How capital and the state have redefined the value of labour since 1975: case studies of rationales for minimum incomes in Australia.

Abstract

Minimum incomes legitimate a boundary between capital and labour, profits and needs, in the contest over value. This thesis asks how minimum income setting has changed since the 1970s. It finds answers in the documentation of rationales by state agencies in national wage cases, policy and inquiries into income support, financial regulation and the Financial Services Royal Commission. The minimum wage as a family wage was overturned, on the basis of two partly linked factors, employer pursuit of reduced labour costs, and the growing proportion of mothers in paid work at non-standard hours. A previously strong union movement in response to unemployment crises, laid down its power to defend the minimum wage. The minimum wage safety net from 1996 became a minimum wage for a single person, requiring the state through income support to underwrite the cost of raising children in low waged households, but without compromising current labour supply. The household rather than the wage earner became the object of both public policy and financial capital’s search for value. Finance’s invention of income surplus assessment for contracting home loan repayments placed new pressures on household time and consumption, reinforcing the labour supply imperative. It also posed a novel threat to financial system stability, and placed the setting of minimum living standards as a boundary not just between labour as employee and employer capital, but also between labour as household and financial capital. The state’s position on meeting needs through minimum incomes requires trade-offs that historically were dominated by social and industrial order, and which have more recently been refined as economic policy for labour supply and particularly financial stability. Minimum incomes are linked to labour’s dual position as a cost of production and a critical source of financial flows. This new terrain for valuing labour sharpens the contradictions to be managed by public policy that accepts profitability as the underlying imperative, seeking stability of flows in both labour markets and money markets. It also poses challenges for labour to reshape itself as a conscious agent able to assert its needs over profitability, and to challenge the hold of capital over livelihoods.