“Renato Cappucci has swapped the romantic town of Monza for a unit on the Carrs Industrial Estate in Haslingden. The one-time manager of Formula One racing team Minardi left behind the glamour of the grand prix circuits to set up the UK arm of the high-performance brakes manufacturer TAR-OX. Here, he pits a great philosopher against today’s money-men to prove that opting for immediate returns doesn’t always lead to long-term gains.” – Lancashire Business View
Karl Marx walks into a modern day factory in China and is clearly not impressed to see the conditions of workers.
“Bloomin ‘eck,” he exclaims, “almost 150 years since I wrote Das Kapital workers are still brutally exploited in sweatshops. Workers of China unite, let’s have a Communist revolution!”
It sounds like the beginning of a political joke, but it isn’t.
Admittedly, we could imagine an innocent bystander telling the German philosopher that actually the whole country has been ruled by the Communist Party for 60 years, and perhaps smiling at his em- barrassment, but there is no punchline here that will generate laughs. If, on the other hand, Karl Marx visited 21st Century London he would see an awful lot of changes in the working conditions since he co-wrote with Engels the Communist Manifesto.
There is a minimum salary, it is illegal to make children work, in fact they are provided with free education; motherhood is protected, facto- ries are nicer places to work and the Government pays welfare money to unemployed people, even if they don’t try too hard to get a job.
So we have two paradoxical situations. If Marx visited China he would be unimpressed to see the conditions of workers, even if the country is currently ruled by a Communist party of obvious Marxist inspiration.
And if he could see the conditions of workers in most western countries perhaps he would be impressed by what he would see.
It is now 20 years since the Berlin Wall was pulled down and on that day in November 1989 it was obvious that capitalism – albeit not perfect itself– had no credible alternatives.
With all this in mind it would be unfair to underestimate the influence of socialism on the improvement of the standard of living many people now have.
All the fights for higher wages, better working environment, equal opportunities and a fairer deal for workers could not have happened without a relentless, ideologically organised pressure.
And the bosses – although reluctant to part from their cherished profits – eventually found it more convenient to give up a little bit of surplus money than face industrial unrest.
I could add that since the fall of Berlin Wall, capitalism without the demands of an antithetic system has become self indulgent.Wall Street brokers became masters of universe, the Black-Scholes model and the notion that
you can trade a share indefinitely and risk free if
you make the right calculations became the gospel of a new economy. Generous dividends had to be paid to shareholders and if there was no money for research and development, who cared? Manufacturing became the poor relative, something to be relocated in remote places, while the service sector – anything that would not soil your hands – appeared to be the way to go.
The case of Fiat is exemplary. At the end of the 1980’s they decided to branch out from their core business – making nice little cars – and de- cided to diversify, buying shares of capital intensive business, including insurance, thus subtracting resources from its automotive division.
As a result they started making crap cars and a decade later they were on the verge of collapse until a change of management made sure that it reverted to doing what it knew best: nice little cars.
The role of the watchdog could have been easily played by trade unions but, for some reason, they failed to deliver. Generally regarded as important stakeholders they are always consulted –and listen – when the future of a organisation is a stake.
The problem is they appear to play by the book instead of looking at the bigger picture.
When BMW sold Rover, unions supported the consortium that promised to maintain employment levels instead of those who wanted to make the company competitive. Experience shows that when companies are kept artificially alive, sooner or later they will collapse with even more serious consequences.
So, for the sake of saving a few hundred jobs at the time, 5,000 of them were lost a few years later. I wonder why unions did not think of trading redundancy for training.
I am reliably informed that – for example – body work staff can be realistically transformed into sought-after CNC machine operators within about six months.
You don’t need to be an economist to understand the difference between the expense of 50 weeksnof training and the cost – emotional and financial – of long term unemployment .
And such a suggestion is not the solution of a complicated economic equation, just the application of the old Chinese adage: “If you give a man a fish you feed him for a day, if you teach him how to fish you feed him for life”.