Talk at the 25th Public Services International World Congress

I have often cooperated with the Public Services International; the international secretariat for Public Service Trade Unions worldwide. This talk tries to bring out the issues of globalisation as they relate to unions and citizens.

(Greetings and thanks)

At the time of the last PSI Congress in Harare in 1989 the Berlin Wall was crumbling. There was great hope in Europe and in the world, we would have a new world order, reduced levels of conflict, a peace dividend, and an era of prosperity. These hopes were naive. They took no account of the major shift of the 1980s, associated with the politics of Thatcher and Reagan, but actually much broader and exemplified by the policies of the World Bank and the IMF as well; The move towards the "Free Market", Competitive, privatised society. There is no longer a 'systems debate'.

I. Some Characteristics

- 'Free market': 'Free' sounds good but in fact means 'deregulated', with the fewest possible restrictions imposed by law or custom. Markets can do many things well and no one wants to haggle or have a philosophical argument every time s/he buys the newspaper or a loaf of bread. By allowing supply and demand to fix the price of goods markets can also correct wasteful practices (ex. of transporting vegetables around the FSU by plane because oil costs 25 cents a barrel). Price is the market's chief tool and its great regulator for providing goods and services - whether necessities or luxuries - to those who can pay for them.

Markets function because everyone must act in them as an individual; they are by definition exclusionary: If I buy X (with money my own market value has assigned me) you cannot share it unless I allow you to. It is not the business of markets to guarantee a basic, decent standard of living to all, including the very young and the very old; it is not their business to create full employment; much less to provide health care, education, culture, parks, clean environments, collective transport, etc. etc. What markets can do - allocate scarce goods according to purchasing power - they will do efficiently, but they cannot decide a society's priorities. Only debate and politics can do that.

- Competition is a polite word for war. Hobbes was the great philosopher of competition, in which every individual is pitted against every other in the State of Nature - this is why we need the State. Over the past decade competition has become the rule at every level. In order to gain and keep international markets, governments must be prepared to give business anything it wants; to sacrifice worker rights, social protection, and ecological standards. Like markets, competition can be healthy if it is not allowed to become the only rule of society; but carried to its present extremes it prevents cooperation and solidarity; it undermines links between individuals, countries, peoples; it encourages an 'every man for himself' mentality and disregards the rights of others. It encourages domination of winners over losers and discourages a culture of responsibility. No one is responsible when winning is the point, anything goes. (quote C. Bohlen on FSU).

- Privatisation: PSI needs no lecture on this subject; its affiliates have been the principle victims of this strategy and it has put resources into studying and fighting the phenomenon (cf. Brendan Martin's book; videos, conferences). Privatisation in the southern hemisphere has its origins in debt and the structural adjustment policies imposed on debtor countries by the IMF/World Bank. Although the World Bank paid rhetorical hommage to the State in its 1991 World Development Report, (cf Congress Documents, Part Two, "The Public Sector in the 1990s" p. 165) saying that 'the State forms the very core of development', this has not been followed up in practice. A press report from Ecuador just two weeks ago (23/7) says that 'the government has frozen the funds of the state-owned telecommunications company in order to weaken it and justify its subsequent privatisation, following the suggestions of the World Bank'.

The Bank recommends that the same 'weakening' strategy should be employed with the national petroleum company. Ecuador earns half its national income from crude oil exports ($1.2 billion), and the Bank says that the profits should be channelled towards the 'private sector'. Both of these companies are profitable, they are not being privatised because of bad management, indifferent workers or lack of efficiency. The government has passed a law which will lead to the privatisation of 160 public sector companies and reduce the number of state employees by 30 percent, from 400.000 to 280.000. This story has been repeated hundreds of times in the last decade as foreign, transnational capital (as well as that of local elites) has replaced public ownership.

In sum, globalisation and integration of the world economy. A third of world trade now takes place between affiliates of TNCs. These companies (about 35.000 of them) have now invested $1.700 billion outside their 'home' countries and account for about a quarter of world GDP. These companies create few jobs compared to their economic weight and are thought to employ only 3 percent of the world's economically active population. Policies of the international financial and trade institutions (Bank/Fund/GATT) have been geared to facilitating globalisation.

II. Some Consequences

What does the free-market, ultra-competitive, privatisation ideology imply for us all?

- Massive job losses, in both the public and private sectors. The latest UNDP Human Development Report shows that the trend everywhere in the world is growth without job-creation. Since 1975, as Gross Domestic Product has increased, employment has lagged way behind, sometimes by more than 100 percent. Projections for every region of the world - including Asia, Africa and Latin America - show this gap becoming much larger by the year 2000. (UNDP HDR 1993 pp.38ff).

There is enormous confusion about the purpose of a free market economy. Many people believe that its purpose is to provide jobs. On the contrary, the point is to provide a financial return - a profit - on capital, period. Jobs are a by-product.

- Exclusion on a vast scale. The deregulated economy can probably include 80 to 85 percent of the population in the OECD countries, some at quite low living standards. It is doubtful that more than a third of the population in the so-called developing world will be included. Worldwide, this means about a third of the world population in and two-thirds out. The Wall divided the world on East/West lines; the division of the New Economic Order divides is the included vs. the excluded, the two-track, dual society. The world economy is a pyramid with a transnational elite at the apex, a more or less secure middle class below and under them, the vast and growing underclass of people who are unimportant both as producers and as consumers and for which the system has absolutely no plans. This is a model of economic apartheid.

- Greater polarisation within and between countries: In the Reagan-Bush decade, 80 percent of Americans saw their family incomes reduced. The top 1 percent had gains of 50 percent. Gaps between elites and ordinary people will grow everywhere because deregulated markets are not 'level playing fields'; they favorise those who already have the most. The North-South gaps will become a chasm (from 2x1 in the 18th c. to about 60x1 today).

- Boomerang effects: (cf The Debt Boomerang, Susan George and colleagues, Transnational Institute, a project financed by FINNIDA): environment, drugs, further job losses, immigration/ racism / fundamentalism. Possibly epidemics, physical insecurity/terrorism, social and technological fragility of Northern systems.

III. Some Strategies for PSI Affiliates and Their Allies

- Fighting the ideological war: The dramatic shift to market ideology didn't just happen. Of course it was helped enormously by the end of state socialism in Eastern Europe, but it was also planned and orchestrated. Neo-conservative foundations and think-tanks have paid to get their people into universities, held conferences, created journals, maintained networks. If people are divided into three categories: those who make things happen, those who watch things happen and those who never knew what hit them; then too often in the past decade or so the right wing ideologues have been in the first; and the progressives in the last, category. It's not just because I'm a researcher and writer that I believe in the force of ideas - and creation and dissemination of both critical thought and alternatives is vital.

We cannot just stay on the defensive as one blow after another strikes us. This means investment everywhere in people who can make the case for labor, the public sector, solidarity etc. in the local press, radio, television; people who can talk back to the government, the Bank and the Fund; it means a serious research and media strategy, it means first understanding that winning a war means taking the offensive.

- Building alliances: Paradoxically, the great majority of people everywhere is hurt by unbridled free-market policies but the minority has managed to impose its will. Solidarity within the labour movement remains, of course, essential, but if trade unions try to fight this tide alone, they will lose. Environmentalists, churches, women's organisations and the broad range of development-oriented Non-Governmental Organisations are obvious candidates for alliances, both nationally and internationally. The trade union movement, and PSI in particular, is well suited to undertake cross-border work and the building of regional and international alliances. Coalitions and tactical alliances do not mean that partners must adopt the full range of views and goals of the others; they do not require giving up one's own identity and will ultimately strengthen it.

- Democracy can no longer be restricted to the national level: For the past hundred years and more, trade unions have been in the forefront of struggles for economic and social benefits and democratic freedoms at the national level. Now this struggle has to be waged at both the national and the international level. Transnational corporations and completely unaccountable bodies like the GATT, the Bank and the IMF are taking decisions every date which which routinely hit public sector workers harder than others.

A major task is to democratise these international financial institutions, to make them answerable to citizens. They all have Executive Boards whose Directors represent individual countries (the rich ones) or groups of countries. These Directors can and must be lobbied. Trade unions in the South should insist on being included in the design of structural adjustment programmes and of Bank projects. Invest in the Bank/Fund telephone directories - these are public documents - and learn how to use them!

- Remembering our past to save our future: The people who came before us - including all those who founded and nurtured the trade union movement - gave their time, their spirit and sometimes their lives to the struggle for justice. In this time of crisis of accountability and democracy, we can also look to the past for inspiration. In 1789, the first Declaration of the Rights and Man and the Citizen proclaimed that "All public officials are accountable to society for their administration". Let us make that Article a modern right as well.

Some Conclusions

Just because societies have economies does not mean that they are economies, nothing more. Applying the 'market solution' to every problem is to take the lazy way out. Wherever markets are unrestrained by law or custom and allowed to make most of the decisions, they will naturally define the social and political priorities as well. The overlap of economy and society will become more and more nearly perfect until, in the 'perfect' market economy (which is impossible), the economy and the society would become one and the same.

Just as the market cannot cannot be expected to choose the greatest good for the greatest number, so it cannot be expected to look to the future. It is not worried about our children, the problems we will leave for them to solve and the mess we will leave them to clean up, if it still can be cleaned up. The market isn't worried about the state of the planet - the notion of 'price' tells us nothing we need to know about our ecological condition. (Quote Larry Summers: "There are no limits to the carrying capacity of the earth...").

We can take the line of least resistance, the lazy way, and let the free market, competition and privatisation define how we live together in society. Or we can commit ourselves to debate, coalition building, democratic politics and struggle. The second way demands much more time, energy and fighting spirit but it's one or the other because there are only two ways now to organise our collective lives - the lazy way and the democratic one.

Ideas like stewardship of the earth and concern for future generations and the environment; ideas like solidarity, care for the poor and the weak; ideas like justice and community; in fact the very notion of PUBLIC SERVICES are not economic but moral and political ideas. These ideas belong to a long and proud tradition of which everyone in this hall is a direct descendant. By the very fact of your work, your lives are dedicated to maintaining and improving the quality of our lives not just as individuals but as members of communities and citizens of countries. Your lives as trade unionists are dedicated to preserving the ideals of unity, solidarity and greater equality.

Although the adversary seems triumphant as we approach the end of the millennium, history teaches us that the minority cannot prevail forever against the majority. These are times to remember and to honour the great silent army of men and women standing behind us, who lived and fought and died for the rights we now enjoy. They too lived in times when their enemies often seemed invincible and their defeats outnumbered their victories. Yet here we are, men and women of dozens of nationalities and of different colours, meeting publically, peacefully and without hindrance in this hall, in this free country; members of a vibrant movement determined to defend and to enhance the vitality of the public sector
and the rights and dignity of public sector workers; sharing not only concrete plans for action but dreams for the future. I am confident that all of you here and your millions of brothers and sisters in the PSI family everywhere will show the same bravery and determination in the battles of the late 20th and the 21st centuries and I am proud to have been asked to address this Congress.

Thank you.