The polarized workforce

John Quiggin16 Comments

In broad terms, we know what the outcome of industrial relations reform will be. Although we haven’t had radical shifts in formal institutions, we’ve experienced a decisive shift of power to employers, and seen the results. The most obvious is polarization in working hours. There’s been a big increase in the proportion of people working more than 50 hours a week, and also a big increase in the proportion of part-time and casual workers. I think it’s self-evident that this is a bad thing, but I’ll spell out my reasons (probably over several posts).

I’ll start by observing that long hours suit some people, and so do part-time jobs. I suppose I would be the paradigm case of someone for whom long hours are not a problem. I have almost complete flexibility over the hours that I work, and almost complete autonomy over what I do from day to day, and the job is what I love doing, to the extent that there isn’t really a clear divide for me between working and not working (is writing this post at 7am work, or free time – I don’t really know). Part of the problem is that bosses’ jobs are mostly like mine – not quite as autonomous and flexible as mine perhaps, but with plenty of on-the-job rewards. As a result, bosses have always been more likely to work long hours than others. One problem with IR reform is that bosses get to impose their preferences on others, and those preferences are almost always for more effort, regardless of whether this is economically efficient or even in the long-term interest of the enterprise.

What I’m reading

John Quiggin6 Comments

Jonathan Strange and Mr Norrell by Susanna Clarke.

This is a great first novel, set in England during the Napoleonic wars, but with an alternate history in which magic was practiced until the relatively recent past, and is, as the book opens, a respectable topic of theoretical study for the upper-middle classes. This cosy arrangement is upset by the arrival of first one, and then a second, real practical magician. The result is a mixture of fairy story, historical novel and academic tome (the footnotes alone are well worth the admission price) with a total effect that is entirely new. The main action, involving the eponymous magicians, is great fun, and the subplots, which have the sinister edge of all good fairy stories, are even better.

After looking at the reviews on Amazon, I think one thing is clear. If you loved the Harry Potter books, you probably won’t like Jonathan Strange. If like me, you found Harry a pleasant read, but want something more than a readable mass-market kids book then this might be the book for you. Where Harry is Billy Bunter + magic, this is something more like Jane Austen+magic.

You can get it from your local bookshop in both black-on-white and white-on-black versions. For those who like ordering from Amazon, here’s a link or click on the picture above. This is part of Amazon’s associate program, under which I get a miniscule cut, marking my first tentative venture into blog commercialisation. I believe some people have made enough out of this to afford to buy a book for themselves.

More generational garbage

John Quiggin14 Comments

Talking in terms of generations (Baby Boomers, X, Y and so forth) is so intellectually lazy that it seems to give practitioners a license to turn their brains off, and speak almost entirely at random. Still, even at its worst, there has normally been some sort of attempt to keep the dates straight. But how about this piece from Bernard Salt of KPMG? Focusing on Generation Y, born over the 15 years to 1991, Salt says Generation Y is too hip for the Boomer humor of “Hey Hey, it’s Saturday” and goes on to observe “Generation Y humour is best encapsulated in Seinfeld.”

So Generation Y is “encapsulated” by a show about neurotic, self-absorbed boomers[1] that started its run when they were still being born (1989), and showed its last episode at at time (1998) when lots of them were more interested in collecting Pokemon cards than in watching sitcoms.

I don’t know why Salt is bothering with poor old Ozzie Ostrich. On this dating system, he could identify the boomers with Bob Hope and Bing Crosby, or for that matter with Lily Langtry and Lola Montez. Will no-one ever call a halt to this nonsense?

fn1.Seinfeld was born in 1954, three years after Daryl Somers

A revelation about the EU (crossposted at CT)

John Quiggin10 Comments

When I first read the eschatological works of Hal Lindsey and others, one of the favorite themes was numerological analysis of the Book of Revelation, in which the EU figured prominently.

And I stood upon the sand of the sea, and saw a beast rise up out of the sea, having seven heads and ten horns, and upon his horns ten crowns, and upon his heads the name of blasphemy.

At the time, the then EEC had six members, so an expansion to seven or ten (which seemed likely) would fulfil the prophecy and signal the impending arrival of the end times. The Whore of Babylon also fitted in, but I can’t remember how. The EU did have ten members between 1981 and 1986, and I remember speculating that Reagan might be the Antichrist – surviving an assassination attempt was supposed to be a crucial sign (Revelation 13:1-2). But the world did not end after all.

Now, thanks to the Economist, I discover that Lindsey was right, except for a reversal of alignment. Arsene Heitz, the designer of the EU Flag advises that it was inspired by Revelation 12:1

A great sign was seen in heaven: a woman clothed with the sun, and the moon under her feet, and on her head a crown of twelve stars.

normally taken to refer to the Virgin Mary. I’d be fascinated to see an apocalyptic Protestant response to this revelation.

Someone forgot the irony alerts

John Quiggin16 Comments

As I’ve observed before, irony is always dangerous. In my recent post about good and bad news from Iraq, I referred to impossibly cute kitten stories. This is Belle Waring’s ironic description of the kind of good news story that relies on the fact that even in the midst of war, and even under oppressive dictatorships, life goes on. Farmers plant their crops, children (and kittens) are born and play, and so on. It’s worth remembering this when we get too gloomy about the bad things that are happening but, since it’s true always and everywhere, it isn’t news. So, anyone who makes a big play out of this kind of ‘good news’ is liable to appear dishonest, or at least misleading. A good example is the scene in Michael Moore’s Fahrenheit 9/11 with Iraqi children flying kites and having fun, just before the US invasion. Moore was severely crticised for this and rightly so – the fact that children played games like children everywhere did not tell us anything about Saddam’s regime. The good news stories listed by Arthur Chrenkoff provided another example, with a story[1] which referred to “farmers tilling fields and women walking on roads. Freight trains and major highways.”

I thought that the analogy was obvious enough, and went on to the main point, which was that the election rules presented as good news by Chrenkoff seemed designed to put obstacles in the path of independents and non-government parties. But Tim Blair picked it up and solemnly advised his readers that having searched Chrenkoff’s site carefully, he’d found no mention of kittens at all – I’d made them up!. Even when I spelt out the point in detail in the comments thread, he persisted in observing that the Sweeney story was about farmers tilling fields, and had nothing to do with kittens.

But irony is a double-edged sword. Just as I wrote this the thought struck me that, rather than obtusely missing the point, Blair is ironically playing dumb to provoke controversy. If so, he has obviously managed to fool most of the residents of his comments thread, but that wouldn’t be hard.

fn1. The full story by Annie Sweeney cached here is less absurdly upbeat than Chrenkoff’s extract makes it sound.

What about the workers ?: unfair dismissals

John Quiggin48 Comments

If there’s one area where the Howard government’s Senate majority (or near-majority) seems likely to make a big difference, it’s in relation to our working lives. While the government’s commitment to free-market policies has waxed and waned, it has been absolutely consistent in representing the views of employers, whether they have demanded labour market deregulation (as in the stripping back of awards) or tighter regulation (as in anti-strike laws). The government and its supporters would, of course, claim that what is good for employers is good for employees, and there is clearly a good deal of truth in this claim. Still, there are plenty of occasions when employers and employees come into conflict (in such cases, it is more natural to refer to workers and bosses). I plan a series of posts looking at aspects of the government’s reform program, and the state of employment relationships more generally.

Of all the items on its agenda, the removal of unfair dismissal laws, at least for small businesses, is probably closest to the government’s heart. A contested dismissal is something like a contested divorce in the feelings it arouses on both sides, and the government hears all the time from the employer side of the dispute.
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That was the good news (crossposted at CT)

John Quiggin24 Comments

Amid all the dreadful news from Iraq, Australian blogger Arthur Chrenkoff has made it his mission to report the good news. A lot of the time this consists of impossibly cute kitten stories, and those repainted schools we’re always hearing about. But there is some real good news.

And, then, there’s this report on conditions for participation in the Iraqi election, linked by Chrenkoff from Iraq the model
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A backward look at productivity growth

John Quiggin4 Comments

I’ve been arguing with the Productivity Commission about microeconomic reform and productivity growth for nearly a decade. Our first round concerned prospective estimates of the benefits of National Competition Policy, aka the Hilmer Reforms. At the time these reforms were being debated, the PC (then called the Industry Commission) put out a study estimating that the reforms would permanently raise GDP by 5.5 per cent. I looked at their analysis and found lots of problems, which i discussed in this 1997 paper and also in my book, Great Expectations, and proposed an alternative estimate of 0.7 per cent.

The PC has just released a discussion draft, of a Review of National Competition Policy Reforms and it pretty much splits the difference, suggesting a net benefit equal to 2.5 per cent of GDP. It seems to me that some of the errors I criticised have been fixed either by changes to the modelling, or by the replacement of optimistic assumptions with observed outcomes. Some others remain, though. For example, all the reductions in prices for telecommunications appear to be treated as a benefit from reform even though there’s been a long-term technologically driven trend reduction of 5 per cent per year, going for many decades. In the last few years, the rate of price decline has slowed, and even been reversed.

More on this soon, if I get time.

Could Sharon save us?

John Quiggin33 Comments

The Israeli Parliament has voted to support Sharon’s plan for the removal of Israeli settlements from the Gaza strip, and also four of the least defensible settlements in the West Bank. It’s clear enough that Sharon does not intend this as the beginning of either a land-for-peace deal or a unilateral withdrawal from the West Bank. Rather, the idea is to freeze the peace process and remove the obstacles to the annexation of large slabs of the West Bank.

But events have a dynamic of their own. Sharon has broken, probably decisively, with the settlers and may well be forced to break with the rejectionists among his own supporters, such as Netanyahu. He’s going to need support for the fight against them, which will be bitter and possibly bloody. He won’t get that support for a plan based on permanent occupation of large parts of the West Bank, with a wall/barrier/fence cutting a “Palestinian entity” into a series of separate Bantustans. But he probably could get it for something close to Clinton/Barak, with two contiguous states, and border adjustments that brought most of the big “suburban” settlements into Israel in return for a trade of unoccupied land elsewhere, with or without the agreement of Arafat. This kind of policy would drive a wedge into the settler bloc, separating the ideological supporters of Greater Israel from those who just want somewhere to live in peace.

Given the long and miserable history of this dispute, a bad outcome is more likely in the short run. But, as I pointed out a while back, this is a problem with only one solution, and everyone knows what it is (to within a few square kilometres and parenthetical clauses). Sooner or later, that’s where things will end up. Since every day that this goes on adds more recruits to the ranks of Al Qaeda, I hope it’s sooner rather than later. Withdrawal from Gaza is a step in the right direction.