Ground Zero: The Grangemouth catastrophe, the Unions and the socialist movement

6 November 2013

On the one side, careful planning, cool calculation and utter ruthlessness, on the other bluster, moralism and confusion.  At one level it is not hard to understand the outcome of the Grangemouth dispute or how the UNITE bureaucracy, led by Britain’s leading ‘left’ bureaucrat, Len McCluskey, went from giving notice of strike action, to embracing capitulation “warts and all” to finding themselves in a meeting in a state of unconditional surrender, with the terms dictated worse than they could have imagined.

Pay is pegged for 3 years, bonuses have been cancelled, a final salary pension scheme has been closed, a no-strike deal rammed through and union structures ripped out of the plant. The workers face a sharp fall in their standard of living with no means to strike back. 

UNITE have struck many deals that let down their members and were happy enough to go into negotiation when INEOS laid out a number of these conditions. What has been a body blow to the bureaucracy is that the company removed their role as representatives. The union were locked out with absolute surrender the terms for ending the lockout. To add insult to injury, the final settlement involved dismantling much of the union structure inside the company. What is left will have the role of rubber-stamping management diktats. The resignation of Stephen Deans, one of the two conveners and the subject of an ongoing witch-hunt, is a sign of the union’s defeat.

Complacency

It is true that the UNITE leadership were utterly complacent, totally blindsided by the company and that they flew into a panic when they were locked out. The main substance of this article however is to argue that that does not sufficiently explain the defeat. McCluskey did not become the leader of UNITE because he is a fool or a coward and he was leading one of the most skilled and advanced layers of the working class with a long history of combat behind them. He is not a man to be derailed and humiliated by an empty bluff or to pass over weapons available to him if they could be readily deployed.

What will be argued is that INEOS boss Jim Ratcliffe had objective pressures operating that made the attack necessary, rather than a whim or an act of malice. There were strong weapons in his arsenal that he had carefully considered and deployed and that when he struck, the potential defences crumbled before him. As any general, he then took the opportunity to seize as much ground as possible.

If this is the case, the whole strategy of McCluskey, the Left bureaucracy and, in fact of the British trade union leadership as a whole has been completely overthrown. Not only that, but the different strategies presented by the socialist groups have also been thrown back. Simply to mouth standard slogans, as so many are doing, is not sufficient. We need a real and detailed analysis of the dispute and a regroupment of socialist policy and socialist organisation.

Finance capital

Radcliffe claims that the petrochemical element of the Grangemouth site was losing money. The plant required modernisation and he was prepared to invest £300 million, but the other elements of the business plan required a wage cut, the dumping of the pensions plan and restriction of workers trade union rights so that  the management can have free rein.  UNITE dispute the company’s figures and say that the plant was profitable, but this is simply whistling in the dark. Comparing figures is no help when the fact is that the company’s policy has been based on this plan for many years of careful preparation. It is simply crying out “Do no evil!” and hoping for the best. The issue is how can INEOS be defeated? 

It is of some help to consider the background. Radcliffe is a billionaire, but not because he is really good at petrochemicals. He has made the transition from manufacturing capital to finance capital and has drawn heavily on bondholders who expect a high return on capital. He has also made an alliance with the Chinese petrochemical industry, with a history of superexploitation of Chinese workers and a plan of expansion into Europe. They expect to gain competitive advantage by modernisation – putting in fresh capital and stripping out workers wages and pension rights – exactly what is happening at Grangemouth. 

They have a number of advantages. There is excess capacity in the petrochemical industry and a number of refineries have closed. They have a large reservoir of capital available and the capital is very mobile, making it possible to threaten the closure of Grangemouth and the transfer of investment. The rise of fracking in the US has led to a fall in the price of US oil relative to North Sea oil and part of Radcliffe’s business plan is a fleet of large tankers that would import from the US.

Old fashioned trade unionism

So, on the other hand, what were UNITE’s plans to defeat INEOS? 

The main thing to understand is that UNITE, the "broad left" current that Len McCluskey represents and indeed the union bureaucracy throughout Britain and Ireland, do not have a plan to defend workers rights other than to go along with the austerity in the expectation that capitalism will recover, now and again lobbying for a better way that is kinder and fairer to workers In Britain this strategy is based on a Labour government implementing austerity rather than the coalition. The recent privatisation of Royal Mail without a shot being fired is a classic example of a union bureaucracy in action.

In that context there are two major strategic elements for the bureaucracy. One is to preserve themselves by insisting that they are allowed to represent the workers and that they negotiate the deal, no matter how poor the outcome. The other is to argue for a political current of reformism, a reborn left-wing Labour party, that will win the concessions in government that they fail to secure through industrial struggle.

There are also issues specific to Grangemouth. The bureaucracy like to show that "old fashioned trade unionism" can deliver victories. At Grangemouth you have a 24/7 constant process plant, a highly skilled and unionised workforce and strategic product needed to maintain the economy in Scotland, the North of Ireland and northern England. This has given local advantages to the trade unions and enabled relatively easy victories.   In 2008 such a victory was won.

These were the forces aligned against each other in the battle for Grangemouth. One after one, in rapid succession the union's positions fell.

Reclaim Labour?

The weakest point of the union strategy turned out to be UNITE's political orientation to the Labour party. Len McCluskey was the kingmaker who elected "Red" Ed Miliband as Labour leader, only to have him declare that Labour was a "One Nation" party and not any kind of workers party. A number of UNITE workers, with a number based at Grangemouth, then recruited to the local labour party in Falkirk with the aim of nominating a UNITE candidate. Miliband saw this commonplace activity as conspiracy, launched an enquiry and called in the cops, going on to announce that the party would be breaking its traditional links with the unions.

The Labour witch hunt then transformed into an INEOS witch hunt. On the thin grounds that convenor Stephen Deans had used company emails an investigation was launched and disciplinary action undertaken.

It was at this point that UNITE balloted for strike action and found their complacency shattered by the realization that a weapon can point in any direction. A continuous industrial process can work in the workers interest when the employer is unprepared. When the employer is prepared a lock-out can be devastating. Management initiated a "cold shutdown" in the petrochemical complex that involves weeks to restart and threatened total closure. In a panic, UNITE withdrew the strike call. INEOS, seeing their enemy off-balance and isolated politically, wrote directly to the workforce, offering a bonus for surrendering their rights. Around 50% accepted, showing that a large section of the workforce had no confidence in the union leaderships ability to pursue the struggle.

The one remaining string in the bureaucracies' bow - the strategic importance of the plant to the state - failed also. Britain, in the switch from coal to gas, long ago gave up energy independence. It is a country where financial capital massively outweighs industrial capital and where the current austerity, claimed to rebalance the economy, has in fact tilted the balance further towards finance capital.

It is therefore not surprising that the British government and media, who would have denounced a strike as treason and blackmail, were fully in support of INEOS, that Labour leader Miliband urged UNITE to settle, or that the British government are supporting the conversion of the plant with loan guarantees of £150 million.

Len McCluskey, standing in the ruins of all his carefully constructed strategies, responded with capitulation. He would embrace the INEOS diktat, "warts and all." When he did get to the table the employer, ruthless to the last, stripped the union of its workplace organization, leaving a shell. Even after the defeat the rout continued, with the Conservatives denouncing UNITE for intimidation and Labour politicians calling for a re-opening of the Falkirk election witch-hunt.

The Socialist movement

What of the socialists? Their usual relationship with the bureaucracy is to hear no evil and see no evil, but the Grangemouth debacle led to unprecedented criticism. Did these reveal a mechanism for a more effective fightback?

The more simplistic criticisms were based on the assumption that the Grangemouth management were not serious in their attack. The best response to lock-out would be to call a strike! A broader campaign of public support will do the trick!

Not far behind were proposals to nationalise Grangemouth. The old nationalised industries were nationalised by capitalist governments to ensure security of production and for many workers this ensued standardized conditions better than under individual capitalists. Advancing a call for nationalism today, when capitalism is tearing open the remaining public services and passing resources to the private sector, is sheer nostalgia. There is no mechanism for nationalisation, The Labour Party will clearly not oblige, a more left-wing labour is fantasy and a genuine workers party would simply expropriate the plant.

Another casualty of Grangemouth was the current left enthusiasm for Scots independence and the credibility of the SNP administration. There is a wider theoretical question around the issue of independence for Scotland, but what the lockout showed was that the SNP has no radical edge which would benefit workers, or any alternate mobilisation of workers around the national question that would provide an alternative strategy.

The case put forward by SNP leader Alex Salmond is that an independent Scotland would draw down large oil revenues and that it would use these revenues to run a welfare state that would meet the needs of workers and the poor. Yet, rather than being able to put pressure on the financiers behind INEOS, his administration is to support the restructuring programme and the cuts in worker’s wages with a grant of £11 million.

Another layer in the British socialist movement is cohering around a "left unity" discussion. At the time of writing it has provided little in the way of analysis or discussion of the Grangemouth defeat. In fact most of its narrative is focused inward, around issues such as "safe spaces" for discussion arising from a particular interpretation of feminism or questions around the level of radicalism that should be demonstrated in the founding statement of a new party.

This detachment is characteristic of the majority of the socialist movement. The trade union and labour bureaucracies retain the support of organized workers. The socialists are small and isolated and it is only at the infrequent trade union rallies that they can reach a mass base. This physical dependence has become political dependence, with the socialists failing to put forward a critique of reformism or a programme for workers and instead pursuing private projects and ignoring the reactionary role of the bureaucrats.

Rank and File

By far the most healthy reaction to Grangemouth came from workers inside the UNITE union, from a large and organised rank and file movement led by the long-standing activist Jerry Hicks. They, at least, understand that a revived workers movement involves a struggle to displace the current leadership and build a fighting democratic union. They dismiss with contempt the McCluskey strategy of reclaiming labour and point out that the millions poured into the Labour party are answered with contempt from Miliband.  There is however much more that must be said. The Grassroots formula of only supporting MPs who support the union has to be extended to the call for a new party of the working class. A class struggle movement in one union is a big advance, but it has to become a class struggle movement across the unions. The trade union and political fights have to be united around a movement that is willing to reject the claims of finance capital and to step in and expropriate capital where it is necessary to preserve the livelihood of workers.

So was there a strategy available that would have led to a workers victory? It is clear that the response to lockout should be occupation of the plant. Sympathy action was also required, both throughout the petrochemical industry nationally and across INEOS internationally. The cost-cutting exercise at Grangemouth runs alongside massive price hikes and record profits in energy firms. The Labour party has promised a temporary freeze on prices, so a call could be made for a permanent cap and for a workers enquiry into the firms. In addition the British government have just announced a return to the installation of nuclear energy, outsourced to French manufacture and Chinese capital - a form of private finance initiative that has British workers paying at twice the current rate for 40 years. 

There are many issues around which a fightback can be organised, but they cannot be organized by the current leadership of the working class – for example the absolutely central weapon of the secondary strike has been illegal for decades, despite unions being the main financial backers of a Labour government. The fight to mobilize against the financialisation of energy and petrochemicals will involve absolute opposition to the interests of the banks and the financiers, self-organisation of the workforce, a willingness to mobilise and expropriate capitalist resources; all processes that can only be finalised in the construction of a revolutionary party of the working class.

Grangemouth is not the Miners strike. It did not involve a large section of the working class nor was it a full scale confrontation between capital and labour. It was however a serious defeat, partly based on surprise, opportunism and ruthlessness on one side and complacency on the other. What it has shown up is the utter inability of the traditional leadership to defend workers and the demoralisation and lack of strategic vision on the part of the socialists.

We have had a sharp shock. The task is to learn from the defeat and build a new movement, rather than fall back into apathy and the old way of doing things, the old dependence on left labour and the left bureaucracy.