Market balance needed

The Canadian union movement was founded in 1827 when the typographical workers in Quebec City organized. Unions were illegal until 1872 when the Toronto Globe typographical workers’ fight for a nine-hour day culminated in a demonstration of more than 2,000 workers. The fight ended with the removal of anti-union legislation and marked the beginning of the unified struggle of the workers’ movement in Canada.

Most things in life work best if they are in balance. Organized labour addressed the imbalance between private industry and labour and workers benefited. Labour unions were a good idea whose time had come but over the years the market once again became unbalanced: This time in favour of the unions. This imbalance has ripped billions of dollars out of the pockets of taxpayers. Taxpayers not receiving unsustainable public service benefits subsidize those that do. A recent example is when the taxpayers picked up the tab for unfunded defined-benefit liabilities of private-sector plans. Billions of dollars have gone to GM and Nortel pensions. Presently there is $209 billion in unfunded federal defined-benefit plans plus $150 billion provincially.

Before the unions, the markets reaped the profits while employees worked at poverty level in abysmal conditions. In general, with the advent of the union movement the principle of market vs. labour worked very well as the market (the price private industry was able to get for their product) was balanced by union demands for better pay and benefits.

As with most things in life, one shoe does not fit all. A good example of this is the financial meddling of the government in the auto industry and the subsequent billions of dollars in bailouts taxpayers have given to these companies and their highly-paid defined-benefit employees.

Another example is the pay and defined-benefit packages of public-service unions. Unions work well in private industry because market forces control supply and demand. Where unions fail to serve the public good is in government-run shops as the market price and control balance is nonexistent.

At the federal and provincial level politicians are insulated from public input by many layers including the party caucus system. Their driving force is not controlling costs; they reap the benefit of public-service benefit packages by taking those benefits to their own pensions. They know the taxpayer is a bottomless pit. They prefer to keep labour issues on the back burner and focus on getting re-elected. There is no market force to keep demands in check.

In the cities and towns, your local politician walks down your street and crosses your path on a day-to-day basis. Increasingly as the absence of market balance becomes more unsustainable, pressure is beginning to be applied across Canada at the local level by irate taxpayers over unsustainable public-sector demands that are not in the public interest.

Elvena Slump

 

Penticton