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Trade Unions are Destroying SA

22 January 2013, 10:05

As South Africa is rocked by more strikes and the same old rhetoric by our highly politicised “militant” trade unions, is it not time that we perhaps rethink labour relations? Perhaps we should consider a free market inspired approach that liberates entrepreneurs and businesses to create jobs without fear or favour from unions only interested in promoting their own interests.

What South Africa needs, is to stop seeing our country as a pie that needs to be divided up and shared in various elaborate ways. Instead we need to commit and work together to find ways to grow the pie so that there is more to share and that everybody proportionally gets more since there is more to go around. The most effective political system to grow a pie such as ours has unfortunately been proven time-and-time again to be capitalism.

It is not perfect, but it is the best the world has got at the moment. Splitting hairs over the current size of our nation’s pie and wasting valuable time and energy to find the most effective way to divide the current pie at the expense of competency and productivity means that the pie is only going to keep withering away, getting ever smaller. Being a hand-out state may keep voters loyal, but it certainly does not allow for a long term solution to our problems. But this is exactly the thing that everyone is too scared to say to the masses.

The truth is that the inequality of the past cannot be fixed in our lifetime. It is too big. The current generation of disenfranchised individuals will never rise above their current situation if there is not an emphatic drive to grow and re-industrialize the economy of this country.

Anybody standing on a soap box preaching anti-capitalism and making promises of economic freedom in our lifetime is unfortunately practising irresponsible leadership and will only strengthen the disillusionment of the underclass leading to a troublesome future. If we as a nation keep on resorting to highly politicised and militant trade unionism and keep on demanding that we continue to spend all our effort to try and correct the current imbalances we will in the process drop the ball for future generations and the cycle of poverty will never be broken.

It is estimated that by 2020 China’s minerals-intensive industrialisation phase will be complete. This means that the artificial spike in mineral costs we have been enjoying over the last few years that has indirectly been bankrolling so much of our hand out state would be gone and the ANC will have to cut back on grants since they will not be able to afford it anymore.

The only way to counter this outcome is by growing our economy and educating our citizens at an unprecedented rate in order to grow vital skills in other sectors that will take the economy forward. But of course free market growth is seen as a white invention that according to the propaganda machine of the unions (and the ANC) should be feared and desperately fought off.

So since there is widespread ignorance on the need for growth and since our education is failing, combined with the fact that we are not growing any real other industries and skills it follows that South Africa could in 7 short years have a complete and utter meltdown. If one of our biggest sectors is severely impaired in 7 years it is vital that we at least double the size of our economy in that same time to absorb the impact so that we can at least be able to sustain our citizens at current levels.

This in itself requires a consistent growth rate of at least 8% for that period to make it into a reality, and a much tighter fiscal policy. It is a bitter pill to swallow, especially given our past and considering how much the worker class has already given to this country, but unfortunately labour will have to stand up one last time and put the greater good above themselves if they wish for their children to have the lives they always dreamt about.

Productivity and growth cannot be undermined much longer by politicized trade unionism with ulterior motives. We as a nation need to work harder in the next decade than we have ever worked, otherwise there will not be much of a country left.
What South Africa has is an oversupply of unskilled labour. The only thing except our mineral resources that we can offer the world at this stage is more abundant low level labour than what they have in their own countries. But that is only a sellable commodity if it is also cheap.

We therefore need to embrace relatively cheap labour in much the same way as both China and India did, in order to industrialize and grow our economy for future generations so that we can develop other more sophisticated and rewarding industries that we can offer the world so that we will not have to indefinitely rely on such am inhumane differentiator as abundant low-cost low-level labour. Currently we are doing the exact opposite of what we should be doing.

Our politicized unions are actually artificially spiking the one differentiating factor we have by making our own labour too expensive for us to truly leverage on a global stage (in the process growing the country for future generations). Our competitive advantage is being eroded away every time excessive increases are demanded and productivity is lost due to strike action.

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