Why is austerity the dominant response
to the global financial crisis and how can it be resisted? How is privatisation
affecting sectors such as health services and education? These and related
questions were discussed at the workshop A
Political Economy of the Privatisation and Internationalisation of Public
Services in a Time of Austerity, held in the Business School of the
University of Hertfordshire on 1 and 2 March 2013. In this post, I will draw on
some of the themes discussed at this workshop.
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| Photo by tomroper |
In her opening statement ‘Crisis as an
Opportunity’ Ursula Huws outlined how capital has used the crisis as an
opportunity to open up the public sector and push for privatisation. 2007 had
constituted a global peak in Mergers & Acquisitions by transnational
corporations (TNCs), indicating an enormous concentration of capital, while the
investment in greenfield sites had declined. This development coincided with
the saturation of outsourced services such as IT services and the related rise
of TNCs in the service sector. The main question for capital was then where to
expand into next? Austerity was the opportunity as it justified the oursourcing
of public sector services as a way of cutting back state expenditure. It
represented a new gold rush for service TNCs, in search for new investment
opportunities. Austerity allowed the EU and IMF to impose privatisation on
Greece and, at the same time, as Marica Frangakis made clear, demand that
parliament should not have a say in relation to already agreed privatisation
deals. Austerity imposed from outside often also involves an undermining of
democratic procedures.
Nevertheless, as the related discussions at the
workshop made clear, the UK too is characterised by processes of opening up the
national health service (NHS) and education to the market, although the UK is
not subject to the same outside pressure as Greece. The main discourse about
the private sector being able to offer services more efficiently and at higher
quality must have become dominant earlier. The workshop participants pointed to
the period of New Labour in government from 1997 to 2010 and the way monitoring
and performance schemes had been introduced in the NHS and education, preparing
the services for private participation. Moreover, it was New Labour, which had
introduced tuition fees in Higher Education and be it only at £3000 per year.
The current government increased the fees of up to £9000 per year, but the key
step was to break with the idea of education as a public good in the first
place. The dominant discourse now regards higher education as a private benefit
to boost one’s earnings rather than a public good. In relation to education,
Andrew McGettigan outlined how privatisation is mainly driven by joint ventures
with private financial capital and the increasing reliance of universities on
private money. In health, discussions at the workshop revealed how cross-border
mobility of patients can result in specialist services being reserved for
foreigners, who can pay, while mobility of health care workers may imply a
brain drain for those countries, which cannot compete with the salaries paid in
other countries.
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| Photo by cpsucsa |
It is, however, not all doom and gloom. As DavidHall indicated, there is a geography of austerity with Asian and Latin American
countries rejecting successfully IMF programmes. Moreover, there are some
examples of re-municipalisation of services across Europe such as water in the
city of Paris, making clear that privatisation processes can be reversed. Only
the fact that some banks had been nationalised, should be treated with caution.
As long as the state did not intervene into the way these banks were run, there
was no real difference to private banks noticeable.
Who are the key agents of these movements of
resistance? Disappointingly, trade unions are often not at the forefront of
struggles. As Judith Clifton mentioned in the case of Spain, the social
movement response to austerity in the form of the occupation movement 15 May or
the Indignados, the peaceful occupation of major squares was not organised by
trade unions. In the Spanish dual labour market, trade unions have mainly
concentrated on defending the rights of those in full and secure employment. A
wider societal dimension was not developed.
Nevertheless, as Christoph Herrmann discussed,
this does not mean that trade unions could not be involved in progressive forms
of resistance. Clearly, the effects of privatisation in the form of job losses
and a deterioration of working and employment conditions has led to tensions
between workers and between public and private sector unions. The general commodification
and marketization in these privatisation processes tends to erode worker and
trade union solidarity. Traditional strategies seem no longer to work. Strikes
often affect service users negatively, without putting pressure on employers.
Concession bargaining can protect established workers at best, successful
struggles at the local level often do not challenge the wider restructuring
policies. While general strikes may paralyse Athens or Madrid, they have little
impact on policy-making in Brussels or Berlin.
And yet, there have been examples of new,
innovative strategies by trade unions against austerity. New forms of service
disruption, for example, in the form of ‘free clinics’ rather than ‘occupied
clinics’ could ensure that there is no division between unions and service
users. As always, trade unions are neither by default the defenders of
privileged conditions of insiders, nor automatically in the vanguard of
resistance. Concrete trade union strategies of resistance only emerge in
processes of class struggle. Considering the current onslaught on services
across the world, these strategies of resistance are more necessary than ever. This
workshop provided an excellent starting-point for reflections on these strategies.
15 March 2013
Prof. Andreas Bieler
Professor of Political Economy
University of Nottingham/UK
Personal website: http://andreasbieler.net
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