Anxiety Breeds Passivity

Over the weekend, Conservative senators announced that they will re-introduce a bill which previously sparked rebellion in the Red Chamber. The bill would force unions to publicly disclose their spending. It's all part of a movement which began forty years ago. Murray Dobbins writes:

In those pre-corporate globalization days, it was conventional political and social wisdom that the economy served the nation, and by inference, the community and families. The Bank of Canada's dual mandates -- unemployment and inflation -- were still competing but full employment was one of the few shared policy objectives of all three federal parties. It wasn't until the early '80s that inflation took a serious bite out of the accumulated wealth of the West's economic elite. That changed everything and "inflation fighting" became the obsession of the West's central banks.

But more than that it also became the weapon of choice of free-marketeers like former Liberal finance minister Paul Martin who with the co-operation of the Bank of Canada used extreme inflation targets (and subsequent high interest rates) to actually suppress economic growth and deliberately create high levels of unemployment. Few people recall that under Martin's ideological war on inflation throughout most of the 1990s, unemployment hovered around 9 per cent -- higher than it is now.

Martin's war on inflation was actually a war on labour, justified by the signing of the Canada-U.S. Free Trade Agreement and subsequently, North American Free Trade Agreement. It was all about global competitiveness and that meant driving down the cost and power of labour. Enforced high unemployment was perhaps the most powerful weapon, but dramatic cuts to Employment Insurance eligibility and the elimination of the Canada Assistance Plan (CAP) were effective as well. The CAP transferred money to the provinces and was targeted specifically at establishing a minimum national standard for welfare. With its cancellation and replacement with a lump sum (for health, education and welfare), the provinces radically reduced social assistance rates and shifted money into the politically popular items like medicare.

And the War on Labour continues to this day. It has reached the point now where the Harper government puts an end to strikes before they begin, based on the bogus argument that the economy is too fragile to permit labour disruptions.

The strategy is to keep workers anxious and living pay cheque to pay cheque:

Over the past few years, a stream of reports have revealed just what that sacrifice has entailed. It has even fostered the use of a new term to describe modern working life: precarity. The numbers are scary. The Canadian Payroll Association's annual poll revealed recently that 51 per cent of Canadian employees would be in real financial trouble if their paycheque were delayed by a week. A week. A quarter of those surveyed said they couldn't pull together even $2,000 to deal with an emergency. Almost half said they were spending all their income -- or more -- on basic family needs. The savings rate is now below 4 per cent -- it was 15 per cent in the 1980s. Personal debt is at record levels, some 160 per cent of annual income and no wonder: the real income gain of the average employee between 1980 and 2005 was a measly $52 -- two dollars a year. The only thing keeping many families afloat is rising house prices. But 17 per cent of mortgage holders will be under water if rates rise just 1.5 per cent.

Keep workers anxious and you keep them passive. And, if the population is passive, you can get away with anything.

Behind The Numbers

When Parliamentary Budget Officer Kevin Page released a report  two weeks ago, which documented the average annual salary of a federal employee as $114,100, there were howls from the usual critics. Andrew Jackson writes:

The Canadian Taxpayers Federation was quick to jump on the report of the Parliamentary Budget Office on federal government pay and compensation, saying that it provided “shocking numbers on the overly generous compensation of federal government employees.” Echoing similarly-exaggerated claims by the Canadian Federation of Independent Business and other employer groups at its recent pre-budget hearings, the House of Commons Finance Committee has just called for a review of public sector compensation and benefits.

But, if you dig down in the numbers, things become a little clearer:

Three of Canada’s leading academic economists — Morley Gunderson, Douglas Hyatt and Craig Riddell — conducted a study for the Canadian Policy Research Networks in 2000. The foreword summarizes their views on public/private pay:
“
(T)he answer to the question of whether there is a ‘pay premium’ associated with employment in government is far from a simple one. On the one hand, some groups, such as senior managers and specialized occupational groups, such as information technology workers, are paid less than their private sector counterparts. On the other hand, women in government, especially those employed in service jobs, such as food services, tend to be more highly paid than women in the private sector. It is clear that employment and pay equity policies, coupled with decades of collective bargaining, have narrowed the pay differentials between men and women and between the highest and lowest paid workers.”

A 2006 report by the Treasury Board Secretariat comparing federal sector and private sector compensation similarly found that the average federal government pay premium was “small” and existed mainly for lower-paid workers. Managers and professionals in the federal government, particularly senior managers, lag behind the private sector. Only a handful of senior deputy ministers earn the $220,000 per year needed to break into Canada’s top one per cent of taxpayers.

The Harper government and its allies have been conducting  a war on wages for over a decade.The problem is that their targets are lower paid workers -- not those who earn high salaries -- particularly in the private sector.

And you wondered why those F-35s cost $45 billion?

The War On Wages Continues

On the subject of rotating teacher strikes in Ontario, Tom Walkom offers a little historical perspective:
 

When Bob Rae’s New Democratic Party government overrode collective agreements in 1993, many private sector unions — including the Steelworkers and my union, the Communications, Energy and Paperworkers — broke with their public sector counterparts to support the NDP regime.

The essence of their argument would be familiar today: private sector workers had already suffered from what was, at the time, the biggest recession since the 1930s; therefore, public sector workers had to sacrifice as well.

It was an argument that resonated with their rank and file. But it ignored the real story, which was that government was changing the rules of the entire collective bargaining game.

We know that, two summers ago, Jim Flaherty met with Canada's movers and shakers, and one of the items on their agenda was lowering the cost of Canadian labour. That wish became reality when Bill C-377 passed the House. Last week, Tim Hudak -- whose bulb has never burned very brightly -- announced that, when he becomes premier of Ontario, he will table Right to Work Legislation. And, yesterday, General Motors announced that it will move production of its Camero from Oshawa to Michigan -- even though Canadian and Ontario taxpayers helped keep the company alive during its darkest hours.

Walkom writes that the teachers strike is a moment of truth for Canadian labour:

So think of this latest foray against teachers as part of a package. In Ottawa, the federal government brings temporary workers into Canada to staff doughnut shops. They do so not because the ability to pour coffee is an unusual skill, but because doughnut-shop owners don’t want to pay the wages expected by Canadian workers.

In Ottawa and at Queen’s Park, governments respond to deficits by cutting away at social spending. The reason here is that programs like employment insurance keep workers from becoming so desperate that they will take any job at any wage.

Like Canada's native peoples, it's time for labour to be Idle No More.