Union power: The Wings of an Eagle Attached to a Pigeon head

In view of the debilitating strikes that are continuously surging in Greece at this critical moment that the Samaras Government is attempting to pull Greece out of the crisis and put an end to the great sufferings of the people, I’m republishing this essay that was written twelve years ago.

By Con George-Kotzabasis 

The following essay was written on April 2000. It’s republished here on this blog as I think it’s still relevant as unions continue to have a strong grip on the Labor Party. And with a possible impending recession in the US that would inevitably effect the Australian economy, a Rudd victory in the coming election will bring the unions exercising their pernicious behind the times influence on the front benches of a Labor government. And hence exacerbate the peril of the economy of the country in conditions of recession. Lest we forget, it was in the UK in the mid-sixties under Labor governments that ‘trade-union-led “wage push” was the driving force behind inflation and subsequent breakdown of Keynesian policy’. Richard Kahn, one of the closest disciples of Keynes, when he was asked about this breakdown of Keynesian policy, he answered, ‘we never thought the leaders of the trade unions could behave so stupidly’. This stupidity was coined at the time in the term of stagflation, the proud creation of the unions. And this doltishness of the unions is alive and well in our times as it’s still fuelled by the false Marxist doctrine of class struggle. This is the danger that trade unions could inflict to the Australian economy under a Rudd government. As for Rudd’s “education revolution” by providing students with laptops, the mountain has brought forth a mouse. Australia is already among the top nations that provides computers to its students. But on the quintessence of education revolution which has to deal with its human capital, i.e., its teachers, who have to be selected on merit and ability and on their teaching methods, two burning issues on which the education unions will not budge, Rudd remains silent. He also claims that his government will be a government of “fresh ideas and new leadership”. But after his lustful embrace of me tooism of some major liberal policies during the electoral campaign, Rudd pellucidly reveals that his government will not be a government of “new leadership” but a government of mimicry. For John Howard there is still a good chance that the minders of Kevin Rudd, couple days before the real poll, will be telling him that the only bad news is that there is no good news. 

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The ascendancy of the Labor Party to the treasury benches in Victoria, has churned in its wake a billow of waves of industrial action by an amalgam of union power that threatens to shipwreck the economic vibrancy of the state. The outcome of such fatuous action by the unions will be to induce a flight of investment capital from Victoria to other states, as current and would-be employers of this state would feel too insecure to invest in an environment of industrial turmoil. This is especially so when the Labor government and its leader Steve Bracks are perceived to be irresolute and too weak-kneed to control and rein in this outdated aggression and belligerence of the unions against employers.

The excessive and irrational demands of the unions for a thirty-six hour working week and a 24 percent increase in wages, which if they were successful in obtaining initially in the construction industry and their inevitable flow into some other industries, would have the ineluctable result of throwing thousands of workers among the ranks of the unemployed. This would be a tragic repetition of what happened in the metal industry in the late 80s as a result of excessive union claims, under the then Federal Secretary of the Metal Trades Union, George Campbell—a political stallion of the Left and presently a Labor Senator who is going to be replaced by another stalwart left-winger Doug Cameron who has indisputable credentials of being in the past a real “communist under the bed”—whom the Treasurer Paul Keating accused of having a necklace of 100,000 dismissed metal workers around his neck.

It’s obvious that the unions are afflicted by an innate inability to learn from their past sloppy errors. And like a recurring malady they are bound to contaminate the economy of the country with the calamitous mistakes of the past. The consequences of a repeated mistake, however, are more tragic than the consequences of an initial one and therefore carry a greater responsibility. An action that is performed for the first time is experimental in regard to its consequences, as no one, without the gifts of Tiresias, can predict or foresee whether its results will be benign or malign.  (Not that the unions could be excused for their first error. There was ample evidence of a global scale at the time, and enough forewarnings by eminent economists, that excessive union claims within the confines of global competition would inexorably lead to the flight of capital from regions these claims were impacting upon, and hence to unemployment.) But an action that is repeated deliberately and wantonly in spite of knowledge of its harmful effects in the past is intellectually malevolent and morally culpable.

Whose Culpability is Greater the Union’s or the Government’s?

Two questions therefore arise. Is the intelligence of unions commensurate with their powers? Or is it the case that union power is more like the wings of an eagle attached to a pigeon head? If the answer to the second question is affirmative, then one further question is posed, i.e., why then was the political wing of the Labor Party, which is now in government and having the expertise of knowing better about the dire economic effects of industrial unrest to the country nonetheless was unwilling to intervene promptly and decisively to block the irrational and pernicious claims of its industrial wing, which as a government of all Victorians—Premier Brack’s slogan—was committed in doing? Furthermore, why was the government’s immediate reaction to blame the Federal government’s industrial legislation for the ongoing industrial unrest instead of doing something that would have stifled the industrial dispute in its initial stages, for which it had prior knowledge, and using the subterfuge of an excuse that it was constrained by the legislation and could do nothing effective toward its resolution? Both the deputy leader of the government John Twaites and the Minister of Industrial Relations Monica Gould, used this feeble argument, when in fact with the return of the Premier from Davos  the latter forced the union involved in the dispute of the Yallourn power station to return back to work by imposing hefty fines upon its members, hence demonstrating that the government had the power to do something effective to resolve the dispute? Wasn’t it rather, the attempt to shift the blame to the federal legislation, a poor ruse, indeed, a camouflage, to cover its lack of will to intervene timely and decisively and derail the union from its “crashing” course? Yet, the belated action was effective, even if it was done halfheartedly. But what other alternative the government had, at the end of its honeymoon with the electorate, other than to send the stalled fire engines out to extinguish the full blown fire, if it was not to be seen, and impugned, in the electorates eyes, as politically effete and incompetent?

This is a basic characteristic, however, and an irreversible syndrome of Labor governments. To intervene in industrial disputes only when political necessity dictates, i.e., only when these disputes have reached a high point with the potential of harming the economy, and hence would be politically damaging. For organizational and ideological reasons Labor governments are not prone to intervene in the wrangles of their comrade-in-arms with employers, but do so only as a last resort.

This general inaction of Labor governments in industrial disputes is a result first, of a common ideology shared with the unions whose core emanates from the principles of socialism, and secondly, from its constitutional organizational structures that tie the political and industrial wings of the Party into a powerful body and into a compact of consensus that determines the functions of each wing. In conference after conference of the Party, the common and often repeated refrain is that Labor occupies the treasury benches only for the purpose of implementing policies which are discussed and ratified in state and federal conferences in whose conception the unions and its sundry representatives, mainly academics, have a major input. The union’s dominance is illustrated not only in the generation and formation of policies (Its architects generally are academics from the Left, whose intellectual frustration is at a boiling point because their ideas and policies cannot pass muster among other academic luminaries, but who do find a paradisiacal outlet for their “time-stopped” ideas, as well as an adulatory audience among their comrades in the unions, who normally cannot separate the wheat from the chaff of these ideas), but also on the conference floor as sixty percent of its delegates must be union representatives according to the Party’s constitution.

The larger and, especially, the more militant unions have such a firm grip in the election of delegates to Party forums, that even ministers and would-be premiers often cannot be elected to these meetings. Many ministers , therefore, who are unable to be elected to conferences on their own authority, resort to “begging” less militant unions to be placed in their delegations as constitutionally the unions have the authority to do so. Hence only as supplicants to the unions are ministers able to participate in conferences. For example, Jim Kennan, the Attorney General in the Cain Government, for many years was a delegate of the Clothing Trades Union. Likewise too, Steven Bracks, the current premier, was a delegate of the same union, who had taken Kennan’s place with the latter’s departure from politics. Other ministers who are not as fortunate to be union delegates attend conferences as visitors and observers without the right to move, or vote for, resolutions of the conference. Hence, ministers and many of their advisers are left out from the formulation and ratification of the Party’s policies. Such is the power and influence of unions in the organizational procedures of the Party, that often they “lock-out” important ministers who are not close to their ideological positions, from the highest policymaking bodies of the Party.

Moreover, the grip of the unions is extended to the pre-selection procedures of the candidates of the Party as well as in the choosing and changes of the parliamentary leadership, both in the state and federal domains. Who can forget for instance the telephone call that Paul Keating made, during his challenge of Bob Hawke, to Wally Curren, secretary of the Meat Workers Union asking him for his support in the coming challenge to Hawke for the leadership of the government? And Curren obliging, by forcing those MP’s from Victoria who owed their position in parliament to his patronage, to vote for Keating? This irritated Bob Hawke so much asking who Wally Curren was pretending thus ironically that he himself who had ousted and replaced Bill Hayden with union support was not cognizant of the influence trade union leaders have in pre-selections. As for the branches of the Party they play a superficial role in the pre-selection of candidates as they too in turn are influenced in their decisions by the organizational power of the unions.

Labor Politicians at the Mercy of Unions

Being therefore at the mercy of unions for their parliamentary positions and for the buttering of their bread, labor politicians, with some exceptions, are cast as toadies of the unions. Only the Federal Executive of the Party can intervene can intervene and save a ministerial or a backbencher’s scalp from the tomahawk of the unions. This occurred when John Halpenny, the Secretary of the Trades Hall Council in Victoria. were placed in the number one position on the senate ticket, with massive union support, in the 1988 federal election, relegating the leader of the Senate, John Button, to the second position. And in the election following the one in 1988, some of the left-wing unions were deliberating whether or not to place Gareth Evans, the Minister of Foreign Affairs, in the second position on the senate ticket. Only some sober heads at the last moment saved the glitterati Minister from the rusty and blood-stained tomahawk of the unions and from posthumous obloquy. (But the power of the Federal Executive is limited, as is illustrated in the present coming election of 2007 in the seat of Coreo, where the current seating member, Gavin O’Connor, is replaced by an assistant secretary of the ACTU (Australian Council of Trade Unions), against the wishes of the Executive.)

It’s for all the above reasons, this congeniality of interests between Labor governments and unions that prevents the former from acting timely and decisively in industrial disputes. And even when they do as a last resort they cannot be impartial in their involvement. The Brack government being captive to the unions has to cater to the latter’s voracious appetite on a number of issues: On the restoration of common law damages for injured workers, which has already being done by passing the relevant legislation in parliament, on the restitution of industrial policy back to the State Government, so the latter can abolish the industrial contracts of the Federal Government, whose aim is to eliminate union dominance in industry negotiations, and to replace them with collective bargaining, hence restoring union coercion and thuggery during negotiations with employers. On these issues and on many others, the Labor government is hamstrung by union power. Whether the former will be able to deliver on these issues will depend on the political climate of the day and on the degree of resonance such a delivery will have upon the electorate.

Steve Brack’s therefore, like a trapeze artist, has to walk on a tight rope whose one end is held by the unions and the other by the community, and perform his balancing act. While gratifying the union claims, with potentially destructive consequences to the economy of the State, at the same time he has to keep its economic robustness, inherited from his liberal predecessor, Jeff Kennet, intact, hence erasing any fears or consternations the community might have about the new industrial course of his government.

It’s with this purpose in mind to win the confidence of Victorians and of some naïve employers that Steve Bracks lately set up a new stage with an old play. His government lacking any originality or lateral thinking in policymaking ransacked the ram shackled spider web storehouse of past Labor policies to bring out the nostrums of “old age”. The summit of “Growing Victoria Together”, chaired by that scion of Labor power, Bob Hawke, was such a nostrum. Imbibing a strong dose of self-deception, Bracks was hopeful that by attracting some old and new celebrities from the industrial club and from business to the summit the public would be hoodwinked and believe that something substantial would come from the coupling of these celebrities. What in fact happened, was that each spokesperson of this divided house of unions and employers, voiced plaintively their complaints and grievances against each other with the result that they were not able to reach an agreement as to how and by what prudent set of actions, they would carry out the growth of Victoria. The rhetorical statement at the end of the summit, spun by the golden threads of the cerebral and literary qualities of Bob Hawke and his wife, respectively, could hardly hide the practical hollowness of the summit. What the latter did was to set up a number of committees to look at a number of issues.  Such as education and training, investment in training, industrial relations, health and wellbeing indicators to measure performance in meeting social goals, infrastructure, the impact of payroll tax on job and wealth creation , and the audit of government services in country communities. It also set up an advisory body to strengthen community input, oblivious of the fact, that while the latter is important it is not a substitute for political leadership. Forgetful also of the fact that the achievement of this laudable “prospectus”, is absolutely dependent on calm industrial relations. And therefore cannot be achieved while the agitated firebrand steam of the unions continues unabated.

Hence, the mountain (the summit) has brought forth a mouse which is at the mercy of the cat’s paws, the unions. Furthermore, as so many of the issues are to be shoved to committees, whose members are deeply divided on the central issue of industrial relations, they are inevitably going to be dealt with in a banal hackneyed manner, since their members will be unable to reach a mutual agreement on the key issue of industrial relations. Hence the summit’s “debris-deliberations” will be proven to be a barren exercise.

The Bracks’ government by its farcical and enervating stand toward the unions and by its populist stand toward the public threatens to throw Victoria into the doldrums as well as empty the coffers of the treasury. This is not a government of substance but a government of images—the images of a dead past. But funeral rites for dead images can be very expensive to the general community, both in terms of tax increases and unemployment.

I rest on my oars: your turn now

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~ by kotzabasis on February 25, 2013.

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