People's Democracy

(Weekly Organ of the Communist Party of India (Marxist)


No. 27

July 05, 2009



Capital Makes Desperate Bid To Salvage Situation


Ardhendu Dakshi


HELD in Geneva from June 3 to 19, the 98th International Labour Conference (ILC) was certainly not an earthshaking event. However, the fact remains that it took place in a year when the world capitalism has been shaken to its roots and the world opinion is raging against the hardcore promoters of free market economy and neo-liberal globalisation, who have landed the world economy into a disastrous situation. It is not difficult to imagine what the world leaders of capitalism would do in such a situation. In the face of such a devastating collapse of the global economy, they have stopped mouthing the slogans that they propagated in the last 30 years since the Reagan-Thatcher days, like �the government has no business to run business,� �there is no alternative� to capitalism and free market economy, �the government is a problem, not a solution� and �the market can cure all problems.� Paid agents of capitalism sang praises of the so-called globalisation to make the people believe that it was indeed the ultimate way for the progress of the society.




Yet, there was no answer to the blunt question that Lula Da Silva asked in the plenary session on June 15: �When the American banks, the German banks failed, why didn�t they go to the market? Why did they go to the state, to the government?� Lula also ridiculed the IMF and World Bank, asking that while they had had plenty of solutions for the economic problems facing the poor countries in the 1980s and 1990s, what their solutions were for the economies of the United States, Japan and Europe. Not surprisingly, the huge hall holding the plenary exploded into wild applause, expressing the anger against the market fundamentalists who have held the world economy and politics to ransom for nearly two decades.

The magnitude of this anger was such that several panelists went to the extent of calling the American bankers as �gangsters,� and received applauses. So much so that Nicolas Sarkozy, the president of France, indirectly attacked the American dominance and also the Fund-Bank duo. He said: �If the international organisations are going to be giving lessons, then they must be able to apply them to themselves.� Before those representing the world opinion, the US stood guilty while most of Latin America and Europe went on castigating the US for the present crisis.

This was a big and visible departure from the earlier ILCs where it was a crime to speak against globalisation and the neo-liberal economics. While market was considered to be the god, working class was subjected to the worst kind of exploitation and deprivation and even the ILO was promoting globalisation, giving an ideological boost to neo-liberalism. However, at one point of time, even the ILO was literally an orphan and put under the World Bank�s eyes. The rulers of the world said the ILO was irrelevant in the new paradigm and tripartite consultations were meaningless as the markets would take care of wages, service conditions and all other labour matters. Their diktat also made labour departments in most of the countries practically defunct.

But, what a big change now! The ILO has been put on a high pedestal, as the saviour of the situation. The G-20 meeting asked it to address the labour problems, ease the unemployment situation, and find ways and means to reduce the workers� suffering. Many of the leaders even suggested that the ILO must be invited to the G-20 meeting next month. Sarkozy was blunt and ebullient about the ILO. He said:

�I would also propose another revolution in global governance to ensure that the standards existing in international agreements be effectively applied. What would be the point of having standards in the ILO if they are not mandatory? A standard which is not mandatory is not a standard; it is a recommendation, a mere piece of advice; it is a piece of paper that can be blown away in the wind�...

�The revolution I am urging all of us to embark upon is based on the idea that the specialised agencies can participate in international disputes�. Let us create this new global governance so that the ILO can make its voice heard in the WTO, the IMF and the World Bank, as soon as the fundamental standards are threatened�...

�The international community cannot be schizophrenic�. but it is pure schizophrenia when the WTO and Bretton Woods institutions ignore what ILO is speaking.�

This desperate attempt to distance himself from what the leaders of world capitalism have done in the last two decades had had a clear motive --- to make the globalisation survive. Hence, to Sarkozy, regulating globalisation is the central issue as the world cannot be governed by the market laws of supply and demand alone, i e by �the law of the jungle.�




In an unprecedented way, this time the ILO�s governing body changed the agenda virtually at the last moment and brought the issue of economic crisis in, in a broad-based �Committee of the Whole on Crisis Responses,� or COW in short. Such a committee was unprecedented and the number of participants was by far the largest. From the workers group, there were more than 200 members, with similar numbers from employers and governments. From India, Ardhendu Dakshi (CITU), Thampan Thomas (HMS) and Uday Patwardhan (BMS) were members of this committee which met almost everyday. It had had eleven panel discussions with economists, sociologists, ambassadors, experts, political leaders, Fund-Bank officials, and professors from all regions and diverse institutions.

In short, the entire session witnessed unprecedented bashing of the World Bank and IMF, and denigration of neo-liberal, uncontrolled and unregulated globalisation. The culprits who caused the present crisis were obviously not present there and nobody wanted to defend them either.

Suddenly, after many years, the ILO has discovered that workers must be put at the centre stage. The World Bank has also changed its tune. Its representatives talked of distribution of income, delivery mechanism, social security net and coordinated action with the ILO. All these developments are new, and were obviously triggered by massive job losses, income depression and rising unemployment that are leading to an explosive situation in many countries.

Thus, the situation is desperate for the world leaders. They are working on many fronts to quell the anger of the people. On the one hand, through the media, they are announcing that green shoots of recovery have been seen; they are asking the people to have patience and wait for the shoots to grow and bear fruit in the form of income and jobs. On the other hand, they have commissioned the ILO to restore confidence and hope among the workers, with a show of prompt and vigorous action.

The ILO, on its part, has done what they expect it to do. It has created a document titled Recovering from Crisis: A Global Jobs Pact. There are plenty of good words and high hopes that the world �should look different after this crisis,� and there is the caution that employment �has usually only recovered several years after economic recovery.� The �great� assurance is, thus, that jobs will be coming sure but after the economy has recovered, i e after capital has restored its position.

But the question is: What about the conventions on minimum wage, right of association, right to collective bargaining, gender equality, environment protection etc? Going by the records of their ratification and implementation, will not the Jobs Pact document find a safe place in office shelves at the best?




On this issue, those in the workers group repeatedly raised queries about where the money to support the jobless workers is. When the banks fail, they get financial support or bailouts; when exporters suffer losses, they get government incentives or compensations, but what about the workers who lose jobs? There was no answer and no commitment either from the governments or from employers. There was also a related question: When workers did not get their dues and rights even during the boom time, what can they expect and from whom when the economy is in a deep crisis?

The workers� representatives pressed hard for a commitment for implementation of pro-worker provisions in the pact and some instruments to enforce its compliance in an extraordinary situation when economic crisis is leading to a social turmoil. Again, there was no answer. Nor was there any response to the demand of a legal structure to support the workers, like imposing a ban on retrenchment as has been done in Argentina and elsewhere.

Thus the so-called Jobs Pact goes without any financial support, any legal structure and any guarantee for enforcement of special pro-worker measures in a special situation. There must, therefore, remain no illusion about the Jobs Pact. The governments would ignore it because it is not an international agreement, while employers in their board meetings would go on taking decisions that make an �economic� sense. They want profits; they are not there for charity to the workers.

The workers will remain where they are now.

There is something interesting to know for the Indian people. India does not enjoy a prominent position in the ILO, but this time there were a number of references to India, to the NREGA. It is another thing that the government of India had refused to pass the act for a long time and passed it finally under pressure from the Left. The Jobs Pact document, whose creators did not know the hard realities here in India, appreciated such employment guarantee schemes.

China got the maximum applause because of its support for real economy and steps to increase the domestic demand and consumption.

The ILO conference took up two more subjects for discussion, namely, gender equality at the heart of decent work, and HIV/AIDS and the world of work. As usual, the report on gender equality ended with the great hope that the recommendations would be implemented, and said there should be regular monitoring of the progress. But, haven�t such pious hopes been expressed several times in the last 20 years, with little change in the situation? Now, in the crisis situation, things have gone worse for women who were in most cases the first to lose their jobs. As for the HIV/AIDS problem, the conference promised, in the end, to include this matter in the agenda of the next ordinary session with a view to adopting a recommendation.

While the conference was on, there were news of more job losses, more strikes, riot-like situations in a few places of the world despite the stimulus packages and assurances that are galore.

One has to admire the skills of the people who manage the ILO. The same people who vociferously pleaded for globalisation, free market economy and deregulation till the other day have swiftly changed their style and tack. At the ILC, they were eloquent about support to workers, about state intervention sprinkled with socialist slogans. They have to do it because they are desperate to salvage the situation --- to save capitalism.