Gregor Gall: Trade unions’ time has come

TRADE unions’ power has reached a low point, following their ‘demonisation’ by the Thatcher government, writes Gregor Gall. But they could still have a key role to play

Forty years ago, unions were at the height of their post-war power – 1972 saw the victory of the Upper Clyde Shipbuilders’ work-in and the most successful ever miners’ strike. Both government and employers of the day were humbled by the collective might of organised workers. Even attempts to enforce the law – as in the case of the jailing of the Pentonville dockers for breaking the Industrial Relations Act of 1971
– were unsuccessful.

The result of all this was living standards of workers – the mass of ordinary citizens – rose so that parents of the time had some certainty that their children would be better off than they had been.

But as a crisis of capitalism ensued with falling levels of profitability, a rearguard movement was undertaken by the political and economic elite to wrest back from workers these gains. The most obvious case in point was the election of Margaret Thatcher and the Conservatives in 1979. From that point onwards unfolded a series of concerted and effective attacks upon the organisations of workers which advanced and defended their terms and conditions, namely, their unions.

A raft of new laws on industrial action restricted workers’ ability to enforce their collective will upon their employers. Unions became politically demonised as the major restriction on the operation of the free market. Indeed, Conservative governments allowed unemployment to rise to previously unforeseen levels, with the effect of undermining security of employment.

Workers were told that as they were lucky to have jobs, they should not moan about the pay of those jobs. Those that had no jobs were told to “get on their bikes” to look for work.

Under the “New” Labour regime from 1997 onwards, unions were politically rehabilitated to a small extent. But the bulk of the anti-union laws were maintained and the era of treating unions as social partners was not renewed. And Tony Blair went so far as to claim he had scars on his back from fighting the unions over reforms to the public sector.

The impact of these cumulative changes over the last 40 years is that unions are now weaker than at any time since 1945. This means that unions now protect far fewer workers and the strength of that protection is now much weaker, too.

This has had an impact on the wider workforce as well. Unions benefit non-members (the “free riders”) as well, because they raise up all wages and conditions. This is all the more so when the fruits of collective bargaining by unions are applied to all workers, regardless of whether they are members or not.

Overall, workers are now more insecure and poorly paid than at any time since 1945. This means not only huge wage inequality, but the unholy trinity of low-waged, low-skilled and low-productivity work has been maintained and extended.

Higher wages not only make social inequality less extreme, but they also increase ordinary citizens’ purchasing power and compel employers to make their operations more productive and high-skilled by investing in training and technology.

This is the overriding lesson of post-war Germany, which, despite the current eurozone crisis, is the only substantial economy to have recorded economic growth. The situation in the United States is an even more exaggerated version of the situation in Britain. Deregulation and neo-liberalism have gone far, far further, with the proportion of workers in union membership now at less than 10 per cent. It is not uncommon for the highest-paid to be paid 300 times more than the lowest-paid.

That is why increasing numbers of voices are being raised in opposition to the deregulation and rising inequality there. Leading mainstream voices, such as economists and social commentators like Paul Krugman, Robert Reich and Joseph Stiglitz have become scathing critics of the status quo.

These liberals are no lefties. But they do realise society’s very stability and civility is threatened by such inequality. Thus, they believe there is a positive role for unions to play, not only in representing their members (the “vested interest”), but also in protecting workers from inequality more generally (the “sword of justice”.

Applied to Britain, there is an opportunity through having stronger unions now to stop the drift to the Americanisation of our society. What would this mean?

In industrial relations, it would mean employers positively welcoming union involvement in the running of companies and organisations. Economically, unions would legitimately play a major role in distributing the fruits of workers’ labour to all workers. Politically, as the largest voluntary membership organisations, unions would be able to participate in the modern version “of beer and sandwiches” in Downing Street without ever being accused of parking their tanks on the lawns of No10 and No11.

For Scotland, with its deep-rooted traditions of workplace and political collectivism, the Scottish Trades Union Congress (STUC) would become again what it was in the past, namely, an influential, legitimate and respected part of the way that society in Scotland works.

Whether under an enhanced form of devolution or under independence, the STUC would become a genuine social partner, consulted on existing government proposals. But more than that, it would also become a fashioner of its own proposals for government policy and be able to negotiate on government proposals.

On the economic front, some real substance would be put behind the long-standing notion of a “smart, successful Scotland”. Accordingly, the hi-tech road would see state-sponsored and regulated investment in the industrial technologies of the future, so that the economy became a high-wage, high-skill and high-productivity economy.

Collective bargaining over wages and conditions at the society level – or its various sectoral components – would allow wages to be taken out of competition between different companies, so they would compete on the quality of goods and services and not on price. This would mean there was no incentive for firms to undercut each other on the wages front. Organisational and gender wage inequality could be easily dealt with under this system of a co-ordinated market economy.

Of course, such a scenario or outcome would send some into apoplexy, loudly shouting about flights of capital out of Scotland, the killing of entrepreneurship and the end of civilisation as we know it. But this would merely testify to the protection of their own vested interests and the bankruptcy of their [neo-liberal] ideas that led us into the mess we are all currently enduring.

To think that unions are part of the problem and not the solution is to not see the wood for the trees. Pay leapfrogging and wage drift and the like did not cause the crisis last time around. They were the symptoms, not the causes. Even more obviously, unions did not cause the crisis this time around.

As the building worker and, in 1972, jailed Shrewsbury flying picket but now famous actor, Ricky Tomlinson, would say to such nonsense: “My arse”.

The question for our times is whether under devo-max or independence, there is the foresight amongst the movers and shakers in our society to put Scotland on the path to economic stability and social justice and by allowing unions back into the political fold.

• Gregor Gall is professor of industrial relations at the University of Hertfordshire ([email protected])