Business Unionism Offers No Solution To Capitalist Crisis

You know that the labour movement is no threat to Canadian Capitalism when it can agree with the bosses on a band aid to the current economic crisis.;

'Job killing' EI premiums hurt workers, employers as manufacturing sector lags

Critics say the current EI program fails jobless workers, many of who don't qualify for EI benefits because they have not worked the required number of hours, as well as employers, who worry about having to pay what Liberal MP John McCallum, an economist, calls 'job killing' EI premiums.
On the employee side of the debate, the push is for more generous benefits.

Not surprisingly, one of the few things employer and employee representatives agree is the need to refrain from increasing the 2009 EI premiums for employees or employers. The chief actuary of the EI commission has already recommended a freeze for 2009, and the commission is expected to take the advice when it announces the 2009 rates this week.
Corinne Pohlmann, vice-president of national affairs for the Canadian Federation of Independent Business, said the commission should go further and cut employer premiums. Continuing surpluses in the EI fund, estimated at $600 million for the last year, should be used to reduce the rate from the current of $2.42 per $100 of insurable earnings, she said in an interview.
The federation also wants the formula rewritten so employers and employees share the cost of the EI plan 50/50, or so that the government picks up a share of the cost. Employer premiums are currently 1.4 times higher than the $1.73 paid by employees.
The business federation and the CLC have both advocated - unsuccessfully so far - to give employers a 'premium holiday' for a period of time if they use the money to train employees.
The Conservative government's plan to move to a new system for setting EI premiums, starting in 2010, is causing jitters in some circles too. A newly-created EI financing board will set the premium rate each year "to generate just enough premium revenue during that year to cover expected payments" and to ensure a $2-billion reserve is maintained, according to government documents. Legislation establishing the new system became law last June.
Diane Finley, named last week to her former post as human resources minister, declined requests to discuss the EI system on grounds she is still getting briefed on the portfolio.
But Georgetti and McCallum said the system means that if the country's jobless rate worsens, as is expected, the board will either have to raise premiums the following year or cut benefits to meet its mandate.
"It has to be one or the other," said Georgetti. "That's the only way I have ever learned to balance the books. And neither one, in this environment, is the way to go."



Once upon a time the labour movement opposed child labour now they decry unemployment of the youth sector of the economy. These are kids working at Wal-Mart, MacDonalds etc., all of course in the non unionized sector.

Canadian Labour Congress: Public Works!
Now That the Election is Over, it's Time to Invest in Jobs That Last

Young workers, many of whom work in accommodation and food services, took a big hit in October. In total, 34,400 workers aged 15 to 24 lost their jobs. At the same time 27,000 people who earned their livelihoods in the accommodation and food services sector were out of a job last month.



And in their recently released paper on the global meltdown they sound more like economic apologists for capitalism than the voice of the working class. There is no discussion of using public and workers pension funds to finance the creation of worker controlled take overs of manufacturing in Canada. Showing that Canada's labour movement has lost the vision of building a new world within the shell of the old. Instead true to its nature as business unions the CLC calls for the state to bail out its bosses.



The Meltdown, Seen from Below
What union leaders, labour experts and anti-poverty activists say needs to be done.

The CLC has just issued a paper on its response to the current crisis titled "Global Capitalism: On the edge of the abyss." The paper says the global economy is now "almost certainly headed for a deep and prolonged recession," and notes that global markets have already fallen as far as they did in the Great Crash of 1929.
The labour group blames deregulated global finance for the crisis, pointing to what it calls "the unregulated shadow banking system of investment banks, hedge funds and private equity funds," and decrying the creation of "fiendishly complex and sometimes outright fraudulent products." The face value of these highly abstract and uncertain financial instruments, the paper notes, was recently estimated at over $50 trillion.
The CLC paper quotes Nouriel Roubini, professor of economics and international business at the Stern School of Business at New York University: "The crisis was caused by the largest leveraged asset bubble and credit bubble in the history of humanity.... a housing bubble, a mortgage bubble, an equity bubble, a bond bubble, a credit bubble, a commodity bubble, a private equity bubble, a hedge funds bubble are all now bursting at once in he biggest real sector and financial sector deleveraging since the Great Depression."
The CLC paper calls on Canada to play a role in creating a co-ordinated international response to the crisis that features re-regulation of both local and cross-border transactions and the imposition of a small transaction tax on all securities trading, including commodity futures. This Tobin Tax, named for the Nobel Prize winner who first suggested it, is designed to discourage short term speculation and to raise the government revenues that will be necessary to fund appropriate investments in social services and infrastructure repair.
Bail out tied to regulation
While many critics of the official response so far are asking why so much money is going into the banks and finance houses that created the crisis, the CLC endorses some bail-out activity as necessary to avert a systemic collapse. The bail out money must come, it cautions, tied to effective regulatory rules.
The CLC wants Canada Mortgage and Housing to re-finance distressed Canadian home mortgages at lower rates, dismissing the view that Canada is not experiencing a housing bubble as a myth. The $10 billion a year in new infrastructure investment the CLC calls for, says the paper, would create 200,000 new Canadian jobs rebuilding roads and bridges, mass transit projects, water works and the like as well as replenishing the country's diminished stock of social housing. A public letter recently signed by 80 prominent Canadian economists has echoed this call for an active and interventionist response by government to the economic crisis.
Further corporate tax cuts should be cancelled, the paper argues, in favor of direct government support for new investments in machinery and equipment, research, development and training.
Even if all these reforms are put into place, says the CLC paper, Canada may well experience serious increases in unemployment, which will expose weaknesses of the Employment Insurance program. Far fewer workers are eligible for EI as it now exists than was true in years past, and maximum rates and time allowed for coverage are both inadequate, according to the paper, which calls for broadened eligibility, higher maximum payouts and longer terms of coverage for the unemployed. The EI system currently has a surplus of over $50 billion.
Call for new pension protection
The CLC paper predicts the current financial crisis will create a severe pensions crisis, and a follow-up paper issued on Oct. 29 calls for the creation of a new pension benefit insurance scheme (financed by the proposed tax on financial transactions) to insure annual pension and RRSP benefits for individual Canadians up to $60,000 a year.
Pensions are a concern for Bill Saunders, too. Saunders, the president of the Vancouver and District Labour Council, says that Canadian workers and their pensions are more exposed to risk during market trouble because of the successful campaign over the past decades to move from defined benefit pensions, which guarantee a certain monthly amount when you retire, to defined contribution plans, promoted by market enthusiasts.
Contribution plans shovel a defined amount every month into mutual funds and other stocks, creating pension payouts that can vary widely depending upon the health of the market, as many Canadians are discovering this year as their RRSP holdings have shrunk dramatically.
"Twenty years ago," said Saunders, "60 per cent of Canadian private pension plans were defined benefit. Now that share has been cut in half. Defined contribution plans just don't deliver the goods for workers the way defined benefit plans do, and the current crisis illustrates that."

The final irony is that despite calls by the CLC to meet with Harper government it appears that labours agenda was accepted by the Premiers and the PM at their first ministers te'te' today.

Harper, premiers agree on infrastructure, pensions

Once again proving Herr Doctor Professor Marx correct:



Trades Unions work well as centers of resistance against the encroachments of capital. They fail partially from an injudicious use of their power. They fail generally from limiting themselves to a guerilla war against the effects of the existing system, instead of simultaneously trying to change it, instead of using their organized forces as a lever for the final emancipation of the working class that is to say the ultimate abolition of the wages system.Karl Marx, Value, Price and Profit, Addressed to Working Men, The First International Working Men's Association, 1865.



SEE:

Concessions Don't Work

And Then There Was One

October Surprise Was The Market Crash

No Austrians In Foxholes

Pension Rip Off



Tags
unionization, labour, CLC, Ken Georgetti, economy, trade union, recession, EI, business unions,
CLC
Labour

Fight Or Else

Under the Liberals the Canadian Armed Forces were a peacekeeping force. They attracted young unemployed Maritimer's with the promise of careers and job skills. Their recruitment drives emphasized the Canadian Armed Forces non combat role in solving crisis's. Recruitment focused on jobs training, career and used humanistic slogan; No Life Like It . These have been replaced by Harpers war mongering slogan; We Fight.

But unfortunately some folks who joined do not want to fight in Harpers war. They wanted a job.

The Canadian military has released several soldiers after they claimed conscientious objection to serving in wartorn Afghanistan, according to internal records from the National Defence department.

Steve Staples, director of the Rideau Institute, said some are enticed by flashy ads, the prospect of steady employment or the chance to help out fellow Canadians in emergencies. He believes the Canadian Forces should find other roles for those who don't want to fight in Afghanistan.

"They thought they were signing up to help Canada, not fight someone else's war in the Middle East," he said.

Scott Taylor, a former soldier who now publishes Esprit de Corps magazine, said some resist deployment because they aren't psychologically or physically ready for combat or because they get cold feet.

Many signed up to learn a trade or because they thought it would be an adventurous career path -- not to fight a war.

"There was a long time when unless you were in the infantry, you wouldn't be doing any front-line stuff where there might be some danger," he said. "So it was kind of like a lifetime of training for a war you never thought was going to happen."

Employee turnover and loyalty pose serious problems for employers of all stripes. Stress, age or other factors including opportunities for more appealing, better paid work elsewhere have valued and highly skilled people changing jobs at an unprecedented rate.

Imagine the problem the Canadian military faces in keeping its well-trained force together. More soldiers are leaving than in the past.

The reason is evident: the work is hard and the pay doesn't always compare well to what can be earned in the private sector. Despite the fact that recruitment is up, the current attrition rate is hard to accommodate, especially in the Afghan mission.

This is particularly true of our Reservists who have regular lives and joined to be part of an armed forces more interested in peacekeeping and solving humanitarian crises. Now as we run out of regular forces for combat they are being relied upon more and more to fill the gaps in Harpers War. Unfortunately when they return from active duty still do not have their jobs assured them. They have to fight to get their jobs back.

Which is why the petition below is so important to support ,as is support for NDP MP Dawn Black's private members bill.

Black wants to make sure soldiers have jobs at home

While the government talks about helping the reservists the NDP is doing something.

The Conservatives’ Throne Speech promised to look at the issue by consulting with the provinces. However, such consultation is simply unnecessary and is a delaying tactic.

“In January this year, I visited Kandahar Air Field in Afghanistan and met reservists from across Canada. Many of them told me that they were unsure whether their jobs would still be waiting for them when their service was completed,” said Black. “Nobody should have to worry about being unemployed because they’ve chosen to represent Canada overseas.”

Job Protection for

Canadian Reservists

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Reservists Speak Out On Job Protection

Comments from the Job Protection for Canadian Reservists Petition.

Andrew Siwy
Lost my job after a tour in Kandahar, Afghanistan

sarah cram
as a serving member i think it's about time. i've lost two jobs because of operations i've attended.

Jadzia Karas
I came back from tour to unemplyment although I didn't have a hard time finding a job it was yet another struggle to go through

Shawn Sheehan (PTE Sheehan)
I am affraid to do what I want to do - serve oversea's, for fear of losing my career that I've work so hard to obtain

Andreea Savan
definately agree, i lost my job after just needing 2 weeks off, for my QL5

Mary Musson
I am a Reservist with over 13 years of service and I also work fulltime in the social services. The major barrier I have to serving overseas is the lack of job protection and guarantee that after my workup training and overseas tour, I will have a job to return to. I joined the Reserves because I love my country (not for the paycheque). My mortgage is paid by my civilian job. I need to have a job to return to or I cannot commit to serving overseas.

Alex Vorobej
This is something that is long overdue! I have been willing to deploy in the past, but my employer would not allow a leave of absence. This has to stop! I have knowledge of some employers who terminate staff who ask to be deployed, or even participate in summer training programs.

Pte. Climie KR
Regimental Motto: "Non Nobis Sed Patriae" -(Not for ourselves but for our Country) - That explains why job protection should be a must

Terri-Leigh Saunders
As a Reservist myself, I am fortunate enough to have an employer who supports my efforts every time I leave on a Class B contract (3 so far) I can only wish the same for others!

Howard Torney Murray, C.D,
As a retired reservist... and business owner... I support this fully.

278 signatures in three weeks.

Have you signed?

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Save Our Troops....Jobs

Forget Red Fridays.
Forget the Yellow Ribbons.

If you really want to support our troops
sign this petition.

Canadian reservists frequently volunteer to serve our country in extended overseas missions. Unfortunately our country--with the exception of the provinces of Manitoba, Saskatchewan and Nova Scotia--does not recognize their sacrifice and some reservists return home only to face the unemployment line.

This situation is simply not fair to the men and women who put their lives on the line for their fellow Canadians.

Therefore we believe it's long overdue for the Canadian government to enact federal legislation that will protect the jobs of reservists who volunteer to serve in extended overseas missions.

While politicians in Toronto and Calgary get into a kerfuffle over posting yellow ribbons on municipal vehicles, they overlook the little fact that there is no Job Protection for Reservists in their provinces. Nor across Canada.

The Canadian reservist, unlike his American counterpart or a pregnant mother, has almost no protection for his job, so that he will usually be taking a big risk employment-wise when he serves his country.

Certain Officers and NCMs of The Royal Montreal Regiment

You can lose your life or body parts in Kandahar, Darfur, or Haiti, or where-ever Canadian Armed Forces are deployed, even at air shows. And to add insult to injury, if you survive, you can also end up losing your job on your return from active duty.

Shame! Shame! Shame! as they say in the House.

Of course prior to Harpers War most reservists and recruits viewed the Canadian Armed Forces as a job, either part time or full time, a career as it was pushed then; there was no life like it. But Harper changed all that. Now they can sign up and fight and if they don't get killed can return to the unemployment line.

Of course labour standards are a provincial responsibility and should be amended, as should Federal legislation. But the fact remains that we should not have to regulate business in the capitalist market place according to the right wing. But once again that fallacy falls flat. Like their much vaunted 'Family Values'.

Major Noseworthy joined our reserve forces in good faith, seeking to do his bit for Canada as a part-time soldier. He answered the call dutifully when asked to go to Afghanistan and fight for peace in that country. But his employer did not have the same sense of duty to Major Noseworthy or Canada for than matter.

In addition to being an army reservist, Major Noseworthy was also the manager at Humber Motors Ford in Stephenville, Newfoundland. That was until he went to Afghanistan and Humber Ford — a firm that claims to be family friendly — refused him a leave of absence to serve his country. Major Noseworthy was dismissed, leaving him to return from his tour of duty and join the line up for Employment Insurance.

And why is there no federal legislation to protect these soldiers?

Jump back to November. That’s when Lt.

-Gen. Andrew Leslie told the House of Commons defense committee that to complete the mission in Afghanistan the Canadian military would have to draw on more of the country’s 18,000 reservists.

At the time Leslie said the military was trying to persuade about 1,500 of them to sign on for two to three years of military duty.

How many of those reservists have, or will have, to quit their jobs to help the country complete its mission?

The federal government was quick to put reserve soldiers in danger by sending them to Afghanistan; the least they can do is ensure they have a job to come home to. Is that too much to ask?

As for employers who require reservists to quit before heading overseas, it’s time to do the right thing. Don’t simply give lip service to supporting the troops, actually do it. If you have a reservist working for you, at the very least grant them a leave of absence if they are willing to put their life on the line for this country.

The only value the working class has in creating capitalism is either as wage slaves or canon fodder.

The Canadian Forces Liaison Council, a group of business people who volunteer to support Canada’s reservists, say this country’s voluntary approach to job protections has worked well.

So the council’s volunteers must have cringed at news earlier this month that a reservist in Newfoundland came back from six long months in Afghanistan to unemployment.

Newfoundland, like Alberta, is among the majority of provinces which extend no job protections to reservists. Meanwhile, reservists are in high demand to fulfil Canada’s commitment in Afghanistan.

But even with service an option for reservists, it’s clear job protections should also be legislated.

That even a single soldier who has served the nation on a potentially deadly mission wind up on the unemployment line for his/her efforts is a national shame.

Surely a call for political action on this front should command more attention than the push for politicians to put ribbon decals on publicly funded bumpers.

Here! Here! As they say in the House.

H/T to Another Point of View for drawing my attention to My Blahg's latest efforts.



SEE:

Kandahar

Afghanistan

War





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The Importance of Savings

In an a interesting article on the Austrian School of Economics and the Great Depression, the author contends that what is necessary to resolve a depression or large scale recession is to increase savings, allowing for real investment funds to accrue.

The reality of this is clear that with the Depression and after, until the late 1960's, most Canadians were savers. Today most are in debt. Which means that a serious downturn in the economy is going to be a disaster.

However as the author points out the way to mitigate that disaster is by increasing savings. The savings culture that resulted after the Great Depression attests to this. However in that case it was a harsh lesson learned the hard way. And unfortunately in our easy credit consumer culture it is one that is forgotten in this long boom.

Austrian Business Cycle Theory: A Corporate Finance Point of View

The lesson is that as long as output prices stay up (through Keynesian
policies) and the Monetarists keep interest rates from rising (or maybe push them lower), if input prices are rising (a real resource crunch), we will have a recession. And the only way out is through the painful but necessary liquidation process.

The best means to transform malinvestments into viable economic activities is
through increasing savings. This means that one of the government’s most effective
policies is to cut taxes on the savers. Those who are savers are usually labeled as “the rich.” Unfortunately, the prescriptions of “get government out of the market” or a “tax cut for the rich” tend not to be politically popular. However, the idea of “tax cuts are for the tax payers” has had some success.

And while he praises tax breaks for savers he mistakenly identifies them with the rich. Which is currently true, because only a relative handful of the population in the G20 countries have access to liquid capital. The average person who used to save, such as my parents, now has easy access to credit and thus is leveraged into debt. However to have a successful saver economy you need the masses to have access to enough surplus cash to encourage saving.

Savings by the wealthy elite while larger than the average persons, are not nearly as effective as a mass saver culture, as witnessed by Japanese savings numbers. And while various explanations are given for Japan's long recession, the reality is that what kept it from flat out crashing as bad as the Wall Street Crash of 1929, with the same global impact, was the savings accrued by the average Japanese.

The way to solve this problem of easy credit, and its recessionary effects on the business cycle is not to expand capital gains tax breaks, or give business tax breaks, or even to encourage investments in RRSPs or Income Trusts, but rather to eliminate all taxes on incomes of $100,000 or less.

The real savers, the folks who saved capitalism according to the Austrians, are our parents and grandparents who were cruelly forced to learn this lesson, to save in order to survive.

In order to encourage individual saving in a credit card debt based consumer economy, tax cuts, not tax credits, are required for the working class. Currently tax breaks for most folks put anywhere from a few hundred to a couple of thousand dollars back in their pockets come tax day, which is Monday.

Now imagine if you actually had the income tax from your income, you could invest in saving. Instead of a paltry hundred or even a thousand bucks this could be anywhere from $5000 to $10,000 to as high as $25,000 annually.

Further if EI were run as a joint investment cooperative between Employers and Workers, without the government plundering it for it's surplus costs could be reduced, And with a profitable investment strategy put more money in workers pockets, while also insuring a better and fairer process for collecting EI. This has already occurred with the CPP. Ironically it is the NDP and the Bloc who support this idea of joint ownership and elimination of the government from EI.

Furthermore such a joint cooperative EI program could offer alternative financial opportunities such as micro credit for self employment opportunities, as well as the usual Guaranteed Income that we associate with EI currently. It would allow for broader education and training opportunities, while not costing as much as the current program does, because the government would not have access to the profit, surplus.

Similarly we should eliminate Workers Compensation Boards and replace them with a joint labour employer cooperative, that would not have the government as its arbitrator or with its hands in the pockets of workers and employers as currently occurs.

A failure to come up with adequate support for an injured worker, would result in the option of the worker to sue the employer in civil court, which is currently not available with the state as the arbitrator. WCB payments would then decrease under such a joint management and investment plan.

It is often argued that labour relations is problematic because it is an adversarial relationship between workers and employers, unions and corporations. While this is true, the real advocate of this adversarial relation is the state who wishes to arbitrate between the two parties. Unions are the working classes voice in labour relations with the bosses and their associations and cartels. The state is never neutral, as we saw with the recent CN strike. It interferes in the natural social relationship between workers and their bosses.

In fact one has to ask why we need the government period. We have common laws, we have workers and employers, and they can resolve their conflicts through negotiations, arbitration, strikes, or mediation. They can cooperate as well for mutual aid and benefit, such as with works councils, joint management labour pension and benefit funds, EI, Workers Compensation, etc. The State is not required for a cooperative commonwealth.

As Samuel Gompers pointed out long ago;

The worst crime against working people is a company which fails to operate at a profit

The more thoroughly the workers are organized and federated the better they are prepared to enter into a contest, and the more surely will conflicts be averted. Paradoxical as it may appear, it is nevertheless true, that militant trade unionism is essential to industrial peace.

What we have endeavored to secure in industrial relations is industrial peace. When industrial justice prevails, industrial peace will follow. It is a result and not an end in itself.

We want a minimum wage established, but we want it established by the solidarity of the working men themselves through the economic forces of their trade unions, rather than by any legal enactment. . . . We must not, we cannot, depend upon legislative enactments to set wage standards. When once we encourage such a system, it is equivalent to admitting our incompetency for self-government and our inability to seek better conditions.

To strengthen the state, as Frederick Howe says, is to devitalize the individual. . . . I believe in people. I believe in the working people. I believe in their growing intelligence. I believe in their growing and persistent demand for better conditions, for a more rightful situation in the industrial, political, and social affairs of this country and of the world. I have faith that the working people will better their condition far beyond what it is today. The position of the organized labor movement is not based upon misery and poverty, but upon the right of workers to a larger and constantly growing share of the production, and they will work out these problems for themselves.

It is not the organizations of labor which take away from the workers their individual rights or their sovereignty. It is modern industry, modern capitalism, modern corporations, and modern trusts. . . . The workingmen in modern industries lose their individuality as soon as they step into a modern industrial plant, and that individuality which they lose is regained to them by organization--they gain in social and industrial importance by their association with their fellow workmen.

Also See:

Not Your Usual Left Wing Rant

State-less Socialism

Fair Share

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