FOR A SLIDING SCALE OF WAGES! Seeing that inflation is inherent in capitalism today, capitalists, in spite of all their

anti-inflationist airs, strive for one thing only:

while the workers pay for the costs. The attitude of the working class and its Sence it was founded m 1938, the Fourth International has defended the idea that only the shctong scale of weges constitutes a real defence of workers’ buying power against the rising cos! of wing. Ressted by both reformists and for a long time ultra leftists, this idea has nevertheless been applied by the working-class throughout the world. Examples of struggles for the sliding scale, either within single firms or branches of industry, of on 4 national trade levels, are numerous. Experrence has shown workers that the defence and protection of their buying power through use of the sliding scale represents the first land most dispensable) means of self-defence when faced wth the more and more rapid rocketing of prices The argument according to which a sliiciing scale woukt defuse the workers’ struggles. through removing the stimulus for a fight for wage increases, is contradicted by practice. Countries like Italy or Beiguum where a slicing Scale is in operation, either in whole or in part, are certainiy not places where the number of Strikes and other struggles is lower than that of countries where the workers do not yet enjoy a sliding scale. In reality, a siding scale does not act as a substitute for struggles Over wage increases. On the contrary, it creates the necessary conditions for such struggles. What is today, in the age of permanent inflation, called “a struggle for wage increases is nine times out of ten, an attempt to catch up with the rising cost of living, that is to say, it isa struggle to re-establish and not to increase the buying power of wages. When this ‘re-establishment’ becomes an automatic process, through contracts guaranteeing a sliding scale, then the struggie for real increases in Buying power can The experience of many collective contracts, in Many industries and several countries, shows that in the age of permanent and accelerating inflation, any delay in the adjustment of wages to the cost of living is synonymous with a fall LESS that the advantages of inflation fall into their strong boxes, organisations must be diametrically opposed to these persistent efforts (often successful) on the part of capital; they must aim at a complete refusal to pay for the costs of inflation, and try to protect their real wages against all its direct and indirect effects.

in the buying power of wage-earners. The Institute of Social anct Economic Studies at the very conservative University of Louvain in Belgium has calculated that Belgian workers, even through they enjoy a sliding scale, have still lost 3°. of ther buying power in the last two years. due to the fact that wage adjustments have not kept pace with the price index.

To be Sure, an automatic adjustment of wages to prices each time the latter rise above a certain threshold” level is a step in the direction of a sliding scale that mustn't be dismissed. But these measures dO not yet represent an effective sliding scale property speaking, In the first place begause any price increase lower than the threshold does not lead to any wage increases, even though it of course means a loss of buying power for wage-earners. Secondly, because it constitutes a real invitation for Governments and the bourgeois state apparatus to manipulate the official price index, keeping it just below the threshoid that would set off an automatic adjustment of wages.

A true sliding scale thus means the automatic adjustment (say each month) of money wages to all price increases, without the interference of any kind of threshold limitation. In thisway, the integrity of workers’ buying power can be preserved, as the Belgian gas and electricity workers have shown after their last wage negotiations.

Taxation and state benefits However, for this integrity to be wholly safeguarded, the effects of taxation upon workers’ buying power have also to be taken into account. At one time, the labour movement stood by the notion that indirect taxes hit poorer people more, whereas direct (income) taxes tended to hit the rich. The first part of this notion is still correct to-day but the second is less so. The growing burden of direct taxation in the last decades has above all operated through increased taxes upon wages and salaries. At present, in a lot of capitalist countries, workers not only pay majority of direct ones. evasion and fraud. increase itself. taxation.

increased by the same percentage.

by 10%.

Differentials equal pay for equal work.

other weapons have to be used.

Social allowances for most indirect taxes, they also pay the This is all the more true now that direct taxes on wages and salaries are usually paid in full by the bosses to the State, before workers themselves receive any wages, whereas taxes on capitalist profit and on the incomes of those in the so-called ‘liberal’, ‘independent’ profession are paid afterwards and without any real control. Thus thé bourgeoisie gains twice over. First by paying taxes late they benefit from the loss of buying power of currency — a fixed amount of tax on a capitalist profit paid six months after its realisation is a tax lowered by 5% if the rate of inflation is 10%. Secondly, to pay taxes without any effective control on the real profits. _ amount of profits opens the flood-gates to tax The graduated scale of tax upon wages means that each time the sliding scale causes money wages to rise to an income level that is more heavily taxed than the one beneath it, the increased tax payable is greater than the wage What interests a worker is not ‘gross wages’, a purely fictional notion, but real net wages, that is to say the total amount of goods and services which he can effectively buy with the money he gets at the end of the week. A sliding-scale must safeguard the buying power of pay actually received and must in some way offset the effects created by increased A solution demanded by the labour movement in several countries (especially Belgium) is the complete indexing of the'scales of taxation upon salaries. Each time the nominal salary is increased to make an adjustment to the rising cost of living, the tax-scale is For example, if the ceiling on wages and salaries for which a tax of 15% is paid is 25,000 Francs, it would automatically rise to 27,000 Francs, if the cost of living increased It is sometimes objected that through the use of such a common indexing of salaries, wages and taxes, the gap between the lowest and highest wages, while remaining the same proportionately continually increases in absolute figures.

Two replies can be given to this argument.

First, it is only right to limit the tax indexing to a definite ceiling, based upon the incomes of skilled workers. In the above example it could for instance be supposed that the indexing of tax-ceilings upon wages or salaries would stop at 30,000 Francs a year. Beyond this ceiling incomes would be hit even harder, thus reducing sOmew hat the gap between low and high wages.

After this, the best way of fighting the excessive gap caused by differences in income levels, is to struggle for cost-of-living allowances end of year bonuses, and for true wage increases (beyond the sliding-scale’s sphere of application)

Veto that are the same for everyone on the basis of The real struggle against excessive differences in wages and salaries cannot be waged by limiting the sphere of application of the sliding scale, but only by winning allowances and wage increases that are equal for all. it is in workers’

interests to have a simple sliding scale, simple and automatic, that will prevent them from being ground under and losing their buying power. A sliding scale serves this end, and not the fight against the inequality of incomes for which What is, on the other hand, indispensable for the protection of the whole working class against the effects of inflation (and not just workers at work) is the extension of the principle of the sliding scale for all those who receive supplementary benefits and other social allowances.

Superannuations or pensions, sick and unemployment pay, family and child allowances etc. must also be indexed and automatically adjusted to the increase in the cost of living in the same way as wages and salaries should be.

This demand is all the more necessary when smal! wage-earners on fixed incomes are the most hard-hit by the rises in prices of essential goods, and are thrown into poverty by inflation. system, Joe last year Ernest Mandel speaking on Marxism at UCD The index As soon as workers have gained a sliding scale of wages, the centre of gravity of the struggle to prevent the working class from paying the cosw of inflation shifts towards the calculation of real price rises. Everywhere, bosses and the bourgeois State try to get accepted an index of prices (or of the cost of living) established by the public administration system, as the base upon which wage adjustments can be calculated. Everywhere, experience has shown that these indexes are faked and only help bosses slow down wage adjustments, that is, to increase capitalist The means most widely used by the bourgeoisie to reach this end are: 1. The dishonest doctoring of the goods that are taken into account when calculating a cost of living index. In effect, this monthly index is an average arising out of the fluctuations in prices of a large number of goods and services. If one lets slip into the total mass of these goods a series of articles that are hardly ever consumed by workers and whose price increases are lower than the average, an index will be obtained that does not honestly reflect the real rise. in the cost of living.

Thus, the Belgain trade union movernent has for a long time denounced what it calls the ‘top-hat index’ because goods such as top-hats were taken into consideration when calculating the cost of living index.

The same type of dishonest manipulation can be seen in the exclusion from any cost of living index of services whose costs increase particularly fast — e.g. in some countries, rent and medical charges not subsidised by social Security;— orto include them but to give them less weight than they actually have in household budgets. 2. The dishonest selection of real prices. In capitalist society the same articles are often sold at widely divergent prices; this is especially so for foodstuffs. To continually select the prices of such goods in places where working class housewives do not on the whole do their shopping (e.g. in markets) produces a price-index which has very little todowith the actual expenditure of working class households. 3. The manipulation of the over-all outcome of the index through holding back the price of certain articles. This is known in Belgium as ‘the politics of the index’ and is only profitabJe for bosses and the bourgeois State if there are thresholds beneath which no wage adjustments can take place. If this threshold is fixed at 2%, for example, a government can, by arbitrarily blocking the price of certain widely consumed goods (e.g. bread), artificially maintain the index at 1.9% or 1.8%, thereby creating for some months a loss of buying power on the part of workers of up to 2%.

This fiddling of the index is so blatant in countries such as Italy or France, that functionaries from the various Institutes of Statistics have even denounced it themselves, and have offered trade unions their help in calculating an ‘honest’ index.

In Belgium, the unions have won the right to véto any officially recognised index. Sitting on a ‘price commission’ next to the bosses and the government's representatives, they can refuse to recognise as valid the index published each month by the government, But this ‘suspending’ véto has a purely propagandistic value, as it does not;mean that the increase in salaries that a moré honést index would produce are automatically obtained.

Trade union calculations of the monthly level of prices shouldn't be carried out in the shadows of offices, even if they are union offices.

information on prices should be collected by teams of housewives and workers, in the shops, through price contro! committees. This information should be publicly discussed and debated before the working masses. To associate the mass of workers now with the application of the sliding scale is to ensure later the widest based work ing class democracy and the real self-organisation of workers when they have won political power and overthrown the capitalist

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