Top 5 common misconceptions on the European Wage Union

“Equal wages for equal work,” Jobbik and its Eastern European allies want this fundamental right to be finally included in the EU Treaties.

That is why the European Citizens’ Initiative was launched and it was eventually given the green light by the European Commission. However, there are a lot of misconceptions and malevolent rumours being spread about the project to eliminate European wage inequalities. Some of this false information is planted in people’s minds by the Hungarian government’s whispering campaign. This article refutes the most common ones.

Let’s take a look at the most typical objections to the concept.

1. You can’t start paying German wages in Hungary overnight

This is one of the most common anti-Wage Union “arguments” desperately blared by the government’s propaganda machine even though the wage union would obviously not bring western wages to Hungary overnight, and Jobbik never claimed that it would.

The essential aim of the initiative is to help the ideal of “equal wages for equal work” (which means closing the gap between the wages of individuals working in a similar position and similar conditions in different parts of the EU) become a fundamental European right, the legal enforcement of which must be solved by the European Commission.

Thus true integration could finally begin and there would be a chance to spend cohesion funds in a purposeful way, contrary to what happens now when the EURO billions that fail to be stolen by the government and its circle are wasted on spectacular but useless projects generating business for big western corporations.

So this is not an immediate solution but a complex and time-consuming process which should actually have been completed in the past 13 years but has been sabotaged jointly by Fidesz and the Socialist Party in Hungary.

2. Hungarian enreprises would be unable to pay Western wages, half the country would go bankrupt

The refutation of the next common “counter-argument” comes from the answers to the misconceptions above: since the project does not involve an immediate wage increase but a gradual reform of the regulations, there is no need to fear that the economy would collapse.

Such fears are especially unfounded since, as Gábor Vona outlined in his programme speech, a functional wage union requires a radical reform of national economies. The reform would involve the reallocation of the incredibly high tax discounts and subsidies currently enjoyed by multinational companies to Hungarian small and medium enterprises.

According to the data published by Hungary’s Central Statistical Office, the former Socialist governments spent an average of 6.4 million HUF on each job created, while Mr Orbán’s cabinet pays an average of 12.6 million HUF to multinational companies for a job that often involves underpayment, unworthy conditions and overwork. Furthermore, the government covers all employment taxes and contributions of big companies for 4 years in advance.

Just imagine what would happen if these funds could be used by Hungarian SMEs to create jobs and increase wages!

Besides, the EU’s cohesion funds could also be spent on the Hungarian enterprises that create quality jobs locally. These measures could achieve a key goal of the initiative: to enable everyone to prosper in their own homeland.

3. If there is a Wage Union, big business will flee from Hungary

This is another common objection and misconception in terms of the initiative, and the servants of international big business are ready to flaunt it any time they see a proposal to eliminate European inequalities of living standards.

Undoubtedly, the interests of multinational companies would be somewhat curbed if the new principle is adopted but you should not believe that international businesses are omnipotent: if Eastern Europe together and its national states on their own show the sufficient resolve, they can force these companies to swallow the bitter pill.

It has been demonstrated over and over again that multinational companies suffer much bigger losses by being absent from a multi-million market than by paying decent wages to their employees or getting lower tax discounts than most of the local enterprises (remember Tesco’s often-heralded withdrawal when its market interests always made the supermarket chain stay in Eastern Europe instead of leaving a hundred-billions-HUF market to the competitors).

Experience shows that huge manufacturers do not profit enough from allocating their production capacities outside the EU to countries with even less stable economies than ours. If they did, all multinational companies would long have outsourced all their units to Ukraine or the Balkans.

Besides, Hungary’s economic environment could be greatly improved by suppressing corruption as multinational companies are appalled by it (no matter how hard that is to believe with our Eastern European imprints). However, the current kleptocracy can only be replaced by a new, truly 21st-century government.

4. Western countries are not interested in a Wage Union because they live off the cheap Eastern European labour

This objection has some truth in it but you must not mistake the interest of Western European national economies for those of multinational companies, since the two are often different. Fundamentally interested in profit maximization and sometimes willing to make unethical business moves to achieve it, big corporations are obviously happy to have cheap and exploitable yet highly skilled Eastern European labour. However, the workers coming from our region also cause significant damage to the western economies because they exercise a downward pressure on wages, which particularly reduces the chances of the young local population to find a job and increases unemployment in those countries, thus lowering the overall living standards there.

Western European people are much more sensitive to living standards issues than us, and they may as well be ready to take political action. The success of the Brexit campaign was a clear sign of that, and the growing discrimination against Eastern Europeans is another relevant indicator of western concerns.

5. If the Wage Union is realized, migrants will flood into Eastern EU member states as well

This is perhaps Fidesz’ and Mr Orbán’s most absurd and blatant lie about the wage union. Fortunately, it’s a piece of cake to refute it: wages have nothing to do with a country’s security and immigration policy.

No matter how hard the government is trying to blend the two aspects together, the only thing these areas have in common is that a clear political will is required for stopping migration as well as for achieving decent living standards. Hungary’s leadership obviously lacks the will for either of them.

We understand that migrants are an excellent tool to scare people but if we believe the oft-quoted statement of Mr Orbán’s communication, the fence and the legal seal on our southern border has already solved this problem. However, if we choose to believe the other statement which says that the migrant threat is still here, it would just prove the government’s utter incompetency.

As far as the issue of living standards is concerned, Fidesz, regardless if it was in government or opposition, has obviously been unwilling to do anything to prevent Hungarian people from going abroad and to enable them to prosper at home (except for a small privileged group) even though the party had ample time and opportunity to do so.

On that note, it is now clear why Fidesz is so embarrassingly jealous of Jobbik’s achievement: the national people’s party has already done more from opposition to improve Hungarian living standards than Mr Orbán who peddles cheap and vulnerable Hungarian labour from door to door in the world’s investment markets.

Source: Press release – Jobbik