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Keith Rankin: Revolting Vets?

Revolting Vets?

Keith Rankin, 22 February 2001

The strike by the veterinary inspectors at our export meat works enters its 7th day today. Are our salaried vets at the vanguard of a wage and salary earners' revolt? Or are they more like greedy Dickensian capitalists, plucking the food out of the mouths of others?

Almost all economic conflict is some kind of scrap over a 'surplus'. For our purposes, a surplus can be thought of as a pool of income in excess of what is necessary to maintain a 'subsistence' standard of living. And 'subsistence' can be thought of as a society's poverty line. The fact that some societies have a higher subsistence standard of living than others simply means that they have in the past been able to both generate substantial economic surpluses and distribute them with some degree of equity.

There can be no doubt that some of the largest surpluses in New Zealand have been generated through the production and export of products such as wool, lamb, beef, butter and cheese. Hence many of our industrial disputes have been linked to the competing claims of those who participate in the distribution of such products.

When our surpluses are comparatively small, we tend to avoid confrontation; we are grateful to earn enough to subsist at the standard of living to which we have become accustomed. (There are contests over small surpluses. But covert tactics are required. Insiders are always, it seems, doing secret deals and fait accompli in order to raise their shares of dwindling surpluses. The directors of Contact Energy tried it a few weeks ago, but did not succeed with what they thought was a fait accompli to raise their fees despite falling profits.)

When large surpluses appear, Hobbesian economic man appears; individual greed is prone to prevail over collective common sense. A pile of gold coins in the corner of the room, once spotted, tempts most of us in the room to become 'rent seekers', a somewhat stronger term than 'profit maximisers'. (The same rent-seeking impulse - combined with a craving for attention - makes too many of us want to participate in television programmes such as Survivor and Treasure Island that use conflict to boost ratings.)

A large surplus provides an opportunity for exploited workers to revolt. But it provides an even better opportunity for non-exploited workers to revolt. Non-exploited workers have greater reserves; they can wage war on the others who have a claim on that surplus for longer than can workers without savings. A surplus can vanish if any one group responsible for generating that surplus is able to withhold its contribution. Bargaining power is heightened both by the existence of a large surplus and by that group's ability to make a credible threat to destroy the surplus.

It is now 50 years since the great waterfront strike/lockout of 1951. Thanks to the huge rise in the demand for wool on account of the Korean War, there was a massive surplus for stakeholders in the production and export of New Zealand wool and wool products. The wharfies acted to claim a portion of their rightful share of that increased surplus. Problem was, they had two very strident opponents - the Government and the Federation of Labour - in addition to the firm opposition of the British shipping companies who had assumed that the lions' share of the surplus would be theirs. (Waikato University historian Anna Green has just published a book - British Capital, Antipodean Labour - on this episode of New Zealand's history.) The wharf workers were defeated; the other parties successfully acted to ensure that the wool reached its markets. The surplus on offer was too big to allow the wool clip to rot on the wharves.

So what about the MAF (Ministry of Agriculture and Fisheries) veterinarians in 2001? Our traditional pastoral export industries have been generating a substantial surplus so far this year, thanks to a combination of favourable weather, low exchange rate and higher than usual overseas demand. The vets have considerable bargaining power. Past incomes between two and four times the national average make it possible for them to withhold their labour for a long time. The surplus itself is a source of bargaining power; nobody wants to go without a share of the surplus by making a stand against any small group who makes a substantial claim. And the direct employer - the Government - is capable of meeting the vets' demands. If the vets had been employed by a subcontractor who could not meet the demand even if s/he had wanted to, their strategy would not have been seen as credible.

My impression is that the MAF vets are doing rather more than defending their share; they are seeking a permanent increase in the share of their industry's surpluses, not because their contribution is so much greater than that of other meatworkers, but because they have (or believe they have) the bargaining power to succeed. In that sense, they are behaving more like the shipowners in 1951 than the waterfront workers. Indeed groups of workers belong to the same species as groups of capitalists; each has the capability of destructive greed.

I would like to see some extensions to the Employment Relations Act (ERA). The first is the principle that all who contribute to the creation of a surplus should have access to an equitable share of that surplus. By the same reasoning, all who may be responsible for a reduced surplus in say 2002 should experience an income cut. (In other words bonus payments or special dividends are more appropriate than salary increases as a means to distribute a temporary surplus.)

The second is that, as part of the "good faith" provisions of the ERA, groups seeking an increased share of a surplus should publish a document that spells out their view of which groups should get a reduced share, and why.

This latter principle could be taken a lot further. If we all think of our incomes as being shares of some sectoral, national or global surplus, we should all be prepared to present a reasoned argument as to why our portion is appropriate, or why some other party should be willing to accept a reduced share.

In the case of the MAF vets, I have yet to hear who they believe should get a reduced share of the income generated by the meat industry. I am waiting to hear why they think ordinary freezing workers, or farmers, or shipping companies, or the Inland Revenue should have relatively less so that the vets can have relatively more.

© 2001 Keith Rankin []

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