Will Hutton and
Anthony Giddens
The New
Press, New York, 2000,
241 pages.
By Roger
Bybee
On October 4,
1996, long-time workers at Johnson Controls’ valve plant in Milwaukee were
rewarded with a lavish dinner and plaques and pins for their years of service
to the company. For workers who had reluctantly accepted severe economic
concessions and labored hard to make the plant “competitive,” the company’s
gesture was a long-overdue but still very welcome gesture of gratitude.
However, on
October 9, the workers received another, more frank token of this Fortune 500
corporation’s appreciation: official notice that the company was closing the
highly profitable plant and shipping their jobs off to a site that beckoned
with even higher profits: Reynosa, Mexico.
The 180 workers
at Johnson Controls became more victims of a particularly ruthless form of
globalization: a political regime where U.S. corporations are free to shift
work to nations where thinly veiled dictatorships hold down wages as a means
of attracting investment. Wages at the Johnson Controls Reynosa plant start at
72 cents an hour, “far below what most people would considerable a sustainable
wage for the workers and their families,” as a Milwaukee priest complained to
distinctly unimpressed Johnson Controls stockholders.
U.S. News &
World Report once approvingly described Ree- bok’s strategy as one of
“global hopscotch,” detailing how this footloose shoe manufacturer continually
relocated to ever-lower wage sites, abandoning plants in Asian nations
whenever democracy and labor unions sprouted up. When the workers in Indonesia
or elsewhere rise up to push wages to a subsistence level, executives from
corporations like Nike warn them, “there’s concern what this does to the
market—whether or not Indonesia could be…pricing itself out of the market,” as
Nike spokesperson Jim Small sounded the alarm in April, 1997 when the minimum
wage hit a stratospheric $2.46 per day.
Or when Mexican
border communities, almost afloat in sewage and chemical wastes resulting from
the doubling in the number of “maquiladora” plants since the signing of the
North American Free Trade Agreement, they encounter corporate executives
making threatening noises about relocation. Even the right-wing Wall Street
Journal once described the border haven for U.S.-owned factories as “a
sinkhole of environmental degradation and miserable living conditions.”
Such a
suggestion that corporations bear any social responsibility instantly
triggered alarm among U.S. executives. “I think you will see a slowdown in the
growth of maquiladoras until we see how big the increases are,” warned one
U.S. corporate consultant.
General
Electric CEO Jack Welch, whose corporation gobbled up hundreds of millions of
U.S. tax credits in the name of job creation while downsizing roughly
two-thirds of its U.S. workforce since 1980, outlined the new philosophy of
corporate globalism in stark terms: “Ideally, you’d have every plant you own
on a barge.”
Given the
massive inequities and social dislocations produced by a dedication to maximum
profit, one would expect that a book entitled Global Capitalism would
be brimming with moral outrage and crammed with detail about the human
consequences of unalloyed avarice spreading across the planet. But instead,
editors English sociologist Anthony Gid- dens and economics writer Will Hutton
offer up a remarkably arid defense of the basic pillars of corporate
globalism, suggesting only that its most brutal edges be softened by tepid
compensatory programs. The stunning inability to either comprehend the searing
wounds inflicted by corporate rapaciousness or conceive of more humane
systemic alternatives is baldly stated in the book’s concluding chapter: “The
task, surely, in the absence of alternatives, is to keep the current system
going and improve it.”
Most
strikingly, Giddens in particular seems to be uninterested in the fate of
global capitalism’s victims, like the workers at Johnson Controls who lost
stable jobs in Milwaukee and those in Reynosa and elsewhere laboring long
hours for multinational corporations in the Third World for below subsistence
wages. Displaying utter blindness to the vast evidence of suffering caused by
the NAFTA hurricane afflicting Mexican workers and peasants, Giddens blithely
pronounces, “The Mexican economy seems to be doing pretty well out of the
deal.” If by “the Mexican economy,” he confines his measurement to mean the
swelling ranks of billionaires, he is correct.
In the same
vein, Giddens is nothing but enthusiastic over Russia’s embrace of the market,
despite the appalling human cost as measured both in plummeting incomes and
sharply falling lifetime expectancy. Russia’s privatizers have truly pulled
off a remarkable achievement: rare in human history has massive misery been so
intensified for so many people so rapidly. A new Russian proverb expresses the
brutal story, which Giddens misses: “Everything the Communists said about
communism was a lie but everything they said about capitalism turned out to be
the truth.”
With the
exception of a few chapters authored by critics of the global economy,
Global Capitalism is a non-stop violation of the great sociologist C.
Wright Mills’ dictum in The Sociological Imagination that no one should
ever write more than two pages without a specific example in mind. Giddens and
Hutton’s sections of the book span dozens of pages with hardly a meaningful
case being cited.
While an ardent
defender of a Clinton-Blair “Third Way” that departs both from neo-liberalism
and any form of socialism, Giddens is positively giddy about the achievements
of the new global economy. The absolute nadir of the book comes when, in a
dialogue with Hutton, Giddens declares, “capitalism without communism isn’t as
wild or as dangerous as you make it seem, and is more resonant with positive
possibilities.” It is difficult to determine where, if anywhere, he would
actually separate his policies from those of what has come to be called
“savage capitalism.” He jovially swallows the North American Free Trade
Agreement despite its evident failure to reach any goal except expanded
profits for U.S.-based firms. He passionately embraces the World Trade
Organization and mourns its train-wreck of a gathering in Seattle. Giddens
seems untroubled that “A constitution for the world economy” (in the words of
the WTO’s founding president) somehow managed to utterly exclude any
representation from the subject classes in shaping that constitution.
Bizarrely, the
book includes a discussion on how Richard Sennett relates to his Korean
dry-cleaner in New York, but nothing on how Nike CEO Phil Knight—worth at
least $5.3 billion—connects with his vast global workforce. Nor does Global
Capitalism deign to explore what Charles Bowden calls the “Experiment for
the Future” along the U.S.-Mexican border, where First World technology is
paired with dire Third World exploitation in “maquiladora” plants to enrich
transnational corporations in a nightmarish new world of acute suffering,
brazen pollution of the air and water, and appalling official corruption.
One almost gets
the picture of a book assembled by editors who never bothered to read the
contributions of some of the authors. In the case of pieces by financier
George Soros and former Federal Reserve chairperson Paul Volcker, the reader
is left to wander through a thicket of international bankerese without any
assistance from the editors. Meanwhile, sociologist Manuel Castells, who has
made immense contributions to urban theory, is clearly adrift in a rambling
discourse on the new information economy.
Still, there
are some good pieces in this collection: crisply written articles by Lawrence
Mishel and Jeffrey Faux on the inequality which is the distinct trademark of
the new globalism; Robert Kuttner on the vital role of government action in
protecting citizens from the corporations devoted strictly to maximizing
stockholder value; and Vandana Shiva laying out the frightening stakes
entailed in the emerging domination of world food supply by giant corporations
who seek to tighten their grip through dangerous genetic modifications. An
essay on global culture by Polly Toynbee captures the complexity of the
interaction between Western and Third World cultures and also offers a
powerful critique of the increasing concentration of media power. But despite
these contributions, one gets the sense that the editors remain oblivious to
the anti-democratic essence of the corporate-dominated world.
Here are some
of the most crucial points missed by Global Capitalism’s editors:
1. The global
corporatism represents a repudiation of any bond except to maximizing profits.
Linkages to loyal workers, communities, and even nations have all become
irrelevant. As economist William Tabb concisely explains, “Companies that do
not aggressively maximize shareholder value had been taken over by those who
will throw out the old managers and downsize the workforces. The momentum has
been relentless and hardly limited to restoring past profit margins. It has
been about maximizing returns to owners, regardless of the impact on workers
and communities” (“Labor and the Imperialism of Finance,” Monthly Review,
October 1999). In the new global economy, all the advantages lie with those at
the top of the pyramid, as outlined by Faux and Michel: “People at the top of
the income distribution in all counties not only have deeper financial
reserves; their income is almost more likely to be generated from capital that
is more mobile and therefore more able to avoid being trapped in depressed
economies. People at the bottom, however, whose income is generated by their
labor, are tied much more tightly to their immediate economic surroundings.”
Constraints on
corporate conduct such as union contracts, labor laws, and pledges made to
communities in exchange for tax breaks are all regarded like antiquated
treaties with Native Americans, which need not be taken seriously since they
have long out-lived their usefulness and the other party seems destined for
extinction. Thus, while countless major corporations promised to increase
their U.S. employment as a result of increased exports to Mexico under NAFTA,
a Public Campaign’s Global Trade Watch studied 66 corporations making such
pledges and learned that 61 failed to live up to their public statements. But
apart from marginalized labor unions and publications of the Left, no
mainstream voice in U.S. politics seems to have noticed.
2. The global
economy is not a force of nature like gravity which is naturally bound to drag
down conditions, as Wisconsin AFL- CIO President David Newby puts it. The
global economy is a political structure premised upon institutions like the
IMF, World Bank, World Trade Organization, trade agreements like the North
American Free Trade Agreement, subsidies for exports, and insurance against
expropriation of overseas investments.
Moreover, the
impacts of globalization vary widely, particularly in terms of the political
constraints, which labor and other democratic movements have placed on the
absolute freedom of corporations to relocate work without regard to social
costs. Thus, wages in Western Europe have consistently been much higher than
U.S. workers’ pay, with a differential of roughly 40 percent in 1993.
Similarly, the number of hours worked by U.S. employees now exceeds even the
Japanese, once mocked in the U.S. as robot-like workaholics.
As noted by
Gary Teeple in Globalizaton and the Decline of Social Reform, there is
no mistaking that the full-blown emergence of global capitalism has
considerably shrunken the space for reforms benefiting the majority of
citizens. “The decline of the powers of the national state in the face of the
global economy has lessened the leverage for enacting reforms and diminished
the jurisdictions in which reforms could be enacted and enforced.”
Still, the
global economy’s structure varies enormously from nation to nation. The key
variable is not an immutable economic force, which is like some mysterious
deity, which we primitives must worship with offerings of pro-market reforms.
Rather, the global economy is the product of specific policy choices made by
elite forces in society with markedly decreasing concern for those on the
bottom rungs.
3. The
architecture of the global economy has been shaped by enormous political
investments by elites, especially in the U.S. where 1 percent of the people
provide 80 percent of the contributions to federal candidates. While 56
percent of Americans surveyed in 1996 felt that trade agreements like NAFTA
resulted in job loss and dislocation for Americans, fully 65 percent of large
donors (those providing at least $5,000 to federal candidates) approved of
such trade deals “even when jobs are lost.” In a telling coincidence, the U.S.
House passage of Permanent Normalization of Trade with China—opposed by 79
percent of Americans—was followed quite fittingly the very same day by a
record-setting Democratic fundraising event that raked in $26 million.
Obviously, the opinions of the donor class are the only ones worth considering
in the current political environment.
4. The
political investments of elites have been paralleled by a media offensive in
support of unfettered “free trade.” The propaganda blitz for “free trade” on
the nation’s editorial and news pages harkens back to Eastern Bloc
journalism’s lockstep obedience to the party line during the darkest days of
Stalinism. With most journalists far more conservative than average Americans
on economic issues, both news coverage and editorial content have reflected a
stunning imbalance in praise of corporate-style globalization. Even supposedly
liberal publications like the Washington Post and New York Times
have not editorialized consistently in support of “free trade” in the face of
damning evidence that it fails to live up to its claims, but they have largely
closed their op-ed pages to critics of the global economy. During the NAFTA
debate, Sen. Byron Dorgan (D-North Dakota) documented that the Washington
Post gave NAFTA proponents nearly seven times as much op-ed space as
that afforded critics of the trade deal. Most dramatically, by my count,
exactly 2 of America’s 1,300 daily newspapers editorialized against NAFTA.
Such 99.99 percent uniformity of editorial opinion is usually witnessed only
in the most repressive of nations.
While there
have been notable outbursts of revulsion against globalism, as with the
anti-WTO demonstrations in Seattle and the anti-IMF and World Bank actions in
Washington, popular resistance is still small in proportion to the scope of
economic, social, and environmental disruption brought on by transnational
corporate forces. The new global capitalism has severely eroded key
long-standing institutions and social networks (eg., urban neighborhoods and
labor unions) that were the backbone of resistance to earlier abuses by the
system. As Frances Fox Piven and Richard Cloward write in The Breaking of
the American Social Contract: “Changes in the location of production, as
well as changing patterns of consumption and settlement, are also transforming
the communities and culture of even those who remain industrial workers…As
industrial capitalism has reorganized domestically and dispersed globally, a
primary impact has been disorganizing the working class and escaping its
leverage.”
Those
distressed by the damage wrought by global capitalism will need to grapple
with the implications of this disruption of community, which severely hampers
the ability of working people to respond collectively.
Equally
daunting for progressives is the lack of political imagination, both in
dominant circles and among the subordinate classes, which makes it impossible
to seriously contemplate and debate any alternatives. The very notion of an
economic order designed to serve human beings—rather than the intensified
distortion of human existence in order to fit the demands of the global
marketplace through low pay, longer hours of work, and a loss of democratic
voice in both the workplace and larger society—is rarely discussed. The
crumbling of bureaucratic Communism in the East and the capitulations of
social democracy in the West have left many without the capacity to envision
any other course than the current race to the bottom.
Unfortunately,
Global Capitalism will not help to restore a vision of a democratic,
humane set of institutions not subordinated to capital’s demands. Hutton, at
least, mourns the passing of what he calls “stakeholder capitalism” where
executives recognized the existence of considerations other than maximizing
value for shareholders. But concrete structural reforms, which might empower
workers and stabilize communities, are totally absent.
Ultimately,
Giddens and Hutton seem to be writing about a wastebasket fire that can be
easily doused with a fire extinguisher rather than a raging inferno, which
threatens to engulf fundamental living standards, consume the environment, and
incinerate any meaningful concept of democracy on truly a global scale. Z
Roger Bybee works with the Wisconsin Fair Trade Campaign
