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Issue #1474      29 September 2010

Roll back the corporate agenda

The ruling class “solution” to the economic crisis is more tax breaks for the rich and the corporations, wage cuts and public sector sackings, privatisation and less government spending. These are the very neo-liberal policies that helped deepen the economic crisis which broke out in 2008, and which continues across Europe and north America. The following commentary by the Ontario Committee, Communist Party of Canada published in People’s Voice (September 13-20, 2010) is a timely warning of what the ruling class has in stall for Australian workers and trade unions.

The Ontario government, in collusion with private sector employers, is about to download the cost of the economic crisis onto the backs of public sector workers with “consultations” aimed to corral unions into framework agreements that will result in a six percent wage cut over two years. The cuts will take place during the next five years, whenever collective agreements come up for renegotiation.

The so-called “wage freeze” is actually a wage cut when the annual inflation rate of almost three percent is included. This is a wage cut that workers will never get back. Furthermore, the money “saved” in unpaid wages has already been spent: on a C$4.5 billion corporate tax cut. This is on top of a permanent reduction in the corporate tax rate (down to 10%) and on top of the C$4.5 billion gift to Business given via the HST(Harmonised Sales Tax). There is no “saved” money going to improve public services.

In fact, public services, unionised jobs, and free collective bargaining in Ontario are all in danger from a real reduction in health care spending. Wage cuts, contracting out, privatisation, and deregulation are all parts of the Liberals’ spring budget, appropriately named “Open for Business”. This is a Big Business agenda – aimed to increase profits by selling off public assets, reducing and privatising public services, and permanently reducing public sector wages by six percent. Because of Balanced Budget legislation, it will also mean layoffs.

The provincial government’s strategy in this summer’s “consultations” with labour is to scare unions into voluntarily accepting the six percent wage cuts. But the government is also threatening to introduce wage control legislation, using the “consultations” as justification in any future court challenge by labour.

The government’s agenda is all about driving down wages, undermining free collective bargaining, and privatising Ontario’s public services and assets.

Working class under attack

This attack on public sector wages and free collective bargaining follows on the heels of the attack on autoworkers 18 months ago, when Canadian Auto Workers (CAW) members saw their collective agreements ripped open and plundered three times in six months. Facing not only the employers but the Canadian, US, and Ontario governments and a vicious national media, the CAW was forced to negotiate wage cuts and concessions “with a gun to the head”.

In Sudbury and Port Colborne, 3,300 United Steel Workers miners struck for 360 days against Vale Inco, the second largest mining company in the world, before being forced back with two-tier pensions and cuts to take-home pay. Once again, the Liberal government sided with the employers, steadfastly refusing to pass the anti-scab legislation that could have forced the employer to the table to negotiate a settlement.

Now, Premier McGuinty justifies the attack on the public sector by claiming “fairness”: public sector workers must take the same beating as private sector workers with lower wages, poorer pensions, and weaker unions. Furthermore, if public sector workers don’t take the cuts, public services will suffer.

With these arguments, McGuinty and the employers behind him, hope to split the working class and turn the public against public sector workers and their unions. It’s a vicious, ugly and dangerous strategy with all workers in the bulls-eye.

Across the province – and around the world – workers are losing ground to corporations and right-wing governments that are driving down wages, stripping pensions and benefits, using scabs, police and courts to attack unions and threaten free collective bargaining.

McGuinty and the employers behind him, hope to split the working class and turn the public against public sector workers and their unions.

Bad economics

But workers didn’t cause the crisis, and they should refuse to pay for it. In fact, reducing wages will deepen the crisis by reducing purchasing power and increasing indebtedness. The results will be inflation, more layoffs, higher unemployment, reduced tax revenues to government coffers and increased Employment Insurance and welfare payouts from government coffers. Privatising public assets and services will cut wages even further, and cost the public more in higher user fees and lost public resources and property.

The crisis in public services isn’t caused by public sector wages or expenditures. In fact, expanding public services and improving them would help the economy and serve the public interest very well.

This is a revenue crisis, caused by right-wing governments determined to reduce corporate taxes at any cost. That’s why Ontario and Canada now have the lowest corporate income taxes of any industrialised country, and why corporate taxes here are 15 points lower than the US Great Lake states – our biggest trading partner.

A People’s Recovery

Raising corporate taxes, expanding services, creating jobs, raising wages, and expanding purchasing power – this is an economic policy that would lead to a People’s Recovery in Ontario.

We should build affordable social housing, introduce a provincial system of universal, quality public childcare, expand Medicare to include denticare, pharmacare, and long term care, and build a publicly owned transportation system to build public transit, interurban light rail systems, and a Canadian car.

We should develop the north, in consultation with the Aboriginal and northern peoples, to develop secondary industry and manufacturing and turn one-industry towns into diversified, stable economies. We should put Ontario back to work, in well-paid, permanent, unionised jobs.

United and fighting labour movement

The message is clear: labour must unite to defeat the attack on workers’ wages – public and private sector. There must be a coordinated and united response, led by the Ontario Federation of Labour (OFL) and Canadian Labour Congress (CLC) to defend and improve all wages and working conditions, and fight to expand the public services, manufacturing jobs, and labour rights that are all under ferocious attack in Ontario today.

The OFL convention decisions are the basis for mobilising labour and its allies, including youth and students, women, seniors, Aboriginal Peoples, People of Colour, the environmental, peace and social justice movements, farmers and cultural workers, and all those concerned with defending our rights and standards.

What’s needed is a united leadership with the will to mobilise the labour movement and its allies in a province-wide struggle to defend workers’ jobs, wages, pensions and living standards, and to curb corporate power and defeat right wing governments at every level. This is the key issue today.

A mass struggle led by the OFL, that puts masses of people into the streets in independent labour political action, is both possible and urgent to defeat wage restraints and mount an effective counteroffensive against the right-wing, corporate assault.

The Communist Party stands 100 percent with public sector workers and their unions fighting to defend public services and free collective bargaining. We are committed to help build a movement that can roll back the corporate agenda, and roll out a People’s Recovery in Ontario. 

Next article – Review – Crude: Documenting the real price of crude

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