May Day

Yesterday was May Day, celebrated as the Labour Day public holiday here in Queensland*. And this week, appropriately enough I’m giving two presentations on the case for a four-day working week, one to the Committee for Economic Development of Australia, a business-oriented thinktank, and one to a parliamentary inquiry.

I started writing a post about the prospect of a radical change in the relationship between workers and managers in the information economy, arising from the combination of near full-employment and the shift to remote work for large groups of workers. But I ran out of time, so for now, I will just toss up some points I want to discuss

  • Will full employment be sustained, or will central banks succeed in recreating the reserve army of labor ?
  • How real is the threat of employer spyware extending surveillance into home workplaces ?
  • How should we conceptualise the relationship between workers, managers and owners of capital ?
  • What are the implications for unions?

I’ll throw it open for comments, and think some more about all this

  • At least until the LNP get back in, which I hope is a long time off

19 thoughts on “May Day

  1. “… at least until the LNP get back in, which I hope is a long time off…”

    Albo’s working hard on this, don’t worry.

  2. JQ asks; “How should we conceptualise the relationship between workers, managers and owners of capital ?”

    Like this week in Chile.
    (Don’t we have wall to wall Leftist governments? – just joking!)

    “Chile’s Leftist President Moves To Nationalize Reserves Of Clean Energy ‘White Gold’

    “The world’s No. 2 producer of lithium is the latest country to push for government ownership over mines.

    Not like!…
    “The Chile Project: The Story of the Chicago Boys and the Downfall of Neoliberalism

    By Sebastian Edwards

    “How Chile became home to the world’s most radical free-market experiment—and what its downfall suggests about the fate of neoliberalism around the globe”

    *The Chile Project*

    by Tyler Cowen 
    May 1, 2023

    “An excellent book, the author is Sebastian Edwards, and the subtitle is The Story of the Chicago Boys and the Downfall of Neoliberalism.  This is the only book on this topic where I feel I am finally getting to the bottom of what happened.  Here are a few points:

  3. It’s time to revisit the wealth
    divide in this country. If income inequality is bad, then this is one outcome of the inequitable distribution of wealth in this country. You only have to look at the rental crisis that is gripping Australia. The impression given by the media is that once the supply of housing rises then rents will fall. This is a simplistic view. What if there is hoarding of rentable properties? Wealth accumulation is not always subject to the laws of supply and demand.
    We need a wealth inquiry to determine the real extent of wealth ownership in this country. Now economics suggests that wealth assets can be LAND based, come about due to HUMAN CAPITAL, arises from the direct ownership of FIXED CAPITAL and/or come from ENTREPRENEURIAL ABILITIES. The original source of all wealth resides in private hands but how is this distributed? As there has been no effective wealth inquiry the answer is that we just don’t know. Only census figures give any clues. But wealth ownership can be hidden in trust funds, family trust structures and private company assets.
    Now JQ asks what can this mean for unions. It may mean that unions have to stop asking only for increases in money wages and start demanding things like subsidised housing for employees, sabbatical leave, bonus shares and copyright on workers ideas and innovations to be shared. The idea that an employer owns all the intellectual abilities, outside the normal use of them to do any job, of any worker must be a thing of the past. If an employee comes up with innovative workplace ideas, then they should at the very least share in any profits generated from those ideas.
    My main point is that merely getting higher money wages is not going to help workers. As we have seen this year, inflation can eat away at real wage increases.
    The idea of a four day working week is a good one. Allowing workers to engage in money activities outside of their employment may be the best way forward.
    Still we need a inquiry into wealth that sets out how wealth is distributed in this country. Only then can we tell if workers are being disadvantaged in not just money terms but in terms of their wealth accumulation.

  4. Is there a need to legislate a 4-day week? I assume there are advantages to working individuals for long hours. Maybe firms economise on training costs or maybe it is more productive to have a few people doing things at higher intensity than many working at lower intensity. As evidence of this note the very high salaries paid to middle managers who often would prefer lower work loads with lower salaries. There are many complaints of “burn out”.

    If you legislate lower hours in the face of such costs/efficiencies then there are efficiency costs of moving to lower hours. There could be benefits to shorter hours, too, related to the benefits of a casual workforce and part-time work. These might be working their way through via market pressures but have negative consequences as well..

    Thinking these issues through might help to establish a freer relation between employers and employees where workers provide services up to the point where the marginal benefits of working equal the real wage. This gives flexibility in a situation where one size may not fit all. For example, young family builders might want to work long hours whereas those more aged, who have savings, might want shorter hours.

  5. I don’t think that legislating for a four day working week would be sufficient. There are structural problems that far exceed the distribution of working hours. IT should be paying for the work conditions of human beings, but instead the main use is to increase the flow of income/profits to the ever shrinking few. Only governments can transform this trajectory, at least before humans get so angry they take it upon themselves to act.

  6. “How should we conceptualise the relationship between workers, managers and owners of capital ?”

    It’s a power relation. The the oligarchs, corporations (boards) and CEOs hold most of the power while and for as long as the game is played with capital according to the rules of capital.

    Our proximal problem is the refusal of governments to print and/or tax money in a way that facilitates public spending for public objectives and nation building… or even nation maintenance.

    The projected tax cuts in Australia will starve the government of the necessary funds to purchase the necessary real resources to meet our real problems (climate change issues, housing, health, welfare, education. The tax cuts will further shift spending in the nation from housing, health, welfare, education when these areas are already in crisis. The spending will be shifted to upper middle class and elite consumption (McMansions, 3 SUVs in the drriveway, holidays, sport, entertainment etc.

    It’s simple crowding out. Discretionary private spending will crowd out nation repair, nation maintenance and nation building by governments. People will engage in orgy of consumption spending at the privileged levels while the bottom 30%, growing to 60% or more over time, collapse into total poverty. That process will collapse our entire nation.

  7. Spyware is very much subject to “relations between owners and workers “. Where workers have the power to push back they do, usually successfully. Where a beneficent owner chooses not to use overt spyware there’s no obvious problem, but relying on beneficence is not a solution.

    For example my workplace doesn’t use spyware and barely audits things because they would rather not manage that aggressively. But I’ve got friends at senior levels who have the same spyware with the same automated “accountability” as the lowest peon in their company. If they want to slack off on social media they have to use their own device and internet connection. Viz, their accountability is the usual “don’t annoy whoever supervises them” rather than the Amazon “be provably busy every microsecond of your employment”. The latter is the new and more problematic version, and it’s hard to legislate away when so many jobs now are “serve as a meat puppet for the computer”.

  8. I see the current tendency to print money as partly a compromise between a shrinking real economy and the economist reliance on an every-growing money economy. As Sam Banker-Fraud recently proved, if you control the “value of assets” side of the measure it doesn’t matter how many actual assets you have. Is Australia doing the same with houses… I couldn’t possibly comment.

    The real economy is likely to shrink significantly by 2100, as the real population declines due to the climate catastrophe we’re so enthusiastically committed to. But those billion-odd refugees and a few hundred oligarchs will have an average wealth more than high enough to make global GDP larger than it is now.

    But in the world of weekly RBA press releases about the interest rate du jour that kind of analysis is not so much irrelevant as actively distracting. “real” growth now through increased prices, that’s the ticket.

  9. Wage theft by university seems to be a recurring theme…perhaps the managerial class need to reinstate the philosophy courses on Ethics, and then to attend as students?
    The irony is that under the current unspoken laws of that class, the course session markers would have to pass them all!

    Okay, slightly tongue in cheek with this comment. Seriously though, what have we done with the tertiary education sector under the Dawkinisation of the past 30-odd years?

  10. We’ve destroyed education just as we have destroyed health, welfare and environment in this nation. Fasten your seat-belts. We are in for a very rough ride. There are going to be a lot of very poor, very angry people out there very soon. They have no stake in this system. They are being treated with utter contempt by the elites, by the very well off and by our governments. This will back-fire badly. There will be serious consequences to this nation’s stability and viability if these policies of subsidizing the rich and abandoning the poor are not changed.

  11. If there were three things for a real party to do, I’d say increasing tax upon both the wealthiest people and the biggest profit generating businesses; transforming property related taxes to reduce or virtually eliminate the leverage of interest only loans for capital gains on additional property from what a household needs; and, make any decent education – apprentice programs, tertiary education, both free and a general right of the citizens of Australia. It is difficult to accept how far we have shifted from the existence of Commission housing (which my grandparents, on both sides of my family were in need of and entitled to), to me counting more than a dozen homeless people, sleeping or just caught up with having to stay close to their remaining possessions, at 11am, in the cbd. We, as citizens, have no way of making the political class take serious action on this monster problem. As much as I had issues with Keating, he at least tried. Hewson copped a shellacking, but he was at least honest enough to tell the electorate what he would do if elected. I didn’t vote for him, but I respected him for his honesty. If he had been allowed to stay as the opposition leader of the LNP, who knows how things would have turned out?,Honesty, especially when it is a risk of losing, that shouldn’t be seen as a failure of a given politician; indeed, we should celebrate it as an example of what we want from our political class.

  12. “We, as citizens, have no way of making the political class take serious action on this monster problem.” – Don.

    We do. It’s called “the vote”. Stop voting for the parties who won’t do anything. Don’t vote LNP and don’t vote Labor. We will have to vote Green, Socialist or left independent, solely and continuously. It’s either that or unrest and revolution. Certainly, Australia’s current path is unsustainable in every sense, socially and environmentally. Change or collapse. Socialism or barbarism. These are our stark choices.

  13. Ikon, Glad to hear you accept that we live in a democracy where votes count. But I disagree with your prescription for avoiding “unrest and revolution”. “Socialism or barbarism”? Nah, better to plod along with a mixed economy and a strong emphasis on liberal, democratic values, tolerance and on accepting election outcomes.

  14. Ikonoclast: – “We do. It’s called “the vote”. Stop voting for the parties who won’t do anything. Don’t vote LNP and don’t vote Labor.

    Indeed! Published in the SMH paper edition on 25 Apr 2022 was my letter to the Editor, highlighting similar concerns, that concluded with:

    I think a vote for politicians and political parties encouraging and facilitating more fossil fuels is a vote for civilisation collapse.

    James Hansen and colleagues at the Columbia University’s Earth Institute, in their communication August Temperature Update, a “Thank You” & Biden’s Report Card, dated 22 Sep 2022, presented some ‘predictions’ including (bold text my emphasis):

    The next year, 2023, will be warmer because of the present strong planetary energy imbalance, which is driven by the factors noted above – mainly increasing greenhouse gases. Perhaps an El Nino will begin in the second half of the year, but the El Nino effect on global temperature lags by 3-4 months. So, the 2023 temperature should be higher than in 2022, rivaling the warmest years.

    Finally, we suggest that 2024 is likely to be off the chart as the warmest year on record. Without inside information, that would be a dangerous prediction, but we proffer it because it is unlikely that the current La Nina will continue a fourth year. Even a little futz of an El Nino – like the tropical warming in 2018-19, which barely qualified as an El Nino – should be sufficient for record global temperature. A classical, strong El Nino in 2023-24 could push global temperature to about +1.5°C relative to the 1880-1920 mean, which is our estimate of preindustrial temperature.

    Click to access AugustTemperatureUpdate.22September2022.pdf

    The latest Australian BoM model (NINO34, run on 22 Apr 2023) was recently published, predicting a super El Niño by August 2023:

    The current Earth energy imbalance (EEI) is at an all-time high in the instrumental record:

    It seems to me that ‘predictions’ in 2022 by Hansen & colleagues are looking increasingly likely.

    When are voters going to wake-up and not vote for people that are effectively facilitating and increasing their (and their loved ones’) future suffering?

  15. Harry Clarke,

    Complex systems are not pure, by composition if not by definition. They will be systems of mixed elements with complex mixing ratios and gradients. So, I think we can agree we are not ever going to ever a system that is pure capitalism or pure socialism.

    The closest to pure capitalism would be an oligarchy or corporatocracy where the oligarchs and corporacrats entirely replace government with their own elected board as a de facto government elected from and by only their own ranks. One-person dictatorships don’t really fit the bill of “capitalism”. In hard capitalism, capital must rule which will equate to a group or cartel of dominant capitalists. Corporatocracy looks feasible and workable (short to mid term). It would not be very good for the population or the planet. Given that the dominant capitalists control our leaders and major parties now, we are pretty close to an oligarchy or corporatocracy anyway.

    We need more and better social programs (public health, welfare and education for example) and less subsidies for corporations and the rich. You have commented on how the corporations and businesses got away with keeping Jobkeeper monies which by a normal application of the law (and ethics) they should have been required to return.

    We need more socialism for the poor and less socialism for the rich. There are billions of socialism dollars in our system for the rich, including the tax cuts and tax deductions they don’t need. So, if we want to have just “reasonable” levels of socialism, can we first reduce it for the rich? Lowering or dropping the tax cuts and removing negative gearing would be a start.

    Nearly every second politician in Canberra is on the negative gearing gravy train. And I bet most of the rest aspire to it.

    It is technically possible to negative gear share holdings too, though I am told that that doesn’t necessarily make as much financial sense.

    All of these grubby expenditures and tax deductions to help rich people and upper middle class people to further feather their own nests should be done away with first. If you are in favor of reducing socialism for the rich and comfortable, I am with you. If you are in favor of retaining these privileges, I am against you.

    I am probably upper middle class, in assets if not in income. I am perfectly comfortable and I don’t need all the helps that I get or could get if I went after all of them. I would accept a reduction of our (wife and I) self-funded retiree tax privileges. I think it should happen to assist the young and the poor. Meanwhile, we assist our adult kids a bit (Bank of Mum and Dad) but in the greater scheme of things that is simply unfair to all the young people who don’t have comfortably-off parents who can assist.

    If you care about fairness you can’t possibly agree with what is happening in this country currently. How could anyone think this neoliberal status quo [1] is fair, just or even sustainable socially or environmentally? If you do think it fair and sustainable, I don’t think you are thinking clearly, objectively or socially (as opposed to individualistically).

    Note 1: In all economic essentials, Albo’s government is as much neoliberal as Morrison’s ever was.

  16. New language please.
    Any comments with socialism or capitalism banned.
    Try something new.
    (Ban lockdown too)

    “Ostromizing democracy 

    “Hardin’s flawed account of the commons is a sterling example of the problem with economism, the ideology that underpins neoclassical economics:

    “The Ostrom method – actually studying how something works, rather than asking yourself how it would work if everyone thought like you – is a powerful tonic to this, but it’s not the only one.

  17. KT2,

    I don’t agree with abandoning terms with empirical content simply because other people deny their content. “Capitalism” is a term with content. That something is not pure in aggregate does not mean it does not exist. There is no bag of refined NaCl that is absolutely pure. This does not mean NaCl does not exist. There is no “bag” of capitalism that is pure capitalism. This does not mean capitalism does not exist. Where capitalist relations predominate in a society we have capitalism. Capitalist relations certainly predominate under neoliberalism.

    The Wikipedia definition and article is basically adequate.

    I would cavil with parts of it. I don’t agree that prices are determined by markets if that term is meant to convey the meaning “free markets”. We don’t have free markets. We have manipulated and rigged markets. Prices are determined by market power (monopoly and oligopoly), administered prices (referring to monopoly and cartel administered prices here), regulatory capture and capture of politicians for policy distortion and general corruption. Profits are determined as much by escape from proper regulation and by subsidies and escapes from taxes as by the operations of anything that could be remotely called a free market.

    Late stage capitalism is a rigged and corrupt system which is destroying everything we need for survival. If it is permitted to continue on the current path it will destroy itself (and us) in short order.

  18. ” How should we conceptualise the relationship between workers, managers and owners of capital ?”

    Speaking for myself, the question presupposes a socio-economic-political conceptual framework, which results in individuals (‘people’) being assigned to (the ill defined) categories of workers, managers and owners of capital. That is, these categories become meaningful only in the context of a legal framework (eg labour and industrial relations laws, corporations laws, corporate governance and the associated courts); the institutional framework. As everybody knows, these laws do not grow in nature but are made by humans, those individuals in the category ‘government’.

    I say ‘ill defined’ categories because people who are classified as ‘managers’ and those classified as politicians will assert that they work, too. People classified as ‘workers’ will manage all aspects of their lives beyond working for a wage, hence they are managers, too. Not all work on which the society relies is being paid. And people, classified as workers, managers or politicians are also owners of capital, both physical (stuff that lasts longer than one instant of time or some habitually defined short period) and financial (savings accounts, shares, notes and coins, superannuation accounts).

    There is no unique institutional framework.

    Going back in time, one could also ask, how should we conceptualise the relationship between slaves, slave drivers and slave owners.

    Or, how should we conceptualise the relationship between peasants, landlords, and aristocrats?

    Or, how should we conceptualise the relationship between citizens, apparatchiks and the Communist Party of the Soviet Union.

    I venture to say, all these institutional environments entail a hierarchy or power relationship and none of them describe reality satisfactorily.

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