19 August 2013

We must go global: the case of South Korea

If we don’t go global, we can’t win.

Consider, for example, recent developments in South Korea around temporary employment (covered here at the Financial Times, behind a paywall). The rise of temp work in the US and other developed countries is symptomatic of neoliberalism. And as with other neoliberal trends, it is intensifying as the neoliberal economy breaks down. We might be familiar with hand-wringing on the subject in popular press in the US, but it is a global phenomenon (see also France, Germany, Japan, etc.).

South Korea has been hit especially hard by this trend, and has one of the highest rates of temp employment in the OECD, but it is now reversing the trend, thanks to some of the most militant labor unions in the world. Led by temporary workers, unions have taken up the cause of ending temp employment. Sustained labor unrest has resulted in billions of dollars in losses for major corporations, and tens of thousands of temp workers at Hyundai and other major corporations have been granted permanent status (or other benefits and contract improvements in lieu of permanent status).

The overall results: even as temp employment expands in other countries and takes the place of regular employment, in South Korea temp employment has fallen, and regular employment is on the rise. These developments are remarkable, and ought to be a source of inspiration to everyone on the left. They should certainly receive greater attention than they have from leftists and unions in America. (It is worth considering why they have not.)

But these victories also threaten to undermine themselves.

We must understand that the rise of temp labor under neoliberalism was not orchestrated on a whim, nor out of gratuitious greed. Rather, it is a response to the fundamental forces of the neoliberal economy. In general, when neoliberal capitalists erode wages and working standards, it is not just because they are greedy bastards. (Typically they are greedy bastards, but that is a superficial phenomenon.) Individual capitalists are at the mercy of market demands which confront them with the force of compulsion. The neoliberal market demands lower labor costs, which means means lower wages; it demands a more flexible workforce, and this means less job security. Capitalists must comply with these demands, or else. If (hypothetically) there were a capitalist not so dominated by greed, who decided to resist these market forces for the sake of worker rights, the market would respond with punishing force, and the capitalist would be replaced. (Note that these are features of neoliberalism, not ahistorical features of capitalism. Fordist capitalists were also greedy, but under Fordism their greed was compatible with rising wages and a much higher degree of job security, which they provided.)

From the point of view of the market, the South Korean labor unions’ campaign against temp employment is undermining the capitalists’ ability to maintain a competitive labor force in the country. As a result, corporate leaders and allied commentators are voicing concerns that these wins for temp workers are creating obstacles to investment and hiring in the country. Now, no doubt at least part of this is bluster and propaganda, but we must see that there is a core of truth to the capitalists’ pleas. It is simply a fact that as labor costs in South Korea increase, so does the pressure to relocate South Korean manufacturing to other countries. Even if the capitalists should harbor some desire to keep the jobs in South Korea, the market will have its way in the end. The greater the gains that the South Korean unions make, the more they risk capital flight, which would result in nothing but pain for the national economy and for the workers themselves.

The South Korean labor movement thus brings us face to face with a fundamental feature of the neoliberal economy: the global race-to-the-bottom. This is the mechanism through which the need for temporary work is inflicted upon national economies, along with so many other pernicious features of neoliberalism. When it comes to the status of labor or anything else that can significantly impact competitiveness in the global market (corporate taxation, environmental protection, etc.), sufficiently deep progressive victories in any single nation will result in capital flight from that nation, wiping out those progressive gains. The situation in South Korean is just one illustration of how the dynamics of the global marketplace threaten to swallow up any advances progressive forces might make at the national level.

The risk here is great, but so is the opportunity. The labor unions must see that the struggle is only apparently:

South Korean labor vs. South Korean capitalists

For the South Korean capitalists are themselves beholden to a greater master: the global neoliberal economy and the race-to-the-bottom labor market which is essential to it. In reality, then, the struggle is:

South Korean labor vs. the global race-to-the-bottom

And if that’s where the struggle remains, then South Korean labor is doomed. For its power is contained within the national arena, but it is fighting a foe which transcends that realm. There is one and only one solution (apart from retreat, if we consider that a solution), and that is for the struggles of South Korean labor to take their place in the broader struggle:

Global labor vs. the global race-to-the-bottom

The global race-to-the-bottom requires that workers of different countries relate to each other as competitors. If South Korean labor were to overturn this order and transform those foreign workers from competitors into comrades—if they were to take up a struggle for the wages and working conditions of others in global labor solidarity—that would mark the beginning of a struggle against the global race-to-the-bottom. This is the only way for South Korean labor to protect its own remarkable victories. And this would finally bring the left into a direct confrontation with neoliberalism itself.

Of course, this is easier said than done. In future posts I will suggest that the conditions in South Korea (which are not, in the relevant respects, unique) make the idea of a global labor struggle more than merely utopian.

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