Pakatan Rakyat, we are ready!

Hello,

 

Pakatan Rakyat launched its Election Manifesto for the 13th Generel Elections themed the "People's Manifesto"

 

 

View its' manifesto at Pakatan Rakyat

 

There is no turning back now despite Prime Minister Najib Razak's continued delay for the 13th General Elections. Regardless whether the elections are happening in March, April, May or June 2013, we are ready for change. Rhetorics and slogans of "stability over chaos", "1 Malaysia", "Transformation" here and there and in fact everyday, everyhour to almost everyminute on mainstream media since the dawn of Najib's administration in April 2009 has not yield any significant improvements in the country's corruption, racial and religious harmony just to name a few.

Nevertheless, thank you Prime Minister Najib Razak of leading the country in the past 4 years and now we are ready to herald into dawn of a new federal government by Pakatan Rakyat under the leadership of a new Prime Minister Anwar Ibrahim!

 

In tandem with Pakatan Rakyat's manifesto launch, I hereby post this Youtube video which was uploaded in 2008 during Anwar Ibrahim's by-election campaign in Permatang Pauh. I was ready back in 2008 but I have not be any more ready now than ever...

13th General Elections: "UMNO/BN, time is up! you get out! Let Pakatan "Harapan" Rakyat move in"

Everytime I see the majestic Prime Minister Office in Putrajaya, I am strongly inspired by the fact I have the right to change the tenant of the office!

We are ready!

 

 

What minimum wage opponents don’t get

Erna Mahyuni blogs at ernamahyuni.com when she's not subbing for TMI. A slave to Bioware, Bethesda and her mini-zoo of two cats and a rabbit.

Minimum wage law? YES or NO?

The previous article presents the minimum wage dilemma. Eventhough many middle-class and low-income group may favour a minimum wage policies, goverments of emerging economies (a.k.a. developing countries) may delay introducing a minimum wage policies due to the fact "As an emerging country, the pressure to maintain low wage policies has been considered as an unfortunate – but necessary — outcome in order to achieve low unemployment rates and steady job growth. Overseas manufacturing-based industries will automatically seek out the most efficient labour market for their plant locations. Thus, we should not misguide and sacrifice workers’ wages in a “race to the bottom” and compensate with foreign direct investment inflow. "

Goverments with no minimum wage policies (low wages policies) are often seen good on the record with low unemployment rates and up-to-expected foreign direct investment inflow. The author of the previous article posted on this blog calls for "improving infrastructure, enhancing labour productivity and labour movements, establishing better vocational training, eliminating political influence over the minimum wage avoiding drastic increases, and implementing good governance policies."

 

In my opinion, minimum wage should be implemented with the objective of eradicating hardcore poverty and cushion the effect of stagnant wages and rising cost of living. There should be a general minimum wage policy, followed by fine-tuned conditions under it. For example, a labourer may have a lower minimum wage if lodging/ accomodation and/or meals/ and/or transportation are provided by the employer, reflecting the current rising cost of living.

 

Minimum wage policy should be determined by the purchasing power of the residents of the country/ state. (United States has a federal minimum wage, and state minimum wage which the higher wage is enforced). For example, a day's minimum wage (8 to 12 working hours) must exceed the ability of the employee to pay for three descent meals and other basic cost of livings. In a more detailed manner, for a month's minimum wage, an employee is able to pay for 5kg of rice, 2kg of flour, 500gm of sugar, 20 eggs, 2 chickens, 500gm of oil, 200 liter of crude oil and have at least 70% of the wages left for access to healthcare, education, family, savings, and accomodation.

 

It would be undeniable that by enacting a minimum wage policy (in a country without that policy) will lead to a higher unemployment rate because it means a higher production cost for the employers. By setting a minimum wage policy, a goverment may provide options for employers to implement the policy or face a higher corporate tax rate, which it's higher tax revenue will be used to improve workers' skills, vocational training, productivity and quality of education.

 

Remember, enacting a minimum wage policy is not a one-off solution to hardcore poverty and curb inflation but one of the crucial steps to prevent the poor getting poorer and offer an opportunity for hard-working people to improve their standard of living.

 

In the end,

 

1) a good government must serve its people!

2) if the government cannot serve its people, then it should be changed!

3) if a government said that a minimum wage will lead to higher unemployment permanently, then it is not thinking enough! Because the growing population of a country and the world will means a higher demand for food! clothes! education! healthcare! services! Don't tell me you cannot create job opportunities on these sectors, then it should be changed!

 

In Malaysia (year of 2012), I would said an employee without food, accomodation and logistic provided by the employer must get at least RM 1000 or USD$ 320 per month (Federal mimimum wage):,

 

1) RM 300 (Food, RM 10 a day for 30 days)

2) RM 200 (Accomodation, an average room rent-rate per month)

3) RM 90 (Healthcare, insurance)

4) RM 90  (Utility bills, communication bills)

5) RM 90 (Transportation: fuel, maintenance, tickets..etc)

6) RM 120 (Clothing, shoes, savings)

7) RM 110 (Deduction for Employee's Provident Fund for retirement)

 

+ Goverment must strengthen Welfare Insituitions/ Agencies to help poor families with dependent children or elderly, after all RM 1000 is only barely liveable for a single person with no debts or family responsibilities and would still be tough for those who lives in urban areas.

 

States/ Territories (year of 2012) like Penang, Selangor, Kuala Lumpur should have a State/ Council minimum wage of RM 1200 or USD$ 385 per month.

 

MINIMUM WAGE POLICY = OBJECTIVE TO ERADICATE POVERTY + CURB THE BURDEN OF RISING COST OF LIVING

 

That's all I have to say for now :)

 

God bless us all

 

Joshua

 

The minimum wage dilemma — Iwan Ungsi.

ADAPTED FROM THE MALAYSIAN INSIDER.

FEB 15 (2012) — “Labour was the first price, the original purchase-money that was paid for all things. It was not by gold or by silver, but by labour, that all wealth of the world was originally purchased.” (Adam Smith) The recent series of labour strikes in Bekasi marked the end of the euphoria that followed the Indonesia’s achievement of investment grade. It took 14 years for Indonesia to arrive at this level, yet disputes between employers and labourers remain unabated. Invariably, these disputes are so easily predicted that the public seems to be more apathetic to the workers’ cry for their basic rights through their only weaponry: labour strikes, ranging from peaceful demonstrations at local government (or legislative council) buildings to occupying and paralysing major city roads. Equally, employers counteract with their own version and weapon of choice. Where mobility of capital is fluid in the increasingly globalised world economy, relocation could be one option to consider if businesses view profits as no longer viable due to increases in labour costs. Typically, cost-cutting exercises in organisations rely on redundancy measures, but this is no longer a workable alternative due to restrictions in the present labour regulation, established in 2003, requiring employers to pay huge severance packages to laid-off workers.

Analysing the situation at hand, both employers and workers are trapped in a zero-sum game, with each party appearing to emulate the “prisoner’s dilemma” game theory model, whereby both parties appear to choose to not cooperate even though it is in their mutual interest to do so. In this instance, the workers use strikes to halt companies’ productions with the aim to hurt the company’s bottom line, and in turn, the employers might resort to relocation in order to ensure business continuity albeit with a price. The impact of this relocation signifies unemployment for the majority of the company’s workers. In the final analysis, everybody hurts, nobody wins. Ironically, within the “prisoner’s dilemma” context, the option to choose to collude will provide a far greater benefit to each party as opposed to focusing on their own self-interests. The key to this game theory model is to establish communication between the parties and find common ground in order to seek shared perspectives. Relating to the companies and their workers, the logical win-win scenario (otherwise known as Paretto optimal solutions) would be for both parties to settle their disputes such that the workers obtain their demands of higher wages, and in theory, incentivising the laborers to achieve higher output. The first minimum wage legislation was endorsed by the New Zealand government in 1894. Since then, minimum wage laws have drawn debate all over the world.

Based on International Labour Organization (ILO) reports, 90 per cent of countries implement minimum wage laws. The UK, Australia, Netherlands, France and the US are among the countries that adopt the highest minimum wage; other countries like Singapore choose to enact foreign worker levies as a form of an implicit minimum wage (Chew Soon Beng, Business Time, 2010). In Indonesia, the term became familiar in the 1960s, but it was only introduced in late 1979.

There are two opposing views on minimum wage legislation. The first is concerned with empowering low-income workers and strengthening their bargaining position in salary negotiations amidst the widely available pool of cheap labour due to the abundance of human capital in Indonesia. Workers have no choice but to agree to unacceptably low wages where competition for jobs is stiff. Insufficient job creation to absorb the available labour force is one of the causal factors of the imbalance in the demand and supply in the labour market. On the other hand, the opposing opinion perceives the minimum wage as too limiting and inflexible, concluding that it would inevitability hurt the labour market and consequently harm the country’s international competitiveness. Most of the conflicts over minimum wages have roots in the basic premises of these two opposing views. The remaining discourse is always about labour exploitation vis-à-vis the unemployment rate. As an emerging country, the pressure to maintain low wage policies has been considered as an unfortunate – but necessary — outcome in order to achieve low unemployment rates and steady job growth. Overseas manufacturing-based industries will automatically seek out the most efficient labour market for their plant locations. Thus, we should not misguide and sacrifice workers’ wages in a “race to the bottom” and compensate with foreign direct investment inflow.

In the longer term, low-wage labour policies would not sustainably benefit the country’s competitiveness, as Carolina S. Guina (2009) argued that in the context of global competition, labour regulations and standards emerged as critical factor in attracting foreign direct investment, and low wages could result in low productivity and lower skill levels which would be disincentives for investors. We must strive to reconcile differences between employers and the labour force, seeking all possible solutions. One alternative is to emulate global best practices, which elevate the demand curve by increasing labour productivity and attracting new foreign direct investment. Hence, higher wages come in the same package as higher employment. This is no unrealistic view, as Singapore already did it in the 1980s. Following Chinese leader Deng Xiaoping’s visit in 1979, Singapore PM Lee Kuan Yew forsaw the potential of China and concluded that no country could afford to contend with China if they opened up. Hence, Lee commenced an agenda to divert Singaporeans from the low wage trap. Initial steps were taken such as reforming wage structures, mobilising macro-focused labour unions, establishing the Skill Development Fund and improving the function of the National Wage Council (Chew and Chew 2005). These steps resulted in a nation competitive edge and pushed the country to full employment.

Yet, how do we compare the situation in Singapore with a population of 5.1 million people, from which 1.4 million are foreigners, to the Indonesian context with 240 million people and a 119 million-strong labour force? Presume we multiply the difficulties 50 times, will this be settled? Unfortunately, what Lee predicted more than three decades ago has materialised now that the Chinese dragon has awakened, and currently holds the second largest economy in the world.

We should begin by improving infrastructure, enhancing labour productivity and labour movements, establishing better vocational training, eliminating political influence over the minimum wage avoiding drastic increases, and implementing good governance policies. None of these steps are achievable without tripartite collaboration, but by working together we can compete internationally. — The Jakarta Post

* The writer is a civil servant and graduate student at S. Rajaratnam School of International Studies, Nanyang Technological University, Singapore.

* This is the personal opinion of the writer or publication. The Malaysian Insider does not endorse the view unless specified.