Tory assault on Children

[Young Master Smeet]

http://www.bbc.co.uk/news/uk-politics-33089711

I think this is the key phrase:

Quote:

Government sources said it would represent a cutting of the system of tax credits put in place by former prime minister Gordon Brown, which they believe "papered over" poverty in the UK rather than seeking to address its "root causes".

MPs and experts close to Mr Osborne believe reducing current tax credits would see low-income households encouraged to take on more work to keep their family income up.

and of course:

Quote:

He added: "What I would like to see is the burden moved away from the taxpayer and from the state towards some big profitable employers.

"The point is you have a lot of employers who are basically getting subsidy from the state for low paid work and we'd like to see a shift towards those employers who can afford to pay the living wage to pay the living wage.

Grist, again, for our redistribution of poverty argument, but here capitalists are attacking each other, and wanting to drive down wages by threatening to starve our children.

[james19]

According to the Independent, this is a broken promise! Tories consider cutting tax credits for working families despite election promise not to http://www.independent.co.uk/news/uk/politics/tories-consider-cutting-tax-credits-for-working-families-despite-election-promise-not-to-10312123.html

[SocialistPunk]

I haven't been paying attention to the news recently, but on return to the land of the living, I'm not surprised to find this plot unfolding. Governments always get the really nasty stuff, they've been planning, in as early after an election as possible. I suppose in five years time, come the next general election, the electorate will have forgotten Cameron's pre election dismissal of tax credit cuts.

Quote:

BBC Newsnight says allies of the Chancellor George Osborne are examining the plans, which they believe would increase “work incentives”.

Quote:

Political allies of Mr Osborne say the move would increase incentives to work.

Notice once more, the use of a familiar tactic of suggesting benefit payments only encourage the "work shy". So if you're a "working family" with wages above the tax credit level, you're encouraged to see those in receipt of tax credits as lazy, undeserving, scroungers. A drain on society.Tory social Darwinism once more on display. Same old story.

[ALB]

Further admission in the Times today that "tax credits" are a subsidy to low-wage employers.  In her opinion column Rachel Sylvester quotes "an ally of the work and pensions secretary" (Ian Duncan Smith) as saying:

Quote:

You’ve got some big businesses that are making huge profits but paying their workers poverty wages. They get away with it because workers are supplemented by the tax credit system but why should ordinary taxpayers subsidise these companies?

She reports that, unlike Buffett, Duncan Smith wants to increase the minimum wage instead, so shifting the burden of paying for the working poor from the state to employers.This is a dispute within pro-capitalist circles as to how to deal with the problem of workers unable to sell their low quality labour-power for a so-called ‘living wage’. Does the state try to make employers pay them a living wage? Or does it top up the low wages which are only what employers are prepared to pay? Or again, does it simply pay them ‘welfare’ for not working?In the end, as with many political issues, it comes down to which section of the capitalist class should bear ‘the burden’.

[alanjjohnstone]

The argument has been going on in the US for quite some time about the State subsidising the Walmarts and the McDonalds low wage structure.The difference being between the UK and the UK is that the debate is centred around th $15 minimum wage demand being pushed by the Left. So it is interesting that IDS and Kshama Sawant are singing from the same hymn book and are in general agreement.  Also i would add "In the end as with many economic issues it comes down" to who has the strength and fortitude to combat more in the class struggle over wage levels because the cuts in tax-credits will have to be recouped by higher wages extracted from employers by their employees. Pay rises to compensate for lower net pay does not necessarily mean it will automatically happen…unions will have to fight for it…Or workers will have to submit to lower standard of living. No doubt we will see some form of divisive propaganda used by the bosses…the needs of work colleagues who have kids being played off against the young singles…another generational divide and rule perhaps….i recall when i entered employement long ago, pay incremental age scales were the norm in many jobs…perhaps we will witness its return…

[ALB]

Here's Buffett's take on the idea of a $15 an hour minumum wage in his 21 May article "Better than Raising the Minimum Wage" in the Wall Street Journal:

Quote:

I may wish to have all jobs pay at least $15 an hour. But that minumum would almost certainly reduce employment in a major way, crushing many workers possessing only basic skills. Smaller increases, though obviously welcome, will still leave many hardworking Americans mired in poverty. The better answer is a major and carefully crafted expansion of the Earned Income Credit (EITC), which currently goes to millions of low-income workers.

In other words, subsidise their wages, tax the rest of the capitalist class for the benefit of those paying the below poverty line wages. Which is what Cameron, Osborne and Duncan Smith seem to be worried about.What I think he is saying about a high minumum wage is that this would mean that workers whose labour-power is worth less than $15 an hour wouldn't be able to get a job.It looks as if there's no way out  for the capitalist class as well as for the working class.

[alanjjohnstone]

"It looks as if there's no way out  for the capitalist class as well as for the working class."Again i think it depends upon the capacity of the working class to be willing to resist. If they don't, the way out for the capitalist class is simply to keep on driving workers into the ground, lowering wages and cutting benefits, having it both ways…increased share of surplus value from more expoitation and less taxation. Some talk of no return to the 30s, much less further back to the 19th C but is that actually a prospect that may well occur if the unions and workers don't start drwing their red lines  and saying "no more…enough is enough"…If we are not able to fight back and lack the confidence to do so…how far can workers be made to suffer the burden? What are the limits we are willing to accept before fighting back…even at a cost to ourselves in the short-term.The Tories are determined to de-fang the unions, what if they succeed and then choose to emasculate them even more…will workers strike illegally and will the unions bear the consequencies of sequestration? Buffet is well known for his quote…there is a class war and our side is winning…isn't that the fact of the matter…despite the rhetoric the employers have grown even stronger, and have not met any real challenge yet for i think Marx talks about classes weighing up their power until only actual battle decides who is the stronger.. ..something like that, anyhow…I am full of despondency when i see the calibre of union chiefs like Len McCluskey etc…Another fear is that we will have again a divergence of militantism regionally…the STUC appear much more ready, (or at least publically say they are) to defy the government and the law of the land..adds fuel to this separatist curse we Scots have at the moment. 

[Young Master Smeet]

http://www.chroniclelive.co.uk/news/north-east-news/tax-credit-cuts-hit-north-9514175

Quote:

It is reportedly being considered that they will be cut back to the 2003 level, which the Institute for Fiscal Studies has calculated would reduce entitlements for about 3.7m low-income families with children by an average of £1,400 a year, reducing spending by about £5bn.Labour says that 148,000 North East families – or 56% of the total – benefit from tax credits.ADVERTISING House of Commons figures also show that 70% per cent of those claiming them in the region are in work.[…]Figures reveal that 62% of children in poverty live in homes where at least one adult works in a part-time or insecure job with low pay rates that are boosted by these tax credits.

Obviously, part of the idea of tax credits was to target child poverty, and the costs of raising a new generation of workers directly, and avoid giving money to childless workers unnecessarily.  This could well cause a rise in general wages, but to the benefit of the childless.

[ALB]

Boris enters the fray:http://www.dailymail.co.uk/news/article-3137332/Boris-warns-Cameron-Osborne-against-hacking-tax-credits-firms-start-paying-workers-more.html

Quote:

Five of the country's biggest retailers – Tesco, Asda, Sainsbury's, Morrison's and Next – reportedly receive £1billion-a-year in taxpayer-funded subsidies for their wages bill.Ministers hope that a move to cut tax credits, potentially back to levels last seen more than a decade ago, will put pressure on firms to increase wages.But it will not have an immediate impact on the incomes of people who rely on the money, sparking concern among campaigners.Speaking last night, Mr Johnson said the government should 'certainly be cutting welfare' but warned against hitting working families on low pay.He said: 'Before we start hacking back on people's in-work benefits we've got to look at the low pay from corporations that could be coughing up much, much more to help them.'

Sounds like a cue for the trade unions to step in to try to get the low-paying firms to cough up the more than Boris says they can. They certainly won't pay up just because the government says they could nor just to reduce the tax burden on the rest of the capitalism class.What all this shows, of course, is the continuing relevance of the socialist call to abolish the wages system. 

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