US workers can breathe easier. The wholesale destruction of their living standards, benefits, and wages, coupled with a dramatic increase in the rate of exploitation over the last decade is paying dividends. But not dividends for them.
Recently Caterpillar Inc locked out its Canadian workers in London, Ontario, contending that the workers need to cut their pay dramatically. They point to the fact that Caterpillar pays its workers 50% less in Lagrange, Illinois. Quoting The Wall Street Journal (US: A Cheaper Labor Pool 1-6-2012): “…[B]ut instead of pointing to the usual models of cheap and pliant labor, such as China and Mexico, it is using a more surprising example: the US.”
So the tables are turning and today we find that US workers are setting miserable standards of pay and benefits against their Canadian and European counterparts. They, in turn, could repeat the same sad misguided tactic popular in the US by blaming poorly paid “foreigners” – in this case US workers or their government’s policies -- for the pressure on their living standards. US hourly compensation costs in manufacturing rose only 39% over the last decade, while average comparable labor costs grew by 74% in OECD countries and 91% in Canada.
Put differently, labor costs per unit of output in the US are 13% less than they were in manufacturing a decade earlier. In Germany they rose 2.3%, the Republic of Korea 15%, and Canada 18%. These figures are most telling because they reflect—assuming roughly similar levels of productive force development – differences in the relative rates of exploitation. Clearly US workers have surrendered far more than their international brothers and sisters while being squeezed much harder in the work place.
Instead of the divisive and diversionary tactic of blaming foreign governments or foreign workers for job losses or pay cuts – typically China – it’s time to target the trans-national corporations that exploit labor cost differentials to increase profits. Like the machine-breakers of yore, workers and their trade union leaders must correctly identify the enemy and embrace class struggle unionism if they have any hope of stopping this destructive game of competition to see who can offer the best wage deal to rapacious corporations.
