I noted yesterday how the labour share of GDP (our national income) is falling. Here's a reason why, from the TUC this morning:
Not only have most employers given up final salary pensions, they're now paying as little as possible into defined contribution schemes.
The attack on labour rewards goes on.
Which is why we need a growth in unionisation.
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Even more worrying than this Richard is that Land and property is reported to represent 51% of this country’s wealth. That is unbelievably huge! The highest of the G7 ( Germany is about 26%, I think) I still see this as the most significant factor because it represents a locking in of wealth transference for which no-one seems to come up with a workable solution-even L.V.T introduced now is years after the horse has bolted (40 years after!).
The property/land scam is the underlying ball and chain and the elemental asphyxiator of economic well-being. And this connects with pensions as the culture of the ‘house as pension scheme’ has dominated for many years.
Thanks, Simon. I refrained from making this comment as I didn’t want to hijack another of Richard’s excellent blogs. It is true that no one is asking about the share of GDP which goes to the owners of land. But I think you are wrong to say that LVT could not fix this. It, of course, cannot take back from those who’ve already enjoyed th spoils and passed off their mortal coil, but once LVT is established with no turning back, the land market will correct land will no longer be a store of wealth rather than a factor of production.
Simon Cohen refers to:
“….the culture of the ‘house as pension scheme’ has dominated for many years…..”
And what a gigantic con that was. Just try and persuade the, now adult with a house of their own, children that ‘their’ inheritance should be converted to liquid assets to see the old folk through ’til they need only a coffin to ‘live’ in.
Home as Pension, my foot ! It just doesn’t happen. State funded elderly care is now providing inheritance guarantee for the already well off.
Benefit Street isn’t terraced it’s at least semi detached …..
Surely it shouldn’t be too hard to understand that future accrual within DB schemes were no longer affordable, given interest rates and longevity. The majority of the increased cost of such schemes has fallen on employers, not employees, leaving them less money available to for new pension contributions.
Further, employees tend to value cash ‘ wages, not money paid into a pension that they can’t access for up to 40 years, hence employers have directed remuneration in that direction.
Have you read the piece?
“Have you read the piece?”
Don’t be silly Richard. It’s all perfectly explained in the daily Mail ….week in week out.