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Introduction to Workers, Unions, and Global Capitalism

Abstract

Introduction to Workers, Unions, and Global Capitalism: Lessons from India
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INTRODUCTION
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).
One year after the bankruptcy of Lehman Brothers, there were superficial signs of
recovery; but a closer look at unemployment, poverty rates and foreclosures in the US
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showed that there was no end in sight for the suffering of ‘regular people’, while the
banking sector and Wall Street continued to act in a manner which ensured that ‘The
causes of the financial crisis continue unabated and in some cases have worsened
(Weissman 2009). While the prognosis in other countries might not have been so dire, the
downturn was far from over. The crisis has made it more urgent for the labour movement
to craft a viable response to globalisation, but also, paradoxically, has made it easier to
question the previously dominant model, given that it led to such a catastrophe.
The impact of globalisation on labour has been complex, even contradictory. Trade union
movements firmly anchored in national history and legislation found it difficult to cope
with global integration and the vastly increased mobility of capital; one consequence of
this was the decline in the proportion of the labour force organised in unions over the last
three decades of the twentieth century, which weakened the bargaining power of workers
(Harrod and O’Brien 2002: 10-11). Yet in the two decades between 1975 and 1995, the
global labour force doubled (Munck 2002: 8), making it potentially much stronger as a
social force. This book argues that recovery from the crisis depends, to a large extent, on
the judicious use of this power by workers worldwide.
The secular expansion in employment coexisted with drastic declines in some sectors,
including highly unionised ones. Large-scale industrialisation in some of the former
colonies and the end of the Cold War resulted in key East European and developing
countries emerging as attractive markets and investment destinations for global capital,
thus intensifying competition for jobs among workers who were formerly insulated from
such competition. Yet these very same events removed obstacles to solidarity between
unions in former colonies and imperialist states, and between unions on opposite sides of
the Iron Curtain. Convergence between employment conditions in different parts of the
world made it easier for workers from widely differing backgrounds to identify with one
another, potentially making global solidarity an achievable goal. Technologies that
facilitated the mobility of capital and global competition for jobs at the same time
provided workers with a means of spreading the consequences of a local dispute around
the world at rapid speed (Herod 2002).
Thus the negative fallout of globalisation for workers is accompanied by developments
that create the potential for counteracting those disadvantages and, indeed, building an
even stronger labour movement than before. But that would require, firstly, a rigorous
definition of globalisation, so that the impact of changes in the nature of capitalism
such as the revolution in Information and Communication Technologies (ICT) can be
disentangled from the neoliberal assault on workers’ rights. Secondly, it would entail a
drive to reverse the decline in union density, either by undertaking a drastic overhaul of
existing unions, or by creating new models of unionism, such as social movement
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unionism in South Africa, Brazil and South Korea (Moody 1997: 201-226, Munck 2002:
122-25), and employees’ unionism in India (Chapter 5 of this book). This drive would
have to include special measures to tackle the rapid spread of informalisation, which
creates employees without legal status or rights. The extra-legal character of this sector
breeds child labour, slave-like conditions, and all manner of abuses, which are
exacerbated by the preponderance of disadvantaged workers in it: women, ethnic and
religious minorities, migrants, indigenous people, and so on.
The third task would be to formulate a global strategy for labour. This does not mean
abandoning the local or national as an arena for struggle. But it does mean thinking
globally even when acting locally, because local action or inaction that allows
workers’ rights to be undermined in some distant part of the world results in an assault on
one’s own rights. For example, protectionist policies aimed at protecting and expanding
domestic employment at the expense of workers elsewhere ultimately have a negative
effect everywhere (Stevis 2002: 146). Global solidarity in this sense has become a
condition for survival, and it demands a much greater knowledge of developments in
other countries than ever before. It also demands a fundamental change in the strategic
orientation of unions, which has hitherto been centered on the nation-state. Even the
largest international confederation, the International Confederation of Free Trade Unions
(which merged in 2006 with the World Confederation of Labour to form the International
Trade Union Confederation) was ‘a confederation of national trade union centres, which
means that its governing bodies are composed of representatives of organizations
accustomed to think and act within the confines of the nation-state’ (Gallin 2002: 238).
The alternative is not necessarily a monolithic global organisation, but, rather, a global
movement unified by its goals, and developing its strategies through debates across all the
borders that divide workers.
The central argument of this book, then, is that globalisation itself cannot be reversed,
any more than the industrial revolution could have been reversed, but the politics of
globalisation constitutes terrain that can and must be contested by workers and unions if
the world economy is to emerge from deep crisis. Therefore a global strategy for labour
would require workers not to oppose globalisation, but to fight for their own politics,
based on global solidarity and democracy, to shape the process.
The importance of the local
It is a paradox of globalisation that ‘the greater interconnectedness of the global
economy…which high-speed telecommunications and transportation technologies have
augured mean that the consequences of any particular event can be transmitted much
further and much faster than ever before’ (Herod 2002: 87), and consequently local
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events become global ones. In other words, ‘the growing extensity, intensity and velocity
of global interactions may also be associated with a deepening enmeshment of the local
and global such that the impact of distant events is magnified while even the most local
developments come to have enormous global consequences’ (Held et al. 1999: 15). If this
is true of a particular event, it is even more true of labour relations in a whole country:
the lowering of barriers to trade and capital movements not only exposes a country’s
labour force to influences from the global economy, but also exposes the rest of the
world’s labour force to the influence of a particular country’s economy. Recognition of
this on the part of trade unions resulted in the campaign for a social clause in WTO trade
agreements upholding core labour rights. China has understandably received a great deal
of attention because of the size of its labour force, the ubiquitousness of its products, and
an authoritarian political system that bans independent unions. But there is a curious lack
of interest in India, given that it follows closely on the heels of China in terms of the size
of its labour force and its growing importance within the global economy.
One reason for this difference could be the perception that labour relations in China
constitute a bigger threat to workers in other countries than labour relations in India, but
this is not necessarily true. In China, the pre-liberalisation social contract, guaranteeing
job security and extensive welfare benefits for workers, created such a strong sense of
entitlement that the government had to replace it with a labour law promising workers’
rights and social security in order to counter massive social unrest, with millions of
workers per year involved in riots and demonstrations between 2003 and 2005 (Lee
2007). In India, by contrast, the overwhelming preponderance of informal workers in the
labour force meant the absence of either social or legal contracts promising workers’
rights to them; the sense of entitlement and thus scale of protest were correspondingly
much smaller.
Both Chinese and Indian workers have gained employment from offshoring and
outsourcing. But the Chinese model of attempting to deny workers’ rights cannot easily
be replicated in countries with a different legal system, whereas the Indian model, where
the bulk of the labour force is not even registered or accorded legal status as workers, is
far more insidious, and has, in fact, spread rapidly to countries where it was rare or
unknown before. On the other hand, India has suffered less from the crisis than the US or
EU. Although stock markets plunged as Foreign Institutional Investors withdrew their
funds, its well-regulated banking sector, with a negligible exposure to toxic assets, stood
firm (Ram Mohan 2009). And while tens of thousands of jobs were lost in sectors
producing for export, the overall increase in unemployment and consequent loss of
consumer spending power were mitigated by the National Rural Employment Guarantee
Scheme (see Chapter 8), which was up and running before the crisis and was allocated
more funds after it began. Furthermore, the decline in membership among traditional
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trade unions was offset by the establishment and growth of a dynamic new federation of
independent unions. Thus there are both positive and negative lesson to be learned from
the Indian experience, and workers and unions in other countries cannot afford to ignore
them.
In July 1991 the Congress government, headed by Narasimha Rao, had foreign exchange
reserves sufficient for just a fortnight’s imports. To deal with the crisis, it began to
implement the stabilisation and structural adjustment programmes that had already been
recommended by the IMF and World Bank in the late 1980s. This included the abolition
of licensing procedures for manufacturing investment (which had popularly come to be
known as a corruption-ridden ‘license-permit raj’), reduction of the high import tariffs on
most goods (but not consumer goods), liberalising terms of entry for foreign investors,
and liberalising capital markets. Although Rajiv Gandhi had initiated a process of
piecemeal liberalisation in the mid-1980s, the changes introduced in 1991 were much
broader in scope and scale (Balasubramanyam and Mahambare 2001).
When the WTO was established on 1 January 1995, India was a member from the start.
This involved new pressures, for example to eliminate quantitative restrictions on
imports, simplify and reduce tariffs, reduce export constraints, reduce the number of
activities reserved for the public sector and small-scale sector, further liberalise the
Foreign Direct Investment regime, and address the fiscal deficit. The process of
integrating India more closely into the world economy has been more or less continuous
since 1991, despite changes of government. This book examines how it is has affected
workers and how they have responded, especially in one of India’s biggest industrial
centres, Bombay.
1
It makes numerous comparisons with examples from all over the
world, drawing out lessons, both positive and negative, for a global strategy for labour.
Chapter 1 outlines the background that led to this research and discusses the research
method used,
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explaining why the method of emancipatory action research is more
appropriate in this case than the attempt to be ‘objective’. My theoretical approach is
presented so that it is clear where I am coming from and why this analysis was
undertaken. Chapter 2 arrives at a working definition of globalisation by examining
existing definitions and making a critique of some. The merit of my definition is that it
allows for a more nuanced response to globalisation than either embracing it in its
neoliberal form or rejecting it altogether. Chapter 3 examines four sources of the
economic crisis of 2008, and suggests how three of them can be counteracted. The fourth
the widening gap between rich and poor can only be redressed by a strong labour
movement, and chapters 4 to 9 look at ways in which this can be done. Chapter 4 looks at
the trade union movement in India against the background of the worldwide labour
movement, examining in particular its relationship with the state. It argues that
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globalisation reduces the power of individual states to protect labor rights, but creates the
conditions for member states of the WTO to protect workers’ rights collectively. Chapter
5 discusses the importance of trade union democracy for the learning process in the
labour movement, and defines and examines an important experiment in union
democracy, the ‘employees’ unions’ which have been formed spontaneously as an
alternative to the party-affiliated national unions in India.
Chapter 6 takes up informal employment, definitions and debates around it, and the
conditions of informal workers, arguing that informal labour constitutes the single biggest
problem facing the global labour movement in the early 21st century. It examines
strategies to confront informal labour suggested by trade unions, informal workers and
the ILO. Chapter 7 examines the adverse impact of sexual harassment on women
workers, and analyses the gender division of labour at the workplace and in the home.
Strategies to defend the equality and dignity of working women are discussed. Chapter 8
argues that massive resources are needed to create employment and support social
security and welfare programmes if the world is to emerge from recession, and a struggle
by unions against the narrow vested interests promoting militarism can release them.
Chapter 9 looks at international efforts to deal with the effects of globalisation on labour,
including international agreements between trade unions and employers, international
solidarity action, codes of conduct, and the proposal for a social clause protecting
workers’ rights in WTO agreements. It examines the way in which employees’ unions
and informal workers in Bombay have used, reacted to, or participated in such efforts,
emphasising examples of international solidarity. Their potential for improving workers’
rights globally is evaluated. Finally, Chapter 10 draws out and puts together conclusions
arising out of the preceding chapters, which suggest strongly that only a truly global
strategy for labour is capable of confronting the challenges of globalisation and crisis.
My hope is that this analysis of global labour from the perspective of a crucially
important section of it will contribute to a better understanding of globalisation, and
especially to a realisation that workers can and do play a role in shaping the process. This
role could be much greater and indeed must be greater if the global economy is to
recover from the crisis. My argument is that realising this potential depends on the ability
of workers throughout the world to build bonds of solidarity across existing divisions,
and elaborate a strategy synthesising the interests of all sections of the global labour
force.
Notes
1
Since the name of the city was officially changed to ‘Mumbai’ in 1997, I should explain why I
continue to use the older name. The origin of the name ‘Bombay’ is somewhat obscure, but it has
been used for the past four hundred years by most of its multifarious inhabitants. For roughly the
7
same length of time, its Marathi name has been ‘Mumbai’, derived from the Hindu goddess
Mumba Devi (‘ai’ is Marathi for ‘mother’). The campaign to change the official name to Mumbai
was spearheaded by the Shiv Sena, an extreme Right-wing Hindu and Marathi chauvinist
organisation. One plank of its programme was the replacement of ‘Bombay Hindi,’ which has
evolved spontaneously as the link language for people from all over India who have settled in
Bombay, by Marathi. Another was the stoking of anti-Muslim sentiment. In 1992-3 it was
involved in the demolition of the Babri Mosque and pogroms against Muslims in Bombay, and it
has at various times carried out brutal attacks on South Indians, Communists, Muslims, Christians
and others. I have no objection to the Marathi name being Mumbai, but I and many others feel
that the official change of name to Mumbai is associated with an attack on the ethnic, religious
and political diversity of the city, and with ethnic cleansing drives against minorities.
2
This describes my ‘method’ in the broader sense, encompassing philosophical outlook and
theoretical framework as well as techniques for collection of material, and not in the narrow sense
of techniques alone (Harding 1987).
... These sectors are typified by conditions of flexible specialization, organizing through sub-contracting, sweatshops, and home-based production systems; workers often do not fall under the purview of state regulations making them vulnerable and insecure in their occupations by not allowing them job and income security, inhibiting skill reproduction, and weakening their representation in the labour market (Chen 2012: 1). This has led to increasing casualization and contractualization, a rise in self-employment and homebased activities, and the feminization of this labour force (Hensman 2011). When poor women enter such exploitative institutions, they usually have to depend on their physical labour to meet survival requirements. ...
... These sectors are typified by conditions of flexible specialization, organizing through sub-contracting, sweatshops, and home-based production systems; workers often do not fall under the purview of state regulations making them vulnerable and insecure in their occupations by not allowing them job and income security, inhibiting skill reproduction, and weakening their representation in the labour market (Chen 2012: 1). This has led to increasing casualization and contractualization, a rise in self-employment and homebased activities, and the feminization of this labour force (Hensman 2011). When poor women enter such exploitative institutions, they usually have to depend on their physical labour to meet survival requirements. ...
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The world is experiencing one of the largest movements of people in history with 65 million people displaced by conflict in 2015, the majority of which were from Asia. This book brings a deep engagement with individuals whose lives are shaped by encounters with borders by telling the stories of a poor Bangladeshi women who regularly crosses the India border to visit family, of Muslims from India living in Gulf countries for work, and the harrowing journey of a young Afghan man as he sets off on foot to Germany. The international and interdisciplinary work in this book contributes to this moment by analyzing how borders are experienced by migrants and borderlanders in South Asia, how mobility and diaspora are engaged in literature and media, and how the lives of migrants are transformed during their journey to new homes in South Asia, the Middle East, North America, and Europe.
... These sectors are typified by conditions of flexible specialization, organizing through sub-contracting, sweatshops, and home-based production systems; workers often do not fall under the purview of state regulations making them vulnerable and insecure in their occupations by not allowing them job and income security, inhibiting skill reproduction, and weakening their representation in the labour market (Chen 2012:1). This has led to increasing casualization and contractualization, a rise in selfemployment and home-based activities, and the feminization of this labour force (Hensman 2011). When poor women enter such exploitative institutions, they usually have to depend on their physical labour to meet survival requirements. ...
... These sectors are typified by conditions of flexible specialization, organizing through sub-contracting, sweatshops, and home-based production systems; workers often do not fall under the purview of state regulations making them vulnerable and insecure in their occupations by not allowing them job and income security, inhibiting skill reproduction, and weakening their representation in the labour market (Chen 2012: 1). This has led to increasing casualization and contractualization, a rise in self-employment and homebased activities, and the feminization of this labour force (Hensman 2011). When poor women enter such exploitative institutions, they usually have to depend on their physical labour to meet survival requirements. ...
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Full-text available
The world is experiencing one of the largest movements of people in history with 65 million people displaced by conflict in 2015, the majority of which were from Asia. This book brings a deep engagement with individuals whose lives are shaped by encounters with borders by telling the stories of a poor Bangladeshi women who regularly crosses the India border to visit family, of Muslims from India living in Gulf countries for work, and the harrowing journey of a young Afghan man as he sets off on foot to Germany. The international and interdisciplinary work in this book contributes to this moment by analyzing how borders are experienced by migrants and borderlanders in South Asia, how mobility and diaspora are engaged in literature and media, and how the lives of migrants are transformed during their journey to new homes in South Asia, the Middle East, North America, and Europe.
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