If there was ever any proof needed that the central concerns
of the #occupy movement, about rising social inequality and injustice, and the
absence of democratic institutions willing to protect the interests of the vast
majority, surely we got it in the behaviour of Qantas management over the last
few days — and the Gillard government’s response, which took the bait and
came down dramatically on the side of the bullying employer.
The lock-out — pre-planned but started with only a
moment’s public notice just a day after a stormy AGM where big shareholders
overwhelmingly backed CEO Alan Joyce’s 71 percent pay rise and the board’s
strategic direction — also demonstrates how Australia is not immune from
growing economic and political instability internationally. Within this
context, there is the likelihood of this dispute accelerating popular anger at
the corporate elite and exacerbating the crisis of authority of the political
class and the state. And, given the high-stakes game that Joyce is playing, the
result will play an important role in shaping future resistance to the effects
of the crisis from below.
Qantas: A high-stakes
pre-emptive strike
By acting in such a belligerent manner towards the three
groups of unionised workers (pilots, engineers and ground staff) currently
pursuing bargaining, Joyce is enacting a long-run strategy to increase Qantas
profitability by devolving a large chunk of its operations into low-cost
subsidiaries, some located offshore, to take advantage of lower wages and
operating costs. But it is also about screwing more out of its existing Australian
workforce through restructuring and raising the rate of exploitation. As
Crikey’s airlines analyst Ben
Sandilands puts it, this is about the “shutting down of what the current
management sees as unaffordable excellence in its full service operations”.
This is what lies behind management bluster that the unions are being
“unreasonable” — for workers to be “reasonable” here would mean accepting
wholesale cuts to jobs, wage and conditions and, perhaps more alarmingly, safety
standards.
The hysteria over industrial action generated by Qantas
spokespeople, the media (including the ABC) and certain politicians is
completely at odds with what has actually happened in workers’ struggle for a
modest wage rise and some guarantees about job security. Qantas has taken
ads and briefed a pliant news media about “chaos” after unions have given the
legally-mandatory three day warning of protected action, while simultaneously
using social media to ensure its passengers come a little earlier or later to
the airport to make a flight, thus
causing minimal inconvenience. This explains the spectacle of reporters
talking of “union-caused disruptions” in front of perfectly calm terminal
activity — something that cannot be said of the current lock-out.
At least Joyce was being honest on Inside Business when he
admitted this was not about Qantas facing an imminent financial crisis due
to union action or competition, but about preparing for the future. He claims major
losses from the carrier’s international arm in the context of increased global
competition as a key factor in seeking a restructure with major concessions
from the workforce. However, thanks to opaque accounting practices, management
claims that within a $552 million profit last financial year there was a $200
million loss from Qantas’ international operations are impossible to substantiate.
Given combined domestic, regional and international operations supplied $228
million of the total profits, this
seems to be a highly unlikely figure. Attempts
to drill through extant figures suggest there may be more than a little
fancy accounting at play.
More importantly, there is clear evidence that it is
management strategy more than anything that has — intentionally,
inadvertently or through bad luck — led to the rapid shrinkage of Qantas’
international market to just 18 percent of people coming and going to and from
Australia. By focusing its European business through London, forcing lengthy
and frustrating transfers onto BA flights, Qantas has seen its customers desert
it in favour of airlines that fly one-stop to multiple European cities.
Recently Qantas also traded routes with BA to cut
the number of QF flights to Heathrow to just two a day.
Qantas is engaged in a race to the bottom on wages,
conditions and safety because of increased domestic and international
competition driven by the emergence of low-cost “no-frills” airlines,
competitive state-backed carriers in Asia in the Middle East, and the pressure
from other traditional airlines having to cut costs in response themselves. An MIT
analysis from four years ago noted that the first half of the 2000s was
marked by massive losses across the global airline industry. This led to
massive restructuring and a return to profitability by 2006, but many
traditional carriers were now facing even tougher competition with low-cost airlines
that had higher labour productivity based on more “flexible” working
conditions, direct to customer internet sales structures, and higher rates of
seat utilisation. This situation has accelerated in the context of the global
economic crisis, with major
cuts to jobs and conditions marking the immediate post-GFC period. As
former Qantas chief economist Tony Webber has
pointed out, the privatisation of Qantas has also left it more exposed to
competitive pressures in the international market than state-owned traditional
carriers, which form just one part of a wider state capitalist project. Webber
has subsequently argued
for nationalisation of Qantas’ international business.
Thus for Qantas workers, Joyce’s admonition to accept his
terms to make the airline profitable and so help protect jobs in the future is
the classic big lie. Accepting the logic of a race to the bottom now will open
the way for more attacks on workers in the future, and if Qantas succeeds that
will only spur its competitors to try on the same approach thereby driving an
increasingly hostile competitive environment. There is no win-win for both bosses
and workers possible here.
The racist and/or nationalist attacks on Joyce for being
Irish (he’s an Australian citizen) or for forcing “Asianisation” on the airline
are a dangerous distraction. Defending wages, working conditions and safety is
a class and not a national issue, especially as a major source of downward
pressure on Qantas workers’ wages is its domestic subsidiary, Jetstar. Similarly,
concerns over the Qantas “brand” accept corporate imperatives over the rights
of the airline’s employees; it’s simply not a favourable terrain for the
workers to fight on. The problem here is an Australian company’s private
profits being backed by the Australian state.
Crisis at the top, flickers
of resistance from below
That Qantas was willing to risk so much says something about
the situation the Australian capitalist class finds itself in more generally,
and the political weakness of the government. Dependent on indefinite Chinese pump-priming
of its economy to fuel a resources boom that has left the rest of the economy
behind, the business elite has become increasingly nervous about the paralysis
of the Gillard government in driving serious economic reform in its interests.
It is not that most Australian businesses are about to face US or European
style economic conditions, but that in an increasingly interconnected world
they cannot fully escape the effects of crisis elsewhere.
The fact that a combination of luck, stimulus and resources exports
saved Australia from technical recession in 2008-9 has, however, led to some
groups of workers finally deciding to take on their increasingly super-rich
bosses, often around simple bread and butter issues. In a situation where cost
of living pressures run ahead of official inflation figures, workers are
hoping not to get left behind. While strike numbers are
still historically very low, there have been enough disputes and a higher
level of confidence to fight in some key industries, to worry some businesspeople
and commentators. What is especially important is how a general popular mood
against the corporations and the government gives even relatively small
struggles a political edge that they didn’t have before the GFC. While there is
no direct connection, the emergence of mass struggle overseas — in Egypt
and more recently against austerity in Europe and now the US — is clearly
framing how many ordinary people view growing talk of austerity and limits on
union rights being peddled by state and federal governments here.
As Left Flank has noted before, public opinion around
socioeconomic issues has generally shifted to the Left since the early 1990s,
even as elite opinion has continued to shift to more emphasis on markets and
the absolute rights of private business. A recent poll has shown that large
numbers of people think
that the government should re-nationalise Qantas (43 percent to 34 percent
against), as well as the Commonwealth Bank and Telstra.
More important in the short term has been Qantas’ inability
to win the public debate. The same poll last week showed that more
people mostly blamed management (36 percent) than workers (13 percent) for
the dispute, although 37 percent blamed both equally. This shows a significant
reservoir of support for the workers’ actions that can be built on now that
Joyce has engaged in such an open act of class war. Interestingly, only
24 percent thought the government should intervene, roughly the same across
all parties’ voters. Yet this is what some state premiers called for and that
Joyce has precipitated with the lock-out: A ruling from Fair Work Australia to
terminate all industrial action and force the issue to arbitration. This
demonstrates how even in this “deregulated” era the ruling class depends on
state institutions to enforce its interests, even if that means forcing the
hand of an ineffectual minority government. This is also about limiting what
the dispute is over, as it seems likely that some of the issues around job
security and restructuring may fall outside what can legally be arbitrated.
The Fair Work Act ties unions to complex procedures about
when they can take action legally. In the case of this dispute, we can see how unions
must give employers three days notice of action while in response bosses
can lock-out at a moment’s notice and with less need to inform various parties.
In addition, termination includes denying workers’ one bargaining chip
— their ability to withdraw their labour — and this is what Joyce managed
to engineer here.
Gillard dances to the Qantas tune
Despite weasel words about “not taking sides”, the Gillard
government applied for exactly the thing that Joyce wants and his lawyers say
they will accept as a minimum
— termination of action. This is what “acting in the national interest”
really means. Even in the case of a (temporary) “suspension” of industrial
action, Joyce could have continued to ground planes for operational “safety”
reasons even without officially calling it a lock-out (and his lawyers
threatened to do so, this making the judges worry that a suspension ruling
would only prove the FWA’s impotence before a major company hell-bent on
defeating its workforce). But there was a risk in such a scenario for Joyce
because the unions could have portrayed themselves as victims of Qantas
bastardry.
But the fate of Qantas workers cannot rely on public
goodwill alone. To date the unions’ strategy has been to threaten strikes but
deliver only limited action. The pilots have engaged in purely symbolic
protests. While union leaders seem to have been prepared that Joyce might try
something like this on, it is not clear how much they are willing to challenge
the legal restrictions on them. Their ties to the ALP, and defensiveness about the
Labor government’s rolling crisis, as well as their historic subservience to
arbitral processes, don’t bode well. On the other hand, while I am not privy to
how Qantas workers feel more generally, it seems unlikely that after years of
passivity their union leaders have actually led something of a fight without there
having been a shift in the mood among the rank-and-file. Given the high stakes,
they may want to take action that a year or two ago would’ve been unthinkable,
even if their leaders are not happy with the prospect.
It’s important to locate this in the context of the crisis
of authority being suffered by the ALP. It is not the case, as
Laura Tingle suggests, that this is a straightforward chance for Gillard to
recover. Labor remains committed to an industrial relations system that
massively disadvantages workers through legal restrictions on their collective
rights. ALP ministers were angry not because Joyce was attacking workers, but because
he didn’t come to the government first.
Gillard
made crystal clear that acting “in the national interest” meant resolving
the dispute through “termination”, thus putting Joyce in a stronger position to
dictate the outcome. It is this that Greens MP and former union lawyer Adam
Bandt slated home in his
attack on the Fair Work Act as a piece of anti-union legislation yesterday.
How this can strengthen Gillard’s political position — except perhaps for
a brief blip by appearing “decisive” — is beyond me. It is precisely
Labor’s open abandonment of its traditional base to the interests of big
business that explains its decline. Whether it can politically control union
officials in pushing this through, or whether the officials themselves can
bottle anger at such a result (which appears to be their intent by initially
going along with the FWA ruling) is also not clear.
But the crisis means that it is much more likely that anti-systemic
ideas of the sort that have fuelled the #occupy protests — however embryonic at
this stage — will shape people’s responses to Qantas and government
actions. Even mainstream commentators have been noting how the Qantas board
have exposed themselves as part of the 1 percent that #occupy protests are
targeting. Now it is clearer than ever that we have government for the 1
percent also.
But in another sense this is just the beginning, and not
just because if Joyce gets most of what he wants in arbitration he will proceed
with a nasty restructuring which can end up provoking further industrial
conflict. The pressures that have led to this dispute can only accelerate
without a resolution to the global economic crisis. Those pressures have not
just made aggressive employer actions to maintain competitiveness more likely,
but they undermine the authority of a political class which has spent the last
30 years repeating the mantra that submitting Australia to neoliberal
restructuring would bring prosperity and certainty for all. Instead they have
created a society where inequality, injustice, and insecurity rule, and the
legal structure of the state is stacked against the 99 percent.
