With the global overproduction in steel leaving Tata making a massive ongoing loss on its British operations, the prospects for Tata workers are bleak – as they are for steel workers all over the world. For the asset-strippers, however, the disintegration of the steel industry offers potential rich pickings.
The government’s promise to acquire a 25 percent stake in any potential buy-out, plus hundreds of millions in support, offers a tasty bribe without any kind of public accountability, whilst the possibility of shuffling Tata’s pension liabilities off into the Pension Protection Fund will slash benefits for thousands of workers by an average of 20 percent.
“Companies that have bought assets from Tata have not taken on pension liabilities. The commodities broker Liberty House, one of the declared bidders for the sprawling Port Talbot plant, has said it would not sponsor the pension scheme.
Greybull, a ‘family office’ investment company, which is close to buying the Scunthorpe-based long products division for £1, set up another, less generous scheme. That deal has carved out around a quarter of Tata’s British revenues and a third of its British workforce.
“John Ralfe, an independent consultant, said: ‘No buyer of the individual Tata Steel plants will take on any pension liabilities, which will remain with Tata Steel UK. Once all the plants are sold or mothballed, there will be no underlying business to support the £15bn British Steel pension scheme and it looks certain to end up in the Pension Protection Fund.’” (Tata Steel’s pension scheme is a ‘noose around its neck’ by Andrew Bounds and Michael Pooler, Financial Times, 14 April)
The trade union response to the mass cull of jobs in the British steel industry has not been to lead occupations of steel plants, or even to organise strikes in protest. Instead, the response has been to berate the government … for failing to fight the trade war with sufficient vigour. TUC chief Frances O’Grady told the press: “Cheap Chinese steel imports are wrecking the UK steel industry. It beggars belief that ministers are blocking attempts to deal with this.” (Government giving China green light to dump steel, TUC, 16 March 2016)
What is wrecking the steel industry is the decades-long failure to invest – a failure predating by many years China’s emergence as a trade rival. The crisis in the industry stems from the overall crisis of overproduction – a crisis that gluts commodity markets with products of all kinds; products that the world needs but cannot afford to buy.
This crisis inevitably sharpens the competition between rival producers, moving in due course from the economic to the military sphere.
Communists prepare to end this crisis by fighting a class war against capitalism, whilst social democrats (the Labour party and its various hangers-on) seek to end it by assisting British imperialism in fighting its trade war corner. Instead of gathering up the threads of resistance into the common cause of overthrowing capitalism and organising production on a socialist plan, social democracy ticks off the British government for its alleged failure to show sufficient enthusiasm for EU plans to ramp up protectionism against non-European steel imports.
Telling workers that the solution to their problems is for British capitalism to stick with the EU, batter the Chinese and win the trade war is the worst political advice. It will not ‘save our steel’, but it will help to tighten the bonds that tie the labour aristocracy to imperialism, as well as preparing the psychological ground for the next bout of warmongering.
In the hopes of saving Tata Steel’s operation in Port Talbot, union reps volunteered to collude with local management in the axing of 750 jobs in exchange for a two year stay of execution and a cash injection of £100m. The logic was familiar and beguiling: better embrace the loss of 750 jobs voluntarily than see all 4,000 jobs go otherwise.
And if the wind had been blowing in the right direction at the board meeting in Mumbai, the ‘turn-around plan’ might just have squeaked through … this time. But even if it had, and most of the jobs had secured a reprieve, how would keeping everyone mesmerised by this ‘partnership’ approach do anything to toughen up workers ideologically for the much bigger struggles that lie ahead as the crisis of overproduction deepens?
Only communist leadership can rise to this challenge.