Parental Conflict

by Roland Watson

Necessity is the mother of invention and the Free Market is the father of its realisation. By the fruitful union of these two parents have many a successful idea and business been sired and will continue to do so.

Humans have been most successful at procreating as well with over six billion alive at the last count. Therein lies a conflict of parental rights. The free market wants its children to grow healthy, strong and competitive and we wish the same for our progeny.

Against this backdrop, the Chancellor of the Exchequer, Gordon Brown, has now made it mandatory for companies to provide two weeks paternity leave for new fathers. This follows on from the introduction of maternity leave some years back. A nice little vote winner, no doubt, but the State proves once again that it is no friend of small and medium sized businesses.

Back in April 1999, the Labour government imposed the minimum wage of up to £3.60 on businesses. This meant an average of 30% pay rises for about 2 million workers in the United Kingdom and was a forced piece of wealth redistribution that led to the predictable rises in redundancies and cuts in reinvestment (or the drop from Jaguar to Ford for the "oppressive" owner as some socialists would have us believe).

Ironically, thanks to free market dynamics, there had been a de facto minimum wage in place for years. To be more precise, the going rate for State welfare payments ensured that no one would work for less or pay less when they could get it for nothing off the backs of more productive taxpayers. So we see that one error leads to another as the politics of guilt and envy votes the money out of the pocket of the productive into the pockets of the idle and unmotivated (excluding those who cannot work through no fault of their own). Welfare needs to be reprivatised and put back into the domain of uncoerced compassion which is freely given.

Tommy Sheridan of the inconsequential Scottish Socialist Party wanted £7 an hour and was laughed out of the Moderate Socialist Court for even they knew the devastating effect on the economy of such a wage hike (not to mention the murmurings of the more qualified who are already on such a rate). Some Utopians still live and breath in that discredited camp.

Back to babies. The government has a love affair with them which now goes beyond kissing them during electioneering as the new paternity obligation so amply demonstrates. But it means more paperwork, more cost and more disruption for small companies with limited staffing levels. It was bad enough for these newly born companies to be fed the diluted milk of maternity leave and the crumbs of the minimum wage but paternity rights leaves the smell of a soiled nappy in dire need of a change.

The statistics are plain enough. There are 233,000 small and medium sized companies in Scotland employing over 60% of the workforce. They are the lifeblood and future of the economy who wait like small mammals ready to take over from the bloated and tired dinosaurs of big business with fresh ideas and vigour.

Government red tape threatens to strangle many of the newly formed companies at birth and lead to a backlash as start up bankruptcy rates lead to fewer jobs, lower pay and reduced tax revenues. In fact, the number of new businesses created in Scotland is down 16% compared to 1999 (the first minimum wage year).

I think the maternal metaphors have been exhausted – but not the moral and economic argument. Who is responsible for the welfare of children? The parents, of course. We have too many surrogate parents in the willing form of the State and in the unwilling form of small businesses.

But the problem goes beyond that in how such a short-term economic fix actually impacts long-term economic growth. The free market needs two things to prosper an economy. It needs productive people working in productive teams competing against other productive groups. It also needs honest (i.e. socially skilled) people who honour contracts and do not defraud their customers.

There are enough studies to suggest that the cognitive and psychological development of children is proportional to the time spent with their mothers. It has been shown that children of absent mothers lag behind in exam results and are more dysfunctional in social skills. This coming drop in raw skills will undoubtedly impact progress; but by how much is unknown. Furthermore, we can expect it to be compounded as dysfunctional children become dysfunctional parents.

To be frank, the influx of women into the workplace does not increase the average skill rating of the entire workforce – it stays the same and that is nothing more than an equality argument. A democracy has the freedom to choose whether to implement short-term economic equality at the expense of long-term economic prosperity. But what the eye does not see in 30 years, the heart does not grieve after in 30 years. We too often judge results by what we currently have in our wallets as opposed to what it could have been.

Before us lies the twin pronged threat to our future economy as the smallest children of both the free market and working parents combine to form two sets of offspring less well-equipped for their respective societies than their forebears.

It’s enough to make you throw a tantrum.