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January, 2007 From The Korea Herald January 6th, 2007Commentary
Get smart, or get Thatcher
By Chris Gelken
Trade unions, according to the Wikipedia definition, are; "A continuous association of wage-earners for the purpose of maintaining or improving the conditions of their employment."
I think the key words here are "continuous" and "maintaining" -- two things that many Korean trade unions appear to have no concept of. After the violence in Ulsan on Thursday, it is apparent that leaders of the Hyundai Motor Co. union could use the services of a good dictionary. Sure, everyone deserves a fair day's pay for a fair day's work. Unscrupulous employers who pay fat bonus checks to themselves and their top executives while crying poverty as they deny benefits to the blue collar workforce, well, they deserve to be brought down a peg or two. The smart employer is one who makes sure his workforce is happy and well fed. And in Korea these days, one that provides maternity benefits and a child care center. It helps guarantee continuity, stability, productivity and so on and so forth. All important things to a company's bottom line. The boss doesn't necessarily need to be a 24-hour cash dispenser for his staff, but being a bit too tight fisted isn't such a clever move either. Lurking out there on the shop floor are the union organizers. Make no mistake, they are reading the business dailies to check on the stock price and who got paid what and what for. Conspicuous displays of wealth are not appreciated by someone sitting on the bus after a 12-hour shift. If they think there is some surplus cash in the kitty, they'll be at the door demanding a fair and equitable share out. Korea's chaebol oligarchs probably still haven't fully come to terms with the concept of collective bargaining and a "reasonable" share-out of the spoils. The unions, meanwhile, have forgotten how to ask nicely, if they ever knew how in the first place. The global notoriety of Korea's unions pre-dates the entertainment phenomenon Hallyu -- and will probably outlive it too. But we have a conundrum. The first rule of capitalism dictates that a company minimizes costs and maximizes profit. The workers, remember, are cost, and the profit goes to the boss, his sons, and the shareholders. Korean conglomerates love that first rule. There has to be a common ground where both sides get something they can be satisfied with, though one side is usually more satisfied than the other. Going back a few years to another time and another place, it is hard to conceive the power that British trade unions held over the country and the government. After an economic upswing in the early 1960s, by the 1970s the economy was under siege and the enemy at the gates were Britain's powerful trade unions. It was a world almost turned upside down. For a relatively short time it was great for the blue collar wage-earners, they were often banking more than their employers. But industries, Britain's proud auto sector for example, began sinking into a decline from which some of them would never recover. But unions were implacable and continued to demand a bigger share of a shrinking pie. Britain simply became uncompetitive. The out of control union virus was killing the host. Unemployment skyrocketed. And then came Margaret Thatcher, Britain's Iron Lady of politics. Through a rapid fire string of anti-union policies and laws followed by a stand up and knock down fight with the coal miners' union, Thatcher dealt a blow to union power from which they too never recovered. It was ugly at times, and Thatchernomics allowed free rein to British business leaders to once again rule the roost, and roll back many of the benefits that workers once had. The gap between rich and poor widened. The pendulum had swung, from one extreme to another. Britain became profitable, a safe place to invest. After a few hiccups -- including rioting in the streets -- the good times began to roll. Korea certainly doesn't want to repeat the mistakes of Britain in the 1960s, '70s and early '80s. But then, it doesn't have to. British companies in those days didn't have many of the opportunities that Korean companies have today. Large among those opportunities is; if it becomes too costly to produce the goods at home, then the company will open a factory where it can realize the potential of the "first rule" to its maximum. Exhibitions of union-orchestrated violence such as we witnessed at the Hyundai Motor Co. New Year's ceremony in Ulsan, did more to strengthen Hyundai's resolve to move production and jobs overseas, than it did to maintain or improve the conditions of their Korean employees. It will be fun to see how quickly the government changes the tax regime when Hyundai cars become an import. (chrisgelken@heraldm.com) TrackbacksThe trackback URL for this entry is: http://chrisgelken.spaces.live.com/blog/cns!2ED692167BC7EF1F!260.trak Weblogs that reference this entry
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