Introduction to Workers, Unions, and Global Capitalism: Lessons from India

 

The politics of globalisation

Globalisation has had a profound impact on labour worldwide. But what, exactly, has this impact been? Enthusiastic proponents of globalisation in its heretofore dominant form argue that it levels the playing field between developed and developing countries, creating employment in the latter and enabling them to pull themselves out of poverty (cf T.Friedman 2005). Diametrically opposed to them are the passionate proponents of de-globalisation, who see globalisation as synonymous with inequality and oppression, and advocate disabling the World Trade Organisation (WTO), International Monetary Fund (IMF), World Bank and transnational corporations (cf. Bello 2000).

The economic crisis, which started in the US in September 2008 and swept through the world, left the first camp in disarray. With financial institutions collapsing, millions of jobs being lost, GDP shrinking and world trade contracting (Wade 2009), even Thomas Friedman (2009) had to admit that the market was ‘hitting the wall’. The opposite camp, predictably, was triumphant: ‘The current global downturn, the worst since the Great Depression 70 years ago, pounded the last nail into the coffin of globalization,’ proclaimed Walden Bello (2009).

However, there is a third position, which represents the majority of workers throughout the world. They have been fighting a losing battle for jobs, better employment conditions and social security for over three decades, a struggle that has become more desperate since the downturn. While it is clear that the model of globalisation pursued so far has been a disaster for them, de-globalisation would mean a further loss of jobs for workers in exporting countries, and raise both costs of production for companies using their products and the cost of living for consumers. Dissatisfied with both these positions, international unions have advocated building workers’ rights into the new global order (cf. ICFTU 1999), but this has yet to emerge as a concrete alternative.

This book argues that it is not globalisation as such but the dominant neoliberal model of it, alongside traditional authoritarian labour relations, that have exerted downward pressure on labour standards.  It attempts to put flesh on the bones of the third alternative by looking at workers’ responses to globalisation: responses which indicate that labour is ‘a social force which is central to the development of the international political economy and international relations’ (Harrod and O’Brien 2002a: 8).

Fine-Tuning the Linkage Proposal: Commentary

A cross-country comparison which finds ‘Strong evidence that countries with open trade policies have superior labor rights and health conditions and less child labor’ (Flanagan 2004: 26) suggests that openness to the world economy does not undermine workers’ rights and may even enhance them. However, the finding that in any particular country openness to the world economy can go with high labour standards is not incompatible with the proposition that globalisation as a process undermines labour rights globally.

One process by which this could and does take place is by the transfer of production from countries with higher labour standards to countries with lower standards, leaving workers in the former unemployed. Thus in developed countries, jobs in the labour-intensive textile and garment industries have been decimated as production shifted to developing country export sectors (Williams 2004; Narendranath 2004). This has also caused job losses in developing countries, when production moved from higher-wage countries like Korea to lower-wage ones like Cambodia. Outsourcing in the service sector led to further transfer of employment from developed to developing countries, leading to calls for a curb on outsourcing in the US (Alden 2004).

A less obvious, more insidious way in which labour standards are undermined is by the spread of low labour standards to countries which did not formerly suffer from them, or at least not to the same extent. The global expansion of informal labour – workers who do not have any formal employment contract with an employer and therefore are extremely vulnerable to abuse – is a case of this. Informal labour was always preponderant in India, but the expansion of homeworking, sweatshops, and the hiring of workers through intermediaries (‘labour contractors’, ‘agencies’, ‘gangmasters’ and so on) in countries which were formerly free of these problems (Mather 2005) has caused serious concern within the ILO in the 21^st century (ILO 2002).

In this context, the publication of International Trade and Labor Standards, with its carefully crafted proposal for a linkage between trade and labour standards that is both feasible and capable of stopping the downward pressure on labour standards, is of great importance. The authors have taken up objections to linkage in a step-by-step manner in order to formulate a proposal that meets almost all the arguments against it that are commonly put forward. This paper is an attempt to strengthen it by tackling some of the few remaining weaknesses.

World Trade and Workers' Rights: To Link or Not to Link?

 

The saddest thing about the confrontation which took place at Seattle in November-December 1999 was the absence of any voice speaking for Third World workers, either among official delegates to the World Trade Organisation (WTO), or among the protesters outside. One reason could be that it would be difficult for workers or their representatives from developing countries to travel to Seattle. But at least a subsidiary reason is the failure of trade unions from our countries to articulate a clear and consistent standpoint which could be argued at such a forum. This is a lack we urgently need to remedy.

Before we look more closely at the issues raised by the meeting, I would like to make my basic standpoint clear. Very simply, as I see it, the present world system is a capitalist one, and capitalism is by its nature exploitative and oppressive. I would like to see it replaced by a more egalitarian, cooperative, compassionate and caring system. However, I do not think that this end can be achieved without the active and conscious participation of the vast majority of the world's working people. This is not possible in the immediate future since these protagonists have a long way to go before they can unite around such a common goal. We are therefore constrained at the moment to work within the capitalist system in order to create the conditions in which a revolutionary transformation of the world system can take place. So the question which confronts us is: given these constraints, what should our attitude be to the linking of trade agreements of the WTO with workers' rights?