By Doug Nesbitt
During the infamous inflation crisis of the 1970s, Pierre Trudeau’s Liberals imposed strict wage controls on workers in late 1975. The federal government created a handpicked corporate-aligned “Anti-Inflation Board” to impose below-inflation wage caps on collective agreements across the private and public sectors.
Unions organized a million-strong one-day general strike in October 1976 but never defeated the 3-year law. Wage controls never proved effective in fighting inflation, but they did succeed in cutting the working-class share of the pie. This was the beginning of 40+ years of real wage stagnation which continues today.
After ridiculing controls a year earlier in his 1974 election run, Pierre Trudeau’s Liberals justified wage controls by introducing price controls, too. But unlike dictatorial wage controls, business enjoyed an easily-avoidable voluntary regime of price controls. From small business to big corporations, profits predictably triumphed over sacrifice.
Trudeau would continue his attack on workers across various fronts, notably his cuts to Unemployment Insurance benefits, strikebreaking “back to work” laws, and harsh wage controls on federal public workers in 1982-84.
Another great effect of Trudeau’s Wage of Price Controls was its signal to the business classes that an offensive against labour had a new level of support in the Liberal government.