John Singleton with Bob HowardRip Van Australia (Stanmore: Cassell Australia, 1977), pp. 251-53, under the heading “Unemployment”.

We have already discussed what happens when prices are fixed. When they are arbitrarily fixed too high, there is a positive incentive for producers to produce, but a negative incentive for consumers to buy. When prices are fixed too low — the reverse happens — production drops, but consumption increases. Therefore, the former situation results in a glut, and the latter in a shortage. The market price is the one where the market clears — supply equals demand.

Labour is a commodity on the market just as much as eggs, shoes and refrigerators are. Wages are the price of labour, and in our economy, most wages are fixed. They are fixed as a result of Union activity and conciliation and arbitration by the government. The laws of economics apply to labour just as they apply to other commodities. When the price is fixed too high, in this case the supply remains relatively unchanged — although some extra people may be coaxed out of retirement, schools, or colleges, or out of the family home to enter the labour market. The demand for labour, however, drops. Staff are laid off, automation is increasingly used, businesses close down. The end result is an unemployment problem.

We believe the main cause of unemployment today is that wages are not free to fluctuate in accordance with variations in the supply and demand for labour. There are, of course, other factors that complicate the picture, but we believe these are secondary. Such things as taxation, inflation, government activity (such as when government reduces tariffs suddenly, or devalues the dollar, or upsets a particular industry with new legislation) — all can produce unemployment. With free, floating wages, the employment demands of the people would force wages down until the unemployed who wanted to work were able to find work. It is only when wages are not allowed to fall that an innocent percentage find themselves in the situation of being part of the “permanently unemployed.”

Union activity that secures wage rises generally only secures a gain for one section of the labour force, at the expense of the jobs of people in another industry; or even within their own. The ability of industries to pay increased wages has all but been forgotten. With business being ravaged by high taxation, inflation, the Prices Justification Tribunal and general economic uncertainty, it is little wonder that one of the main results of recent huge wages increases has been record unemployment.

Once again, we see the results of government meddling in the economy. Government are responsible for taxation, inflation, economic uncertainty (because of arbitrary changes of policy), institutionalised economic dislocations, and fixed wages. Every one of these contributes to unemployment, and fixed wages, and ensure that they remain there.

Wages are paid out of production. Every employee on a free market is paid roughly in accordance with what they contribute to this production. If, through the introduction of better machinery, employee productivity is increased, then an employer can afford to raise that employee’s wages. Thus, a person who digs holes with a bulldozer can be paid more than one who uses a teaspoon. It is not how hard they work, or how long they work that counts. It’s what they produce that determines what they can be paid.

In Great Britain some time ago a Royal Commission was appointed to enquire into the causes of the bankruptcy of the Norton-Villiers-Triumph motorcycle company. One of the things they found was that, whereas in equivalent firms in Japan the motorcycle production was of the order of hundreds of motorcycles per man employed per year, in Norton-Villiers-Triumph they produced eleven per man per year. Such a difference might be acceptable if one is comparing Rolls-Royce with Holden. It is not acceptable when one is comparing Holden with Falcon. It was little wonder that the British company folded. Other factors that contributed to its situation were strikes, Unions resisting the introduction of more modern machinery, demarcation disputes, fixed wages and the inability to fire unnecessary labour — as well as the old favourites of taxation, inflation and red tape. It all has a familiar ring, doesn’t it?

Minimum wage laws, in particular, contribute to unemployment, particularly disadvantaging those who can least afford it: the old, the very young, and the unskilled. When the minimum wage is raised, all those whose productivity is not worth the new wage will lose their jobs. If the economic situation is bad, as it is at present, others lose their jobs as well, as companies trim corners so as to stay in business. The same analysis can be made of all wage legislation enforcing awards.

On a completely free market, wages could be determined by supply and demand. The popular misconception that without legislation, workers would be exploited, is not true. It is in an employer’s best interests to have a happy, positive, highly productive workforce. On a free market, workers would be paid in accordance with their worth: a good fitter and turner would get a higher wage than a bad one. To get the best workforce, an employer would have to offer high wages and good conditions. Ideally, employment would be via a job contract, which could be periodically renegotiated, with new wage rates being agreed upon.

Freely floating wages would also serve to determine the supply of people in various occupations. If there was a shortage of carpenters, for example, their wages would rise in response to demand. This would attract more young people into the trade thus forcing wages down again.

If unemployment benefits are guaranteed and are at an attractive level, they will act to increase and perpetuate unemployment. If, for instance, the unemployment benefit was fifty dollars a week, and the minimum wage was seventy-five dollars a week, someone working on the minimum wage is, in effect, doing a whole week’s work for only twenty-five dollars more than they would get for not working. This may be low enough for the minimum wage worker to decide it’s not worth it, and so toss in his job and go on the dole. It may also discourage others on the dole from bothering to get a job.

If the government refuses to leave the economy alone, experience shows that it can only avert unemployment (temporarily) by spending. This spending usually only adds to inflation, but it does buy the government a short-term respite. The basic causes of the problem have not, however, been attacked so it is not long before it once more rears its head. The longterm effect of government continuing to buy their way out of trouble while at the same time keeping the economy in their sticky grip can only be used as the excuse to impose such Draconian controls on the economy (“in order to get it back on its feet”) that we will have a fully fledged totalitarian State.

It is not possible to produce a healthy economy or full employment by legislation. Production pays for employment. Free enterprise, by maximising production, maximises both employment and wages. There is no other way.

(in order of appearance on Economics.org.au)
  1. Governments Consume Wealth — They Don't Create It
  2. Singo and Howard Propose Privatising Bondi Beach
  3. Singo and Howard Speak Out Against the Crackpot Realism of the CIS and IPA
  4. Singo and Howard on Compromise
  5. Singo and Howard on Monopolies
  6. Singo and Howard Support Sydney Harbour Bridge Restructure
  7. Singo and Howard on Striking at the Root, and the Failure of Howard, the CIS and the IPA
  8. Singo and Howard Explain Why Australia is Not a Capitalist Country
  9. Singo and Howard Call Democracy Tyrannical
  10. Singo and Howard on Drugs!
  11. Simpleton sells his poll philosophy
  12. Singo and Howard Decry Australia Day
  13. Singo and Howard Endorse the Workers Party
  14. Singo and Howard Oppose the Liberal Party
  15. Singo and Howard Admit that Liberals Advocate and Commit Crime
  16. Up the Workers! Bob Howard's 1979 Workers Party Reflection in Playboy
  17. John Whiting's Inaugural Workers Party Presidential Address
  18. John Singleton and Bob Howard 1975 Monday Conference TV Interview on the Workers Party
  19. Singo and Howard on Aborigines
  20. Singo and Howard on Conservatism
  21. Singo and Howard on the Labor Party
  22. Singo, Howard and Hancock Want to Secede
  23. John Singleton changes his name
  24. Lang Hancock's Foreword to Rip Van Australia
  25. New party will not tolerate bludgers: Radical party against welfare state
  26. Singo and Howard introduce Rip Van Australia
  27. Singo and Howard on Knee-Jerks
  28. Singo and Howard on Tax Hunts (Lobbying)
  29. Singo and Howard on Rights
  30. Singo and Howard on Crime
  31. Singo and Howard on Justice
  32. Singo and Howard on Unemployment
  33. John Singleton on 1972's Cigarette Legislation
  34. Singo and Howard: Gambling Should Neither Be Illegal Nor Taxed
  35. Workers Party Platform
  36. Singo and Howard Join Forces to Dismantle Welfare State
  37. Singo and Howard on Business
  38. Singo and Howard on Discrimination
  39. Singo and Howard on the Greens
  40. Singo and Howard on Xenophobia
  41. Singo and Howard on Murdoch, Packer and Monopolistic Media
  42. Singo and Howard Explain that Pure Capitalism Solves Pollution
  43. Singo and Howard Defend Miners Against Government
  44. Singo and Howard on Bureaucracy
  45. Singo and Howard on Corporate Capitalism
  46. The last words of Charles Russell
  47. Ted Noffs' Preface to Rip Van Australia
  48. Right-wing anarchists revamping libertarian ideology
  49. Giving a chukka to the Workers Party
  50. Govt "villain" in eyes of new party
  51. "A beautiful time to be starting a new party": Rand fans believe in every man for himself
  52. Introducing the new Workers' Party
  53. Paul Rackemann 1980 Progress Party Election Speech
  54. Lang Hancock 1978 George Negus Interview
  55. Voices of frustration
  56. Policies of Workers Party
  57. Party Promises to Abolish Tax
  58. AAA Tow Truck Co.
  59. Singo and Howard on Context
  60. Singo and Howard Blame Roosevelt for Pearl Harbour
  61. Singo and Howard on Apathy
  62. Workers Party is "not just a funny flash in the pan"
  63. Singo and Howard on Decency
  64. John Singleton in 1971 on the 2010 Federal Election
  65. Matthew, Mark, Luke & John Pty. Ltd. Advertising Agents
  66. Viv Forbes Wins 1986 Adam Smith Award
  67. The writing of the Workers Party platform and the differences between the 1975 Australian and American libertarian movements
  68. Who's Who in the Workers Party
  69. Bob Howard interviewed by Merilyn Giesekam on the Workers Party
  70. A Farewell to Armchair Critics
  71. Sukrit Sabhlok interviews Mark Tier
  72. David Russell Leads 1975 Workers Party Queensland Senate Team
  73. David Russell Workers Party Policy Speech on Brisbane TV
  74. Bludgers need not apply
  75. New party formed "to slash controls"
  76. The Workers Party
  77. Malcolm Turnbull says "the Workers party is a force to be reckoned with"
  78. The great consumer protection trick
  79. The "Workers" speak out
  80. How the whores pretend to be nuns
  81. The Workers Party is a Political Party
  82. Shit State Subsidised Socialist Schooling Should Cease Says Singo
  83. My Journey to Anarchy:
    From political and economic agnostic to anarchocapitalist
  84. Workers Party Reunion Intro
  85. Singo and Howard on Freedom from Government and Other Criminals
  86. Singo and Howard on Young People
  87. Singo and Howard Expose how Government Healthcare Controls Legislate Doctors into Slavery
  88. Singo and Howard Engage with Homosexuality
  89. Singo and Howard Demand Repeal of Libel and Slander Laws
  90. Singo and Howard on Consumer Protection
  91. Singo and Howard on Consistency
  92. Workers Party is born as foe of government
  93. Political branch formed
  94. Government seen by new party as evil
  95. Singo and Howard on Non-Interference
  96. Singo and Howard on Women's Lib
  97. Singo and Howard on Licences
  98. Singo and Howard on Gun Control
  99. Singo and Howard on Human Nature
  100. Singo and Howard on Voting
  101. Singo and Howard on
    Inherited Wealth
  102. Singo and Howard on Education
  103. Singo and Howard on Qualifications
  104. Ron Manners on the Workers Party
  105. Singo and Howard Hate Politicians
  106. Undeserved handouts make Australia the lucky country
  107. A happy story about Aborigines
  108. John Singleton on Political Advertising
  109. Richard Hall, Mike Stanton and Judith James on the Workers Party
  110. Singo Incites Civil Disobedience
  111. How John Singleton Would Make Tony Abbott Prime Minister
  112. The Discipline of Necessity
  113. John Singleton on the first election the Workers Party contested
  114. Libertarians: Radicals on the right
  115. The Bulletin on Maxwell Newton as Workers Party national spokesman on economics and politics
  116. Singo and Howard: Australia Should Pull Out of the Olympics
  117. Singo and Howard Like Foreign Investment
  118. Mark Tier corrects Nation Review on the Workers Party
  119. The impossible dream
  120. Why can't I get away with it?
  121. The bold and boring Lib/Lab shuffle
  122. Time for progress
  123. The loonie right implodes
  124. Max Newton: Maverick in Exile
  125. John Singleton on refusing to do business with criminals and economic illiterates
  126. Censorship should be banned
  127. "Listen, mate, a socialist is a bum"
  128. John Singleton on Advertising
  129. John Singleton on why he did the Hawke re-election campaign
  130. Sinclair Hill calls for dropping a neutron bomb on Canberra
  131. Bob Howard in Reason 1974-77
  132. John Singleton defends ockerism
  133. Singo and Howard talk Civil Disobedience
  134. The Census Con
  135. Singo and Howard Oppose Australian Participation in the Vietnam War
  136. Did John Singleton oppose the mining industry and privatising healthcare in 1990?
  137. Bob Carr in 1981 on John Singleton's political bent
  138. John Singleton-Ita Buttrose interview (1977)
  139. King Leonard of Hutt River Declares Defensive Just War Against Australia the Aggressor
  140. Singo says Lang Hancock violated Australia's 11th commandment: Thou Shalt Not Succeed
  141. Singleton: the White Knight of Ockerdom
  142. John Singleton bites into Sinclair Hill's beef
  143. Save Parramatta Road
  144. 1979 news item on new TV show John Singleton With a Lot of Help From His Friends
  145. Smoking, Health and Freedom
  146. Singo and Howard on Unions
  147. Singo and Howard Smash the State
  148. Singo and Howard on the big issue of Daylight Saving
  149. Come back Bob - It was all in fun!
  150. A few "chukkas" in the Senate for polo ace?
  151. Country Rejuvenation - Towards a Better Future
  152. Singo and Howard on Profits, Super Profits and Natural Disasters
  153. John Singleton's 1977 pitch that he be on a committee of one to run the Sydney 1988 Olympics for profit
  154. Thoughts on Land Ownership
  155. 1975 Max Newton-Ash Long interview on the Workers Party
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