The author has been described by News Ltd as an "iconoclast", "Svengali", a pollie's "economist muse", and "pungently accurate". Fairfax says he is a "Renaissance man" and "one of Australia’s most respected analysts." Stephen Koukoulas concludes that he is "85% right", and "would make a great Opposition leader." Terry McCrann claims the author thinks "‘nuance’ is a trendy village in the south of France", but can be "scintillating" when he thinks "clearly". The ACTU reckons he’s "an enigma wrapped in a Bloomberg terminal, wrapped in some apparently well-honed abs."

Monday, May 9, 2011

Unions to make major wage claims before next election

So says this not-to-be-named interest rate strategist. It is a fascinating thesis that I have not seen published before. In short, Australia runs the risk of a wage-price spiral because the union movement, which was struggling under the weight of Howard and Costello before the election of the ALP in late 2007, knows that Labor are likely to lose the next election, following which they will face six years of pain under a Coalition hell-bent on minimising their influence in the labour market. The well-known strategist in question opines that the unions will, therefore, seek to push through as many ambit wage claims as possible to give their historically waning membership base wins in advance of the cold war with the Coalition. For the record, I have a lot of time for the many bright folks in the union movement, Sharan Burrow and Garry Weaven being two outstanding examples. And I think there is a role for collective bargaining, and thus unions, in the labour market, particularly where there is no tractable price and performance signal between individual workers and their employers (nursing being one example), and hence the risk of market failure.