Strike at Honda China: Modest Demands, Big Impact

by Paul Garver

I’ve been viewing a video filmed by a striking worker at a Honda transmission plant in Foshan, China, about a hundred miles inland from Hong Kong. You see two buses pulling up to an orderly picket line outside the plant. Several strikers approach the stopped buses, and their young passengers file out. Then the empty buses proceed into the plant.

I believe I may be witnessing a momentous turn in global history.

The 10-day-long strike is not about making a revolution. The workers began by “only” fighting for a wage increase. They were reported to be calm, modest, and ready to end the strike if they win a raise of about $117 a month, which would make their wages comparable to those earned at the four Honda joint venture auto assembly plants in China. Those assembly plants are currently closed down for lack of transmissions.

But then why the alarm in the global financial media?

A news analysis in the New York Times (30 May) wonders if rapidly rising industrial wages in China may disrupt supply lines to companies around the world and discourage future investment by Chinese and global companies alike. Why is Honda reacting with big sticks (firing some workers who joined the strike and issuing a notice to student trainees demanding that they promise not to lead or join any strike or collective action) as well as with carrots (offers to raise total compensation by up to 50%). Why did the Chinese media first freely report on the strike, with the evident toleration of the government, and why did the Chinese coverage of the strike then suddenly disappear?

The official China Daily recently reported on a survey conducted by the All-China Federation of Trade Unions (ACFTU) that showed that the proportion of China’s GDP that went to wages and salaries has declined for 22 consecutive years (from 56.5% in 1983 to 36.7% in 2005), while the share of GDP that went to capital has correspondingly risen by twenty points. 75% of respondents said that the current distribution of income is not fair. In an interview cited by the China Daily and posted on the ACFTU’s web-site, Zhang Jianguo, chief of the ACFTU collective contracts department, warned that “low pay, long working hours and poor working conditions caused conflicts and even mass incidents between labor and management to occur more frequently in recent years, which has already become a major factor affecting current social stability.” For Zhang the solution is collective negotiations, but he admitted that “since many cadres of trade unions fail to adequately protect workers’ rights, it is very difficult to promote more collective contracts to benefit more workers.”

I do think that the Chinese government and its ruling Communist Party realize that wages have to be permitted to rise. This is necessary both to alleviate growing worker unrest (There are almost daily strikes in China, but these are seldom reported), and to fuel domestic consumer demand to reduce excessive reliance on exports. Moreover there is strong support among members of the Chinese elites, especially in academic circles, for the belief that the distribution of wealth and power has become far too skewed), particularly at the expense of the vast army of internal migrant workers. This may be why the Chinese media has reported freely on the suicides of Foxconn electronic workers I reported elsewhere on this blog.

The Honda strike is freaking out both global capital and the Party/State axis because of the potential loss of control over Chinese workers. The strike was not called by the trade union, which the workers dismissed as irrelevant and useless, and which at best could help mediate between workers and employer. This impressive, orderly, and strategically significant collective action is being organized and fought by the young workers themselves, most of them barely out of high school or technical school (up to half are still being being treated and paid as trainees). Demographically they are not so different from the Foxconn workers who are jumping from the windows of high-rise dormitories out of despair. Did they know that by closing the huge and highly automated transmission factory that they would force Honda’s entire auto assembly operation in China to shut down? As Keith Bradsher of the New York Times reminds us, automakers tend to put transmission factories in the most politically stable and strike-free countries. If China is no longer a safe bet, where will they relocate?

Imagine if the hundreds of millions of humbly toiling Chinese workers who are the backbone of the new global economy so profitable for capital were to follow the lead of the Honda workers, and begin to take their collective destinies in their own hands. This is the specter that haunts capitalist and commissar alike. Zheng Qiao, from the China Institute of Industrial Relations in Beijing, optimistically speculates that “such a large-scale, organized strike as the one at Honda will force China’s labor union system to change, to adapt to the market economy.” The change had better come soon. The strikers’ demands are no longer simply about higher wages – they now demand the reinstatement of the fired strike leaders and that the trade union president and other officers be elected by the workers themselves. This qualitative development indicates the growing maturity of the young strikers at Honda.

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3 Responses

  1. […] words? Perhaps with a bit of commentary, hopefully a few hundred words short of a thousand. Background information is here. The middle aged guys in the yellow hats are trade union officers sent by the Nanhai district […]

  2. […] can consolidate their victory by creating a real workplace union to represent them in the future. Background in a previous article on this blog. On May 31, many student interns had resumed work after management compelled teachers at the […]

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