11/8/07

Labor-Democrats should divorce the unions

Who wrote this? "The problem with Labor is that it's controlled, lock, stock and barrel by unions. One hundred per cent of power is in the hands of union leaders, state secretaries, and factions."

And this? "The ALP displays a startling lack of democratic process: the formal ALP-union link is characterised by the dominance of entrenched hierarchies." Joe Hockey? John Howard. No: the authors were, respectively, former NSW Minister Rodney Cavalier and ALP young gun Mark Foley (NSW Assistant General Secretary and National Executive member).

Critics have widely ridiculed Workplace Relations Minister Joe Hockey's claims that unions are both irrelevant and dangerous, saying they can't be both. They're wrong! Many unions -- broadly defined -- now do little good, but much harm. Just as workers unite to pursue their interests, so too do farmers, businesses and other groups. In the past, unions served valuable purposes. Labour unions helped workers obtain fair and safe working conditions. Farm and business unions pushed economic reforms. Outcomes in their interests were often in the public interest, too.

Unfortunately, institutions often outlive their usefulness and harm society. Farm and small business unions constantly demand special government treatment. Labour unions run scare campaigns and stymie sensible reforms (labour market flexibility, privatisation, tariff cuts) that challenge their raison d'etre or hurt their interests -- and meddle in party issues (stem cell policy, foreign affairs) that have nothing to do with their legitimate roles.

We can't blame unions for making demands. But political parties must show voters that they're genuinely committed to the public interest by eliminating arrangements that work against it. Both sides of politics have such arrangements. The Liberals' coalition with the Nationals and Labor's tolerance of union dominance of party decision-making both sacrifice public interest to narrow interests. They may rationalise such arrangements as necessities to win elections -- but that doesn't make them right.

Representative boards (AWB) don't work in the corporate world. Good boards choose directors without conflicts of interests and enforce governance policies centred on maximising shareholder value. Investors wouldn't believe a board works in all shareholders' interests if more than half of directors represent one sub-group. Yet Labor expects voters to stretch their beliefs further. Recent NSW numbers (cited by Foley) show that only 18.4 per cent of ALP members are also members of ALP-affiliated unions. Those members represent only 0.3 per cent of the voting public. Yet their unions have at least a 50 per cent say in ALP affairs!

Union/faction resistance to many party reviews have stifled change. Admirable reformers who dared advocate change were vilified and threatened. Whitlam was once almost expelled from the party. Then-leader Simon Crean led the last reform drive after Labor's disastrous 2001 election loss. Like-minded parliamentary colleagues Craig Emerson, Martin Ferguson, Joel Fitzgibbon, Kevin Rudd and Lindsay Tanner lent support. Union bosses threatened to pull their unions out of the party and threatened reformers. Transport Workers' Union NSW head Tony Sheldon ranted: "Simon Crean, if you don't tell them to shut up ... your days are numbered." Crean's weak electoral appeal meant his days were numbered anyway, but self-serving unions supported Beazley's challenge (knowing he wouldn't reform anything). When unions engineered payback -- a pre-selection fight for Crean last year -- Electrical Trades Union secretary Dean Mighell gloated: "Anybody who has worked actively to reduce union influence in the ALP we're no fan of."

Neither then-leader Beazley nor leadership-aspirant Rudd supported Crean -- each needed union favour to retain/win leadership. Fitzgibbon dubbed Crean's against-the-odds pre-selection win "a victory for those who want to empower people over those who simply seek power". Crean suffered greatly for little gain. The union vote at National Conference (the party's supreme policy-making forum) was cut from 60 to 50 per cent. But Cavalier called that "meaningless: whether it's 60 per cent or 30 per cent, it still leaves them with 100 per cent control".

Since becoming leader, Rudd has driven policy, not party reform. Yet he'd argued in 2001-02 that "Labor needs fundamental, not incremental, change across policy, organisational structure and culture" and advocated abolishing the "socialist objective" as an "important part of the modernisation process". It remains the very first objective in Labor's Constitution.

Rudd is smart: a union bun-fight is electoral suicide. Previous drives failed because leaders in opposition were too vulnerable to union pressure. The few election-winning leaders simply used their new-found power to override unions. This was less risky than permanent reform, but it did successors no favours. We can only hope Rudd leverages the power earned through electoral victory to drive reform. Tony Blair stared down union trogdolytes like Tony Benn to institute substantial (though still insufficient) reforms -- abolishing its socialist objective, cutting the union vote at National Conference and giving union bosses no say in pre-selections.

Rudd's smoke signals show promise. Statements such as "I respect the role of unions, but we will make the call always in the national interest" sound good, but any leader would say that. But, tellingly, he's stacked his front-bench with reformers: Crean, Emerson, Ferguson, Fitzgibbon and Tanner.

Union bosses' rationalisations of their privileged positions are inane. Emotive references to unions' fights over asbestos compensation may suggest they have some relevance to their members -- but not that union bosses should rule the ALP. Bill Shorten's response to Hockey's taunts was: "Two million people go to work every day and belong to unions. This doesn't make them second-class citizens." True -- if they're party members, they should have exactly the same say as any member -- but their bosses shouldn't have more. Julia Gillard claims that union involvement in the ALP didn't stop key Hawke/Keating reforms. But, as former Hawke Minister John Button says, "the government that reformed and deregulated the economy wasn't made up of political mandarins" -- union officials accounted for only 15-20 per cent of Hawke's first Ministry. While Hockey's claim that's it's now 70 per cent is debatable, it's at least tripled since Hawke. And massive union amalgamations mean few union bosses control union votes, easing their ability to fix deals.

A 1979 review noted that only four other genuine Labor parties existed on earth. Subsequently, two (Norway, Sweden) switched to social democracies while Blair cut union influence in British Labor. Australia and NZ remain laggards. Button recommended that Labor instigate a "friendly divorce" from unions in 2002.

Rudd should turn Labor into a social democracy. Individual union members would be welcome as party members. The pigs' proclamation in George Orwell's Animal Farm that "all are equal, but some are more equal than others" warned of hypocritical institutions that preach equality but practice privilege. Labor should stop treating rank-and-file members like second-class citizens.

(theaustralian.news.com.au)

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