Macroeconomic policy, not technology, undermines workers bargaining power

Well, a big part of the story is that the UK (like the U.S.) has a very weak labor market. This was a result of conscious policy decisions. The Conservative government put in a policy of austerity that had the effect of reducing demand in the UK and slowing the rate of job creation. In this context, of course employers get to call the shots.

Serious people would address the context which has denied workers bargaining power. It is not “technology” as Harris and his elite Trumpians would like to pretend, it is macroeconomic policy. But Harris has no time for talking about macroeconomic policy. He dismisses a plan put forward by Labor Party Leader Jeremy Corbyn to produce full employment as, “either naive or dishonest” adding “but they reflect delusions that run throughout Labour and the left.”

At the top of the list would be the policies that have favored the financial sector. Even the I.M.F. has noted that the financial sector is undertaxed relative to other industries. A modest financial transactions tax applied to the non-equity UK market would do wonders for increasing the efficiency of the sector. (The U.K. already taxes equity trades at a rate of 0.5 percent.)

We should also ask about the extent to which government granted patent and copyright monopolies are redistributing income upward. Patent monopolies are created by governments, they don’t grow out of the technology. And we should also ask whether the corporate governance structure is effectively allowing shareholders to control the pay of CEOs and other top executives. The structure clearly does not work in the case of the U.S., I suspect the problems are similar in the U.K., if not as bad.[1]

As UK Productivity Growth Falls to Zero, John Harris at the Guardian Tells Readers that Technology Is Making Old Workplace Relations Obsolete