Swan flags salary caps as the ACTU come out swinging

I’m certainly relieved that the Rudd Government have hit back.  It will also be interesting whether Pacific Bonds will pull their heads in and try any alternative options available and in consultation with various other stakeholder before committing to their slash and burn strategy for reducing costs.

Swan flags cap on executive salaries

EXECUTIVE salaries had reached “sickening” levels, Wayne Swan said today, as he warned the Government is considering a cap on bosses’ pay.

The Treasurer said the Government was exploring all options when it came to high salaries for executives in businesses where staff were being laid off.

“I think Australians want to see a fair system for all and I think they are rightly sickened when they see some executives walk away with large payments and many workers walk away with virtually nothing,” Mr Swan said.

He was speaking in Melbourne ahead of crisis talks over the planned sacking of 1850 workers at clothing manufacturer Pacific Brands between the company, unions and Industry Minister Kim Carr.

Barry Tubner, state secretary with the Textile, Clothing and Footwear Union of Australia, said it was the first time Pacific Brands had agreed to sit down with its workers and their representatives to explain how it had reached its decision to make mass retrenchments.

The ACTU have also come out fighting

Published: 27/02/2009
There are worrying signs that some large businesses are using the current financial crisis as a cover for unnecessary job cuts say unions.
ACTU President Sharan Burrow said that some companies are trying to maintain short-term profits at the expense of workers’ jobs and the long-term viability of local industry.

Unions are calling on the big businesses that have announced job cuts this week — including Pacific Brands, Lend Lease and Telstra — to urgently reconsider their decision and delay or call off the job cuts.

“It is unacceptable for some large businesses, including the banks, to put short-term profits ahead of the lives of workers and the future of local industry,” Ms Burrow said.

“Companies that are still making profits or paying exorbitant salaries to executives should not try and take the easy way out by slashing jobs.

“Now is the time for employers to act wisely and think about the long term. They should not rush to slash jobs that will destroy capacity for when better times return.

“Where possible, any decision to cut jobs should at least be delayed until the economy recovers and the job market improves.

“Many of these companies have received a lot of taxpayer support in recent years and should be repaying that support with greater loyalty to staff.

Pacific Brands received more than $15 million in the past two years and Lend Lease has also benefitted from major publicly funded or underwritten infrastructure projects in recent years.

Ms Burrow added that banks and institutional investors should not be putting pressure on companies to slash jobs as a cost-cutting exercise in the current economic environment.
Ms Burrow said reports that Pacific Brands was forced to make job cuts as a condition of its bank loans being extended were very disturbing.

Over to you

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91 Responses

  1. The pay scales of many people represented by Sharan Burrow’s organization are well known. May we know how much Ms Burrow is paid. May we also know if she considers it wise and safe to chase cars.

  2. I always love a good secondary boycott.

  3. Okay, so too many in the union movement are overpaid underachievers I agree. But without them their is really nobody to stand up for workers.

    By the way Stephan how much does Burrow’s get paid or is it a red herring you’re throwing?

  4. I know I get confused at times with the use of ‘there’ and ‘their’
    Covering my arse, just in case the word police visit this post

  5. Sharan Burrow’s salary? Bet its not even remotely close to a million bucks or even half a million.

    Diviuge the secret Stephan.

  6. Nothing will happen, just more politician’s rhetoric.

    Our government (and opposition) do not represent the people…they still represent The Robber Barons…we deserve a weak government because we don’t COMPLAIN…I’ve seen people in restaurants get the wrong order and say, “…nah, its alright…”

    …pollies have learnt to keep us complacent with BS…

    …if we could see this happening three, four years or more ago, I’m sure they could…

    …”royalty” isn’t just about being born a twit – its about thinking you’re one too…

    …corporate arrogance is too nice aphrase for these people…

    …they destroy the image of well run organisations as well…

    JMc its simple, just use their when referring to people.

  7. TB

    JMc its simple, just use their when referring to people.”

    Do you have something simple but no matter how hard you try it always seems to get passed you TB? I always have to stop and think yet I know “its simple, just use their when referring to people.” Lol

    re your other comments – Deep down I remain a cynic as well, but one never knows ‘miracles may happen’

  8. Well said TB.
    N’

  9. N’ and TB

    I’m surrounded by cynics, does nobody believe in magic or miracles anymore? (lol)

  10. John:

    Their = belonging to someone such as Their socks.

    There = as in There you go. It’s a statement.

    They’re = They are.

    Mind you I am mathematically challenged so don’t anyone tell me how easy numbers are.

  11. Thanks Min

    Whenever I do it yourself, TB and N’ all have permission to pick me up on it (wink) Please?

  12. John I do want to know how much Ms Burrow is paid. Yes, I agree that the workers should be represented by people who are dedicated. They aren’t all like that. Take our very own ex-Unions NSW John ‘Donald Trump’ Robertson. He was against the partial privatisation of our electricy body (I agree) saying it would lead to job losses. Now that he has moved into politics he sees the sense in privatising two prisons (Cessnock and one other) which will lead to job losses. Apart from that he wanted $500,000 spent on refurbishing his ministerial office in Donald Trump Tower. I’ m thinking the head sherangs in the union movement must be used to large salaries.

    How much does Ms Burrow get paid to look concerned.

  13. TB & John McPh,

    Speaking of simplicity, I’m always reminded of the historical fact that NASA spent millions of dollars developing a ballpoint pen that would write with ink in zero gravity.

    The Russians? They gave their astronauts a pencil.

  14. “know I get confused at times with the use of ‘there’ and ‘their’”

    Happens to me too John when I’m writing fast.

    No problemo…we know you have a top notch brain working overtime.

    XTC – Senses Working Overtime

    N’

  15. Reb

    “Speaking of simplicity, I’m always reminded of the historical fact that NASA spent millions of dollars developing a ballpoint pen that would write with ink in zero gravity.

    The Russians? They gave their astronauts a pencil.”

    That is something I had never thought about and yet it’s quite profound. In fact, imagine if the financial wizards who created this whole mess had kept this one thing in mind…no forget it, there’s no squillion dollar bonuses to be made in simplicity ( lol)

    N’

    “know I get confused at times with the use of ‘there’ and ‘their’

    And I thought I was the only one. I feel better now (wink)

  16. Stephan

    “Take our very own ex-Unions NSW John ‘Donald Trump’ Robertson. He was against the partial privatisation of our electricy body (I agree) saying it would lead to job losses. Now that he has moved into politics he sees the sense in privatising two prisons (Cessnock and one other) which will lead to job losses. Apart from that he wanted $500,000 spent on refurbishing his ministerial office in Donald Trump Tower. I’ m thinking the head sherangs in the union movement must be used to large salaries.”

    Robertson is probably one of my least favourite people along with whole NSW state government.

    I can’t find the will to come at you with a contrary opinion Stephan.

    You say “I agree that the workers should be represented by people who are dedicated. They aren’t all like that.”

    You win, no argument from me.

  17. Thar, now you know how it works Johnno, I’m off to pub over thar

    8)

    N’

  18. Enjoy N’

  19. I was picking my nose earlier and it got me thinking, privatisation of gaols is the dumbest thing any decision maker can do.
    Rehabilitation or isolation is my only answer, when your in jail its because your choices are crap. The governments have painted themselves into a corner, they spoil prisoners with all the facilities a resort should have and all the rights a free person has while in gaol it becomes so expensive to maintain they sell it off/get rid of it/give up.

  20. I thought that what stephan wanted to convey was that Burrow looks (& by extension acts, ie chasing parked cars) like a dog; & that the rest was just tossed in to appear to be deceptively intellectual.

    Then I read his subsequent explanations. They are difficult to fault,

    I like stephan’s subtle hooks & nets. I think that there is a sense of humor giving me the finger somewhere in there. lol.

  21. There are so many subjects, i ‘m lost to what comment i was commenting too and which blog.

    regarding the gaols.

  22. Re this Robertson person, there was a report in the Adelaide Advertiser a couple (or more) weeks ago about the refurbishment.

    According to the report, refurbishment of ministers’ offices is scheduled every few years (I can’t remember how often, exactly) and was due for it’s periodic refurbishment to the tune of $500,000 at the time that he took over and that he’d vetoed it.

    The report went on to say that the veto wasn’t as a response to public pressure, but because he said the office was fine as it was and hunted out the painters and decorators.

    Him knocking back the refurbishment of his own volition was the reason the story made it into an interstate paper, because it was so unusual.

  23. jane, see on “invisible Hands…’ thread::

    nasking, on February 27th, 2009 at 4:26 pm Said:

    answered your kind query there re: dinner.

    Thnx for kind comments re: my Dad.
    N’

  24. PREMIER Nathan Rees has bowed to public pressure and cancelled a half million dollar makeover of Prisons Minister John Robertson’s office.

    It was an embarrassing backdown for the Premier who also banned ministers spending any money on their offices apart from urgent repairs and maintenance.

    http://www.news.com.au/dailytelegraph/story/0,22049,25091879-5013110,00.html

  25. Former bosses back in business to make a killing

    FLUSH with funding from redundancy deals and golden parachute payouts, former business high-flyers are returning as corporate undertakers, using the skills and networks honed during the boom years to profit from the bust.

    In some cases, members of a growing army of insolvency consultants are being paid to clean up a mess they helped create…

  26. Kitty

    It’s rarely you’ll see this but even the DT’s come out swinging and are firmly in support of unions

    Editorial: Standing by the unions
    http://www.news.com.au/dailytelegraph/story/0,22049,25115612-5001030,00.htm
    AT The Daily Telegraph, we take a fair approach to industrial issues. This means we view each industrial matter on a case-by-case basis.

    Sometimes that will result in our opposing a certain course of union action. We have been resolute, for example, in standing against union tactics that unfairly inconvenience commuters or students.

    But on other issues we are happy to come down on the side of unions. The looming dispute between transport unions and Pacific Brands is a such case.

    To briefly summarise matters as they stand: transport unions plan a national blockade to prevent shipment of manufacturing equipment to China, where they will be used to make underwear bearing the Bonds label.

    Ordinarily, we would support the rights of companies to run their operations out of any location they wish. After all, it’s their money; let them do with it what they will.

    Yet Pacific Brands is moving their operation overseas in the wake of grotesque payments to its bosses. They are using the excuse of low profit margins in Australia as a trigger to start over in a job market where wages are lower.

    And while they’re doing that, Pacific Brands bosses are rolling in cash. Apparently manufacturing in Australia is so dire that everyone on the board at Pacific Brands is earning an absolute fortune – including raises only last year.

    Their move to China is against the national interest as we face economic stress. Just when we need employers to stick with us – as Australian workers, consumers and taxpayers stuck by Pacific Brands – they up and run. Let’s see how far they get. We say: Bring on the blockade.

  27. Bring on the secondary boycott! Do something illegal to prevent a decision that was legal.

  28. John from the bit that I’ve read/understand the rationale behind the blockage re removing machinery is that Pacific Brands purchased this via grants courtesy of the Australian taxpayer and so ethically this machinery still belongs to the Australian taxpayer.

    ps anyone apart from yours truly fed up with those videos that jump out at you from news sites.

  29. Absolutely Min. They are starting to annoy the crap out of me, and they’re not just confined to news sites, although news.com is a big culprit.

  30. Migs..all of the Fairfax sites are also big culprits. Half way through reading and a wretched advert leaps out at you. You then have to find the incey-wincey little x to get rid of the stupid thing. It then retreats Stage Right with a query Replay Video. Blankety-blank, I didn’t want to play it in the first place!

    And the ones that swirl around the screen are fairly impressive also.

  31. Tom of Melbourne, on February 28th, 2009 at 10:24 am Said:

    Bring on the secondary boycott! Do something illegal to prevent a decision that was legal.

    What is illegal about what the unions are proposing?

    Isn’t it their right to decide what they move and what they don’t? Isn’t it their right to allow what they want on union controlled docks (if there are any left, thanks howie)

    It may not be ‘ethical’, but neither is receiving millions in tax-payers money, buying machines, and shipping them overseas.

    Mind you, the threat alone my have born some fruit, scant though it may be

    Industry Minister Kim Carr asks Pacific Brands to stay in Australia

    And as to the popup adverts, they may be pesky, but I consider it worthwhile for reading the paper for free. As long as they remain easy to close.

  32. Too true Tom R. If the newspapers decided to get tough then we would all have to walk down the street to buy them 😉

    I am convinced that those machines will be staying exactly where they belong, in Australia.

  33. “Tom of Melbourne, on February 28th, 2009 at 10:24 am Said:

    Bring on the secondary boycott! Do something illegal to prevent a decision that was legal.”

    How many laws do we have that are complete bollocks? Companies have access to armies of legal teams who spend their time exploring for loopholes in laws Frankly, I’m all for stepping over the line when necessary.

    Tom, my life for the last five years has been about being trapped in a legal quagmire and a living hell because certain laws are open to exploitation by my former employer and their insurer.

  34. Secondary boycotts occur when a union takes action against an unrelated organisation. Such as is being proposed in this case.

    If the machinery has been funded by the government, then the government or even unions (!) should seek an injunction against its removal. I think in the current circumstances an injunction would probably be issued. I suspect that it would not be required, as Pacific Brands would probably provide a form of enforceable undertaking to the court.

    When organisations ignore the law, this is usually regarded as the action and behaviour of vigilantes. I’d be surprised if vigilantes had a particularly good reputation with most contributors here.

    I’d prefer to encourage lawfulness in the way organisations in society conduct themselves.

  35. “We say: Bring on the blockade.”

    Yes, motivate the Unions to go full-bore in this instant…get them hot-headed & in fighting mode…so then other News Ltd types & the LIBS can BASH the Unions for over-reacting down the road…& ring the headline alarm bells:

    “Pushy Unions return to bad old days of bullying business”.

    “Unions controlling as Rudd stalls”

    “Union protectionist approach could kill trade, increase inflation”

    blaah, blaah, blaah

    Reminds me of the Thatcher era in the UK…willy buggers everywhere.

    However, it probably also indicates that the Murdoch media is reading the populist tea leaves, desperate for attention, to increase ad revenue, times are getting tuff over in America these days. When Rupert comes out and apologises for a NY Post cartoon you know things aren’t going all this media empire builders way…& the debt needs to be paid for WSJ & Dow Jones.

    Still, why kick a gift horse in the mouth eh?

    And I do reckon the some of the Unionists are playing their cards right.
    N’

  36. From good old Wik..A secondary boycott is an attempt by labor to convince others to stop doing business with a particular firm because that firm does business with another firm that is the subject of a strike and/or a primary boycott.

    As far as I can see there has been no attempt by the employees of Pacific Bonds to try to influence other unions. Rather that this is an independent decision by these unions.

  37. Why would anyone suggest any form of boycott, secondary or otherwise, when a simple injunction would probably achieve the same outcome?

    I think a sense of retribution, rather than pursuit of an outcome, is the explanation.

  38. TomM

    Even though, fom my link, the sense of retribution has created some form of an outcome??

    Without any alleged ‘illegality’

    Actions do speak loudly,. Louder, even, than BOO!

  39. Wouldn’t now be a good time for China to boycott Australian businesses in China in retaliation for Australian unions blocking Chinese employment??

  40. Legion,

    A secondary boycott by China on Australian goods and services? (I think I know who would have the most to lose.)

  41. Actions do speak loudly,. Louder, even, than BOO!

    I’d like to see some real action, let’s get serious and militant, stop accepting whatever they dish out.

    Pacific Brands – turn anger into action:

    Only strike action by all Pacific Brand employees – the 1850 sacked and the remaining 7000 – can save the seemingly ‘doomed’ jobs and wipe the smile from the greedy. All Pacific Brand workers could occupy their workplaces until PB agrees to stay, or the Government nationalises them, without any job losses.

    And Sharan Barrow, instead of the sideshow about the obscene pay company directors receive, should organise the big battalions of the union movement to black ban PB until it guarantees that all workers will keep their jobs. Or until Rudd Labor agrees to nationalise the company and secure every job.

    The TWU could lead the way by banning the movement of any Pacific Brands goods within Australia, effective immediately. What about it TWU?

    The main game is with Pacific Brand workers. Only strikes and occupations have any chance of saving your jobs.

    And if you did strike and occupy, hundreds of thousands of workers across Australia would support you industrially until you won.

  42. “let’s get serious and militant, stop accepting whatever they dish out.”

    I used to think same in England kittylitter…then I saw how the Murdoch media & others, including Thatcherites used it against the striking miners…it was sad to see:

    UK miners’ strike (1984–1985)

    The miners’ strike of 1984/1985 was a major industrial action affecting the British coal industry. It was a defining moment in British industrial relations, and its defeat significantly weakened the British trades union movement. It was also seen as a major political and ideological victory for Margaret Thatcher and the Conservative Party.

    Public opinion and the Media

    Public opinion during the strike was divided and varied greatly in different regions. Overall, the government generally had more support than the miners.

    When asked in a Gallup poll in July 1984 whether their sympathies lay mainly with the employers or the miners, 40% said employers; 33% were for the miners; 19% were for neither and 8% did not know. When asked the same question in December 5 – 10 1984, 51% had most sympathy for the employers; 26% for the miners; 18% for neither and 5% did not know. When asked in July 1984 whether they approved or disapproved of the methods used by the miners, 15% approved; 79% disapproved and 6% did not know. When asked the same question in December 5 – 10 1984, 7% approved; 88% disapproved and 5% did not know.

    In July 1984, when asked whether they thought the miners were using responsible or irresponsible methods, 12% said responsible; 78% said irresponsible and 10% did not know. When asked the same question in August 1984, 9% said responsible; 84% said irresponsible and 7% did not know.

    The media at the time however made no serious attempt to cover the NUM’s economic arguments until after the strike had ended.

    The government’s public relations machine and the NCB worked closely with the establishment and had access to effectively unlimited resources which had the effect of suppressing these economic arguments. Towers, writing in the Industrial Relations Journal immediately after the strike in 1985, gives several explanations as to why this occurred. “One explanation … was the obsessive reporting of the ‘violence’ of generally relatively unarmed men and some women who, in the end, offered no serious challenge to the truncheons, shields and horses of a well-organised, optimally deployed police force.”

    Socialist groups also claimed that the mainstream media deliberately misrepresented the miners’ strike, saying of The Sun’s reporting of the strike: “The day-to-day reporting involved more subtle attacks, or a biased selection of facts and a lack of alternative points of view. These things arguably had a far bigger negative effect on the miners’ cause”

    Thatcherite king of the tabloids: the 1980s
    The Sun’s sale grew and grew during the 1980s and the paper became increasingly brash under the editorship of Kelvin MacKenzie. Bingo, introduced in 1981, was a key driver of the circulation rise.

    In 1986 Murdoch shut down the Bouverie Street premises of The Sun and News of the World, and moved operations to the new Wapping complex in East London, blocking union activity and greatly reducing the number of staff employed to print the papers; a year-long picket by sacked workers was eventually defeated (see Wapping dispute).

    MacKenzie’s Sun was an ardent supporter of Margaret Thatcher and her policies, and maintained its support for the Conservatives when she was succeeded by John Major in 1990.
    ———
    Think about whose paper is urging the Union on this time kittylitter. Reckon it’s a TRAP. Think about who owns most of the print papers, some blogs/internet sites…and part of SKY Australia.

    Just saying.

    N’

  43. BTW, info on Miner’s strike & The Sun paper was from Wikipedia.
    N’

  44. Talking about corporate greed, I’ve no doubt that the Millionaires Factory, Macquarie Bank’s private equity strategy is toast.

    Battered ‘n’ bruised
    February 28, 2009
    http://business.smh.com.au/business/battered-n-bruised-20090227-8kbl.html
    While no one is game enough to predict Macquarie’s demise, the global economic downturn is forcing the group to rethink its famed business model, writes Lisa Murray.

  45. That’s a very well researched and reasoned article Kittylitter – “The TWU should keep the present bans in place until the company re-hires all its workers” … “or forcing Rudd to nationalise the company.”

    Has anyone actually been retrenched yet? Nationalise a sock manufacturer?

    Is he really serious or just playing with us?

  46. Tom of Melbourne
    Nationalise a sock manufacturer?

    More than just socks or socks and jocks (Bonds) Tom:

    Dunlopillo (Pillows, mattresses, doonas)

    Actil (sheets, towels, bedlinen)

    Hard Yakka (Shorts, Overalls, etc)

    Grosby & Hush Puppies (shoes)

    Stussy, Mossimo & Hang Ten (Clothing)

    Wrangler & Lee (Jeans)

    Slazenger (Sportswear)

    Repco (Bikes)

    Style Corp (Uniforms)

    From their website:

    “People not only wear our brands, they sleep on our brands and accessorise their homes with our brands.
    They play sport, go to work, dress their children and relax in our brands.
    Every day.
    Every week.
    Every year”

    The uniforms regulated by the organisation for whom I work are supplied by Style Corp – over 5000 employees in one building.

    Check out their website for yourself to get a sense of the scale:

    http://www.pacificbrands.com.au/default.asp

  47. Addressing a couple of different issues raised here:

    Burrows would not be earning more than 10% of the salary of Pac Brands CEO (ACTU staff are the paupers of the union movement for sure). What is astounding is how much people have bought the “outrageous pay hikes” story re: Pac Brands. The CEO position did NOT get a 170% pay increase last year. In fact ,the CEO position paid considerably less, as the current CEO earns less than the outgoing one. The 170% calculations being bandied about is the increase received as Sue Morphet shifted from her previous role into the CEO share. She earns almost half a million less than her predecessor – where’s the fury about a woman being paid less??

    As for wanting to recoup the government moneys handed to Pac Brands, I will be intrigued to see how this precedent would play out in future. As I’ve said elsewhere on this blog, Pac Brands has lobbied hard over the years (in vain) for TCF tariffs not to be cut. Much of the grants mentioned should be seen as compensation/adjustment payments to compensate for cuts. This move overseas is the last step in the adjustment. The government cannot in any honesty claim they didn’t see this as the likely outcome – it’s what the trade theory told us would happen.

    As for recouping the $17m, i suspect the machinery in question might be worth a bit more than that – so should the unions only ban some of the shipments??

  48. Of course RN, each one of those consumer goods (sheets, underwear, shorts AND socks!) is vital to our very own way of life. It’s a great idea to have the government finance and run this essential industry. That’s bound to make us all better off.

    Finally a simple answer to our economic woes.

    Nationalise them NOW!!!

  49. I did check out the website RN. I was looking into my personal boycott of products. The brands and the merchandise that they market is huge. I would think that all Australians would be affected in some (not so small) way.

    PB was already a profitable organisation.
    This re-location is all about opportunistic and predatory corporate greed. This company has just shit on the loyal aussie workers and customers who have assisted, supported and sustained them in making their profits over the years.

  50. That’s a very well researched and reasoned article Kittylitter

    Why thank you tom, I think so too.

  51. She earns almost half a million less than her predecessor – where’s the fury about a woman being paid less??

    Yes, I knew that Andre and I was thinking the same until I read that the whole re-location thing is down to her.

    Is she getting the big increase now because she’s prepared to prostitute herself for more money and become the ‘fall gal’ for this company, whilst the other heroes hide behind her skirts?

    If, as the press says, this restructure is the result of HER internal investigation and HER recommendation – then she can have the bucket tipped over her IMO.

  52. Perhaps we should re-erect huge tariff walls around everything so that the well-off can start going on shopping holidays to Asia again. Ah the joy of rubbing your cheap Seiko watch price in your family’s faces ‘cos they couldn’t even afford a passport, let alone a plane ticket. Those were the days!

    Of course if we bring back protectionism, airfares will rise by a factor of about 5 but at least the fortunate few will have guaranteed jobs for life once again.

  53. Just pointing out Tom that PB is not a sock manufacturer. I would go as far as to say that every Australian household would be using PB merchandise to some extent even inadvertently. I was unaware of their scope before I checked the website.

    Why must it always be about shareholders profit? Surely the company owe all Australians on many, many levels for what they are today?

  54. If, as the press says, this restructure is the result of HER internal investigation and HER recommendation – then she can have the bucket tipped over her IMO.

    Agree kittylitter! Moreover, this woman referred to the workers as “clutter” and that they should be grateful for their employment in the first instance – that really gets up my nose.

  55. My thanks to kittylitter for republishing one of my pieces from my political blog En Passant on nationalising Pacific Brands.

    One reader mentioned the media and the miners strike. I think the miners in 84/85 in Britain failed because other unions (like steel and railway) refused to back them. The defeat of the miners laid the groundwork for the further success of Thatcher. (The miners’ victory ten eyars before helped Labour win.)

    Tom of Melbourne says:

    ‘That’s a very well researched and reasoned article Kittylitter – “The TWU should keep the present bans in place until the company re-hires all its workers” … “or forcing Rudd to nationalise the company.”

    ‘Has anyone actually been retrenched yet? Nationalise a sock manufacturer?

    ‘Is he really serious or just playing with us?’

    Thanks for the compliment about a well researched article, Tom, and yes I am serious. Waterford Crystal workers in Ireland have done exactly that. they have occupied and demanded the Government nationalise the company or allow it to be sold with no loss of jobs. (Waterford crystal is an Irish icon.)

    Why can’t Pacific Brands workers do and demand the same as the Irish workers? Something like “Rudd, we are on strike and occupying the PB factories and offices until you nationalise Pacific Brands to save all our jobs.’

    That appears to me to be a strategy that has more chance of saving their jobs than giving up without any fight.

    And my apologies to Sharan Burrow. I mistyped her name in the article. Pushing the wrong barrow I guess.

    Has anyone been sacked, Tom asks. Yes. 1850 have been told they will be. Not sure which day they are supposed to finish up on.

    The company may back down a little if Carr buys them off. While any saved job is important, all the 1850 jobs need to be guaranteed safe. If not then the workers need to take strong action – all of them (including the other 7000 PB workers) should strike and occupy the factories and offices.

    Tom is right about secondary boycotts. Bad laws are meant to be broken, and I suspect if anyone did prosecute the TWU, MUA or other unions involved in banning removing machinery offshore, the unions would or could mount a huge industrial campaign against the laws, with massive public support. (I think people now hate PB so much they will see this as part of that fight.)

    But the ban, as I argue in one of my articles, may be useless since there is no evidence (according to Michelle Grattan) that the company was going to take the machinery with it.

  56. Welcome John

    A little of the current topic but you seem like a person who may have some idea as to whether the following quote was in fact written by Karl Marx. It’s been doing the rounds of late and of the opinion its wording is too contemporary to have been written in 1867.

    “Owners of capital will stimulate the working class to buy more and more of expensive goods, houses and technology, pushing them to take more and more expensive credits, until their debt becomes unbearable. The unpaid debt will lead to bankruptcy of banks, which will have to be nationalized, and the State will have to take the road which will eventually lead to communism.”

    – Karl Marx, 1867, Das Kapital

  57. RN, on March 1st, 2009 at 3:34 pm

    Did she call the workers clutter? Or the whole organisation, its branding structures, value chains, and its work flows? If the materials are already being spun in China, what sense does it make having inputs and throughput separated by thousands of kilometres except as a waste of finite energy resources? Why wouldn’t it be in Australia’s national interest to have the 1850 go to work as part of the new 7000 at Woollies, or prepping the pink-batts, and not continuing to pour public moneys into an industry tailing off into an inevitable oblivion for which there is no ‘creative destruction’ dividend whatsoever?

  58. John McPhilbin, on March 1st, 2009 at 4:50 pm

    I don’t see how that will be achievable on those premises, John, while everyone is still talking about jobs and wages; even credit is subsumed within capitalism as a de facto, inter-temporal wage component, and nationalising banks seems designed to entrench capitalism, not have it wither.

  59. Legion

    I understand your point Legion. You’ll note I’m simply asking John a question about the authenticity of a quote. It seems to me he may be more knowledgeable than I on the subject.

  60. LOL John even though Megan McArdle says it too, it’s a fake (see http://meganmcardle.theatlantic.com/archives/2009/01/faux_marx.php). I suspect some not-too-bright wingnut thought it up to give roundabout support to the ‘Obama is a commie’ meme.

    Sorry for the oxymoron in ‘not-too-bright wingnut’ :).

  61. Now I know you are playing with us. Waterford Crystal is the Irish version of our very own cotton interlock manufacturing?

    Ah yes, the tradition, the passing on of skills from father to son, “this son is how you set up a cotton interlocking machine, push this button, and then sit down for a while”.

    I agree they’re identical cases. Though if that is a fact, we’re more stuffed than I thought.

    Retrenchment applies to individuals. I suspect that PB will eventually dismiss or retrench fewer than 1850, but I’ve always been a strong supporter of local industry and local jobs.

  62. Sorry for the oxymoron in ‘not-too-bright wingnut’ 🙂 .

    Love it Ken, had a good laugh

  63. Ken Lovell, on March 1st, 2009 at 5:22 pm

    They can’t be too lacking in wattage…the author appears to have managed to include 60s and 70s psychology stimulus-response refs, to incorporate a peculiar variant of Marx’ thesis that capitalism will be wracked by periodic crises of over-production and under-consumption, all while ‘simulating’ a path for communism completely at odds with Marx’ inability to detail one, or even a socialist precursor on those terms.

  64. And just another stray thought…why does progressive income taxation just end with a top marginal rate at c.$180k under some idee fixe about flattened tax structures when salaries obviously aren’t ‘flattened’ beyond that near arbitrary point?

  65. Thanks Tom of Melbourne

    You say about my argument that I am playing with you. You say ‘Waterford Crystal is the Irish version of our very own cotton interlock manufacturing?’ and imply that I think WC workers are the same as PB workers.The logic of your argument escapes me.

    Different workers in different industries in different countries are still workers – selling their labour power to a boss to survive. so the actions that one group of workers in one country take can give a lead to another group of workers under the same threat – loss of their jobs.

    Perhaps you could address my arguments in future rather than attacking the straw men of your imagination.

    I do agree with you that PB may sack less that 1850. They are evidently in discussions with Kim Carr, the relevant Minister. From reports it may be that Kim Carr will convince them to save a couple of hundred jobs. The soft left and Labor will, if it happens, hail this as a great victory.But that’s still 1400 or 1500 to go. One sacking is one too many.

    And all this faux outrage about executive salaries is cover for Labor and the ACTU and other unions to echo community anger while doing nothing or very little to save all the 1850 jobs.

    John McPhilbin, I don’t know about the supposed Marx quote. It doesn’t read right. I’ll check Capital.

    I think Ken is probably right.

    I agree that nationalising banks is likely to be a step sideways, not a step forward. In fact in one of my pieces on my blog I argue that the possible Obama ‘nationalisations’ of financial institutions (and auto companies?) are the State managing the process of creative destruction for capital.

    The ‘let the market rip’ brigade would allow the US banking system to collapse and the few remaining vultures to grow healthy on the flesh and bones of the weak and dying so the whole crazy process can start again.

    Obama will probably do the same thing by linking rescue money to ‘efficiencies’, job ‘rationalisations’, technological advances, forced amalgamations, takeovers etc, and write offs of value. A ‘kinder,gentler’ creative destruction perhaps.

  66. John

    “The ‘let the market rip’ brigade would allow the US banking system to collapse and the few remaining vultures to grow healthy on the flesh and bones of the weak and dying so the whole crazy process can start again.

    Obama will probably do the same thing by linking rescue money to ‘efficiencies’, job ‘rationalisations’, technological advances, forced amalgamations, takeovers etc, and write offs of value. A ‘kinder,gentler’ creative destruction perhaps.”

    Agree completely, thanks.

  67. John

    Greenspan’s Bubbles: The Age of Ignorance at the Federal Reserve 2008 by Bill Fleckenstein, Frederick Sheehan is an insightful read. It demonstrates just how out of control the ‘let the market rip’ brigade have been.

    Fleckstein and Sheehan conclude by writing:

    “During Greenspan’s tenure, the creative destruction component of capitalism was routinely suppressed. The main consequence of this suppression was a loss of fear. Thus, the normal risk reduction response to periodic financial pain never occurred, as Greenspan wouldn’t even allow small crises to run their course. Instead, as people lost respect for the idea that they might lose money, risk taking continually escalated until the situation reached a point where it is now: the United States, individually and collectively, is swimming in an ocean of debt that has been rapidly ratcheting higher. At the same time, the country is experiencing a declining real estate market that supports much of that debt, a sinking economy that has been dependent on an unsustainable real estate bubble, and a weak currency. Plus, there are over $500 trillion worth of derivatives that Warren Buffett has described as “financial instruments of mass destruction.” You couldn’t have created a more precarious environment if you had tried “

  68. I can understand why any national government would wish to protect a national treasure.

    How many tourists come to Australia to buy our socks and underwear? Do the visitors tour the hosiery factory? Yep, suburban Nunawading is full of tourist buses looking at our traditional underwear manufacturing! The place is full of sock galleries, the art of undies, underwear theme cafes, the Australian tradition of socks and undies. All representing the traditional (dare I say ancient) craft of cotton interlock machining.

    And the airports! “last chance to get your SOCKS!” & “Don’t leave Australia without another pair of traditional undies”

    Get rid of the imported thongs and support our traditional socks!!!

    Just the same as Waterford.

  69. John McPhilbin

    The quote is bullshit, as Ken said. In fact the idea that ‘[t]he unpaid debt will lead to bankruptcy of banks, which will have to be nationalized, and the State will have to take the road which will eventually lead to communism” ‘ completely misunderstands Marx.

    He saw the state as arising as a consequence of class divisions, so that with the withering away of those divisions the state withers away.

    Others seem to concentrate on the word technology and say the word was not in popular use then.

    Whitney Thilson (or some such name), a value investor in the Buffet tradition, seems to have originally circulated the quote. Wall Street investment types are keen on it because it seems to absolve them from blame and maybe finger Obama as a closet commie. You know, nationalising the banks will mean stalinising society, and hey presto ‘communism’. Puerile, really.

    I’ve already indicated I think this ‘nationalisation’ stuff is really just the capitalist state controlling and mediating the creative destruction process.

    Ken said about the wing-nuts and the quote:

    ‘They can’t be too lacking in wattage…the author appears to have managed to include 60s and 70s psychology stimulus-response refs, to incorporate a peculiar variant of Marx’ thesis that capitalism will be wracked by periodic crises of over-production and under-consumption, all while ’simulating’ a path for communism completely at odds with Marx’ inability to detail one, or even a socialist precursor on those terms.’

    I’m not sure Marx was an underconsumptionist, but let’s let that go through to the keeper. The last part of the last sentence is interesting when Ken says ‘..all while ’simulating’ a path for communism completely at odds with Marx’ inability to detail one, or even a socialist precursor on those terms.’

    I’m not sure about that Ken. I thought the Paris Commune gave him a real and concrete although short lived and exceedingly immature example of workers in power, and he drew lessons from that.

    In any event I think his whole schematic approach – including workers and bosses with conflicting interests, class conflict hidden and open, possible (but not inevitable) working class revolution and movement then from a workers’ state all the way eventually through to communism – makes a lot of sense.

    Tom, icons can have different roles. In Australia I would have thought for overweight beer bloated men a chesty bond is a manhood substitute and rather iconic. (Where is my chesty bond singlet, by the way? And please don’t twist my satirical words. Damn it. Now you’ve got me wondering if retailers do sell singlets at international airports. Do they? God, the debate has moved to your terms.)

    .

  70. “Perhaps we should re-erect huge tariff walls around everything so that the well-off can start going on shopping holidays to Asia again. Ah the joy of rubbing your cheap Seiko watch price in your family’s faces ‘cos they couldn’t even afford a passport, let alone a plane ticket. Those were the days!”

    lol…too true Ken. But wouldn’t it be beneficial to reduce flights for carbon reduction reasons? Perhaps try & connect us w/ our neighbours in other ways…such as building a mass inter-connected railway, bridge, ferry system to Asia and introducing a Eurorail style pass?

    Tho. I guess the distances are shocking here…the infrastructure cost enormous…& business travellers & short trip holiday-makers want their travel time reduced to least hours as possible (thinking of Heathrow in UK expansion regardless of Chunnel)…& some areas towards Indonesia are not too stable at times. And perhaps some Aussies enjoy their sense of “isolated island”…and perhaps I’m answering my own freakin’ question…
    🙂

    I travel so little these days we might even have the mass transport system mentioned above.

    I’d be interested in any views regarding “fair trade”: Considering Simon Crean has just signed a “free trade agreement” w/ NZ & other neighbour states.

    http://en.wikipedia.org/wiki/Fair_trade

    N’

  71. John Passant, on March 1st, 2009 at 8:17 pm

    We don’t want Ken’s good name tarnished with the Legion brush, especially not when important reconstruction(s) and emphases in factional Marxian thoughts vis-a-vis Marx’ own words about the structural components and functional operators of ‘crisis’ are involved, so I’ll have to take responsibility for the (mis-? disputed?) statements on that score.

    On whether Marx makes sense, he does…up until he encounters the mundane reality of a lack of (price) mechanism for registering actual human needs, and iron laws of oligarchy, and alienation in the pre-Marxist/post-Marxist liberal sense…the ‘liberty, egality, fraternity’ which preceded and succeeded the Paris Communes’ ‘democratic and social republic’. Me being me, I like to think the comrades would have sent Marx off to labour in the salt-mines instead of intellectualising about a perfectly imagined pair of shoes he perfectly imagines someone else would prefer to be making, or throwing off the yoke of a working class’ elite, err elitist capital class, dictatorship. 😉

  72. Just an addendum, John….I do understand that ‘crisis’ can refer to the specifics of particular crises, and more broadly to a crisis of legitimacy for ‘the system’ itself; obviously, my choice to focus on one dimension and not another situates my personal ‘political’, also.

  73. As I said before, I think this ostentatious outrage from Swan, Rudd, Gillard and Burrow is a furphy, designed to distract attention away from the fact they are doing (and, given their world view, can and will do) nothing to save or defend jobs.

    Workers are right to be angry about executive salaries, bonus schemes, employee share schemes, put options etc (and lenient tax treatment) but Rudd et al are using that anger to sidetrack us from the main game – defending jobs.

    Legion, I think the mechanism for deciding human needs is the democratic process of wrokers’ councils, especially in priority setting. E.g. one priority would be to feed, house and clothe all the people of the world adequately. This is a slightly higher priority than (to use Tom of Melbourne’s example) which colour underpants to produce.

    I think the Stalinists (not the comrades) would have sent Marx to the gulag. What’s the song that talks about ‘you ain’t no comrade of mine’ ? Does it go you might be a freind of Joe Stalin’s but you ain’t no comade of mine? Is Kautsky in there too?

    Anyway, I now have a vision of Marx singing (my bad memory version of?) that song to the party apparatchiks on his way to the gulag.

  74. Legion

    What are your thoughts about this idea of a crisis of legitimacy? I find on campus – I am retired and our focus is students – that there is more questioning. However that questioning is not specific, more like: I always thought you socialist were maddies, now I may want to check you out to see if your ideas make sense.

    Australia may be different at the moment since we appear to be behind the rest of the world in the decline into deep recession. But the idea that those economies more integrated into the world economy are and will suffer most should, if correct, see us accelerate into economic woe soon enough. The misery that this will impose on workers across Australia would be massive.

    Or am I being too pessimistic? Certainly the panic from Rudd and Stevenson with stimulus packages and huge interest rate cuts makes me think I am not being a henny penny.

  75. I meant Stevens.

  76. John

    “Australia may be different at the moment since we appear to be behind the rest of the world in the decline into deep recession. But the idea that those economies more integrated into the world economy are and will suffer most should, if correct, see us accelerate into economic woe soon enough. The misery that this will impose on workers across Australia would be massive.”

    Of interest may be my latest thread “China’s Implosion Could See Re-Run Of Great Depression “

  77. Thanks John. I’ll have a look.

  78. John

    I did a talk the other night on Economic Crisis: Recession and Rebellion 2009, and I hope to put some speaking notes from it on my blog later this week.

    One of the stand outs was a graph from that well known radical journal, the Australian. It had annualised growth in GDP for 2008 of various countries.

    Taiwan, South Korea more than minus 20 per cent from memory. Japan almost minus 13 per cent. Germany minus 8 per cent. the US minus 3.4 per cent. Australia plus 0.2 per cent and China plus 6.8 per cent.

    The thing about China is that the 6.8% is a fall of about 4 per cent over the previous year, and may be just the start of greater and greater declines, since about 25% of China’s economy is dependent on the world economy – especially the US and Europe.

    In other words China and Australia are headed in the same direction as the other countries, (downwards), and maybe we are only lagging about six months or so behind them in terms of the depth of the decline. That might explain the haste and magnitude of Rudd’s stimulus packages and Glenn Stevens’ massive interest rate cuts, with more to come.

    I suspect, given their actions, that their advice and analysis is that we are headed for negative growth and will be there for some time.

  79. John

    I’ll keep an eye out for your speaking notes and with your permission as I may like to run a thread referencing your thoughts and opinion for discussion. The other option may be for you to run a guest post with Joni and Reb’s permission.

    Cheers

  80. Malcolm Turnbull is getting himself into a real lather over exec salaries and payouts and other such things…but he primarily believes that shareholders should have more power to do the right thing.

    I wonder how many shares he’s owned over the years? How much control he had?:

    In 1999 Turnbull sold OzEmail to the then telecommunications giant MCI Worldcom. Turnbull’s stake was reportedly worth nearly A$60 million

    (Wikipedia)

    I’m amazed he’s not at home drinking vino w/ Tom of Melb & the like.

    Me, I’m kinda likin’ the idea of a “fat cat” tax:

    Progressive taxation is a more general strategy that affects executive compensation, as well as other highly paid people. There has been a recent trend to cutting the highest bracket tax payers, a notable example being the tax cuts in the U.S. Ex-Soviet Baltic States also have a flat tax system for incomes. Executive compensation could be checked by taxing more heavily the highest earners, for instance by taking a greater percentage of income over $200,000.
    (Wikipedia)

    Them tax cuts for the rich sure didn’t work. They fed investment gambling & failure. And now the execs are jumping ship…at taxpayer’s & workers expense. It’s SABOTAGE I tell ya.

    Let’s try the opposite. Tax the fckers more.

    Them mebbe we have a little more in the pot & don’t have to cut public SERVANTS who need to provide essential services during this era of tsunamis created by corporate greed…& their ENABLERS…the corporate media tricky dicks who pretend to give a sh*t about THE WORKERS. Rather than profits.

    and EMPIRE BUILDING.

    Thank gawd for independent blogs.

    N’

  81. Interesting how we’ve had this debate before:

    Let’s show those fat cats who’s really the boss
    SMH, Adele Horin
    August 16, 2008

    Ending the concessional tax treatment of executive share options would be a start. Hundreds of millions of dollars in share options are paid to the captains of industry but are not taxed in the same way ordinary workers’ income is taxed. The bosses can elect to pre-pay tax on 11.4 per cent of the total value of the options – and that is all they ever pay. If the share options turn out to be worthless, they can claim the tax back. In the US the gains on share options are treated as income and taxed at the top marginal rate. Until that happens here, Australian taxpayers will continue to subsidise about a third of fat cats’ extravagant packages.
    (excerpt)
    ————-
    I felt sorry for Fairfax…and the reporter seemed to be on top of it
    🙂

    N’

  82. While I very rarely agree with Malcolm Turnbull I do agree with his comment regarding shareholders to determine CEO salaries.

    Shareholders should determine not only the CEO salary but also the board and it should take a 70% shareholder vote to pass a resolution to increase remuneration. This would negate some of the massive wheeling and dealing done with large institutional shareholders before AGMs are held. Afterall large institutional shaeholders have their own boards so there could be a conflict of interest in lifting overall management wages in the whole industry.

  83. Shane, you need to be careful of what Lindsay Tanner calls unintended consequences.

    Confidential information, which couldn’t reasonably be disclosed at an AGM – like other offers received by current employees – could lead to shareholder imposed salary-caps becoming uncompetitive on the international job market, and subsequent loss of quality people to other local or international businesses, or an inability to attract suitable people.

    It’s not as simple as it sounds.

  84. This is good…we get “HIH” & Robing Hood Peter Costello & “non-binding non-binding vote of shareholders” and the “Costello VS. someone else merry-go-round” all in one 2003 interview:

    Australian Broadcasting Corporation
    LATELINE
    Broadcast: 08/10/2003

    TONY JONES: Well, as you’ve just heard the Treasurer’s proposed corporate reform bill is now a reality.

    I spoke to Mr Costello in Canberra earlier today about corporate reform, new money for Medicare and, as we said at the start of the program, about his hopes of replacing John Howard as Prime Minister of Australia.

    Peter Costello, let’s start with corporate reform.

    How would your new bill protect shareholders from future HIH-style collapses?

    PETER COSTELLO, TREASURER: I think the most important thing about the changes that we announced today is the way in which they change auditing.

    Auditing is going to be accountable now to a financial reporting council.

    Audit standards are going to have the backing of law.

    TONY JONES: One of the other things you’re also trying to address is the widespread community concern over executive pay packets.

    In the end, all you’re proposing is a non-binding vote of shareholders.

    Why a non-binding vote, and how will that change what appears to be an entrenched culture?

    PETER COSTELLO: There are two things here.

    One is we’re forcing disclosure of highly paid executives … the five top people in the company or the five top people across the group … and that will have to be disclosed in annual reports.

    In addition to that, there will be a report on remuneration where the shareholders can have a vote, a non-binding vote … this is the UK system.

    The directors are responsible for remuneration but the shareholders get to have an indicative vote, if you like.

    We saw an example recently in the UK where one of these non-binding votes was engaged and the directors got a pretty sharp message and they turned around their policies as a result.

    TONY JONES: Business here is saying you’re actually going further, in a sense, than the British and that the non-binding vote won’t, in effect, be non-binding because no board will want to go against what its shareholders are saying and therefore boards are losing power.

    PETER COSTELLO: Well, it will be up to the board.

    If I were a director, I’d be guided by my shareholders.

    Yes, I probably would follow my shareholders.

    But, if the board feels that there are strong and cogent reasons, they can take that decision.

    The authority will lie with them, but any board that didn’t take notice of its shareholders, I think, would be pretty badly advised.

    TONY JONES: Why is business so worried about this then?

    PETER COSTELLO: I think that’s probably the reason … they’d be worried that many of the shareholders won’t agree with their policies and, as a result, they’ll have to change them.

    But, Tony, the point about a company is nobody forces you to invest in a company.

    A shareholder who takes a share in a company does so of their own free will.

    If the shareholders want to approve higher remuneration because they think it will give them a good return, that’s their decision.

    We’re not stopping it as a government.

    We’re just saying, “Let the shareholders know and let them decide.”

    TONY JONES: And the companies, or the business itself, appears to be saying, “We want the situation as it applied in the past … that was free market rule. This is something different.”

    PETER COSTELLO: Well, the directors will still make the decision but, under these rules, the shareholders will know about it.

    At the end of the day, it is shareholders’ money and I think the shareholders should know about it.
    ———
    (excerpts)

    So let’s read that again::

    PETER COSTELLO: Well, it will be up to the board.

    If I were a director, I’d be guided by my shareholders.

    Yes, I probably would follow my shareholders.
    —–

    Well, that worked.

    N’

  85. So let’s read that again::

    PETER COSTELLO: Well, it will be up to the board.

    If I were a director, I’d be guided by my shareholders.

    Yes, I probably would follow my shareholders.

    Unless the board disagreed with the shareholders, as in the case of executive remuneration, then the board will do as it sees fit, for strong and cogent reasons of course – such as executive greed. In that case the shareholder vote must remain non binding.

  86. Tony you said

    “Confidential information, which couldn’t reasonably be disclosed at an AGM – like other offers received by current employees – could lead to shareholder imposed salary-caps becoming uncompetitive on the international job market, and subsequent loss of quality people to other local or international businesses, or an inability to attract suitable people.”

    I say

    I consider this type of response the reason why we now have ended up with outrageous salaries. Smoke and mirrors hidden behind the claims of confidential information and possible competitor consequences.

    If the team are performing well shareholders will vote for acceptable salary increases. If not they will not approve increased remuneration. I see absolutely no problem with this.

    I aee no unintended consequence at all, other than denying a continuation to the disgraceful situation we find companies in today.

  87. Then Shane, I say you have your blinkers on.

    Consider:

    Company A has a CEO, earning X dollars. The CEO is approached by a headhunting firm representing an overseas company, who is prepared to offer X+20%, plus all relocation expenses, childrens’ school fees, and rent on executive residence close to new company. This offer is made on the grounds that all details remain confidential.

    CEO is tempted, but would prefer to stay put. CEO approaches board of Company A, and relays the broad outline of the offer, indicating willingness to stay, even at a salary somewhat less than the headhunter’s offer.

    The board of Company A discuss the situation privately, and agree that they would be best served financially, and in the interest of stability and continuity, if they offered the CEO X+10%. The two parties agree, subject to shareholder approval.

    The AGM is held, and the board recommends to shareholders that the CEO receives a 10% pay rise. Of course no details can be given of the confidential offer to the CEO, but the board trusts shareholders will pass the motion on their recommendation.

    However, there has been much sensationalism in the media of late, in particular surrounding the Pacific Brands case, and shareholders vote down the motion.

    The CEO takes up the position offered by the headhunting firm, and Company A has to engage an international headhunting firm to engage a new CEO.
    (They have a fair idea now of the market rate, because they have just lost their own CEO to the same market forces.)

  88. Each of the public companies state that they engage external organisations to benchmark CEO and executive salaries.

    The data used by these experts use is reasonably accessible. It is hardly a secret.

    External advisors don’t recommend an actual dollar figure for remuneration. They provide several ranges, based on the market position for the target executive.

    I think that most shareholders are sensible and intelligent enough to comprehend a summary of the executive remuneration report, and understand why a board is proposing to align with a particular sector.

    This is useful information for a shareholder, but it doesn’t disclose the actual income of a CEO.

  89. John Passant, on March 2nd, 2009 at 7:44 am

    What are your thoughts about this idea of a crisis of legitimacy? I find on campus – I am retired and our focus is students – that there is more questioning. However that questioning is not specific, more like: I always thought you socialist were maddies, now I may want to check you out to see if your ideas make sense.

    John, I tend to believe that the marginalisation of ‘socialists’ as mad/deviant/different, beginning with a social relationship which names them as the Other, represents a confluence of things historical, cultural, powerful, (ir)rational, heuristic, psychological, and etc.

    I think it’s probably true to say that there should be more questioning by persons of the mediated paradigm(s) presented to them for consumption and internalisation in contemporary society, and the process of sublimation of consideration of alternatives. In radical power terms, the most effective form of power is the exercise not of overt power or covert power, but of latent(ising) power and its ability to make there seem to be no power relation involved at all.

    In terms of a crisis of legitimacy for ‘the system’, about the last thing that the powers-that-be might want questioned presently are the social relations of alienation, exploitation, and tellingly, the continued reification of money and credit, and the fetishism of money which allowed nominal surplus-value to be created by the capital class near ex nihilo and independent of any particuar labour.

    For instance, there would be no repeating or consideration in the mainstream of the ideas of a Marx who says anything like this…

    [Of] all these forms, the most complete fetish is interest-bearing capital. This is the original starting-point of capital—money—and the formula M—C—M’ is reduced to its two extremes—M—M’—money which creates more money. It is the original and general formula of capital reduced to a meaningless résumé….The land or nature as the source of rent, i.e., landed property, is fetishistic enough. But as a result of a convenient confusion of use-value with exchange-value, the common imagination is still able to have recourse to the productive power of nature itself, which, by some kind of hocus-pocus, is personified in the landlord.

    Labour as the source of wages, that is, of the worker’s share in his product, which is determined by the specific social form of labour; labour as the cause of the fact that the worker by means of his labour buys the permission to produce from the product (i.e., from capital considered in its material aspect) and has in labour the source by which a part of his product is returned to him in the form of payment made by this product as his employer—this is pretty enough. But the common conception is in so far in accord with the facts that, even though labour is confused with wage-labour and, consequently, wages, the product of wage-labour, with the product of labour, it is nevertheless obvious to anybody who has common sense that labour itself produces its own wages.

    Capital, insofar as it is considered in the production process, still continues to a certain extent to be regarded as an instrument for acquiring the labour of others. This may be treated as “right” or “wrong”, as justified or not justified, but here the relation of the capitalist to the worker is always presupposed and assumed.

    Capital, insofar as it appears in the circulation process, confronts the ordinary observer mainly in the form of merchant capital, that is, a kind of capital which is engaged only in this operation, hence profit in this field is in part linked with a vague notion of general swindling, or more specifically, with the idea that the merchant swindles the industrial capitalist in the same way as the industrial capitalist swindles the worker, or again that the merchant swindles the consumer, just as the producers swindle one another. In any case, profit here is explained as a result of exchange, that is, as arising from a social relation and not from a thing.

    On the other hand, interest-bearing capital is the perfect fetish. It is capital in its finished form—as such representing the unity of the production process and the circulation process—and therefore yields a definite profit in a definite period of time. In the form of interest—bearing capital only this function remains, without the mediation of either production process or circulation process. Memories of the past still remain in capital and profit, although because of the divergence of profit from surplus-value and the uniform profit yielded by all capitals—that is, the general rate of profit—capital becomes very much obscured, something dark and mysterious.

    Interest-bearing capital is the consummate automatic fetish, the self-expanding value, the money-making money, and in this form it no longer bears any trace of its origin. The social relation is consummated as a relation of things (money, commodities) to themselves.

    Das Kapital, Book IV, Addenda

    Is there any relationship worthy of consideration as between Marx’ ‘consummated’ and the popular additive appellations of ‘fecked’, ‘buggered’ and ‘rooted’ to economy and its present crises?

    (All just a round-about way of saying that timing is everything for crises of legitimacy and ‘exploitation’ of them.)

  90. Oh, I should add that Marx goes on to observe…

    It is thus clear why superficial criticism—in exactly the same way as it wants to maintain commodities and combats money—now turns its wisdom and reforming zeal against interest-bearing capital without touching upon real capitalist production, but merely attacking one of its consequences. This polemic against interest-bearing capital, undertaken from the standpoint of capitalist production, a polemic which today parades as “socialism”…

  91. I always thought you socialist were maddies, now I may want to check you out to see if your ideas make sense.

    Because that is what their parents and everyone around them tells the kids. This is how the dominant white, wealthy and powerful male (and those who support them and their institutions of power and greed, want critics to be labelled. They can’t be threatened by someone seen as crazy or lacking legitimacy (the movie ‘Changeling’ comes to mind as I write this, it has a similar theme).

    The corporate, religious and political powerful scream hysteria and heap scorn upon the Greens as a political group because they threaten them. They do it to the activists, those who care enough about the world to make it a better place – they are just labelled as hippies tree huggers or even worse, an unemployed, unwashed rent-a-crowd.

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