Those paragons of democracy, US corporations, want to treat workers worse than the commie Chinese

Democracy's Enemies
America's leading corporations appear even more committed to surpressing the rights of workers in China than the communist regime is.
By Harold Meyerson/American Prospect

Listen to the apostles of free trade, and you'll learn that once consumer choice comes to authoritarian regimes, democracy is sure to follow. Call it the Starbucks rule: Situate enough Starbucks around Shanghai, and the Communist Party's control will crumble like dunked biscotti.

As a theory of revolution, the Starbucks rule leaves a lot to be desired.

Shanghai is swimming in Starbucks, yet, as James Mann notes in The China Fantasy, his new book on the non-democratization of China, the regime soldiers on. Conversely, the American farmers who made our revolution didn't have much in the way of consumer choice, yet they managed to free themselves from the British. In New England, however, they did have town meetings, which may be a surer guide to the coming of democratic change. It's a growing civil society -- a sphere where people can deliberate and decide on more than their coffee -- that more characteristically sounds the death knell of dictatorships.

Which is why the conduct of America's corporate titans in China is so disquieting. There, since March of last year, the government has been considering a labor law that promises a smidgen of increase in workers' rights. And since March of last year, the American businesses so mightily invested in China have mightily fought it.

Beyond the Starbucks of Shanghai, the China of workers and peasants is a sea of unrest, roiled by thousands of strikes and protests that the regime routinely represses. Cognizant that they need to do something to quell the causes of unrest, some of China's rulers have entertained modest changes to the country's labor law. The legislation wouldn't allow workers to form independent trade unions or grant them the right to strike -- this is, after all, a communist regime. It would, however, require employers to provide employees, either individually or collectively, with written contracts. It would allow employees to change jobs within their industries or get jobs in related industries in other regions; employers have hitherto been able to thwart this by invoking statutes on proprietary information. It would also require that companies bargain with worker representatives over health and safety conditions.

It's not as if Chinese unions would use these laws to run roughshod over employers. Chinese unions are not, strictly speaking, unions at all. They remain controlled by the Communist Party. Their locals can be and frequently are headed by plant managers, whether the workers want them or not. And yet, these changes proved too radical for America's leading corporations.

As documented by Global Labor Strategies, a U.S.-based nonprofit organization headed by longtime labor activists, the American Chamber of Commerce in Shanghai and the U.S.-China Business Council embarked on a major campaign to kill these tepid reforms. Last April, one month after the legislation was first floated, the chamber sent a 42-page document to the Chinese government on behalf of its 1,300 members -- including General Electric, Microsoft, Dell, Ford, and dozens of other household brand names -- objecting to these minimal increases in worker power. In its public comments on the proposed law, GE declared that it strongly preferred "consultation" with workers to "securing worker representative approval" on a range of its labor practices.

Based on a second draft of the law, completed in December, it looks like American businesses have substantially prevailed. Key provisions were weakened; if an employer elects not to issue written contracts, workers are guaranteed only the wages of similar employees -- with the employer apparently free to define who, exactly, is similar. Business is relieved: Facing "increased pressure to allow the establishment of unions in companies," Andreas Lauff, a Hong Kong-based corporate attorney, wrote in the January 30 Financial Times , "comments from the business community appear to have had an impact." The new draft "scaled back protections for employees and sharply curtailed the role of unions."

Phew!

Admittedly, a few nettlesome issues remain. First, about one-fourth of the global labor force is in China. Opposing steps toward the formation of unions there suppresses the wages of so many workers that its effect is felt worldwide. Second, since authoritarian China remains an adversary of the United States and a backer of some genuinely dangerous authoritarian regimes, blocking even the most modest steps toward the development of a civil society and democratic rights there poses a threat to U.S. security interests. Third, since the Bush administration champions the spread of democracy globally, why hasn't it taken America's leading corporations to task for retarding democracy's growth in China? And fourth, since preserving our national security should require executives at companies such as GE to answer for their conduct, where's the House Un-American Activities Committee now that we really need it?

(Harold Meyerson is acting executive editor of The American Prospect. A version of this column originally appeared in The Washington Post.)