This article by Jeremy Warner in the Telegraph is disturbing on two counts. His erroneous argument is a distraction from what’s really wrong with our economy, and it has stirred up a foul nest of malcontents (see the comments below the article) who appear to blame immigrants for everything that’s wrong with our society.
Jeremy says that the availability of cheap migrant labour in the UK is partly responsible for persistently low productivity, basing his argument on the theory that cheap labour discourages investment in stuff that improves productivity (machinery, for example), which sounds plausible enough until you stop and think.
For starters, I’m struggling to find evidence that the wages of workers who weren’t born in the UK are significantly lower than those of UK-born workers. There is, however, plenty evidence that all wages and salaries for UK workers are lower than they’ve been for decades when compared with the cost of living.
So we have cheap labour across the board, which might discourage investment in productivity, but the lack of money flowing around the economy is a much more likely culprit. Our sclerotic banking system combined with individuals and companies sitting on gargantuan hoards of stagnant money can certainly be blamed for the lack of investment in our economy. If all that money was spent on machinery and wages productivity and would go up and everyone who wanted one would be in a well-paid job.
So what about all these immigrants, then? Well, let’s imagine that we stopped allowing anyone to migrate into the UK in 1983 when the population was 56 million, and started a campaign to increase the perilously low birth rate. Thirty years later, after great success in breeding our own, imagine we have 7 million extra people all of whom were born in the UK. Which of these true Brits do we blame for low wages and low productivity? Who is stealing jobs from whom?
The idea that migrant workers are an economic problem is ridiculous. More people is only a problem if we don’t have the resources to feed and house them. The truth is that our planet that is more than capable of sustaining all of us, and the UK has always been very good at capturing more than its fair share of the earth’s bounty. There is plenty of stuff for everyone in the UK regardless of where they were when they emerged from their mother’s womb.
More people, especially people of working age, means more people wanting to buy stuff and more people who are able to produce stuff that people want, which is what an economy needs if it’s going to thrive. Our economy isn’t failing because we have more people in it. The failure is due entirely to how we manage the distribution of resources, and the root of this failure is our misuse of money.
Our systems are so badly designed that the majority of us are constantly in fear of losing the precarious income that pays for our survival and comfort. Fear breeds resentment of those who we think are undeserving: the rich, the afflicted, the feckless, and the foreign.
Jeremy’s mistaken analysis of the problem feeds this resentment, encouraging people to blame the foreigners, giving some pseudo-intellectual licence to what is little more than poisonous nationalism.
If Jeremy, the Telegraph, and their readers really want to make Britain great then they should be attacking the ignorance of politicians, the arrogance of orthodox economists, and the indolence of mainstream journalists. They are the ones who haven’t taken the time to understand how money actually works and why our misuse of it is slowly driving our economy off a cliff.
If we concentrate on what’s really wrong with the country we might have a chance of fixing it. Stoking resentment of immigrants/scroungers/billionaires is a distraction that we don’t need.