Tag Archives: Bailout Package

COVID-19 and the role of Labor and trade unions in Australia | Instant News


COVID-19 and the role of Labor and trade unions in Australia

By
Mike Head

April 16, 2020

In the global coronavirus pandemic, workers and young people in Australia, as in every country in the world, face crucial political problems amid worsening health, economic and social disasters.

In combating mass unemployment, financial ruin, and danger to their health and life in many workplaces, the main political obstacles facing the working class are the Labor Party and trade unions.

It was not only employers and the Liberal National Coalition government that urged workers to return to work in unsafe conditions, but Labor and trade union bureaucracies. They worked hand in hand with Prime Minister Scott Morrison and his ministers, including to provide billions to employers and banks whose workers would inevitably be forced to pay.

People who work watch with shock, disgust, and increasingly angry scenes of mass death in the US, Britain and continental Europe produced by indifference and response driven by profits from governments at the world’s capitalist headquarters.

Despite premature and misleading claims about “leveling the curve” of infection, workers know that similar scenes can quickly emerge across Australia. The danger was demonstrated by the COVID-19 outbreak in places such as Tasmanian hospitals, Victorian health services, and elderly and disability care facilities in western Sydney.

This pandemic is an accusation against the failure of the capitalist system, which subordinates everything, including human life, to the conditions of profit from the financial elite.

But Labor and trade unions are determined to sustain this greedy social order in every way, including by helping employers cut jobs, wages and conditions during the pandemic and so on.

That was explained very clearly when Secretary of the Australian Trade Union Council (ACTU) Sally McManus appeared on national television on April 5 to promise employers that, in terms of cutting salaries and provisions, “you can get everything you want through cooperation” with the union the worker.

The Labor Party has formed a virtual power sharing regime with the Morrison government. Labor leader Anthony Albanese and his shadow minister meet weekly with their government colleagues, behind closed doors, to help design government steps.

Labor also holds a majority in Morrison’s “national cabinet” of state and territory government leaders, who effectively govern the country by decree, exercising broader emergency powers.

In just one month, with full support from Labor and ACTU, the Morrison government has provided big business with more than $ 325 billion in tax concessions, subsidies, grants and loans. This downgrades the totally inadequate amount allocated to public health facilities and mass testing is urgently needed to combat the corona virus.

The ruling class will demand that every penny be revoked from the working class by deeper cuts in social spending, increased taxes, reduced salaries and provisions as well as further privatization and asset sales.

Fearing widespread social unrest, it is necessary for Labor and trade unions to try to suppress growing opposition in the working class, including among teachers, child care workers and construction workers.

To sustain their lives, livelihoods and futures, workers and youth must carry out political struggles against workers and union apparatus. That means seriously reviewing the history of the Labor Party and drawing the necessary political lessons.

There has been widespread hostility to the Labor Party and trade unions as a result of decades of betrayal, especially since the Hawke Agreement and the Keating Labor Agreement in the 1980s and 1990s.

Union membership has shrunk to less than 10 percent of private sector workers. Among young workers, under the age of 25, the figure is only 5 percent.

The base for supporting labor elections has also collapsed. In the federal election last May, his vote dropped by 33 percent – the lowest level in a century – although the Coalition’s vote dropped as well. For good reason, millions of workers simply do not believe that Labor falsity promises to get a “fair path” from the wealthy elite.

But anger and disgust are not enough. Those who voted to try to pressure Labor to improve their ways would be very disappointed. The only response to the election disaster was to shift further to the right, led by Albanians, who promised to increase “wealth creation” and appeal to “successful people.”

Now he is at the forefront of sustaining the capitalist system even as workers become aware that he places profits above all, including the health, welfare and life of the population, and begins to consider socialist alternatives.

This is not merely a problem of Labor leaders and trade unions that are corrupt or poor, but rather the whole perspective of the Labor Party.

Since its birth, which was formed by trade unions in the 1890s, Labor was committed to defending the nation’s capitalist nation state, giving the racist ideology of the founder of “White Australia.”

The workers’ leaders always insisted that there was no need to overthrow capitalism because the working class could improve its destiny through the struggle of the militant unions or by electing the Labor Party. Within a nationally regulated economic framework, the ruling class can be pressed for concessions.

Relying on prospective labor bureaucrats and parliamentary careers, the Labor Party strongly rejects the struggle of the Marxist movement for the struggle of a global united worker to overthrow capitalism and reorganize society for the benefit of all, not personal gain.

That is why Labor is called to take office in every major crisis of capitalist government. During the world war and the Great Depression of the 1930s, companies in power in Australia turned to the Labor government, which was supported by trade unions, to uphold the sacrifices of life and livelihoods needed.

During the post-World War II boom, the capitalist class was able to make limited concessions to prevent the struggle of the working class. But the national reformist program of the Labor Party and trade unions was destroyed by the globalization of production from the 1980s, which allowed transnational companies to easily move their operations from one country to another to secure lower labor costs.

The Hawke and Keating Agreement marks the transformation of Labor and trade unions, like their counterparts throughout the world, into tools that work to reverse the past profits of the working class to help make “their” national capitalist economies “competitive” in the world. market.

It is no longer a matter of urging employers to give concessions to workers, but rather trade unions who arm workers for “exchanges” to ensure employers continue to benefit.

Today, we see the final product of that process. For Labor and trade unions, workers must be rehired as soon as possible so that their workforce can be exploited once again, even if it means countless deaths.

Conclusions need to be drawn. The corona virus pandemic graphically shows that there is no possibility of reforming the capitalist system in Australia or anywhere in the world. Assisted and abetted by all his political servants, including the Labor Party and the union apparatus, the ruling class was willing to let hundreds, thousands, even millions die to ensure the flow of profits for a handful of rich people.

This social order does not deserve to be continued and must be overthrown. The working class is the only social force capable of carrying out this historic task and building a socialist society.

Instead of big business and banks sustained by the intervention of the capitalist state, they must be placed under public ownership and control of democratic workers. This means the working class must take power from the hands of the financial elite and reorganize society to meet the immediate needs of the majority of the community, not a handful of rich people.

Instead of capitalist countries fighting each other over resources and profits, it is important to form a working government that works together in a globally coordinated response to threats to humanity presented by coronaviruses.

An important lesson from all of the 20th century’s strategic experiences is that to overthrow capitalism, a revolutionary party is needed to educate, mobilize and lead the working class in the struggle for power. That is the perspective of the Socialist Equality Party and its twin parties in the international world. We urge our readers to join the SEP to continue this struggle.

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Unemployment is already at the level of the Great Depression in Australia | Instant News


Unemployment is already at the level of the Great Depression in Australia

By
Mike Head

April 16, 2020

Afraid of social and political unrest, the Australian government has been trying to hide the widespread unemployment rate in the working class over the past month, accelerated by the deteriorating impact of the global pandemic COVID-19.

Treasurer Josh Frydenberg issued a media release on Tuesday saying the Treasury analysis estimated the official unemployment rate would peak at 10 percent in the June 2020 quarter, nearly double the 5.1 percent recorded for February. However, he did not publish the analysis.

Even the forecast will show enormous financial difficulties and social pressure. That means nearly 1.4 million people lost their jobs, an all-time record for Australia.

But this figure does not include workers who are now “under-employed”, especially casual workers, who have lost most of their paid work hours. And official statistics are too low.

Roy Morgan’s company survey last month found that unemployment for the second half of March jumped 1.4 million to 2.4 million (16.8 percent) and underwork increased by 374,000 to 1.52 million (10.6 percent).

In total, a record 3.92 million workers, or 27.4 percent, were unemployed or unemployed at the end of March.

Queues outside Centrelink’s office in Sydney last month

This surge resulted in a queue of the style of the Great Depression outside the Centrelink government welfare offices throughout the country, when dismissed workers lined up to apply for payment of benefits.

Roy Morgan CEO Michele Levine described it as “the biggest shock to the Australian economy, and the workforce, since World War II – far beyond the lives of most Australians.”

Today’s official unemployment rate, showing an increase to 5.2 percent, came from mid-March. That was before the partial lockout of COVID-19, which was too late to be ordered by the federal, state and territory governments, deepened the slump that had taken place due to the summer fires and the decline in global capitalism.

In a media release on Tuesday, Frydenberg claimed: “The historic $ 1,500 JobKeeper payment every week from the Morrison government will support millions of Australian jobs when we build bridges to the other side after the severe economic impact of coronavirus.”

Except for the $ 130 billion “JobKeeper” wage subsidy scheme for employers, the treasurer said the unemployment rate would be 5 percentage points higher, peaking around 15 percent.

There is no basis for this claim. Frydenberg said 800,000 businesses, including self-employed sole traders, had applied for the JobKeeper scheme, but did not provide statistics on whether employers had kept workers on the payroll as a result.

Asked by a journalist if the government had a record of employers who did that, he did not give an answer. In a question at a press conference, he stated: “I don’t have a fixed number because what percentage of those people will resign and what percentage of those people will continue to work.”

Although this is an unprecedented offer to save business, the $ 130 billion scheme of the Liberal-National government will never be sufficient, or impact fast enough, to prevent mass unemployment.

This scheme not only excludes around 1.1 million casual workers and 1.4 million foreign workers on temporary visas, payments to employers do not begin until next month.

Many businesses, especially smaller ones, will not last until then. Others, especially large employers, might keep workers in their books but exploit the scheme to cut their wages to $ 1,500 every two weeks and impose massive cuts on conditions, such as leave entitlements and penalty pay rates.

That is the main purpose of the bailout package, aside from disguising the unemployment rate. Supported by the Labor Party and the Council of Trade Unions of Australia (ACTU), a law pushed through parliament last week amended the Fair Employment Act to enable employers to carry out such actions.

At the same time, ACTU secretary Sally McManus said the union had told employers that they could “get everything you want” with union cooperation.

Despite all of these efforts to shore up a bankrupt capitalist order, the latest National Australia Bank (NAB) business survey, released on Tuesday, reports that business confidence dropped to minus 66 points. This is far worse than other records since the survey began in 1989 and far deeper than minus 30 points in 2009.

Such a collapse in self-confidence is another warning sign of a demand that has evaporated, investment has fallen, company bankruptcy, and further job loss.

NAB chief economist Alan Oster said: “We expect a recession of unprecedented speed and magnitude for the Australian economy over the next three quarters. This will see a sharp increase in unemployment.”

Referring to the government’s “stimulus” measures, totaling more than $ 320 billion in grants, tax concessions, incentives and loans to corporate elites, Oster said: “Policy makers have made large responses that we think will not be able to offset our negative print will see in economic data in the near future. “

Oster said the NAB remained “optimistic” that government steps would “support a solid recovery after the virus was contained.” “Optimism” is refuted by what happens around the world when COVD-19 mortality rates increase.

Government efforts to cover up the job massacre were even more revealed yesterday when the International Monetary Fund (IMF) issued dire predictions for global capitalism and Australia.

The IMF has estimated the biggest devastation in the world since the Great Depression of the 1930s, with global output falling 3 percent in 2020-30 times more than during the 2008-09 economic disruption.

Because of Australia’s capitalism dependence on exports of raw materials, tourism and income from international students, the IMF expects a 6.7 percent decline in the country’s gross domestic product (GDP) for 2020, the biggest decline since a 9.4 percent decline in 1931.

Severe unemployment and impoverishment faced by workers and young people in Australia are not just products of local coronavirus restrictions. Instead, it shows the vulnerability of Australian capitalism to the global crisis triggered by the pandemic.

The IMF predicts a sharp decline in all capitalist centers, including the US (-5.9 percent), Europe (-7.5 percent), Canada (-6.2 percent) and Britain (-6.5 percent). It said China, whose massive stimulus measures in 2008-09 prevented recession in Australia by increasing demand for iron ore and coal, would record growth of only 1.2 percent this year, well below the level of a decade ago.

The IMF expects a V-shaped rebound next year, including 6.1 percent in Australia. But it is based on the assumption that the government will end restrictions on social distance in the second half of the year, thus encouraging workers to return to work.

The Fund warns that this “baseline” scenario will reverse if the pandemic lasts longer, leading to an extension of the detention period, deteriorating financial conditions, and further disruption of the global supply chain.

IMF chief economist Gita Gopinath said his estimates were very uncertain. “Many countries now face many crises – health crises, financial crises, and falling commodity prices, which interact in complicated ways.”

Long before the catastrophic forest fires and pandemics, corporate investment dried up in Australia, and workers also faced a decline in real wages, soaring rates of casualization and the highest level of household debt in the world.

Now, as a result of capitalist governments failing or refusing to respond to the dangers of COVID-19 in time to save thousands of lives, workers lose their jobs, many cannot pay their rent or mortgage and their lives are threatened by demands from the government and companies to return to work , regardless of unsafe conditions.

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The IMF is delaying the review of the two $ 6 billion bailout packages for Pakistan, Pakistan News | Instant News


The IMF has postponed the review of the two $ 6 billion bailout packages for cash-strapped Pakistan scheduled for Friday, citing delays by the state in implementing agreed upon actions, a media report said on Tuesday.

The International Monetary Fund Executive Board approved a $ 6 billion three-year loan package for Pakistan in July last year to curb rising debt and prevent a shadowing balance of payments crisis, in return for difficult austerity measures.

Pakistan approached the IMF in August 2018 for a bailout package after Prime Minister Imran Khan’s government took over.

Apart from loans from China, Saudi Arabia and the UAE, Prime Minister Khan’s government was forced to turn to the IMF because of increasing economic problems.

The IMF has confirmed the delay in reviewing the two bailout packages but said its priorities have now shifted to the approval of a $ 1.4 billion fast financing facility.

The Ministry of Finance told The Express Tribune that the IMF did not notify him of the delay in approval of the second review of the 10-month loan program.

In February, Pakistan and the IMF agreed that the fund’s executive board would approve a second review for the release of a third loan phase of USD 450 million on April 10, subject to the fulfillment of all conditions by the Pakistani government.

Sources said the IMF board would not accept Pakistan’s request for approval of a second review for the October-December 2019 period under the Extended Fund Facility (EFF) on April 10.

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