You might expect me to write about the RC into banking today.
No and this is because Ross Gittins has hit the nail on the head. Wages aint going to increase much in the foreseeable future without some legislative help.
This leads one to cogitate on what sort of legislative help will actually help?
Just before we go there this is the second episode as far as I can see where policy makers did not think through what their change in policy would do.
The first of course was in electricity. Privatising that market had no basis in theory ( it was an essential market) and nor in practice as the markets were not competitive before because the assets were owned by State governments and would not be in future since the industry consisted of oligopolies.
It was Paul Keating who first deregulated the labour market. This was sensible as at that time it was highly regulated. John Howard re-regulated the labour market in favour of employers. work choices was very 1984ish in its name and most people reccognised this.
Julia Gillard then further de-regulated the labour market.Ever since then many uneducated commentators ( see Catallaxy and particularly Judith Sloan) ( and conservative politicians) have seen umpteen wage explosions coming. They have never . Indeed Union membership has continued to decline.
What this means is that even if you grant greater powers to unions little improvement can be expected.
What we have seen thus far is almost all the improvements in productivity go to employers . Employees has seen little gain here.
So essentially I have to admit i am stumped at what the ALP could do top improve wages when they gain Government. I say the ALP because the Present government has said they will do nothing.
The only positive is employment growth is higher than it would naturally be. As a corollary unemployment is lower.
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