Newsletter No. 25
AUGUST / SEPTEMBER 2004

Europe’s labour movement at a watershed When IG Metall — Germany’s manufacturing workers union and arguably Europe’s strongest — lost a 2003 campaign to extend the 35 hour week to east German manufacturing workers, European employers saw it as a signal to launch a broad offensive against labour. The German government and employers called for a cut in public holidays, a rise in retirement age to 67 years, an ‘overhaul’ of the welfare state and extension of the work week to 45 hours (‘Seismic shifts spook German workers’ Australian Financial Review 31.10.03). Similar demands emanated from employer interests across Europe To regain the initiative, IGM staged a series of rolling strikes for its 2004 wage campaign, a much diminished demand for a 4 per cent wage rise, compared with its previous 7 per cent in 2002. But in a situation of low inflation, high unemployment and most devastatingly, alternate supplies of labour in eastern Europe and Asia, IGM’s campaign crashed. It finally accepted, for significant numbers of members, longer hours for wage rises, and in some cases without pay rises — just to secure existing jobs. IGM came to see it the employers’ way — only improved competitiveness would keep jobs (‘Return of the 40-hour week’ http://www.dw-world.de/ 8.3.04). The manufacturers breakthrough inspired German state premiers to immediately declare they’d increase working hours for civil servants (including teachers and hospital workers) to 40 and in some cases 42 hours a week by the end of year, with no pay increases, to ‘set an example for private industry’ (‘Unions threaten strike to prevent longer hours, same pay’ DW 29.3.04) . In France, where, since 2000, a 35-hour week is supposedly being phased in across the workforce, a similar counter-offensive is in play. The centre-right Raffarin government blamed poor economic performance on a shorter workweek and eased legal annual overtime limits from 130 to 180 hours. A right dominated parliamentary inquiry into the effects of a 35-hour week called for its scrapping. Unfortunately for the government, the report’s release coincided with its mauling at regional elections, so it had to deny any further designs to overturn the 35-hour law (‘French right demands end to a universal 35-hour week’ The Independent 16.4.04). It didn’t have to — German multinationals in France were already spearheading an attack on union strongholds in manufacturing, creating a chance for the government to start to manoeuvre to abolish the hated 35-hour law. First, German firm Bosch threatened to move its Lyons plant to Eastern Europe if workers didn’t work longer hours for the same pay. Other major employers are queuing to strike similar deals (‘Longer workweek debate hits France’ http://www.dw-world.de/ 28.7.04 Now, as French firms outsource furiously to low cost countries, PM Raffarin ‘vows to fight the jobs drain’ — by ‘letting’ workers work longer than 35 hours and giving new tax breaks to the corporate sector! Only British workers seem to be making any advances at present, though from a long way behind. A vulnerable UK Labour government seeking re-election must make concessions to a resurgent trade union militancy, as well as get UK workers’ conditions up to general EU standards. Unions recently won an extra 8 days paid holidays a year, improved rights for casual employees & a tightening of provisions for a 48-hour average week limit, in line with EU directives (‘Millions of workers to be given eight more days holidays’ A Grice 26.7.04). An expanded European Union lets German and other European employers take advantage of a pool of cheap labour with fewer rights, to exploit and to incite competition between east and west European workers. From the Mediterranean to the Baltic employers & subservient governments call for a 40-hour week to ‘again become the standard’. Claims the chair of Sweden’s employers’ federation, ABB: ‘In the new European Convention countries, one often works 45-50 hours a week. There work is a luxury, here (in Sweden) it is a right” (‘To work more, gain less: a heavy tendency in Europe’ Liberation 27.8.04). The destructured Comecon bloc countries are adopting extreme liberal economic models, to lure foreign capital with the prospect of higher than average profits. Europe’s trade unions find it hard to build solidarity and help raise labour standards in the east, when they are under so much pressure in the west. The ‘overwhelming view of economists and financial & business communities’ is that the pace of economic reform and ‘freeing’ up of the labour market need accelerating. Yet, ‘leaders of the major European economies are being confronted by serious resistance to any actions that threaten existing welfare and social support structures’ (that is, the ‘non-wage’ components of the social wage) (‘Citizens’ revolt keeps Europe’s hands tied’ AFR 31.3.04). In Germany up to 100,000 demonstrate weekly against the neo-liberal policies of Social Democratic-Green state and federal coalition governments (‘Monday demos triple in size’ GLW 25.8.04 also www.wahlalternative-ASG.de ). Such protests may shake governments, but by themselves are of limited impact. The corporate drive to create and restructure the global economy is relentless, incessant, insidious and not too concerned with using up governments to achieve its objectives, which are driven by the deepest economic need to reproduce and expand capital. Capital is being exported by investment in, or relocation of plant to lower cost labour markets, then re-exporting the products, or by capitals consolidating into fewer and larger global firms (as illustrated by the auto-making industry). Union organisation, or even improved productivity, has not so far prevented enterprises relocating or capital flowing towards low-pay countries, to leave behind unemployment and unused skills. ‘Capital emigration lies beyond the sphere of influence of the unions’. This shift, conveniently, undermines centralised collective bargaining and resolution of ‘the problems lurking in free labour markets’. A ‘highly individualistic, decentralised US agreement model’ is replacing consensus based collective bargaining that, with associated welfare services & labour rights, is the historical achievement of Europe’s labour movement (‘Centralised collective bargaining model alive & well in Finland’ http://www.artto.kaapeli.fi/ unions/T2003/g29 1.12.03). The ‘American’ model generates chronic overwork because job insecurity is so pervasive. The absence of a decent social net for retirement, health and education and the absence of strong unions and laws to protect workers forces them to maximise present earnings through overwork and competition with one another. Europeans have gained socially and politically what US workers say they want individually, but have not been able to achieve politically (‘Should Europe work more or U.S. less?’ http://www.iht.com 11.8.04) The neo-liberals call for the overthrow of Europe’s social-democratic gains precisely because they retard exploitation. Their measures are an already proven tragic farce for labour: ‘flexibility ... has been an instrument for widening the gulf between rich & poor, providing the better off with a source of cheap and insecure labour’ OECD research shows (‘Flexibility can tie you up in knots’ The Guardian, 22.3.04). The drive for increased competitiveness will see social aspects of Europe’s growth strategy sacrificed because ‘the temptation to deregulate labour markets and place less emphasis on sustain-able development will be too great to resist’ says the head of the European TUC (‘EU going backwards on economic goals’ http://www.euobserver.com/ ?.3.04). The process happening in the EU reflects and affirms Lenin’s 1916 analysis of imperialism and the export of capital: ‘As long as capitalism remains what it is, surplus capital will be utilised not (to raise) the standard of living of the masses in a given country, for this would mean a decline in profits for the capitalists, but (to increase) profits by exporting capital abroad to the backward countries (where) profits are usually high for capital is scarce .. wages are low, raw materials are cheap. The export of capital (needs) a number of backward countries … already drawn into world capitalist intercourse (and) elementary conditions for industrial development (to) have been created. The need to export capital arises from the fact that in a few countries capitalism has become “overripe” & capital cannot find a field for “profitable” investment.’ Imperialism, the Highest Stage of Capitalism V I Lenin, 1916. The uneven, one-sided nature of capitalism’s growth serves its immediate advantage — it creates and exploits differentials in costs of labour across the global labour market, increases competition among workers and undermines those whose conditions are best. It creates a ‘race to the bottom’ for labour, but for capital, lifts its bottom line for rates of profit, at both ends of the labour market. The labour movement must organise internationally, to prevent loss of historical gains, where it has been best organised and politically and industrially powerful; and to give support and improve conditions for labour in those zones and industries to which investment is now moving. The Union Network International, largely an IT workers union, is already ‘committed to developing its global organising work, with particular emphasis on multinationals; and trying to build unions in new markets where offshoring is occurring’. It aims to secure global framework agreements between UNI, multinationals and national unions to guarantee rights and conditions (see http://www.union-network.org/ ). UNI’s example points to how the world’s working class can shift power into its own hands; and by building a more cooperative and equal global society, guarantee peace and sustainability. Intrinsic to this are global work hour standards — to share work more equally across the world’s workforce, thus ensure a corresponding access to resources that satisfy human needs; and to ensure that an ongoing enhancement of our productivity leads to more free time (social capital) and an ability to build sustainable and sustaining communities.

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