UK: START WEARING YOUR PAY WITH PRIDE PRIDE. - I sometimes wonder whether the British will ever really get the hang of this capitalism lark. Which is a bit embarrassing given that it's now well over 200 years since capitalism was first invented, or disco

Last Updated: 31 Aug 2010

I sometimes wonder whether the British will ever really get the hang of this capitalism lark. Which is a bit embarrassing given that it's now well over 200 years since capitalism was first invented, or discovered, or described, or explained - or whatever it was that Adam Smith did to it - in Britain. And what with Lady Thatcher's more recent refresher course you might, by now, have expected the British to have grasped, at least, the rudiments of the idea. Sadly this seems far from the case.

I'm thinking in particular of the chap at British Gas (£475,000 per annum), and the other one at British Telecom (£663,000 per annum) who should know better; but equally the average British middle manager (£28,000 per annum) and the average British employee (£13,600 per annum) - all seem to have real problems when it comes to handling a concept as simple as that of the pricing mechanism.

In short, just one whiff of a megabucks salary has everybody from the megabuccaneering captains of industry to the lowest galley wage-slaves all getting into an incredible stew about who works the hardest, or who works the longest hours, or in the nastiest circumstances, or who has to make the toughest decisions.

All of this is fascinating stuff, of course. But, as we all know, none of it has ever had the remotest connection with the amount of money you can squeeze out of your employer. Just like any other price, what you get paid is all to do with how much money your employer has, how much they need you and how easily they can replace you with someone cheaper - or do without you at all - if you try to push your price too high.

In other words, the whole thing should be just a straight-forward piece of capitalist economics; a shop around the market for the best prices, a haggle in the wages bazaar for the best deal, and the bargain struck at the highest price the market will bear.

And you'd think that the bosses would be proud to admit that they were doing their bit for the efficiency of the market by pushing as hard as they can for a 75% or so increase and setting an example for us all to get our snouts as deep as we can into the trough.

But not a bit of it. Not one of Britain's bosses will even admit to asking for more dosh - apparently it's forced on them by a committee of head boys and prefects - and the advice to the rest of us is that we should show restraint in our wage demands.

For goodness sake - when was restraint ever part of the price mechanism?

Well, as so often, where senior management fears to tread, it is left to Backbite to suggest a simple way in which a better understanding of the economic realities of the global marketplace can be brought home to each and everyone of us in our salary negotiations.

Quite simply, I suggest that one week of each month everybody at work should wear a name badge on which would be printed their annual salary, including bonuses, printed in a large typeface beneath their names. In addition there could be a line of gold stars to represent various perks such as feather-bedded pensions, cars and share option schemes.

Although at first sight this may seem a rather modest proposal - and would be easy and cheap to implement - I believe that such a scheme would have far-reaching consequences in developing the 'knowledgeable' and competitive marketplace described by Adam Smith. Salary badges would certainly allow people to price their own labour more realistically, and enable them to keep a natural and close watch on price developments in the marketplace. A monthly reminder of the true 'price' of organisational deadwood and incompetents might also sharpen up managerial practice - and could give an interesting edge to meetings which brought together managers of different seniority or managers from different disciplines.

Best of all, salary badges might finally get the British people to understand and use the market mechanism - the 'invisible hand' as Adam Smith described it - by which informed economic choices by individuals can come together in optimal creation of wealth and distribution of resources across society.

Well, I don't suppose the 'invisible hand' of the marketplace will ever be quite as popular with the British as the invisible hand of the National ('It could be you ...') Lottery. And, equally, I don't suppose either of them will ever get round to making me rich. But it might be worth a try.

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