Australia: Telstra to destroy 10,000 contract jobs over two years

Oscar Grenfell

Telstra, Australia’s largest telecommunications company, announced last Tuesday that it will eliminate 10,000 contract positions over the next two years. This follows its unveiling in June last year of a plan to destroy 9,500 permanent jobs by 2022.

The company has claimed that it will hire an additional 1,500 workers, meaning that the net reduction of permanent positions would be 8,000. It is likely, however, that many of the new employees will be based overseas, enabling Telstra to pay poverty-level wages and further slash labour costs.

The mass sacking, involving the rapid scrapping of almost 19,500 jobs, is the largest in Australian corporate history. It is part of an offensive, being enforced by state and federal governments, Labor and Liberal-National Coalition alike, and the corporatised trade unions, against the jobs, wages and conditions of workers across the country.

In Tuesday’s announcement, Telstra chief executive Andrew Penn signaled that the contract positions would be rapidly eliminated. “Given the uncertainty this creates I have therefore been keen to get most of the changes and most of the reductions behind us as quickly as possible,” he said.

Penn touted an “extensive program of support” that is supposedly in place for the workers who lose their jobs. When it announced its restructure in June 2018, Telstra stated that it would establish a “transition program” to “assist” sacked workers, but funding is a paltry $50 million.

Contractors, moreover, do not have even the limited rights of permanent employees. They often lack basic entitlements, including long-service leave and holiday pay, and will not receive redundancy payments on a par with permanent workers.

In a separate announcement late last month, Telstra signalled that it would destroy 6,000 of the permanent positions to be abolished by the end of June.

The company has already sacked 4,700 workers since June 2018, and will eliminate another 1,300 jobs over the coming weeks. The sackings thus far have reportedly hit office workers and call centre operators, along with some staff in frontline customer service roles.

Penn has also flagged further job cuts over the coming period, in addition to those that have already been announced.

The far-reaching restructure has only been able to proceed as a result of the support of the trade unions, which have suppressed any opposition from workers and sought to ensure an “orderly” retrenchment of jobs.

Community and Public Sector Union (CPSU) Deputy National President Brooke Muscat complained that the latest job cuts showed a “lack of strategic focus.” “Instead of being ready for our digital future, they are flailing,” she said.

Other union officials have made similar comments but have no fundamental opposition to the restructure and huge job losses.

In June last year, for instance, Alex Jansen, the New South Wales state secretary of the Communication Workers Union, condemned Telstra for allegedly failing to inform the unions of the sackings before they were publicly announced.

Last year CPSU Deputy National President Rupert Evans promoted the illusion that Telstra could be pressured to provide the “skills and training employees need to shift into new role.”

Since then, the unions have called no strikes or taken any action to oppose the layoffs. Instead they initiated a petition, and have directed workers to make futile appeals to the federal Coalition government and the Labor opposition to come to their aid.

In negotiations for a new enterprise agreement covering some Telstra workers, the Communications Electrical Plumbing Union has barely mentioned the job cuts. Instead they have called for a pitiful 12 percent pay rise over three years and organised a handful of isolated stoppages and token work bans.

The union is helping Telstra to carry out a sweeping overhaul of its entire business, under a plan dubbed “Telstra22.” The company is writing off $500 million worth of back-office equipment and seeking to digitise its customer service and management operations. Telstra is also splitting its retail and infrastructure activities, in an attempt to boost share prices.

The restructure is partly motivated by intensifying competition within the telecommunications sector, resulting from the emergence of digital technologies that undermine existing business models. Telstra and its chief rival, Optus, have been competing for dominance of the new 5G market to be rolled out over coming years. Last December, Telstra announced that it was beginning to trial a new 5G network.

The sackings at Telstra are part of a broader corporate offensive against jobs, including in “white collar” industries. In December 2017, the National Australia Bank announced that it would destroy 6,000 jobs over three years. In April, mining company BHP began moves to eliminate 200 staff from its Perth office.

In every instance, the unions have facilitated the job destruction.

At Telstra, the unions have enforced a continuous offensive against jobs and conditions for over three decades.

In 1991, the unions backed the federal Labor government’s corporatisation of the company, which was then publicly-owned. The move, which was part of a broader pro-business overhaul of the economy by Labor and the unions, set the stage for the telecommunications company to be fully privatised by the Coalition government of John Howard in 2005.

At the same time, the unions have overseen a continuous reduction in jobs at the company. In 2001, the company’s workforce numbered more than 48,000. At the beginning of last year, the figure was around 30,000. With the recently announced layoffs, Telstra’s workforce will have been more than halved within 20 years.

The record makes clear that a struggle in defence of jobs and against the mass sackings can only take place through a rebellion against all of the unions.

New organisations, including independent rank-and-file committees, are required to break the isolation enforced by the unions. Such committees need to turn to other sections of workers in Australia and internationally who face similar attacks and to develop a unified industrial and political campaign to defend all jobs and improve wages and conditions.

Above all, a new political perspective is needed, based on the fight for a workers’ government and socialist policies, including placing Telstra and the telecommunications sector, along with the banks and other major corporations, under public ownership and democratic workers’ control.

Mass protests erupt in Hong Kong

Peter Symonds

A massive demonstration and march through the streets of Hong Kong yesterday against planned changes to its extradition law is a clear sign of a growing political radicalisation of broad layers of the population determined to defend basic democratic rights.

The proposed amendments to the Fugitive Ordinance law would expand the current extradition arrangements to include China. This has provoked widespread concern that the Beijing regime could use the legislation’s provisions to have political opponents and religious dissidents, indeed, anyone regarded as a threat, dispatched on trumped-up charges to the Chinese mainland to be tried and jailed.

According to the organisers, more than a million people took part in yesterday’s protest—almost one in seven of Hong Kong’s total population of 7.4 million. Placards and banners included “No China extradition!” and “Step Down Carrie Lam!” Chief Executive Lam is Hong Kong’s top official and thus responsible for the legislation.

Protesters in Hong Kong (Credit: Twitter: Denise Ho)

The vast crowds included a wide array of student organisations, migrant workers from southern China, political parties, religious groups and non-profit organisations, as well as many thousands of concerned individuals. At least 90 shops shut their doors to enable their employees to take part.

Marchers chanting “Open the street!” surged past police barricades to surround the Hong Kong legislative building where the law is due to be heard again on Wednesday. Five hours after the march began, the Legislative Council complex was still surrounded as organisers foreshadowed further protests. In the early hours of today, riot police used batons and capsicum spray to violently disperse the remaining protesters.

Smaller protests took place in 29 cities around the world, including New York, San Francisco, Sydney, Tokyo, Toronto and Taipei demanding the legislation be withdrawn. “I’m here today because I fear that I might be extradited to mainland China for crimes that I didn’t commit,” Henry Lee, a Hongkonger currently living in Melbourne, told the South China Morning Post.

Yesterday’s mass demonstration is the latest in a series of protests that have been mounting since the extradition legislation was first mooted in February, despite assurances from Lam that political and religious dissidents were not at risk and the independence of the Hong Kong courts was assured. Fears have grown as the executive has sought to ram the amendments through the Legislative Council by-passing committee scrutiny. Tensions have erupted into physical clashes between legislators over anti-democratic procedures.

The annual vigil in Hong Kong on June 4 to mark the Tiananmen Square massacre drew record numbers, with more than 180,000 people filling all six soccer fields and adjoining areas of the city’s Victoria Park. They came not only to demonstrate their opposition to Beijing’s barbaric military crackdown 30 years ago, but also out of concern over the extradition legislation. Undoubtedly, the protest included those who fled to Hong Kong in 1989 and fear they could be arrested and sent back.

Britain handed back its former colony to China in 1997 on the basis that Hong Kong would be a Special Administrative Region (SAR) with a large degree of autonomy under its Basic Law. Beijing’s policy of “One Country, Two Systems” maintained capitalist property relations in Hong Kong, which, in turn, served a critical function for the Chinese Communist Party (CCP) as it accelerated capitalist restoration on the mainland. Foreign corporations, and indeed Chinese companies, set up headquarters in Hong Kong, where their operations in China were solidly guaranteed by its long-established commercial law.

Despite its claims to abide by Hong Kong autonomy, the CCP regime has repeatedly attempted to encroach on democratic rights in its bid to suppress political opposition on its doorstep. In 2003, half a million people marched in Hong Kong to oppose a National Security Bill that would have effectively extended China’s police state measures to the city. The bill was shelved indefinitely.

In 2014, mass protests erupted over Beijing’s plans to maintain tight control over the choice of Hong Kong’s chief executive, who wields wide powers in the administration of the city. While bourgeois liberal opponents such as Democratic Party founder Martin Lee were prepared to compromise, student groups took to the streets to demand free and open elections, sparking street occupations that lasted for weeks before they petered out and were suppressed by the police. Beijing made no changes to its highly restrictive vetting of candidates for the post of chief executive.

If the current protests against the anti-extradition legislation are to go forward, lessons must be learned from past experiences. Chief among these is the political perspective that needs to be fought for.

The failure of the 2014 Occupy or Umbrella movement was not a result of a lack of determination or courage of its youthful participants. Rather, it stemmed from the fact that its leaders from the Hong Kong Federation of Students and Scholarism, while more militant in their tactics and more forthright in their demands, had no political alternative to conservative liberals such as Martin Lee.

Once again, Democratic Party figures such as Lee are prominent in the current protests against the extradition law. They are aligned with sections of Hong Kong’s corporate elite that have opposed the legislation out of concerns that it could undermine the courts and Hong Kong’s attractiveness as a base for investment in China.

Lee and his allies are also promoting the dangerous illusion that the United States can be enlisted to fight for democratic rights in Hong Kong. Last month, Lee led a delegation to Washington, which met with, among others, US Secretary of State Mike Pompeo as well as the US Congressional-Executive Commission on China. The Trump administration has not the slightest concern for “human rights” in Hong Kong or anywhere else for that matter, but will seek to exploit the movement as part of its escalating confrontation and war drive against Beijing.

Hong Kong is one of the most socially polarised cities in the world and is becoming more unequal every year. The economy is dominated by a handful of multi-billionaires, while the majority of the population struggle even to put a roof over their heads, with many forced to live in makeshift accommodation such as “cage houses.”

The struggle for democratic rights in Hong Kong must be based on the working class and is bound up with the broader fight against austerity and for basic social rights such as decent jobs and wages. This means a political struggle based on a socialist program against the domination of the present protests by figures like Lee and other defenders of capitalism, who are organically hostile to any mobilisation of the working class.

It also means a rejection of all those who base their opposition to the extradition laws on Hong Kong parochialism and stoke hostility not only to the CCP regime, but to mainland Chinese in general. The fight for democratic rights in Hong Kong will go forward only to the extent that it turns to and champions the struggles of all Chinese workers for their democratic and social rights.

Above all, a revolutionary leadership must be built in the working class based on the historical lessons of the protracted struggle of the Trotskyist movement for socialist internationalism against Stalinism in all its forms, including Maoism, which is responsible for the police state regime in Beijing. This is the perspective for which the International Committee of the Fourth International fights.

Social Democrats return to government in Denmark with xenophobic programme

Dietmar Gaisenkersting

Social Democratic leader Mette Frederiksen is expected to head the next Danish government and replace Prime Minister Lars Løkke Rasmussen from the conservative-liberal Venstre party.

The Social Democrats won only one seat more in Wednesday’s parliamentary elections compared to 2015 and even lost votes, winning 25.9 percent of ballots cast. However, the collapse of the far-right Danish People’s Party, as well as significant gains by the Social Liberals and the pro-Greens Socialist People’s Party give the so-called “red bloc” a majority of 91 in the 179-seat parliament. At 84.5 percent, turnout was slightly lower than four years ago.

The big loser in the election was the Danish People’s Party, which had supplied the Rasmussen government with its majority. The extreme right-wing party dropped from just under 21 to 8.7 percent and only has 16 instead of 37 deputies in the new parliament. However, the Social Democrats have completely adopted the xenophobic programme of the right-wing extremists and want to continue it in government.

In addition to three more radical right-wing parties, which together won 5 percent of the vote and one of which, the New Right, now has four deputies, Venstre has also benefited from the collapse of the People’s Party. It gained 3.9 percent and now has 43 instead of 34 deputies.

In the election four years ago, the parties of Rasmussen’s “blue block” had won 90 seats, the “red block” parties 89 seats, with the extreme right-wing People’s Party joining the government. In November 2016, it withdrew but continued to support the Rasmussen government.

Rasmussen mercilessly intensified the devastation of the welfare state initiated by the previous Social Democratic government, for which Denmark and the other Scandinavian countries have long been known. Spending on pensioners was cut, one in five schools and one in four hospitals were closed. However, the world’s highest taxes on working-class families, who had funded the welfare state, were not lowered.

According to Christian Hallum of Oxfam Denmark, basing himself on figures from the Danish statistics office, inequality in Denmark has risen by 20 percent over the past year. That is more than in most other countries. Six out of seven “reforms” in the past year have increased the income inequality of Danish citizens, Hallum told the newspaper Kristeligt Dagblad. The number of children now being raised in poverty has increased by 25 percent as a result.

Immigrants are being made the scapegoats for these anti-social policies. The Minister for Foreigners and Integration, Inger Støjberg (Venstre), imposed one law after another making life increasingly miserable for foreigners and immigrants.

For example, refugees arriving at the border have their jewelry and other valuables taken away; a ban on the burqa has been issued. Children who live in districts officially classified as “ghettos” face being taught compulsory courses in “Danish values.”

Two years ago, Støjberg celebrated the fiftieth measure tightening up immigration law with a cake bearing 50 candles. A ticker on her ministry’s web site shows the number of new restrictions; there are now 114, with the result that hardly any asylum seekers come to Denmark.

The Social Democratic Party under Frederiksen voted in parliament for all 114 of these measures. Even when the government planned to house “criminal asylum seekers” on an uninhabited island late last year, the Social Democrats remained silent.

The refugees are to be deported to the island of Lindholm, which was previously the location of a university laboratory where researchers investigated animal diseases. For this reason, the only ferry to the island bears the name “Virus.” Now, the university must decontaminate the island, because refugees are to be accommodated there from 2021. “You are not wanted in Denmark,” Minister Støjberg wrote on Facebook, “And you will feel that.”

The Social Democrats abstained on the vote on the plan in parliament. Already in 2000, the then Social Democratic Interior Minister Karen Jespersen had planned to intern asylum seekers who had committed a crime on a remote island.

Under the Social Democratic Prime Minister Helle Thorning-Schmidt, from 2011, Frederiksen was labour and later justice minister. After defeat in the 2015 general election, she took over the party leadership from Thorning-Schmidt and copied the racist policies of the People’s Party.

“Nobody is a bad person just because he is worried about immigration,” Frederiksen said. Like the far-right, she too blames refugees, and not the decisions of big business and politicians, for the dismantling of the welfare state. “Our welfare model is under pressure,” she wrote in a programmatic statement, “as is our high level of equality and our way of life.” She told her biographer that it was “increasingly clear that the price of unregulated globalization, mass immigration and the free movement of labour is being paid for by the lower classes.”

The Danish Social Democrats want to limit immigration from non-Western states and set up reception centres for asylum seekers outside Denmark.

In the election campaign, Frederiksen had already announced that in the event of an electoral victory, her government would continue to work with the People’s Party on immigration issues. She is seeking to form a social democratic minority government that secures parliamentary majorities on a case-by-case basis. This is not uncommon in Denmark, but still requires firm agreement with other parties.

Frederiksen touts her right-wing extremist path as a model for the whole of Europe and has called on European Social Democrats to do the same.

The rightward shift of Danish Social Democrats once again underscores the fact that there is no limit below which it would not go. The party stands for massive social cuts, militarism, police state and openly racist politics. They are seeking to make the right-wing superfluous by taking their place.

Teachers struggles erupt across Latin America

Andrea Lobo

On Thursday, while teachers and doctors across Honduras were confronting death-squad activity as they continued their month-long strikes and demonstrations against the privatization of education and health care, 75,000 educators were taking to the streets in Santiago, Chile, and hundreds demonstrated in San José, Costa Rica.

Elsewhere in Latin America, tens of thousands of teachers joined a general strike on May 31 against the endless austerity and cuts to real wages by President Mauricio Macri’s administration, and a million workers and students marched across Brazil on May 15 against cuts to public education. Colombia, Venezuela and Mexico have also seen major strikes by teachers earlier this year against attacks on funding and pay.

In every country, teachers face the same scourge—cuts to their real salaries, bonuses and pensions, along with the ruining of their workplaces and lack of didactic materials, privatization drives, the demonization by the corporate media and capitalist politicians, the growing poverty and lack of social services that their students and communities face along with growing repression and attacks against basic democratic rights.

The source of these social attacks is also the same. As the crisis of global capitalism deepens and warnings mount of another imminent crash triggered by the US economic war against China, the financial and corporate ruling elites are intensifying their financial parasitism, which increasingly relies on leeching money from existing social wealth like pensions and the resources assigned to public spending.

In Latin America, a short period of minor increases in social spending under the so-called “Pink Tide” governments—allowed by a surge in commodity prices in turn fueled by China’s growth— has been followed since 2014 by an abrupt lurch back to economic stagnation, attacks against jobs and wages and social austerity.

Whether countries have been ruled by openly right-wing regimes, such as the governments of Macri in Argentina, Sebastián Piñera in Chile, Iván Duque in Colombia, Jair Bolsonaro in Brazil, and Juan Orlando Hernández in Honduras, or forces in some fashion associated with the “Pink Tide”, as in El Salvador, Nicaragua, Costa Rica, Ecuador, Venezuela and Uruguay, the imposition of the weight of the economic downturn on the working class and public services it relies upon is universal.

At a time in which teachers need to be appealing with every ounce of energy and time to the rest of the working class in each country and to teachers internationally to take a united stand against endless austerity, the trade unions, including those seeing the need to call strikes in order to let off steam, as in Costa Rica, Honduras and Chile, are channeling each of these struggles behind futile negotiations with bourgeois governments that are proven enemies of public education and the working class as a whole.

The response by the ruling class to this resistance led by teachers has been the same everywhere: claims that there is “no money”, along with police state repression and reprisals. Above all, however, they have counted on the trade unions to isolate and betray the strikes. Not one of these struggles has met the demands of teachers and other workers.

In Honduras, education and medical staff in the public sector have carried out strikes, mass demonstrations and roadblocks since late April against two bills aimed at facilitating mass layoffs and the further privatization of these services demanded by the International Monetary Fund (IMF). The National Party regime, which was installed in a military coup backed by the Obama administration in 2009, has deployed US-trained special forces accompanied by police and plainclothes agents to shoot live ammunition at demonstrators and kidnap them.

On Monday, the body of Yefrin Guillermo Arias García, a young doctor who was participating in the protests, was found in the western department of Copán. Several videos by bystanders surfaced online this week showing armed groups snatching demonstrators and taking them away in vehicles, recalling the activities of death squads during the US-instigated civil wars in the region during the 1980s and 1990s.

In Chile, for two Thursdays in a row, the infamous Carabineros special forces violently repressed marches in the cities of Santiago and Valparaiso with water cannon, tear gas, rubber bullets and stampedes.

Teachers are fed up with conditions in Chilean schools, citing rodent infestations, infrastructural damage, unsanitary bathrooms and a lack of textbooks more than two months after classes started. The ongoing indefinite strike, however, began soon after protests erupted over the elimination of history from the core curricula in high schools, which is widely perceived as a concerted step by the right wing to suppress the history of the murderous Pinochet dictatorship.

After teachers in Costa Rica led a 93-day public-sector strike betrayed by the trade unions last year—the longest strike in the country’s recorded history— the government has become emboldened and has targeted educators.

The partial and intermittent strikes this week called by one of the three main education unions, APSE, was triggered by the outrage among teachers caused by a bill banning strikes in the education sector and the recently approved “Law to Bring Legal Security over Strikes and its Procedures.” The latter bans all strikes against government policies as well as the setting up of picket lines and roadblocks, and establishes an expedited process for ruling the strikes illegal.

One only needs to look at the events in Honduras and Chile to know what the enforcement of such a measure looks like.

The turn to murderous repression and attacks against democratic rights to enforce the austerity dictates of the IMF and Wall Street has the complete backing of US imperialism.

On Wednesday evening, US Chargé d’Affaires Heide Fulton tweeted: “I expressed today my gratitude to the Honduran security forces protecting the US embassy in Honduras for your service,” while tagging the Honduran Police and Military pages.

On the other hand, despite efforts by the press to portray teachers as “selfish” and “lazy”, their leadership role in the fight against social austerity has elicited widespread support among broader layers of the working class.

Parents from La Esperanza, in the western Honduran department of Intibucá, have been occupying the María Teresa Castellanos Kindergarten since last month to protest the privatization bills. Claudia, a mother said to Hoy Mismo, “We will back teachers until the end.”

Similarly, last year’s strike in Costa Rica won the active participation in marches and roadblocks of hundreds of thousands in the first weeks.

The strikes in Latin America are unfolding in the context of a global wave of struggles by educators from the United States to New Zealand, to Poland, to India and North Africa.

The globalization of capitalist production has created similar attacks on educators and the working class as whole in every country, with the strikes of teachers and other workers in each country taking on the character of linked battles in one world struggle.

The decisive question facing teachers and the working class as a whole in Latin America and internationally is that of breaking the stranglehold of the trade unions and forming new fighting and democratic organizations, rank-and-file committees at each workplace and neighborhood to take the conduct of each struggle into the hands of the workers themselves, and uniting them across sectors and borders as part of an international and political movement for power and a socialist alternative to bankrupt capitalist system.

Ford to close Bridgend engine plant in Wales, eliminating 1,700 jobs

Robert Stevens

Ford Motor Company this week announced the closure of its Bridgend engine plant in south Wales, with the loss of 1,700 jobs. The plant is scheduled to close by September of 2020, inflicting a devastating blow to workers and their families in an area decimated by decades of deindustrialisation.

The Bridgend plant was opened in 1980 after Ford was offered incentives to invest by the outgoing Callaghan Labour government.

The closure is part of Ford’s global restructuring programme, with Ford of Europe President Stuart Rowley stating, “Changing customer demand and cost disadvantages, plus an absence of additional engine models for Bridgend going forward, make the plant economically unsustainable in the years ahead.” The company indicated that it plans to step up production of hybrid rather than petrol engines.

Workers at the plant were given no notice. They were sent home Thursday after receiving a letter saying they will lose their jobs in phases by September 25 of 2020. According to some employees, Ford could start making redundancies as nearly as Monday next week.

One of the workers told ITV News that “quite a lot of us relocated from Southampton to Bridgend when they shut the place.” He added, “There’s not going to be anything left is there?”

Ford closed its Southampton plant, which manufactured transit vans, in 2013, with the loss of 500 jobs. The firm shifted production to Turkey, boasting that its costs would be “significantly lower” than in Western Europe.

The move to full closure comes only months after Ford announced last January that it was cutting 1,000 jobs at Bridgend, with 370 going in the first wave.

Ford produces over a million engines annually at two UK locations—Bridgend and Dagenham in Essex (which makes diesel engines.) As part of an integrated global production network, petrol engines made at Bridgend are shipped to Ford production facilities overseas for use in the Focus and Kuga models.

A major factor in the closure was the upcoming end of a contract for larger engine production for Jaguar Land Rover (JLR) models. Engine production for JLR stems back to 2008, when Ford sold off both Jaguar and Land Rover to Tata Motors and agreed a contract to produce the engines in Wales. But in 2017, JLR announced it would start producing all its engines in-house at its plant in Wolverhampton from 2020.

Bridgend was to produce the new Dragon three-cylinder 1.5 litre engine from this year, but demand for it is dwindling. The plant was equipped with capacity to produce 750,000 Dragon engines annually, but predicted volumes fell first to 250,000, then to 125,000, and, according to reports, to just 80,000 now. As a consequence, since 2016, Ford has slashed planned investment at Bridgend from £181 million to £100 million.

Ford is not abandoning the Dragon, but will shift production in a cost-cutting operation—under its One Ford global strategy—from Wales to its plants in India and Mexico that already make them. Dragons are also produced in Brazil, China and Russia.

Ford claimed that the UK’s planed exit from the European Union was not a factor in its decision. However, Ford and other car manufacturers have repeatedly warned of the danger of the UK crashing out of the EU in a no-deal Brexit and stressed that loss of tariff-free access to the Single Market would imperil their myriad cross-border supply operations.

Due to a lack of demand, with a glut of vehicles on the global market, the number of cars built in the UK in April fell by almost half compared with the previous year. The fall was compounded as several manufacturers operating in the UK, including Nissan, Honda and Jaguar Land Rover, brought forward summer production stoppages in anticipation of a Brexit, which was ultimately postponed until October 31.

The Bridgend announcement follows Ford’s move last month to shed 550 office and management jobs in Britain as part of 7,000 white-collar jobs going worldwide.

Closure of Bridgend signifies an acceleration of Ford’s global restructuring, following the bringing on of a new chief financial officer from online retail conglomerate Amazon, a company notorious for the super-exploitation of its workforce. In April, Ford announced plans to cut 5,000 jobs in Germany. It also plans to close plants or consolidate its operations in France, Russia and Brazil. It is cutting thousands of jobs in China in response to a decline in vehicle sales, which fell by 40 percent.

The unions have reacted with feigned outrage at Ford’s decision. Unite General Secretary Len McCluskey stated that the union would “resist this closure with all our might.” Speaking as would a corporate executive, he declared the closure “a grotesque act of economic betrayal” to the “manufacturing base” after “Ford broke promise after promise to the UK.”

Deliberately promoting economic nationalism in order to drive a wedge between British workers and their counterparts throughout Europe and around the world, he added, “The company has deliberately run down its UK operations so that now not a single Ford vehicle—car or van—is made in the UK.” McCluskey complained that it was “easier and quicker to sack our workers than those in our competitor countries.”

Neither strikes nor any other forms of industrial action are being organised by the union. Unite’s phony “resistance” is focused on a bankrupt “call upon the governments at the Welsh Assembly and Westminster to join us to save this plant, and to prevent yet another grave injury to UK manufacturing.”

McCluskey’s demagogy belies everything Unite and the other unions have already done in preparing the way for the closure, including collaborating with the firm to impose whatever “voluntary” redundancies it demanded.

In January, Walesonline reported that the unions would be party to a Ford presentation outlining how the company planned to cut the workforce over the next two years. At the time, Ford said it would work with its “union partners” and other key “stakeholders” to implement a “comprehensive transformation plan aimed at strengthening the Ford brand.” The company added: “The strategy will result in fewer jobs—both hourly and salaried—but it is premature to speculate on how many, as we have just begun discussions with our Works Council and union partners… [W]e aim to achieve the reduction in labour costs through voluntary employee separations and will be working closely with social partners and other stakeholders.”

This rotten process, carried out behind closed doors—with workers kept in the dark—has resulted just a few months later in a plan to scrap the entire plant. The unions are concerned only to cement their status as reliable “partners” of management and the government.

GMB regional organiser Jeff Beck said the announcement was a “real hammer blow for the Welsh economy and the community in Bridgend.” He insisted, “Regardless of today’s announcement, GMB will continue to work with Ford, our sister unions and the Welsh Government to find a solution to the issue and to mitigate the effects of this devastating news.”

In a nationalist diatribe, he declared, “What makes it worse is Donald Trump is in this country talking about a possible trade deal with the UK and the US—yet if the plant does close, the new line is likely to be produced in Mexico by an American company… So much for the special relationship, Mr Trump!”

To survive in a dog-eat-dog industry, Ford operates on a global playing field, always seeking to increase profitability at the expense of its workers’ jobs, wages and conditions, as demonstrated by its plans to shift Dragon engine production to cheaper sites in India and Mexico. All of the global automakers are conducting job-cutting campaigns like Ford’s. GM is slashing 14,000 jobs, Volkswagen 7,000, Tata Motors’ Jaguar Land Rover is cutting 4,500 and Tesla is slashing 3,000.

Workers can oppose these corporations only by developing an internationally coordinated campaign to defend their jobs and living standards. This fight can be waged only in a struggle against the nationalist programme of the unions.

The unions are not working class organisations and do not function in defence of their members’ interests, but rather in the interests of the companies and the “manufacturing industry.” As all international experience in the car industry and elsewhere demonstrates, if the struggle against job losses is left in the hands of the unions, the Bridgend plant will close.

To avoid this devastating outcome, it is imperative that workers at Ford Bridgend take the fight to defend their jobs out of the hands of the unions and assert their own class interests—not those of the corporations—via the formation of independent rank-and-file committees. This must be based on mounting a common offensive in defence of their jobs and livelihoods alongside car workers in Britain and internationally.

Australian police chief links media raids to US-led “Five Eyes” spy network

Mike Head

The Australian Federal Police (AFP) called a news conference on Thursday to justify its raids targeting journalists at two media organisations this week.

Police spent seven hours ransacking a News Corp political reporter’s home in Canberra on Tuesday, and eight hours poring over and seizing files at the Australian Broadcasting Corporation’s (ABC) Sydney headquarters on Wednesday.

Acting AFP commissioner Neil Gaughan [source: Australian Broadcasting Corporation]

In an extraordinary admission, the AFP’s acting commissioner Neil Gaughan blurted out that the real reason for the raids was to protect the information that the Australian police and intelligence agencies receive from their “Five Eyes” counterparts. Five Eyes is a top-level network of intelligence agencies dominated by the US that also includes Britain, Australia, Canada and New Zealand.

“The Australian government, or particularly the Australian enforcement and intelligence communities, rely on secret and top-secret information from our international partners, particularly our Five Eyes partners,” the police chief said. “If we can’t be seen to protect our own internal information, [then] we are concerned that the information flow to us dries up.”

Citing government demands for investigations into leaks of secret information, Gaughan said the AFP received “numerous referrals to us [of leaks] and to be honest we get too many. But the premise of investigating these matters is to ensure the international community knows that we take the leaking of information, sensitive information, seriously.”

In other words, the AFP is under pressure not just from Canberra, but from Washington, to ensure that information, including about criminal actions of governments and its agencies, is kept from public view. This takes place amid the Trump administration’s mounting threats of war against Iran and Venezuela, as well as its escalating confrontation with China.

The AFP search warrants related to leaked documents exposing war crimes perpetrated by the Special Air Service (SAS) in Afghanistan and plans to legalise domestic mass surveillance by the Australian Signals Directorate (ASD), which are both central to Five Eyes operations.

Gaughan’s remarkable declaration went virtually unreported throughout the establishment media in Australia and internationally. His admission vindicates the analysis made by the WSWS on Thursday:

“[I]t is inconceivable that the Australian government would have instigated and pursued the investigation of the ABC and Murdoch media journalists without the agreement, if not urging, of Washington. Both the SAS and the ASD surveillance agency are closely integrated into all the wars and war preparations of the US.”

Gaughan’s statement also underscores the warnings made by the WSWS that the persecution of WikiLeaks founder Julian Assange for exposing the war crimes, mass spying and regime-change operations of Washington and its allies, including Australia, is setting a precedent for the criminalisation of journalism.

By specifically targeting journalists, as well as whistleblowers, the Australian government is following the lead of the Trump administration. The US has charged Assange, a journalist and publisher, with multiple counts under the Espionage Act, for which he faces life imprisonment.

At his press conference, Gaughan refused to rule out laying charges against News Corp journalist Annika Smethurst or ABC reporters Dan Oakes and Sam Clark for publishing alleged “national security” secrets. Such charges against journalists would be without precedent in Australia since World Wars I and II.

In a pointed warning, Gaughan said “no sector of the community should be immune” from police investigations into alleged law-breaking. Gaughan said the police are probing the “publication” of documents marked “secret” and “top secret,” placing journalists and publishers squarely under threat of prosecutions.

The AFP is investigating breaches of the Crimes Act, which criminalises unauthorised disclosures by public servants, and also contains offences that apply to journalists. Journalists, as well as alleged leakers, can be jailed for up to seven years. Dating back to World War I, the legislation outlaws “receiving” information that “prejudices the security or defence” of Australia.

But, asked what was the harm of revealing wrongdoing by Australian troops or plans to extend spying laws, Gaughan said the substance of the reports was “irrelevant.” The mere disclosure of protected information was a crime. He bluntly stated: “The issue of whether or not the public has the right to know is really not an issue that comes into our investigation process.”

The Crimes Act provisions were recently replaced by even more far-reaching measures embedded in the “foreign interference” legislation that the Liberal-National government pushed through parliament at Washington’s urging late last year, supported by the Labor Party. The maximum penalties were increased to 10 years’ imprisonment. However, the new laws could not be applied to the current cases, because the alleged leaks occurred in July 2017 and April 2018.

Gaughan tried to refute accusations that the AFP was acting at the government’s behest. He denied that the police had waited until after the May 18 federal election to execute warrants and claimed no contact had been made with the government since the AFP informed Home Affairs Minister Peter Dutton when the investigations first began.

These claims fly in the face of the facts. The government itself instigated both AFP investigations, and the Labor Party fully supported it in doing so. And Dutton and other government ministers immediately defended the raids. When Prime Minister Scott Morrison was asked at a press conference if he was bothered by police raiding journalists’ homes, he replied: “It never troubles me that our laws are being upheld.”

Above all, as Gaughan himself revealed, the raids were mounted to satisfy the Five Eyes powers, which means the US above all. Successive governments, both Liberal-National and Labor, have committed Australia to be a key partner in this network as part of its military alliance with the United States.

The police raids are part of a global crackdown on freedom of speech, including in the US and other countries, such as France, where governments are taking the Trump administration’s repressive lead.

This assault is targeted directly at the basic right of the working class to know the crimes, war plans and conspiracies of the capitalist ruling elites and the state apparatuses they control. It is being mounted amid growing struggles by workers around the world against soaring social inequality and declining living and working conditions.

The Australian police chief’s open threats highlight the urgency of the worldwide campaign being waged by the WSWS and the Socialist Equality Parties for the defence of Julian Assange and the jailed whistleblower Chelsea Manning. Their plight is a test case in the struggle against the lurch toward war and dictatorial forms of rule.

Austrian ruling class closes ranks following collapse of government

Markus Salzmann & Peter Schwarz

The Austrian ruling class is closing its ranks following the recent collapse of the far-right-conservative government. On Monday, the Austrian president, Alexander Van der Bellen, swore in a “government of experts,” which he personally selected and is responsible for government affairs until fresh parliamentary elections this autumn. The new regime is supported unreservedly by all the parties represented in the Austrian lower house of parliament (National Council).

The government of experts has two functions.

Firstly, it has the task of instilling political calm in the country and ensuring that the massive opposition to the collapsed right-wing government does not find independent expression. In gushing tones, Van der Bellen, a former federal spokesman for the Green Party, stressed the theme of national unity during the swearing-in process. In a period of domestic turbulence, Austria had proved its resilience, he said, thanks to “the courage expressed in the national anthem and the ability of Austrians to communicate with one another.”

Secondly, the new regime is to continue the right-wing policies of the toppled outgoing government and enable the widely discredited Freedom Party (FPÖ) to return to government after the election. A secretly filmed video in Ibiza, which triggered the government crisis, made clear that the FPÖ chairman and vice-chancellor, Heinz-Christian Strache, was guilty of bribery and corruption.

The new federal chancellor is 69-year-old Brigitte Bierlein, the former president of the country’s Constitutional Court. The lawyer, regarded as “conservative in values” and right-wing, is reported to have good contacts with the FPÖ and the conservative Austrian People’s Party (ÖVP). In 2002, she was appointed vice-president of the Constitutional Court by the then ÖVP-FPÖ government. Her promotion to head of the court two years before her planned retirement was thanks to the FPÖ.

Van der Bellen tried to disguise the right-wing character of the new transitional government by stressing that a woman was now heading the Austrian government for the first time. He was happy about this and “made no secret of the fact” that for the first time a woman was heading a government in which half of its members were female. “In the future,” the president said, “nobody can say anymore, ‘That's not possible.’ ”

The Foreign Ministry has been taken over by Alexander Schallenberg, the “eminence grise” ( Der Standard ) of Austrian foreign policy. The 49-year-old, who comes from an aristocratic and diplomatic family, has had a long diplomatic career. He is regarded to be a close ally of ex-Chancellor Sebastian Kurz (ÖVP). Previously, he was active as a leading representative for Austria in Brussels and has played a major role in shaping the country’s foreign policy, including under ÖVP-FPÖ rule.

The character of the transitional government is most clearly shown by the new infrastructure minister, Andreas Reichhardt. In 2003, the Freedom Party politician was deputy leader of the cabinet and spokesperson in the Transport Ministry headed by Hubert Gorbach (FPÖ) in Austria’s first far-right-conservative coalition government. In 2008, photos turned up showing Reichhardt as member of a far-right fraternity wearing a uniform while standing next to Strache and a convicted neo-Nazi.

The new interior minister is Wolfgang Peschhorn. Peschhorn is former president of the Financial Procurator and has the job of implementing a severe austerity programme. The lawyer is regarded to have played the leading role in the nationalisation of the Hypo Alpe Adria Bank. Following the financial crash of 2008, millions of euros were diverted from the national budget to save the collapsed bank. The Alpe-Adria crisis also demonstrated the close links between high finance and the country’s right-wing governments and parties.

Taking over as defence secretary is Thomas Starlinger, who has served as the main military advisor to the president since 2017. With the appointment of the 56-year-old major general, Van der Bellen, whose party was originally recruited from sections associated with the peace movement, has laid the basis for much more military influence in politics.

Prior to his move to the presidential office, Starlinger was the vice-chief of staff at the multinational NATO command centre in Ulm, which oversees military operations in the Balkans, the Middle East, and Africa. From 2003 to 2007, he worked for the Austrian military mission at the European Defence Agency in Brussels.

A military man also headed the Defence Ministry in the interim government (which lasted just five days) appointed by Van der Bellen following the parliamentary vote to oust Chancellor Kurz. Deputy Chief of Staff Johann Luif has links with all the main political parties, and in particular the FPÖ. According to the Austrian Kurier newspaper, “He was on good terms with both Doskozil (Austrian Social Democrat, SPÖ) and Kunasek (FPÖ).” Between 2003 and 2016, Luif was military commander in the Austrian state of Burgenland, which was led by a FPÖ and SPÖ coalition.

Leading FPÖ politicians have praised the new government. On Monday, the new leader of the FPÖ, Norbert Hofer, thanked President Van der Bellen and Chancellor Bierlein for their prudent conduct and constructive discussions in recent days.

Hofer explained that the FPÖ would prove to be a reliable partner for the new government when it came to advancing the interests of Austria and its people. Ex-Interior Minister Herbert Kickl, an FPÖ hardliner, wished “all the best to the designate transitional government in its work.”

“I am confident that the ministers selected by designate chancellor Brigitte Bierlein will continue to run the administration well before the opportunity for new political changes following elections this autumn,” Kickl said. “It is now important for us to make the principles and arguments of the FPÖ to reshape our homeland Austria as visible as possible. It was FPÖ ministers who set the pace in government and implemented the main reform projects.”

There are many signs that after the elections, both the ÖVP and the SPÖ will be prepared to form an alliance with the far-right. ÖVP leader Sebastian Kurz and other prominent ÖVP politicians have already made comments to this effect.

Support for an alliance with the extreme right is also increasing inside the SPÖ, which is already in coalition with the FPÖ at state level. Recently in parliament, SPÖ Secretary Thomas Drozda gave a wink to Kickl indicating his readiness for talks, despite the fact that the latter had formerly severely criticised the SPÖ. The scene was broadcast on Austrian television the same evening.

Ukrainian president seeks support from Western powers

Jason Melanovski

Newly elected Ukrainian President and former comedian Volodmyr Zelensky headed to Brussels this week to meet with EU and NATO officials in an attempt to shore up support for his government among the imperialist powers. The trip marked his first official foreign visit.

During a meeting with NATO Secretary General Jens Stoltenberg on Tuesday, Zelensky made clear that his pre-election, equivocal statements on Ukraine’s entrance into the EU and NATO were a ploy intended to gain the support of voters in the predominately Russian-speaking areas of the country where opposition to NATO membership remains especially high.

“The strategic course of Ukraine to achieve full-fledged membership in the EU and NATO, which is secured in the Constitution of Ukraine, remains unchanged. This is the priority of our foreign policy,” Zelensky declared this week. Previously, he had implied that any prospect of Ukraine joining NATO and the EU was far in the future and would be subject to voter approval through a national referendum.

While stating that he was willing to hold talks with Moscow over the pro-Russian separatist movement in Ukraine’s eastern Donbass, Zelensky also made clear his commitment to winning and maintaining the support of the US and its European allies at Russia’s expense.

“We are ready for the negotiations with Russia. We are ready to fulfill the Minsk agreements,” Zelensky said, adding, “But first of all we must be able to protect ourselves. I am grateful for the support Ukraine receives from the Alliance and allies.”

In a separate meeting with European Council President Donald Tusk, Ukraine’s new president indicated his support for the continuation and intensification of the EU’s anti-Russia sanctions.

“I today informed Mr. Donald Tusk and other partners about ongoing Russian aggression in Donbass and Crimea. I expressed my gratitude for the EU’s unchanged position in support of Ukraine and called for further consolidation of international efforts and strengthening of sanctions pressure in order to bring peace to Ukraine,” said Zelensky.

Prior to winning the presidency, Zelensky met privately with French President Emmanuel Macron allegedly to discuss ending the five-year old war in Eastern Ukraine that has claimed over 13,000 lives. Since his election, he has increasingly decried Russian “aggression.”

Zelensky also used his trip to Brussels to reaffirm his commitment to implementing the International Monetary Fund’s (IMF) austerity policies. Distancing himself from comments made by Ukrainian oligarch Igor Kolomoisky that the country should snub the IMF and default on its massive external debt, on Twitter Ukraine’s president stated that he told EU officials his administration had “nothing in common” with Kolomoisky’s views. His advisors have made clear in recent weeks that Ukraine will remain in the current $3.9 billion IMF program, which requires drastic hikes in the price of consumer gas.

In his efforts to drum up support among the Western powers, Ukraine’s president increasingly finds himself enmeshed in the growing tensions between the United States and the EU, in particular Germany.

In a meeting with EU officials in May, Zelensky appealed “for the EU’s solidarity in the matter of countering the completion of Nord Stream 2” gas pipeline, which threatens to undercut Ukraine’s position as the main transit country for Russian gas to Europe by transporting supplies directly to Germany via the Baltic Sea.

There is significant fear within the Ukrainian ruling-class that should Nord Stream 2 be completed as planned, support for Ukraine’s entrance into NATO and the EU within Europe would be significantly weakened. Zelensky’s predecessor, Petro Poroshenko, called the Nord Stream 2 a “Trojan horse” which would make Europe dependent on Russia.

NATO member Poland has backed Ukraine in its opposition to the pipeline, with Poland’s Foreign Minister Jacek Czaputowicz stating that the pipeline “will kill Ukraine.”

Germany, which supported the so-called “Maidan Revolution” against elected President Viktor Yanukovych in 2014, would be the main beneficiary of the Nord Stream 2 pipeline. The infrastructure project would ensure that Germany would receive Russian gas regardless of its policies towards Ukraine and the rest of Eastern Europe.

The pipeline has been a central component of the rapidly escalating tensions between Washington and Berlin. President Donald Trump, despite being depicted as a subversive Russian-agent by Democrats, told German Chancellor Angela Merkel to “to stop buying gas from Putin.”

US officials have also threatened Germany with sanctions over the pipeline. A bi-partisan bill that would target companies working on the project was introduced into the US Senate by Republican Senators Ted Cruz, John Barrasso and Tom Cotton and Democrat Jeanne Shaheen.

German Chancellor Angela Merkel has so far refused to budge on the Nord Stream 2 issue and adopt the rabidly hostile posture demanded by Zelensky and the United States. “Geostrategically, Europe can’t sever ties with Russia,” she recently told Deutsche Welle .

This week, a Zelensky advisor revealed that Trump has invited Zelensky to Washington after the upcoming G20 summit in Japan later this month. “Zelensky has been given a certain credibility from the United States,” he said.

Prior to the Ukrainian elections in April that brought to Zelensky to power, the United States ruling class tacitly supported the continuation of the Poroshenko regime, with Washington-based think tanks such as the Atlantic Council issuing warnings about Zelensky’s business ties to Russia through his TV production company.

Subsequent to Zelensky’s election, Kurt Volker, the United States Special Representative to Ukraine, in an interview with Hungary’s Valasz news magazine, sent a veiled threat that a negotiated deal between Ukraine and Russia would not be tolerated.

Zelensky “will insist on the full restoration of Ukraine’s sovereignty and territorial integrity and he supports the process that is already in place to do that. Doing otherwise would turn people against him very quickly,” said Volker.

Zelensky’s first official trip took place as criticism is already beginning to appear in Ukraine that his presidency does not substantially differ from that of Poroshenko.

This week, two Ukrainian policemen were arrested for killing a five-year old boy in Kiev while drunkenly shooting their weapons at empty cans.

The boy, Kyrilo Tlyavov, was initially brought to the hospital in the capital with claims by police that he had fallen and hit his head. The story proved to be made up, with doctors finding bullet fragments in his skull. The head of the police force where the incident took place has resigned.

In Kiev and around the country there have been rallies calling for the removal of Interior Minister Arsen Avakov, who controls the country’s police forces. Avakov so far has refused to step down. Zelensky, who has already removed several Poroshenko-allied ministers, has not moved against Avakov. He has instead called for an investigation of the official on his Facebook account.

The interior minister is said to have a close relationship with oligarch Igor Kolomoisky, who openly backed Zelensky against Poroshenko in another saga of the long-running, inter-oligarchic disputes that continue dominate Ukrainian politics.

US coal producer Cloud Peak Energy files for bankruptcy

Zachary Thorton

Wyoming-based Cloud Peak Energy has become the latest major US coal producer to file for Chapter 11 bankruptcy, a move that threatens the livelihoods of over 1,200 workers and their families.

The company is the third-largest producer of coal in the US. It operates three mines, two in Wyoming and one in Montana, in the largest coal mining region of the country, the Powder River Basin. In 2017, Cloud Peak was responsible for 7.4 percent of total US production, after Peabody Energy (20.2 percent) and Arch Coal (12.9 percent). Both Peabody and Arch filed for bankruptcy in 2016.

On May 10, Cloud Peak submitted its Chapter 11 filing in Delaware following wide speculation that the company was preparing to do so. With a $1.8 million interest payment due on March 15, the company did not make its payment and was granted a 30-day grace period. By May 8, Cloud Peak was issued its third forbearance, giving the company three days to make its payment or default. Extensions following the grace period were gradually reduced from two weeks, to one week, to just a few days.

The bankruptcy of Peabody Energy in 2016 followed a similar course, with the company submitting its own filing after the expiration of a 30-day grace period for a $71 million interest payment on its debt.

On March 27, the New York Stock Exchange delisted Cloud Peak due to poor performance. The company’s third quarter report released on October 25, 2018 revealed a 15 percent reduction in coal shipments compared to the same period the previous year.

The insolvency of the company has coincided with savage attacks on coal miners. Last August, management announced it would be cutting health care benefits for its retirees. Worker Anne Zollinger, who retired last May after dedicating twenty years to Cloud Peak, expected to receive a paltry $600 a month, but now receives only $250. Speaking to Wyoming Public Media, she said, “I put my time in, worked safely for over twenty years and now I don’t have what was promised to me.”

Companies seeking to offset their losses by attacking the pensions and benefits of workers and retirees is a well-established principle within the industry. When Patriot Coal, a subsidiary of Peabody Energy, filed for bankruptcy in 2012, it sought to discharge health care and pension obligations for more than 2,000 active union miners and more than 10,000 retirees. Alpha Natural Resources, which filed for bankruptcy in 2015, was determined to cut medical and life insurance benefits for non-union retirees, impacting up to 4,580 workers and their spouses, as well as 6,670 future retirees.

The United Mine Workers (UMW) union has long overseen the erosion of workers’ gains through the betrayal of strikes at AT Massey, Pittston, Peabody and other coal companies in the 1980s and 1990s and the imposition of one concession after the other. This facilitated the shell game of changing company names, mergers and acquisitions and bankruptcies that have robbed retirees of their hard-earned pensions.

Richard Trumka, who oversaw the defeats of what was once the most militant section of the American working class, was rewarded with the highest position in the AFL-CIO, while his right-hand man, Cecil Roberts, has run what remains of the UMW since 1995. The union, which had 160,000 working coal miner members in 1978, has fewer than 50,000 members today and a large number are not miners.

A recent court ruling has established a precedent that could allow mining companies to shred collective bargaining agreements. In February, Westmoreland Coal Company, which operates mines in the US and Canada, was given the go-ahead to eliminate health care benefits for retirees and their union contract after a Texas bankruptcy judge ruled in the company’s favor.

While Cloud Peak miners face devastating losses, the executives, investors and advisors are walking away from the bankruptcy proceedings unscathed and oftentimes substantially wealthier. For navigating the process, Cloud Peak’s CEO, Colin Marshall, was granted a one-time “retention” bonus of $1.15 million in addition to his annual salary of $765,000, and any additional annual bonuses and compensation he might receive. The company’s other top executives each stand to pocket annual payouts of $2 million or more.

In its Securities and Exchange Commission filing, Cloud Peak reported that it will be offering over $16 million in bonuses and incentives for “key” executives, and $40.2 million in “professional fees” for the bankers and advisors guiding the company through bankruptcy.

Cloud Peak’s insolvency is in part the result of financial incompetence, particularly the squandering of a $300 million cash investment on a mining project in 2012 that today remains at the permitting stage. However, more importantly, it is an expression of the overall decline of coal production in the US. Coal has been hit by the sharp decline in the price of natural gas—which is roughly on par with coal—and most of all, the slowing of demand due to the crisis of American and world capitalism, which has been exacerbated by the trade war between the US and China.

The 2008 financial crisis has left lasting effects on the coal industry and the economy as a whole, and although coal managed for a time to weather the storm, by 2011 coal prices had peaked. A January 30 report from the US Energy Information Administration (EIA) shows that more than half of the US coal mines operating in 2008 have since closed.

Schneider Electric lays off over 300 in Peru, Indiana

Michael Walters

Schneider Electric has announced the closure of its Square D production plant in Peru, Indiana, 80 miles north of Indianapolis, destroying more than 300 jobs. The French multinational says approximately 70 percent of the plant’s production will be moved to Monterrey, Mexico, with the remainder shifted to plants in Texas and the US East Coast.

Corporate executives claimed the closure was necessary due to “competitive market dynamics and to meet the needs of Schneider Electric’s customers.” In reality, the closure is only necessary to meet profit goals for the investors.

Schneider’s 2018 profits were $2.73 billion, and CEO Jean-Pascal Tricoire pocketed an estimated $7 million (€6.2 million) in compensation, according to Bloomberg.

The closure takes place amid a global assault on jobs and record corporate profits. Ford is expected today to announce the closure of its British engine plant in Wales, wiping out 2,000 jobs. This is the latest cut by global automakers, which have announced tens of thousands of layoffs since late last year in the face of declining sales and mounting signs of a new global recession.

Schneider Electric (Credit: WikiMedia Commons)

In the first half of 2019, six employers in Indiana have fired over 2,200 workers. As one of the largest employers in Miami County, Indiana, Schneider’s closure of the plant will have a devastating impact on the town of 11,000. Since 2017, the plant has cut 120 jobs, almost 25 percent of its workforce. The area already suffers from a 14 percent official unemployment rate with the real rate much higher due to the number of workers who have dropped out of the labor force.

Recent closures by KMart and Shopper Value Foods in the area have already hit working-class communities with the loss of ancillary jobs and tax revenue, and this is expected to lead to local governments slashing education and other vital services.

Schneider Electric purchased the company Square D in 1991. In 2014, after a 13-day strike, the workers at the plant were forced to accept a concessions contract that froze their pensions and switched them to a 401(k) defined contribution plan. The contract pushed by the International Association of Machinists (IAM) and its 2017 successor gave the workers below-inflation pay raises. However, these concessions and the string of layoffs were not enough for Schneider’s corporate investors.

The closure of the Peru facility was first announced in February 2019. Since then, the local government and the IAM have groveled before Schneider, offering tax incentives as well as wage and benefit cuts in exchange for keeping the plant open.

Tony Wickersham, a representative for the IAM, told the Kokomo Tribune, “We made proposals to show the company some additional savings that might have them change their minds to stay, and they’re still intent to close. We tried to show them how much savings we could create through different means, but they’re moving the plant.”

Echoing Trump’s national chauvinism, IAM President Robert Martinez sent a letter to Indiana politicians calling Schneider Electric a “French multinational company that has no regard for the talent or skill of American workers in Peru.” Martinez, who receives more than half a million dollars in annual compensation, goes on to cite that IAM members at the plant make an average of $24.55 while workers in Mexico earn $3.49 an hour on average for doing the same work.

Far from fighting to unify US and Mexican workers in a common fight against the multinational corporations, the unions have long peddled economic nationalism to demand endless sacrifices from workers in the name of improving “competitiveness” and corporate profits. The enemies of US workers are not Mexican, Chinese or any other workers, but the capitalist profit system, which subordinates the jobs and living standards of workers for the endless enrichment of wealthy investors and corporate executives.

The company employs 130,000 people in over 100 countries. Last year, workers in India struck against Luminous Power Technologies—owned by Schneider—to fight unsafe working conditions. Maintenance workers employed by Schneider in Australia also struck at the Melbourne Airport against company plans to introduce a two-tier system with new employees hired at a substantially lower wage rate.

Earlier this year, Mexican workers at the maquiladora auto parts and electronics factories carried out strikes in opposition to the company-controlled unions and marched to the US border to unite with their American counterparts. Conditions are arising for a unified, international struggle against plant closings and mass layoffs.