Back to the future
Never doubt that the forces against economic fairness for working people are powerful, influential and global.
Case in point: the World Bank, which defines itself as providing economic development assistance (in other words loans) to low and middle-income countries, has missed the memo on inequality.
The bank also says it is concerned with eliminating extreme poverty and boosting shared prosperity, but a yet-tobe released major report from the bank appears to have completely missed how prosperity gets shared.
Instead it is advocating for lower wages and fewer workplace protections.
Where have we heard that before?
The World Bank Development report, obtained by The Guardian newspaper, appears to lay out a stunning and profoundly flawed roadmap that would deepen inequality and punish working people in developing countries.
The short of it is: workers must bear the full brunt of the automation revolution that, according to some predictions, will eliminate millions of jobs.
Corporations have been given a free pass and free rein to do as they wish which, of course, is usually the case. It’s a race-tothe-bottom formula wrapped up in modern-day threats about automation.
The report calls for the elimination of minimum wages and laws that limit abusive employment contracts, and to giving employers and global corporations the right to fire workers without just cause. It recommends less “burdensome” laws and regulations (those ones that protect workers) and cheaper labour.
That’s right. According to the World Bank, lower-waged and insecure work is the answer.
Using impending automation as its excuse, the bank has resorted to age-old and failed prescriptions.
Lower your standards and your wages or lose your jobs. Ignored are some of the more innovative solutions, including using taxation as a means to capture some of the wealth created through automation and in turn use it to make sound economic investments and transitioning for workers.
Other proposals include a shorter work week and taxing the robots. Consider what a disaster lower wages will be for the global economy which has been slumping along.
Indeed, many economists are talking about things like inclusive growth and higher wages.
The World Bank? It missed those memos, too.
For global capital and the 1%, this World Bank race-tothe-bottom prescription has been the corner piece of vulture capitalism since the days of the feudal system.
The World Bank must be called out for its thinly guised arguments which pretend to give a fig for workers, when the proposals would actually drag workers backwards in places of the world where they can least afford it.
And don’t think for one second that these proposals to address automation will remain within the borders of developing countries. They will worm their way into economic thinking and policy in developed countries as well. I can just imagine the report from the Fraser Institute and the warm embrace this nastiness will get from some politicians.
What cave has the World Bank been living in?
It has also completely missed the memo on inequality and stagnating wages. And what of human rights and workers’ rights? Pesky things, I know, for some, including the World Bank.
The proposals are like something out of the 1%’s dream list and are freakishly out-ofstep with current thinking and recommendations from other global institutions like the IMF and the OECD who have been promoting a more — dare I say — worker-friendly agenda as of late.
They have both addressed the need to improve worker protections and close the gender pay gap as a way to boost economic growth.
Using the World Bank’s reasoning, everyone should just start working for free and somehow this will stop the predicted automation revolution. It’s so silly it’s almost not worth discussing except this global institution that loans money to developing countries can influence governments to implement these dangerous policy directives.
Indeed, many of the proposals like deregulated labour markets and extremely low minimum wages, an attack on unions and fewer rights for workers are not unlike those posed in the 1980s and 1990s and which were embraced by governments around the planet. The result: a world grappling with such inequality and concentration of corporate power and wealth where changing course is getting tougher and tougher every year.
In my last column, I noted a report by the U.K. Library which states that by 2030 the 1% will own two-thirds of the world’s wealth.
A World Bank spokesman told The Guardian: “The report will present a range of ideas for how governments can create the conditions for workers to benefit from huge shifts in technology, demographics, urbanization and other factors.”
What a load of doublespeak! And the bank representative further said: “To end poverty and boost shared prosperity, it’s vital that we consider new initiatives to meet the disruption that will surely come from these structural changes. We encourage and look forward to comments and an evidence-driven discussion on this important topic.”
We need to remind the World Bank that their idea of “new initiatives” look a lot like the economic rules of the past, that left workers behind.
It’s called trickle-down economics and if the bank came out of its cave it might realize those theories have been soundly thrashed with “evidence.”