Labour standards and the WTO: Counter-hegemonic struggle against Neoliberalism?

Table of contents

1. introduction

2. theory: neo-gramscian perspectives

3. background
3.1 World order
3.2 Singapore Ministerial Conference
3.3 The organizational structure of the labor movement
3.4 Reasons for labor's involvement with the WTO

4. Analysis
4.1 Fragmentation of the labor movement
4.2 Division of working class: nationalist tendencies
4.3 Neoliberal and capital dominance in the WTO

5. conclusion

Bibliography

Statutory Declaration

Introduction

The debate about a linkage of workers rights and trade that has flamed up since the 1990s has its roots in the nineteenth century when industries were afraid that a development of domestic labor standards would harm their competitive advantage. These recurring concerns eventually led to the establishment of the International Labor Organization (ILO) in 1919, a tripartite organization in the United Nations system which sets international labor standards but has to rely on moral consensus without a binding enforcement mechanism (Hoekman / Kostecki 2001: 448). While the ILO has set up numerous conventions on labor rights, the establishment of the World Trade Organization (WTO) in 1995 provided a legal framework in which labor rights, if they were introduced, could be effectively enforced for the first time.

While most of the debates over the possible linkage of trade and labor standards focuses on questions of competitiveness and possible outcomes for WTO member states (Hoekman / Kostecki 2001: 449f.), this paper takes a different, a critical perspective and looks at the social forces which are struggling for and against such a social clause. Social forces are groups of people whose place in the global economy is determined by their place in the organization of production (O’Brien / Williams 2004: 31). The struggle for a social regulation of labor markets by the labor movement is part of a broader struggle against the drawbacks of the neoliberal order of the global economy. The rise of other forces opposed to the current order has created the opportunity to form a rival bloc powerful enough to be recognized by the dominant forces and eventually have their interest realized. However, this would only be possible if the rival bloc has a certain coherence and consistence in its aims. This is what I will try to examine in this paper. Is there an incoherence and inconsistence in the labor movement that has prevented a greater impact on the linkage of trade and labor standards in the WTO? What are the different currents within the movement and how can they be explained from the historical background and the organization of the global production? How relevant are the different groups for the whole labor movement?

I will use a neo-Gramscian approach for several reasons. The first is obviously the nature of the actors I take into account. By focusing on social forces I reject the image of nation-states as the sole relevant actors in international relations. I rather assume that the decisions and actions of states are dependent on the social forces that constitute them. No state can act in a matter contrary to the majority of its constituency for long. “A neo-Gramscian approach forces us to widen our focus beyond the diplomats who are formally engaged in negotiations to include the struggles taking place among competing social forces over the principles, norms, rules and procedures of the international regime” (Gale 1998: 277).

Second, I do not take neoliberalism as a universal theory that can be applied at all times but as the ideology of a particular historical situation. Also, I assume that international institutions serve the interests of the groups that have put them into being. This is not the topic of this paper but I do not assume that free trade and investment have benefited everybody but that they have led to a widened gap between rich and poor both within and between countries. I use a critical approach because I think that globalization is not an unavoidable and irreversible process.

This paper tries to determine causes for the only limited impact of labor movement. First, I will outline the neo-Gramscian approach to International Political Economy with its central concepts of hegemony and counter-hegemony. From a neo-Gramscian perspective, the labor movement is regarded as a counter-hegemonic project which tries to change the hegemonic institution WTO to its advantage. I will show that the need for a social clause arose from tensions within the neoliberal order. In the analysis, the focus will be on the thesis that the labor movement itself is too divided and therefore does not represent a uniform strategy which would be necessary for the building of counter-hegemony. More particularly, a deep division runs between North and South. I will set up the thesis that the perception of an antagonism between Northern and Southern interests is further fueled by nationalist populist movements in developed countries, which themselves have their origins the neoliberal mode of production. The Singapore Ministerial Conference of the WTO in 1996 is the background for discussion because the introduction of labor issues rejected then and further attempts to revive the debate have not led to other results yet^[1]. The dominance of neoliberalism and the social forces of capital will be overviewed in short because they benefit from the current absence of labor standards and therefore oppose the counter-hegemonic movement. The results will be summarized in the conclusion chapter.

Theory: Neo-Gramscian perspectives

The neo-Gramscian approach belongs to the critical theories in International Political Economy. The mainstream or problem-solving theories take the social world, the social relations and institutions as given parameters for action and try to determine and eliminate sources of trouble. The fixed parameters enable theorists to formulate general laws which are not bound to a specific historical background (Cox 1996 [1981]: 88f.). Conversely, critical theory assumes that “theory is always for someone and for some purpose” (Cox 1996 [1981]: 87). The world order is not given but depends on the perspective that is taken; it is not a value-free object. The aim of critical theory is to find out how the order was achieved and if sources of conflict within the prevailing order can lead to structural change and the emergence of a different order. Specifically, critical theory is normative and looking for a better order (O’Brien / Williams 2004: 32). Unlike problem-solving theory which focuses on particular issues, critical theory wants to understand the whole system and processes of its change (Cox 1996 [1981]: 89).

Neo-Gramscian perspectives are based on the writings of the Italian Marxist Antonio Gramsci^[2] which were refined mostly by Robert Cox in the 1980s. They are also called historical materialist because they reject the universality of social laws and emphasis that ideas, institutions, etc. are attached to a specific historical situation. They are “materialist” because the focus is on the modes of production and the thereby engendered social relations and forces (O’Brien / Williams 2004: 30f.)

Gramsci’s concept of hegemony is situated on the national level and explains how a dominant class can establish a stable hegemony without the threat of force by convincing subordinate classes that they share the same aim and work towards a general interest. Hegemony is a consent between the ruling and the subordinate classes which is the result of struggles during which the dominant class makes concessions. When the consent of the different social groups – the hegemony – is established, its hegemonic norms or ideology are affirmed and proliferated by institutions: “Institutions provide the opportunity for dominant social forces to soften their social domination through the buying off of subordinate forces, thus strengthening their hold through a process of consensus building” (Sinclair 1996: 11). The integration of differing class interests, the particular configuration of social forces is labeled as a historical bloc (Bieler / Morton 2003: 346).

Cox transferred this concept to the international level. His frameworks for action are historical structures which are the result of a particular configuration of three kinds of forces: material capabilities, ideas and institutions. Though the historical structure does not directly determine an outcome, it affects the action of individuals and groups (Cox 1996 [1981]: 97f.). Groups can successfully resist the dominant historical structure, and thereby make change possible by building of a rival structure (Cox 1996 [1981]: 98).

Cox identifies three kinds of social forces. Material capabilities include dynamic forms such as technological potential as well as accumulated forms like natural resources, equipment and wealth. Ideas are divided in intersubjective meanings and collective images of social order. While intersubjective meanings are notions about social relations shared by all society members for a long period of time– the “specification of the common sense of an epoch” (Cox cit. in: Sinclair 1996: 9), rivaling social groups have differing collective images of social order. Institutions reflect and stabilize a particular order by supporting the collective image of the dominant social force. They can possibly “take their own life; they can become the battleground of opposing tendencies, or rival institutions may reflect different tendencies” (Cox 1996 [1981]: 99). When forces with rival collective images possess the material capabilities, they can either alter the existing institutions or create new ones.

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^[1] Also, most literature about the topic focuses on the Singapore conference.

^[2] Antonio Gramsci (1891-1937) was an activist in the Italian radical labor movement and a founding father of the Italian communist party (Bieler / Morton 2003: 338f.).