Union Bosses Define Capitalism: A flop?

Union bosses are preparing to get together at an “all-expenses paid by workers” conference in South Africa under the umbrella of the World Federation of Trade Unions (WFTU) from 8 to 12 February 2012. The theme for this gathering is “Capitalist Barbarism, Crisis and Imperialist Wars or Socialism”. What a shocking contradiction!

What do union bosses mean by capitalism? Are unions classless organisations? Can socialism provide a better life for workers whose interests are represented by union bosses? I will not attempt to answer all of the questions that can arise from the above theme but will try to illustrate a few scenarios that can logically and empirically explain some of the concepts.

Firstly, “capitalism”, “free enterprise”, “free markets” and “economic freedom” all mean the same thing: voluntary exchange between individuals free of third party intervention. This should be the same principle under which WFTU operates with its affiliated South African members: the National Union of Metalworkers of South Africa (NUMSA), the National Education, Health and Allied Workers Union (NEHAWU), the Police, Prisons and Civil Rights Union (POPCRU) and the Chemical Energy Paper Printing Wood and Allied Workers Union (CEPPWAWU) who, with WFTU, are all hosting the conference.

On looking at each of these unions’ websites there is a call for members of the public working in the given sectors to voluntarily join the respective union. In doing so, such a worker accepts to pay an annual membership fee and in return will receive all the benefits offered by the union. As it stands now, this is a voluntary transaction. If the union bosses go ahead with recent proposals and convince union members to support a state controlled socialist system, this current voluntary exchange will be overthrown and replaced so that everyone working in any sector will be forced by the government to become a member of a trade union, even if they do not choose to do so. Alternatively, or additionally, unions will be banned or heavily controlled, as they have been in all socialist or communist countries.

The call by union bosses for the capitalist class society to be overthrown infers that the unions are classless organisations where everyone associated with them are equal and receive equal earnings. All other organisations, businesses and entrepreneurs for whom the majority of union members work for are portrayed as anathema.

A classless society has never existed and can never exist for logical reasons: every individual on this earth has different skills, potentials, abilities and interests, and every profession pays a different reward. For example, even if an economics professor would like to earn the rewards of a football star, the market does not allow for that to happen. Instead of calling for the overthrow of the capitalist class, the union bosses should be calling for the proper maximisation of the skills of their individual worker members and that they should be adequately rewarded according to their skills.

Socialism has already been tried and it has failed in many parts of the world. For union bosses to now propose socialism as a solution to the current world crisis is short-sighted and misleading.

Today, South Africa grapples with the plight of the unemployed. More than 6-million individuals of the economically active population are currently unable to find work. As the Union bosses meet under the watchful eyes of their political partner leader and President of South Africa, President Jacob Zuma, we will be curious to see whether the President will be critical of the solutions proposed by union bosses in the interests of the unemployed.

The theme of the conference would be more apt if it was turned around to read “Socialist Barbarism, Crisis and Imperialist Wars or Capitalism”. If this was so, union bosses could, instead of wasting their workers’ contributions and the country’s time and money calling for a failed system to be re-introduced, rather be showing government that, as already evident from their very own operating structures, voluntary trade and transactions are the most efficient method to use to allocate resources.

All proud South Africans would prefer to earn a dignified income from work rather than depend on a socialist state government grant. Jobs would quickly become available if union bosses pushed government to focus on unlocking the entrepreneurial potential of the unemployed even if it means decreasing statutory protection for the unions and reducing labour market regulation. They could go even further and demand that the government improve the economic climate of SA by taking proactive steps such as decreasing trade regulations.

If, instead of gathering at their members’ expense to beat a broken drum, union bosses displayed the courage, wisdom and foresight required to lead the workers, whether currently employed or unemployed, to a better and more rewarding future, calls to unleash this country’s entrepreneurial potential would go a long way towards increasing employment opportunities in the country and giving back to all South Africans dignity and hope for the future.

Author Vivian Atud is an economist with the Free Market Foundation. This article may be republished without prior consent but with acknowledgement to the author. The views expressed in the article are the author’s and are not necessarily shared by the members of the Foundation.

FMF Feature Article/ 6 February 2012