Speech by WFTU General Secretary George Mavrikos at the International Seminar on: “The Economic Crisis and the Role of the International Trade Union Movement”, October 5-6 2009, Brussels

October 7, 2009

Dear friends,

We would like to welcome you to our Conference stressing that your presence here is very important for us. We believe that in this period the exchange of views and experiences on the crisis is very valuable in order to achieve a better coordination in our struggle for the rights of workers. We organized the Seminar on this issue because we know that the issues of the crisis are complex to explain, but also the interpretation and understanding are fundamental for shaping the consciousness of workers and for the planning of our tactics.

We welcome Mr. Mohammed Mwamadzingo from ACTRAV-ILO and we will listen carefully to his ideas and suggestions.

As we all know, the international capitalist economy is going through a deep crisis with extensive synchronization. This situation began firstly in 2007 in the U.S. in the construction sector. The risk of collapse of U.S. financial giants with strong positions in the international market caused a gradual and generalized big value drop in major stock markets of the World. This was the “tip of the iceberg”. There are many analyses of the outbreak of the crisis. We believe that the most reliable one is that it is a crisis of overproduction or otherwise over accumulation of capital. A crisis is a component of the capitalist system and it is also a mechanism of reconstruction that will bring it back stronger, with the support of the State. Through the crisis, the corrections of the more extreme imbalances of capitalism takes place momentarily and partially, to then start a new cycle of unregulated and broadened capitalist reproduction. Already in 1847, Karl Marx gave a scientific explanation for the crises of capitalism. He explained that these are inevitable, cyclical and repetitive. Life itself has confirmed this explanation.

Over the past decade, for example, another recession has developed embracing the economies of Southeast Asia, Japan, some countries in Latin America, and later manifested in the U.S. The gross World product shrank by 1%, international flows of capital for direct investment and international trade experienced big cuts. The theories about the causes of the crisis at that time were only examining the apparent failures in the movement of capital in monetary form. They focused on how the stock markets function and the terms of loans granted to the states by the IMF and the World Bank. We estimate that, as it happened in previous years with the most characteristic example the crisis in 1973 – the cause of the crisis was the overaccumulation of capital regardless of the initial manifestation. The way out of the recession then, the transition to a new upward phase of expanded capitalist reproduction led to the development of a new crisis of overaccumulation, deeper and more synchronized than the previous one. Also in all these countries, working conditions, salaries, and working-class life has not improved but worsened. At the same time, under conditions of expanded capitalist reproduction, the tendency to reduce the labor income while increasing the degree of exploitation prevailed. This tendency took the character of a concerted offensive, as in the European Union with the Lisbon Strategy and withdrawal of labor and pension rights so as to reduce labor costs in the European Union market.

In the current decade new acquisitions and mergers have taken place; the international interlinking of capital has increased; international capitalist competition has intensified, especially between the U.S. and Russia for the control of markets and the domination over productive resources; the multinationals and monopolies have been strengthened and the regional alliances have been rearranged. All this, as reflected in previous international crisis capitalist cycle took on an irreversible character in the current tendencies. In this framework the new economic crisis developed at the international level. It began in the U.S., it spread deeper into the Eurozone, it embraced the United Kingdom, Japan, Russia, Turkey and some countries in Latin America.

This crisis will last longer than the previous one and will be tougher. It has already registered an increase of 25 million unemployed people worldwide while unemployment is estimated to increase another 40 million by the end of the year. The World Bank estimates a reduction of the Gross World Product in 2009 by 1.7%. According to the the OECD, this reduction will be 2.75%, and the reduction of international trade will be 13.2% in 2009. The IMF estimates the depreciation of financial capital to 4.1 trillion dollars from the start of the crisis so far. This situation will exacerbate the existing social inequalities and social problems by increasing unemployment, part-time job and flexible labour relations. According to bourgeois measurements, poverty has already grown as well as the absolute impoverishment of part of the working class. At the same time we want to underline that the change of the balance of power between the imperialist powers, the sharpening of inter-imperialist contradictions strengthens the danger for imperialist wars and interventions against the peoples. This is proven by the developments in Georgia, Iraq, Palestine and especially in Pakistan and Afghanistan. The NATO military exercises in Georgia and the promotion of U.S. plans in Afghanistan and Pakistan, which include changing the borders of states in the region, mark the attempt to consolidate their position in Eurasia. U.S. analysts - referring to Pakistan, Afghanistan, Iran, Nigeria, Yemen, etc. – estimate the emergence of dangerous arcs of instability and the proliferation of conflicts before 2020. The new upward tendency in global military spending by 45% between 1998 to 2007 is another important indication of the sharpening of inter-imperialist contradictions.  It has already been reported that the Obama government is expected to increase the sales of modern weapons even more than the Bush administration, which had an increase of 50% in its term. It is estimated that the diplomatic openings of the Obama Government “to new allies” represent endless possibilities for sales of sophisticated weapon systems, despite the crisis, which will not be left unexploited by the U.S. government.

It is confirmed that the bourgeois class is implementing its ideological and financial interventions vis-a-vis the working class.  The forces of capital seek to end the crisis through the escalation of aggression against the workers and peoples.  They advocate “All together against the crisis” and are organizing a wide network that traps a large part of the working class by requiring commitment to its objectives. They buy them out through benefits and allocations, they call for class collaboration for the way out of the crisis, while even today a large part of the capital is increasing its profitability. They are supported by the action of trade unions dominated by the forces of opportunism and compromise. They intensify repression through NATO’s plans for “urban crises.”  Generally the showing of a common understanding and consensus strategy by the forces of capital, despite the differences between them, appears in the policies to shift the consequences of the crisis to the workers. On the other hand what is shown as a remedy for the problem becomes poison for the other existing problems.

Despite the fact that in July 2009 it seems that banks returned to a state of profitability, the effects of the global capitalist crisis continue to severely affect working people worldwide.

Here are just some data of the last trimester:

• According to Eurostat in all the 27 countries of the European Union in June 2009 unemployment reached 9% (9.1% for men and 9.0% for women). Denmark had the lowest percentage (5.9%) and Spain the highest (18.5%), proving to be particularly vulnerable to the global capitalist crisis with a continuously shrinking economy. The data show that the crisis has revealed the myth that the EU multinationals can ensure sustainable development with benefits for the workers. For example in Britain in July, Lloyds Banking Group (LBG), (a group created by the merger of British bank Halifax Bank of Scotland and Lloyds TSB) 43% of which belongs to the state, announced the dismissal of more 1,200 workers, reaching 8,200 jobs abolished from the beginning of the year in which the group was formed. In the same month, the German «Siemens» announced 1,400 job cuts in its attempt to “achieve the objectives set for annual profitability”. More lay-offs are expected in Germany, Britain, Switzerland and Sweden. Already 17,000 jobs have been cut and the working time has been cut for a total of 19,000 employees. In France, 375,000 employees have been fired. This number is almost double for the total of jobs lost in 2008 according to the National Statistical Office (INSEE). In September, «Air France» announced cuts of about 1,500 jobs through a voluntary program of retirement. In Italy, the unemployment will reach 9.3% by 2010 as estimated by the Italian Institute of Economic Research and Analysis, ISAE. In a relevant study, the Italian Council for Economy and Work, CNEL, estimates that the Italians that will lose their jobs might be more than 500,000 people. In Russia it is estimated that 24.5 million Russians live under the poverty line and this number will increase more than 30% in the first quarter of 2009 compared to the preceding quarter. This number represents 17.4% of the population, according to Rosstat.

• In the U.S. in July 2009 the official total unemployment rate reached 9.4% (10.5% for men and 8.1% for women) although the actual unemployment rate has reached 16% according to statements by the U.S. Federal Reserve (Fed). In total, from the beginning of the crisis, in December 2007 until July 2009, 6.5 million workers lost their jobs.

• In Japan, in the 3rd quarter of 2009, unemployment was at 5.7% (6.1% for men and 5.1% for women) - a record for the country.

• There are 3.5 million unemployed workers; this number has increased by more than 1 million compared to last year. The companies continue their dismissal policy, despite the fact that, according to the Ministry of Finance, the country “has returned into a growth environment after the worst recession in decades”. It is enough to say that in the labor market in Japan for every 100 people seeking work, only 42 jobs are offered.

In this context and in order to save the system, the liberals and the social democrats promise a “humane, healthy capitalism” with the international social democracy to play a leading role in this effort and to put the blame for the crisis only on”neoliberalism.” It tries to convince workers that it has elaborated a new prescription. It promotes the so-called “Green Economy” - which is a new source of profit and wealth - or the “best and most equitable distribution of wealth” and say nothing about the unjust, exploitative nature of capitalism.

Workers in all countries want to improve the quality of their lives, to improve the environment and the working conditions in their workplaces. The environment is a key priority for the international class-oriented trade union movement. Climate changes affect us all. Nobody is indifferent. But we are concerned about the involvement of multinationals in environmental issues. Even though it is they who create the problems and destroy the environment, they are trying to make profits with the hypocritical interest they show.

A very characteristic example is the case of the former Prime Minister of Great Britain Tony Blair, who founded an organization called “The Climate Group” supporting the development of nuclear energy to reduce the role of the Middle East and Arab world. In that Group are involved BP, TEXACO and some large pharmaceutical companies.

Another example is also the company “Corporate Leaders Group on Climate Change” (CLG) founded by the Prince of Wales Charles and having as major shareholders the banks HSBC and Royal Bank of Scotland, SHELL, ING, COCA COLA, NIKE, DEUTSCHE TELECOM , VODAFONE, FRANCE TELECOM etc. Five days ago in FRANCE TELECOM that promotes the so-called “Greece Economy”, a 51-year old employee ended his life leaving a letter to his family denouncing its employers. This is the 24th employee suicide committed in FRANCE TELECOM during the last 10 months. The 24th!!

All these trusts are hypocrites when they say they want a better environment. The truth is that they exploit an existing problem to increase their profits. The workers around the world should know the truth and struggle for environmental improvement combined with the proper political and social goals.

Dear colleagues,

The W.F.T.U. believes that as long as wealth is accumulated in the hands of the few and poverty is spread to the many, the crisis will be deeper and more harsh (sic).  Since the beginning of this period we have expressed our main demand: the crisis to be paid for by the capitalists because it is they who create it. Every day, the working class is sacrificed on the altar of capitalist profit. We not only face a crisis of the economic system or of neoliberal policies, but we are confronted with the extremes of the capitalist system and extreme exploitation. Today the possibilities of the working class to counter-attack have increased. A key element will be the position of the movement and the line to follow.  The ideological defense of capitalism will be increasingly undermined.  What happens now, has happened many times in the past, it formally started in the beginning of the 19th century, and it will also happen in the future as long as capitalism exists.  The deterioration of working class life will be intensified if it does not fight back.

Dear friends,

We have the responsibility to inspire and guide workers to unite together and strengthen the labor movement. To insist that the satisfaction of the workers contemporary interests and needs is directly linked to decisive action against the forces of capital and its political and trade union supporters.

The W.F.T.U. has already elaborated a plan so that workers and peoples will not pay for the consequences of the crisis. We believe that our proposals are based on realism and can be implemented. Among other things it is necessary:

• To stop the weapon programs and to drastically reduce military expenses. To stop the occupations and wars of the imperialist forces.

• To make public investments and create jobs with full labor rights.

• To assist the workers directly with real increases in their salaries and pensions so they will have stronger purchasing power. Also to increase social spending for workers, to strengthen their social security, public health and education and reduce working time without any reduction in employment rights.

• To prohibit the dismissals and provide significant aid to all the unemployed with no exceptions.

• To stop the privatization of strategic sectors.

• To establish full respect for labor rights for immigrants and for young and women workers.

• To cancel the debts of third world countries.

In the last period we tried to push forward and promote our demands:

• In December 2008 we organized in Lisbon, Portugal an International Seminar on “Globalization - Economic Crisis and Workers’ Rights” and we proceeded to the publication of the materials of the Seminar, which are an important ideological tool.

• On February 12 and 13, 2009, we organized together with the ACFTU of China the World Trade Forum of Beijing on the issues of globalization and the economic crisis.- In the beginning of this year we informed the trade unions on the Action Plan of 2009, sending a broad call for its implementation.

• On April 1, 2009, declared as the International Day of Action, organizations in 45 countries around the world organized mobilizations. This militant step has been a useful tool for our militant forces which were coordinated in the struggle against the consequences of the crisis and decisively promoted our demands.

• We payed tribute to May Day with demonstrations around the world setting in the heart of our activities the issues of the economic crisis.

• During the Annual Conference of the ILO in June 2009 we raised the issues of the economic crisis from the perspective of workers, insisting that they should not suffer from its consequences.

For the next period we are planning:

• Within 2009 we will organize 3 new Regional Conferences (in Europe, Latin America and Africa).

• On November 18-20, 2009 we are organizing in Lima Peru an International Meeting of Young trade unionists to discuss todays’ issues.

• On December 1-2, 2009 in Athens we are organizing an International Congress of Workers in the Hotel and Tourism sector.

• We will declare a new date for the International Action Day of 2010 (it will be decided at the Presidential Council meeting to be held in Hanoi in February 2010).

• In February 2010 we are organizing a debate in the International Trade Union Forum to be held in Beijing in China with the largest trade unions from around the world.

We believe that our action during the next period must be strengthened gradually and steadily. We are not only in the line of defense. We have the necessary ideological weapons and we have justice on our side. We can move forward step by step to the counter-attack. Our adversaries know that and are afraid.

In the 15th Congress of the WFTU looking at the future, we started a new course. We believe the 16th Congress will find the global labor movement in a better position.

Thank you