Fighting the race to the bottom
The ideological fragmentation and myopia we see in our world today is perturbing
The writer is a development anthropologist. He teaches at George Washington University
The ideological fragmentation and myopia we see in our world today is perturbing. The growth of ultranationalist and proto-fascist political power is not confined to the developing world, it is also afflicting affluent democracies as well.
Although it is often not portrayed in these terms, much of it has to do with the rapid concentration of power and money in the hands of a small group of people in rich and poor countries alike.
Stagnating middle-class growth, restricted mobility, and the vast amounts of depravation around the world, create fecund circumstances for a politics of hatred and blame. Opportunistic politicians assume power by harnessing discontent and deflecting it from the real causes of inequality. Using their twisted logic, political pundits have been using dangerous ideologies pitting blue-collar workers in the West against those in the developing world, in the name of religion, race or ethnicity.
It is unfortunate that the Marxist call for the workers of the world to unite was hijacked by authoritarian leaders and bureaucracies. On the other hand, workers in the capitalist world continued being undermined by flexible supply chains which outsource production to desperate developing countries.
Despite all the glib rhetoric about corporate social responsibility and ethical sourcing, the world production system is spiralling in a race to the bottom of lowest production costs to maximise profits for large corporations, and those who own and lead them.
While urging workers of the world to rise up in open revolt may be an unsettling concept, the idea of restoring and generating more power for workers worldwide, which allows them to negotiate together, rather than against each other, is a more viable solution to many other related woes.
The lingering inequality around the world is not an inevitable outcome of globalisation. It is, rather, the result of conscious decisions designed to grow profits for holders of capital. Recent research focusing on capital mobility has found that, after countries open their capital markets to cross-border transfers, domestic income inequality increases, the labour share of income invariably decreases.
The way that globalisation is currently structured is the real problem. The existing rules make it easier for companies to move production and jobs to any location that provides the maximum profit. International Labour Organisation (ILO) conventions concerning collective bargaining rights or decent work provide fairly general standards, which are easy to flaunt by national and international companies, and within the informal sector.
More effective enforcement mechanism is needed to guarantee that worker rights are protected in practice. Union groups have pushed multinational companies to adopt International Framework Agreements (IFAs), which commits them to respecting workers’ right to organise, but their success has also been constricted by a weak international legal framework.
Our global trade system must do more to protect the right to organise and bargain collectively, and to ensure that the unions for multinational companies operating within one country are encouraged to affiliate or ally with unions in other countries. Allowing international labour strikes would make it harder for multinational corporations to drive down wages and working conditions in one country by threatening to move elsewhere. Similarly, workers must be guaranteed the right to negotiate joint contracts covering a company’s global workforce. Developing countries must also be made to respect the rights of unionisation, using the carrot of aid and preferential trade agreements, if needed.
It is also vital to reform the rules of trade of the WTO, and bring more voices from the global South to forums like the IMF and the World Bank, which should begin focusing on redistributive notions, instead of trying to spur growth by relying on the already very rich.
In the same way that corporations can freely move jobs and funds across the globe, workers’ bargaining rights must be empowered to cross borders, even if allowing the free movement of people across borders is still difficult to achieve. Otherwise, the unmanageable and irregular economic migration of people will remain hard to prevent.
Published in The Express Tribune, November 3rd, 2017.
Although it is often not portrayed in these terms, much of it has to do with the rapid concentration of power and money in the hands of a small group of people in rich and poor countries alike.
Stagnating middle-class growth, restricted mobility, and the vast amounts of depravation around the world, create fecund circumstances for a politics of hatred and blame. Opportunistic politicians assume power by harnessing discontent and deflecting it from the real causes of inequality. Using their twisted logic, political pundits have been using dangerous ideologies pitting blue-collar workers in the West against those in the developing world, in the name of religion, race or ethnicity.
It is unfortunate that the Marxist call for the workers of the world to unite was hijacked by authoritarian leaders and bureaucracies. On the other hand, workers in the capitalist world continued being undermined by flexible supply chains which outsource production to desperate developing countries.
Despite all the glib rhetoric about corporate social responsibility and ethical sourcing, the world production system is spiralling in a race to the bottom of lowest production costs to maximise profits for large corporations, and those who own and lead them.
While urging workers of the world to rise up in open revolt may be an unsettling concept, the idea of restoring and generating more power for workers worldwide, which allows them to negotiate together, rather than against each other, is a more viable solution to many other related woes.
The lingering inequality around the world is not an inevitable outcome of globalisation. It is, rather, the result of conscious decisions designed to grow profits for holders of capital. Recent research focusing on capital mobility has found that, after countries open their capital markets to cross-border transfers, domestic income inequality increases, the labour share of income invariably decreases.
The way that globalisation is currently structured is the real problem. The existing rules make it easier for companies to move production and jobs to any location that provides the maximum profit. International Labour Organisation (ILO) conventions concerning collective bargaining rights or decent work provide fairly general standards, which are easy to flaunt by national and international companies, and within the informal sector.
More effective enforcement mechanism is needed to guarantee that worker rights are protected in practice. Union groups have pushed multinational companies to adopt International Framework Agreements (IFAs), which commits them to respecting workers’ right to organise, but their success has also been constricted by a weak international legal framework.
Our global trade system must do more to protect the right to organise and bargain collectively, and to ensure that the unions for multinational companies operating within one country are encouraged to affiliate or ally with unions in other countries. Allowing international labour strikes would make it harder for multinational corporations to drive down wages and working conditions in one country by threatening to move elsewhere. Similarly, workers must be guaranteed the right to negotiate joint contracts covering a company’s global workforce. Developing countries must also be made to respect the rights of unionisation, using the carrot of aid and preferential trade agreements, if needed.
It is also vital to reform the rules of trade of the WTO, and bring more voices from the global South to forums like the IMF and the World Bank, which should begin focusing on redistributive notions, instead of trying to spur growth by relying on the already very rich.
In the same way that corporations can freely move jobs and funds across the globe, workers’ bargaining rights must be empowered to cross borders, even if allowing the free movement of people across borders is still difficult to achieve. Otherwise, the unmanageable and irregular economic migration of people will remain hard to prevent.
Published in The Express Tribune, November 3rd, 2017.