The Pen is mightier than the sword, but the Pen must sometimes move the sword against corruption if the corrupt are not moved by the pen.. An idea without an implementer is useless. "The Rulers do not carry the sword in vain"Rom 13:4

Saturday, January 9, 2016

ELEXTROLUX ORANGE- A strategy to save the jobs and the enterprise.

Electrolux makes 1,300 fridges and freezers everyday at the plant to be sold under its name and brands including Westinghouse and Kelvinator, and contributes more than $70 million to the local economy each year.

So, well might we ask,  "Why" is this vibrant factory closing down in 2016?

Do they sell much product?     1300 units per day is not too shabby!

 But we have to look at the trend as seen in the figures above which are from the Electrolux annual report for 2014.


In an a globalized economic rationalist world, and when faced with a debauched and opportunistic competitive and adversarial political system rife with industrial relations scams... damn little!

But in the world or Nation that FORTITUDE will create, there's plenty!

Before outlining how this could be done, let's note some problems.

i) Electrolux made the decision to relocate the manufacturing of all these products in Thailand. Why? Cheaper labor.  Why is it cheaper over there?  Probably because the Government has more interest in being competitive, than it has in giving a wage wish list to the average Joe and Jill worker that ends up destroying that competitiveness and the enterprise.

Perhaps more importantly... why would 'labor cost' be the predominant reason for leaving Australia in a $70million per-annum hole?  The total cost is actually double this, because our economy will have to find that money to just break even with now, which means we don't only 'lose' that amount, we also lose the same amount again as we try to cover the mess!  LABOR cost is 'high'....because trade Unions only see one color, 'red'....they see their only role as being to ramp up the wages and conditions of 'workers' or.. 'their members'. In the case of Electrolux, it's the AWU Australian Workers Union.

THE CASE (High Court)

You don't need to read far into this case to realize that if you were an employer.. you'd be ripping your hair out saying "Why the hell do I need this?????? nope..the Union can screw itself, we'll go to Thailand and bugger them all"

The case seems to be about forcing non Union workers to pay Union fees. "Bargaining Agents Fee"


1) Nationalize the Factory.. (Anarchist/Socialist approach)   Take control of the 'means of production' and make it a worker owned coop/enterprise.     This won't work for a trillion reasons! (Mondragon/Fagor)

2) Buy Out the Factory,   it will become an enterprise that includes worker investment and share holding (they'll have to chip in big time from their own resources) 

i) Firstly, the parent company, having made the decision to supply the same market from production in Thailand, will not want to sell. (either the plant and equipment or the brands)
FTA We do have a free trade agreement with Thailand via our FTA with the ASEAN block. It might be possible to get in quickly and establish the worker/staff ownership before the new plant is built in Thailand ? This might just keep us out of trade hot water under this FTA.

iii) UNIONS will be utterly verboten in the bought out company. Pay will be established such that the enterprise will be profitable, and workers with shares will participate in that profit.  (tying their work place performance directly to personal benefit)

I guess this means that the so called Fair Work Act would need to be shredded and replaced with something that actually works in the National Interest

Speaking of which… the only reason I can conclude as to 'why' little is being done by the Government to remedy this is a) Their commitment to 'free trade' and they might see more 'economic' advantage by having access to new markets for things like Beef etc.. (which translates into National Party constituents benefit) 

We have a FTA with Thailand via ASEAN. This probably means we cannot make decisions here which are prejudicial to Thai economic interests. But if we get in BEFORE they have that interest ?  hmmm (like establishing an Electrolux factory in Thailand)

As I look at the details of that FTA with Asean/Thailand…I my political nose is smelling 'benefit for the politically connected' rather than general benefit for the economy.

iv) WHERE could the funds be found to buy out this plant?  hmm ok..well perhaps if Daniel Andrews (to use my favorite whipping boy at present) had not scandalously wasted $20million on Tennis Promotional logo's etc that now cannot be used, and if he had not cost us $650 million for work that will not not be done (East West Link) and if we were not paying around $500,000,000 per YEAR in interest on our net debt and unfunded liabilities…  wow..there would be OODLES of spare money to do what I'm proposing (this is Vic alone)  The interest situation equally applied to the Napthine clowns who did little to fix it, but were at least heading in the right direction!  Except that revenue was tanking along with decreased spending making the net effect nowhere near where it needs to be to have an impact on our net debt.  (The graph below is from the Libs 2014 outlook)… oh I can't wait to see the Andrews version of the same thing at the end of next June!

THE END DRAWETH NIGH... is the kind of sign that loony tunes religious nitwits display up and down the street. Usually based on some dingbat theology from Clarence Larkins 'Greatest book on Dispensational Truth"  But for Aussie manufacturing and jobs, there is an absolute, etched in stone tablets future.. 'DOOM' unless we can demonstrate an effective method of making an enterprise work economically in Australia.  This HAS to mean cuts in wages, improvements in efficiency's (usually means machines and lost jobs)  because aside from this..there IS no future for Australian Manufacturing. (except mine which is 98% export to a niche market) but I don't employ anyone!  My business could not afford it.
This could mean an expansion of innovative enterprises which rely on massive automation, and less employees who can probably attract much better pay than a simple process worker.  The only way to have MORE of these higher paying jobs is by having more innovative, automated industries. That leads directly into my own "Higher Education Policy" which is to match the best professors with the brightest students as an 'overlay' on the existing system, to produce 'super' innovators based on science.

FORTITUDE will save you!  (not Andy Fleming, Antifa  or "Aussie" or John Symonds who saves himself alone, in my opinion)

SPECIAL NOTE to my anarchist mate Andy Fleming.. "have fun with this Andy"

No comments:

Post a Comment

Please make comments here. Vulgarity or namecalling will not survive the moderator. Reasoned argument alone will survive.