It’s one thing for these ridiculous populist policies to spend government money on all and sundry, whether they deserve decent health care or not.  But it’s quite another when they start telling private businesses to start shelling out and, horror of horrors, propose a whopping increase in the minimum wage.

Let’s just get a few things straight about this minimum wage. 

First, it is enforced only sporadically.  In fact, it wasn’t until 1993 that the rules governing the minimum wage rules saw fit to include the radical idea that ‘Employers are prohibited from paying their employees less than the minimum wage rates.’ 

Thousands of small businesses, where most of the gross violations of labour rights occur, are effectively un-policed.  With a seemingly endless supply of millions of desperate job-seekers from Burma, many workers have a well-founded fear of being replaced by a semi-slave, and so are reluctant to risk unemployment by speaking out against abuses (of the minimum wage law and other things).  And employers know this.  But of course their superior education, morals and sense of public-spiritedness prevent them from exploiting this. 

You wish.

Figures on the median wage (the wage you get when half of wage-earners get more than you and half get less) show that in many provinces this is less than the government-mandated minimum wage.  This means not that some workers in these provinces are getting below the minimum, but that most workers are getting less.  And a ‘minimum’ where most earn less than the minimum is quite simply no minimum at all.

It took me a long time to figure out why the people who seemed to be most agitated about getting increases in the minimum wage were not the downtrodden of the sweatshops and cane plantations, but the employees of state enterprises.  Surely government-owned outfits paid the legal minimum, and a bit more?

Of course they did, but just about everyone’s wage-packet was calculated as a multiple of the minimum wage.  So while a 5 baht a day pittance of an increase hardly seemed worth the bother for those at the bottom of the pile, a section head was looking at an extra 5-600 a month.  Worth belly-aching about.

The basic wage is only part of the package.  Most employers have a raft of add-ons, for productivity, punctuality, no absenteeism, not spending forever in the loo, etc.  These are crucial in making it a liveable wage.  But it also means that if the basic wage goes up, employers can keep their total wage bill under control by simply reducing the add-ons. 

And don’t think that increases in the minimum wage pass unnoticed by all those people who have no minimum because they have no wages because they have no employers.  Like the woman selling kai yang outside the factory gate, or the driver of the overloaded song thaew that gets workers to and fro, or the landlord of the rabbit hutches that they rent.  As soon as the minimum wage goes up, so does the cost of lunch, of getting to and from work, and of having a place to stay.  The effect on discretionary spending can be close to zero.

And let’s also note that while the Bangkok Post carries dire warnings from the expat CFO of a multi-national who foresees another crash in the Thai economy if the minimum wage goes up (to a level that just about makes up for the loss in purchasing power from the miserly increases over the past decade or so), the same newspaper runs puff pieces for meals at 2,500 baht per ‘degustation dinner’ (equivalent to 8.3 days’ work), for ‘lashlift’ mascara at up 1,300 baht (4.6 days), for ‘a very sound SUV choice for families’ at up to 1.513 million baht (16 years and 37.6 days), and for get-away 149 m2 condos in Hua Hin at 110,000 baht a square metre (174.6 years).

Yes, Virginia, there’s something of a problem here with gross and widening disparities of wealth and income.  And 300 baht a day is only the start of solving it.