(OPE-L) Globalisation: A Perspective for Labour

From: Rakesh Bhandari (rakeshb@STANFORD.EDU)
Date: Sun Nov 09 2003 - 12:56:18 EST

EPW Book Review
October 25, 2003

Globalisation: A Perspective for Labour

Globalisation and Labour: The New 'Great Transformation' by Ronaldo
Munck; Madhyam Books (by arrangement with Zed Books), 2003; pp
xiii+216, Rs 250.
Rohini Hensman

The subtitle of this book refers to Karl Polanyi's The Great
Transformation, published in 1957, in which he argues that the
so-called 'self-regulating market' would have destroyed human society
and its natural surroundings if not for a counter-movement of social
regulation to protect human beings and nature. At the forefront of
this movement, he said, are those who are most adversely affected by
the market - namely, the working classes - using trade unions,
protective legislation and other instruments of intervention which
remove labour, which is not just a commodity like any other, from the
orbit of the market. For Polanyi, "Socialism is, essentially, the
tendency inherent in an industrial civilisation to transcend the
self-regulating market by consciously subordinating it to a
democratic society".

The Industrial Revolution was 'the great transformation'; the 'new
great transformation' is globalisation. Throughout most of the 20th
century, argues Munck, "nations competed with nations and their
workers were foot soldiers in that war" (p 3), but now, "while
corporations have headquarters in particular nation states, they are
effectively disembedded from these societies by their economic logic"
(p 4). Russia, the eastern bloc, India and China have entered the
domain of marketised economies. This process of globalisation is
based on the proliferation of wage labourers: the global proletariat
doubled between 1975 and 1995 to reach 2.5 billion workers, with the
bulk of this growth in the third world; in 1995 the World Bank
projected that fully 99 per cent of the workers who would join the
labour force in the next three decades would be from the low- and
middle-income countries. The female workforce also grew rapidly: by
the mid-1980s, more than half the world's working-age women were in
paid employment. While labour markets are not yet truly global,
labour has become a global resource; corporations go anywhere in the
world to seek labour and import highly skilled labour from anywhere,
workers are driven to seek work everywhere.

The book outlines the transition from the 'Golden Age' of capitalist
stability after second world war to the crisis in the latter part of
the century. The Bretton Woods Agreement of 1944 linked the dollar to
gold, the IMF was set up and established parities between major
currencies, US MNCs expanded phenomenally in the 1950s and 1960s, and
were joined thereafter by European and Japanese MNCs. The right of
workers to organised representation was recognised by capital and
regulated by the state, not only nationally but also internationally
through the ILO, set up in 1919, which likewise "reflected the
principle of tripartite representation, with representatives from
government, employers and trade unions sitting down together"(p 29).
In the advanced capitalist countries, employment grew by 30 per cent
between 1950 and 1970, trade union membership increased from 49
million in 1952 to 62 million in 1970. The rise of 'classical
Fordism' linked mass production, mass consumption and the welfare
state, with the National Health Service in Britain perhaps providing
the most radical innovation. The technological revolution resulted in
a huge growth in productivity.

According to the ILO, the period from 1950 to the 1970s or 1980s was
also a 'Golden Age' for third world countries like Brazil, Argentina,
Mexico and India, where industrial production for the domestic market
had taken off during the depression and after. (This development is
ignored by the New International Division of Labour theorists like
Frobel, Heinrichs and Kreye, who argue that the colonial division of
labour broke down only when manufacturing for the world market was
shifted to third world countries in the 1960s.) Anti-colonial
struggles superseded colonialism. Meanwhile, industrialisation and
expansion of employment was also taking place in the Soviet Union and
eastern bloc countries, with fairly extensive social rights for
workers, although in other ways the human cost was huge.

However, this whole edifice was in crisis by the end of the 1960s and
early 1970, when profit rates in the advanced capitalist countries
fell by one-third. Full convertibility of the dollar to gold was
unilaterally abandoned by the US in 1971, stagnation led to the
abandonment of the central planning model in the eastern bloc as well
as some third world countries, while restrictive monetary policies
and a huge rise in interest rates resulted in the third world debt
crisis. There was an anti-union employers' offensive in the US from
the 1970s onwards. By the 1990s, the primarily national capitalism of
the 'Golden Era' had ended. In this post-Fordist era,
'flexibilisation of labour' became the watchword for capital. While
flexibility as such can take forms in which labour gains, employers
interpreted it to mean deregulation and informalisation of labour.
Also called 'Brazilianisation', because it meant the spread of
conditions already prevailing in the third world to advanced
capitalist countries, it resulted in insecurity and loss of welfare
benefits in the latter. It has also been called 'feminisation', but
this thesis conflates the introduction of more women into the labour
force - in the EU, for example, 20 million out of 29 million new
workers joining the labour force between 1960 and 1990 were women -
with the unregulated, insecure employment conditions under which most
women are employed, but which are not peculiar to female labour; it
also ignores the fact that women's jobs too have been informalised.

This new era is seen by globalists as a movement towards a borderless
world in which TNCs rule supreme. The same view, but in a nightmare
version, is presented by the 'anti-globalisation gurus' (p 53); for
them, "at times it seems that globalisation acts as a surrogate for
neo-liberalism, which would make more sense as a political target" (p
54). Some, like Hirst and Thompson, argue that the globalisation of
production has been much exaggerated - a view that has some truth,
but ignores the qualitative changes that have taken place. For Munck,
"globalisation is an ongoing process, and..to seek to 'halt' it is
simply misguided and a strategic cul-de-sac" (p 20), and "I believe
labour and other social movements should be neither for nor against
globalisation but, rather, see the issue as one of understanding the
complexity of globalisation as a process of social transformation" (p
6). This understanding is necessary in order to make use of the new
openings created by globalisation, as transformative social movements
such as the women's liberation, human rights and environmental
movements have done. In such cases, the concept of global citizenship
has been associated with processes of empowerment and
democratisation. However, it would require a truly internationalist
labour movement to make use of these openings, and the author traces
what could be the emergence of such a movement.

At its inception in the second half of the 19th century, which was
also a period of globalisation, the labour movement was almost
instinctively internationalist. Its scope was limited to western
Europe, North America and Australasia, with humanitarian concern
rather than a specifically labour or socialist perspective for the
inhabitants of the colonies, but it did oppose war. The foundation of
the First International in 1864 was a landmark, with Marx personally
responsible for much of its internationalist ethos. At this point, it
was employers who countered workers' internationalism with aggressive
nationalism. But in the latter half of the 19th century, labour
movements began entering into closer relationships with nation
states, and in the 20th century drifted into a more 'nation-statist'
perspective. Despite the formation of the Second International in
1889, the formation of the main International Trade Secretariats
(ITSs) in the 1890s, and the international struggle for the
eight-hour working day, the nationalist trend continued, and was
confirmed in 1914, when the Second International disintegrated as its
national components supported their national bourgeoisies. The Third
International, formed in 1919, was strongly internationalist, but
after Lenin's death in 1924, Stalin began to run it as an instrument
of the foreign affairs policy of the USSR.Then Mao initiated a shift
in the meaning of internationalism with his proclamation that "in
wars of national liberation, patriotism is applied internationalism",
and the colonial question joined the labour question at the core of
the socialist project for liberation.

In 1945, the World Federation of Trade Unions (WFTU) with 65 million
members created a fragile unity between communist and non-communist
unions, but in 1949 the International Confederation of Free Trade
Unions (ICFTU) split off under the leadership of the US AFL-CIO, and
the WFTU became explicitly pro-Soviet. There followed a period of
'trade union imperialism', as first British unions helped the
colonial state to vet unions in the colonies, and then US unions
colluded with the CIA to impose dictatorships in the third world, all
in the name of fighting the 'communist threat'.

Fighting to re-establish internationalism in the trade union movement
has not been easy. Charles Levinson, head of the International
Confederation of Chemical and General Workers' Unions in the 1970s,
argued for international union action as a countervailing power to
the MNCs, and there was limited success for the strategy of
international union coordination. But this approach was criticised
from two angles. Some (e g, Olle and Schoeller) argued for a more
political unionism which would take up the issue of third world
development, while others (e g, Haworth and Ramsey) called for a more
'social movement' unionism, taking up extra-factory issues. These
criticisms pre-figured directions in which the trade union movement
would move, with unions like the Danish SID taking up development
issues on one side, and the development of 'social unionism' in
countries like Brazil, cutting across occupational lines and taking
up issues like health care, running water and housing. Examples of
the transition from the old to the new forms of international
solidarity are the campaign of solidarity for Black workers in South
Africa against the apartheid regime and all-white trade unions, which
were expelled from the International Metalworkers' Federation, and
the campaign of solidarity for Coca Cola workers in Guatemala against
Coca Cola and the brutal dictatorship in that country. There has been
a shake-out in the AFL-CIO Foreign Affairs Department and critique of
'trade union imperialism' which has also changed the outlook of the

The author feels that while the 'social clause' debate has been the
most divisive issue facing the trade union movement, it is also "the
strategy best placed to unify the world's workers" (p.128) and thus
the most important political issue for the TU movement. Why? Because
"For the new accumulation regime which emerged in the 1990s, based on
accelerated internationalisation, there would still be a need for a
global regulatory orderŠ It is this search for global regulation
which forms a key horizon for international labour" (p 50). He points
out that recognition of the link between international trade and core
labour standards predates the ILO and is embodied in the ILO
Constitution (1919), that the Havana Charter of the International
Trade Organisation (1948) has social and labour clauses, while its
successor, GATT, also contains labour standards clauses with
provision for sanctions, so this is not something new. While agreeing
with Vandana Shiva that the social clause wouldn't tackle the
processes which create world poverty, he adds that rejecting it for
this reason would be like arguing that trade unions shouldn't demand
higher wages, because that doesn't attack the roots of wage
oppression! He also points out the inconsistency of those who oppose
global free trade, and at the same time oppose the social clause as
protectionist, i e, an obstacle to free trade! On the other hand, he
takes the AFL-CIO to task for its opposition to China's entry into
the WTO, which he characterises as protectionist and racist, and
agrees with Amartya Sen that global solidarity needs to be based on
equality between north and south as well as global rights for
workers, transcending national legal recognition. He points out that
"some of the debates on the social clause hinge on tactical
disagreements", such as the requirement that the ILO should be the
body responsible for monitoring workers' rights, and concludes,
"However, none of these debates seems to affect the principle of
valid core labour standards. In that sense I think we can usefully
start with Julio Godio's statement that, 'if the struggle to
transform the world is international, the fight for a social clause
can mobilise workers on a global scale to regulate the market',
renewing thus, this time at an international level, the historic
confrontation between capital and labour" (pp 166-67).

If one were to sum up the argument of this book, it would be:
globalisation need not be detrimental to labour, so long as
international regulation and social policies counteract the
destructiveness of the market economy. "There is no better example to
demonstrate this than a comparison of Chile under Pinochet and
democratic Chile in the 1990s" (p 110), which has been pro-labour
without opting out of the global economy. Some governments and TNCs
recognise the need for this regulation, and even international
organisations like the World Bank "have increasingly engaged with
global social movements and shown a certain permeability" (p 179).
This is not out of altruism, but because the more far-sighted
representatives of capital realise that deregulation can undermine
international trade and the growth of the international economy by
leading to a contraction of demand (a fact which has not yet dawned
on Indian employers and their BJP-led government). MERCOSUR (Common
Market of the Southern Cone) in Latin America demonstrates one way -
i e, regional trade blocs - in which third world countries can tackle
globalisation; trade unions have an active role in it, showing that
local and global trade union activity are neither mutually exclusive
nor in a hierarchy of importance, but have a dialectical relationship.

Munck castigates the "backward-looking nature and..almost reactionary
nationalist and statist outlook" of the mainstream Left, which wishes
to go back to "standard nation-state-era politics" (p 19), but also
questions the "globalisation from below" strategy because it
"neglects the north/south dimension" (p 173), advocating instead a
strategy at all levels, from local to global, and in all spheres
(production, consumption, community, etc). Information technology,
inextricably linked with globalisation, allows this articulation of
levels to be achieved in a less hierarchical, more democratic manner.
At the national level, he sees a key issue for labour renewal as
being working class unity across gender, racial, ethnic, religious,
age and skill (and in India, we might add, caste) divides. At the
international level, as the International Federation of Chemical,
Mining and General Workers' Unions (ICEM) argued in 1996,
international trade union action should not be seen as a last resort
when all else has failed, but should be planned on an international
basis from the start.

I have summarised this book at considerable length because I feel it
offers an excellent perspective for labour activists across the
world, including India. As the September 2003 WTO meeting at Cancun
demonstrates, simply rejecting the WTO is a suicidal strategy for
third world countries. The chances that a poor country like Ghana
(where tomato farmers are being bankrupted due to imports of tinned
tomatoes from Italy produced with huge state subsidies) could do
anything to improve the situation through bilateral negotiations are
just about zero; if they use protectionism to shut out imports, they
would also find their exports blocked - whereas the G21 group of
developing countries has much more bargaining power in negotiations
for the removal of agricultural subsidies in Europe and North
America. The same is true of negotiations over the production of
cheap life-saving drugs. In other words, in solidarity lies strength,
as the trade union movement has always known, and if they get their
act together, developing countries have incomparably more power in
WTO negotiations than they could ever have in bilateral negotiations
with advanced capitalist nations. The challenge is to regulate the
new global regime in the interests of labour, and the author offers
various suggestions as to how this can be done.

The book does have flaws. For example, one senses a lack of
experience on the ground which leads to overly glowing accounts of
the achievements of consumer campaigns and organisations like SEWA.
While the former have indeed succeeded in forcing companies to adopt
Codes of Conduct supporting labour rights in their supplier
factories, and implementing these in a few cases, there remain
hundreds of thousands of other supplier factories and sweatshops
where the problem of making these standards effective simply has not
been resolved. And while the latter has done an admirable job
organising women workers in the informal sector, their wages remain
at the abysmal levels which characterise this sector. Better editing
would have eliminated some unnecessary repetition. But these are
minor defects compared to the overall strengths of the book. A must
for anyone interested in these issues, and fortunately Madhyam Books
has made it available at a reasonable price.

© Copyright 2001 The Economic and Political Weekly. All rights reserved.

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