Enaj,

So if you cut taxes then people will spend more and the economy will be better off.

Your analysis is superficial. If wages really did fall then either shareholders would get richer (and spend more) or the price of goods would get cheaper.

No doubt there will be winners and losers. I suspect that the winners will be employees who work smart and have a good attitude. I suspect the losers will be employees who slack off and have a bad attitude.

However I don't think the reforms represent a zero sum game. I think there will be far more winners than losers.

Regards,
Terje

Terje'
I am with you. Increase taxes and people will be better off. Let's not be superficial.
Any system that has built into it that there should be losers is a terrible system.
Losers in a system increase costs in the economy. They lose their job, go and get drunk, bash the wife and get high blood pressure and have heart attacks and die.
And all that increases cost on the economy and the Health system that has just been saved by firing the poor bloke. The IR system must have been invented by a politician who can't think beyond his desk.
With this IR system we are going like "The Apprentice" TV series.
'You're Fired' The winner gets a million dollars and the loser gets nothing. So he jumps off a cliff. Who cares? Not the politicians.

Terje,
With GlenWriter, I reckon any system that accepts losers with a callous I'm alright Jack, shrug of the shoulders is pretty superficial. We are all winners and losers, none of us are exclusively one or the other and we forget this at our peril.
Decreasing taxes is fine, spreading fear amongst consumers about the security of their (or their kids) jobs is not and will effect the economy. Its called "consumer confidence" and I believe even the hardest nosed economic rationalists take it into account.
Politicians often seem to forget that the economy is not made up of employees, employers, consumers, parents and voters, nicely and neatly seperated from one another. They are all the same people, affect one part of their life and you affect them all.

Terje

Your analysis fails to take into account input costs other than wages. Let's postulate this case: wages fall, fuel rises dramatically. The additional cost of transport, power and a host of other input costs directly or indirectly influenced by the fuel price means
(1) the price of goods stays the same, or rises;

(2) shareholders feel no benefit from the fall in wage inputs, and don't spend more;

(3) workers have no chance of becoming shareholders, as their income has decreased and their expenditure remained constant, or, given the additional cost in travelling to work, actually risen, thus precluding discretionary purchases like equities.

No amount of "working smart" will make any difference to that, will it? And what does "working smart" actually mean, by the way?

Please good people don't try to tell Terje anything, he is the possessor of all knowledge, or thinks he is. Also by his reference above to "bad attitude" he actually means a worker with the audacity to speak up for him/her self. Terje, is a control freak, hell bent on keeping the "little man" down, re other posts in other places. These arogant human beings don't tend to recognise that the rest of us know at least as much as he thinks he knows, if not more, they are a dangerous breed that believe that "they are the pinnicle" and we merely the floor sweepers. Everyone has the right to have children, children are our future, our society must make sure we can afford to reproduce, Terje apparently believes we can import alliens to buy the wares of small business, as only the well healed should be able to reproduce, is it me is there a striking similarity to this attitude, and that of our old mate, Adolf Hitler.....

Shonga,

Do you know about "Godwin's Law". Let me provide a reference:-

http://en.wikipedia.org/wiki/Godwin's_law

For the record I have no inclination towards genocide or racial bigotry. It was before my time, however both my parents lived in countries that were invaded and occupied by the Nazis. Some of my relatives died in concentration camps because they joined the resistance movement.

When I read your characterisation of me as being like Hitler I felt inclined towards saying "go to hell". However on reflection I think I will just forgive you and move on. Your personal attack is obviously just part of a dysfunctional habit. You may not be aware that attacking people on a personal level is a pretty ineffective way to engage either their mind or their heart. I won't demand an apology however I would like one.

http://www.amazon.com/gp/product/0671723650/qid=1134123779/sr=8-1/ref=pd_bbs_1/102-2409905-3238551?n=507846&s=books&v=glance

Enaj,

It seems to me that the main people spreading fear with regards to IR reform are in the union movement. I agree that this is unfortunate, however we live in a democracy and over the long haul "free speech" is far more important than "consumer confidence".

Dire predictions of economic recession as a result of the current IR legislation is pure hyperbole.

Regards,
Terje.