Italy, november 2004

The USA therapy to resume the german competitiveness

"Germany must learn by America,where there's a big percentage of employed, but lower wages, a longer working time but worse conditions, and the social services are almost completely absent...we must make a cut of the 20% in the gross wages, if we want to go back to the Full Employment"
This is the formula as proposed by Norbert Walter, already manager of the Institut fr Weltwirtschaft in Kiel and now head of the economic researches department of the Deutsche Bank. A formula that also Schroeder has done its, claiming that working more is necessary to absorb the unemployment.
There's nothing to say, the State is learning by the "american lesson", like Confindustria and Bundesbank, as shown by the offensive against "the high cost of the work", developed reforming the insurance institutes and the illness indemnity, using the fiscal lever to move wealth towards the capital, raising the interest rates to impose a steady wage moderation; cutting the concern staffs ruthlessly; moving productions abroad; emptying the collective labour agreements; deregulating the work market.
This general state of precariousness about conditions and working relationships, increased for effect of a capitalistic use of the german reunification; after a series of workers' agitations in the eastern Laenders and after a shy step towards the reunification between the workers' material conditions and forms of organization, the German middle class have not been still to look; granted the east the unavoidable wage rise for the first years, then it used the good abilities and the lowest wages of the eastern german workers (and all the eastern European workers too) as arms of blackmail against the western german workers, more and more.
And the blackmail showed itself effective, also about the working time; even the western enterprises of the engineering sector, like the Kassel Viessman, the Lubecca Drager, the Dasa of Hamburg or the Munich Sinitec-Siemens, deliberated the not paid lenghtening of the working time, with the hard return at the thirty-eight or forty working hours. And if it's true that, on one hand, the thirty-five hours of the metalworkers and the typographic ones are the result only and exclusively of a hard season of struggles, on the other, it's true that from long time the effective working time for the full-time employed in Germany, stands beyond the forty weekly hours.
Already in 1999, in spite of the general password "work less to work everybody", only a little more than 15% of the full-time workers was working according to the standard times - thirty-five or forty weekly hours for five working days.
Actually, the business shift -the increase of the working hours- has a strong ideological meaning, given that many factories are not working to the maximum of their capacities at all.
So, a widespread extension of the working time, will go to detriment of the number of jobs and before the creation (economic situation allowing) of new ones by the reduction of the costs. The material attack suffered by the workers of the big-middle factories -that obtained on the paper the thirty-five hours- is more stronger; this introduction was accompanied by an owners' aggression without a break on all the unifying elements of the working conditions: new turns, flexibility of the working times, based on the unquestionable business needs, a growing pressure to change every saturday -and sunday- in a normal working day, personalization of the working time with the diffusion of the time Banks, application of not-payed overtimes, a methodical use of the internal and external subcontracts, a permanent company managements' war to take possession of every smallest splits of second, the imposition of a working time calculation not based on the hours of presence in the factory, but on the effective time at the production (1).

The Siemens "icebreaker" agreement
In the agreement of this spring on the collective engineering wage settlement (this sector employes 3,5 millions of german workers), was added a "deviant" clause; it made easier the avoidance of the national collective wage agreements to benefits of an higher flexibility of the work.
Before the agreement of this year, was possible to deviate the craft wage agreements only in case of heavy crisis of the company or of a situation that needs a re-organization to face up a real risk of bankrupt.
Then, become possible to deviate generically the agreement to "improve the productivity, the investment's and innovation's conditions, to protect the current employment and to create new jobs".
The agreement explicitly provides the increase or the cut in the working hours (with or without the wage rise), the cut in bonus or additional payments (payed absences, year-end bonus) and the delay of specific benefits. The dispensations must have the approval of the company unions or sector unions, but they are an important "picklock" for the companies to open the contractual stiffness.
The Siemens case in Rhineland was a first important example. With the menace of a production's transfer on Hungary (where the wages are 1/5 of the german ones), IG Metall and the Siemens company management agreed to change the working time from thirty-five to forty hours a week, without wage adjustment, for about 4500 workers of the handly and cordless production of two factories (Kamp-Lintfort and Bocholt).
The allowances, the paid holidays and the Christmas holidays will be replaced by a bonus based on the business trend.
In all, the gross income of the workers is cutted down of the 15%.
By way of compensation, the Siemens, that looks at a reduction of the labour costs of the 30% with the agreement, assures the employment for two years and announces 30 millions of euros of new investments on both areas.
Considered that the labour cost share, compared with the overall production costs of a cell-phone, is between the 8% and the 15%, the advantages of a production abroad are not much considerable (in this case, in Hungary the Siemens could save 5 euros for handy); other items have a decisive role, like the fiscal rates, the subsidies level and, first of all, the productivity degree.
"Considered that the Siemens group has 16700 employees, it constitutes a precedent and an epoch-cut on the economic history of the German Federal Republic", as "Der Spiegel" said on 28th of April. The IG Metall secretary, Jurgen Peters, was quick to specify that the Siemens agreement is a "bitter pill", but it comes from a particular circumstance. And he added that "if someone want to generalize its application, must settle scores with the trade union".
But these declarations clash with the opinion of the Wsi, the research institute of Dgb (another important Trade Union Congress), that declares the effective average working time of 39,9 hours, quite above the 37,7 average weekly hours provided by the collective agreements.
It's clear that the dispute is more about the labour cost that on the working time.
Really, more factories, especially on the engineering-electrical sector (but also on building trade and tourism, like the multinational Thomas Cook: it's the second tour operator of Europe; the 23 of July it declared that 2000 of its workers will work 40 hours beginning on the first of August and the wage rise, foreseen on July, will slide for 18 months, to the first of January 2006), are contracting particular solutions like the Siemens ones, but the workers are prudent to comment upon this solution (not like the politicians; the opposition became enthusiastic of it and the centre-left coalition government expressed a positive judgment on it): "Now, it's not the question of a widespread extension of something that many people don't need", said the president of the german Federmeccanica, Martin Kannegiesser.
Heinrich Pierer, president of Siemens, even if he considered that the agreement can be applied on other similar local situations, remarkes that it's a univocal case, re-conferming the validity of the collective agreement.
In the opinion of Dieter Hund, the responsible of the owners' union (Bda), the working time doesn't need a re-negotiation with big agreements for everybody or by sectors, but it must be examined by the mangements and adapted to the business situations: "I think that something that stands between a little more above the 30 hours and at the most about the 40 hours (or little more), constitutes a good ground of discussion", he said before the Siemens agreement, conferming that the ideal solution for the concerns, often planned with the trade unions, is the increase of the flexibility adapted by case to case.
It's true that the additional agreements and the clauses of deviation make possible the adoption of solutions like the Siemens, in accordance with the principle of the exchange between the not-paid additional work and the maintenance of the employment.
On the chemical sector -in a full accordance with the trade unions- it is a steady practice (as the tyres maker Conti does).
But it's also true the opposite; recently, at the Deutsche Telekom, the working times are cutted down to prevent the dismissals.
It's the same at the Opel, in the Russelsheim plant -that works on a reduced speed- where the working time stands on the 30 hours with the wage cut for the workers in the chain and the clerks work more renouncing to a part of the wage.
Amongst the european country, Germany is the one where General Motors sells more and where produces the majority of its cars just with the Opel.
"We have an excess of capacity (besides like many cars producers) and there are areas in wich we are not competitive -says Henderson, president of the GM european branch- but the measures will not be like the ones of the other german groups, like Siemens. The increase in the working hours cannot be enough if there's a real excess of capacity". (2)
If BMW didn't choose to build the new factory in the Czech Republic, but in Lipsia, that's also because it was able to set up a more flexible way of production with the support of the collective agreement. The internal commission created a shift work allowing an "optimal" explotation of the expensive industrial facilities: 38,5 hours a week is the average working time for every single worker, but the factory can work between the 60 and 140 hours. "The point -says the factory manager, Peter Claussen- is not how much time a single worker spends on the chain but how long the machines work".
The quoted examples show that the basic purpose is always to cut down the costs, not only increasing or the working hours, but in according with the situations, often different by business to business, by sector to sector and also with the kind of workers.

Daimler Chrysler and Volkswagen: the blackmail of the transfer
The security of the occupation and a "freeze" of the threatened transfer are the basic ingredients of the historical agreement between the Daimler Chrysler and the IG Metall.
This compromise assures the preservation of 6600 places of work in the Sindelfingen factories untill 2012; it came when the company, after a workers' struggle that blocked the production in some factories of the Stuttgart group, threatened the transfer of the most profitable facilities of Bremen and East London to the South Africa.
The agreement is brazenly in favour of the company: it provides for the chance to work till 40 weekly hours, for those attached to the development and the planning; for a 20% wages cut in some services, like the canteen or the security, but only for the new workers, whose contracts will be not covered by the IG Metall; finally, it provides for the utilization -based on the plants' demand- of young workers' groups, with stated time contracts regulated by an internal job centre and a reduction of the wage rises of the collective agreement (3)
The deterrent of a transfer of the production in countries where there is a lower cost of the work, a costant and gradual moving back of the trade unions -involved in a perverse logic of joint management to protect of the european productivity more and more-, proved extremely funtional to obtain a more contractual flexibility and could be decisive for the negotiations about the renew of the Volkswagen contract.
IG Metall claims a 4% wage rise in two years with the warranty of the occupation for 100000 workers of six factories for ten years to the proposal of a wage freeze showed by the management as the only way out of the dismissals of 30000 workers.
Even if in the first step of the negotiations VW doesn't make explicit the menace of the trasfer, it's a fact that the group has from long time facilities in Czech republic, Slovakia and in Latin America; when it has in production a new car, it launches a sort of internal tender in the factories and chooses the most favourable "package" in terms of flexibility and working costs.
Into 1994, the VW was forced to propose a week of 28,8 working hours, in reply to the worse crisis on its history, preventing so the dismissal of 30000 workers: really, this was a temporary reduction of the working time to increase permanentely the flexibility, to intensify the working services and to break up the workers union.(4)
In spite of the big increase of the productivity of the work happened in the german factories, the management of the VW, already in 2000 took the plants abroad like the Resende's one in Brazil o Mosel in Saxony as models, to apply and surmount the useful experiment carried out at home.(5)
At the moment, the stagnation of the market demand, in particularly on German, the currency appreciation of the Euro and the reduction of the profit margins on China -because of the increasing competition of the foreign producers- are the elements of a new time of crisis for the VW.
The proposals elaborated by the personnel manager Peter Hartz and presented to the trade union, form part of a Wolfsburg's plan to cut the working costs of the 30% within 2011.
At the moment it's not clear what kind of fllexibility VW will introduce, besides the flexibility already tested by various models of work elaborated during years just by Hartz: from the quoted four-days week, introduced at the middle of the nineties, to the "5000 for 5000" formula by which 5000 unemployed persons were engaged for 5000 marks each for them, with working times longer that the ones provided by the standard contract to start up the production of the Touran space wagon on competitive costs.
The trend is to increase the times under equal pays, on the basis of the DaimlerChrysler and Siemens agreements.
The problem of the VW is that a lot of the german plants are working below the real production capacity (70% in Wolfsburg); so, a general increase of the hours will mean automatically excesses for thousands of workers.

The Schroeder's turn of the screw
The German Chancellor's statements about the role of Germany in the international game came early the next welfare reform, the most radical from the postwar period up till now.
Schoroeder, stressing the foreign policy and mentioning the war missions of the Bundeswehr in Afghanistan, in the Balkans, and in Iraq as regards the drilling of the local troops, made it clear that, if the UN reform accomplishes -that means a broadering to new countries, Germany will claim the right to have a standing seat in the Security Council.
Statements used as pretexts that announce the cuts in social security. The project, that was already approved by the Parliament and that will come into force the first of January, caused many protests in East Germany where the unemployed are the 18,5% of the working population (the national rate is about 10%).
The purpose of the reform is to cut the social expenditure and force the long time unemployed (about 2,5 millions on 4,4 millions people total) to find a job instead of depending on the unemployment benefits. By the way, the package provides for a cut in the benefits' total costs and duration: from the first of January 2005, the benefits for who is unemployed from long time (more than 12 months) will be not calculated on the wages previously received (the 53-57% of the basic wage), but on a fixed amount, 345 euros a month in West Germany and 331 euros in East Germany.
The reform makes the unemployed unable to reject a job, even if it's not up to their abilities, even if it requires commuting or if the wage is less than the minimum settled. In this sense, said W.Clement, Minister o Economy, Hartz package provides one or two euros an hour jobs(!!!) with the addition of government subsidies to make a respectable wage.
In the opinion of Clement this measure could concern up to 600000 people, the 20% of the long time unemployed.
Like the other three forms of the Hartz reform (see Senza Censura n.11, june 2003), the fourth one represents a decisive step in the reorganization plans of the german factories and a trend for the Europe, first of all for the industrialized areas.
The "enlightening" opinion of S. Gattegno, managing director of Alcatel Italia (french multinational group, leader in the broad band with its four productive plants in Italy and 3000 employed) about Italy, is that the increase of the equal-pay working hours is a chance that doesn't resolve on its own the problem of the resumption of the competitiveness. "We need -says the boss of the Alcatel - a more diversified policy on the working questions that allows to face up the problem with more attention to the different sectors and territories. We must continue to go on the way of the work flexibility -boosted by the Biagi Law-, making attention to the current debate on the bargaining and to the different areas of the nation.
The flexibility, the increase in working time, the menace of the transfer are instruments that don't clashes among themselves and will serve us to break the european contractual rigidities."
In other word, the new EU superintendent on economic and monetary affairs, Joaquin Almunia, in a summit in Bruxelles, says that the european model deals with the challenges of the stagnation of the market, of the ageing of the population, of the chronic unemployment in some areas, of the competitive pressures of the new eastern members and of the competition of the Asian giants, China and India.
To come the most dynamic area of the world before 2010, as rerequested four years ago in Lisbon by the heads of State and Governement of the fifteen countries, the Europe must get on with more competitiveness, more investiments on the technologic areas and also with more working hours. "The variable of the working time -he finished- can be an essential factor to restore the shine of the economic growth of the the Old Continent"

(1) In particular, the introduction of working times " la carte" and the Zeitkonten. The times " la carte", not only lead a cut of the downtimes of the industrial work (the factories can dismiss in case of downturns in production), but also an increase in work intensity and in the "invisible" additional hours. Besides, this kind of times make the 35 hours reduction vain, because the workers must be instantly ready to stop and restart working, and unable to plan their time off. The Zeitkonten introduction (time calculations or Banks of the time) will give to all the workers of a factory -or to a single worker- a time card to mark their credits (the additional working hours); they cannot ask for the payment of the additional working hours, but they can only exchange the credits in a space of time with a same number of time-off hours. The Zeitkonten institute turns to the advantage of the factories because they can change the production times according to the market demands, preventing so other employments and the extra wages for the additional hours. For the workers this would mean "more chances to plan their time". But these are completely theoretical chances: when is needed an increase in the production, they cannot hope for compensatory permissions. The space of time to make the exchange is drawing out continuously: in the beginning it was limited in two months, then it has been extended to one year, then to a long term and finally VW start to mortgage the retirement's years.
(2) GM want to make the most of a production area near Germany: Poland (where there is also the Fiat group). Opel recently chose just Poland -and not the german factory of Russelsheim- as site for the production of the new model of the station wagon Zafira. "For the moment -says J.Browning, marketing manager for GM in Europe-, that's not a simple transfer, 'cause the investiments will be direct on the countries with a high growth rate".
(3) As regard as the bits given to the workers, there is still the so-called "Steinkuehler", a 5 minutes break for each working hour: really, it will be piling up to a hours timing that will be used for the vocational training.
(4) In VW is not been applied a simple cut in working hours, but a general re-organization of the production process and of the working time, with the extension of the turns, of the night and holiday shifts, of the mobility (in the single factory and amongst the factories) and, finally, of the overtime work, needed by the company and also by the workers, even in the week-ends, as partial compensation for the cut in wages. Other important elements of the VW restructuring were the strong increase of the rate of work and, since 1993, the voluntary or forced occupational decrease of the 25% of the workers, amongst early retirements, turn-over blockage and transfers; so the agreement doesn't protect, as promised, the places of work either.
(5) In Resende, a small plant for the trucks production, the VW hasn't workers, the whole plant work by subcontracts in competition amongst themselves and without any presence of the trade unions. In Mosel, the big utilization of small subcontract factories has been combined with the latest technological inventions and the increase in working services, already both experimented in Wolfsburg and Hannover, to halve the Golf production times.