Public sector and their unions put on notice; Humourous commentary about ‘bubblebloggers’

Public sector and their unions put on notice

I can’t help but think that the coming age of Canadian austerity will likely begin in Ontario.  After right-wing, union-busting Rob Ford captured the former liberal stronghold of Toronto with a ‘Stop the gravy train’ slogan, one can’t help but wonder if the latest shot against the TTC union is more signs of building momentum.

The formerly union-friendly Dalton McGuinty declared the TTC an essential service, largely blocking their ability to hold a city ransom strike, a move that both shocked and angered the unions.  No doubt union leaders were caught off guard given how downright amicable MrGuinty has been towards unions in general and the public sector in particular in the nearly 8 years he’s been in office.

As another Rabidoux noted over at his political commentary blog, the public sector has swollen under McGuinty’s rule, outpacing private sector job growth by 2:1.  The man has also amassed the most bloated deficit in Ontario history by expanding government spending by an average of 11% per year….massively outpacing the expansion in GDP and tax revenue in that time frame.  The end result is that debt has exploded under McGuinty’s watch to the point that some economists are declaring Ontario essentially broke.

The Ontario debt situation is perhaps the least discussed major issue for Canadians.  Ontarians owe over $17,000 per person in provincial debt alone.  If we compare it to California, a state often in the news as more and more analysts become convinced of the inevitability of a default and restructuring, we find that our debt per capita is 10 times larger than theirs.  Yet while California pays a hefty price to borrow money, reflecting their poor credit rating, people are still willing to lend to Ontario for about a half a percent more than they would for Government of Canada bonds….a very slim spread relative to California, who saw their spreads reach 5% over comparable US government bonds.  It would be exceptionally prudent to take advantage of this gift from the bond market to repay as much debt as possible while interest rates are still hovering near historic lows.  Instead, we see the opposite.

So I maintain that the coming decade will be very different from the one in the rearview mirror.  I expect that austerity will be embraced either by politicians or forced by the bond market (particularly in Ontario’s case).  Higher borrowing costs amount to a defacto austerity drive as more tax revenue is diverted towards debt repayment and less is available for public spending.

Will the public sector unions hang themselves?

Also significantly, I think that the large public sector unions will need to tread very lightly in light of this.  We have an economy that is still largely fueled by stimulus in our own country, while our largest trading partner is sustaining their economy via unprecedented monetary interventions.  This will have to be unwound eventually and I suggest that the repayment process will be more burdensome than we currently realize.  Absent that stimulus, we would arguably see private sector employment under significant pressure.  Those who receive their pay cheques from the government would do well to remember who really pays their salary: the private sector.

Mike Shedlock (who is staunchly anti-union) has done a great job of following the plight of large unions in the US, where the political climate has changed markedly due to the financial crisis.  In many ways the unions are hanging themselves in the arena of public support by failing to even remotely empathize with the painful plight of many in the private sector.  It’s set the stage for the Chris Christie types to come in with a publicly supported anti-union agenda.  Those large public unions who loathed the likes of Mike Harris would do well to remember just what type of politician becomes popular when hard times for the public meet ignorant and unsympathetic demands by the unions:

In the article about the TTC, one quote jumped off the page at me:

“It starts to look like part of this continent-wide attack on working people by governments,” said John Cartwright, president of the Toronto and York Region Labour Council, an umbrella organization representing nearly 200,000 workers. “You see what’s happening in Wisconsin these days. It’s just stunning.”

John Cartwright gets it.  But in his own twisted view, he sees this as an attack on ‘working people’.  This could not be further from the truth.  And unfortunately for Mr. Cartwright and all other union leaders who have lost sight of the fact that their unions were created to protect the interests of the public at large, this is only the beginning.

Humourous ‘bubbleblogger’ commentary

Thanks once again to Mike Shedlock for posting this gem of an article over on his blog:

21 reasons to bank on the Phoenix real estate market

It’s a scathing rebuke of ‘bubblebloggers’ who the author describes as ‘living on the other side of the sewer grates’.  This was written at a time when the Phoenix real estate market had dropped about 5%.  Unfortunately for the author, his 21 reasons amounted to nothing as the market in Phoenix has now fallen over 50% from its peak.

What struck me most about the 21 reasons listed is just how familiar they all sound.  It seems that the bubbliest real estate markets anywhere in the world tend to recycle the same reasons to support their lofty valuations.  As we’ve noted before, it’s never a new paradigm…..unfortunately fundamentals will eventually matter.  So with that in mind, consider these fantastic arguments and transpose them onto some of our bubblier markets here in Canada……namely all of Vancouver and the Toronto condo market.  Given how wrong cities all over the world have been anytime that their measures of fundamental value strays significantly from their norms, it begs an important question:  Are we really that different?

The migration from the Snow Belt states to Metropolitan Phoenix has been unabated for 60 years.

Baby Boomers will retire in droves to warmer climes — the Atlantic coast, the Gulf states and the Southwest.

Just like the migration of retirees to ‘the best place on earth’ to take advantage of all their rain warm weather?

Phoenix is a destination of choice or the second-landing city for immigrants from all over the world.

Compared to the areas from which many of our in-migrants are drawn, our homes are still very affordable.

 

Funny that this was true until all of a sudden real estate prices started to melt.  While demand from ‘wealthy foreigners’ is arguably still strong in some of our bubblier markets, the reality is that in a cruel twist of fate, most of these buyers will disappear once momentum vanishes.  As Bob Farrell reminds us, the public buys most at the top and least at the bottom in any market.  So while we love a sale on consumer goods, we loathe a sale on assets like houses and stocks, instead we overwhelmingly rely on trend projection and momentum to convince us of the proper time to buy.

The entire article is quite comical in retrospect….and very telling of just how the ‘it’s different here’ or ‘it’s a new paradigm’ mentality coupled with major dislocations in fundamentals is the number one indicator that an asset bubble is underway.

Cheers

Ben


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34 Responses to Public sector and their unions put on notice; Humourous commentary about ‘bubblebloggers’

  1. jesse says:

    I seem to recall that “austerity” was the word of the year for 2010. I think it’s candidate for word of the year again this year, and will be for some years to come.

    BC, where I am, has declared many unions essential service over the years, starting about 10 years ago under the BC Liberals. The issue I have with this stance is that governments must negotiate in good faith with those deemed essential, and that often means deferring to an independent arbitration system to determine rates. That is often not done and it breeds demoralization and disincentive to work: governments end up paying less for less value when they employ autocracy.

    We have other examples too, most recently in Quebec where the crown prosecutors were striking and ordered back to work. Many simply resigned in protest, took a demotion, or refused extra work. Quebec, on this front at least, is the hallmark of austerity: their prosecutors are paid less than counterparts in other provinces.

    In one case in BC in around 2007, teachers threatened to strike and the government dusted off the old “back to work legislation and imposed contract” template and teachers went wildcat. This time, though, there was significant public support for the teachers. The government acquiesced but teachers didn’t get too much in addition to what they were promised originally, though they did get working condition improvements and guarantees. This was all at a time when the province thought it had money to spend.

    Another interesting trend is looking at the size of the public sector and its wages. Federal employees are among the best paid public sector employees when including all benefits. There has been a steady departure from the private sector in terms of average wages — wage disparity in the public sector is more stark but I fear there is a trend to highmark private sector wages by using selective examples. I see this average income disparity as the “low hanging fruit” for governments to cut, if it’s properly spun to the electorate.

  2. John in Ottawa says:

    Let’s see. The marshmallow eaters went into the private sector. The marshmallow deferrers went into the public service. Now that the public service is close to getting two marshmallows, the private sector wants the public sector to share.

    Did I get this right?

    • You lost me John. As far as I’m concerned two similar jobs should have similar compensation and benefits packages regardless of whether it is in the private or public sector. So yes, if the a private sector position pays one marshmallow while the equivalent public sector job is paid two marshmallows once benefits are considered, i’d say there is a legitimate beef there.

      • John in Ottawa says:

        OK, subtle didn’t work.

        First, there is no comparison between Canadian public service unions and US public service unions. This yet another area where it is different here.

        The average teacher only contributes 6% to their pension, whereas it is around 38% here in Canada.

        Most of the unions Mish has highlighted allow pensions of as much as 90% of salary based on the last year of service and overtime counts. Canadian pensions are typically 70% of salary based on the best 5 years salary and overtime and bonuses don’t count.

        With police and firefighters in the US, those 90% pensions cut after just 20 years.

        The American states and municipalities have dug themselves a deep pension hole that is going to be difficult to dig out of. Part of the problem is that the government hasn’t paid their contribution to the pension fund, in many cases for years.

        So, back to Canada. I don’t know of any private sector police or firefighter jobs in Canada. There are some private sector teaching jobs, but they aren’t comparable. There is a huge difference between having 35 public school kids in a room or 15 privileged kids.

        People well trained in policy and analysis get far better paid in the private sector. Assistant Deputy Ministers get paid about $250/year. Frankly, from where I sit as a guy who came up through the private sector, that isn’t much money. The security is nice though.

        One of the reasons the government has spun off so many agencies is so that they can pay enough to find well qualified staff. Even then they tend to come up short.

        Public servants get paid less, see a huge chunk of the pay taken at source towards a pension they won’t see for 35 years, and become virtually indentured for the last 15 years of their service because of the huge penalties for leaving early.

        Thus, the marshmallow issue. You can have the high salary, but no decent pension, or you can have the low salary and a decent pension after 35 years.

        I haven’t mentioned clerical pay. Let me assure you as someone who spent a career concerning himself with pay scales, in the non-union private sector we looked at pay research reports and it was the unionized clerks that we compared our pay to. If the unions couldn’t get a raise through, we didn’t give a raise either. We paid a little better on a nominal basis, but the percentage raise was based on what unions could negotiate.

      • ATP says:

        John,

        I see your point. However, here’s the issue: The researchers never had enough marshmallows for rewarding the self-disciplined crowd to begin with. They thought they would have enough based on their assumptions but they were wrong. The game is over. So, like it or not, many will not get two marshmallows.

        The older generation says: We were promised … how dare you?
        The younger generation says: We don’t have … so ***k you.

      • John in Ottawa says:

        @ATP: Yes, that is the point, but it shouldn’t be, at least not in Canada.

      • jesse says:

        @John while you may have benchmarked clerical staff to the union benchmark I don’t think that is the norm country wide. Maybe I’m wrong on this but the lower muscle and bone tiers of gov’t work look lucritive compared to the private sector. The histogram is different.

      • Lumpen says:

        John, you’ve got a wide range of points, and I’ll give you my POV on some. On others, I’m going to ask you for a reference, as either I just haven’t seen the numbers, or my figures don’t come close to yours.

        1. Differences between US & Canadian pensions, police/firefighters in US getting 90% after 20-25 years.

        Yes, they pay less in. Although you fail to mention that many of them are not inflation-adjusted, and another subset have partial protection. For the unadjusted ones, the $100k that the cop gets at 45 is still $100k at 95. What did salaries look like in the early 60s? Price levels? On a real basis, you’re probably looking at $10-20k in real spending power.

        Would you please provide a source for your 38% contribution for teachers? I’d like to see how and when it was calculated.

        2. US states / munis haven’t paid into their plans properly.

        True. And I agree that doesn’t absolve them of the responsibility. But in the US, should they be treated any differently than an insolvent private pension plan? The US has the PBGC, which is relatively generous for a failure (whether it can be sustained if a large state fails is another question).

        Canada has no pension insurance equivalent, and Ontario’s tops out at $1k/mo, IIRC. So, if the City of Ottawa (or any public institution) seeks creditor protection, should its pensioners be treated any differently than a Nortel employee who worked in the city of Ottawa? If so, why? If it should come from taxpayers, why? Did the city of Ottawa help the Nortel pensioners?

        3. Policy & analysis better paid in private sector. ADMs too at $250k.

        What kind of role in the private sector would you compare an ADM to? I would think most ADMs job responsibilities would be comparable to a VP in a single-country mid-sized organization. They’re not policy-setters, but in charge of executing policy and providing alternatives to the policy-setters. That seems pretty good to me given what I know of the alternatives in Ottawa. Perhaps less so for downtown Toronto if you’re a banker, or Calgary in energy.

        Similar question for policy & analysis – what do private analysts in Ottawa make, and what would be a typical company?

        4. Huge chunk of salary taken for pension.

        So, are you saying that you’d rather keep the chunk and deal with your own retirement? I think the plan the feds have is the best investment imaginable. I’d sell everything and put it in an investment that paid out like it does. This is another artifact of the low bond yields of the last decade – if they were at their historical averages, this wouldn’t be as big a deal.

        5. Indentured servants for last 15 years.

        Not sure why that is an issue in particular for the governments? Would that not be an issue in any DB plan based upon best X years?

    • Lumpen says:

      Why does it have to be all or nothing? PS earned what it earned, and no one is realistically talking about taking what has been earned in the past away from anyone. The discussion, IMHO, should be focused on the go-forward. Can the benefit plans of the past continue in their current form?

      Many ways to deal with it, a few possibilities:

      1. increase employee contributions for DB plan
      2. all new hires have DC plans, existing emps keep going with existing benefit plans.
      3. all new hires have DC plans, existing emps on DB plans stop accruing service and are DC going forward, still best X years for calc, even in DC zone.
      4. same as #2, except best X years calc is only for DB years.
      5. DB plans get converted to cash balance plans.
      6. DB plans get converted to DC, and employee becomes responsible for performance.

    • backwardsevolution says:

      John in Ottawa – great point! The marshmallow deferrers tend to be highly responsible, conformist types who show up on time year in and year out, very dependable people. They often will work many extra hours in order to do a good job. Perhaps they are “pleaser” types. They think of their future and are quite happy to pay into a pension, instead of taking all of the money right now. More interested in doing a good job than in profits.

      The marshmallow eaters will tell you they’ll be there, but they don’t show up. They are non-conformist types who often gravitate towards jobs where they can make the largest profits with the least effort. They really feel they are entitled to big money, and they would never be happy with deferring payment into the future in the form of a pension. They do not think about the future, but live for the day. More interested in profits than feeling they are doing good for society.

      Wouldn’t apply to all, of course.

  3. Vince says:

    Agreed the Ontario govt is pretty lucky. With all the liquidity sloshing around in global markets, discounting of fundamentals sometimes takes a long time. When it does happen, it happens rapidly. An oil collapse could serve as a catalyst for saner markets. We are very lucky that the world views us as a petro currency and does little homework outside of believing everything our banks and politicians say.

  4. Fish10 says:

    How can we ask public sector workers to take cuts when we pay our bank CEO’s $10 Million a piece.

    The contrast is even more stark in the USA, where the Wall Street cronies are pocketing Hundreds of Millions of tax-payer dollars each.

    • Dmitri says:

      I don’t have to support CEO’s bonus structure (simply by ignoring their product or services). However, I have to support public union’s pay through a threat of physical violence against my person (by the means of taxation, at the rates I’ve personally never agreed to).

      • backwardsevolution says:

        Dmitri – oh, but you do support CEO bonus structures. The big Wall Street banks have been given money by the Federal Reserve that is sloshing around the world, creating inflation. We ALL pay dearly for this. Take a look at gas prices. Some of it is increased demand, but the majority of the price increases are caused by speculation, speculation by Wall Street hedge funds.

        If houses take a nosedive in Canada, you will be paying dearly. CMHC will come knocking on the taxpayers’ doors. CEO’s have been imprudently lending to anyone who could fog a mirror, sometimes at 0% down, because, yes, they get BIGGER BONUSES. They know they can’t lose, because they will be bailed out by the Canadian taxpayers.

        We all pay for the greed of the bankers. You DO support CEO bonus structures, whether you see it or not.

  5. Don says:

    Silly arguement fish 10. There are few ceo,s and vast vast numbers of public sector employees

  6. Fish10 says:

    Is it really silly Don??

    Do you believe in equity in society, or do you believe that the majority suffer so a minority can prosper.

    If you add up the income of the top TEN highest paid CEO it adds up to the equivilent of 3000 average Canadian incomes. 10 men (they are all men) or 3000 employees.

    In the US the number is even higher, ten times higher!

    Is that silly? NO, it’s crazy.

    • ATP says:

      There is actually a common thread between the suffering majority and the CEOs: Money and Credit expansion.

      The people, including the suffering majority, always want benefits. In order to get elected, politicians cater to the people’s wish and spend. However, there is a little problem: there is not always enough real wealth (productivity) to support their spending. What to do? Well, they, through the Central Bank, expand money and credit, i.e. print money. Here comes the link: Newly created fiat money always benefits those with first access to the money such as banks and corporations, hence bankers and CEOs.

      Here’s another link: Without the public binge on housing and credit, banks will not be as profitable and they will not be paying their CEOs as much. Which is the chicken and which is the egg?

      • backwardsevolution says:

        ATP – I did not see your post until after I had posted (above) re CEO’s. Good comments. That’s exactly what happened. The bankers, with the help of the Bank of Canada who kept rates low and the changes in the downpayment and amortization rates, set up the BINGE in order to reap the bonuses.

        Again, marshmallow eaters taking their profits right off the top. The marshmallow deferrers (the savers, the prudent who didn’t get in over their heads) will end up paying.

  7. Don says:

    Of course its crazy and unfair but it is still game of numbers.

  8. backwardsevolution says:

    Mike Shedlock – “staunchly anti-union” is an understatement. He absolutely hates unions.

    I believe I was the first poster on his site that pointed out the other big unions (for which I initially got blasted, but now others see my point): the union of bankers, mortgage brokers, realtors, lawyers, doctors, builders.

    The word “union” doesn’t appear in their names; they prefer to use the word “association”: The American Medical Association (who limit the number of doctors, keeping the prices up), realtors who lobby governments, the bankers who collude and then work to have regulations repealed, etc.

    They are all unions of people who are out for their own benefit.

    Whenever Mike Shedlock speaks of unions, you can feel the hatred dripping off his words, and yet he barely (and I mean barely) goes after the FIRE industry. That’s because he is a financial advisor. Hurting the banking industry would hurt his business.

    He is a very biased, right-wing Libertarian who lacks a sense of fairness. He seldom, if ever, shows the other side of an issue.

    • ATP says:

      I don’t think it’s fair to say Mish barely goes after the FIRE industry. It is clear from his comments that he is against public bail-out of any failed business, big or small.

      Also, he is more critical of self-serving union bosses than union members. That said, I do have an issue with his privatize everything solution. I worry about corruption as an unintended consequence.

      There is a significant difference between a professional association and a union: The former cannot DICTATE their members’ action. For example, a medical association can call on its members to “go on strike”. However, it has no power to stop a doctor from treating patients. Doctors can’t stop their peers from working either. Contrast that with a unionized strike. Even if a member does not want to go on strike, the union leadership and striking members will stop him from going to work.

      As a citizen, I do feel extorted when unionized public employees go on strike. I can’t “strike” as a taxpayer, i.e. not pay my taxes in protest, without facing potentially serious consequences.

      • backwardsevolution says:

        ATP – Mish does NOT vehemently go after the shell games, the tax shelters, the fraud, the corruption in the FIRE sector. If he did, I wouldn’t be calling him unfair.

        He has tempered his attacks lately against “union clowns,” as he likes to call them, and appears now to be directly his ire towards the union management.

        He embraces globalization (blaming it on unions, although Germany seems to do fine with them) and I don’t think it would bother him one bit if every single job was sent to China. I also worry about totally privatizing everything. It would lead to just more corruption than we already have.

        Look, I agree (as I’ve never been a union member) that unions can get too strong, but a lot of their wage increases WERE based on the constant inflation we have been subjected to. I worry, though, what our world would be like if there were no unions, no one looking out for the working people. Whenever there is not a good balance, things can go down hill quickly.

        There are currently now more people than jobs and it can only get worse. I just think that instead of beating each other up, calling each other names, we ought to take a good hard look at what caused everything to go up in the first place, constant, neverending inflation, and that is caused by the central banks of the world.

      • ATP says:

        backwardsevolution,

        The problem with unions is that they have lost sympathy even from people who are, by objective standards, empathetic and reasonable. If you show these people a video clip of exploited workers toiling away in a sweat shop, I’d bet all of them would support the workers to form a union to fight for fair treatment. Ask these people if they think workers, especially public employees, in a developed country like Canada are oppressed, most would disagree. However, don’t be surprised to find these reasonable folks object to CEO mega-salaries, either. Just like common sense, the gut feeling for deciding what’s considered “reasonable” is hard to define, but it plays a major role in determining the level of public support for any group or policy.

    • Dmitri says:

      Let’s be fair here – Mish has at least a dozen of articles calling upon indictments of Wall st. cabal. His treatment of public unions is much lighter. Likewise, he makes it pretty clear that these two issues (unions and wall street corruption) are not related and both have to be solved as separate issues (which they are).

      • backwardsevolution says:

        Dmitri – I am being more than fair. His treatment of public unions is much lighter? You and I are living in two different worlds. He has nailed unions to the wall, yet he treads very lightly around the Wall Street boys. Way too lightly.

        He is calling for cities to declare bankruptcy in order to get around paying for pensions, but I have not heard of him calling for the bankers’ loot to be returned to the U.S. citizens.

        Unions and Wall Street are not related? Yes, they are. Wall Street runs the Federal Reserve. It was through their policies of maintaining constant inflation that caused the unions to ask for a raises.

        Mish likes to say that unions asked for raises and that this is the reason we had inflation. I say the unions would have been laughed out of the office if they asked for a raise when there was no inflation. Inflation was their justification for asking for a raise.

        There was inflation and THEN unions asked for raises, not the other way around. This inflation is caused by Wall Street, through their puppets at the Federal Reserve.

        I remember in the 60’s my father receiving the same amount of pay month after month, year after year – same. Things did not increase in price. There was no inflation. Was my father and other workers in asking for raises? No. Why would they be? Things didn’t go up.

        Stop the inflationary policies. It is not healthy for people to be living on treadmills.

  9. Draat says:

    When I read the comments by those on this forum that think as a taxpayer they somehow have the right to now revoke the pensions of civil servants I feel I am listening to bitter, jealous whiners. They had the same opportunity to pursue the very job that offers these benefits. More than likely they lacked the skills and either got beat out for the job or worse yet didn’t even compete. Now they are old and see someone else with something they don’t have and see that as unfair. My wife is an employee of the BC Government and her pension isn’t as good as mine and I work in the private sector. She pays for her pension monthly and indexing in the future isn’t guaranteed. It is based on the performance of the collective proceeds of those payments by all BC Gov’t. employees. My pension is a defined benefit pension with similar or better terms with a guarantee of indexing. The reason people attack the civil servants but not me isn’t because it is right – it is because they can.

    • ATP says:

      When the pension promises were made, a lot of today’s taxpayers weren’t even born! These people are not jealous, they are angry. Look at Tunis, Egypt, Libya; it’s the young who are revolting. Like it or not, there will be increasing conflict between generations.

      Here’s a quote from Stoneleigh at The Automatic Earth (http://theautomaticearth.blogspot.com/), which I find very insightful:

      “People typically believe that promises already made are sacrosanct, and that legal committments will not be broken, but we are moving into a time when rules can, and will, be changed retroactively when the money runs out. Legal niceties will have little meaning when reality dictates a new paradigm.”

      • Dmitri says:

        You’ve nailed it. We as a younger generation are simply not willing to make whole, the unrealistic promises made by politicians we’ve never voted for. To assume there is any thing else at play is simply absurd.

      • backwardsevolution says:

        ATP – yes, we’ve seen the legal shenanigans of the U.S. Treasury, Federal Reserve and the Wall Street banks: changing the accounting rules, for one, and bailing out the bankrupt banks. In fact, a day doesn’t go by where they aren’t crushing another law, regulation. The law is always crushed when you are dealing with corrupt individuals (morally corrupt), crushed in THEIR favour, but not in your’s.

        They repealed laws in the early 2000’s in order to set up their looting (Control Fraud, Bill Black calls it) whereby they create velocity by taking rates artificially down, then extract fees off everything that moves, which makes their companies look great, assuring them huge wages and bonuses. They ride this gravy train until it ends.

        That’s it, they’re done. They’ve already gotten their money (who is talking about clawing their money back?). When it falls apart, they pretend (professional bankers) that they couldn’t have seen it, didn’t know what was happening. Yeah, riiiiiight. Not one regulator stepped in to stop them? How come?

        The ratings agencies, the bankers, the mortgage brokers, the appraisers, the securitizers, the politicians – everybody knew what was going on.

        This will go down as the age of corruption.

      • backwardsevolution says:

        ATP – “It’s the young who are revolting.” That’s because they don’t have jobs. They got told to get a good education, which they did. Now they find there are no jobs. I read that 70% of Egyptian people work for the government. That’s because there are no other jobs. It’s like a form of welfare, except they go in to work every day.

        Technology greatly increased productivity. We don’t have the need for a large work force. We’re not building Pyramids by hand nowadays.

      • ATP says:

        backwardsevolution,

        You are absolutely correct about there not being enough jobs for everybody, especially the young. Now try to understand how these people, a lot of whom are educated, feel about the retired not working but getting paid and demanding to continue getting paid no matter what simply because they were promised something that these young unemployed or underemployed people never voted for and will never have a chance to enjoy. One can argue whether that’s the way they SHOULD feel, but that’s how they WILL feel.

        Not belonging to either group, I see both Wall Street and unions as problematic. Neither one has the moral high ground.

  10. backwardsevolution says:

    ATP – before there were unions, guilds, trade associations, workers were slaves to wealthy land owners. In fact, it was the Black Death that turned it around, killing off so many workers that the ones that remained were in demand and won their freedom and higher wages.

    The Industrial Revolution wasn’t that long ago, but how quickly people forget history. Who stuck up for the children who lost arms and legs in the machines (besides Dickens)?

    Why are Wall Street bankers getting away with fraud these days? Because they can. Who is going to stop them? When the balance tips too far the other way, in favour of the elites, unions will die, and then all of us lowly workers will die with them and all of the laws that protect us. It does not take much for Industrial Revolution conditions to return.

    But you’re probably right: with thousands lined up for a job, businesses will be fair, they’ll pay a decent wage. Uh-huh.

    • ATP says:

      Here’s the proper question: Why are Wall Street bankers getting away with fraud these days IN A DEMOCRACY?

      Answer: Because we, the people, INCLUDING UNIONS, all participated in the political orgy. Bankers are winning because they’re better at the game.

      To institute change, people and unions need to come clean and fight for justice as a matter of principle, instead of fighting for our own little pieces of the pie.

  11. Pingback: Revisiting predictions: Commodities still hanging tough, public sector unions under fire, European debt crisis intensifies, interest rate predictions | Financial Insights

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