Socialist Worker

Does globalisation weaken workers?

Issue No. 2002

It's good that the trade union leaders have said they won’t let the closure of Peugeot’s Ryton plant go through without a fight. Last week the Peugeot bosses admitted they could build a new model in Ryton profitably – though not as profitably as in a new plant they are building in Slovakia.

The T&G and Amicus unions are balloting their members at Ryton for industrial action, but their real plan is for a national consumer boycott of Peugeot brands by trade unionists.

“There are six to seven million trade unionists in this country,” says Tony Woodley of the T&G union. “Globalisation means companies are free to decide where they want to make their products – but we are free not to buy them.”

Underlying this strategy is a lack of faith in strikes as an effective form of action. As Derek Simpson, general secretary of Amicus, puts it, “Traditional industrial action does not apply in a global market. What point is there going on strike if the company is going to close the plant?”

Simpson is expressing the common sense view of globalisation as creating a world of footloose transnational corporations – if workers utter a whimper, the management up stumps and move elsewhere. But this is a huge oversimplification.

For one thing, one of the genuine forms of the globalisation is the development of transnational production networks connecting plants in different countries that cooperate in making a final product.

This change actually makes companies more vulnerable to industrial action – because disruption at one point in the production chain can have ripple effects across a continent or two. This is particularly true when firms rely on “just in time” methods that involve keeping stocks low to save on costs. This means that a strike in a components supplier can have a very big effect.

Bargaining power

In any case, it’s not true that shutting down a plant is a costless decision for a transnational corporation. Doing so may mean having to write off expensive equipment. Plants have to be located close to big markets and where there are good supplies of skilled workers. This gives these workers significant bargaining power.

Nevertheless, of course, plants are shut down. The car industry is suffering from a huge crisis of overcapacity worldwide. The “Big Three” US auto companies – General Motors, Ford and Daimler Chrysler – are under tremendous pressure, especially from their Japanese rivals. This helps to explain why General Motors’ Vauxhall plant at Ellesmere Port is facing big job cuts.

Simpson is right to say that when workers are confronted with closure, their options are limited. The revolutionary left has always argued that workers should occupy factories threatened with closure. Occupations prevent management from selling off valuable machinery and can be used to put pressure on the government to take the factory over. Consumer boycotts have usually proved a futile alternative form of action.

But it’s worth asking how workers get to the point where they are faced with closure. Car workers in Britain and the US have suffered from 25 years of management blackmail. Bosses have demanded speed ups and job cuts, threatening closure or drastic redundancies if the workers refuse. Union leaders have repeatedly caved in.

So when a plant is faced with closure, the demoralised and shrunken workforce may be bitter and angry – as the Vauxhall and Peugeot workers clearly are. But their confidence in their ability to fight has been worn down by this death by a thousand cuts.

Union leaders such as Woodley and Simpson, who have presided over the contraction of the car industry, bear a huge responsibility for this state of affairs. Last week they were at it again, offering the Peugeot and Vauxhall managements talks over ways of increasing productivity, including job cuts.

Globalisation doesn’t mean that resistance is futile. In all sorts of ways it can make workers stronger. The trade union leaders who use globalisation as an alibi for their failure to do their job and defend the livelihoods of their members are a much bigger problem.


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Alex Callinicos
Tue 23 May 2006, 17:51 BST
Issue No. 2002
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