Thursday, 17 June 2010

Of Labor and Women’s Rights in Europe

Today’s Financial Times published a joint commentary piece by the prime ministers of the UK and Sweden under the heading Reining in Europe’s deficit is just the first step. As you can infer from title, it was an economic manifesto put together “to ensure that Europe thrives and prospers”. It had “four clear steps”.

The first step was cutting back. “We have to accept that there are things we can no longer afford,” the authors said. Note the wording. First, a reference to things that we cannot afford, which everyone knows to be true. Then the “no longer”, slyly inserted; we are now talking about the things that “we” used to be able to afford but now, we have to accept, we cannot. Here, the two gentlemen of Europe are not talking about private jets. They are talking about retirees affording to live with some dignity. It is that, that “we” can no longer afford.

The second one was fixing the financial system.

Then came the third step:
The third step is creating the conditions for growth. Europe has huge advantages ... But we have deep structural problems. Productivity is shrinking. Our average growth rate is lower than the US, India and China ... So it is clear, we need deep-seated reform and we need it now. There is one area in particular where we both believe there is need for urgent change. It is shocking that in many parts of Europe women still do not have equal rights in the workplace. This is not just unfair; it makes no sense – because it deprives our economies of their full potential as workers and consumers. That is why in Brussels today we will be pushing this issue in discussion on Europe's next strategy for growth and employment.
What is this sudden, clearly out of place, reference to women’s rights in the middle of an economic manifesto?

Women in Europe are not particularly oppressed. I know of no country in Europe that discriminates against women in the workplace. And why this emphasis on women and their “full potential as workers” when tens of millions of European men are unemployed?

The answer is in the very text that gives rise to these questions. Note the concern for women’s right in the workplace is brought up in the “step” that talks about productivity. Productivity is output per labor; not labor in flesh and blood but labor as measured by wages. An enterprise producing 100 units of output with 3 laborers each earning $30 is more productive than one producing the same unit with one laborer earning $100.

Women and children have been historically used as tools for reducing the overall wages. They have less bargaining power and are more vulnerable to pressure, so they do the same work that men do, only with less wages. The result is downward pressure on all wages.

European children are protected by a variety of laws. And anyway, the manufacturing jobs, of the kind that employ children, have migrated to Asia and Latin America.

That leaves women.

One component of the “labor market overhaul” that is on the agenda of all the European governments is the reduction in wages. Women are the Trojan Horse that will be taken to the labor market to accomplish that goal. That is the source and extent of the prime ministers' interest in the women's rights. Read it. They clearly say it: By giving equal rights to women in the workplace, Europe will be able to compete with India and China!

But isn’t this plan too long-term and too complicated? Even if we assume that Cameron and Reinfeldt know of these complex relations, why would a couple of politicians care about implementing a plan which will come to fruition long after they have left the office?

The answer is that the plan is not theirs. It is given to them – and all the European prime ministers – as the policy issue to be implemented. No questions are permitted. That is why Socialists Papanderou and Zapatero, center right Sarkozy, Moderate Reinfeldt and Conservative Cameron all speak the same way. That is how you know everything is scripted at a supra-national level: politicians of different political orientations all say the same things. We are approaching the grand goal of divorcing policy decisions from politics.

As for the moral aspects of women’s rights, frankly I don't think they give a damn.