Giles Ji Ungpakorn
Generalissimo Prayut’s junta has announced that it will scrap the 300 baht national minimum wage which was introduced by the previous Yingluk government. Instead they want to use the “floating” minimum wage system favoured by free-market fanatics like Pridiyatorn Devakul. This so-called “floating” minimum wage system allows businessmen and government officials in each province to set a local minimum wage according to their interests. Even though these provincial committees are supposed to have trade union representation, in practice they are either week stooges of the employers or not real representatives of unions at all. This will increase inequality throughout the country.
Deputy Prime Minister for economic affairs, Pridiyatorn Devakul, has claimed that the decline in Thai exports over the last 4 years is due to the 300 baht minimum wage policy. There is absolutely no evidence for this and declines in exports and imports have been experienced in all major emerging economies (see graph). The real cause is the continuing global economic slump.
The lesson from the Thai and Asian economic crisis in 1997 was that the low wage and low technology export strategy, followed by most Thai governments for decades, was making the country uncompetitive, since it had to compete with new entries to the low wage export market like Vietnam, China and Bangladesh. What is more, the neo-liberal free-market policies of previous military and civilian governments had allowed a speculative bubble to grow because of the removal of controls and the fall in profitability of the productive sectors in the economy.
Added to this, the low wages of Thai workers meant that when exports fell in 1996, the purchasing power of citizens within the country was not strong enough to rescue ailing businesses by substituting domestic demand for lost exports.
Today, as Thai exports fall again, repressing the spending power of Thai workers can only make matters worse. It exposes a “race to the bottom strategy” pursued by the neoliberals at the centre of the military junta. This would turn the clock back and make Thailand a low wage – low technology under-developed country. Domestic demand would be suppressed by low wages and could not compensate for the fall in exports, as in the last recession.
But the most important issue is that wages are still much too low to allow workers to enjoy a good standard of living. Three hundred baht per day is not enough for anyone. The level of economic inequality in Thailand is unacceptable. Yet, the generals and royalist officials who have never had to live on 300 baht a day, constantly lecture workers that their wages are too high. Since the coup last year these elites have been giving themselves huge pay rises and other benefits. They have created a bloated military budget and have multiplied the country’s economic problems by the uncertainty due to continued oppression against all critics of the junta and the militarisation of all branches of the administration.
Of course, the junta and its lackeys all profess to follow the King’s Sufficiency Economy. But the Sufficiency Economy is just a neoliberal ideology which aims to preserve economic inequalities because it says that the poor must adapt to their poverty while the rich can remain rich. This reactionary ideology has been constantly promoted by the two military juntas after the 2006 coup and after Prayut’s coup last year. My criticism of the Sufficiency Economy ideology in my anti-dictatorship book was the main reason why I was charged with lèse-majesté back in 2008.
After the 2006 military coup, I wrote in my book, “A Coup for the Rich”, that the new military appointed cabinet was stuffed full of neo-liberals. “The Finance Minister, Pridiyatorn Devakul, was a man who believed in neo-liberal fiscal discipline. He was opposed to too much spending on public health. After the coup the Budget Bureau cut the budget for Thai Rak Thai’s universal health care scheme by 23% while increasing military spending by 30%. Pridiyatorn threatened to axe many good mass transit projects which could solve Bangkok’s traffic…”
Today Pridiyatorn is back in government, keen to push forward with more neo-liberal policies like introducing “co-payments” for the currently free health care system. The junta has already privatised more universities, just like the previous 2006 junta.
Junta chief Prayut has also thrown in some nasty racist comments to back up his opposition to a national minimum wage. Firstly he has trotted out the usual neo-liberal nonsense about so-called “high wages” in Thailand frightening away investors. Worse than that, he tried to play the racist card by saying that it was “wrong” that foreign migrant workers were the main beneficiaries of the 300 baht minimum wage. This is a classic divide and rule policy to destroy solidarity among the working class. In reality, Thailand has a shortage of labour and needs workers from neighbouring countries. They are usually treated very badly anyway and may not receive the legal wage rate. As far as investors are concerned, many large foreign companies in the auto industry, and the high-tech end of the electronics industry, pay above the minimum wage for skilled workers. It is only the backward low investment domestic sweatshops who might complain about the 300 baht wage.
Thai trade unionists need to unite in solidarity across the different nationalities and they need to struggle for a decent standard of living along with freedom and democracy.
Download “A Coup for the Rich” here: https://www.scribd.com/doc/41173616/Coup-For-the-Rich-by-Giles-Ji-Ungpakorn