The abuse of governmental authority in the marketplace is inappropriate, eroding the market's vigor, decreasing efficiency and diminishing market freedom. It is something from which those in power must refrain.
The result of President Chen Shui-bian
The powers that be, in order to get a bigger slice of the social-welfare pie, have obstructed the economy's pie-making process. Not only has this given rise to a glut in the labor market, but it could result in setbacks to the country's commodity and capital markets as well.
The negative effect which occurs when government authority is abused flippantly and arrogantly -- and during times of over-confidence about the positive influence of government authority -- can trigger disintegration and incapacitation on a grand economic and social scale. It is a risk of which the nation's leaders should be wary.
Due to a way of thinking formed from past resistance movements and other social movements, the Chen government has upheld the ideology of labor as the eternally disadvantaged class, constantly in need of guarantees. After formally assuming the reins of power, the Chen government has tended to execute policy on this basis with increasing frequency.
The totem of "industrial democracy," in particular, has become a key position from which the new regime actively intervenes in labor-management relations. But neither the impact on financial markets nor the lackluster investor interest -- possibly brought on by this "industrial democracy" system -- seem to be attracting the attention of the government.
When the on-going confidence crisis in commodities markets (related to the financial markets, the reservoir and the Fourth Nuclear Plant) is over, industrial democracy will still affect the labor market, which could, in turn, worsen instability in financial and commodities markets. This should not be taken lightly.
History reminds us that while the "industrial democracy" system was the darling of Northern and Western European countries before the1980s, by 1985 the whole international situation had changed drastically.
After 1985, all European countries (excluding West Germany), had completely discarded the industrial democracy system, adopting "Management by Participation" (MBP) as the best way to promote labor rights and interests.
Despite clinging to industrial democracy the longest, on July 14, Germany's pro-labor Chancellor Gerhard Schroeder made an aggressive push for a new "off-welfare" national policy, in the form of the historic tax-reform act. The measure clearly strengthened corporate autonomy, promoting the people's willingness to invest, and spurring economic development.
The most important impact of the industrial democracy system on a country's industrial economy, is the increased power and status of labor within the corporate entity, which allows workers to apply pressure directly to corporate governance. Direct intervention of government authority expands the rights of workers and gives non-investors a chance to enjoy a slice of corporate governance, fundamentally altering the company's proprietary structure.
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