The global market is good news for the skilled, the active, the energetic and the ambitious. It is often seen as a threat by others, who fear it means no job or a low paid job. After all, the other side of access to the world’s better off as a much larger market, is access to the world’s lower paid as a potential workforce.
In the UK there has been a paradox. The same people who welcome access to ever cheaper and better value products from China, India, Malaysia and Korea complain that UK wages are too low and that too many new migrants are being allowed into the Uk to undertake work at modest pay levels. The very same people who are paying the poor wages of the Chinese or Thai factory worker when they buy the foreign product, recommend a higher living wage or bigger benefit top ups here at home for the jobs that remain. They are not prepared to pay the UK workers higher wages themselves by buying the UK product if it is dearer.
It leaves us with a problem. Of course all UK elected politicians want people here to have well paid jobs. If you could do that by legislating for a high living wage, Labour would have done it when in office. They did not do so, opting instead for a minimum wage which is a low wage by western standards, because they feared that a higher level would simply destroy more jobs in the UK, exporting the opportunity to lower wage countries. Like the Conservatives before them, they embarked on a programme of taxpayer financed add ons to low pay, so that those in lower paid employment had a better income through benefit and tax credit top up.
The long term solution to the problem favoured by most political parties is better education and training, so more people in the UK have the skills and qualifications necessary to command higher wages in the world market. If we want to enjoy living standards more like bankers or lawyers, then more of us have to have skills and offer services as valuable to the world market as lawyers and bankers. We need to accept that this can only be a partial answer, as there will remain people who cannot achieve the level of skill and enterprise necessary to command high wages.
In the shorter term the Coalition like the previous government will seek to find the best blend of income top up and minimum wage to provide a minimum income that offers the many participation in the success of the fast moving global economy. That requires tolerating the rich and successful in our country, and welcoming more to us. The way to earn higher wages is to work well for someone or some company who is rich enough to pay you well. The London economy benefits from the concentration of wealthy foreigners who now occupy much of the best central London housing. The other model, of relying on ever higher taxes on the rich and successful to pay more out in benefits for those who cannot find decent jobs , will in the end be self defeating. The rich leave, as Mr Hollande is discovering. Far from paying more, they pay less, leaving the country unable to afford such a generous welfare system.