Industrial Relations -- Which Way to Justice?

Ron Johnson

[A speech delivered at the National Press Club, Canberra, Australia; 15 September, 2006. Ron Johnson is Secretary, The Association for Good Government, ACT Branch]

Speech delivered at the National Press Club, Canberra- 15 September 2006. Thank you Mr Chairman, Ladies and Gentlemen. Thank you for your attendance. Welcome to the Public Launch of the Association for Good Government ACT Branch. We now have Georgist organisations in every State and Territory in Australia (except the Northern Territory). These organisations are devoted to educating the public in the ideas and principles enunciated by Henry George. His most famous book published in 1879, Progress and Poverty, was dedicated:

"To those who, seeing the vice and misery that spring from the unequal distribution of wealth and privilege, feel the possibility of a higher social state and would strive for its attainment."

Now, over a century later, our new Association has been formed thanks to the continuing work and dedication of people such as those to whom George dedicated his book. People like William Pitt, now deceased of Melbourne, Richard and Faye Giles of the NSW Association and former Whitlam Labor Government Minister, the Honourable Clyde Cameron.

There are of course many others who also have nurtured and kept our movement alive. The new ACT Branch is formed in the hope that we can attract and educate new devotees also prepared to strive for the elimination of poverty and the attainment of social justice and prosperity. Like it's sister organisations, the new branch aims to make the study of social justice, political economy and topics like industrial relations easily accessible to the general public.

Our first ACT course on Industrial Relations and Social Justice will be run over four Saturdays in November this year.

In his book Social Problems written in 1883, Henry George wrote,

"Social reform is not to be secured by noise and shouting; by complaints and denunciation; by the formation of parties, or the making of revolutions; but by the awakening of thought and the progress of ideas. Until there be correct thought, there cannot be right action; and when there is correct thought, right action will follow."

It is in that spirit of peace and education that I hope social justice and particularly the elimination of poverty can be achieved in the 21st Century. The philosophy of Henry George is a radical philosophy of enduring relevance in the realms of ethics, politics and the 'bread and butter' economics of everyday life. It is a philosophy that promotes equality of opportunity and individual freedom. It challenges monopoly, unfair privileges and unwarranted restrictions on human economic and social activity.

Henry George re-discovered and clearly enunciated the natural laws of political economy and also our fundamental natural human rights. These natural laws and natural rights pre-date government and are perhaps as old as human life on Earth.

We have on stage a fine specimen of Wollemia nobilis, commonly known as the Wollemi Pine. This tree is a gift from my wife to the Association for Good Government ACT Branch to commemorate our launch. As many of you probably know, in 1994 a small cluster of Wollemi pine's were discovered in Wollemi National Park near Sydney. These plants were the only known survivors of a plant genus that predates the Jurassic period and has survived for at least 200 million years. The botanical information that comes with the plant states:

"Although the Wollemi Pine is one of the most threatened plants on Earth, it is highly versatile and easy to grow. It tolerates heat, cold, full sun and shade, as well as different types of soils. It is the ultimate survivor, having outlived both the dinosaurs and many of its contemporaries in the plant kingdom."

The philosophy of Henry George is the "Wollemi pine" of politico-economic thought. The Georgist movement has been close to extinction, yet it has survived and hopefully will once again find mass support in the 21st Century.

This tree will eventually be planted in the grounds of our yet to be purchased Canberra Headquarters. It will grow as a symbol of the resilience and regenerative power of our great movement for social justice. It will be known as the "Tree of Social Justice".

Industrial relations consist of much more than industrial law. Industrial relations can be defined as - all human interactions and exchanges relating to labour and wage determination. As such, industrial relations is a very broad topic and comprises a very large part of all human social interactions. Ethics, political economy and spirituality are all vitally relevant to industrial relations. Industrial relations only arise as people associate together and apply their labour to land. The natural right to land lies at the heart of labour freedom and also at the heart of fair industrial relations.

In terms of industrial relations, social justice is a state of affairs where people are free to develop their capacities through work of their own choosing and to receive the full and proper reward for the work that they do. The philosophy of Henry George provides a clear pathway to social justice and beyond. George saw justice as only the beginning or necessary foundation of a good society. George recognised that for humanity to truly progress, justice must be overlaid with compassion and love. This is best illustrated in his numerous references to the teachings of Jesus Christ and in particular to the Golden Rule, that we must do unto others as we would have them do unto us. George recognised the necessity of conforming human law with the natural law.

Henry George emphasised the importance of all people studying and thinking about how we can improve social conditions. He recognised the great power that can come when people are galvanised by a sense of spiritual duty to their fellows. In 1883, he wrote:

"I believe that the idea of duty is more important for social improvement than the idea of interest; that in sympathy is a stronger social force than in selfishness. I believe that any great social improvement must spring from, and be animated by, that spirit which seeks to make life better, nobler, happier for others, rather than by that spirit which seeks only more enjoyment for itself. For the Mammon of Injustice can always buy the selfish whenever it may think it worthwhile to pay enough; but unselfishness it cannot buy."

This idea is borne out by the great effectiveness of the campaign that has been run by the Australian Council of Trade Unions and others against the new so called "WorkChoices" legislation. As part of that campaign, there have been quite a few examples of workers coming forward and saying that because of their relatively good labour market position, they are not so worried about the impact of the laws on themselves. They quickly add that they are concerned about the effects of the laws upon their children as they enter the workforce or for other workers in a more vulnerable position.

I agree with the ACTU that the union movement is winning the public debate about the unfairness of the new industrial relations laws. They are winning to the extent that they have been far more effective in inspiring support from people who are motivated by a concern for their brothers and their sisters in the workplace and in the community, not just a concern for their own circumstances. However, the Government has garnered considerable support for their case that we need their industrial relations changes in part because of our duty to create new opportunities for people who are involuntarily unemployed. This accompanies their controversial idea that increased labour flexibility, including downward flexibility, leads to increased business profitability that after some trickling down of wealth, ultimately benefits and serves the whole society. I think that this view sadly misses the point that work is not an end in itself. It is also based on an unrealistic view of the supposed freedom and fairness of our labour market.

The truth as I see it is that justice and freedom are inseparable. A truly free labour market would deliver social justice. Yet nowhere in the world today, including in Australia, do we find a truly free labour market or a truly free economy. Indeed, we are a long way from freedom. The labour market is rigged, distorted and corrupted and hence it becomes a "bad master" in terms of our industrial relations. Hence, the desperate struggle by workers to form themselves into unions and to seek legal rights as protection against the rigged market.

The legal industrial relations protections for Australian workers that have come through painstaking struggle over the past Century have been seriously eroded with the introduction of the new federal industrial relations laws this year. These legal rights include, but are not limited to: the right to protection against unfair dismissal; the right to a 'decent living' minimum wage; the right to a safety net of award conditions, the right to organise and bargain collectively; the right to independent conciliation and arbitration; the right to union representation; and the right to strike.

To a large extent it is a restoration and re-strengthening of these rights that is now being sought by the ACTU. In an excellent speech at the National Press Club this week, ACTU Secretary Mr Greg Combet outlined a new vision for Workplaces that centres crucially on legally supporting and promoting good faith collective bargaining. The ACTU proposal also supports the abolition of individual contracts known as Australian Workplace Agreements that undermine collective agreements.

I agree with the case put by the ACTU, and backed up by a considerable weight of research, that collective bargaining delivers better outcomes for workers. I agree also that collective bargaining is a superior proposition in terms of the prosperity of business, the economy and society generally. I think also that former Prime Minister Mr Bob Hawke is correct in his warning that the new industrial relations laws, if not repealed, will lead to:

"a change in attitude in the workplace environment- there won't be the degree of positive co-operation that there's been in the past."

After all co-operative industrial relations are vital to our survival. As Henry George discerned,

"Civilisation is co-operation. Union and liberty are its factors."

The type of co-operation engendered by an approach that says sign here- or no job, is co-operation by direction. We need a truly free industrial relations system that promotes spontaneous co-operation whereby the enormous untapped potential of human labour and mental power can be unshackled.

Contrary to the Marxist perspective on industrial relations, Henry George maintained that there is no inherent conflict between capital and labour. He saw labour and capital as natural allies and wrote that the true conflict is between labour and monopoly. He stated:

"Give labour land; let it get it on equal terms; secure to the labourer the reward of his exertions, and the distinction between the labourer and the capitalist will pass away."

The debate about the new Industrial Relations laws known as WorkChoices is an important debate for the Australian community. Whether we have an industrial relations system with a primary emphasis on individual contracts or on collective bargaining will make a real difference in many people's lives. This is a debate that can be traced right back to the genesis of the organised labour movement in Australia in the latter part of the nineteenth century. Yet, it is crucial to understand that workers are locked into a struggle for their legal rights at work only because historically they have had their natural rights denied, stolen and obfuscated. It is this denial of natural rights that rigs the labour market against workers in favour of those who gain from speculation and rent collection.

Important as it is to have good industrial relations laws, they are not the prime movers in determining the type of labour market that we have. Our industrial relations are far more heavily influenced by the fundamental arrangements governing the interrelationship of land, labour and capital in our economy. The key driver of our industrial relations is in fact, the conditions under which producers (of all kinds) get access to land. Land includes all natural resources. All wealth production and all service provision arise from the application of labour or labour and capital to or upon land. Capital is that part of wealth set aside to aid in further production or service provision. Land is not the produce of human labour and therefore land is not capital. Land is provided by God and is the property of God. This is the crux of the political economy taught by Henry George and the point wherein he may be distinguished from most other economists. He believed that the right of ownership should properly only attach to those things produced by labour. He believed that people could legitimately hold secure tenure over land, but not ownership.

This brings us back to our natural rights and the natural law of the Golden Rule. The use and enjoyment of land is indisputably necessary to human life. By virtue of our existence, we have a right to live and therefore a natural and inalienable right to use land. It is self-evident that, this right to live and use land is limited only by the equal right of all other people to the same. Once people assert rights to land that transgress the equal and inalienable rights of other people, the Golden Rule has been broken.

Under our current system of the private ownership of land, there are many unfair and unnecessary costs and restrictions in the way of a worker or entrepreneur wanting to produce some type of wealth or provide a service. These include:

• The great cost of buying or leasing a site;
• the great burden of taxation;
• the great cost of interest charges; and,
• the effects of any other trade restrictions.

These costs and restrictions create and underpin the conflict and tensions that exist in our industrial relations. These costs and restrictions create unemployment, by shutting labour out from land when there is an abundance of work to be done and they drive wages down below a fair level. These costs and restrictions are the manifestation of a poison curse that enters our social and industrial relations when the natural, equal and inalienable right of all people to use and enjoy the Earth is denied. To find justice, to ensure that workers get the full and proper reward for their labour, we must first observe the Golden Rule of equal rights to the Earth.

I acknowledge that what I am speaking about today may be for some members of the audience a big step to take in terms of the mainstream conception of the debate about industrial relations. Natural law and natural rights may seem divorced from the practicality of day-to-day relations with your employer. Yet, if we are to achieve social justice, we cannot simply prune back the branches of injustice. We must get to the root cause of the problem, and we must have a practical remedy around which people can galvanise.

Henry George's remedy was to educate people about the need to restore their equal rights to land. The practical application of this remedy that he proposed and that is entirely suited to today's modern industrial and technological economy, requires the government to abolish all taxation save that on land values. As Richard Giles has said, Henry George's 'single tax' should not be viewed as a mere fiscal measure:--

"It is part of the natural order. It is a way to exercise our right to use the earth when we want exclusive use of it. George offers us a way to do this while respecting the rights of others."

The single tax can be more properly described as the public appropriation of the value of communal labour co-operation by way of an annual site rental charge. This is the natural way to fund government expenditure.

Site rental value is created not by individual effort, but by the community as a whole. Taxation shackles and robs labour, stifles enterprise, impedes production and restricts free trade. When we consider industrial relations, an idea that has resonance with many Australians is the idea of a "fair days pay for a fair days work." For well in excess of one hundred years, good people of the Australian labour movement have devoted their lives to the struggle for reasonable working hours and conditions, wages that allow families to live in frugal comfort and equal pay for indigenous Australians and women. Yet throughout the twentieth century and now into this century, many of the gains made through industrial relations laws seemed to almost evaporate under the influence of the market or the effects of taxation laws or other government regulation or deregulation. Through their unions, workers made some significant gains in the early 1970's for example -- only to see much of this lost through the effects of inflation and subsequent wage freezes and limitations of the Fraser and Hawke years.

The Keating-Howard era has been characterised by productivity based pay bargaining that has seen many conditions traded-off in exchange for fairly modest pay increases. Penalty rates, annual leave loading, overtime pay and allowances are now things of the past for many workers. National Wage Case Safety Net Increases and enterprise bargaining gains are continually eroded by measures such as the Goods and Services Tax, which has raised most prices by ten per cent. Workers can fight a tremendous campaign for an enterprise bargaining pay increase only to be slugged with an interest rate increase, a rent rise, a petrol price rise, a childcare fees increase or a rise on health costs or insurance premiums.

Out on the street there are speed cameras, parking fees, parking fines and road tolls. The banks have their own special "battlers" charges for late fees on credit card bills or having insufficient account funds for a direct debit payment. For many workers, a visit to the dentist or specialist, a car smash, or the purchase of a pair of shoes can throw the fortnightly budget into the red.

Since 1996, commercial, industrial and residential land prices in Australia have more than doubled and in some areas nearly trebled. Much of this inflation in land price is attributable to non-productive speculation, particularly by overseas interests. Australian families are now under massive strain. Children are seeing less and less of their parents, as Mum and Dad generally now both need to work to pay off the mortgage repayments to cover the spiralling cost of land. Our land is ranked as among the least affordable in the developed world. We know that labour productivity is up and that people are working excessively long hours and massive amounts of unpaid overtime.

I suspect also that the true rates of unemployment, underemployment and inflation are much higher than official figures suggest. The Government likes to cite figures showing modest real wage growth since 1996, yet the debt of the household sector is at an all time high. Mortgage, personal loan and credit card debt are strangling the prosperity that Australian families should be enjoying. Economic growth has been fuelled by and become reliant upon an unsustainable level of borrowing. Likewise, the fire-sale of publicly owned assets like Telstra that is underway is not a sustainable way to balance the books and is serving to further compound the cost of living and the decline of services like public telephones.

Serious questions need to be asked about how much of the benefits of the current minerals boom are simply going straight overseas. Serious questions need to be asked about the ongoing degradation of the environment in this country. Is the government propping up unclean industries at the expense of more environmentally viable solutions?

More than two million Australians are currently experiencing poverty and severe hardship. Compared to other developed countries, Australia currently has the second highest percentage of people living below the income poverty line. A recent report suggests that almost fifteen per cent of Australian children- 743,000 are living in poverty. The number of children living in poverty has been increasing since the mid-1990's. Australian Indigenous children suffer health problems on par with or worse than the populations of many developing countries. In the midst of this comes the cry from the current Prime Minister that we are living in prosperous times and that we have "a workers market". The truth is that, except for those with very scarce skills, we do not have a "workers market" in Australia today we have a rent collectors market. We have a market that enables "rent collectors", granted unjust privileges by the State, to acquire without labour, the property rightly belonging to persons who have expended their labour.

If we are ever to truly satisfy the Australian people's long yearning for a fair days pay for a fair days work and a fair go for unemployed workers and community as a whole, we need much more than a fair system of industrial relations laws, we need a free and fair labour market and a free and fair economy operating beneath those laws.

Put simply, I am saying that people need by peaceful means to claim their land rights and thereby secure the proper wage that they have worked for. I am saying that government policies in relation to land accessibility and taxation are in fact the key drivers of our industrial relations and our economy. In comparison to land policies and tax policies, the new so-called WorkChoices legislation, whilst important, is of much less significance to Australian Industrial Relations.

The principles that I have talked about today have a greater part to play in Australian history than what many people may realise. Supporters of the philosophy of Henry George once held dominance within the union movement, the Labour Electoral Leagues and the early Labor Party. The Thirteenth Plank of The First Labor Party Platform of 1891 sought --

"the recognition in our legislative enactments of the natural and inalienable rights of the whole community to the land- upon which all must live, and from which by labour all wealth is produced- by the taxation of value which accrues to land by the presence and needs of the community, irrespective of improvements effected by human exertion; and the absolute and indefeasible right of property on the part of all Crown tenants in improvements effected on their holdings."

When people normally think about land rights, they think about the very important and more obvious area of indigenous land rights. Yet the philosophy of Henry George reminds us that all human beings have land rights and that we all need the right to use and enjoy land if we are to live freely. The national debate and divide focused around the WorkChoices legislation has brought into sharp focus important questions that will not easily be dispelled. Regardless of the outcome, these questions will not be dispelled by the 2007 Federal Election.

There is an imperative for the Australian people to think deeply about the underlying forces in our economy that drive the industrial relations arrangements that we see on the surface. I believe that if people continue to think- instead of letting others think for them, they will realise the same thing that a very wise man by the name of Vincent Lingiari and his Gurindji people realised forty years ago. In 1966, Vincent Lingiari and his Indigenous pastoral worker colleagues went on strike from their slave-like employment at Wave Hill Cattle Station owned by Lord Vestey. Their strike began with a quest for equal pay and decent conditions, yet it soon developed into a long struggle on the more fundamental issue of their claim to their traditional land rights. This struggle was of course famously partially rewarded in the 1975 land return by the Whitlam Government.

I am not suggesting that Australian workers commence a national strike or any type of boycott. I am suggesting that people realise and study the importance of the land question in the context of industrial relations and social justice and give serious thought to how the philosophy of Henry George might benefit our country today. Just like the bushwalker who discovered the Wollemi Pine, David Noble, you too might discover a hidden treasure and find some new hope for humanity.