79-02-B3

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Australia II

Transcript On the last broadcast , I told of how the new prime minister of Australia, Malcom Fraser, and a labor/ managment group called "Enterprise Australia" turned Australia's economy around. They knocked an inflation rate down to 5 percent from 20, cut government costs and taxes, increased productivity and cut man-days lost in strikes to one-fourth of what it had been. One of the key tools was an idea brought to them by an American troubleshooter, John Q. Jennings of New York. It was the institution of annual reports by management to the workers with col or graphics and illustrations. Workers learned that they took home better than 90 percent of the company's earnings. Only four and a fraction percent went to stockholders, and 4.6 percent was reinvested in the company. On that last commentary, I asked if it would work here. I'm convinced it would, and I'm happy to say Dart Industries, working with the Graduate School of Business at the University of Southern California, is doing something of the kind. With all of our knowledge and all of the "jillion" words of information pumped at us each day, we still believe in a number of economic and political fairy tales. When opinion research asked a cross section of Americans how they thought corporate income was divided between employee payroll and profits, the answer was 25 percent to employees, 75 percent for profit. Students at Kings College near New York City thought the split was 60 - 40 in favor of profits. The facts were 90.6 percent went for employee compensation, and the rest went for profits -- which had to be divided between stockholders and reinvestment in plants and machinery. It's no wonder the kids made this kind of mistake -- 52 percent of their teachers said they believed the largest portion of national income went to owners. The fact is, after taxes, only three-a nd-a-half percent went to owners. Another poll found Americans in general believed that 10 percent net on sales after taxes would be a "fair" profit. They believed however, that manufacturers were getting 20 percent profit. So far "Enterprise Australia" hasn't aroused a lot of interest in either management or labor circles in America. That's too bad. The founder of the A.F.L., that great labor statesman, Samuel Gompers, would have understood "Enterprise Australia". He said management and labor were partners, and the worst sin management could commit against the worker, was to fail to make a profit. I would add another -- it is a sin against the worker, it is a sin against the citizen at large, and it is truly a sin against our sons and daughters not to do everything we can to dispel the economic mythology so prevalent in our land. I hope enlightened employers will create an "Enterprise America". This is Ronald Reagan. Thanks for listening.		Details Batch Number 79-02-B3 Production Date 01/19/1979 Book/Page RPtV-412 Audio Youtube? No
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