Mike Hosking Unions hitching their wagon to the past

Ideas on national wage rate and fate of TPP out of touch with economic reality

Imight have bad news for Bill Rosenberg. Bill is the Council of Trade Unions economist and the unions appear on a drive for headlines at the moment.

I note with some horror they tried to argue for national wage rates over the weekend, but more on that later.

I opened my holiday week on Monday by reading his piece in the Herald about trade deals and how the Trans-Pacific Partnership (TPP) was in its death throes.

This might be wishful thinking for Bill; he clearly hasn’t heard of the meetings later this month.

The TPP11 project is in Canada next week and the trade ministers get together on the sidelines of Apec later in May in Hanoi.

These two meetings are aimed at salvaging a deal post America’s exit.

The turning point appears to be Japan, who at one stage argued without the US there was no point in a deal at all, but now seem to have come to their senses and worked out that the 11 remaining countries represent a lot of trade and a lot of money, and 11 is better than nothing.

Whether anything comes of it, only time will tell, but it was a tortuous process to get it across the line in the first place so there’s a tremendous amount invested in still making it happen. And the beauty if you think about a TPP11 is that US President Donald Trump and his isolationist thinking won’t last forever and America can tag in another time under another administration.

The simple truth is free trade makes the world go round, this country is a pioneer in the business, and watching 10 other countries drift away from a golden opportunity is in no one’s best interests.

But back to the unions and this claim for national wages.

As I understand the thinking, it would mean if you’re a bus driver or box builder you would be paid the same no matter where you work or who for.

I suppose I admire the cheek.

I guess in election year everyone is entitled to have a go at pushing a barrow, even if the barrow comes from 1971.

But the concept that as an employer of bus drivers or box makers you get told what you can pay is so absurd I’m surprised the perpetrators of the crime can argue it with a straight face.

Making it worse, it is reported Andrew Little likes the idea, mind you given his union credentials perhaps that should not be a surprise.

But I would have thought having stepped into the new role of Opposition leader with the task of dragging your party into the real, if not modern, world, you might want to leave a few of the more fringe ideas behind. What Labour must do this year is look credible, and if they think nationalising wages is credible then we can assume they’ve been taking tips from Jeremy Corbyn, who will be giving them all the food for thought they could want on June 8 by leading his party to a broad-based collapse based on the fact he fails to accept communism isn’t a votegetter. Wages are based on a variety of circumstances, and the main one isn’t what the Government or unions tell you to pay. It’s location, product, profit margin, market size, competitiveness, experience, labour availability, the economy, the list goes on. That the unions don’t grasp the basic economics of this should be a worry to us all. Perhaps the upside here partially is most of us do get it, hence the vast majority of us no longer belong to unions. If these ideas on free trade and national wage rates are their idea of some sort of recruitment drive, they’re going to have plenty of spare time on their hands.