Wednesday, June 3, 2015

Capitalism Just Won't Sit Still

The lead article in Socialist Viewpoint, by Joe Allen, is entitled The Power of Logistics Workers (reprinted from Jacobin). It's a marvelous article--well written, nicely researched, and well worth the read. It has inspired me to purchase the book by Nelson Lichtenstein on The Retail Revolution--with any luck I'll review it here soon.

Mr. Allen's thesis is that logistics, embodied by companies like FedEx and UPS, represents a choke point in the US economy, and therefore an opportunity for working class activism. Logistics workers today have a power that was once held by auto and steel workers. Of course he has a point, and it's odd in this context that he doesn't mention the recent port disruptions on the West Coast. There a few hundred workers put the screws on the entire global economy.

Still, as Mr. Allen admits, organizing FedEx is not going to be easy. A large percentage of the employees are part-time and the turnover rate is very high. At UPS the problem is slightly different--while the full-time employees are all Teamsters, the 1997 strike against the company ended in a draw. Since then not much has happened. Also, the large number of casual, seasonal workers are non-union.

Mr. Allen takes an expansive view of logistics:
Sociologists Edna Bonacich and Khaleelah Hardie argue that logistics has two interrelated meanings. The first is the “nuts-and-bolts distribution function” that we generally associate with the word. But the other refers to “the management of the supply chain, including the relations between retailers, their producers/suppliers, and their carrier/transportation providers.”
While it used to be that manufacturers determined what got sold and when, now it is the retailer who makes those decisions. Mr. Allen accurately credits Walmart with this revolution
Wal-Mart, from its world headquarters in Bentonville, Arkansas, “cut out a raft of salesmen, jobbers, and other supply chain middlemen, squeezed the manufacturers by shifting every imaginable cost, risk, and penalty onto their books [and has] taught the entire retail world,” according to historian Nelson Lichtenstein, “how the bar code and data warehouse could finally put real money on the bottom line.”
Mr. Allen should go on to say that ultimately it is consumers who benefited--they got better products delivered in a timely fashion at cheaper prices. Always Low Prices, as the saying goes.

That, however, is not the major flaw with Mr. Allen's thesis. A hint to the real issue is found in this excerpt.
The production of capital goods (machines and tools for manufacturing) and consumer goods (for personal consumption) has been and will be central to the capitalist system. Every generation or so, however, capital reorganizes its methods of production and circulation (what bourgeois economists call distribution) and in the process remakes the composition of the industrial working class. 
These changes can be painful and disorienting, and it can take a significant amount of time for socialists and other working-class activists to reorient themselves. This remaking includes modernization of production techniques (the means of production), the organization of production and labor management, the methods of transporting goods to the market, and how goods are actually sold to the consumer.
Two glaring problems stand out. First, that events are cyclic--every generation or so. Capitalists do this out of boredom, we suppose, or perhaps because Mars is in Sagittarius. Mr. Allen forgets that capitalists don't like these painful and disorienting changes any more than workers do--just ask Eddie Lampert, owner of the now combined Sears and K-Mart chains. Bourgeois economists call it creative destruction.

The second problem is the belief that the disorienting changes are behind us for this generation. Mr. Allen just assumes that the logistics revolution of the 1990s and the aughts is over, and now we workers have time to readjust, unionize FedEx, and fight for our fair slice of the pie.

How quaint. And how wrong. For the logistics revolution that Mr. Allen describes--goods manufactured in China shipped just-in-time to your local Walmart store--is as passe as last year's Christmas tree.

Has he not heard that manufacturing is booming in these United States? Textiles, in particular, are coming back. Instead of being assembled by low wage workers in China or Bangladesh, instead they're sewn together by robots in North Carolina. Why? Not just because it's cheaper, though that, too. The cost of shipping the product halfway round the world is saved.

Rather, clothes can be made just-in-time and to order. I don't mean orders from Walmart--I mean the order from Kathy in Pocatello. You know--the lady with the big butt and the tiny feet. The old logistics revolution (i.e., from a decade ago) cut out a raft of salesmen, jobbers, and other supply chain middlemen. But now the retailer is getting squeezed out--products move one at a time from the manufacturer direct to the consumer.

So much for that big, FedEx operation in Memphis, moving mass-market merchandise from one continent to the other. No, not anymore. Today it's the small, contract manufacturer in Boise shipping products all the way to Pocatello. Kathy will get her new, custom-designed, perfectly-tailored dress by tomorrow morning.

Mr. Allen informs us that UPS has 395,000 employees. FedEx employs about 300,000. Does he believe that either of these companies will hire as many people ten years from now? While logistics will still be important, it will look very different than it does today. It won't be organized around a central location in Memphis, relatively easy to unionize.

So Mr. Allen and his doughty band of union organizers better get hopping. They've got at most a decade to organize that Memphis facility before it goes extinct. Because creative destruction isn't a generational thing. Indeed, you ain't seen nothing yet. Our economy and our world is changing faster than Mr. Allen can keep up.

Further Reading:

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