’t contribute anything towards economic development, i.e. capital accumulation.

 What difference would it make if instead of selling their service directly to the customers, they were to become employees of a rickshaw or a shoe shining company? They would still be doing exactly the same work as before and getting more or less the same money. The difference is that employers are not philanthropists. They only employ someone if there’s something in it for them – if they can end up with more money than they had invested in buying the materials and hiring workers. In other words, if they made a profit on their capital.

 Marx explained that the source of this profit is the unpaid labour of the employees; they not only transfer the value of their own upkeep to the product but also a further amount for which they are not paid and which belongs to the employer. This extra value is new value, most of which is accumulated as new capital. The OECD wants to turn rickshaw drivers, shoe shiners and the like in countries where informal work is currently high into salaried wage-slaves because this is what the capitalist development they favour involves. As socialists, we stand for the “Abolition of the Salaried Economy”.

Harry Potter
  and the
Unchanging Church

 Amongst the crazier news items to captivate the hacks of what used to be Fleet Street surely the one about the Pope and Harry Potter must takes a bit of beating. In a world of widespread poverty and hunger, global pollution and the threat of a nuclear conflict, The Times saw the necessity of devoting a spread to this non-event.

 "Once condemned by the Pope for undermining the soul of Christianity, Harry Potter has been forgiven. In 2003, two years before he was elected Pope Benedict XV1, Joseph Ratzinger, then a Cardinal and head of Vatican doctrine, said J.K. Rowling's stories of the boy wizard threatened to corrupt an understanding of Christian faith among the impressionable young. ... Now however the Pope seems to have fallen under the Potter spell. The latest in the film series, Harry Potter and the Half-Blood Prince, is on general release in Britain today, and has won surprising praise from the Vatican newspaper L'Osservatore Romano" (Times, 15 July).

 The basis of the Times's surprise seems to be the changing of the unchanging church, but the history of the Roman Catholic religion is one of change to accord with the changes in the non-spititual world. Indeed the church's backflips have been many and the Times article even listed a few of them.

 Until the Second Vatican Council, in 1962-65, Catholic Mass was celebrated only in Latin. In 2003 the Church withdrew a threat to excommunicate the parents of a Nicaraguan girl aged 9 who had an abortion after being raped. 26,000 signed a petition against the move. In 2007 they abolished Limbo, a sort of halfway point between Heaven and Hell. All these recent changes are in addition to Pope John Paul II in 1992 finally admitting that the Church was in error 359 years before when they condemned Galileo for claiming that the Earth revolved around the Sun.

 In order to survive the Roman Catholic Church has had to change in line with how secular society changes. There are some unchanging tenets of their practice however – their unfaltering support of private property and their collecting dishes at church services. The Lord may provide for the gullible faithful but the clergy rely on something more tangible for their income.

R.D.
Contents
Features

  • Oil or democracy, what do you think?
    Our rulers tell us they are fighting in Iraq and Afghanistan for Democracy. Not true.


  • Japan : the road to Pearl Harbor
    No-one can even pretend that the second world war in the East was
    other than a naked clash between imperialist powers.


  • Nazism – the ultimate evil?
    Everything undertaken in the regimes called Nazi, or fascist, finds its
    parallel in the capitalism of other areas.


  • Harry Patch and the First World Slaughter
    “War is organised murder and nothing else”. “It was not worth it, it was
    not worth one let alone all the millions” (Harry Patch)


  • Imagine a world without war
    A post-conflict world.

  • Why are we waiting?
    Reflections of a man in a queue


  • As things are now
    The third part of “Then and Now – how we live and how we used to live”.
    What life might be like after socialism has been established.




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    Socialist Standard Online edition                               September 2009