Saturday, 18 June 2011

Bleat not for the politics of pension envy

Explaining economics is always fraught with difficulty, because the concept of collective good has disappeared under the dead weight of neo-liberal individualism and the "I'm all right, Jack" ignorance of those whose world-view is fuelled by the "Daily Mail" and its parochial, forelock-tugging attachment to a hierarchical pseudo-feudalism where crumbs from the rich editor's table are eagerly snapped up by the receiving orifices of his blue-rinsed acolytes.

The moral outrage that is being whipped up over public sector workers' militancy in defence of their pension rights is synthetic and cynical.  Pensions have never been static, and I don't see much evidence that the unions are denying changes to life expectancy or the need to reflect wider demographic trends.  However, they are missing a clear point that is difficult to explain to the current generation of semi-literate Cameron-worshippers, to the extent that pension is deferred salary.

Every time that a public sector employee stands up and points out that they a) entered the public service not out of a desire for short-term financial gratification and b) that most public sector salaries are set at levels that take into account lower contribution into pensions (i.e. that their take-home pay is reduced in order to boost retirement income) then this is howled down.  It doesn't fit the narrative that people's altruism is tempered by the need to feed, clothe and shelter themselves and it isn't convenient to realise that without a (dignified) pension payment on the basis of accrued services, most of the public sector's pensioners would be receiving even-less funded benefits in order to survive.

Most of the people who jump on this bandwagon are the same as those who were taken in by the "Mail's" assault on the 50% income tax band before the last election - as clearly this was kicking in at a mere 400% of the average earnings, and that this would act as a break on aspirationalism.  They go all out for private sector disciplines (much as those practised in the banking and financial services sectors) where their bosses continue not merely to draw obscene salaries but to enjoy pension benefits while they take anything meaningful away from the workforce.  These idiots combine the function of doing the government's dirty work and distracting from the real situation.

Pensions are a simple transfer payment within the national economy, but between the generations - and are part of what makes a social structure function.  The public sector has been quite effective at defending itself against the worst excesses of deregulated business, partly because the unions have remained relatively strong and partly because the market's operation would drive out people from public service if the real value of salaries erodes yet further, and will certainly not incentivise people to enter it (at all levels) in the future.  So the working-class Tory dupes are storing up potential anarchy and social breakdown with their idiotic posturings (doubtless more money for gated developments and private security firms), while the continued erosion of claims to civilisation continues.

The only truly market-driven outcome would be for the entire public realm to be privatised (from air, to public spaces through to health and education) with no universal entitlements.  Education, health, policing, sanitisation, and alll other basic needs would need to be procured through individual contracts, with clear barriers against the obvious benefits from collective action in case it replicated the hated state.  Then you could get rid of pensions as people could starve if they had insufficient savings, and therefore reduce their burden on the community.  A nasty place, but close to the "Mail" and "Express" utopia, where selfishness is promoted as a benefit to the community.

So each time you see someone attacking public sector pensions, ask why they are doing it - and why, perhaps, people are angry that their terms of employment, which include deferred income, are being torn up and ridiculed by pettifogging sharks and gangsters. 

"Which side are you on?" is becoming a pertinent question and one that is increasingly easy to answer.

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