WFTU’s position on Transnational Corporations (TNC’s)
The transnationals’ stabilized their presence in the imperialist state of capitalism.
What is imperialism?
For Lenin, imperialism has the following characteristics:
1. Accumulation of capital and production in such high level of growth that monopolies are created which play decisive role in the economic life.
2. The merging of the bank capital with the industrial capital and creation of a financial oligarchy based on the “financial capital”.
3. The export of capital has great significance in comparison to the export of goods.
4. International imperialist mechanisms are being founded that divide the world.
5. Monopoly capital, with the aid of its imperialist governments completes the division of the earth’s territories amongst themselves.
What are the monopolies?
One of the basic characteristics of capital is the huge industrial growth and the extremely fast process of accumulation of production in larger enterprises.
This means the concentration of capital, i.e. increasingly fewer producers remain in the market as monopolies grow, accompanied increasing rate of productivity and decreasing number of workers.
We use the term “monopoly” because a few dozens of dominant enterprises world-wide can directly come to agreements when it is necessary in order to dominate the market. This gives them power to impose prices and therefore create the monopoly tendency.
These enterprises combine different sectors of the economy or successive levels of the production or secondary procedures around the production (e.g. recycling)
Professor Hermann Levi wrote in a study in 1909 (!):
“ In Great Britain it is the size of the enterprise and its high technical level which harbour a monopolist tendency. This, for one thing, is due to the great investment of capital per enterprise, which gives rise to increasing demands for new capital for the new enterprises and thereby renders their launching more difficult. Moreover (and this seems to us to be the more important point), every new enterprise that wants to keep pace with the gigantic enterprises that have been formed by concentration would here produce such an enormous quantity of surplus goods that it could dispose of them only by being able to sell them profitably as a result of an enormous increase in demand; otherwise, this surplus would force prices down to a level that would be unprofitable both for the new enterprise and for the monopoly combines.”
Historically the appearance of monopolies is defined in the 1860-1880 in the upper level of the development of free competitiveness. The monopolies in this period are embryos that are just making their appearance. After the 1873 crisis we see the long period of the development of cartels which are not yet stable, as they are still an exception.
The growth in the end of the 19th century and the crisis of 1900-1903 bring the cartels to the fore, they increasingly become the main feature of capitalism in the 20th century. Capitalism enters its imperialist state.
What are the cartels?
The cartels are agreements between rival enterprises usually in homogenous productions (e.g. dairy products). The cartels close deals for the terms of sale, the payment deadlines, etc. They divide the sale territories or markets amongst themselves. They define the quantity of products that must be produced in order to keep the prices high. They define the prices. They distribute the profits amongst the affiliated enterprises.
There have been private and public cartels without any major differences in their activity. The more gigantic the enterprises get the easier it is for them to come to agreements and form cartels. This is also facilitated when the cartels control the raw materials.
Several economic studies and legal decisions of antitrust authorities have found that the median price increase achieved by cartels in the last 200 years is around 25%. Private international cartels (those with participants from two or more nations) had an average price increase of 28%, whereas domestic cartels averaged 18%.
A 2005 research has shown that in 1991-2004 there were 49 national and 137 international cartels. 17 of which were legally operating according to the regulations for the “free competition”.
The role of the banks is highly important in this procedure. The banks don’t have the role of the mediator anymore as they have themselves now become monopolists. The banks possess the whole financial capital of the capitalists and the households as well as most of the means of production and the resources of raw materials in a country.
According to the 2012 data the top 50 banks hold assets of about 60 trillion dollars.
The banks hold also the absolute knowledge of the actual situation in the world-wide capitalist system and can control, enhance or intervene in any market or sector.
We must also not undermine the role of the state. Nowadays, there are more than 650 state-owned transnational corporations.
The competitiveness is transformed into monopoly. The production is being socialized.
There is no free competition of scattered enterprises, unknown to one another that produce for an unknown market. To a great extent the accumulation makes the calculation and estimation of all the raw materials in a country and the world possible. There can be an estimation of the size of the market and the demand.
Another feature of monopoly capital is the increased socialization of production whilst there is increased concentration of ownership. In other words, for a product to be produced, thousands of workers in different parts of the planet work on different levels of the production. This includes the division of the value chain across countries.
Take for example a car. From the collection of the raw materials, the transport of the raw materials, the primary and secondary treatment, the transmutation, the production of the machinery that will be used in the production of the car, the fitting of the different parts and the trade. A car may start as a metal from Australia, as a lid from India, to be fitted in Germany and sold in Egypt.
The production is being socialized. However the product and the profit is owned by a few individuals around the world who keep on holding the prices high. Despite the great scientific and technological development and the produced wealth, the working class and the poor popular strata cannot fulfill their basic needs.
WFTU International Action Day: 3rd October 2012
We are targeting the core of capitalism: in other words the action and operations of the transnational corporations and touching the heart of the problems faced by of the working class and the poor popular strata. This includes demands focused on the satisfaction of the basic needs of the working class and the poor in general; as a fighting class oriented movement of workers, the WFTU is organizing on October 3rd 2012 an International Action Day.
In this International Action Day we focus on the following basic needs:
Food – Water – Medicine – Education – Housing.
Our struggle is also geared at ensuring that these demands are met in qualitative manner, to ensure that the services are provided in low prices or free for all the people.
Our demands are realistic and necessary:
- The wealth-producing resources of each country (miners, water etc.) are being looted by the transnationals’ causing only poverty, hunger and suffering for the people. How is it possible to privately own water resources, especially as an international monopoly. This vital resource for human survival is allowed by the governments to be privatized and become a means for profiting and in many occasions with deterrent price.
Αbout 884 million people have no access to safe clean water and about three times as many, about the 39% of the global population – mainly in Africa and in Asia – have no access to basic sanitation facilities
- Without the working class nothing could be produced. From the collection of the raw materials to their treatment, until the final product, the transport and the trade, the working class is and irreplaceable force that produces surplus value.
- Because the contemporary scientific and technological progress as well as the high productivity is such that all the needs of the people can be satisfied.
- It is the action of the transnationals’ that keeps the prices high, that blocks the evolution of the productive forces (destroys products, crops, stops the production etc.)
According to FAO’s estimation, with the so called “conventional” agriculture and the existing climate and weather conditions, the production of agricultural products could be sufficient enough to satisfy the nutritional needs of a population twice as big as the existing one.
At the same period when the “market” is supposed to be saturated and large amounts are being destroyed or subsidies are being provided for the reduction of production (i.e. given to farmers for them to stop the production) in order to keep the prices high more than 850 million people are undernourished or starving because their income prevents them from obtaining proper sustenance.
- The action of the transnationals’ is dangerous for the public health and the environment whilst obeying the ultimate law of profiting.
The drug companies who owned the patent for Aids drugs went to court to stop the post-Apartheid government of South Africa producing generic copies of it – which are just as effective – for $100 a year to save their dying citizens. They wanted them to pay the full $10,000 a year to buy the branded version – or nothing. In the poor world, the patenting system every day puts medicines beyond the reach of sick people.
- The huge amounts of profits of the transnationals’ are such that the suffering of the Third World people can be prevented, that the private ownership is the stumbling block that stops the social progress and welfare.
In the current condition of the capitalist crisis most companies keep on being profitable more or less in comparison to the pre-crisis levels. The competition amongst them and the logic “the larger fish eats the smaller fish” destroys some productive forces.
In 2010 amidst the capitalist crisis, the 50 more profitable companies in USA only, earned profits more than 715 billion dollars.
On the contrary. 16% of the total population is undernourished.
1 out of 6 people worldwide do not have access to adequate clean water.
More than 100 million people are homeless. Millions live in slums. Hundreds of millions of people live on rent or have to pay unbearable house loans in order to get their own home.
920 million people remain illiterate.
8,1 million children died in 2009 before reaching five years of age.
Each year about 2,1 million people around the world die from vaccine-preventable diseases.
The workers’ rights in decent basic salary, social security, free and qualitative public services (education, healthcare, transport, electricity) are being undermined and attacked.
The freedom of association and the trade union freedoms in general are being attacked.
- Because in the current conditions of global capitalism in various countries there should be such a movement that will block the anti-labour policies, it can make the capitalist maneuvers and right-wing measures more difficult to implement, it can gain temporary gains in favor of the working people if only it has a strategy of direct conflict with the monopolies.
In order to fight with “giants” you need a gigantic movement. The WFTU is trying to build this movement: with stable feet on the work places and with a “clear head” that will study the enemy and will prepare the organization of the working class for a strong militant class struggle using all forms of struggle.
Amongst the forms of struggle we believe that strikes are of a great importance and efficiency because it affects the heart of capitalism: the profit. However all forms of struggle that can promote our goals can be useful in various times, depending on the situation.
We call upon all the trade union organizations around the world, members and non-members of WFTU to organize actions in their countries, to “bring to trial” the transnationals’ symbolically, to organize an International Action Day as a united voice of the international working class.