Labor in the Era of Capitalist Globalization

June 18, 2005

[From teleconference on labor unity June 9, 2005]

Up until the early 1990’s the Socialist camp including the Soviet Union acted somewhat as a brake on imperialism and on capitalist globalization. In addition to checking military domination and adventures, as trading partners the socialist block also provided the means for many developing countries to resist and/or minimize unfair trade and the penetration of foreign capital.

The collapse of socialism in Russia and Eastern European countries released a tremendous capital scramble and global competition for markets. Under a banner of capitalist triumph, deregulation, privatization and unfair, predatory trade agreements swept much of the planet.

To be sure, the technological and communication revolutions that feed and accelerate globalization were already well developed by the 1990’s. Capitalist globalization with its free flow of capital around the world began much earlier, but it took on new aggressiveness and clearly accelerated with the collapse of the Socialist block. And without the socialist system acting as a brake, US capital became the undisputed top dog – protected and developed by the world’s single remaining military super power.

Lenin made it clear in his Imperialism: the Highest Stage of Capitalism, that imperialism is not a policy. It is a stage of capitalist development, an objective process. The same is true of capitalist globalization. It is not a policy of this or that government. It is an objective process of transnational capitalist development. This distinction is important to understanding the class struggle today. While government policy can have impact on how capitalist globalization proceeds, as long as capitalism is the dominant economic system, its globalization will continue.

The process of capitalist globalization is important context for understanding the labor movement in the US today. How did we get here? Why such a decline in union membership in the last 35 years? Why such a steep decline in industrial union membership with plant closings etc? Why have so-called free trade agreements like NAFTA become such a big deal for labor? What is behind all these sharp debates within the labor movement?

The election of Ronald Reagan in 1980 signaled a sharpening corporate and government attack on labor. It is no coincidence that the early 1980’s also marked the acceleration of plant closings and downsizing in the manufacturing sector and greater investment by US based transnational corporations overseas. This period also featured increased outsourcing of jobs and work overseas.

During the 80’s and 90’s accelerated mergers and created vast new manufacturing and financial empires. Take, for example, the steel industry. Up until the 1980’s steel was, in most countries, a nationally owned industry, whether private or public, with very little penetration of foreign capital. Today, the worlds top three steel companies are based in India, Luxemburg and Japan. Each has vast holdings around the world, including some in the US. US Steel also now owns plants in other countries, including in some formerly socialist countries in Eastern Europe.

The growth and concentration of transnational capital has fueled far right political trends in many of the industrialized countries, including the US.

In the early years the strongest trend in the US labor movement was to channel anti-capitalist globalization sentiment into right-wing and jingoistic directions. Some fell for arguments that pitted US workers against workers in other countries and against immigrant workers. Japan bashing and Buy America campaigns mobilized xenophobic attitudes. Global capitalist competitiveness was packaged as worker-against-worker competition requiring wage and benefit sacrifices to beat the competition.

The early 80’s saw big losses for workers in the form of concessions in wages and benefits. It also was a time when unions lost ground in coordinated bargaining with common contract expiration dates, and when unions lost industry wide master agreements that had set higher standards for many manufacturing sectors of the economy.

At the same time, left-center coalitions and rank-and-file movements in labor challenged these setbacks and put forward class struggle alternatives that rejected concessions and give backs. They stressed global labor solidarity and targeted the transnational corporations. By the late 1980’s, many of the leaders of the rank and file movements of the 70’s and early 80’s were moving into leadership positions in local, state and national unions. This process culminated in 1995 with the election of the Sweeney, Chavez-Thompson, Trumka slate to the leadership of the AFL-CIO.

Still, the objective process of capitalist globalization continued to develop. With the establishment of the World Trade Organization and the NAFTA agreement, fresh waves US based capital flowed off shore, resulting in still more job loss and the destruction of whole working class communities in some manufacturing regions.

The process of capitalist globalization continues during both Democratic and Republican administrations. What is different is the amount of room labor and the people have to fight to limit the impact of globalization on their members and working families. For example under Democratic administrations in several states unions were able to get legislation passed to require advanced notification of plant closings. In some cases corporations were forced to repay tax breaks and abatements to communities. Living wage ordinances were passed in some places in direct response to the downward spiral of wages and working conditions due to plant closings and outsourcing.

Under Democratic administrations with a Democratic controlled Congress, labor was able to lead successful fights to extend unemployment benefits and for trade adjustment legislation to provide limited help to those who lost their jobs due to capital flight and trade-related plant closings.

Under Republican administrations and with Republican control of Congress has come sharply more aggressive attacks on workers and any measures that would serve to lessen the blows of globalization. Because the Republican right is much more ideologically driven in their anti-labor and pro capitalist globalization fervor, they have greatly accelerated the process of unfair trade treaties and attacks on labor rights.

These differences in how the two Big Business parties handle trade issues was clearly visible in the 2004 elections. Bush and the Republicans downplayed trade issues and basically called for maintaining fast track authority for trade agreements. They voiced support for FTAA, CAFTA and other free trade agreements and opposed any idea of reopening trade agreements to include labor rights and environmental standards. They attacked the Democrats for being in the pocket of Big Labor, and threatened new legislation to curb labor rights and collective bargaining.

On the other hand, on the Democratic side, several candidates in the primaries called for either ending NAFTA or reopening existing treaties to incorporate strong labor rights and environmental standards with enforcement teeth. Richard Gephardt campaigned on the idea of establishing an international minimum wage. And in the end John Kerry bowed to his labor support and called for reopening NAFTA and negotiating strong labor rights and environmental standards into all future trade agreements, a fundamental shift from his pro-globalization stance in the Senate. Kerry and many other of the Democratic candidates were also sponsors of the Employee Free Choice Act, labor’s bill to restore the right to organize.

Labor, War and Peace

War and militarization are integral parts of capitalist globalization. For example, the presence of US military force and large military investments in Colombia is not separate from the drive for the Free Trade Agreement of the Americas (FTAA). And, of course, the invasion of Iraq and Afghanistan and the thrust of military might into the Mid East serve the interests of US based transnational capital – oil in the first place. This reckless use of military power is not wasted on US trading partners and on those who fight against capitalist globalization around the world.

Larger and larger sections of labor are beginning to see the connections between war and capitalist globalization – making the world safe for global investment and exploitation. Others in labor are going a step further and demanding that labor adopt an independent foreign policy based on the interests of the working class, not based on the corporate agenda of the US government.

In the end, capitalist globalization, backed up by a single military super power makes the world a very dangerous place. One big conclusion drawn from this situation has to be that labor and the peace and solidarity movements are the most natural of allies. Making this connection and working to build ties with the peace movement has to be one our most important tasks.

Global Solidarity

Today there is growing recognition that global capital demands a labor response that is global. In the Communist Manifesto, Marx and Engels point out, Now and then the workers are victorious, but only for a time. The real fruit of their battles lie not in the immediate result, but in the ever expanding union of the workers. This union is helped on by the improved means of communication that are created by Modern Industry, and that place the workers of different localities in contact with one another. It was just this contact that was needed to centralize the numerous local struggles, all of the same character, into one national struggle between classes.

Today we must update the last sentence to say, It is just this contact that is needed to centralize the numerous national struggles, all of the same character, into one international struggle between classes.

The slogan Workers of the World Unite is back by popular demand! This is a worldwide development. In both developing and industrial countries, the labor movements are increasingly aware of the global nature of the capitalist enemy.

It is far from clear what form global labor solidarity will ultimately take, but it is clear that all manner of international ties are bring built every day.

One problems is that there are still two world labor federations, the ICFTU and the WFTU. And both are still somewhat mired in their cold war pasts. Nevertheless, both are playing an important roles in fighting globalization.

However, increasingly it is the specific global union federations, what used to be called trade secretariats, that are the center of building day-to-day working ties for global labor. These global union federations are built on specific industries such as garment and textile or metal working.

In the past, these forms were mostly for sharing information and national experiences in fighting and organizing workers in specific industries. Today, unions go beyond sharing information to coordinated action including around strike struggles. And much of the new global solidarity takes place outside of the two world federations and their global union federations.

Increasingly, US unions are signing specific solidarity agreements and alliances directly with unions in other countries that bargain with the same transnational corporations. For example, the United Steelworkers Union has such agreements across the globe including in Mexico and Brazil. The USW pioneered this approach when it took the initiative to call together many of the specific unions dealing with Bridgestone/Firestone around the world. Now there are regular global conferences of these rubber unions to map out specific bargaining strategy and solidarity.

Road Blocks to Global Labor Unity

Global capitalism is built on an ugly history of racism and national chauvinism. From slavery through colonialism and neo-colonialism, through world wars brought on by imperialism and fascism, capitalism has grown into a global system based on oppression, super-exploitation and bloody conquest. The transnational corporations of today, like all their predecessors, use every tool at their disposal to divide labor and the people.

Apologists for capitalist globalization claim that they are bringing jobs and economic development when they chase low wages throughout the developing world. This was part of their argument for NAFTA. Instead NAFTA has driven down overall wages in Mexico and destroyed many rural based economies and agricultures, driving millions off their land. This is a pattern repeated by all the so-called free trade agreements.

Perhaps one of the biggest products of capitalist globalization is migration. By 2002 there were over 175 million people crossing borders leaving their own countries in search of work. Much of this migration is the result of corporate plunder of developing countries. Large percentages of the victims are racially and nationally oppressed peoples. Whole far-rightwing, even fascistic movements have been built on racism towards immigrants in industrial countries including the US. Just now we see the rise of the Ku Klux Klan styled Minuteman organization in the Southwest.

While it is global capital that benefits from racism and national chauvinism, unfortunately these ills too often find reflection in the working class movements and in labor. This even finds its reflection in the divisions in the world trade union movement: much of the WFTU’s member unions are based in developing countries of Africa, Asia and South America while the ICFTU is more based in the European, US and other industrial countries.

While great strides have been made in the US labor movement including a complete change in policy towards immigrant workers, recent bouts of China bashing have commingled political anti-communism with racism in targeting Chinese workers and their working class government.

Again, it is important to note the growing movements for world labor unity. When the AFL-CIO and several industrial unions reached out to unions in Mexico, it went a long way in reversing racism reflected in our labor movement. The same can be said for efforts in the Caribbean and other parts of South and Central America. US trade union involvement in the anti-apartheid movements in the 70’s and 80’s also contributed to a better global outlook for US labor.

Millions of women workers around the world suffer some of the worst evils of capitalist globalization. The race to the bottom finds them in the worst global sweatshop hell-holes. Transnational corporations make billions off the exploitation of women. Only full representation of women at all levels of the labor movement and commitment to organize industries and sectors of the world economy where women are concentrated can begin to bring equality.

Another horrific feature of capitalist globalization is the rise of child labor. Where the working class fought and abolished child labor in major industrial countries over a century ago – now capitalist globalization has reestablished it as a substantial profit making practice in the world. World labor is increasingly putting the fight against child labor at the forefront of its global agenda.

Labor Today

So, with all this background and general information, where does that leave US labor today in a globalized world?

First we have to realize that the attacks on labor here in the US are not unique. Capitalist globalization has rained down rightwing attacks and setbacks on labor many places around the globe. These attacks have ranged from changing labor law against the rights of labor, to the use of police force and repression against labor.

Just a quick example – In Australia a new sweeping labor law is being proposed by the conservative government that will allow companies to fire workers at will, force workers to sign individual labor contracts, reduce minimum wages and limit the rights of workers to get information and assistance from their unions. This sound remarkably like George Bush’s planned legislation for federal public workers.

Indeed, much is made about the decline of union membership in the US. This decline is also true in most of the industrial countries and in much of the developing world. In truth all the factors from plant closings, to union busting, to unfair labor law and limits on the right to organize that have reduced union membership here at home have been factors around the world.

Capitalist globalization has to be met with international labor solidarity. The process of building global labor solidarity is an objective process of the class struggle, just as capitalist globalization is an objective process. While it is too early to picture exactly the new forms global solidarity will take – global unions or global trade federations with international contracts, for example, one clear responsibility for progressive forces in labor is to make the connections and push for greater and greater international ties and contact with workers of the world.

This fight has many fronts. In the first place US labor has to be won to a bigger vision of its place and role in global labor. Leo Gerard, president of the United Steelworkers union said a profound thing in this regard at the steelworkers convention last month. We cannot survive as an island of prosperity in a sea of misery. That applies on many levels. It applies to all the unorganized workers in this country and to all those in deep poverty. It applies to workers and the poor around the world who are victims of global capitalism and imperialist war. Our vision has to be bigger, we have to see ourselves as a component of global labor that will rise only as workers and their families rise everywhere in the world.

Armed with a bigger vision of ourselves as part of the globalization of workers solidarity in the world, we should be that much more confident to take on the big fights we must here at home. In just the past few weeks we have seen the pension and contract crisis at United Airlines. Talk about a global industry! How will there be a global fight in the airline industry for jobs and retirement security? Or what about GM’s decision to cut 25,000 more jobs in the US. GM is a global corporation in a fiercely exploitive global industry. Autoworkers can’t win without a global solution and global solidarity.

As we fight to prevent Bush’s privatization of Social Security and the great pension rip-off, we have to be totally aware that pensions and social security systems are being threatened around the world – for example in Germany and France. As we fight for a national health care solution we have to be aware and in solidarity with the many countries, including Canada and Britain where national health care is under attack. As we fight to pass the Employee Free Choice Act we have to be aware that union organizers are being killed in Colombia and other parts of the world.

Further, we have to focus on critical struggles that help all workers and unionists in our country understand the global solidarity essential to curbing the transnationals.

One such project is the fight against WalMart. WalMart is a global behemoth that straddles the world killing jobs and communities everywhere it touches. The battle against WalMart is a fight that opens the door to understanding global capital and our common struggles for global solidarity.

One last note on the internal struggle in the AFL-CIO and the threat of a split. Things don’t look too good at this point but we have to remember that the process of developing greater unity and solidarity is also an objective process of the class struggle. Much of the internalized bitterness and flailing about is based on a very limited view of what globalization is doing to labor both here and abroad. It is not understanding that the fundamental cause of the crisis facing the union movement is not some terrible failure of labor, but due to the pressures of capitalist globalization.

To quote a trite clich, labor’s salvation is not in rearranging the deck chairs on a sinking ship, but in navigating the storm. It is in linking up with the global working class fleet. Our strength is not just in numbers, though that is extremely important, but it is also in our unity and solidarity with workers and the oppressed of the world.

Lastly a few questions to think about and discuss as part of our pre-convention discussion:

If there is a split in the AFL-CIO how will our clubs and districts help begin the fight to reunify labor and link it to global solidarity? This is most definitely not just a question for our trade union comrades.

How can the party as a whole help build the campaign against WalMart? What is our special contribution to this fight? How can our clubs, districts and trade union comrades further labor unity and solidarity with the WalMart campaign?

What more can we do in our clubs and districts and with our trade union comrades to link the demand to bring the troops home from Iraq and Afghanistan with local and national trade union struggles?


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