Unions out of sync with economy 0
The news out of Europe this week regarding their sputtering economy was rather bleak. Not only are countries like Greece and Italy teetering on the brink of bankruptcy, but also the unemployment rate in the European Union is now more than 11%. In countries like Spain, almost 25% of their entire population is out on the street looking for work.
In Canada, most of us believe we can afford to sit back and watch as our European cousins struggle to get their financial house in order. We boast about our strong banking system and exports of raw natural resources that help to maintain our high standard of living. But if you truly believe we are in a position to smugly look down upon our overseas neighbours, think again.
If it were not for the extraction of natural resources such as oil, coal and natural gas, would Canada really be an economic powerhouse? Many leading economists remain skeptical.
Strip out raw material exports and Canada suddenly becomes just a middle-of-the-pack nation struggling with a serious productivity problem. That's why this is not the time for any level of government to open up the wallet book and undertake a massive spending spree.
Unfortunately, the need to keep costs in check appears to be lost on a growing number of public sector unions in the Western world. That includes right here at home in British Columbia.
For example, unionized liquor store employees belonging to the B.C. Government and Service Employees' Union are on strike this week demanding even higher wages and better benefits. This is despite the fact union officials openly admit unskilled employees in government liquor stores make starting wages and benefits well above similar jobs in the private sector.
The BCGEU argues that liquor stores are making Victoria lots of money; hence they deserve a bigger slice of the pie. But what they fail to acknowledge is that government makes profits off the taxes they charge on alcohol, not on who actually sells the product. Having public versus private sector employees sell liquor actually cuts into government's bottom line.
As we head into what appears to be a decade of economic malaise, now is not the time to look at socialist countries like Greece or Spain as models for our economy. Meanwhile, governments of all stripes must soon decide if they should focus on delivering core services or remain in the liquor retailing, golf course and car insurance selling business.