Social-ism in pay deals
The Labour government is advocating Fair Pay Agreements (FPAs) to raise wages. There’s opposition despite the fact that our economy, one of the world’s best, can’t seem to generate living-wage compensation and worker happiness for a lot of people working 36-40 hours a week. This shortfall is probably a result of most wages not being determined in truly free markets. Rather, most workers negotiate individually, not collectively, with companies that have more power than they do. Corporations and conservatives suggest that we have “freely competitive” wage determination. Why fix it if it ain’t broke? they ask. They argue that free markets fairly allocate compensation to each person according to their contribution to production. Market-determined wages are therefore “just” or “fair”. But an ironclad requirement for this is that each firm operating in…