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Blinding Rhetoric

15 Aug 2012

Think “juicy steak”. Unless you are a vegetarian, your mouth watered or your stomach told you that you were hungry. “Juicy steak” is a phrase that triggers physical and emotional reactions; it will blind you from thinking clearly about anything else…at least for a minute or two. CEOs who run around tossing out phrases like “surging labour costs” and “lower productivity” are using the “juicy steak” strategy—they want to trigger emotional responses that blind people.

So, when you read this report in the Financial Review about a survey of the CEO Forum Group:

International companies have warned the Gillard government that they may scale back investment plans in Australia due to carbon pricing, surging labour costs, the high dollar and political uncertainty.

Leading executives of multinational corporations claim that Australia’s business-friendly reputation is at risk and parent companies could shift resources to Asian nations.

…Membership to the forum is restricted to the country head, chief financial officer and top human resources executive of multinational subsidiaries operating in Australia, including Coca-Cola, KPMG, Credit Suisse, Citibank, Accenture, GM Holden, Colgate-Palmolive, Campbell Arnott’s, BP and GlaxoSmithKline.

Remember this:

1. The heads of these companies make millions of dollars in pay and benefits and not a one—not a single one—has offered to give back a dime of their obscene compensation.

2. “Surging labour costs” is a crock, if you look over the course of several years. The actual official statistics at the Australian Bureau of Statistics shows that over the period 2008-2011, compensation averaged about 4.4 percent—at the same time that housing costs alone rose more than 3 percent and other costs to just live rose as well, eating up any compensation hikes in real terms. Just in the past quarter, price rises for  medical and hospital services increased 2.8%, rents 1.1% , and vegetables +5.2%. Bottom line: people are not living high off the hog.

3. Not to mention, forty percent of Australians are in insecure work.

4. Carbon pricing, as the Prime Minister correctly pointed out recently, has very little to do with higher electricity prices—which are higher for a whole set of reasons pointed out here.

5. A high dollar is a direct result of a resource industry boom that the elites have embraced without question—which could also be managed and controlled with the right policy…which would bring the dollar back down to a more sustainable level.

6. The threat to to shift production to Asian nations is a coded phrase that translates into “we want to go where we can find slave labor”.

The basic point is: there needs to be a countervailing message to destroy rhetorical themes that trickle into daily conversation, trying to convince people that what we need are more policies that give more to the elite and less to workers.