[sustran] Private Monopoly and Vested Political Interests in SA

[Wendell Cox]

Eric... Thank you for the note.... some comments....>
>
>Wendell, thanks for the information. It would not surprise me
>if companies found ways to hide their subsidies.  Are these
>commuter oriented only services for highly specific markets
>or are they in competition with combi-taxis in many places?
>
It is my understanding that there is some competition, but the problem for
the fixed route operators --- bus and rail --- is the flexibliity of the
kombi services, which can provide more flexible services. Their higher
market share has been taken over the years directly from the buses and
commuter rail operations.

>We have had the debate before about "market wages." This is
>about ideology. Yes, we could take advantage of the large
>numbers of people earning very low wages by busting unions,
>but there really is no such thing as a pure "market". Without
>unions, managements hold more of the negotiating power instead,
>as can be seen by declining real wages for the majority of
>workers in the United States as unions have disapeared. Thus,
>I have to support the right of people to collectively bargain.
>A senior driver earns about $16 per hour at most agencies. This
>is barely even a middle class income anymore. What I want to 
>know is why a rich country can no longer supposedly afford to
>pay decent wages for work that is important to society?
>
We'll probably never agree on most of this --- 

I have no problem with collective bargaining so long as there is voluntary
unionism (such as in New Zealand and, if we are to believe the Liberal
promises, in Australia before too long). The critical point, however, is
that employees are free to collectively bargain throughout the private
sector --- and many competitively tendered services are provided by drivers
represented by unions.

However, government provides easier prey for collective bargaining than
companies in the market, which is how we get above market wages, benefits
and working conditions. It's a simple economic question --- shall we get the
most transit service possible for the money available --- or shall we be
content to allow a good bit of the money --- I estimate 75 percent of the
new money (inflation adjusted increase) --- to go to cost increases that
could not occur in the market --- a good bit of that to labor. Is subsidized
public transport a primarily mobility service, or is it a welfare service
that provides employees with a higher standard of living than they could
obtain in other employment. You cant have both --- and we dont. As you know,
urban transportation is very competitive --- the auto is a strong competitor
--- if public transport is to make any serious headway, then it must devote
all of its resources to the task, and cannot be diverted by subsidiary
goals. Of course, it has been diverted in the US, and we are paying the price.

And.... why do we owe a greater obligation to transit workers than to
Walmart clerks or MacDonalds employees? If some are to be paid above market,
then why not all. What avout equal protection under the law (I ask this
seriousiy).

Anyway, I am confident that I have been no more successful in changing your
view than you have been in changing mine --- but the exchange is useful.

Best regards,
Wendell Cox


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