Why Unions Have it the Wrong Way Around

In the past few days industrial relations has set up its own big top. And it’s quite a show…

The Sydney Morning Herald reports that,

‘Construction on new homes and units has slumped to its lowest level in a decade, prompting fresh calls from Australia’s housing industry for governments to do more to support the struggling sector.

‘HIA chief economist Harley Dale said the sector was faring worse now than at the height of the global financial crisis.

‘”That situation is unhealthy and undesirable for Australian businesses and households, while federal and state governments are too slow in taking action,” he said. “Federal and state governments need to get out there and act on investment and reform initiatives to help revive the residential construction industry.”‘

Harley…dude…you’re not serious are you? What more do you want the government to do? They’ve meddled so much in housing they’ve just about run the industry into the ground.

At a time when the housing construction industry is in all sorts of problems, the unions have decided to go feral. These bozos have no idea what they’re doing, apart from playing small minded power games to justify their existence.

Australian labour is amongst the best paid in the world. The high cost of labour is one of the reasons why property is so expensive in this country. When a union makes demands for more of this or more of that it pushes up costs…costs that are ultimately borne by you; the tenant, the shopper, or the consumer of a service.

These high costs are now manifesting in weaker construction demand, which ultimately means less work for builders and their labourers.

And at precisely this time, unions flex their muscles under the pretence of safety issues.

Having grown up in Wollongong, we’ve known a few unionists in our time. For many of them, safety issues are the least of their concerns. Hatred and distrust of management and the ‘capitalist’ is at the heart of the matter.

Unionists have a Marxist outlook. They have a delusional belief that labour is the creator of wealth. Labour no doubt contributes to the creation of wealth but it does not spark the fire. For that you need ingenuity and capital.

Once ingenuity and capital come together in the right mix, they provide an opportunity for labour to join the party.

Unionists have it the wrong way around. That’s why they have to use intimidation and violence to make their point. And with the Labor government’s changes to industrial relations law strengthening the union movement (because unions are major contributors to the Party) intimidation and violence is growing.

It reminds us of something our old mate Freddy Hayek wrote more than 60 years ago:

‘They (unions) have become the only important instance in which governments signally fail in their prime function – the prevention of coercion and violence.’

We don’t know what the stats are but anecdotally we know of many union members who would prefer not to be. Union leaders use coercion to get them to join. And if they don’t, they are ostracised and pushed out of the ‘club’.

Any club that uses coercion to boost membership is a pretty ordinary club in our opinion. In fact, it’s ‘un-Australian’. Yet these thugs wrap themselves in the flag when making their demands.

It really is a case of clowns (especially) to the left of me and jokers to the right (did you see the Republican convention in the US?). There are bozo horns everywhere.

But that’s no way to finish up for the week. How about some humour? Check out the brilliant Flight of the Conchords (a Kiwi comedy duo) charity chat with kids.


Greg Canavan
for Markets and Money

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22-08-2012 – Dan Denning

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21-08-2012 – Bill Bonner

Why China’s Crack-Economy Needs a New Fix
20-08-2012 – Dan Denning

Greg Canavan
Greg Canavan is a contributing Editor of Markets and Money and is the foremost authority for retail investors on value investing in Australia. He is a former head of Australasian Research for an Australian asset-management group and has been a regular guest on CNBC, Sky Business’s The Perrett Report and Lateline Business. Greg is also the editor of Crisis & Opportunity, an investment publication designed to help investors profit from companies and stocks that are undervalued on the market. To follow Greg's financial world view more closely you can subscribe to Markets and Money for free here. If you’re already a Markets and Money subscriber, then we recommend you also join him on Google+. It's where he shares investment research, commentary and ideas that he can't always fit into his regular Markets and Money emails. For more on Greg go here.

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4 Comments on "Why Unions Have it the Wrong Way Around"

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Nik V
This is my first post on your website and I have been an avid (daily) reader of your online journal for 6 months now and I must say it is full of great alternative insights to the mainstream Financial journals which are just full of PR journalism IMHO… so thank you! I am prompted to write this response based on the comment… “Any club that uses coercion to boost membership is a pretty ordinary club in our opinion. In fact, it’s ‘un-Australian’. Yet these thugs wrap themselves in the flag when making their demands.” Not sure about the Un-Australian remark… Read more »

I usually love the articles by this website but this one is definitely written by someone that would go fetch a left handed screw driver if asked to.

I have worked for a large marine construction and maintenance company in Sydney with about only half it’s employees in the union, and I have yet to see any of the accusations you make occur.

Without the workers, all work stops. Get off your high horse thinking your cushy job is more important than a construction workers, our industry didn’t make the world economy crash.

Like the last 2 comments I also love reading the articles on this site. This is also the first time I have left a comment. I grew up on a large farm in the middle of nowhere. In an area that was generally very anti union. At 16 I left the farm and got an apprenticeship as a Carpenter. Upon completion of my apprenticeship I decided to try something different and left the building game in search of money and adventure in the mines. Travelling all over Australia. After 12 years of working in many different roles, I now live… Read more »

Luke is a man unto our Commonwealth’s constitution …..

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