Liam Rhodes

You’re wrong about the “unacceptable face of capitalism”, Prime Minister

You’re wrong about the “unacceptable face of capitalism”, Prime Minister

l_rhodes August 27, 2017
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We’ve heard today that the policy in the Conservative Party manifesto, namely to reduce extortionate executive pay, is to be (half) delivered.

We are now to have a name and shame policy of those firms which will be published where 20% or more of a company’s shareholders are unhappy with the level of the pay at the top of the organisation. There is little detail about how this is to be achieved, but clearly the annual vote of shareholders will not be going ahead, as announced.

The original policy was intended to enable the shareholders of companies to veto the pay levels of their chief executives. However, since her well-deserved humiliation in the June 2017 General Election, she clearly realises that she does not have the requisite number of Members of Parliament to ensure that the fully-fledged policy will be voted through; there are too many on the governing party benches who would resist such a policy – for a variety of reasons.

So, somehow soon, we will know the “unacceptable face of capitalism” via a policy which has presumably not yet been fully thought through, and indeed wouldn’t matter anyway. Here’s why: The overwhelming majority of those that hold stocks and shares in companies are principally hedge funds and pension providers. Why would either of those types of bodiesĀ care about high executive pay?

Frankly, I will be amazed if there isĀ one entity on any such name-and-shame list for that reason.

Ignoring the ethics of executive pay, there are many more pressing (and effective) ways that Mrs May could be tackling inequality or the real issues facing this country, such housing and the plethora of challenges that Millennials face with employment and education.

The level of second home ownership has risen to the highest level ever, with one in ten adults now owning one. Inequality does matter, Prime Minister, but while baby boomers are enjoying the fruits of their labour, Millennials are finding it more difficult to secure proper employment and save enough to buy their own home. Meanwhile, they rent, spending more – not less – of their money on housing costs because they have to move to find work opportunities.

The real unacceptable face of capitalism is the concentration of wealth in one demographic, to whom you continue to pander, Prime Minister. Perhaps it’s time for some bold action on housing and ensuring that children are properly educated instead.

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