LATIN EUROPE HANGS ITSELF
THE UNION SCOURGE.
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Latin Europe Pays the Price
Workers throughout the three European countries presently seized with serious economic spasms are not only overprotected but are now facing the years of lax attitudes to work that have dug deep into their economic platforms. Where the upper economies of Europe have long kept the unions and their ideological hatred of employers at bay, these, have fostered ever increasing disdain for those who sought high standards and commitment in the workplace.
The problem has been aggravated by political pandering to a work force constantly demanding more pay, more holidays and shorter work hours. The ambitious and often wasteful social exercises fraught with loose ideological schemes like the Ministry of Equality in Spain, have resulted in the sort of heavy expenditure that only vast borrowing could provide. Additionally it would seem, creating the wrong type of unproductive employment at the expense of the drained small and medium sized companies forced to close through lack of ready cash to meet eventualities. Fostering lean, productive and export compensating economy has never been much of an ideal in countries where unions are only too eager to blackmail employers into any sort of popular measure designed to please their followers. Foreign investments in employment has also gone against the grain and at the slightest opportunity often become targets of employee and union aggression.
Within the last ten years, salaries on all three countries have risen directly and indirectly in a mad rush to equal the European average despite the fact that it did not carry either heavier levels of productivity or even the sort of respect for working standards that would have rallied industrialists to create bases there. In fact, all attempts by Northern European investors to create such industrial links have met with less than eager support from the local political representatives and financial institutions. A classical statement that met an approach was “How much money have you got ?” Much of that money has gone out from many a pocket just with the initial setting up costs and backhanders, not to mention the list of technical requirements with the eagerly awaiting “professionals” ready to draw up ridiculous plans for electricians, plumbers, builders and sound proofers, just to get an opening licence. The same goes for electricity and water supply. Most locals ignore the rules and gradually weave their way through contacts to get what they want at a third of the cost. Needless to say each intervening agents in the process of allowing someone to set up a good idea, talk in telephone figures with hand outstretched for heavy advances. Many have lost fortunes in decorations and fittings to end up with no licence or even basics like electricty and water. Local landlords often let out unlicenced premises at brick stage hoping that the tenants will spend the thousands required to turn it into a sophisticated unit. They usually end up by taking it back willingly after the tenant has gone to the wall.
The major problems in Spain for example stem from the aggressive unionists and the radically nationalistic, civil servants within the Ministries of Employment and Social Security who have and still treat the small and medium sized businesses with an incredible disdain. Help lines are non existant and questions on the telephone are cut short with demands to turn up and take a place in hour long queues only to be told to fill in forms and attach the enormous amount of documents required to set the processes in motion. These steps can take up to a year and force a hapless tenenat to pay incredible rentals and overheads without as much as a guarantee that the licence will come at the end. One interviewed, unhappy hotelier whose rates had been doubled over a period of two years, made the mistake of expressing his concern about the effect of rising costs on an angry business community. The reaction from a well clad lady attending him at the municipal offices, was dramatic as she waved her fingers at him menacingly, telling him to leave or she would call the police for “threatening” the staff. This attitude is underlined in wall sign directives which tell the office workers to smile at people. This demoralizing behaviour of municipal bureaucrats, in particular, creates a “them” and an outside world situaton which is feeding a resentment reflected in the hatred born of exasperation. It is not uncommon to find people outside these offices and courts of justice, brandishing their fists and telling those round them what needs to be done with that rabble inside. Hardly the recipe for a constructive, motivated business community. In fact, the tendency is for avoidance of investment in employment and finding returns in hassle free, bricks and mortar and further feeding into the property bubble.
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Stillborn Industries.
For the recently established self employed, the fears are expressed in mountains of legal statutes and penalties that turn the business of employment into a nightmare. Every single new law governing quality of environment, health and prevention of accidents, data protecion etc etc. creates a massive civil service department that attempts to feed itself from their newly found oportunities. Rampant penalties follow, with the onus on the employer to study the complicated ramifications of these needs and their forced reliance on the usual back room agencies set up to cover the concern – at a price. Instead of a gradual, free line of support from occasional inspection/tuition process, designed to engage employer understanding and support, inspections usual arise from malicious denouncements from competitors or ex employees and these result in automatic horrendous fines which are either paid or deducted from the bank accounts to which all Ministries and law courts have direct access. Curiously, most businesses managed by locals never come close to these assaults and it is clearly seen, in the restaurant and building trade particularly, the flouting of all these so called punishable requirements. It is difficult therefore to get away from the distinct impression that these tactics are of a racist nature and that workers are encouraged to drive disliked employers to the labour courts. A close look at a complete series of bureaucratic attacks of this nature on one single company, shows what seems to be a general coordinated attempt to close it down. Despite opinions to the contrary, all departments of State, discuss individual cases between each other and there is a free flow of the most intimate information with the use of the Identity Card number. Bank accounts, assets, purchasing habits, travel patterns etc.all come under scrutiny on one screen by any civil servant out to do harm. It is this that has caused a number of MEPs from different countries to question the nature of the so called “democracies” behind the scenes.
What it all means, is that despite the heroic efforts of many trying to keep their teams together, one false slip and one undermining worker can reduce the whole thing to a house of cards. In all three countries there is no genuine understanding on the part of the fiscal and union authorities of the creation of wealth and employment. The difficulties which employers have to establish a market and workable base in the early stages is of no consideration and the outlandish, insensitive interference from the cash struck local and national authorities in pursuit of fines and indirect taxes, is prevalent. Queries and concern expressed by members of the business community are not only disregarded but despite the ability to identify themselves, they are told to join the queues at their centres miles away if they want answers. Insistence results in disquieting rudeness and indirect threats.
Banking Irrelevance.
But given the union elements, the bureacratic interference and the constant new legislation demands, the total lack of banking support seals the fate of many from the start. The so called lines of credit which require personal assets and a history of tax contribution are not easily available. Bank managers work on specific documentation like tax and vat returns and are incapable as a whole, to make pesonal assessments of the validity and future prospects of the valuable businesses which are often unable to even pay their electricity bills. It is therefore not a question of a lack of entrepreneurial talent, but the empty space that surrounds it with the exposure to a non work culture that would rather be at home. It is difficult to combat its serious deleterious effects on the overall effort and short term contracts are a form of protection against the fear of the contracting of workers who start to defy management and upset clients. In fact, most small and medium sized businesses fail to reach maturity for the same reasons – lack of short term liquidity and untrainable staff. In the main the image of the idle chatting and family linked telephone stuck employees is pretty much the order of the day in the Meditteranean work culture.
This petty interference by ministerial inspectors eager to be seen to be catching employers out and the worker courts that rule in the main in favour of disruptive workers have already created an aversion response that translates in favour of staying small and taking only friends and family on board. Many have seen their life savings surrendered to unjustified huge penalties and the statutury extended employment after dismissal (and even at the end of contracts) by the legal forces. Where income does not even serve to cover basic overheads, these telephone figures can only produce one thing – bankruptcy or black market loans. It is not uncommon to see workers manipulated by trigger