McGowan: Harper's gift on Labour Day - wage suppression

This Labour Day, working Albertans have a lot to be thankful for.

We have the highest wages, the best job prospects and the highest standard of living in Canada.

So, it's entirely appropriate for Albertans to be smiling as they fire up their barbecues for the last long weekend of the summer: life here in the land of oil is pretty good.

But before we get too comfortable, it's important to recognize that not everyone is pleased with how well ordinary working people are doing.

In fact, recently disclosed documents show that some of our country's most influential CEOs and business lobbyists are asking the federal Conservative government to help them suppress wages.

This revelation comes from a Department of Finance briefing note that summarizes the proceedings of an economic policy retreat organized by federal Finance Minister Jim Flaherty.

The retreat was held last summer and attended by a long list of business leaders and representatives from right-wing think-tanks - all eager to advise members of the Harper government on how they should take advantage of their long-sought-after majority.

The assembled business audience told the finance minister that Canadian workers are overpriced and that Canada could only become truly competitive if governments and businesses addressed the "wage differential in labour markets between countries."

In order to drive down wages, participants advocated the introduction of American-style anti-union labour laws.

For good measure, they also called for deep cuts to public services and the introduction of two-tier health care - while at the same time asking for more corporate tax cuts.

There are at least three reasons why working Canadians should be concerned about this meeting.

First, there is no evidence that the federal government challenged the notion that Canadians are overpaid.

This is troubling because, after adjusting for inflation, wages for average Canadian workers have stagnated over the past 30 years. In fact, the share of national economy going to wages for Canada's middle class has been dropping, while the share being gobbled up by corporate profits and incomes for the wealthy has been increasing.

Even here in prosperous Alberta, nearly a quarter of all working people earn $15 per hour or less. And the average hourly wage earned by permanent, full-time workers is $27. That's the best in the country, but barely enough to afford a decent home in either Calgary or Edmonton.

If there is a problem with wages, it's not that Canadians are overpaid - it's that a growing number are not paid enough to maintain to a secure, middle-class lifestyle.

Second, working Canadians should be concerned, because the wage-suppression wish list outlined by business leaders last summer has quietly, but clearly, become a central part the federal government's agenda.

How else can we interpret the Harper government's decision to allow employers to use more temporary foreign workers and to pay them as much as 15 per cent less than Canadians?

Or rule changes that force many unemployed Canadians to take any available work after six weeks on EI, even if it pays up to 30 per cent less than their previous job?

There's also the Harper government's decision to raise the retirement age to 67 (which is obviously designed to force older workers of modest means to keep toiling away in lower-wage jobs) and their ongoing attacks on unions and collective bargaining (which are designed to undermine the ability of workers to have a say in their own wages and conditions of work).

Taken together, these policy initiatives amount to what is essentially a low wage strategy.

The third reason why working people should be concerned about Flaherty's previously secret meeting with business leaders is that it is not an isolated case.

The truth is that representatives from groups like the Fraser Institute, the Canadian Federation of Independent Business and the Merit Contractor's Association (representing non-union construction companies) have dramatically ramped up their lobbying efforts in Ottawa and provincial capitals over the past year.

With the most ideologically conservative prime minister in Canadian history holding the reins of a majority government, they see this as their political moment.

Unfortunately for working Canadians, these lobbyists have been disturbingly effective. In addition to influencing the federal government, they've won allies at the provincial level.

For example, Saskatchewan Premier Brad Wall and Tom Hudak, leader of Ontario's official Opposition, have both been advocating U.S.-style union-busting laws.

Some people may shrug and say "who needs unions anyway?"

But as Nobel-prize-winning economist Paul Krugman has said, unions - as imperfect as they may be - are the only counterbalance we have to unbridled corporate power. They also provide one of the only mechanisms we have for ensuring the more equitable distribution of income necessary for the creation of a vibrant middle class.

So as working Albertans enjoy the Labour Day long weekend, it's important for them to understand that a battle of world views is raging around them.

Will the low-wage advocates who attended Finance Minister Flaherty's private policy summit win the day? Or will Canadians reassert their traditional preference for a more progressive approach - characterized by fair taxation, investment in quality education and infra-structure, and policies that see unions as vital partners in the economy?

For the sake of Canada's middle class, let's hope that the high-road vision prevails. Because if it doesn't, more of us may end up flip-ping burgers at McDonald's on Labour Day instead of flipping burgers at the lake.

Gil McGowan is president of the Alberta Federation of Labour.

The Calgary Herald, Monday September 3 2012

Op-Ed, Gil McGowan


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