Sunday, 30 November 2014

The 123 of Labour Exploitation

“But it [GDP] is not sufficient and it is not enough because it does not account for externalities. It does not account for the value of some cultural goods. It does not account for the damage that we do to the environment, which is why I believe, personally, that… we need to combine alternative systems that take into account those externalities, those not-accounted-for goods that have no tradeable values and yet that have a very significant value.”

IMF chief Christine Lagarde, 20 February 2014, ABC TV Q&A

“Which is better for a country’s well-being: $10 million spent constructing a jail, or $10 million spent producing a line of smartphones? How about clear-cutting rain forests to produce $10 million in lumber? Or a storm that requires $10 million in repairs?... Using today’s most common shorthand of national welfare, gross domestic product [GDP], all of the above are equal. GDP measures only output, and makes no claims on the quality of that output, let alone on subjective concepts such as social progress or human happiness.”

The editors of Bloomberg View, 30 January 2013, The Bloomberg View

“ អព្ចឹាងហើយបានជាយើងមានភាពវៀងវៃបន្ដិច ក្នុងការបន្លំភែ្នកអ្នកវិនិយោគ នេះខ្ញុំនិយាយដោយត្រង់។​ បើសិនជាយើងសុខចិត្ដឲ្យបងប្អូនចំណាយ១០ដុល្លារ បនែ្ថម រដ្ឋាភិបាលសុខចិត្ដរុញឲ្យដល់១៤០ ប៉ុនែ្ដបែរជា ត្រូវយកពន្ធ​ ឬមួយក៍ត្រូវឲ្យបងប្អូនកម្មករយើងត្រូវចំណាយសុខភាព១០ដុល្លារវិញដដែល ។​ ទី១បងប្អូននៅ សល់ ១២៨ដដែល ហើយទី២តួលេខដែលគេមើលពីក្រៅមក វាទៅជាតួលេខនឹងខ្ពស់ ១៤០ជាង ។​  អព្ចឹាង អ្នកវិនិយោគនឹងគាត់មើលមកឃើញ១៤០ជាង គាត់អាចងាកទៅប្រទេសផ្សេង។  ប៉ុន្ដែផ្ទុយទៅវិញ យើង យក១២៨ តែបូកអាតួលេខដែលបងប្អូនអត់ចំណាយ  អ្នកវិនិយោគគាត់មើលមកថា យី ប្រាក់ឈ្នួលការ យើងដូចជាទាប ប៉ុន្ដែភាពពិត គឺបង ប្អូនយើងអត់មានបាត់បង់ផលប្រយោជន៍ទេ ។​”

ហេងស៊ួរ អ្នកនំាពាក្យក្រសួងការងារនិងបណ្ដុះបណ្ដាលវិជ្ជាជីវ: ១៨វិចិ្ឆកា ២០១៤ ​វិទ្យុ​អាស៊ីសេរី

“People [garment workers] just don’t have enough to eat, and that’s surprising to me for a population with a monthly salary. It is surprising and interesting and disturbing.”

Chief researcher Ian Ramage of Angkor Research and Consulting Ltd on garment workers’ health and productivity, 30 September 2014, The Phnom Penh Post

“At the moment, we follow the free market economy [by not imposing any regulations on rent control].”

Labour Ministry spokesman Heng Suor, 19 November 2014, The Cambodia Daily

“For those who said the government must pay this payment or that payment [minimum wage fixing], it is wrong. That is not how a market economy works… It is impossible to make such a requirement. The requirements of a market economy are based on the enterprise’s profits.”

Premier Hun Sen, 13 March 2013, The Cambodia Daily

Now, it is clear how Hun Sen government comes up with the monthly minimum wage of $123. Heng Sour explains it comes from what he calls a generally accepted principle that a minimum wage should be 110% to 115% of GDP per capita which he says is about $1,230 per annum, or $103 per month for Cambodia. Thus, the initial offer of $123 is rather generous as it amounts to 120% of the GDP per capita. It becomes more generous when Hun Sen throws in another $5, taking it up to 125%. How munificent.

There are, nevertheless, two problems Heng Sour or the government may or may not want to know. First, the GDP they base the minimum on is not designed to be a scorecard of a nation’s economic health and well-being. It is merely a gross tally of products and services bought and sold, without any distinction between transactions that add to well-being, and those that diminish it. Lagarde and the Bloomberg View imply the GDP measures everything except those that make life worthwhile. Hence, the $123 leaves out workers’ welfare, though the extra $5 may go in the right direction, no matter how petty it is.

Second, Heng Sour’s explanation of how $140 would have the same value as $128 to the workers is mind-boggling. He says this is due to a foregone marginal tax liability and extra cost of employment injury insurance premium they would have to pay. However, the tax benefit of having a lower gross income is irrelevant as the tax threshold has already been lifted to $200 per month. There is no tax payable on either $140 or $128.

Contrary to Heng Sour’s claim, the workers do not have to pay the $10 for the insurance, unless the government is planning to turn upside down the current workers insurance scheme. It is the employers, not the workers, who must pay a premium of 0.8% of the employees’ wage for the cover.

Therefore, it is uncertain whether Heng Sour lies to validate the $128 amount, or he simply does not really know how the tax and insurance scheme work. Then, again, he may just be doing the leg work for GMAC to lower the costs for the employers who pay “donations” to all ministries of the Hun Sen government. By securing the $128, rejecting a potential $140 blow-out, the government saves the employers up to a cool $87 million per year. Heng Sour appears to support workers by pretending to pull a fast one on foreign investors. GMAC would know, however, he is just manipulating public opinion to protect the employers’ interest.

Overall, the government policies are either confusing or calculating. They advocate a free market economy concept by refusing to regulate rents, and allowing the domestic oil distributors cartel to freely overcharge consumers at the bowsers. Yet, they fix the minimum wage, which contradicts the concept, but consistent with a moral bankrupt that exploits workers for the benefit of their personal interest groups.

Ung Bun Ang

Parthian Shot

“We don’t want to make him [CNRP Parliamentarian Yont Tharo] feel bad because he’s just had a stroke and he’s not very well.”

Sam Rainsy, 27 November 2014, The Cambodia Daily

The CNRP president shows his kind consideration for his parliamentarian colleague Yont Tharo by not directly asking him to stand down in a plan to release another colleague Meach Sovannara from jail. He prefers to discuss the issue openly with the Cambodia Daily.

Yont Tharo responds via the Phnom Penh Post with a big fat “No”, without realising that legally he has no say in the matter.

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Pseng-Pseng is published on the tenth, twentieth, and thirtiest day of every month. Previous issues are archived at

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