The Irish crisis: A complete failure of neo-liberalism

Éric Toussaint
International Viewpoint
January 2011

For a decade, Ireland was heralded by the most ardent partisans of neo-liberal capitalism as a model to be imitated. The Celtic Tiger had a higher growth rate than the European average. Tax rate on companies had been reduced to 12.5% and the rate actually paid by TNCs that had set up business there was between 3 and 4% - a CEO’s dream! Ireland’s budget deficit was nil in 2007, as was its unemployment rate in 2008. In this earthly paradise, everybody seemed to benefit. Workers had jobs (though often highly precarious), their families were busy consuming, benefiting as they were from the prevailing abundance, and both local and foreign capitalists were enjoying inordinate returns.


In October 2008, a couple of days before the Belgian government bailed out the big “Belgian” banks Fortis and Dexia with taxpayers’ money, Bruno Colmant, head of the Brussels stock exchange and professor of economics, published an op-ed in Le Soir, the French-language daily newspaper of record, stating that Belgium imperatively had to follow the Irish example and further deregulate its financial system. According to Colmant, Belgium needed to change the legal and institutional framework so as to become a platform for international capital, just like Ireland. A few short weeks later the Celtic Tiger was crying mercy.

In Ireland, financial deregulation had triggered a boom in loans to households (household indebtedness had reached 190% of GDP on the eve of the crisis), particularly in real estate, a factor that helped boost the island’s economy (the building industry, financial activities, etc.). The banking sector had experienced exponential growth with the establishment of many foreign companies and the increase in Irish banks’ assets. Real estate and stock market bubbles started forming. The total amount of stockmarket capitalizations, bond issues, and bank assets was fourteen times bigger than the country’s GDP.

What could not possibly happen in such a fairytale world then happened: in September-October 2008 the card castle collapsed and the real estate and financial bubbles burst. Companies closed down or left the country, unemployment rose from 0% in 2008 to 14% in early 2010. The number of families unable to repay their creditors swiftly increased too. The whole Irish banking system teetered on the edge of bankruptcy and a panic-stricken government blindly guaranteed bank deposits for EU480 billion (that is, about three times an Irish GDP of 168 billion). It nationalized the Allied Irish Bank, the main source of financing for real estate loans, with a transfusion of EU48.5 billion (about 30% of GDP).

Exports slowed down. State revenues declined. The budget deficit rose from 14% of GDP in 2009 to 32% in 2010 (more than half of this due to the massive support given to the banks: 46 billion in equity and 31 billion in purchases of toxic assets).

At the end of 2010 the European bail-out plan with IMF participation amounted to EU85 billion in loans (including 22.5 billion from the IMF) and it is already clear that it will not be enough. In exchange, a radical cure was enforced upon the Celtic Tiger in the form of a drastic austerity plan that heavily affects households’ purchasing power, with a resultant decrease in consumption, in public expenditure on welfare, in civil servants’ salaries, in infrastructure investments (to facilitate debt repayment), and in tax revenues. On the social level, the principal measures of the austerity plan are nothing short of disastrous:

• suppression of 24,750 positions in the civil service (8% of the workforce, which would mean 350,000 positions in France);


• newly recruited employees will earn 10% less;
• reduction of social transfers resulting in lower family and unemployment allowances, a significant reduction in the health budget, a freeze on retirement pensions;


• a rise in taxes, to be borne mostly by the majority of the population, already a victim of the crisis: notably a VAT increase from 21% to 23% in 2014; creation of a real estate tax (affecting half of the households that were formerly tax-exempt);
• a EU1 reduction in the minimum hourly wage (from EU8.65 to 7.65, or 11% less).
  

The rates for loans to Ireland are very high: 5.7% for the IMF loan and 6.05% for “EU” loans. These loans will be used to repay banks and other financial bodies that buy bonds on the Irish debt, borrowing money from the European Central Bank at a rate of 1% - another windfall for private financiers. According to AFP, IMF managing director Dominique Strauss-Kahn claimed that it would work, though of course “it would be difficult because it is hard for people who will have to make sacrifices for the sake of budget austerity”.

Both in the streets and in parliament, opposition has been very determined. The Dail, or lower house of parliament, voted the 85 billion rescue plan by a mere 81 to 75. Far from relinquishing its neo-liberal orientation, the IMF declared that among Ireland’s priorities it is counting on the adoption of reforms to do away with structural obstacles to business, so as to support competitiveness in the coming years. “Socialist” Dominique Strauss-Kahn said he was convinced that a new government after the elections in early 2011 would not change anything: “I’m confident that even if the opposition parties, Fine Gael and Labour, are criticizing the government and the programme [...], they understand the need to implement the programme.”

In short, the economic and financial liberalization aimed at attracting foreign investments and transnational financial companies has utterly failed. To add insult to the damage the population must bear as a result of such a policy, the IMF and the Irish government are persevering in the neo-liberal orientation of the past two decades and, under pressure from international finance, are subjecting the population to a structural adjustment programme similar to those imposed on Third World countries for the past three decades. Yet these decades should show what must not be done, and why it is high time to enforce a radically different logic that benefits people and not private money.

Translated by Christine Pagnoulle in collaboration with Judith Harris.

Eric Toussaint, president of CADTM Belgium (Committee for the Abolition of Third World Debt, www.cadtm.org ), has a PhD in political science from the University of Liège (Belgium) and the University of Paris VIII (France). He is the author of Bank of the South. An Alternative to the IMF-World Bank, VAK, Mumbai, India, 2007; The World Bank, A Critical Primer, Pluto Press, Between The Lines, David Philip, London-Toronto-Cape Town 2008; Your Money or Your Life, The Tyranny of Global Finance, Haymarket, Chicago, 2005.

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France: A beautiful Indian summer of social mobilization

First lessons of September-October 2010
Fred Borras
International Viewpoint December 2010

The preparation of the Woerth-Sarkozy [1] reform on pensions has generated one of the most important social mobilizations that this country has known, comparable to, if not more important than, those in November-December 1995 against the Juppe plan [2] and in spring 2003 against the Fillon reform [3], concerning pension systems. Although having as yet only a little hindsight, we can already draw some lessons from the movement…


Although he had not announced this reform at the time of his election campaign and had at that time confirmed that he would keep his commitment not to touch the legal retirement age, which was fixed at 60 years, Sarkozy made a volte-face. His bill, as adopted by Parliament, aims in particular at raising the age for retirement from 60 to 62, raising the age at which you can retire with a full pension from 65 to 67 and lengthening the duration of contributions necessary to obtain a full pension from 40 to 43 years.


To justify these radical choices, the government repeated a simple argument, that increased life expectancy would be likely to cause the bankruptcy of the French pension system. The avowed aim of saving the public pension system scarcely concealed the real one, which was to get rid of it.

The companies which want to generalize pension funds in France were not fooled. The group Malakoff Méderic, one of whose leading figures is the President’s brother, Guillaume Sarkozy, who is also one of the principal figures of the Medef [4] lobbied in favour of the reform and prepared to launch its products on a massive scale. Throughout the mobilization, tens of thousands of civil servants received mails from Préfon, an insurance organization which offers contracts for complementary pensions.

Social polarization
The public pension system in France is one of the branches of the Social Security system, whose creation, obtained after 1945, was the result of decades of social struggles. Based on solidarity, it is in the eyes of the bourgeoisie an archaism and a nonsense in a globalized capitalist world. From the point of view of the ruling classes, to destroy these remnants of solidarity is to release layers of profits which are “sleeping”. There is no doubt about it; this offensive on the sector of pensions is part of an overall plan which also threatens unemployment and sickness benefits. This is a global offensive against Social Security, whose benefits have already been reduced on several occasions. It is taking place in a context of economic crisis and is part of the austerity programme which aims at purging the system in order to restore the rates of profit.

To put an end to the “French exception”, i.e. to remodel the society of this country so as to align it with the rest of the developed capitalist world, to increase profits, that is the task that the bourgeoisie has set itself and which guides the policy of the government, which is entirely in the service of the bourgeoisie.

This reform could have gone through in the discreet silence of the salons of the Republic. The fact that it caused so much sound and fury constitutes a first victory for the partisans of the class struggle, among whom we count ourselves. It is also a first victory from the point of view of the need to make anger heard, to show the combativeness of those who refuse to pay for the crisis, all over the world. Clear about what was at stake, and yet without any guarantee concerning the possibility of forcing this right-wing government, which is “steady on its feet”, millions of workers and young people moved into action. Participation in the days of strikes and demonstrations became stronger and stronger, in spite of the government’s lies aimed at underestimating the numbers. According to the newspaper Le Monde, as a result of the turnover, 8 million people demonstrated at least once. That is quite simply colossal in a country of 65 million inhabitants. The rejection of the government project, thus expressed, was confirmed by many opinion polls. The duration of the movement was also rather exceptional, since after the scale of the first days of action in May and June, which was already surprising, the mobilization lasted even after the definitive adoption of the law.

To these many-millioned days of action was added an ongoing strike movement of hundreds of thousands of workers and young people in a certain number of sectors. It concerned ports, oil refineries, rail transport, the refuse collectors of big cities like Marseilles and Toulouse, the employees of certain local and regional authorities and tens of thousands of young people, in particular school students. The ongoing strike in these sectors was combined with the increasing number of blockades. Airports, stations, industrial and commercial zones and crossroads were in turn the target of determined demonstrators. It was a question of simultaneously raising the level of mobilization, supporting the sectors that were on strike and having an effect on the economy in order to inflict losses on employers. An unprecedented phenomenon on this scale from a qualitative and quantitative point of view, this type of action made it possible to bring down the barriers between militants of different trade-union organizations and to help foster unity between organizations and solidarity among workers and with young people.

The government made considerable efforts to defuse the discontent. Since its “pedagogy” had not been particularly effective, we saw crude operations like the aborted attempt to divert attention onto law-and-order issues or onto the Roms, who were massively stigmatized during the summer; we saw the government playing on the fear of violence by targeted repression and by invoking threats of terrorist attacks. Nothing worked. Nothing, except attrition.

The need for and difficulties of the general strike
Although the movement considerably complicated the task of the government and contributed to weakening and discrediting it, it could not prevent it from getting its reform through. That poses problems of a strategic order on which it is necessary to dwell.

Taking into account the scope of the attack and the level of determination of the government to impose it, it would have been necessary to strike much harder. Not to be satisfied with blocking this or that branch of industry but blocking the whole country. Only an ongoing general strike would have made that possible.

In spite of the conscious action of tens of thousands of workers and young people aimed at generalizing the mobilization it did not happen. Although the rejection of the government and its policies is obviously much stronger than in 1995, and although the days of action were more massive [5], the ongoing strike movement was weaker. There is not one single cause for this irrefutable fact. It is a mixture of closely related phenomena which explains it.

That relates first of all to a lack of confidence in the possibility of winning, of imposing the withdrawal of the bill. From this point of view, in certain sectors the weight of past defeats weighs negatively in the balance. Other important factors were the atomization of the working class, the extent of unemployment and precarious work, uncertainty about the future, the difficulty of “making ends meet”. It should be noted that the level of household debt is today 10 per cent higher than it was in 1995. To overcome this last factor, millions of workers must become convinced that the strike will hit their wallet less hard than the consequences of defeat, quite simply because they are convinced that victory is within their grasp.

It is also necessary to examine the attitude of the leaderships of the big trade-union confederations. Nationally, the Solidaires union [6] which defended the need for the general strike from start to finish, was isolated on this position. Not being of the same nature, neither the leadership of the main confederation, the CGT [7], nor even more so that of the second, the CFDT [8], are motivated by radicalism, the will to drive forward struggles to their maximum intensity, with the aim of inflicting, on the basis of a relationship of forces, defeats on the government. They are much more in the mould of “social dialogue”, negotiation, compromise. If unity could be forged and could last in spite of the differences between the leaderships, in spite of the effects of inter-bureaucratic competition, if the calls for mobilization were multiplied, it was above all the result of the attitude of the government, which at no point wanted to make any concessions. However it was not for lack of overtures, on the side of the Thibault-Chereque duo, who asked for the opening of negotiations, without ever demanding the withdrawal of the project. It is also because the pressure came from the base. The first tests of mobilization showed a high level of readiness for action and trade-union activists on the ground wanted to push further and harder, also being conscious that their credibility, their utility, their role, depended on it. Showing what was possible, local inter-union co-ordinating committees, for example in the departments of Puy-de- Dome, Haute-Garonne and Ardennes demonstrated greater combativeness, multiplying blockades involving workers from different sectors, adding departmental one-day strikes to those announced at a national level. These local one-day strikes were also successful, a sign that it was possible to go further.

The other weakness of the movement lies in the low level of self-organization of the struggles. Where the struggles were hardest, it was the inter-union co-ordinating committees in the workplaces which pushed the mobilizations forward and at same time kept control of their rhythms and forms. There was a generalized phenomenon: the weakness of participation in the general meetings held to decide to continue the strike or to organize the action contrasted with the massive character of participation in the one-day strikes and demonstrations. So it became impossible to get the struggle out of the cramped framework in which it was maintained, by the national inter-union coordination and in the different industries, sectors and workplaces, by teams of local trade union officials who were too timid.

It is nevertheless the case that the attractiveness of the trade unions was reinforced by this mobilization. That can be seen with the naked eye. Above all the CGT, but also Solidaires and the FSU [9] are recruiting. And that is positive. Teams of radical young trade-union militants have emerged and that is an asset for the future.

Unity and its limits
Over and above their function of defence of workers’ interests, it could also be seen that the population invested the trade unions with a political function of opposition to the government of the Right. That is logical when you see the crisis of credibility which affects the big institutional parties of the parliamentary opposition, and in the first place the Socialist Party. The SP sought to surf on the rejection of the Right in order to further its objective of a change of government in 2012 [10]. The principal leaders of the SP were present at the demonstrations, at the head of the contingent of their party. The fact that it was possible to constitute a broad front of the entire Left, political, trade-union and associative, against the Right, was a positive factor for the movement. But at the same time, the affair was difficult, so great is the proximity of the Socialists to the government on the fundamental issue. Sarkozy, Fillon and Woerth did not miss the opportunity to fustigate the duplicity of the SP, evoking the remarks of the current president of the IMF and potential socialist candidate at the future presidential election, Dominique Strauss -Kahn, in support of the reform. Nor did they have any difficulty underlining the contradictions of the SP whose principal leader, Martine Aubry, got herself in a pickle by approving the raising of the retirement age to 62 then backtracking. The PS has never demanded the withdrawal of the bill nor put forward measures for a really alternative programme, that is, one based on the sharing of wealth -and for good reason. As for the vote of the Socialist members of Parliament in favour of the provision of the law concerning the lengthening of the duration of contributions, it was a resounding admission. Some SP leaders pushed this logic to the end. In Marseilles, in the city which appeared as the “capital of the strike”, the principal leader of the local SP, Guerini, launched a joint appeal with the right-wing mayor, Gaudin, to stop the strike…

It is nonetheless the case that many militants and sympathizers of the SP took part in the movement. Like those of the other left parties, the Left Front [11], Lutte Ouvriere and the NPA. A unitary campaign of meetings, on the initiative of Attac and Copernic [12], made it possible to associate all these forces to distribute material with arguments against the law and to popularize alternative answers to the crisis to those of liberalism.

But differences also surfaced. While the generalization of the strike became the key question, the leaders of the Left Front, and above all Jean-Luc Mélenchon, conducted a battle for… the holding of a referendum. That does not only constitute an unattainable objective for various reasons, it also reveals fundamental differences with this anti-liberal and reformist current, which is regaining a certain influence in France. At the time of a full-scale political and social crisis, the leaders of the Left Front were seeking an institutional response. This way of approaching politics is based on a certain division of labour. The trade unions decide the calendar of mobilization. The parties find a political solution.

In the NPA, although we know that there exist differences of function between parties and trade unions and that these two types of organization have their specificities and their utility, we reject this mechanical and disjointed view of political action. What could be more political than the masses bursting onto the scene? What better solution than the majority of the population taking its destiny into its own hands? To affirm the need for the general strike is both to indicate the best way to win and to reinforce the political crisis, to allow it to crystallize, and solutions will appear with the overthrow of a government, with the defeat of its policies. When the opportunity to defend this solution finds the ear of hundreds of thousands of workers in struggle, then it must be done. That should not certainly be put forward in a timeless or dogmatic fashion, but it is the most reliable strategic road to revolutionizing society. It is a strategy which is verified and refined through experiences drawn from the analysis of the course of the class struggle. From this point of view, the strategy combines both the patient but constant preparation of the confrontation between the majority of the population and the privileged minority and the search for the expression, for the consolidation of majorities with ideas which are radically opposed to the very organization of the system and which prefigure the outlines of an alternative society. Without exaggerating the significance of it, the fact that a big majority of the population is ready to defend a system based on solidarity constitutes a political victory in the fifth capitalist power of the planet. Because although the government won on the institutional terrain, with the adoption of a law, although it inflicted a defeat on millions of workers who will suffer from its policies, it did not succeed in convincing. It lost on the terrain of public opinion. It lost on the idea that its policy is the only one possible, that it may not fill people with enthusiasm but that it is in the general interest. That is an invaluable gain in these times of crisis.

A discredited Right
The government of the Right comes out discredited, including in the eyes of workers who had believed in the promises of the candidate Sarkozy, who had been taken in by his electoral slogan, “work more to earn more”. In their eyes, Sarkozy is not any more the president of a better standard of living; he is the president of the rich. The Woerth-Bettencourt soap opera largely contributed to this discredit at the same time as it provided an additional reason to mobilize. While the Minister for Social Affairs was asking people to tighten their belts by an additional notch, he was demonstrating a sleazy proximity with the principal fortunes of the country. The image of corruption, of the vulgar display of wealth, of favouritism, is not very good for their standing in the opinion polls. Beyond that, it is Sarkozy himself who is the target, provoking a profound and virulent rejection. And the government reshuffle that he has just carried out changes nothing. That does not mean that his defeat in the 2012 elections is already certain. But the number of those who can no longer stomach him remaining in office has increased considerably.

A movement is also rich by its diversity. Among the demonstrators of this autumn, a certain number have decided to wait until 2012 to kick Sarkozy out, by replacing him by his Socialist challenger. But others understand well that the SP in power, with the example of what is happening in Greece, in the Spanish State and in Portugal, is another way of making the majority of the population pay for the crisis.

At the end of this movement, it is them that the NPA is addressing. In the midst of preparing its first national congress, it is working on a document which starts from the analysis of the double crisis, economic and ecological, of unparalleled scope, which the capitalist system is going through, to put forward transitional responses to this crisis. Its last National Political Council launched a call to discuss the anti-capitalist alternative. This debate does not relate only to organized political forces but also to those tens of thousands of workers and young people who are looking for an alternative to the policies of the Right and the institutional Left. To turn our backs on the Socialist sirens, on the dead end that an umpteenth version of governmental coalition with the PS would represent, is a necessity in order to open up another perspective. In this context, the NPA is working to develop frameworks of discussion that make it possible to confront different points of view as to the preparation of the next stages of the struggle and the outlines and content of an anti-capitalist alternative.

Toulouse, November 23, 2010

Fred Borras is a member of the Executive Committee of the New Anticapitalist Party (NPA) and a member of the Fourth International. He works as a teacher.

NOTES


[1] Eric Woerth was the minister of the Sarkozy-Fillon government who was in charge of piloting the project for the reform of pensions. Mixed up in financial scandals and profoundly unpopular, he lost his job in the government reshuffle which followed the mobilization.

[2] Alain Juppe was Prime Minister of the right-wing government, under President Jacques Chirac, in 1995

[3] Francois Fillon, currently Prime Minister, was Minister for Social Affairs in the Chirac-Raffarin government

[4] Medef is the French acronym for the Movement of Employers of France, the big employers ‘organization, whose president is Laurence Parisot.

[5] In 1995, the unions mobilized about two million demonstrators for the big days of action, compared with 3 million this time. Although lower on both occasions, the number of demonstrators according to the government estimates shows the same tendency.

[6] Solidaires (“In Solidarity”) is a minority trade-union organization, coming partly from expulsions from the CFDT at the end of the 1980s of radical trade-union militants who then set up the SUD trade unions, which became influential in certain sectors (Post Office, rail, tax offices…)

[7] The General Confederation of Labour (CGT) is the biggest trade-union organization in France (34 per cent of votes in the elections to the conciliation and arbitration boards in 2008). Led for a long time by the French Communist Party, its central apparatus became autonomous at the same time as the party was relegated to the second rank on the political scene. It has joined the European Confederation of Trade Unions (ETUC) and the International Trade-union Confederation (ITUC). Bernard Thibault, of the Federation of Railway Workers, has been general secretary since 1999.

[8] The Democratic French Confederation of Labour (CFDT), is the second-biggest trade-union organization in France (21.8 per cent of votes in 2008). It came from the radicalisation of the Catholic trade union movement (a majority split from the Catholic confederation, the CFTC, in 1964). Radical and committed to workers’ self-management in the 1960s and 1970s, it was ”re-centred” under the leadership of Edmond Maire after 1978 and expelled its radical currents from the Post and Telecommunications and Health sectors in 1988.

The CFDT supported, against those workers who were on strike, the reform of pensions in 1995, then again in 2003, which caused new departures of the radical currents of the confederation. Francois Chereque has been general secretary since 2002.

[9] Unitary Trade-union Federation (FSU), the main union of those working in education, research and culture.

[10] The next presidential and legislative elections in France will take place in 2012.

[11] The Left Front comprises in particular the French Communist Party and the Left Party. The latter was formed in 2008 from groups of militants who left the Socialist Party. Its main leader is the former senator and Socialist minister, and current MEP, Jean-Luc Mélenchon.

[12] Attac is an association for popular education whose aim is to combat liberalism and to popularise arguments against liberal policies and in favour of another distribution of wealth. Copernic is a foundation whose objectives are similar.

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France: Not victorious, but not defeated

By Murray Smith
Links International Journal of Socialist Renewal
December 8, 2010 -- Links International Journal of Socialist Renewal -- It is now possible to begin to draw a tentative balance sheet of the vast movement against the reform (or more exactly, counter-reform) of the pension system in France over the last few months. We need to look at the depth and breadth of the movement, the forms that it took and the positions adopted by its various components. And finally at what might be the repercussions and consequences.

The immediate aim of the reform proposed by President Nicolas Sarkozy and his government seemed quite clear. It was to raise the minimum retirement age from 60 to 62 and the age for retiring with a full pension from 65 to 67, with corresponding increases in the number of years of contribution required. But behind this immediate aim lies the ongoing objective of slowly undermining the public pension system, with the aim of pushing workers towards subscribing to private pension plans, to the greater profit of the pension funds.

Private funds have never been able to develop in France to the extent that they have elsewhere.

This is not the first pension reform: previous ones in 1993 and 2003 lengthened the periods of contribution for the private then the public sector, changed the method of calculating and indexed pensions on the evolution of prices rather than wages. Since 1993 the value of a pension has dropped by around 20 per cent. A million pensioners live below the poverty line and 50 per cent receive less than 1000 euros a month. (The minimum wage in France is currently 1337.70 euros a month.) Nor will this reform be the last. A further review of pensions will take place in 2013, conveniently after the next presidential elections.

Movement grows

The movement against the reform began as soon as it was clear that there was going to be one, even before the exact details were published. The first one-day strike was on March 23, 2010, followed by two others on May 27 and June 24. After the summer break the movement took off again and indeed intensified, with 2.5 million demonstrators in the streets on September 7, reaching its highest point in mid-October, with days of action that put up to 3.5 million people onto the streets. And since they were not all the same people, the newspaper Le Monde has calculated that up to 8 million people were involved in the mobilisations at some point.

The days of action were called by the Interysndicale, a coordinating committee of the French trade union confederations, all of which were represented on it, from the biggest to the smallest, from the most moderate to the most radical. The Intersyndicale continued to function throughout the eight months of the movement and had the undisputed authority to determine the timing of the big national days of action/one-day strikes.

This was not the first time that such an Intersyndicale had functioned. It was already the case, partially, in the movement over pension reform in 2003 (although the moderate Confédération française démocratique du travail – CFDT -- French Democratic Confederation of Labour pulled out early after an agreement with the government and the radical Solidaires federation was excluded) and again in the movement in 2006 that defeated the CPE (an attempt to introduce a cut-rate minimum wage for young workers entering the job market). Very significantly, given the nature of the movement in 2006, the Intersyndicale was broadened out to include the student and school student unions. The Intersyndicale functioned again in the one-day strikes against austerity at the beginning of 2009.

Trade unions’ role

The central role played by the trade unions is no accident. In the present period, they have a unique authority. Whatever may be thought of their errors, their failures, their weaknesses and their limits, individually and collectively, they are considered by millions of workers as instruments of defence. No political party has the ability to put millions of people into the streets. Not the Socialist Party, despite its electoral support, nor the forces to the left of the SP. This central role of the unions has something to do with the traditions of the French workers’ movement, but not only that. The unions played a central role during the general strikes of 1936 and 1968 and in many other movements, but behind the main union federation, the General Confederation of Labour (Confédération Générale du Travail, CGT), stood the French Communist Party (PCF), which was hegemonic in the working class. No party has such hegemony today.

It was the unity of the trade unions, which was not always the case in the past -- far from it -- that made possible a movement on this scale. None of them could have done it on their own. The CFDT in particular had a strong reason to stay on board. Its desertion of the movement in 2003 cost it many members, mainly to the benefit of the CGT and Solidaires. But the unity that made the movement possible inevitably imposed some limits on it. The Intersyndicale was never going to call a full-scale, ongoing general strike to defeat the reform. Not only the CFDT and the smaller moderate unions, but also the CGT (as was already shown clearly in 2003) were not ready for that. It would certainly have been the most effective weapon to defeat the government but the trade union leaderships as they are were never going to do it.

Only the Solidaires federation consistently defended such a line but it was very much in a minority. Over and above the question of the general strike, the Intersyndicale as a whole did not take a position of calling for the withdrawal of the reform; Intersyndicale’s main components proclaimed their willingness to negotiate, complaining of not being consulted.

Left parties’ response

Although the parties of the left could not themselves mobilise millions, they all supported the actions initiated by the Intersyndicale. For the Socialist Party this was done with not a few hesitations, qualifications and false notes. The official position of the SP was to defend the right to retire at 60 but to accept prolonging the years of contribution necessary for that to 41.5 years, which rather emptied it of its content. Dominique Strauss­-Kahn, president of the International Monetary Fund and a potential SP presidential candidate in 2012, distanced himself from the party’s opposition to raising the retirement age, as did other figures on the right of the party. Even the SP’s first secretary, Martine Aubry, had to do a quick about-turn after initially approving of raising the retirement age to 62.

The forces to the left of the SP took a position of outright refusal of the reform, crystallised from the beginning by a petition launched by ATTAC and the Fondation Copernic (a left-wing think tank) on April 7, 2010, and signed by individuals representing a spectrum of parties and associations. These included many representative trade unionists, intellectuals and representatives of all the parties to the left of the Socialist Party (PCF, Greens, New Anti-Capitalist Party, Left Party…). There were also a significant number of SP members, including some leading ones. Collectives established on the basis of this appeal played a role in explaining the reform and winning public support, especially in the early stages, and unitary meetings were held all over the country.
The depth and breadth of the movement were such that, inevitably, comparisons have been made with past movements. From the point of view of the extent of the movement and the numbers of people involved, this was the biggest movement since 1968. In 1995 the strike movement was much more powerful, spearheaded by the rail workers. But the movement was less broad.

Why no ongoing general strike?

But when you make the comparison with 1968, the question arises: why was there no ongoing general strike? Of course as we have seen the union leaderships were not ready to call one, but the two massive general strikes in 1936 and 1968 were not called by the union leaderships. They began in the workplaces and spread, only being taken in charge by the unions at national level later on. Why did that not happen this time?

There is no simple answer to that, but a large part of the reason lies in the changes that have taken place in the working class. Although there are still some large concentrations of workers and some strategic sectors where a strike can have a big impact (as was seen in the recent movement), the situation of the working class bears no comparison with 1968. Many of the big bastions of the working class and of the trade unions in heavy industry have gone, in France as elsewhere. Privatisations have been pushed through. Workers are much more atomised, work units are smaller, there are more non-unionised workplaces, there is more precarious work, there is unemployment and the threat of it, there is growing household indebtedness. This was reflected in the fact that many rank-and-file militants who, unlike the union leaderships, did want a general strike were sceptical about the possibility. Another factor was certainly the absence of a credible perspective of social change, which was there both in 1936 and in 1968. Socialism may not have been an immediate perspective but it was a long-term one for millions.

Rather than comparisons with 1968, it is more interesting to situate the 2010 movement in the chain of resistance to neoliberalism over the last fifteen years, marked on a national scale by the movements in 1995, 2003 and 2006, and last but not least by the European referendum campaign of 2005. If we look at the multiple facets and forms of struggle of the movement we will see that it draws on these experiences while developing them. In the first place, like previous movements, the movement had massive public support, which increased rather than diminished as it progressed, reaching over 70 per cent in the autumn. That was among the general public. Among workers it was higher. In September a CSA poll showed that 89 per cent of public sector workers and 76 per cent of workers in the private sector were opposed to pension reform.

The backbone of the movement was the series of one-day strikes and demonstrations that built up from 800,000 demonstrators in March to 3.5 million on October. But around that backbone many other things were happening. On each national day of action many workers not only marched but went on strike. Some sectors could be counted on to take strike action every time, rail workers and teachers among others. The decision to have some demonstrations on a Saturday, the first one on October 2, was not well received by many militants. But it made possible the participation of many workers, especially in the private sector, who supported the movement but were not ready to go on strike, in many cases because it would have cost them their job. On top of the national days of action there were many local initiatives in areas that were bastions of the movement, above all but not only, in the area around Marseilles. And at a local level, the militants were often well to the left of the national union leadership, and the call was not to renegotiate the reform but for it to be withdrawn.

High point of radicalisation

The movement reached its high point in the second half of October. Following a day of action on October 12 many sectors remained on strike, either continuously or in a rolling fashion, and this continued after the day of action on October 19. The focus was now on the most militant actions. Key sectors engaged in ongoing strikes. All the oil refineries in France were out, as were port workers and lorry drivers (who in France are largely wage earners rather than being self-employed). Some of these sectors had their own specific motives to strike -- plans for the privatisation of ports, danger of closure and delocalisation of refineries. Another key factor was the massive mobilisation in the movement of school students, who struck and blockaded their high schools, and to a lesser extent university students, though the universities were only just starting again after the holidays.

At this stage of the movement the strikes were accompanied by forms of direct action. The oil refineries were not just on strike but blockaded, as were the ports. Dozens of tankers blocked off Marseille. There were blockades of motorways (especially by the lorry drivers), railway lines and industrial zones. These actions were conducted by workers from different sectors and by students. Perhaps the most striking thing is that as the movement radicalised so did public support for it. Financial support for the strikers poured in.

At the height of the movement a poll taken on October 20-21 (Harris-Marianne) showed some remarkable results: 69 per cent approved of the strikes and demonstrations (92 per cent among those on the left); 52 per cent supported public transport strikes (77 per cent on the left); 46 per cent approved of blocking the refineries (70 per cent on the left, 57 per cent of manual workers). The combination of forms of struggle, from mass demonstrations to more militant strikes and direct action, not only gave the movement its breadth and depth. It also made it possible to escape from the “all or nothing” trap – either a general strike or demoralisation and demobilisation. The forms of action that appeared in this movement will be seen again.

`Not victorious, not defeated’

The movement was in the end not victorious. The government camped on its position, the law went through, the police broke the blockades of the refineries and imported oil from other countries. The movement began to lose impetus towards the end of October. But in the first place what happened was not inevitable. Even short of a full-scale general strike, a continuation of the movement at the level it had reached in mid-October could have made the economic and political price too high for the government to pay. And “not victorious” does not mean crushingly defeated. This was not Britain in 1985. Sarkozy may want to be France’s Thatcher but he certainly is not. This was a tactical defeat, which may turn out to have been a Pyrrhic victory for Sarkozy. It was not by any means the kind of defeat which demoralizes and deters people from fighting again.

The strength of the movement is an indication of profound dissatisfaction with Sarkozy and his government. It crystallised around the issue of pensions, about which people have strong feelings. They think, entirely reasonably, that they have a right to retire on a decent pension at an age when they can still enjoy their retirement. But there are also other factors at work. There is a widespread feeling that this is one neoliberal measure too far, that after this there will be others, and that it has to stop somewhere. There is a questioning of what sort of society this is leading to. This is true even among young people. Probably many of the school students who demonstrated did not understand the fine details of the law on pensions. But they know they will have difficulty finding any kind of decent job, they wonder why people will have to work until they are 67 when there is so much youth unemployment, and in a more diffuse way they wonder what kind of society they are growing up into. There is also a widespread feeling, in France as in other countries, that it is ordinary people, workers, the poor, young people, who are being made to pay for the crisis, while bankers and brokers continue to rake in the money.

There has been resistance to neoliberalism in other countries and at present popular resistance against austerity is spreading across Europe. But it is certainly in France that resistance has been greatest over a long period. There is a long history of popular revolt in France, combined with deep-seated attachment to equality, solidarity, the defence of the “general interest” against particular interests, which flows from the French Revolution. The proclaimed aim of Sarkozy when he came to power in 2007 was to put a stop to this “French exception” and get France up to speed with its European partners. The progress that he has made has been in the face of considerable opposition and remains fragile. To this should be added the perception of Sarkozy himself.

Under neoliberalism, governments have tended increasingly to act not only as guarantors of the capitalist order in general but as direct servants of the rich and in particular of the sphere of finance. But up until now no French president has so blatantly and shamelessly paraded his links with the rich as Sarkozy. Indeed a recent book about him is simply entitled The President of the Rich. No further explanation is required. It is symptomatic of the Sarkozy regime that the minister who steered the pension reform through (and was dropped in the subsequent government reshuffle), Eric Woerth, is himself up to his eyes in a scandal centred on France’s richest woman, Liliane de Bettencourt. Another example is the fact that Guillaume Sarkozy, elder brother of the president and a prominent businessperson, planned to cash in on the reform by launching a private pension fund on January 1, in partnership with public financial institutions that are ultimately controlled by his brother. The plan appears to have been stymied for the moment, but its existence, over and above the family connection, illustrates the close links between the Elysee Palace and business circles.

What now?

What is the situation now that the movement is effectively over? One striking feature of it was that in spite of massive rejection of Sarkozy there was no sign of a political alternative. The few calls that were made for a dissolution of parliament and new elections received little echo. That reflects the fact that at the moment the only alternative to Sarkozy and his Union for a Popular Movement (Union pour un Mouvement Populaire, UMP) party is the Socialist Party. People may vote for it as a lesser evil than Sarkozy, but in most cases without great enthusiasm. The fact that the SP candidate in the 2012 presidential elections could well be IMF president Dominique Strauss-Kahn speaks volumes about the absence of any alternative to neoliberalism from that quarter.

All the political forces in France are now positioning themselves for 2012. The recent government reshuffle, the re-appointment of Francois Fillon as prime minister, the departure of most of the centrist and ex-left ministers and the realignment of the government on the UMP is a sign that Sarkozy is battening down the hatches and trying to mobilise the core vote of the traditional right.

After being united in the movement over pension reform, how the left, specifically the forces to the left of the Socialist Party, prepares future electoral confrontations will be of great importance. On that level, things will become clearer over the next few months.

But many things can happen between now and 2012. A British prime minister once said that a week is a long time in politics. In the present international social and economic climate, particularly in Europe, the period that separates us from the 2012 elections are an eternity. What is certain is that the combativeness and inventiveness that were demonstrated in the movement will be reflected in many partial, local struggles. Indeed they already are.

Whether we see a new generalised movement depends on many things: what measures the government dares to take, what miscalculations it may make, what is forced on it by, for example, the crisis of the eurozone.

Outside the arena of social struggles, and apart from elections, other political initiatives are possible. During the movement, calls were made for a referendum on pensions, in particular by Left Party leader Jean-Luc Melenchon. The idea did not really take off, perhaps it was not the right moment to raise it in the heat of the struggle. But it seems to be gathering some support now, and it could be one way of keeping the issue of pensions alive. There is a precedent in the success of the unofficial, popular referendum against the privatisation of the Post Office in 2009.

Whatever the precise developments over the coming months, the forces that were brought into action over the last eight months will continue to manifest themselves, and the French working class will continue to be in the vanguard of resistance to neoliberalism and austerity in Europe.

[This is an updated version of Murray Smith’s article that first appeared in the Scottish socialist magazine Frontline. Murray Smith lives in Luxembourg and is a member of the anti-capitalist party Dei Lenk. He is a former leading member of the Scottish Socialist Party.]

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Remembering My Detention In Indonesia

Lisbeth Latham

Eleven years ago today I was arrested in Jakarta, by members of the POLDA Metro Jaya intelligence unit. At the time I was arrested I had been with some members of the Front Nasional Perjuangan Buruh Indonesia (Indonesian National Front for Labour Struggle – FNPBI) who were conducting a sit-in at the national parliament building.

This was the third protest involving the group of workers which I had attended. The first was outside the International Labour Organisation’s office in Jakarta, to call on the ILO to place pressure on the Indonesian government to enact legislation, consistent with ILO conventions, which would allow unions organised primarily on a geographical basis to registered, rather requiring unions to be based on an industry basis. The second protest was outside the clothing factory which the workers were employed to demand reinstatement after the owner sacked the workers for attending the protest. Final protest sought the reinstatement of the workers and a change in the national parliament.


Following my arrest, I was taken to the Metro Jaya headquarters along with Doming who had insisted he be able to accompany me. I was interrogated over the next 24-hours before being taken to an immigration detention centre. On December 5, I had two visits, the first was by staff from the Australian Embassy. They informed me that they had noticed the article which I’ve included below regarding my arrest and decided they should investigate my situation, the Embassy had been informed of my arrest two days earlier by FNPBI chairperson Dita Sari. The Embassy people told me they didn’t know exactly what was happening, but that there was a possibility that I would be charged with violating my visa – a charge which carried a five year prison sentence. I was informed that if that occurred it could be up to six months before the trial would run its course – they told me that I would have to arrange and pay for my own defence, but they had forgotten to bring the list of lawyers. I was informed that they hoped I would simply be deported on my ticket in two days time, but if not they would come and see me on the Monday morning. with the list of lawyers.

Later that day Mugianto from the Partai Rakyat Demokratik’s (Peoples Democratic Party – PRD) International Department came to visit with a lawyer, they had managed to get access to me for a short period of time. Mugi said that they hoped that I would be deported using my ticket on Sunday December 7, as if I did not fly on that date, there were no more seats on flights and I could be waiting for a month for a flight. Mugi also told me about the protests against the WTO in Seattle which had happened earlier in the week (because of my detention I never saw any of the footage from Seattle and would see footage in 2000 in the lead up to the S11 protests in Melbourne).

The next day I was visited by Roma, the FNPBI’s international officer who had just returned from the Seattle protests. Prior to going to Seattle, Roma had made me promise not to do anything stupid ... Roma had managed to get into the detention centre by convincing one the guards to let her in, largely on the basis that were both from North Sumatra.

On the Sunday I was eventually taken to the airport, about an hour before my flight. Prior to be taken I was convinced I would not be getting on the flight. I was deported from Indonesia and banned from returning for one year, however one of the officials indicated that I could expect to be detained if I returned within five years. I got back the day the final Green Left Weekly was printed, which contained the article below – It was a rather surreal experience to sell a paper with an article about me in prison.

Overall while the experience in Indonesia was extremely frightening, I knew I was in far less danger than my Indonesian comrades, many of whom had been kidnapped and tortured during the struggle. I have always attempted to use the bravery of the Indonesian student and worker movement to inspire my continued participation in continuing struggle for democracy and socialism.


Australian held for violating visa.
3 December 1999
Jakarta Post

JAKARTA (JP): Police intelligence officers are questioning an Australian national over his participation in a number of street protests here, city police spokesman Lt. Col. Zainuri Lubis said on Tuesday.
By participating in the rallies on labor and political issues, the suspect, identified as Christopher, violated existing immigration regulations, he said.
"Christopher came here on a tourist visa, but he was here to take part in street protests. He'll be charged under Article 50 of Law No. 9/1992 on immigration regulations," Zainuri said.
If found guilty of violating the article, the suspect could be deported and banned from the country for a year.
The latest rally Christopher took part in was last Tuesday's labor protest at the House of Representatives in Central Jakarta, the officer said.
The protest was organized by the Federation of All-Indonesian Workers Union of Reform.
"This is his second trip to Indonesia. His first was on April 6 this year," Zainuri said.
The suspect also was seen playing an active role in a number of other protests, including one organized by the Democratic People's Party (PRD) outside Cipinang Penitentiary in East Jakarta, an International Labor Organization protest at the United Nations building on Jl. Thamrin in Central Jakarta and a protest in front of the Presidential Palace on Jl. Medan Merdeka in Central Jakarta.
"His passport also states that his status is that of a student and that he belongs to a non-governmental organization in Australia called ASIET.
"He is currently under the supervision of the police's Foreigner Control unit. He will soon be transferred to the immigration office in Kalideres, West Jakarta, to be held in quarantine," Zainuri said.
The officer also said that any Indonesians who gave shelter to the suspect should immediately report to the police.


Australian solidarity activist jailed in Jakarta
By Max Lane
Green Left Weekly #388 December 8, 1999

Action in Solidarity with Indonesia and East Timor member Chris Latham was arrested in Jakarta on November 29. Latham, who is a student in Sydney, was participating in a demonstration of workers and students organised by the Indonesian National Front for Labour Struggles.
Latham was held and interrogated at Jakarta Central Police Station until December 2, when he was moved to the Immigration Detention Centre on the outskirts of Jakarta. He is imprisoned in a three-by-three-metre cell with two other people, one from Nigeria and one from South Africa.
Latham has not yet been told whether he is to be deported or brought to court in Indonesia. He has been visited by Australian embassy representatives and the People's Democratic Party (PRD) international department spokesperson, Mugianto.
According to Mugianto, Jakarta police are accusing Latham of repeatedly attending demonstrations in Indonesia, an activity which the police say contravenes the conditions of tourist visas. It appears that Latham has been under close surveillance during his stay — the police had detailed knowledge of his attendance at demonstrations.
Latham's arrest follows a raid by Indonesian intelligence officials on the Lampung office of the PRD the previous week. The officials said they were looking for Australian Democratic Socialist Party activist Roberto Jorquera, who was visiting Indonesia and meeting with student activists. Jorquera was not in Lampung at the time, but was later detained briefly at Denpasar airport in Bali as he left Indonesia.
The PRD protested against the raid and pointed out that Jorquera's visit to Indonesia was conducted openly and that the PRD activities he had attended in Lampung had been public events.

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Two-tier wage system & class struggle

Published in Workers World Nov 28, 2010 9:26 PM
New York Times economic analyst Louis Uchitelle’s articles usually appear in the business section. That his Nov. 20 feature wound up on page one means his editors found it especially important.

As with most Times’ articles, this one is slanted to discourage workers from struggling. A Marxist activist reading it, however, might conclude that working-class struggle in the United States is inevitable, a new union leadership is absolutely necessary, and this new leadership must refuse to accept private property and capitalism as permanent. They must instead embrace Marxism, the ideology of class struggle and the need for socialist revolution.


This is the only alternative to workers submitting to a life of grinding poverty.

Uchitelle examines the bosses’ strategy of imposing “two-tier” wages in the factories in the industrial region of southeastern Wisconsin. This is where the cities of Milwaukee, Racine, Kenosha and Brookfield are. It’s where 15 percent of the workforce still works in factories and are in unions. It’s also where most of Wisconsin’s African-American population lives.

Most factory workers until recently earned wages and benefits that could provide a family with a home, car, health care and retirement benefits, according to Uchitelle’s numbers.

Factory owners and managers — even at profitable factories — have decided to increase profits even if they must reduce sales. They are consciously cutting labor costs by reducing wages. They do this by hiring “casual workers” at lower wages and no benefits. They impose low wages on new hires.

The new wages are half to three-quarters the existing rate. This disrupts union solidarity, dividing the new and the experienced workers. These wages are too low to allow young women and men to set up a household similar to what their parents could. They create a situation of immediate frustration.

To bludgeon unions into accepting such bad contracts, the bosses threaten to shut the factory or move it, not to China, India or Mexico, but to areas of the U.S. where unions are weaker or nonexistent.

No doubt workers and youth in southwestern Wisconsin want to fight this development. But Uchitelle interviews the old-line union leadership. They became leaders when the workforce was overwhelmingly white and male, and when anti-Communist laws pushed revolutionaries out of the unions. They see capitalism as permanent, and they accept the ground rules of private property. With workers fearful of losing jobs under conditions of high unemployment, these union leaders have already given up the battle.

WW reporter Martha Grevatt has been writing for the last two years about such conditions already imposed on members of the United Auto Workers at Delphi plants and, under the terms of the 2009 government bailout, on workers at the big three car makers.

Uchitelle implies that capitalists all over the U.S. will adopt this strategy: Cut wages in half, starting with two-tier contracts, and make wage cuts and high unemployment permanent.

Such a strategy undermines the social stability in the U.S. working class that has existed for decades. Even if the decline in wages to near-poverty levels fails to provoke an explosion of struggle, it creates conditions where young workers have no choice but to re-examine the society they face. It is a society that stifles them at every turn.

Only by rejecting the primacy of profits can workers even begin to wage union struggles. Only by developing a leadership that includes more women and more people of color can they represent the most combative workers. Only by expanding beyond the plant can they enlist the forces of other oppressed groupings in the community. Only by going beyond their region can they unite with unorganized workers in parts of the country where the bosses threaten to move. Only by viewing the U.S. workers as a class can they envision a national strike. Only by embracing internationalism can they unite with immigrant workers and understand their common interests with workers around the world.

Only by accepting the goal of ending capitalism and replacing it with socialism can they walk the road to victory.

For a thorough examination of the ideas in this editorial, read the book “Low-Wage Capitalism” by Workers World contributing editor Fred Goldstein.


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Articles copyright 1995-2010 Workers World. Verbatim copying and distribution of this entire article is permitted in any medium without royalty provided this notice is preserved.

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Minneapolis Truckers Make History - Film on the 1934 Minneapolis Truckers Strikes

This film was produced by Labor Education Services at the University of Minnesota. Its based on an earlier documentary Labor's Turning Point. The video gives a good indication of the significance of the 1934 strike both in Minneapolis and more broadly in the US. There are a few facts and interpretations that I would quibble with, as it does play down both the level of strike breaking conducted by the Farmer Labor Party adminsitration, and also overstates in my opinion the signicance of both the National Recovery Act and the Wagner Act which established the National Labor Relations Board.

One positive is the inclusion of segments of interviews with Shaun "Jack" Maloney, who was a militant both in Local 574 at the time of the strike, and in the Communist League of America, the Trotskyist current which lead the strike, and built Local 574 and subsequently Local 544 into a leading force in the US labour movement until their removal from offce as consequence of convictions for subversion in 1941.

Maloney was imprisoned in 1938 for his involvement in a strike in Iowa.

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Inter-Union statement of 8 November

Inter-Union statement of 8 November
Joint Declaration of the trade unions CFDT, CGT, FSU, Solidaires, UNSA
Original in French is available here
After several weeks of mobilization and despite the measures taken by the government to try to support the idea that "the page on pensions" has turned, 1.2 million workers who demonstrated on November 6 in 243 cities against these pension reforms which are unfair and ineffective.


As everyone is aware that the pension law may be enacted in the coming days, it is not the time for resignation. The trade unions will continue to act to reduce inequality, to win recognition of the reality of the harshness of the proposed changes and win other alternatives for finance the PAYG system. They reaffirm their commitment to maintaining the statutory age of retirement at age 60 and age of the full rate at age 65.

They note that the economic and social situation remains very poor and particularly a concern for employees, pensioners, unemployed and youth who still face the hard consequences of the continuing crisis.

The trade unions believe that the exceptional level mobilisation over the past months has highlighted the glaring dissatisfaction of workers and posed their demands for improved employment, wages and working conditions, and end to inequality between women and men, along with increased tax and wealth-sharing. They decided to deepen their analysis and proposals on these issues in order to challenge the government and employers.

The unions decided to continue the united mobilisation by making November 23 a national day of mobilisation across sections in a range of forms. These actions must address the concerns of employees and ensure a large participation. They ask the territorial and sectoral organisations to specify the form of action (rallies, demonstrations, rallies, work stoppages ...).

Trade unions seek to ensure their success.

The unions now committed to participate actively in the European day of action on 15 December to oppose austerity plans that are multiplying in Europe.

The organizations will meet again November 29, 2010.

On November 8, 2010

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