Why Can’t Steel Get a Deal with the Stinkos’ at Vale INCO?

This is the first in a series of blogs examining some of the underlying factors contributing to the stalemate in bargaining between United Steelworkers and multi-national giant Vale Inco.

More than 3,000 Steelworkers in Greater Sudbury and Port Colborne have been on strike since July 13, 2009 in a dispute over pensions, the nickel price bonus and transfer rights. More than 200 Steelworkers in Voisey's Bay, N.L., have been on strike since August 1, 2009 over similar issues. Why has this strike gone one so long?

What is at the heart of this historic labour dispute? In my view there are a number of contributing factors why this strike is continuing with no end in the foreseeable future. For instance, we have a new breed of predatory global employer who places profits ahead of community and social responsibility. We also are seeing the failure of the provincial and federal governments to protect our natural resources and collective bargaining rights of Canadian workers. These factors along with many others are responsible for one of the most acrimonious labour disputes in the past in the past 50 year. It merits our examination.

Part 1 - Political History

How did we get to the point where a foreign company could walk into our country and bully unionized workers and hold entire communities hostage while the politicians who are supposed to protect our interest sit on their hands. This tale actually starts many decades ago, but let’s begin with the election of Ronald Reagan in 1980.

The election of Reagan as the 40th President of the United States signalled the beginning for a new era of world politics where “free trade” and “deregulation” were the political buzz words. The time was right for the neo-con right wing agenda to take hold and flourish. Oil and gas shortages, double digit interest rates and world events like the US hostage taking in Iran left the western world looking for a messiah. Unfortunately this messiah came in the form of a former Hollywood actor who embraced right wing ideology and less government.

Reagan quickly took charge and used American muscle to reshape the political landscape in the US and abroad. He bulldozed through anyone standing in his way. When striking US Air Traffic Controllers refused to heed his order to return to work early in his administration, he simply fired all 11,000 of them and busted the union. On the world stage, he would not be compromised and it was his way or no way. A world thirsty for change, was quickly enthralled with his style, strength and obsession with putting more money in the hands of the rich through tax cuts.

He soon had political allies in Britain’s Prime Minister Margaret Thatcher and Canada’s Brian Mulroney, both of whom were staunch conservatives. Thus the stage was set for the pro-business deregulation and unfettered trade which was intended to create a “business friendly environment”. In the wake of this political shift to the right; public services, social programs and public spending was cut to make way for huge corporate tax cuts which were an essential part of right’s trickle down economic scheme. The momentum generated by this era would allow this political shift to continue for the better part of two decades and in Canada it left us with the North American Free Trade Agreement (NAFTA) and the GST, a regressive consumption tax that provided the government with required revenue to implement further cuts corporate taxes.
So where was the political left while Reagan and friends were taking down this road to unregulated disaster? In Canada we had a socialist presence in the form of the New Democratic Party (NDP) and an effective labour movement so the swing to the right was slowed but not stopped. Unfortunately similar resistance was not as prevalent in the United State where industrial heartland there was being marginalized and the union activist base was quickly declining as industrial jobs in steel making and manufacturing evaporated as result of globalization.

Two events occurred at the start of the new millennium are examples of that demonstrate the polarized political struggle between the right and left wing. The first was the Protest activity surrounding the WTO Ministerial Conference November 1999, that was to be the launch of a new millennial round of trade negotiations when the World Trade Organization (WTO) convened at the Washington State Convention and Trade Center in Seattle, Washington. The negotiations were quickly overshadowed by massive and controversial street protests outside the hotels and the Washington State Convention and Trade Center, in what became the second phase of the anti-globalization movement in the United States. The scale of the demonstrations—even the lowest estimates put the crowd at over 40,000—dwarfed any previous demonstration in the United States against a world meeting of any of the organizations generally associated with economic globalization. The Battle in Seattle was one of the first significant clashes between right and left wing ideologies on the issue of globalization. It was also the first clear warning from the political left on the evils and disastrous potential of economic globalization or unfettered free trade.

A similar experience was had in Canada with the 3rd Summit of the Americas that was held in Quebec City on the weekend of April 20, 2001. This international meeting was a round of negotiations regarding a proposed Free Trade Area of the Americas. The talks are perhaps better known for the security preparations and demonstrations (known as the Quebec City protest) that surrounded them than for the progress of the negotiations. Once again the resistance from the left signalled the danger of perpetuating globalization. Unfortunately, the move to economic globalization was on slowed and not stopped. Consequently the Canadian landscape became ripe for the likes of predatory global corporations like Vale Inco.

In the thirty years since Reagan became the American President, successive US and Canadian governments continued to down the same path of removing trade barriers and deregulation that allows the ongoing erosion of safeguards intended to protect our social fabric and national interest. Additionally, the federal and provincial governments in Canada have slowly adopted pro-business and/or anti-labour policies. The most obvious example is the abolition of anti-scab legislation by Ontario’s Harris Government in the 1990s. Another is the ongoing threat to privatize our public health care system to bring us in line with other industrialized nations. All of this has left us with a playing field that is seriously tilting toward business.

To be a player in the “new world” economy, our nation signed away our ability to regulate foreign investment, protect ourselves from foreign control of our natural resources and national industrial icons like INCO. So now once a multinational corporation gains entry into Canada, we are powerless to impose our will without feeling the wrath of G20 partners and world trade organization. Because of free trade agreements, our country is now loathe to respond to international corporate bullies who set up shop in Canada. So no matter what happens in the current Steelworkers strike, don’t expect any action or help from any government currently sitting in Canada as they are willing accomplices in creating this anti-labour climate. That’s because a strong labour movement is all that stands between them and bigger profits.

Next we'll look at "The Employer"

ISE