Employers should cheer the new super union

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Via Domainfax:

The Fair Work Commission on Tuesday approved the controversial merger of the Construction, Forestry, Mining and Energy Union, the Maritime Union of Australia, and the Textile, Clothing and Footwear Union of Australia.

…Employer groups on Tuesday said the creation of a super union “put the economy and jobs in jeopardy” and flagged they would appeal the merger decision.

…”Business has too much power, we have record levels of inequality in our community, and working families are finding it hard to make ends meet,” he said.

“It’s time for big business to stop riding on the coat-tails of everyday working Australians, time the banks stopped ripping people off, and time for every business in this country to pay tax. Nearly 700 big corporations pay no tax, which is a national scandal.

“We are absolutely committed to a change of government, to changing the rules to restore balance and fairness into our communities, and to growing our movement.”

And what about wages, eh? As Australia’s terms of trade keep deflating, the income squeeze that has gripped the economy will continue. The primary mechanism that has been used to push that adjustment onto wages is mass immigration, which boosts aggregate demand on behalf of capital but deflates the individual’s labour share of it.

Given the CMFEU is the powerhouse here, what does it think of the immigration/wages issue? Here’s what it wrote for the 2016/17 year:

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The Department seeks consultation on the size and composition of Australia’s migration intake for 2016-17. Currently, there are up to 190,000 permanent migration places available in 2015-16 consisting of the skill, family and special eligibility streams. This does not include other significant components of Australia’s migration system including temporary work visas (temporary work visas 457, working holiday visas, student visas) or the humanitarian program. The 2015-16 Migration program planning levels include 128,550 migrants through the skill stream (68.9% of the total managed migration program) and 57,400 through the family stream. In the skill stream, 37.5% of migrants are employer sponsored, 34.2% are skilled independent and 22.4% are state/territory and regional nominated. In terms of the size of the program, the CFMEU supports no change to the current intake given the current economic climate and high level of unemployment. In terms of the composition of the program, for the reasons specified in the sections above the CFMEU supports a shift away from employer sponsored visas to policy driven migration and permanent independent skilled migration and family reunion visas. We recommend the removal of the Business Innovation and Investment Program and support the importance of permanent migration through the family stream. It is clear that the skilled migration stream is being primarily served by temporary work visa holders, including 457 visa holders. As such there should be no policy difference in treatment between permanent and temporary migrants. There is an urgent need for a re-evaluation of the relationship between these two schemes. Our migration program needs to be realigned towards permanent migration in Australian long-term national interest.

Some mucking around with labels but no cut to the intake and plenty more “skilled” – read over $53k workers – why? My guess is these unions don’t care for three reasons.

First, the services economy where foreign labour rorting is most rampant is the least unionised. Unions are turf warriors par excellence so as long as their own members aren’t being displaced then it’s business as usual.

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Second, the most heavily unionised sectors of the economy are those that are benefiting most from the great immigration scam. Think increased public sector employment, building infrastructure and dwellings, education boom etc. The people ponzi grows these sectors more than others, from the Jericho Sell-out:

Third, the unions’ direct parliamentary representation, the Labor party, is the strongest champion of the mass immigration scam in Canberra. So for unions to protest, they’d be in direct conflict with their own vertical market monopoly.

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The new super union only represents a small minority of workers and it may benefit those few members with some increase in bargaining power. But by supporting unchanged levels of mass immigration into an over-supplied labour market the super union helps kill wages on a much more broad basis.

Employers should cheer it on.

About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.