New U.S. Export: Union-Busting

In the United States we do not bump off union leaders. No, we are somewhat more humane. We let professional teams of lawyers, management consultants, psychologists, and others subvert union leaders and their organizations through sophisticated techniques of union-busting.

Pardon me. They call it union avoidance. Either way, its practitioners collect an estimated $4,000,000,000 a year from employers to keep unions out of work places and to remove those already there, all by using activities that are legal, quasi-legal, and extra-legal, as well as illegal. They can resort to illegal practices because the penalties are so minimal.

So great is their success in the United States that the union busters are expanding their operations off shore, particularly to the United Kingdom. That troubles the British Trades Union Congress (TUC), the national labor union center that partners with the AFL-CIO. On February 12 leaders of the two national centers formalized an agreement to work together to counter this transatlantic anti-union offensive.

Brendan Barber, TUC general secretary, explains: “The underhanded tactics employed in the shadowy world of the union-busting consultant are improving increasingly attractive to a handful employers in the UK.”

“Union Avoidance Consultants: a Threat to the Rights of British Workers,” a study by John Logan, of the London School of Management, was released to coincide with the new cooperation. Logan writes that the overwhelming majority of employers in the United States hire outside consultants when they are faced with an employee move to organize.

Among their techniques, these outsiders:

• Caution workers not to trust unions: unions "get between” management and its employees.
• Concentrate on spreading fear in employee ranks, charging that unions are corrupt and interested only in dues, that jobs aren’t safe under a union, that unions can’t require the boss to give a pay increase, that benefits including vacations and insurance are in peril, and so on and on, in every possible variation.
• Take full advantage of the legalized monopoly that they and the employer have in workplace communication with employees, including compulsory meetings and one-on-one interviews designed to put full pressure on individuals.

At present, such activity in the UK is much smaller in scale and intensity than in the United States. Yet, as Logan says, the new export development should still be worrisome to “anyone who believes in the workers’ right to organize and bargain collectively.”

Let me expand on that point. Such activity should worry anyone anywhere who believes in a free society. Unions in the United States, Europe, Japan, and elsewhere have proven their value in acting as a cushion between the individual and the state. Along with other private organizations, including business firms, labor unions build and maintain a living social structure – a vigorous civil society – that creates limits on the power of government and performs many necessary economic and social functions more closely to the people than the government can.

If more Americans understood the need for a flourishing civil society, union-busters would drastically lose their effectiveness. As things are, exterminating unions is an occupation widely seen by professional peers and many others as legitimate, not one to be shunned, scorned, and shamed.

Chances are not great that the new U.S.-UK initiative will bring an end to what Business Week has called “one of the most successful anti-union wars ever.” But it must be tried, in hopes that other groups of this democratic nation, including at least a few leading employers, will join it.

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But -- do workers still want unions?

If you’re wondering, read the report, “Do Workers Still Want Unions? More Than Ever,” published by the Economic Policy Institute. The author, economist Richard B. Freeman, compiles 16 pages of evidence that they do.

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Reform Global Investment Rules!

That slogan, or a zippy version of it, may well pop up in the speeches of Democratic candidates for President. Here’s why.

A big reason for the public’s suspicion of globalization is that its governing rules and procedures are mysterious to almost everyone, except for a select group of insiders. Few of those rules and procedures are more mysterious than the ones governing cross-border investments, even as international agreements protecting them have multiplied at a pace almost as rapid as foreign investments themselves.

Now some countries and international NGOs are demanding a simple reform to help demystify the process of protecting foreign investment. They want transparency in how international tribunals make decisions in disputes between foreign investors and the countries in which they invest. The issue is highly sensitive because current intergovernmental agreements on investments are generally one-sided -– they contain a series of rights for inward capital, but they lack any counter-balancing investor responsibilities.

This imbalance is a serious flaw in the 15-year-old North American Free Trade Agreement (NAFTA), and is at the root of some U.S. labor and NGO attacks on its Chapter 11, which grants U.S. and other foreign investors rights in Mexico without commensurate responsibilities. This lop-sided protection, which the U.S. has duplicated in other free trade agreements, has not surfaced as an issue in the U.S. Presidential contest, but may if Hillary Clinton and Barrack Obama are asked for details explaining why they say NAFTA needs to be reformed.

Meantime, some developing countries, joined by two international NGOs and some developing countries that have been bitten by expensive lawsuits under Chapter 11, are seeking change in one contentious area of the larger problem. They are pressing for a partial reform in rules to make transparency a requirement in all arbitrations filed by private foreign investors against states. In early February, however, this initiative was rebuffed by a UN Working Group charged with revising a key set of international arbitration rules.

If you have gotten this far, bravo. There’s more.

This is not a riveting issue. No wonder, then, that you haven’t seen or heard anything in the media about it, not even about the February 15 joint press statement released by the two international NGOs, the Center for International Environmental Law and the International Institute for Sustainable Development. But bear with me, please.

John Ruggie, UN Special Representative to the Secretary General, recently summarized what is at stake: “Adequate transparency where human rights and other state responsibilities are concerned is essential if publics are to be aware of proceedings that may affect public interest. Indeed, transparency lies at the very foundation of what the United Nations and other authoritative entities have been promulgating on the precepts of good governance.”

The joint press release, besides quoting Ruggie’s words, has a lengthy explanation of the issues involved and how a transparency reform, though delayed, might still be adopted:

Under regulations laid down in free trade and investment pacts, foreign investors have the right to bypass local courts and bring disputes with the host state to international arbitration. Even when these disputes raise crucial public interest issues -- impacts of failed water privatizations, financial crises in developing countries, and environmental and health regulations, for example -- arbitrators are able to hide their work behind a veil of secrecy. Thus, interested citizens, NGOs, and other governments are kept ignorant about decisions affecting them.

A Working Group of the UN Commission on International Trade Law (UNCITRAL), which is responsible for a key set of rules governing these arbitrations and is currently revising them, has so far blocked inclusion of transparency provisions in the revision. But the question has now moved from the Working Group to the UNCITRAL Commission itself, which meets in June at the UN headquarters in New York

By airing the issues publicly now, the two NGOs, IISD, headquartered in Canada, and CIEL, headquartered in Washington, are hoping that their arguments will persuade the UN Commission on International Trade Law to decide in favor of sunshine.
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Is there any likelihood of awakening public interest in this issue? Read on.

The present UN arbitration rules, dating since 1976, do not distinguish between private commercial arbitrations and those between a state and foreign investors and thereby apply the same secrecy rules to both. But the public interest element in investor-state disputes requires transparency, as argued in a 17-page study by IISD and CIEL.

Also enlightening, and on a wide range of foreign investment issues, is an IISD publication on “Why Elected Officials Need To Pay Attention to International Investment Agreements.” Trade union leaders and their staffs also need to pay attention.

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Personal Reflections on the Holocaust

I try to read something on the Holocaust each year during Lent. Two books I read in past years were “Hitler’s Willing Executioners: Ordinary Germans and the Holocaust” by Daniel Jonah Goldenhagen and “Nazi Terror: The Gestapo, Jews, and Ordinary Germans.” This year I re-read a long magazine article by Dr. Sherwin B. Nuland about his two-day visit in 2004 to the U.S. Holocaust Memorial Museum in Washington, D.C.

Nuland, professor of clinical surgery at Yale School of Medicine, found the Museum “a place to learn, to look within oneself, and to ponder the nature of our shared humanity.” In addition, because he was there during an extraordinary exhibition on ”Deadly Medicine: Creating the Master Race,” he reflected much about his personal responsibilities as a doctor, and especially about how he might have acted had he been practicing in Germany during the Nazi years:

“It had always seemed obvious to me, and to the several colleagues with whom I discussed it over the years, that none of us would ever have fallen prey to such delusions as the justification of euthanasia and genocide.”

After “Deadly Medicine’ he was no longer so sure. He now feared he may have been swept along by each of the eugenics movement’s “small steps” that, at least in the early stages, did not appear dangerous, and were supported by “highly regarded scientists.”

Nuland’s self-examination shook him deeply. In The New Republic of September 13/20, 2004, he wrote: “To my startled dismay, I found myself understanding why much of the German medical establishment acted as it did. I realized that, given the circumstances, I might have done the same.”

The “Deadly Medicine” exhibit, and Nuland’s eight-page review, traced how the international eugenics movement – its dedication to improving the “purity of the human race by better breeding” – led to Hitler’s program of “ridding Germany and eventually Europe of the pestilential disease of Judaism.” Under medical science’s stamp of approval, “who but a few visionaries would see any danger in the promotion of purity?”

Nuland’s own profession cooperated widely and willingly with the Holocaust: “No association or guild was more complicit in the rise of Nazism and the desecrations committed by its leaders and followers than the profession of medicine, in the form both of its organizations and its members.”

How could this happen to members of such a noble profession? Among other reasons: “their failure to recognize a basic fact about the scientific enterprise...Neither medicine nor science itself derives its ‘truths’ in the thoroughly detached atmosphere in which its practitioners would like to believe they work…There is no such thing as a thoroughly detached scientific undertaking.”

Reflecting on the Holocaust is for me, too, a moving experience. If my father, an ethnic German, had not migrated to the United States, I might have lived through the days of Nazi rule.

• Would I have been among the multitudes of Germans, young and old, who (as you can see in TV documentaries) marched in Nazi parades and saluted in Nazi rallies? No, I tell myself.
  
• Would I have played a role in the extermination of Jews? No. No, I would not betrayed my Jewish neighbors or taken any action against them.
  
• But would I have raised my voice in protest? Would I have done anything, anything at all, to stop the carnage? On that I am...not sure.
  

That thought disturbs me. It stems from an honest self-appraisal of the kind that Lent calls for. And it leads to a prayerful reaffirmation to dedicating myself to the cause of human rights for all.
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Corporate Social Irresponsibility

Corporate Social Responsibility passed a milepost of sorts three years ago. That was when the Economist found that CSR had gained enough support to qualify as a movement, though one without much depth beyond the level of ideas. As the news weekly wrote in its January 22, 2005, issue, for most companies “CSR is little more than a cosmetic treatment…[which] goes on each morning, gets increasingly smeared by day and washes off at night.”

Its judgment in 18 pages on ”The Good Company” was clear: “Better that CSR be undertaken as a cosmetic exercise than as a serious surgery to fix what doesn’t need fixing….It is important to resist the success of the CSR.”

Well, the Economist has just taken a new look at that movement, and finds not only that “CSR is booming” but that it “is now seen as mainstream.” On balance, the 13-page analysis in this year’s January 19 issue is more positive than negative about CSR. Indeed, some sections of the report amount to rationales for CSR, often under other labels, such as “risk management,” “enlightened self-interest,” and “just good business.”

Perhaps the most significant finding of the report is the fact that “the biggest problem that many companies have to deal with is something that has sprung from globalization”: specifically, the risks connected with managing the global production and distribution chain that stretches across the world. Nike, with some 800,000 workers in its contractor and subcontractor network, is among the firms with “a challenge on a grand scale.”

Why? Because:

“Firms can set standards of behavior for suppliers, but they do not find it easy to enforce them. Unscrupulous suppliers may cheat, keeping two sets of records, one for show, one for real. Others, under intense pressure to keep costs low, may cut corners – allowing unpaid overtime, for example, subcontracting work to other firms that escape scrutiny….

“Basic as it sounds, even many big companies fail to [monitor risk across the supply chain]: 60 percent of the 2,000 large companies surveyed recently…said they did not require suppliers to enforce a code of conduct.”

A point that follows from such facts – a point that the Economist does not make -- is that the biggest problem for global companies is also the biggest failure of CSR and its codes of conduct.

The Economist notes and applauds an attitudinal change a growing number of firms and NGOs: it leads them to work together in formal or informal partnerships. “Both sides now see CSR as offering…benefits for both business and society.” But does it, really? The supporting evidence is mighty skimpy.

Consider the vast resources poured into CSR activities in the past two decades, from the UN Global Compact on down. Where are the results? Results, that is, measured in changes where people work and live, rather than in the huge increase in CSR professionals on payrolls and in training. This report has amazingly little to say about problems that CSR has solved.

Could it be that CSR has actually slowed down progress toward solving the burgeoning problems of globalization?

After all, CSR tools such as seminars and codes of conduct can, and do, lull people into complacency by creating a false impression that something real is happening – that global sweatshops are under control, that NGOs need no longer run campaigns to expose them, that the media need no longer publicize them, that public protests against them have become unnecessary. Isn’t CSR catching on even in China? Only a few months ago 13 foreign and domestic companies met in Shanghai to launch the Chinese Federation for Corporate Social Responsibility.

The truth is that human progress often requires measured militancy. The civil rights movement required it. So did the women’s rights movement. And so does the corporate social responsibility movement.

From my own limited contact with the corporate world, even in pre-CSR days, I know that there are some executives who want to do what is right and just but are, or think they are, hemmed in by the culture of their firm or industry. They themselves don’t sign petitions or carry placards in demonstrations, but they need those who do. Students, ministers, workers, and others who agitate for change are the allies of a genuine movement for corporate social responsibility. Without them, CSR is an occupation expanded into a bureaucracy.

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An article of mine, “Corporate Social Responsibility: A Fledgling Movement Faces a Crucial Test,” appeared in the Winter 2007 issue of Dissent. The “crucial test” for CSR was – and is -- whether it would support a redirection of U.S trade and investment policy to make it worker-friendly.
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