Swans Commentary » swans.com April 10, 2006  



Paris: Center Of Anti-Corporate Globalization Today


by Raymond Garcia





(Swans - April 10, 2006)   Youth protest has again shut down the streets of France, rallying the public to an unjust exercise of social power. Echoes of 1968, you say? Perhaps yes, perhaps no. Yet the facts are clear: two youth-led general strikes have paralyzed the country, and their protests on these and other days have drawn the attention of the world (outside the U.S. for the most part, of course) to the nasty side of corporate neo-liberal economics, or corporate globalization.

The comparisons to 1968 are not relevant in all honesty, just like the comparisons of the US War in Iraq to Vietnam are irrelevant. The times and circumstances are far different, to the point of making comparisons a waste of time. Sure, youth are protesting in France, like in '68, and the U.S. is again bogged down in an unwinnable war on the other side of the world. But the direct comparisons end there. To be clear, the fraud of US empire has been exposed within a year this time, as opposed to a good four to six years last time, while the youth of France today fight to prevent change, as opposed to bringing down a fossilized old order last time. Such comparisons distract us from the real issues and events at hand.

Villepin's CPE, the new law that would institute a two-year period during which workers under 26 could be fired for any reason, without cause, is a blatant attempt to break down French resistance to neo-liberal economics based on the US model. In other words, significantly weaken the power of working people and their unions' ability to represent their interests.

The comparison to the US economic model should be obvious: US unions were broken long ago. Today barely 10% of private sector US workers are represented by unions. This is far from the case in France. Villepin and French elites gaze enviously at the tremendous flexibility US capital interests can exercise in relation to their workers. Want to dump benefit liability? Want to move a production plant to Mexico or overseas to China? No Sweat! Unions can't stop the move, and US government deregulation and corporate tax subsidies grease the skids. There is no accountability for the general good of society for capital investment in the U.S. today, and Villepin and Co. want in on this free pass for corporate interests. The CPE is a clear step in that direction. And French youth today will obviously not have it, not without a fight.

The key word in the previous paragraph is flexibility. This is linchpin of the lexicon of corporate globalization. To fathom this, one must understand the transition from Fordism to Flexible Accumulation, or flexibility, in the mode of capitalism in the U.S. As illustrated in the political economic work of David Harvey, James O'Connor, Piore and Sable, et al., Fordism was the dominant paradigm of US capitalism in the unprecedented economic boom years of the post-WWII era, from 1945 to the late 1960s to the early 1970s (precise dating is rough in political economy). Fordism was characterized by a somewhat stable balance of power between three social sectors: corporations, labor unions, and the government.

In the wake of the destruction of Europe by two so-called "world wars" (and Japan by one) and a depression, the U.S. stepped into the "void" of western world leadership in 1945. The U.S. offered "generous" loans for the rebuilding of Europe (not including the Soviet Union of course, our new enemy), contingent on the purchase of US hardware, a stipulation that remains to this day for US generosity. With such a captive market, US prosperity exploded.

Corporations, labor unions, and the government all played key roles in spreading the benefits of this prosperity. Corporations have proved to be the most effective entities for raising investment capital ever devised: after all, they ultimately have no real liability in the end, simply dissolving and reforming under a new guise if need be. They also created the modern consumer economy, stimulating endless needs people didn't even know they had, built on the foundation Henry Ford had laid out in 1914: paying workers enough to buy the products they produced (while surveilling and disciplining them in panoptic fashion at every step). Though it didn't catch on until post-WWII, it became the paradigm for US prosperity for 25 to 30 years.

Labor unions played the role of helping to spread the benefits of this era, especially in terms of establishing worker rights and increasing worker pay and benefits. They played another key role in the U.S. as well, keeping a lid on worker radicalism. As anyone knowledgeable of the era knows, capitalism was in dire straits over the course of the Great Depression, and working people (always the overwhelming majority) could well have banded together to overthrow this system that had left them destitute. Embodying the ghost of Tom Joad, one might say. However, labor unions were officially recognized and in a sense bought off, as leaders like the Red-baiting Walter Reuther of the UAW negotiated higher pay and benefits and purged the union ranks of labor radicals. This would have significant portents down the road.

The government played the role of mediator between the two, while also pouring massive investments of taxpayer money into fixed capital investments, aka infrastructure, making commercial growth inexorable. Through the G.I. bill, low-interest mortgages, and development of a national highway system, under the guiding hand of the Highway Lobby, government investment funded a transformation in the US economy, while lining the pockets of those "in the know." They also played the role of absorbing surplus production capacity in the private sector, especially in terms of the massive investments in military budgets and weaponry. In a sense, capitalists were insured from the results of their worst faults, as illustrated by Marx, by playing with house money. With surplus production underwritten by government budgets, how could they lose?

However, this tripartite configuration only lasted so long, even though it produced a historically unprecedented period of prosperity for the U.S. Contradictions developed, as history dictates they always do, especially in terms of capitalist boom and bust cycles. The cost of fighting the Vietnam War off budget came home to roost, producing federal budget deficits that neutralized the government's ability to insulate capital investments from their own folly. Nixon's decision to float the dollar on speculation markets and the oil price shocks in the wake of the Yom Kippur War in the Middle East left the economy nakedly exposed to factors resulting from US global policies, results that were no longer under US control.

Social groups denied access to the "American Dream" of Fordism made their claim in public forums rife with social strife. And labor unions, which had protected their own at the expense of minorities, women, and future workers, found themselves effectively neutered, as they had negotiated almost all control over practical workplace operations for higher wages and benefits, much less with any remaining radical potential. In short, Fordism unraveled in the midst of late 1960s and early 1970s contradictions that became overwhelming (admittedly, the short version).

As Fordism declined, what we now know of as neo-liberal corporate globalization emerged from its ashes, just as Marx had predicted the seeds of the new order are always planted in the old. Here the tripartite power relations morphed into one power: corporate capital globalized. Over the late 1970s and early 1980s, the US government de-regulated virtually all economic activity, while submitting to corporate demands for ever-growing subsidies and tax cuts. Carried out in the name of "re-investing in the U.S.," de-regulation and tax cuts fomented the global capital flight that has destroyed the US manufacturing economy. No more accountability to anything but profits for corporations, and no more involvement for workers in anything but protecting the shreds of jobs that remained, slipping further and further away, as it has turned out.

The new order at this point, signified in the early 1980s by Ronald Reagan and his tax cuts for corporations and the wealthy, and his sacking of PATCO, the union for air traffic controllers (public safety employees, for fuck's sake!), can now be characterized as the dawning era of flexibility. Put most succinctly by Mike Davis (paraphrased here), the rules of capitalism had morphed into maximum central financial control, implementing flexible producers and sellers, deployed across variable international landscapes.

These are the rules of corporate globalization put plain. The U.S. sponsored and enforced race to the bottom, in terms of lowering labor, supply, and production costs to the absolute bottom. The decimated US manufacturing economy stands in clear testament to its results, as do the thousands of abandoned factory sites across the world, forsaken for cheaper short-term costs elsewhere. Workers are not individuals, citizens of a community or country; they are simply another cost in the supply chain driven by corporate needs for ever-growing profits.

Its ironic, but ultimately useless (given US politics) to point out that the vast majority of global treaties negotiated to enforce flexibility on global markets came under a Democratic White House -- the Clinton administration -- effusively supported by the remnants of US labor. The epitome of this came with the establishment of the WTO as the replacement for GATT as the primary regulator of global trade in 1995, under Clinton's guidance. In short, the prime directive of the WTO is to destroy local autonomy in global trade, also known as local laws and social investment, clearing the path for corporate global investment anywhere the costs of profit accumulation may be cheaper.

Now come the French students. In tune with vast global resistance to corporate globalization developing (see, for example, Bolivians opposed to privatized water supplies, the rejection of the MAI accords in 1998 that would have established international corporations as the equal of locals across the world in terms of investment rights and powers, and the unprecedented agreement of China, India, and Brazil to reject unfavorable trade rules, etc.), the French youth are standing up to the U.S.-led race to the bottom. In the U.S., with a neutered labor movement for now, we have accepted "at will" employment contracts, which means we can be fired for no reason, no question, no recourse, a key element of flexibility in labor markets. The French youth say to this a resounding NON.

French youth are fighting to protect the remnants of a social contract in the midst of corporate globalization that has no use for anything but profits. Here change augurs the world of flexibility that they explicitly reject. Far from demanding "undeserved benefits," as much of the world's corporate press would have it, they stand for human rights in the face of a government all too willing to sell out their future. And they have French labor unions on their side, as illustrated by reports from folks like University of Massachusetts economist Richard Wolff, and William Pfaff of the International Herald Tribune. Here the similarities of 1968 echo: youth and labor together. Yet this is totally different, as the new, not the old, is the agent of noxious social destruction.

Here in the U.S., media reports have been predictably slanted toward parody of the issues, as if the empowered French youth are merely misguided idiots, if it's covered at all. Hilariously, the Wall Street Journal called this protest "mob rule," a renunciation of Enlightenment principles, a sign of "a purportedly mature democracy" (3-21-06). Let's see, citizens empowered to act as democrats in their own interests are unenlightened and immature. And here in the U.S., we're enlightened and mature, choosing between two candidates that represent the same corporate interests in staged dramaturgies every four years.

Corporate globalization is heavily tilted toward the "destructive creativity" of Joseph Schumpeter's famous equation of capitalism's "creative destruction." One doesn't have to go far in the U.S. to see formerly prosperous cities in total ruin. All one has to do is read the corporate daily news with open eyes. "Gee, ain't it bad" doesn't get it, never has, never will. French youth today get it. Could it be possible we'll ever get it here in the U.S.? Whether we do or not, the corporate globalization pushed by the ownership class in the U.S. and their political toadies will be collapsing soon. Then what does the future hold? To cite Marx yet again, the seeds are contained within. Do we water them or stomp on them like brownshirt fascists? That's the real question. Perhaps like Jefferson, author of the Declaration of Independence, we could turn to the French. Of course, we'd have to be enlightened then, wouldn't we?



Harvey, David, The Condition of Postmodernity, Blackwell, 1990.

O'Connor, James, The Fiscal Crisis of the State, St. Martin's, 1973.

Piore, Michael, & Charles Sabel, The Second Industrial Divide, Basic, 1986.

Davis, Mike, City of Quartz, Vintage, 1992.

Wolff, Richard, "France's Student-Worker Alliance," Monthly Review Zine, March 31, 2006.

Pfaff, William, "Capitalism Under Fire," International Herald Tribune, March 30, 2006.

Editorial, Wall Street Journal, March 21, 2006.


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About the Author

Raymond Garcia is a "lumpen academic" (aka untenured university instructor), currently at Michigan State University. In the fall, he'll be a visiting professor at Aquinas College, Grand Rapids, Michigan. His columns, "Confessions of a Lumpen Academic," used to be published by Bruce Anderson in the Anderson Valley Advertiser. Garcia also contributes to the online magazine Loafer's. He lives in Lansing, Michigan.



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Published April 10, 2006