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Issue #1679      April 1, 2015


Dissent among the “free-marketeers”

A generation has grown up absorbing the “free” market mantra about unfettered competition delivering the best outcomes for society. Tales of how the “invisible hand of the market” ensures the availability of the best goods at the best price are repeated regularly in Australian high schools, universities, TAFE and other centres for vocational training – and not just in their economics courses. The media is dripping in the same “consensus” declared from on high.

The political line is held with great consistency by spokespersons representing capitalist interests. It is rare, and thus very interesting and revealing, when dissent appears in the class enemy’s ranks in public. Comments by Fortescue Metal Group’s Andrew “Twiggy” Forrest at a business function in Shanghai caught some off guard before discipline was reasserted. Forrest floated the idea that the big four iron ore producers operating in Australia could put a cap on production, thus limiting supply, to cause a rise in the price per tonne. If Rio Tinto, BHP Billiton and Vale put their heads together and limited production to 180 million tonnes a year, prices could back around the $90 a tonne mark rather than the current $50.

Foreign minister Julie Bishop initially thought it “worth considering”. Her government is missing the tax revenues available at the height of the mining boom. Treasurer Joe Hockey, however, gave the official thumbs down to the idea, saying that it smacks of cartel behaviour. The rebukes of Forrest got sharper and sharper as the days went by. Rio Tinto boss Sam Walsh called the plan “absolute nonsense” and a “harebrained scheme”. Eventually, Chairman Rod Sims said the Australian Competition and Consumer Commission was investigating whether Forrest was guilty of advocating a cartel – presumably a very serious offence but for which nobody in Australia is expected to do jail time. Ample evidence regarding petrol and food pricing has never quite fixed the issue in those retail industries.

“Twiggy” Forrest is hoping the exemption regarding exporters acting in the national interest will protect him on this occasion. Some smaller iron ore producers found all the free-market “purity” too much to bear. Tony Sage of Cape Lambert Resources pointed out that the big boys have cooperated happily in the past. “All of them have spent, combined, tens of billions of dollars getting their expansions to where they are today and if they did not see the consequences of that, they are not as smart as they think they are.”

While big and medium-sized capitalists might fall out from time-to-time over the concentration of market share and predatory pricing, they are united on the core issues of the class struggle. All of them have contributed to the current campaign to portray trade unions, not as workers uniting to protect their interests from the predations of employers, but as something sinister. This line of attack is as old as the trade union movement itself. The Tolpuddle Martyrs were transported to Australia for “combining” and swearing oaths to support their fellow workers against the lowering of wages in England in the early 19th Century.

Since those times, Australian unions have been accused of being “red” conspiracies to bring down capitalism and illegitimate “rent takers”. Lately, suffering under a barrage of workplace relations “reform”, they are being legally defined as “third parties” that could be replaced by other, non-union representatives in bargaining or preferably, from the employers’ point of view, no representative at all. The most recent and perhaps the most curious smear is that trade unions are “cartels” in the labour market, which should be as “free” (i.e. monopoly dominated) as every other market. Sanctimony about cartels is where we came in.

Workers have no defence of their living standards under capitalism without forming themselves into trade unions ready, willing and able to act in their interests. A lot of damage has been done to the image of unions in workers’ eyes in recent times by the bosses, their media and some right opportunist leaderships in the trade union movement itself. That damage has to be repaired and the hypocrisy of the employers about “cartels”, and so on, soundly rejected.

Next article – NSW Elections – Two-party system takes a hit

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