For the financial year 2013-14 the Vice Chancellor of Bath Spa University, my employer, received a salary of £256,000. This represented an increase of 18.5% from 2012-13. In the same year she received contributions to her pension fund of £43,000, which is more than my salary, and will allow to her retire on an annual pension far in excess of anything the rest of us could ever earn. She also spent £42,000 of the universities money on expenses, which is again more than my salary. So on top of her salary of £5,000 a week she also received or spent, another £1,635 A WEEK. Bath Spa is not a Living Wage employer and the rest of the staff had a pay increase of 1% over the same time period and a 15% cut since 2010 if inflation is taken into account. What the hell is going on? How can any individual be ‘worth’ such vast sums? Does a VC work harder than the rest of us? Are these men and women so uniquely clever that they deserve such grotesquely inflated remuneration packages?
If you are very wealthy and want to stay very wealthy, it is in your interests to increase the profitability of companies you own and to reduce your tax bill. Thus the ‘austerity’ agenda and turbo-charged neoliberal capitalism come together to serve the interests of the wealthiest. The ‘austerity’ agenda to drastically reduce public spendingis not separate from neoliberal capitalism, it is part of the neoliberal package.
Right-wingers, especially in the USA, theorise taxation as a form of theft. ‘I own what I own and it is wrong of anyone, including the government, to take any of what I own from me,’ they might say. Then those of us on the Left might reply, ‘Well, you only exist as part of a society and you only own what you own partly because of the infrastructure and institutions that existed prior to you and the work of others directly employed by you but also others not directly related to your enterprise, and that therefore it is only right that those others and society in general share in that wealth.’
Now, we can argue about whether Richard Branson say, or Alan Sugar, ‘deserve’ their obscene fortunes, about the role of luck and coincidental timing played in their success, and about the role of the ‘heroic’ individual in econmic change, but whatever we say about that, we can say for sure that the vast majority of these CEO’s are not ‘heroic individuals’, on the contrary most of them are salaried, corporate technocratic and bureaucratic managers who have never taken a personal ‘risk’ in their lives and have spent a lifetime climbing the greasy pole.
You can also argue the toss about who creates wealth and at which point in the production cycle it is created, but the reality is that for the vast majority of us, including the middle-classes, a progressive tax regime that provides healthcare, education, welfare and even, God forbid, arts provision, from collective funds raised through tax, is a much, much, better deal than an entirely free market that by it’s nature creates insecurity, low pay and constant flux. For the majority of us security of employment and high quality public services are far, far more valuable than low taxes and high profitability
I would argue that this is why the remuneration of CEO’s (including university VC’s) across both the private and public sectors of the economy, have rocketed in the last 20-30 years. These men and women are being rewarded for managing the process of delivering higher profits AND lower taxes, BUT to do so without industrial strife. They are tasked with ‘getting more for less, and with as little trouble as possible,’ which inevitably means undermining collective worker power, charging ‘customers’ more (students in the case of a university) and reducing the pay and conditions of staff in order to reduce costs. This applies just as much to public services as to private businesses because of the elite wish to increase profitability AND reduce taxes. It also illustrates why the media is such an important player in the neoliberal project because the control and manipulation of information and ideas is crucial in bringing about economic and social changes that are so manifestly not in the interests of the vast majority.
But by paying these technocrats and bureacrats such vast sums the system actually makes them part of this wealthy elite and as a result the dual aims of increasing profitability and reducing public spending, become aims that are in their own direct interests, not simply as abstract, theoretical ‘goods’ as proposed by econmic savants like Ayn Rand and Milton Friedman, but ‘goods’ that reflect directly in the technocrats bank balances.
So these men and women, whether in private business or public services, are given these obscene rewards to allow them access to, or maintain their membership of, the ruling class, and thus incentivise them to deliberately and consciously reduce the pay and conditions of everyone else in order to increase the wealth, status and privilege of the ruling class… that in turn they become part of by fulfilling these tasks.
And so it is that a bureaucratic (technocratic at best) manager of a not-for-profit public institution can be awarded a remuneration package that is simply beyond the imagination of most of us. I don’t know about you but this makes me very, very angry!