Earlier this week, U.S. President George W. Bush, Canada’s Prime Minister Stephen Harper, and Mexico’s President Felipe Calderón met to plan further integration of their three economies. Thousands of people protest these summit meetings, not because they oppose international cooperation but because they reject policies that benefit the rich and powerful at the expense of everyone else.
Globalization could benefit us all. Telerad is a Singapore-based corporation that analyzes X-rays and medical scans for hospitals around the world. Currently, it can take weeks to get results from a CAT scan or an MRI. Telerad promises that an image from New York can be analyzed and a report returned in less than half an hour.
This appears to be a win-win situation, providing more timely treatment at a lower cost, except that higher-priced American labor is being exchanged for lower-priced Asian labor.
Governments and corporations are shaping globalization the same way they shaped automation, to boost profits at workers’ expense.
By 2000, U.S. workers took half the time to produce all the goods and services they produced in 1973. If the benefits of this rise in productivity had been shared, most Americans could be enjoying a four-hour workday, or a six-month work year, or they could be taking off every other year from work, with no loss of pay.
Needless to say, this is not the case. All the benefits of automation went to the capitalist class. By 2000, the average American worker was putting in 199 more hours on the job, five weeks more than in 1973.
While ordinary folks work harder and longer for less, the capitalist class is hauling in the dough. In the mid-1970’s, average executive compensation was 35 times the average wage. By 1999, the average CEO of a major US corporation was taking home 330 times the average wage and 476 times the average blue-collar wage. By 2004, the portion of the economy going home with workers dropped to the lowest level ever recorded.
Divide and profit
Cathleen Wedlake has worked in the newspaper trade for 38 years. She and 30 of her co-workers were laid off when the San Jose Mercury News outsourced their jobs to Asia via Express KCS, an India-based corporation that provides production services for more than 40 newspapers in northern California.
National borders exist to maximize profits. Jobs are allowed to migrate to cheaper locations, while the people who work those jobs are blocked from moving to higher-paying locations.
The same year that the U.S. and Mexico launched their free-trade agreement (NAFTA), the Clinton administration launched Operation Gatekeeper to block Mexican workers from entering the U.S. Both moves served the interests of capitalists on both sides of the border.
American goods entering Mexico put small Mexican producers out of business, creating a more desperate (and therefore cheaper) workforce for larger Mexican employers and an immigrant (and therefore desperate and cheaper) workforce for American employers.
The solution to these problems is generally posed as a choice between free trade and protectionism. However, both policies benefit the capitalist class. Protectionist policies shield weaker industries from global competition, while free-trade policies enable stronger industries to penetrate foreign markets.
The American union movement has traditionally sided with the protectionist wing of capitalism. This strategy has failed to save jobs, as thousands of laid-off steel and autoworkers can attest. Protectionism undermines the labor movement by pitting American workers against their counterparts in other lands.
A more effective strategy is to demand an end to national borders and for workers to defend all jobs as if these borders did not exist.
Wedlake and her co-workers at the San Jose Mercury News face the same challenge as any workforce threatened with replacement by lower-paid workers. The solution is to include all workers in an industry into unions that do not stop at national borders and to demand wage parity across the globe. This is not a free-trade stance, but a pro-worker antidote to the divide-and-profit policies of employers.
While they promote free trade, not a single head of state supports opening borders to workers. On the contrary, capitalists go berserk at the thought of abolishing national boundaries because their system can function only by dividing workers and trapping them in low-waged areas. Instead of acknowledging their self-serving motives, they warn that open borders would flood America with impoverished people and drag everyone down. This is absurd.
If the benefits of global integration were shared, there would be little reason to move.
Globalization has deepened the conflict over which class will shape the future. The capitalist class are planning more misery for the majority. The alternative is for workers in all nations to come together as one workforce to demand equal pay for equal work.
Even better, we could dispense with the master class and direct global production to raising living standards everywhere.