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 II – The Global Employer
If you were born and raised in Northeastern Ontario as I was, you will be very familiar with the corporate giants in our region, especially in the mining and steel sector. Three companies, Inco, Falconbridge and Algoma Steel where clearly the economic engine along the Highway17 corridor from the Quebec border to Wawa and beyond. They were responsible for thousands of jobs in the region through both direct and indirect employment. Most of these jobs were union jobs, good union jobs.
For the most part these companies were Canadian owned or controlled. However in the middle of the last decade the ownership of these three companies shifted into foreign hands. Given the given pro-business shift in the Canadian political landscape resulting from consecutive governments lust for economic globalization, this takeover of Northeast Ontario’s big three should come as no surprise. It was just a matter of time before the new global market place would create the conditions where these multi-national giant could swoop in and claim these companies for less than market value. But more importantly they gained control of the natural resources that went with them for perpetuity. So what we are left with is foreign ownership and control of our natural resources which essentially means that the foundation for our economic existence in our region for decades is no longer in Canadian control. We are victims of a corporate invasion of unparalleled proportion and we literally surrendered our part of the country and our resources without a shot being fired. Sadly not only did our government let it happen, they actively enabled it.
So just who are these corporate invaders? Although they come from very different origins, they are very similar in structure, approach and results. All three have diverse international holdings that include shipping, electricity production, logistics, mobile networks, mining, steel production, paper and many other ventures. Each employs between 52,000 and 62,000 people around the world. Their combined revenue is nearly $70 billion U.S. These three conglomerates, Xstrata, Essar and Vale are corporate juggernauts on the world stage that have landed in Canada and now they are playing for keeps.
The first to arrive was Xstrata in August 2005. They Xstrata purchased a 19.9% stake in Falconbridge Limited that included holdings in Sudbury and Timmins, Following a contested take-over battle with Inco Limited, Xstrata successfully acquired the remaining 80.1% of Falconbridge in August 2006. With its headquarters are in Zug in Switzerland, Xstrata Copper is currently the world’s fourth largest producer of copper. Although their approach to collective bargaining in Canada is yet to be seen, there is little doubt that they are watching the situation at Vale Inco with great interest. If Vale succeeds in achieving its desired outcome in the current round of negotiations, you can be sure that Xstrata will follow their established pattern.
Xstrata is no innocent though. They announced January 11, 2010 that they would permanently cease operation of its copper and zinc metallurgical plants at the Kidd Metallurgical Site in Timmins on May 1, 2010 putting 670 people out of work. They plan to send the work currently done in Timmins to Rouyn-Noranda, Quebec. Some reports indicate that they have not honoured the current collective agreement by ignoring seniority provisions. This closure is viewed by many in organized labour as a direct attack on the union. This company also in hot water in Australia where they want to divert a river that is a revered fishery to create a new open pit mine.
In 2007, Essar Steel acquired Algoma Steel in Canada with a staffing compliment of about 5000 employees. The Essar Group is a multinational conglomerate corporation headquartered at Mumbai, India. In the same year they purchased Algoma, they increased their presence in North America with the purchase of Minnesota Steel in the United States. In August 2007, Essar successfully negotiated their first collective agreement with United Steelworkers, for their Algoma Operation, which is said to include general improvements to salaries and benefits. However, if Vale Inco is successful in breaking Steelworkers in Sudbury, it is reasonable to believe Essar will be much more aggressive in the next round of bargaining.
Vale Inco (formerly CVRD Inco) is a wholly owned subsidiary of a Brazilian mining company. Vale S.A. formerly Companhia Vale do Rio Doce (CVRD), it is a diversified mining multinational corporation and one of the largest logistics operators in Brazil. It is the second-largest mining company in the world and according to their President and CEO Tito Martins; their ambition is to quickly become number. Of course being number one is determined by revenue and profitability. Obviously increasing profitability of current properties, like their operations in Sudbury, moves them closer to their goal of being on top. It makes sense that this is part of an overall strategy to achieve that number one status. Strangely, with the price of nickel at record levels the Sudbury operation is profitable; just not profitable enough for this corporation and its investors.
With its worldwide holdings, diverse investments and revenue streams along with a huge critical mass of assets, Vale Inco is a corporate beast the likes of which trade unions have never faced in our country. They have deep pockets, unfettered ambition and a killer instinct that is void of any social responsibility or moral compass. It is a corporation that was born in a part of the world where union activists are viewed as insurgents who are a threat to capitalism. They view workers as easily replaceable commodities that should be should be purchased for the lowest possible price. Sustainability and community are seemingly absent from their vocabulary. Viability and profitability are essential to their existence.
Sadly, the current business climate in Canada is not only inviting to predatory employers like Vale, but conditions, especially in Northern Ontario, are like the perfect storm for economic exploitation and capitalist dominance. We have a region that historically faced economic struggles that come with the boom and bust cycle of a resource based economy. The global financial crisis, with its “take no prisoners” impact, only magnifies our vulnerability. While corporate executives and CEOs enjoy unprecedented wealth regardless of what is indicated on the balance sheet, middle class workers see their personal fortune erode beneath them. This new world economy can drive down earnings so that it now feels like a race to the bottom. The socialist ideal of shared wealth, prosperity and global economic equality has not only been impeded by these neo capitalist, they are turning the tables to the point, that if not stopped, the working middle class could be headed for annihilation.
So to summarize, we have a resources based economy that is struggling and in need of investment capital to compete in the world market place. So in walks a multinational conglomerate with to rescue us with empty promises of a second chance to prosper in this new world economy by way of corporate takeovers. All this is made easier because we have had successive governments that have battered our national interest through deregulation and removal of trade barriers to the point where our sovereignty is at risk. The repeal pro labour laws like anti-scab legislation have tilted the bargaining table solidly in favour of the employer who have little or no accountability. Furthermore when this employer has seemingly unlimited financial resources from diverse international portfolios and no stake or interest in your community other than unrestricted access to profits, what you are left with is a recipe for a battle of epic proportions between a working class fighting for way of life that has taken over a century to build and multinational corporate monster whose values are driven by greed and profits regardless of the human cost.
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