A Question for the West of England Partnership
By Redland Kumon Centre | Monday, November 01, 2010, 09:27
I have some concerns about the new West of England Partnership, which will come into being next year, replacing the Regional Development Agency, which has been axed.
As a local business owner in Redland, here's an initial observation and question:
Why is the Partnership's 2026 vision statement
so focused on supporting the employer-employee model of job creation?
Consider its opening statement, which describes the greater Bristol area
in 16 years' time as:
"One of Europe’s fastest growing and most prosperous sub regions which has closed the gap between disadvantaged and other communities – driven by
major developments in employment and government backed infrastructure improvements in South Bristol and North Somerset."
Apparently,
the author(s) believe that by (a) improving roads, trains and the
airport, and by (b) "major improvements" in employment, the social and
economic gap between rich and poor in Bristol will reduce.
That
is an astonishing claim. It rests on an employer-centred model of
economic development, seeing the presence of companies that pay wages to
employees (along with good transport systems) as a major contributor to
economic equality.
History,
however, tells a rather different story. In a globalised economy, four
things things tend to happen to successful companies.
- Firstly,
they are floated on the stock market, becoming essentially focused on
generating profits for share holders, however that can be legally
achieved;
- Secondly, the wage levels between the senior managers and the lowest-paid workers tend to increase;
- Thirdly, they tend to get taken over by larger competitors;
- Fourthly, they tend to outsource their production to countries with cheaper labour markets
This
is exactly what happened, of course, to the Cadbury's chocolate factory
at Keynsham, where as I write, the last of the 500 workers to lose
their jobs will be facing unemployment as production is moved by new
American owners Kraft to Poland and elsewhere.
This job-cutting
announcement, it should not be forgotten, was made one week after the
takeover by Kraft and following assurances that the factory would be
kept open.
Clearly, the
interests of global firms, who increasingly operate alongside or beyond
the effective control of national governments (witness
the large number of "British" companies that are registered in
Switzerland, to avoid business tax in the UK) are not the same as the
interests of individual workers from Bristol whose livelihoods can be
taken away at a moment by executive boards meeting in New York, Shanghai
or Dubai.
It's worth
noting as well that the improved transport infrastructure that the West
of England Partnership advocates is, indeed, a core element in
successful business - though not in the way that I suspect the Partners
envisage.
Kevin Carson argues
(convincingly, in my view) that the costs of major transport and
communication infrastructure that facilitated the creation of a national
market for goods in the nineteenth century were paid for by taxpayers
but disproportionately benefited corporations. Although I haven't seen
any raw data for the twenty-first century, I assume that similar forces are at work in
the formation of global markets.
Of
course, the gap between rich and poor certainly needs closing - it has
widened significantly in Britain over the last thirty years. There is an
alternative way of working towards this aim, however, which does not
place us at the mercy of global corporations.
The
Distributist economic model argues for a settlement in which the vast
majority of individuals own their own means of production, either as
self-employed small businesses, or as members of worker-owned
cooperatives. As one report noted on the subject:
"Employee-owned firms have outperformed the FTSE-All Share Index over the last 18 years by an average of 10%.
When shares are distributed to all employees we see a minimum 5%c productivity gain and often more, according to research."
There's
no inherent reason why such an economic model could or should not be
implemented at the heart of sustainable development of the Bristol
region. All that needs to happen is for the rules to change.
I've written previously about Distributism here.
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