By Michael Bachelard
One of the world's pre-eminent labour market economists has described WorkChoices as unfair, destructive of productivity gains, unlikely to reduce unemployment and the product of "late 1980s thinking".
Harvard economics chairman Richard Freeman said he found it hard to believe that the Howard Government had introduced such a retrograde law in good economic times without any political consensus.
"It's an amazing law, something that I think the US Government would never in a million years try - the micromanagement, the detailed regulatory provisions - it just pours out, 700 pages of things stipulating how you can behave," Professor Freeman said.
"All economists would say that the law shouldn't intervene greatly. This law intervenes greatly . . . That's not the way you get things working right."
But Workplace Relations Minister Joe Hockey countered: "Many Australian economists would disagree strongly with Mr Freeman's assertions.
"We are focused on outcomes and the outcomes achieved over the last 10 years most certainly contradict Mr Freeman's assertions."
The Australian Chamber of Commerce and Industry's latest survey of 1331 businesses found that 71 per cent of them believed that WorkChoices had increased productivity, efficiency and the capacity to create jobs, with 68 per cent concerned at the prospect of the law being wound back.
But Professor Freeman, who is also the director of the Labour Studies Program at the National Bureau of Economic Research, said WorkChoices was outmoded in the view that dismantling structures to protect workers was the way to improve the economy.
This view of unfettered markets as solving all problems was the result of post-communist "triumphalism" and had been abandoned even by its main supporters, he said.
Increased workplace flexibility had paid some dividends for Australia, but, he said: "It's a bit like saying 'I give you a certain dose of medicine and it makes you better, now I'm going to fill you to the gills with medicine'. It's going to kill you!"
Reducing workers' rights would force down wage rates, increasing dependence on welfare, which would then also be cut. "Then you get a genuinely divided society," he said.
Creating jobs in a modern economy was not done by lowering wages for vulnerable people. "You need to improve the quality of skills, ability of firms, and workers who are key assets, to work together to make better products."
Professor Freeman will address a CEDA luncheon in Melbourne today.