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Labor's flawed fightback

By Henry Thornton - posted Tuesday, 19 July 2005


I suspect it is impossible to know the answer about whether introduction of "more flexible" wages and conditions will lead to more or less satisfaction, allowing for all the relevant aspects of "job satisfaction". To the extent that it is another step in the reform of the Australian economy, the net effect is likely to be more people working harder for higher average wages and some people more employed than they would have been but on lower wages. In practice, sensible judgment will only be possible years after the event. In the meantime, there is a battle for people's hearts and minds on the subject and Lindsay Tanner is a powerful, if in my view misguided, advocate for the naysayers in this battle.

Tanner makes another point in his article, one that, to my mind, is far more powerful. John Howard "is protecting chemists from competition from supermarkets. He's protecting the privileged positions of companies like Telstra and Qantas.

"In John Howard's world low-income workers have to compete with each other, but they're denied the full benefits of competition when they buy medicines or make phone calls. How fair is that?"

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Chemists, Telstra and Qantas could of course point out that they need protection because of the generous employment conditions they are currently forced to provide their workers, which brings us back to the first point. In economics, as in life, everything depends on everything else. This point, however, requires some subtlety to grasp and will probably not gain traction in the political debate.

So Lindsay Tanner has conjured a hit, gentle readers, a palpable hit. With more arguments like this, Labor will be back in the game. As I said at the outset, Lindsay Tanner is a clever bloke.

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First published in Henry Thornton on July 11, 2005.



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About the Author

Henry Thornton (1760-1815) was a banker, M.P., Philanthropist, and a leading figure in the influential group of Evangelicals that was known as the Clapham set. His column is provided by the writers at www.henrythornton.com.

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