Tony Zarb is up for the vote in the “Most Unpopular Man in Malta” polls. He seems to know it too, because the most recent press photographs show him looking white-faced and stricken, as well he might. For some reason best known to him, in the thick of the Sea Malta chaos, he chose to go off to Brussels on a jaunt to an executive committee meeting of the European Trade Union Council – as though the meeting could not take place without the union man from Malta.
Then, on Monday night while he was still away and presumably conducting his negotiations by telephone from his hotel room, our Tony decided to rescind the demands that had made Grimaldi back off from the purchase of the crippled national shipping line, whose debts outweigh its assets. Two hours after close of business in Malta, he faxed a letter through to the Investments Minister, who is known for his brusque line in sarcasm. “I was informed that Tony Zarb had not faxed this letter to me earlier in the day because he could not find a good enough fax machine in Brussels,” Minister Austin Gatt said.
The fax was another attempt at the brinksmanship which has made the General Workers’ Union so notoriously anachronistic. It fails to understand that jobs are created and lost through the relationship between demand and supply, and they are not in the power of any union to control. Though our Tony climbed down from his zero-sum-game demands, the letter he faxed through to Dr Gatt, presumably on the last good quality fax machine in Brussels, contained a death sentence – his own as well as Sea Malta’s. That death sentence was spelled out in the only demand to which he clung: that the General Workers’ Union should continue to be recognised at Sea Malta or whichever shipping phoenix might rise from Sea Malta’s ashes. Tony Zarb might not have realised that insisting on this was suicidal, and that he might as well have gone ahead and fallen on his sword (ah, but he’s not Japanese). He might be a little out of touch with reality, not yet having cottoned on to the fact that nowadays, when the secretary general of the GWU speaks, Malta does not tremble. Instead, Malta sighs in exasperation. The sight of Tony Zarb agitating on stage does not strike fear into the heart of the nation. It is more likely to provoke irritated laughter and several jokes. The cartoonist Maurice Tanti Burlo captured the general feeling towards Mr Zarb and his union with a series of cartoons that featured Queen Elizabeth II looking at the union leader depicted as a bothersome toddler, saying: “Not now, Tony.”
We are left wondering what passed through Mr Zarb’s mind when he insisted on maintaining GWU recognition after the sale of Sea Malta to Grimaldi. Why on earth should Grimaldi wish to buy Sea Malta with Tony Zarb on board? It doesn’t, of course, and you would feel the same way. He might wish to pass off this stunt as an attempt at ensuring the GWU continues to stay on and care for the interests of Sea Malta workers – but to lots of people sitting out here, it looks like precisely the opposite. It seems that Tony and the union are more interested in power-mongering on their own behalf, than in making sure that jobs are not lost because of their silly antics. The simple fact is that the power of the union is being eroded, and the union does not like it. As Investments Minister, Austin Gatt pointed out, in between remarks about Tony’s preferred choice of Brussels’ fax machine, it is the law that determines which union is recognised, and not Tony Zarb in a demanding fax from Brussels.
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The role of workers’ unions has changed over the years, but the dinosaurs which control the GWU, squashing all attempts at coups and change, have failed to move with the times. Over the past couple of decades, it has become an accepted fact of life in the developed, democratic world that jobs are created and destroyed by market forces alone, and though the state, its agents, and organisations like unions can facilitate or obstruct this process, they cannot actually participate in it. You cannot force a company to keep people it doesn’t need, and who it cannot afford to pay, on its payroll, just to “protect jobs”, because in the short or medium term that company will go bust anyway, putting everyone out of work, and not just the originally-redundant few.
The red agitators of the past are no longer what is needed in the 21st century. It is required of the union leaders of today that they understand the dynamics of business, and that they cooperate with employers to safeguard jobs by maintaining the company’s revenue and efficiency as far as possible. The idea of “them and us” – of employer against employee, belongs to the past. The picture of the employer as a capitalist pig, who is there to be milked and exploited, because he himself milks and exploits his workers for profits, is an outdated one. Without capitalism, there would be no jobs and no wealth. All you have to do is look at the places where there is no capitalism to see this, and to merely glance at the economic explosion that occurred in China when it was permitted just a little capitalism (God help us all when it gets to the stage of lots of capitalism). Capitalism is a good thing, not a bad one. The GWU’s outmoded attitude is particularly senseless when the “capitalist pig” in question is the government, through the agency of Sea Malta, whose limping performance is financed by the people’s taxes, rather than through any particularly business-like practices.
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They say there’s no money in the country and then 59 mid-range BMWs fly out of the door for Lm2 million in a matter of minutes. Plenty of people do have money; they just don’t want to spend it unless they feel they’ve got a good deal. Good deals are open to interpretation, of course. You might think it more sensible to spend Lm40,000 on a tiny flat that appreciates in value, rather than on a car that depreciates in spades. But all so-called good deals have one thing in common – the person paying out the money believes that he or she is getting more in return than he or she would have done in the normal course of events. Look at the behaviour of many women during sales when the price of their favourite clothing is chopped by 50 per cent. Ordinarily, they would never think of going out and spending Lm500 on those clothes at their full price, but then you see them spending this amount at once when the price is slashed by half. More to the point, they don’t see it as spending Lm500, but as saving Lm500. When they fail to spend Lm500 in the first case, it’s not because they don’t have the money but because they don’t think they’re getting enough in return for it at full price. On the other hand, they rather like the idea of getting Lm1,000 “worth” of clothes for Lm500. Even people who have plenty of money sloshing around think this way. That’s the explanation for why they will write a cheque for Lm12,000 for a luxury watch, but then dither about buying a luxury car for Lm30,000. The trouble is that, with the car, they know how much is going on tax, but with the watch, they don’t. So the mind works like this: actual car value = LmX; tax element = LmY, therefore car price = LmX+Y and Y is money down the drain. With the watch, all they can see is LmX; even though they must know that it is actually LmX + Y, they can’t quantify the Y element and so they blank it.
Just look at what happened when the registration tax on those 59 BMWs was waived. They sold like pastizzi before we heard about cholesterol. Now those people can afford to pay the registration tax – they’re just unwilling to do so. They would rather not buy a luxury car at all than hand over the tax. And that is why the Association of Car Importers is only partly right when it says that, if the government lowers the registration tax on cars from its present atrocious level of 75 per cent, people will buy more cars because they will be more affordable (and so get rid of their polluting old ones). It’s not just the affordability that will up car sales if the registration tax is chopped harshly – it’s also the pleasant feeling that your money is going on buying you a car, rather than on buying from the government the permission to own one. This is basic marketing psychology. When you know that you are paying Lm7,500 for a car worth Lm4,300, and that the other Lm3,200 is just pure tax, you are tempted not to buy the car at all, and make do with what you have – even if you can afford 10 new cars. Those who work hard for their money don’t spend it easily. The people you see splashing it all around are operating on the maxim of easy come, easy go, which is why it is almost always the shadiest people who don’t think twice before spending very large amounts on cars and jewellery.
People will not spend when they feel they are being cheated for money, even if they are floating on a sea of cash. This is a simple fact of life that other governments have understood, but clearly not ours – it is better to cream off a little money from each of many transactions, than to cream off a lot of money from each of a few transactions. You end up making more from the first course of action than from the second – and everybody is happy.