Posts Tagged ‘Stephany-Griffith-Jones’

Sunday review on Wednesday: the Great Rebalancing, by the Fabian Society

02/01/2013, 07:00:26 AM

by Jonathan Todd

Heavy words are lightly thrown in the Great Rebalancing, the Fabian Society’s new collection of essays on the economy. Three telling examples are “change the rules of the game”, “a mainstream north European economy” and “market failure”. The different interpretations that might be made of these largely undefined terms go to the heart of Labour’s dilemmas.

Twice in Stewart Wood’s relatively short introduction he refers to “changing the rules of the game”. This may tell us that he is putting these words into Ed Miliband’s mouth but I remain unclear as to what exactly is meant.

Does it mean legal and/or regulatory rules, some market intervention to change the dynamics of competition and thus the rules of the market, or the rules formed by cultural and social norms?

Should, for example, the living wage be a legal right for employees, something that is incentivised for employers by tax or other mechanisms, or something that it is considered culturally unacceptable not to respect?

Wood cites Jacob Hacker’s definition of predistribution: “a more equal distribution of economic power and rewards even before government collects taxes or pays out benefits”. Given that this would not seem to extend to incentivising the living wage through tax breaks for employers, predistribution routes to a living wage would seem to encompass enforcing it as a legal right or seeking to make it a cultural norm. The former comes with more risk of pricing workers out of employment and the later is less likely to effectively secure the living wage.


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