Tasmanian Times

The individual has always had to struggle to keep from being overwhelmed by the tribe. If you try it, you will be lonely often, and sometimes frightened. No price is too high for the privilege of owning yourself. ~ Friedrich Nietzsche

The individual has always had to struggle to keep from being overwhelmed by the tribe. If you try it, you will be lonely often, and sometimes frightened. No price is too high for the privilege of owning yourself. ~ Friedrich Nietzsche

Cartoons

Bonding …

Lukas

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1 Comment

1 Comment

  1. Gerry Mander

    February 28, 2009 at 11:18 pm

    I wish to play Devil’s Advocate here.

    The closing of the Bond company in Australia and moving the operation abroad, and the matter of executive salaries are two entirely unconnected entities. They are only linked emotionally and by those who wish to make political capital out of it, and that applies especially to the unions and political leaders, who are largly responsible for the actions of these executives in closing the company down.

    Firstly, we live in a competitive world where to survive, a company has to be profitable. The vast majority of all clothing worn throughout the world is manufactured in China, where wages are low and competition is fierce. There is no worker protection, but on the other hand, there are no mollycoddling of employees nor excessive penalties imposed by government and unions for anyone who wishes to run a successful business. ‘Entitlements’, superannuation, paid maternity leave, sickness benefit and employee taxes, etc, all add to the cost of manufacture and make most Australian companies uncompetitive. Despite this, neither unions or workers are willing to sacrifice or accept wages that would make this firm competitive. This would normally result in total bankruptcy of the business, especially in these current economic times.

    Executives are responsible to the shareholders and their salaries are decided by them. Not that I am saying, in many cases, they either do or do not deserve the high amounts that they get, but they are there to represent and work for the best interests of the shareholder; those who have invested their money in the company and are the owners of the business. If these executives, after weighing up the facts, decide that it is in the interests for the survival of the company to move it to a country where the labour rates are low and they can remain in business, this is the action they must take. The salaries they draw for managing this task may be cheap compared with the potential loss of everything if the company were to continue on their current path into forced liquidation.

    This is simply a fact of modern commercial life, and will continue until either China and its neighbours change their policies and upgrades and control the salaries of their workers, which seems unlikely when they are the only profitable and expanding economies on Earth, and by a large margin at that.

    However, as Asutralia is a largely union and labour dominated nation, it is unlikely that they will learn from this. They are more inclined to rage at Fate and demand compensation rather than take any real action which may lower their standards of living, but maintain their livelihoods. China is not a welfare state, so the inducement to work is a lot higher.

    As a note, a Chief Executive salary of $1.65 million is chickenfeed compared with some of the salaries drawn by members of the boards of bigger companies where the rewards do not bear any relationship to the difficulty of the job or the value of their contribution, and for which there can be no justification except sheer greed.

    In the case in question, even if the executives were not paid these rather handsome amounts, it would make no difference to the outcome, and if distributed among the workers, as the unions would like to see, the benefits to each would be negligible.

    It is a situation which will become increasingly more frequent as companies struggle to survive and where the choice is either to lower costs, or go to the wall. It is not a new situation and has been happning on an increasing scale over many years, as most of our manufacturing and finished-goods industries have relocated to labour-cheap countries. We are over-priced and cannot survive in this economic climate. This pattern is the future of Australia, a country that is dependent on export of basic resources for its survival and hardly at all on manufacturing. Coal, iron ore, gas, minerals, woodchips etc., make up the majority of our budget. Even a large proportion of our food is imported. Okay in good times, but a policy of unelightened suicide in bad times. We have put ourselves in a position where we are totally dependent on foreign imports, debt and credit for our very existence.

    The writing is on the wall. Only ostriches can fail to see it. Wake up Australia, before it is too late!!!

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