2020s >> 2020 >> no-1389-may-2020

Cooking the Books I: Social distancing and the wages system

Social distancing and the wages system

Faced with the spread of a highly infectious disease, the obvious immediate response is to encourage social distancing so that fewer people catch it. Should such an epidemic occur in socialism, as it could to, that would be the initial response too.

But today we are living under capitalism where social distancing, insofar as it involves people not going out to work at non-essential jobs, creates a serious problem. It is not so much the work not being done as the fact that most people depend on working for an employer to get the money they need to buy the things they must have to live.

This arises from the nature of capitalism as a class-divided society where goods and services are produced for sale with a view to profit. The means of living – the places where wealth is produced – are owned and controlled by a small section of society only; the excluded majority have to get money in one way or another to survive. They can beg or they can steal, but most do so by working. Some are self-employed selling a service direct to the consumer. The vast majority, however, get money by selling their mental and physical energies to an employer.

The effect on people of not allowing them to work can easily be worked out – they no longer have a money income and so can no longer access what they need. In these circumstances the government has no choice (unless, that is, it wants to provoke riots and rebellion) but to provide them with some money. In Britain the method chosen has been to give employers a grant to pay employees who they have had to send home on unpaid leave.

Some legal draftsman searched through ancient documents and found the word ‘furlough’ to describe this. Under the scheme employers are to be paid a grant of 80 percent of the labour costs of each worker they ‘furlough’, enabling their workers to get 80 percent of their previous earnings. Much better than nothing even though a drastic cut in their standard of living but enough to allow them to social distance; which is in effect what they are being paid to do.

Even so, well over a million extra workers have been reduced to applying for the welfare handout known as Universal Credit. The government even instructed local councils to find housing for the street homeless so as to get them out of circulation.

All this has involved the government spending huge amounts of money, which it will get by borrowing, some it seems from itself. The latter is in fact the equivalent of printing new money and would eventually have the same upward effect on prices as over-issuing money always does. The government is hoping that having to do all this will only be temporary and of course they cannot go on indefinitely paying workers to do nothing.

How much simpler things would have been if we were living in socialism where people’s access to what they need wouldn’t be linked to working for a wage. If ever social distancing should be needed in socialism, not being able to associate with other people would be inconvenient and difficult for the social animals that humans are, but not made worse by worry about how to get the things needed to live. Every member of society would have direct, free access to this as of right.