Although the economic crisis in Britain doesn’t officially exist, with pundits and politicians all talking up the health of UK plc, its effects nevertheless continue to devastate parts of the working class. The latest sectors to be hit are car workers at Peugeot and Vauxhall. Less than a year since MG Rover announced 6,000 job losses, Peugeot has announced the closure of its Coventry plant with 2,300 jobs lost and GM is gearing up to cut 900 from its Vauxhall workforce. These closures are part of a whole series of cuts to the car industry which have been going on for decades, reflecting the growth of the crisis itself and the effects it has on the weaker capital formations. In the 1970’s, when the crisis first hit, UK based Ford, GM and Chrysler/Peugeot plants were shut down. This was followed in the ‘80’s by smaller closures at Abingdon, Canley and Speke. The last ten years have seen the closure of many of the larger centres, including Ford at Dagenham, Vauxhall at Luton and Longbridge. In every battle the unions have sold workers the logic of a smaller, more efficient workforce and the importance of keeping the industry profitable in order to keep it in the UK. This has left workers weaker, their numbers depleted and their ability to fight reduced. The workers at Peugeot and Vauxhall have a tough fight on their hands, one which, if they accept union logic, will lead to them losing their jobs altogether.

Crisis cuts deep

As unemployment in Britain in May 2006 rose to 1.6 million, its highest rate in over three years, the Office for National Statistics announced that the number of manufacturing jobs in the UK had fallen to its lowest level since records began in 1978. Manufacturing jobs in the UK have now declined to 3.06 million. This means only about 10% of workers are now employed in manufacturing. At the start of the restructuring phase for British industry in 1979 there were 7.1 million jobs in manufacturing representing 25% of the UK workforce. The relentless decline has continued no matter which faction of the ruling class has been in power. Under the Labour government, supposedly the faction which supports British manufacturing, 1.5 million manufacturing jobs have been lost since it came to power in 1997. This represents about 14 000 jobs lost every month. The car industry is one small part of this with Peugeot stating its net profits had fallen from 1.65 billion euros in 2004 to 1 billion euros in 2005. GM reported in April ‘06 a $323 million loss in the first quarter, and for the whole of 2005 they reported a loss of some $10.6 billions.

Decline in car industry

The search for profits has pushed much of the car industry abroad to exploit cheaper labour power. ⁽¹⁾ The Communications Director of Peugeot, John Goodman stated that every car produced in the UK cost 415 euros more than anywhere else in Europe. And now Eastern Europe, with its cheaper workforce, looks like a far more attractive option. The average wage in Western Germany in the automotive component industry in 2005 was 25.8 euros per hour, while in the Slovak Republic it was 3.3. The logic of global capital may be to push wages down and move production from high labour cost areas, but it will only do this where it is unchallenged. Labour costs elsewhere in Western Europe may be on par with Britain, but it is Britain which is haemorrhaging jobs. This is despite the best efforts of politicians trying to maintain the image of UK plc with bribes to companies to stay. The chancellor, Brown, for example, offered GM Government ‘grants’ of up to £15 millions to keep production in Britain.

Union compromise brings defeat

The response of British workers to the whittling away of employment law by the Labour Government has been muted to say the least This should be contrasted with France, where attempts to bring in the ‘Contrat de Premiere Embauche’ (the CPE) ⁽²⁾, which would have enabled bosses to fire workers without notice and for no reason led to an explosion of class struggle on a scale not seen for decades (see the articles on the CPE struggles in this edition).

British workers who accepted the arguments of the unions that cheaper labour would secure their jobs now have to face the fact that companies will move from Britain rather than from France because the militancy of the French working class would make it too difficult for them to do so. British workers for years have been told by their unions that only by increasing productivity, by accepting cuts and low wages to save the industry and above all by agreeing to fewer rights when it comes to redundancy they would save their jobs. When General Motors Europe Chief Executive, Carl-Peter Forster said:

We know, thank God, that the English labour market is more capable of absorption than, let’s say, the German or the Belgian markets. ⁽³⁾

The unions were the first to condemn him as though they were innocent of any part of it. In fact the unions have always been instrumental in getting the working class to accept the logic of capitalism and have caved in at every opportunity in order to save their industry. And they have greeted this round of attacks not with talk of any class fight back but solely in nationalistic terms of defending British jobs and British industry. Des Quinn of the TGWU initially blamed French bosses for the cuts then rolled out a plan to save the industry which he admitted would involve job losses. He followed this up with a consumer boycott.

We are looking initially at a social and political campaign which might involve disruption to car sales. ⁽⁴⁾

Amicus followed suit with Derek Simpson stating:

Unless GM are prepared to treat decent men and women in Britain with some dignity, we will cancel our £8m contract with Vauxhall cars. We will encourage our members to buy their cars from a manufacturer who supports the British economy and urge other unions to do the same ⁽⁵⁾

No doubt General Motors is shitting itself. Both unions argued that job losses should be exported to workers elsewhere in Europe, especially Belgium and Germany. Tony Woodley, General Secretary of the T&G attacked the Government for not being patriotic enough.

You don’t see the same losses in Germany, Italy or France because they protect their manufacturing. We have no plan to support our companies ⁽⁶⁾

In all this the real ideology of the Trade Unions is clearly revealed. They start by giving themselves the role of the lieutenants of the bosses in organizing capitalism. In this role they give useful advice on how to run capitalism, cuts, they say, should be in this plant, in that country and so on. When this helpful advice is rejected they put themselves forward as the vital consumers of the products which their members produce and threaten to switch their consumption to the products of other capitalists. Instead of Vauxhall cars we will buy Nissans! When this in turn is ignored they condemn the bosses for not being patriotic enough. The bosses of multinational firms are, of course, internationalist in their outlook and are interested in exploiting the international working class not any particular section of it. The poisonous nationalism in the remarks quoted above from Woodley and the rest of them shows how the unions actually support the more reactionary factions of the capitalist class. The struggles of today, particularly in the international industries like the car industry, immediately have an international dimension. There is absolutely no way these struggles can be won unless workers accept this international dimension and support each other. Peugeot workers in France have already expressed solidarity with the workers threatened with redundancy in Coventry. Sparks of consciousness like this, which point the way forward for workers struggles, are immediately extinguished by the unions in a torrent of nationalism. For future struggles to succeed they will have to be launched outside of and against the unions.

Class struggle the only way forward

Thankfully workers at Vauxhall saw through the Unions anti-working class manoeuvres and rejected their consumer tricks, patriotic posturing and the unions themselves when they walked out on a one day unofficial action to protest against the attacks. A muted response it may be, but under the weight of Union propaganda it is a reassuring one nevertheless. It is never easy for workers to fight redundancies. Factory occupations often turn to pointless lock-ins and leave workers isolated. Strikes can often give bosses the excuses they are looking for to close down an unprofitable plant. However, when strikes are taken outside of union control and extended to other sections of the working class they are one of the strongest tools the working class has. Despite all the defeatist talk of the unions it is possible to stop jobs being axed, but only strikes with international support, organised by mass meetings of workers with recallable delegates working outside union control can stop the current losses. Unions will always try to divide workers industry by industry, area by area, and nation by nation. They will always try to reach a compromise acceptable to bosses which may win some small demand but which will ultimately be at higher price in the long run. Workers in Peugeot France have already expressed solidarity and action should be taken with them. The lesson from the French working class is clear: if you accept the logic of capitalism you are doomed. If you fight it you can win, although, of course, in this period any victory is temporary. The bourgeoisie will always come back with fresh attacks since they must reduce workers living standards if they are to have any hope of protecting the value of their capitals. Workers are protected only by their own militancy and struggle.

The problem is a global one and the attacks are global; the fight back, if it is to be successful, will have to be a global one also.

(1) See “Immigration and global capitalism” in this edition

(2) Contrat Première Embauche means “First Employment Contract”

(3) Quoted in BBC News Online

(4) Quoted in BBC News Online

(5) Quoted in BBC News Online

(6) Quoted in The Guardian, 17th May 2006