Arguing the B300 minimum wage case
"We are entering the Asean Economic Community in the very near future, so how can we compete with our neighbours?"... "Foreign investors will move away from Thailand, to places where labour is cheaper, such as China, Cambodia, and Vietnam"...
These are the opinions of the business sector and many economists, apparently prioritising the competitiveness of the Thai economy even if it comes at the expense of workers' living standards.
However, the fact is that in a capitalist free-market economy, undercutting the international price of labour is not the only way to achieve comparative advantage. Such arguments should not be used as a justification for keeping the minimum wage as low as possible.
Indeed, in the transition towards becoming a developed nation, countries must accept that this strategy is unsustainable in the long term, as no developed economy has ever been able to maintain this comparative advantage over developing nations.
What about the future of unskilled workers? Are they expected to resign themselves to a lifetime of low wages to support the supposed "national interest" of Thailand's economy?
When speaking to red shirt supporters in Laos at his public appearance during the Songkran festival, former prime minister Thaksin Shinawatra said: "Brothers, life will be better now. Prime Minister Yingluck has already implemented the '300 baht' policy. Your children will earn more from work."
As we know by now, any such statements coming from Thaksin will be jumped on immediately by opponents who will level accusations of irresponsible political populism at him.
The income gap in Thailand today is glaringly obvious to anyone who can face up to this fact. To categorically dismiss as irresponsible populism attempts to correct this injustice, however imperfect they may be, implies a serious lack of concern for the plight of millions of decent yet underprivileged Thais.
Pasuk Phongpaichit and Chris Baker have argued: "Thaksin's populism was more complex than his policy offerings, in that it developed over time in response to social demands. Thaksin may indeed have been opportunistic, but there would have been no opportunity if there had not been a social demand."
As Warren Buffet once argued: "A market system has not worked in terms of poor people."
The intrinsic injustice of this system is interpreted within the anti-capitalist discourse of Thailand as tunniyom samarn, or "evil capitalism".
Moreover, what is often referred to as the "free market" is far from being free of market manipulation.
Notably, when we look at the examples of the most advanced capitalist countries, such as the United States and the United Kingdom, we find many forms of government intervention.
Indeed, as far as we can recall, there has always been evidence of market failure. And it has been quite common for there to be some degree of government intervention within the market which distort both prices and costs, including labour costs.
Every Friday, a truck takes mothers and fathers from the village of Ban Tadop in Si Sa Ket province to visit their children, by now mostly in their 20s, who are working in factories in Samut Sakhon.
The main reason for the families to undertake this journey is to collect remittance money from their children, and at the same time, to bring them staple foods such as the rice they have grown in the village.
Such efforts are undertaken in order to minimise their child's cost of living, which is higher in Samut Sakhon than in the villages.
Labour migration from the Northeast has been both permanent and seasonal. Both have made an important contribution to improving the quality of life for rural villagers.
To a significant extent, these remittances can help make life more comfortable in the rural provinces, and is an example of how market mechanisms can contribute towards raising living standards when the state does not.
Hoi Kambongsa, a 53-year-old worker from Ban Don Chot, Ubon Ratchathani, said: "The 300 baht [minimum wage] is good for our family, living in a rural village. I don't have a full-time job.
"I receive money from my six children who work in Bangkok, although not very often. But this really helps to make my life a lot easier."
A high percentage of the rural population in the northeastern region today depend on these remittances to at least some degree.
Older generations living in rural areas of provinces such as Ubon Ratchathani typically receive approximately 5,000 baht a year in remittances. Although this figure might not appear to be particularly significant for the urban middle-class, this extra money is needed for their subsistence.
This is also the main contribution of remittances in relation to the economy, boosting grassroots incomes and spending which have the positive benefit of stimulating Thailand's macroeconomy.
The supply of both permanent and seasonal labour from the region stems from what economists call the "opportunity cost" of workers not having a job in their village or district. Moving to work in a factory for even a very low wage becomes the "rational choice".
Some economists make the argument that if there is enough supply of labour for jobs available, there is no need to increase the minimum wage.
It follows from this statement that if workers remain in their current employment, they must be happy with the status quo. However, can this argument be justifiably made if workers have no other options available to them?
Of course not.
Ultimately, there is a moral for us in all of this. We are speaking here of the demographic which has so often come under attack during the political blame game that has accompanied the conflicts afflicting Thailand in recent years.
This demographic is the rural population of the Northeast provinces, who realistically have few choices in life.
To live viably at all, they must work in the fields and subsist by producing rice and selling their surplus. They seize the opportunity of employment as seasonal migrant workers in factories in distant provinces. Very often, they are not even paid the 300-baht figure which is now being introduced as the minimum wage for Thailand.
These are the people from the poorest region of our country who are routinely patronised by other Thais and made to feel as though they are second-class citizens because of their "shortcomings" and their lack of education.
We may only become more genuinely concerned for their well-being and future if we take the time to realise that these very people are the ones producing Thailand's staple rice crops which keep food prices low and help to fuel the lives of all Thais.
Then, perhaps, we would think about the fact that they so often take these low-paying jobs in factories that most other Thais would certainly not undertake. To argue their case then becomes the least we can do.
Titipol Phakdeewanich is a political scientist at the Faculty of Political Science, Ubon Ratchathani University.
http://www.bangkokpost.com/opinion/opinion/295497/arguing-the-b300-minimum-wage-case
