Posts Tagged ‘Wage’

20 work hours per week

30 June 2012

Bertrand Russell, in his essay “In Praise of Idleness”, argues that people need more free time than job time (to busy themselves with other activities like social life and politics, strenghtening their education, working on cultural and artistic projects, and also just strolling a little) and proposes to halve ordinary work hours per week to 20 ones. The issue he does not deal with is wage. Of course, a family cannot live earning the half: both partners should work, but many already do so and the same they cannot afford monthly budget needs. Letting apart the absurdity of that, the question should be pursued (after all everyone is looking for that, looking for getting a less defatiguating job – since, even, choosing a studying youth – as a status symbol, apart from that, more than of worth or mere expression of laziness or, actually, of appreciating social life and creative working), but, of course, at least with the same quantity of that form of social slavery called “wage”. Nonetheless, at this point, questions pose about macroeconomy, bound, in fact, more to mercantilistic cannibalism than to other things. Because more money for employees means not just, of course, more money payed by ultra-super-rich (or less rich) employers (among the other things, wages represent a more or less little part for an enterprise budget – about 8%): there are also little firms, and more wage means, by itself, a higher urge to increase prices, according to the new money availability, as considered by Milton Friedman reducing the formule

[Quantity of money] x [Velocity of money circulation]

=

[Price] x [Quantity of sold goods]

to M = P x Y (or, better, according to the formulation by the Economic School of Cambridge, k x M [ x V ] = P x Y, where k is a number above zero that represents that the portion or the multiples of the money around must be considered – savings/debts – and not the simple quantity of money) [there would be another subdivision in three markets of that money circulation/prices relation: general goods, ultra-luxury items and monetary assets].

*******

Then, if people earn the double in respect how much people work, prices tend, more or less giddily, to go double, after a more or less long time period of prices increase, letting apart the part of labor force that along the path is pulled to add itself to that one already present into the space left empty by the already employed labor force. Leaving the wages per work hour unchanged, instead, the employees are deprived of half their purchasing power straightly, instead to halve just the work hours. To make the macroeconomic frame step by step settled, so, with the same wage, the work hours must be reduced gradually. Exactly along this perspective the proposals of reducing the work hours per week to 35 ones go. First step: 35 hours – exactly. Then 30 ones and then, step by step, less and even much less than 20 ones, by subsequent, gradual settlements. That is not the old story of the “another one more”: if the question would be well “lubricated”, we would ask suddenly 20 work hours per week, without leaving that languishing inside future history labyrinths. The point is, as written a little above, giving time to the system to settle and then procede to the subsequent steps, to directions even far beyond a brusque change of macroeconomic framework.

Bertrand Russell 1907

English: Portrait of Milton Friedman