Backward mentality should not be allowed to check development

The British economy has been buoyant over the last 12 years, with rising living standards, low inflation and unemployment, and a strong currency. London has become the world’s top trading center and the successful Chancellor of the Exchequer Gordon Brown is certain to head the government soon. Not since the 18th century has the country seen such uninterrupted growth. Of course, this growth has been based on a successful blend of economic policies which, using privatizations and the positive business climate as tools, has brought large foreign investments to Britain and the relocation of all shipping and big multinational HQs there. Yet many analysts reckon that had Margaret Thatcher not neutralized the veto powers of the public sector’s big unions, Britain would have never moved onto the growth highway. This may be somewhat exaggerated, but it is true that when public sector unions stubbornly rejected any changes to their work status and prevented the modernization of state companies, banks etc, the results were negative, as the entire economy came to a standstill. The example of this backward attitude is impressive in the case of Greece. Indeed, throughout the last 30 years, the fighting spirit and resistance of unions has been evident in most of the broad public sector. Through industrial action, the «top-floor» unions, as Andreas Papandreou, PASOK’s founder and first premier, used to call them, secured high salaries, privileged pensions and more which might have been justified had they been funded by greater productivity and increased profits at state companies. This didn’t occur, so the top floor’s high salaries came at the expense of the lower ones, i.e. those of the workers in factories and smaller companies, the living standards of whom are steadily at poverty level. Worse still, not only has the competitiveness of state companies not increased but also, as the liberalization of the telecoms market showed, as soon as OTE was exposed to competition, it started losing market share rapidly (it has already lost 25 percent). If it had not imposed obstacles to broadband networks, its market share would have shrunk even more. The same will happen sooner or later with the Public Power Corporation (PPC) whose strength lies only in its free coal fuel. Consequently the top-floor privileges are anachronistic, reflecting an era when OTE and PPC were monopolies, so the government could easily form salary and pension systems unheard of in the market. Now the market is liberalized, however, and competition in telecoms and electricity is increasingly fierce, if the unions do not show flexibility or cooperate with management to modernize production and operation, lower costs and provide better services to the public, past privileges will be swept away by developments like lonely trees in the wind. For instance, the OTE unions insist on jobs for life for newly hired employees without thinking of the future; should OTE continue with the same labor status, it will not be able to guarantee current workers’ salaries, let alone hire new employees. In unhindered competition, the companies to survive will be those with flexibility on all expenses, including labor costs. In today’s bleak political landscape, created by government mistakes, delays and the entangled interests’ rabid attacks, some unionists are encouraged to remain intransigent. They should consider what kind of salaries and pensions will be dispersed in the future by OTE, PPC and Emporiki Bank should their market shares shrink any further. Interestingly, the PPC partial privatization conducted by the PASOK government raised 1.22 billion euros, while taxpayers’ contributions to the PPC staff fund were about 1.4 billion euros and those to the OTE staff fund 1.2 billion euros. This is the lower floors funding those at the top.

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