Are high wages ok in a globalized world ?
Frank Pio Russo - April 23, 2016.
Here in Australia the unions are always pushing for higher and higher wages. They only represent about 20% of workers, but by controlling the Labor Party - which represents about half of the population - they end up controlling the whole country when the latter are in power.
However, one must be conscious of the fact that the technology gap between us and the 3rd world no longer exists. Throughout the decades, the advanced countries' companies have kept shifting their production to the 3rd world, so as to take advantage of the latter's low wages. Well by allowing this to happen, the 3rd world has industrialized and caught up in technology - all at the 'stupid' West's expense!
So it's now a bit hollow and pointless to tell our country to focus on technology and innovation, whilst we still push for higher wages! We've got to accept that such services have been greatly depreciated in financial value... we cannot pay ourselves an astronomical amount in contrast to what Indian engineers would instead accept for their services. Remember India has most of the engineers of the world and they'll certainly accept much, much lower wages than people do here in Australia!
What realistic and pragmatic unionists and others should realize, is that from now on there's going to be a constant equilibration of wages across the world. In a globalized world this is essential for things to function well... i.e. a sort of 'universal wage' for everybody. I mean it's understandable to try and at least preserve the current 'status quo' despite it being now virtually impossible, but the ridiculous thing is that often many unionists are very greedy and want to go far beyond the CPI increments. This should be acknowledged as unacceptable: if anything, the West should be prepared to accept a gradual fall in living standards!
Further evidence for the foregoing is the new reality of low interest rates on any money invested. Namely: if the investors are making a great deal less, why could anybody expect the workers to still be making more and more?
In conclusion it appears that many Australian and other 1st world workers, are facing or will face the question: do we want to continue pushing for higher wages and risk losing our industries... or should we be willing to preserve our employment by simply accepting lower wages?
Frank Pio Russo.