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My interview Razor Sharp 18 February
Me interviewed by Sharon Firebrace on Razor Sharp on Tuesday 18 February. (0)

My interview Razor Sharp 11 February 2014
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The bosses’ wage terrorism begins

What an obscenity. The rich and powerful are telling the poorly paid that a wage increase would be bad.

Not bad for the poorly paid mind you, but bad for the rich and powerful.

Hard to imagine isn’t it – Australia’s CEOs as caring sharing types worried about job losses?

Don’t laugh. Evidently they care about jobs. Just ask Qantas, Medibank Private, BHP, Pacific Brands … The list is endless.

Our ‘Labor’ politicians are at the forefront of the attack on wages. ‘It’s jobs or wage increases’ they will lie to the Fair Pay Commission.

It is a message the Commission will accept. Its head, Ian Harper, has already said there is a link between wage increases and unemployment. 

So a meagre $21 a week extra for people on $550 a week or less will destroy the bosses’ economy. How sick is that? 

$21 by the way is what Sol Trujillo, the CEO of Telstra, makes in ten seconds. He earns in one hour what workers on the minimum wage earn in 10 weeks.

Unfortunately strong unions like the CFMEU and AMWU (or their members anyway) have accepted pay freezes to supposedly keep jobs.

All these workers are doing is lining the pockets of the bonus bilged bosses for more job cuts. 


In 1931 the capitalist class cut wages by ten percent. It worsened the Depression. Here is what Mick Armstrong says in his article Resistance in the depression years in Socialist Alternative.

 The Scullin Labor government was voted into office at the end of 1929 promising to preserve living standards. But instead, Scullin surrendered to ruling class pressure and imposed a harsh Premiers’ Plan which slashed government expenditure by 20 per cent and imposed sackings throughout the public service. Wages were cut 10 per cent by the Arbitration Court.

Unemployment went up.

Only one thing matters to the vultures  –  profit, or more precisely the rate of profit.

As the rate of profit falls (because of the very way capitalism is organised) these intellectual ‘mates of Madoff’ want us to invest in  their ponzi scheme without the extra payments.

The carrion craw of capitalism lives on our labour. To survive their crisis the bosses want to feed off the rotten carcass of the system and slaughter more and more of us for their feast.

But wait, they cry, we can fatten you up by cutting your supplies. And then we will eat you. 

This miracle is even better (and more believable) than turning water into wine.

Enough of allegorical rhetoric. The boss wants to drive your wages down, not to protect your job, but to keep his or her profits. 

But in reality they have been doing that for the last 17 years when the economy was booming. The wages share of national income is at its lowest level in over 40 years, and the profit share at its highest ever.

What Labor and their boss mates want to do is drive our share of the pie we make lower still, and increase their share.  They think wage cuts will do that. They won’t.

Profit is the essence of our society. It dominates everything.

As profits plummet, and unemployment increases, the bosses will attack our living standards to restore their profit rates.

Longer unpaid hours, wage cuts, cutting staff but keeping output targets — they’ll try anything to keep their false idol alive.

And the more workers accept their attacks, the more impoverished we become and the system ‘survives’ to begin the whole process over again, from a lower and lower base. Eventually the vampires will have no blood to feed on.

Wage cuts won’t make any difference to employment levels. It’s like imagining that a cup of water could have stopped the blazing infernos on Black Saturday in Victoria.

There is a fundamental structural problem with capitalism – the fact that as the amount of investment in capital increases at a  greater rate than in labour, and yet only labour produces their profits, the rate of profit tends to fall.

No number of stimulus packages will address that. And buying toxic banking assets just poisons us.

Attacking living standards presents one seemingly obvious way to the bosses to restore profit rates. 

Cutting wages may work in the short term, although studies from the early 80s recession show that at best wage freezes saved some jobs for only a few months.

The problem is not that wages are too high or too low. The problem is the wages system itself.

What sort of sick society says to low paid workers that to have a better future you have to have a worse present, a present that may become a lifetime? 

Capitalism now cannot offer us both wage increases and jobs. As the Great Recession worsens, it won’t even be able to offer us jobs.

Let’s get rid of this impediment to human progress.



Pingback from En Passant » Cut profits, not wages
Time July 8, 2009 at 7:40 am

[…] John predicted this outcome in March in his article The bosses’ wage terrorism begins. […]

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