The Canadian Imagination

What it means to be Canadian; examining and reworking Canada as a nation.

Tuesday, June 23, 2009

Life without alcohol

So possibly there will be a strike by Ontario's Liquor Control Board employees, to start June 23 at midnight. It does not affect beer, sold through The Beer Store, or local wines, sold through the vintner with outlets at several grocery stores and malls. Even so, the population of Ontario has been thrown into a panic lest the next weekend or two leave them without the mindbender of choice.

(Toronto currently has a city workers strike, most visible through the garbage piling up at the curbs during the current heat wave. It is not generating anywhere near the same level of outrage ... yet.)

Those working in the catering and service industries have the hardest time of it. Their events have been booked. Certain types of liquor have been booked, and are expected. To these people, the strike comes not only as an inconvenience, but as a threat to their businesses.

The strength of just-in-time supply structures lies entirely in the reduction of the inventories required. What is less often mentioned -- or dismissed as irrelevant -- is the linked assumption that all parts of that supply chain, from production to transportation to installation, become utterly dependent upon each other. If even the smallest cog in that chain stops, the whole thing comes to an abrupt stop. Production ends. Often workers are laid off as a result.

Yet the net effect, no matter what, is lower operating costs. If the system works perfectly, it is as a result of lower stock inventories. If it glitches, the operating costs are still lower, because they are downloaded onto laid-off labour (and consequently uploaded onto government unemployment structures). On the other hand, if we make this into a grid which also takes efficiency into account, the whole thing starts to look more like the choices of a Prisoner's Dilemma.

(In a Prisoner's Dilemma grid, the optimal choice is almost never taken because in each case, the relative best choice is not objectively optimal. It is argued by Robert Axelrod that over the long term, cooperation is a necessary outcome among perfectly selfish players seeking the best outcome for themselves. You can decide for yourself how well this theory has worked, and just how much relative power levels have to do with it.)

We have seen the weaknesses of just-in-time business structures before, especially when the Big Three of the auto industry started to show cracks. How efficient can a structure possibly be where everything comes to a complete stop every time one of its many, many cogs is delayed -- by anything?

Yet in all this structure, it has become popular to praise upper management for all successes and blame only labour for all failures. In the auto industry, labour does bear a significant portion of the blame -- what other industry has wages as inflated for equivalent work? -- but to extrapolate the same assumption to all corporate difficulties is far too simplistic.

Which brings me to the casually vicious comment of a businessman, one of many on-the-street commentators dug up by the local television stations, who was able to reduce the entire dispute simply to the cost of labour as borne by his own taxes, obviously the less, the better: and never mind if an increasingly part-time, no benefit policy happens to be making it impossible for many liquor store employees to make a living wage. No doubt he also firmly believes both they, and he, are being paid what they are worth ... which evokes the image of a world where some types of bottom-rung workers are not believed to provide value enough to pay for their own continued existence.

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