On Class Composition and Recomposition in the Globalisation of Capital

We are publishing here a text from Prometeo 6, VIth series, December 2002. This discusses the effects of changes in the structure of capitalism on the structure of the working class and the political consequences of these effects. In particular, it reviews the predictions of a text written ten years ago, the translation of which appeared in Internationalist Communist Review no. 12 (the central organ of the International Bureau for the Revolutionary Party, now called Internationalist Communist), under the title “Where is the working class?”.

Trying to reply to the question as to why the proletariat up until now has not given significant signs of responding to the present crisis, except in a few great, but sporadic, episodes of class struggle, is certainly not a simple task. Instead, it is an enormous problem, and, in many ways it is the problem that revolutionaries need to solve. We have to get as close as possible to this solution to be effectively and efficiently equipped in a practical sense for concrete action. Not least, we have to be armed against the mortal miasma of exhaustion, the sense of impotence, the consequent turning in on ourselves and the presumed discovery of (non-existent) shortcuts which spring non-stop from the immobile marsh in which proletarian struggle has temporarily become mired.

Of course, it is a problem which must be conceptualised within a global framework, because capitalism - not just recently - is the dominant mode of production on a world scale; rather, the profound changes which have intervened in the twenty years up until now, which are commonly and erroneously called globalisation, have further tightened the grip of capitalism on the life of the planet. Worse still, in its insatiable desire for profit, capitalism is putting, or already has, its hands on the essentials of every mode of existence and is transforming them into commodities, and so reanimating its exhausted rate of profit. This doesn’t mean that we have suddenly become converted to the futile and inconsistent theory of a so-called “immaterial” capitalism, in which labour, or, more clearly expressed, the exploitation of labour-power, no longer sustains all the structure of bourgeois society because today it is up to “immaterial” labour, “communication”, and so on in a deluded fashion, to produce wealth. On the contrary, if everything is tending to become a commodity, exchange value, this doesn’t actually mean that any commodity whatsoever can create value (which is not the exactly same thing as money); it is a commonplace, that their appropriation might make a few filthy rich, but this does not create wealth: it solely re-divides it in a massively unequal fashion. It is precisely because the exploitation of the unique commodity that does create wealth, labour-power, has difficulties in adequately remunerating invested capital that capitalism has entered a profound crisis, causing the collapse of regimes which appeared as if they would never fall, unleashing speculation without restraint, throwing entire continents into despair, bringing, in fact, a global attack on the world proletariat’s conditions of existence. This genuine war on the proletariat has decomposed it, mixed it up and changed its surface characteristics, making it, in some ways, in the “metropoles”, a little less recognisable, although much less so than the vulgar scribblers of the bourgeoisie would have us believe. It is, in order to understand the proletarian silence, from here that we must proceed, from the profound transformations that the proletariat has undergone since, in the ’60’s of the last century, the crisis of the accumulation of capital began to manifest itself. It is therefore a question of resuming and making the first assessments of a work from ten years ago1, relating to Italy in particular, but exemplifying a more general tendency.

The workplace

What were the first conclusions we reached in our analysis of the processes underway concerning the decomposition and recomposition of the working class? In outline, the introduction of the microprocessor opened the road to the disappearance of, or the great reduction of, large concentrations of workers, to their fragmentation and territorial dispersion, to the vanishing and consequent redefinition of many occupations:

The first overall result is the material and subjective disaggregation of the proletariat, its temporary annihilation. (2)

Since then, as they say, much water has passed under the bridge, but the river hasn’t dried up, but rather the contrary. Ten years ago things were practically just starting, today, after the acceleration undergone in this decade, they show the definite outlines of our framework. This is also true with respect to the way in which the bourgeoisie has succeeded in containing - if not preventing - the workers’ response within the limits of what is compatible with its reign, thanks, not least, to the irreplaceable aid of the unions and “left” parties, in Italy as in Great Britain, in Germany as in the United States: we will never be able to sufficiently emphasise the fundamental role of the false defenders of workers’ interests in allowing the bosses’ blows to strike the workers...

One of the first elements to emerge was indeed the unceasing progressive dismantling of the large concentrations of workers, but, at the same time, there has been massive recourse, in waves across the metropoles, to so-called social shock-absorbers, which, being financed by the state, smear the costs of capital’s restructuring across all waged labour. To give an idea of the importance of the above-mentioned social shock-absorbers, it is enough to recall that in Italy, in the ’80’s alone, there were 350 000 early retirements, (3) without mentioning the direct and indirect financing of projects “for the development of employment”, the principal example of which was the FIAT establishment at Melfi.

The slow but constant erosion of employment in large factories, which still continues, was (and is) accompanied by the parallel intrusion of flexibility, that is, of a “new” organisation of work, under the sign of a deluge of insecurity and the arbitrary power of the bosses. If this “new” labour organisation has scaled down the Fordist type of production in the central countries - but without continuing to pay higher wages - it has, however, deepened and, in many ways, generalised the “Taylorist model”, pushing it into those types of work, like the public sector, which regarded themselves immune to it.

The intensification and increase in the relentlessness of work and flexibility in ever more massive doses, should prove remunerative for both industrial profit and the growing financial income, which is growing because the abnormal expansion of financial speculation is one of the more “traditional” manifestations of capitalist crisis.

The sharpening of competition on an international level and the uncertainty which rules sovereign over markets, with brusque highs and lows which are difficult to foresee, and makes the forecasts of the organs like the OECD or IMF “governing” the national and international economy appear ridiculous, cause every capitalist to try and strictly link wages and the amount of labour power used to the needs of his company or, in other words, to the falling rate of profit. It is a question of a phenomenon which we have appreciated for some time - see, for example, our Congress Theses of 1997 (4) - and confirmed by the more honest sociologists, even if they are declared reformists:

It is absolutely necessary for contemporary enterprises, in order to survive international competition, to vary their direct and indirect costs in a strict relation to the changes in their markets. This means that each has the possibility of employing exactly the quantity of paid labour power which is necessary for the production of a certain good or service in a given period of time: no more and no less. (5)

In consequence, as everyone can see, there has been a veritable explosion of so-called atypical forms of work which have, with time, developed from being of secondary importance in the spectrum of the labour market to being absolutely central. The fantasy of the bosses, of the rulers and of the unions trailing in their wake has not and will not recognise any limits in the invention of types of workers who totally conform to the needs of the companies: from temporary fixed-term work to week-end contracts, from on-call jobs to apprenticeships.... They are types of contracts which, even when they do not make provisions for lower than “normal” wages, nevertheless make savings for the company in its overall wage payments, while, just because of the discontinuous and intermittent character of the employment, they reduce the global revenue of the occupied labour power. This is without mentioning the diffusion of self-employed and falsely autonomous work, whose conditions are worse in many cases, both in terms of wages and of the “enjoyment of rights”, than even the more unrestrained forms of precariousness of officially employed labour.

Alongside the insecurity institutionalised and blessed by the so-called social parties, another phenomenon which is growing rapidly is the making work informal, in the speech of bourgeois sociology and the United Nations organs, that is, “black work”. This is hidden, outside of any regulation, even of the purely formal sort. In all cases, precarious or “autonomous” work replaces “fixed”, regular jobs with decisively higher wages.

It is not to be believed though, that increasing informality and insecurity only affects Italy, the European champion of black and hidden work (especially in the South, naturally): it is a phenomenon which strikes all the “metropoles” and does not even spare highly qualified sectors. Looking at the United States, even in this field in the vanguard, one sees that,

especially in high tech sectors, many companies have recourse to ‘non-normal’ relations of work, the so-called permanent temporaries. In 1986 their number was 800 000, while in 1997 they had reached 2.5 million, the equivalent of 2% of workers. Estimates confirm that these permanent temporaries represent about 10% of the employees in a fifth of the high tech companies (like Microsoft and AT&T). (6)

Things are not much better in the homeland of the social state, Germany, where

between 1980 and 1995 the proportion of ‘normally’ employed workers fell from 80% to around 68%”; one of the consequences of this is that “In the course of ten years the number of so-called underemployed has shot up from 2.8 to 5.6 million - as a result of that - where the carrying out of ‘joblets’ without social contributions has become the norm, the old system of social provision is collapsing. (7)

It is just because of this that the then Minister for the Family under Schröder condemned - in a humanitarian spirit, obviously... - the immorality, the “disloyalty” of the new Berlin proletariat, on whom the Minister wanted to impose the payment of social contributions.

Look at the chaos. Working in the black economy, shrinking wages and quasi-employed labour are very common in Berlin. Despite having jobs, people are abandoning social provision... (8)

To this we should add - another aspect already grasped by the cited 1993 analysis - the phenomenon of fragmentation of the working class in the same workplace and its distribution across several companies. As is well-known, the company, by ceding tasks to other firms, also cedes its workers, who, however, continue to carry out identical work exactly as they did before, but with a different uniform and a different contract, to the extent that in the same factory (for example, FIAT) there could be more than ten companies working at the same time. An example which at the time was reported by a few newspapers was (or is) represented by the naval dockyards of Mestre-Marghera, where numerous subcontractors were making immigrant workers from South-East Europe work much more than eight hours a day, for six or seven days a week and for “Rumanian” wages, meaning wages well below those of their Italian comrades who were working alongside. Whether it is called tertiarisation, out-sourcing, cooperative working (9), the end result is that the working class finds itself further divided and crossed by artificial juridical and bureaucratic barriers and, consequently, weakened in the face of capital. Summing up what has been said so far, employed wage labour has not in fact disappeared, as the “eminent” ideologues of the bourgeoisie wore themselves out prognosticating a quarter of a century ago, when the great restructuring of industry had hardly begun: it has just changed its appearance. And it is a confused, suffering and intimidated appearance, because, according to what D’Alema, as president of the council foresees, it is learning, at its own expense, to break from fixed jobs, to be exposed to the permanent blackmail of unemployment in the workplace, it is constrained to daily take account of what is no longer an anomaly or an accident, facing present and, even more so, future uncertainty.

Wages

If, from the point of view of employment the proletariat has cause to weep, the course followed by wages gives very little to laugh about. And the highest levels of the bourgeoisie have confirmed this, when, for once, they are constrained to put aside charlatan’s clothes and tell (at least in part) the truth. In fact, according to the Banca d’Italia, from 1980 to 1999

the proportion of the gross income distributed represented by wages fell from 56% to 40% [...] Net monthly pay diminished by 8.7% and low-paid workers increased by 10%. (10)

There are those who say that, however, the fall in wages has been much more marked, and is more like 15-20%; but, beyond the numbers (which still matter), there remains the background data of this general tendency of a decline in wages (11) and of a growth in the sectors of workers situated on the bottom rules of the ladder of “income from work”. As we have already had cause to emphasise (12), it is a phenomenon which strikes all the “West”, and which is more evident and brutal in the heart of the capitalist metropoles, the United States.

Despite the American proletariat always being almost ignored by the newspapers, the cinema and television (as well as by the hagiographies of the “left”), sometimes something seeps out of their world, and, if it is true that the most advanced nation shows the way (in the widest sense, obviously) for the others, the European proletariat has just begun to taste the “joys” of capitalism in its “globalised” version. T oday, like 80 years ago,

the majority of the workers, about 60%, earn less than 14 dollars an hour, which is what an adult with two dependent children needs to get by “normally”, so that a good 67% of adults who resort to the ‘banks’ to avoid starving [a re] people who have a job. (13)

A heavy pressure for the lowering of wages - which, in the immense archipelago of services vary from $6 to $10 an hour - recently arrived under the Clinton administration, which, carrying out and intensifying the dismantling of welfare, forced a large number of the poor to accept wages literally at starvation levels, in conditions of work which are generally very bad. (14)

It is the passage from welfare to so-called workfare; in practice, while the cover of the “social state” is progressively reduced, what remains of it must be subordinated to the acceptance of whatever work is offered: those who refuse the first job offered (even if this is far from home, underpaid or in a sector which has nothing to do with their specific abilities or professional training), lose the right to unemployment benefit or assistance. As for the claimed modernity, this recapitulates the poor laws of Elizabeth I of England (at the end of the 16th century)...

The very structure of wages, over the last few years, has gradually changed, becoming more “flexible” in adjusting itself to the rhythm of the enterprise, exactly as has the organisation of work (as we have already seen). If

the fullness of the order-book, the decisions on investment, the managerial strategy change from one year to the next, from one quarter to the next, from one week to the next, (15)

then, wages too must follow their course. For this reason, national contracts, accused of being excessively “rigid”, are progressively losing their central role in favour of regional, company or even individual ones. Company benefits, wages linked to productivity, a bonus distributed according to “professionalism”, as well as having the no small advantage (for the boss) of being revocable at discretion, are usually (especially in public service) not “pensionable”, or rather they do not enter into the calculations for redundancy (in the case of liquidation) or those for pensions... and this is without taking into account that company contracts only refer to a minority of the workers, in the overwhelming majority employed in small or very small firms, where the more direct contact with the boss inhibits (psychologically as well) and slows down working class initiative. But we will let someone who agrees with these things speak, since, as a trade unionist (of the left!) he actively contributed to the modification - for the worse, for the workers - of the wage structure. According to O. Squassina, the Secretary of the FIOM (16) in Brescia:

the collectively contracted part of wages is ever smaller in relation to total pay, and the part individually agreed or conceded by the enterprise is beginning to significantly contribute to wages envelopes.

Perhaps the growing weight of the wages agreed on the level of the company (in their various guises) has compensated for the small role of those resulting from national agreements? We can only smile at Squassina’s words, although they are pronounced in the usual “unionese”, which is studied just to attenuate and deform the true consequences of union policies:

the weakening underway of union action deriving from the national contract and [...] the rules fixed in the 1993 Accord are not up to protecting and improving wages for all workers - but, in addition - the experience in company negotiations over variable wages has been disappointing and therefore is being reviewed. (17)

For the moment, those who have to review something are the workers, who are constrained to progressively change their way of life, if, again according to Squassina, they are witnessing

an augmentation of the use of plant through the implementation of shift work; an augmentation of the hours worked through the augmentation of overtime and the collapse of the hours of leave due to illness or accidents; [the growth of] the replacement of contractual institutions such as holidays and short workdays due to festivals by money sums. (18)

A result of this is not just a general worsening of the conditions of existence, but also, and this is a factor even more relevant for the aim of a political recomposition of the class, a further pressure towards the fragmentation and atomisation of the class (19), which cannot help weakening and retarding a collective class response to the bourgeois offensive underway:

Almost all strata have become rather heterogeneous and internally unequal. The diferentiation of the professions and the conditions of work induced by technology and organisational models; the diversity of conditions of life and accommodation between areas and within the large cities; these are all variables which intersect among themselves and give rise to a growing variety in position and status within the same social stratum. Specifically, as regards the inequality in income from work in the advanced countries, from the early ’70’s to the ’90’s this grew not only between qualified and unqualified workers, but even more within, respectively, the stratum of the former and the stratum of the latter, within the same sector of activity more than between one sector and another. (20)

Now, without overvaluing nor acritically embracing these considerations, because there has never been a totally homogeneous proletariat, they do, however, without a doubt, encapsulate the basic facts; for example, newly employed workers, even with potentially permanent contracts, enjoy (as they say) wages and norms which are generally worse than those of their work colleagues, more than was the case in the (recent) past. Despite all this, we are witnessing the substantial passivity of the working class, which accepts or calls for “solidariety” (21) contracts, as at Volkswagen or as a FIAT worker at Termini Imerese called for on Italian TV (TG1 at 20:00, 21st November 2002); a class which exchanges rights for cash, which does overtime, which therefore prevalently moves on the individualist economic terrain desired by the boss. Perhaps, then, and without falling into mechanicism (or idealism, which is the same), the crisis has not bitten sufficiently into the flesh of the (“Western”) proletariat to push it, not onto the revolutionary terrain, but at least onto the path leading to the revival of true class struggle. Taking account of the warnings just enunciated, if the Argentinean proletariat (or the working class in FIAT) has moved, it is because there is nothing more to turn into cash, nothing to negotiate, nothing to “solidarise” except hunger and struggle, no possibility to make up for the fall in wages with overtime, to try to conserve that level of consumption which has been made possible up to now by the enormous development of the forces of production between the end of WWII and now. (22)

And, above all, the heaviest attack has been with regard to indirect and deferred wages, diluting the perception of its extreme gravity. We are referring, of course, to the reform of the pension system (which doesn’t just strike at Italian workers) and, in general, of the entire “social state”. Staying in Italy, the various reforms which happened between the Amato government and today (and, as every government threatens, certainly have not finished here) have premised pensions at literally starvation levels, unless people’s working lives are infinitely prolonged. These provisions, just because they will make themselves felt in a future more or less distant, have in fact provoked indignation, but at levels far below their effective and devastating importance. The same goes for the health reforms (which, however, have not finished): although these hit every worker, they do so individually, when we are reduced to the state of “citizens”, atomised individuals closed in their own thoughts, who find themselves having to pay a machine for doctors’ notes, medicines or ambulance charges, etc. Against who should you protest: against the machine, against the receptionist? It is very difficult to go from swearing to a self-organised struggle of... “citizens”.

We should add to this that, although unemployment has become a mass structural phenomenon, the diverse levels of its incidence in the economically active between one region and another (not just in Italy) is very striking: apprentices in the North, although hyper-exploited, have a “spending power” (and this is more so if they live with their family) that the young unemployed (or in the black economy) proletarian in the South does not have, with all that this entails in terms of social rage.

The author of a study frequently cited here, in comparing the data (in fact understated) for American unemployment with those for Germany, observes that:

many new jobs [in the USA] are found in economic sectors of low productivity[...] in shops, in restaurants and in small services to individuals. In the mid- ’90’s the result was that 55% of the workers were employed in these sectors, in comparison with the 45% registered in Germany [...] If Germany reached the same level of occupation in the sector of these small services, we would have less unemployment here than in the USA. (23)

Now, it may appear paradoxical to talk about a special privilege, seeing the conditions in which the US proletariat finds itself, but, without the massive rake-off, of about $500bn a year, that Yankee imperialism extorts from the whole world just by possessing the world reference currency, the USA certainly could not allow itself the “maintenance” of such a vast unproductive (of surplus value) sector; and this is without discussing the enormous overall indebtedness of American society, which, one could say, lives well above its real economic possibilities. The same can be said of the $200bn (again, per year) which is pumped from the “South” - that is, from the exploitation and the blood of the exploited of these regions - into the accounts of the “North” (which the bourgeoisie of the “South” also gulp down), for servicing debt payments alone. (24)

But, as well as all this, the periphery and semi-periphery play a fundamental role in slowing (but not stopping or even reversing) the world fall in the rate of profit, and, therefore, in attenuating the sharpest consequences of this fall for the metropolitan proletariat. Not only have the most brutal and massive redundancies up to the present been carried out by the great multinational groups in the economically weakest countries, (25) but goods produced at low cost in the periphery and semi-periphery, above all as a consequence of so-called delocalisation, contribute both to holding down the value of labour power and allowing it a certain level of consumption, given that the goods coming from these zones form an important part of the “goods” which enter into the reproduction of labour power itself. From clothes to computers, from domestic electrical goods to toys, a considerable proportion of the objects for daily use/ consumption are produced in “developing” countries or in the ex-Soviet Union.

It is worthwhile, then, to dwell on these points, and save the development of the discourse for another occasion.

Continued in the next issue

Celso Beltrami, Katarisum

(1) M Stefanini, “Il rapporto tra capitale e lavoro nel processo di crisi in Italia” (“The capital-labour relation in the unfolding of the crisis in Italy”), Prometeo, V series, no. 5, 1993, and “Dopo la ristrutturazione, la nuova composizione di classe. Verso la ripresa delle lotte proletarie”, (“After restructuring, the new class composition. Towards the revival of proletarian struggle”), Prometeo, V series, no. 6, 1993.

(2) The cited Prometeo 5, p11.

(3) L. Gallino, Globalizzazione e disuguaglianze (“Globalisation and inequality”), Bari, Laterza, 2000, p37.

(4) Prometeo, V series, no. 13, 1997.

(5) L. Gallino, Il costo umano della flessibilità (“The human cost of flexibility”), Bari, Laterza, 2001, p5. Later, p19-20, he again takes up the concept and deepens it: From the beginning of the ’90’s, throughout the world institutional investors - especially Anglo-S axon pension funds, with portfolios of hundreds of billions of dollars - demanded that companies reward their capital with rates of 10-15% per annum. Seeing that they had the fattest share of the companies’ shares at their disposal, no manager, from the managing director downwards, could even think of denying their requests. But how could they obtain from the capital invested in the company a revenue of 10-15% p.a., when the economy, or rather the GNP, was growing in the best of cases at a rate of 3% p.a.? Certainly not by producing goods and services, because the rate of growth in GNP is nothing but the sum, recalculated year on year in real terms, of their value. Rather, by spasmodically suppressing the costs of production, starting with those over which you have the most direct control - labour costs. Both those in your own company and those of your suppliers. In so far as it perm its the establishment of a stricter relation between the pace of production and the quantity of labour power utilised, flexible working is an instrument that managers are constrained to use.

(6) U. Beck, Il lavoro nell’epoca della fine del lavoro. Tramonto delle sicurezze e nuovo impegno civile (“Work in the epoch of the end of work. The end of security and the new public employment”), Turin, Einaudi, 2000, p121-2.

(7) U. Beck op. cit., p123-124.

(8) Ibid.

(9) This so-called co-operative working resembles very closely the gang system in use in 18th century England. See K. Marx, Capital, Vol. I, Chapter 25. In the Lawrence and Wishart edition, see pp649f.

(10) R. Bellofiore, “Il caso italiano” (“The Italian Case”), Rivista del Manifesto, no. 17, May 2001, p31.

(11)The bottom line is that, in 2001 real gross wages were greater than those of ten years earlier by a bare 5%, while the productivity of labour grew by 24%. The real net wages were - instead - lower in 2000 than they were ten years earlier. The growth in real wages has not shone in hardly any European country in the last decade; and, in the last three years in the euro zone real wages have remained at the starting line [...] In short, employees’ earnings have never before sufered such an abrupt and persistent suppression in half a century of Italian history”, M. Zenezini, “Quanto costano i bassi salari?” (“What is the cost of low wages?”), Rivista del Manifesto, no. 33, November 2002, p32.

(12) See “Appunti su globalizzazione, classe operaraia e azione sindacale” (“Notes on globalisation, the working class and union action”), Prometeo VIth series, no.4, 2001.

(13) B. Ehrenreich, “Nickel and Dimed: On (Not) Getting By in America,” Metropolitan Books, 2001. The “food banks”, as can easily be guessed are modern soup kitchens, where the poor receive the donations of rich individuals.

(14) B. Ehrenreich, ibid.

(15) U. Beck, cit., p152.

(16) Federazione Italiana di Operai Metalmeccanici - Italian Federation of Metalworkers.

(17) O. Squassina, “Il salario disequale” (“Unequal wages”), Rivista del Manifesto, no. 15, March 2001, pp25-26.

(18) O. Squassina, cit., p25.

(19)We must then conclude that secondary contractual negotiations [i.e., on the level of the firm rather than nationally] and the spreading of practices which link pay to company results have not compensated for the decline of [the contribution to pay of] national contractual negotiations, have not always succeeded in linking earnings to the dynamic of efective inflation, have pushed towards a widening of salary differences (including between the North and the South) and, in the long term, have not succeeded in biting into earnings linked to productivity”, M. Zenezini, cit., p34. Once again, we cannot but note that, despite the “restrained” language of the reformists, the reality emerges in a sufficiently clear way.

(20) L. Gallino, “Globalizzazione e disuguaglianze”, cit., p73.

(21) “Solidarity” with the bosses, it goes without saying!

(22) The rather generalised entry into home-owning attenuates, to some extent, the effects of the drop in wages, as the fact of paying a mortgage (and not a rent) can put the brakes on the readiness to struggle; one could risk, in the long term, the loss of ones house. On this question, the observations of Engels in The Housing Question (which we quoted in “Da Vienna a Porto Alegre”, Prometo, VIth series, no. 3, 2001) are still valid.

(23) U. Beck, cit., p162.

(24) U. Beck, Repubblica, 8th November 2002.

(25) M. Dinucci, Il sistema globale 2002, Bologna, Zanichelli, 2002, p4.

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