Past performance is the best predictor of future performance, so the business chiefs heading to Anthony Albanese’s Productivity Summit should know they are about to be carved up and handed to the union movement.

Just as the Jobs and Skills Summit was a front for legislating industrial relations back to the 19th Century, the Productivity Summit will be a front for cementing those norms in place even more.

To ensure that, the word salad chefs in the Prime Minister’s kitchen are cooking up ways to redefine productivity so it looks like, even tastes like, productivity to the ordinary voter, but has no nourishment at all.

You might think that productivity means doing more with the same, or fewer, resources, but then what would you know? You probably think being a woman isn’t an option for those of us with XY chromosomes, but Labor governments everywhere will tell you that you are wrong.

So, if you can’t fathom the intersectionality of biology and ideology, you are obviously not bright enough to fathom the intersectionality of ideology and economics.

This is a government that knows how to talk the talk and redefine the walk so you never have to take a step. When confronted with the need to build more houses they sorted it – 1.2 million more over fixed years. Fixed, done and dusted. How do I know? I’ve seen the media release and they’ve told me about it ad nauseam. The fact we will not get even close to meeting that target is neither here nor there.

Once the government has spoken things can be assumed to have happened. Look at their energy transition and its mirage of dramatically cheaper prices and expanded jobs and economic output.

Expect the semantic strategies to be applied to the Productivity Summit. And indeed, expect the energy transition, an area where we are doing less with more, to be a key plank in the productivity manifesto, as it already is.

In December 2024, the Treasurer commissioned the Productivity Commission to produce five reports on how we can increase our productivity, with one of those reports to investigate: ‘Investing in cheaper, cleaner energy and the Net Zero transformation.’ The title assumes the conclusion and the fix is already in.

One of the strange things about this summit is that the Productivity Commission was supposed to provide interim reports about now, and while the Productivity Summit is supposed to complement the PC’s work, it feels to me like it is really an attempt to gazump it.

The Productivity Commission used to be a bastion of commonsense. It’s the successor of the Tariff Board, which in the 60s under ‘Alf’ Rattigan started nudging the country towards openness, transparency, and competition. In 1974 it was transformed into the Industry Assistance Commission before merging with some other bodies to become the Productivity Commission.

But lately, it’s had some interesting notions.

For example, it promotes the idea that childcare is a productivity measure because it gets more women back into the workforce faster. This seems to me to confuse increased output caused by a larger workforce with increased output caused by a more efficient workforce.

You might also ask how productive it is when the government has to subsidise childcare because it is so expensive it doesn’t make economic sense for a woman to work full- or part-time, only to hand all of her post-tax income across to a childcare provider.

In economic terms we measure productivity in dollars of output per hour of work. For people who think in terms of widgets, it might be counter-intuitive but increasing the price of widgets faster than the cost of production, actually creates an increase in productivity under this definition, even though no more widgets per person are produced.

While a factory might be able to count widgets, the Australian Bureau of Statistics can’t, so the only way they can feasibly measure productivity is by looking at inputs in terms of time and outputs in terms of price and volume.

If a woman (or a man) can raise their child for the same price (measured by the opportunity cost of what paying work they could be doing) a childcare centre can, and the evidence is that on average they do it much better than the centre, where is the productivity gain?

You lose not only in terms of the family, but the quality of life of the children, who are the next generation.

But the Productivity Commission’s view on childcare pleases the woman who’s been told she can have it all, and found that you can’t, or not for the price you thought you could. And it pleases the government who thinks their proxies are better stewards of your children than you are. I bet your family never does a Welcome to Country in the mornings, or celebrates Pride Week/Month, but your local childcare centre or creche and kindergarten most certainly will.

The government is probably even more cynical. If they increase the price of childcare faster than inflation, then they’ve conjured a productivity gain into existence, even though they (or you as a taxpayer I should probably say) are picking up the tab.

What does the union movement want out of this summit? Productivity destruction mischaracterised as productivity growth. Here’s a couple from yesterday’s Financial Review.

They want to regulate AI under a ‘digital just transition’ so that if it does produce efficiencies, they capture the productivity gains through higher wages and/or severance and retraining packages. If these guys were running things we’d still be using quill pens and ink instead of tapping away on laptops.

Workers in the ‘care’ economy, the ones who influenced the government to legislate minimum carer/patient ratios making it much harder to improve productivity, are more semantically adventurous. They want a fundamental rethink of how productivity is measured. It needs to take into account quality of care. Yes, well, see above. Give higher quality of care and people will pay more and your productivity will have improved.

The aim of the unions is a centrally mandated wage rise, and yet more government interference in the economy. But government is a dead weight on the economy with its productivity being parasitic on everyone else’s productivity, and highly productive countries also naturally produce high wages. The solution decreases productivity addressing an imaginary need.

The mechanism for increasing wages is simple, unless you want to make money organising labour and intimidating businesses. A rich economy produces rich people who buy and do things, this produces employment and as unemployment decreases, labour shortages increase and workers demand higher wages. Because the businesses are making a lot of money they can afford to pay the wage increases. In fact, the best most successful businesses will compete for the best employees. If you doubt me, check out the average earnings of a Google employee ($189,684 p.a.).

Unions don’t need to worry about AI skimming-off their wages. Their basic concern should be that the government will help them to divert so much money that their employer will not be able to invest in their business enough to become the next Google or Meta.

But we do need to worry. In a world suddenly grown very dangerous, our only comparative advantage is the strength of our economy. Can it survive the depredations and word games of the industrial relations warlords running Australia?