Social Blitzkrieg in Germany –
the government's and employers' offensive against labour
By Mathieu Denis*
*Canadian Universities Centre, Berlin
Germany has become the outpost of the war on workers, the unemployed and the welfare state. In no other country of Europe and North America is this war being waged on so many fronts at the same time and with such harshness at the moment. In none of these countries do big bosses, their industry welfare ministers, watch dog journalists and parrot intellectuals form such an enraged army; nowhere has the communion between them reached a higher degree. Such a grotesque picture would need a Bertolt Brecht to find an eloquent description.1 The holy cause of their alliance is a new set of reforms of labour legislation, a radical remelting of labour/capital relationships in Germany. Since March 2003, every week brings new attacks and all attempts at synthesis appear obsolete, as soon as formulated. The offensive launched in Germany is trampling down one of the most developed systems of social protection and labour law. Workers everywhere, both employed and unemployed, are threatened. News from the front.
In March 2003, the publication by the Social-democratic (SPD) / Greens government of a global revision program of social and labour laws, the Agenda 2010, roused deep worries within the population. The unionist/worker element of the SPD had been especially active in striving to force “social adjustments” into an Agenda explicitly contrary to the program of the party. It put the chancellor under pressure and forced him to resign as SPD leader and to submit his Agenda for approval by the members in an extraordinary convention held in June 2003. As shrewd a strategist as he can be, chancellor Gerhard Schröder took advantage of the collapse of support for the SPD within the population to force the party's basis to ratify the Agenda, under the threat of his resignation.
So what’s on the Agenda?2 A loosening of the protection against dismissals3; the systematic inclusion of opening-clauses in sectoral collective agreements4; a reform of the public retirement system5 which will probably raise the age of retirement from 65 to 67 as well as reduce and tax pensions; a reform of the health system, “the most significant and necessary component of our internal renewal”, according to the chancellor. A supplementary quarterly fee of 10 euros for visits to the doctor's and a considerable reduction of medication refunds have already been introduced.6 However the overall reform is yet to come: it will aim at privatising services and getting rid of the equal financing by employers and employees, to the advantage of private insurance companies and in contradiction with the promises made during the 2002 federal campaign by the SPD.7
Wolfgang Clement, the social-democratic ‘Super-Minister’ of Economics and Labour, has greeted the Agenda as a “second Bad Godesberg”, referring to the programmatic reorientation of 1959, by which the SPD wooed new voters and redefined itself as a party of ‘all the people’ (Volkspartei), as opposed to a workers' party, its first post-war identity.
Of all the Agenda's reforms, the blending of unemployment insurance and social security aroused particular worries. Known as Hartz IV – the fourth set of laws inspired by the conclusions of the commission chaired by Volkswagen human resources manager Peter Hartz -, this reform was implemented by January 2005. It brought about a drastic drop in the unemployed persons' rights and standard of living in Germany:
-) Duration of 'Unemployment Insurance I' (ALG I) benefits cut in half, to a maximum of 12 months for workers under 55, and to a maximum of 18 months for workers over 55.
-) Blending of the 'Unemployment Insurance II' system (ALG II, after more than a year of unemployment) and Social Security. The ability to work of social welfare recipients is re-evaluated. Those labelled as “capable of working” (arbeitsfähig) are now considered “long-term unemployed” and brought back onto the labour market.8 The ALG II benefits were cut down, to 345 euros monthly in the Länder of the West and 331 euros in the Länder of the East.9 If a long-term unemployed person has assets of more than 200 euros per living year, she is not entitled to allowances.10 If she owns a life insurance or an automobile in “disproportion to her needs”, she might be forced to cash these prior to receiving any allowance.
-) End of the rent reimbursement by municipalities for persons receiving ALG II benefits. Instead, municipalities shell out a lump sum rent allowance, ranging from 50 euros (in Dresden for instance) and the maximum of 180 euros. A complementary allowance for water and heating costs is possible in some cases.11 The exemptions for the television and radio tax, and the Deutsche Telekom's so-called ‘social tariff’ are repealed.
-) Implementation of a set of penalization measures for ALG II benefits recipients. If an unemployed worker put off registering to the Federal Employment Service (Bundesagentur für Arbeit, BfA) or if she doesn’t show up at a prescribed medical appointment, her ALG II is reduced by 10% for three months. If she refuses a job offer (even of short duration), fails to appear at a training session, is not dressed properly for a job interview, has “economically inadequate” behaviours (unwirtschaftlich), lies about her incomes or holdings, her ALG II benefits are cut by 30% for three months. These penalization measures add up. Other reprisals are foreseen for recidivists – but not only. At the first offence, an unemployed worker between 15 and 24 is entirely deprived of ALG II benefits for three months (rent and service charges are taken care of and she receives coupons for food). At the fourth offence, an adult unemployed worker can also be left without ALG II benefits for three months, without any right to further aids. In parallel, the federal government has recently raised the cost of a recourse to the social and labour tribunals.
-) Drastic reduction of the additional income an unemployed worker is entitled to earn. Prior to the Hartz reforms, an unemployed worker was entitled to earn 165 euros monthly without penalization. Now she receives 15% of the first 400 euros (60 euros) and 30% of the exceeding amount. Hence, in order to see the colour of the 165 euros previously allowed, unemployed workers now have to earn 750 euros.
-) Sentence to hard labour for persons receiving ALG II. Long-term unemployed workers are forced to “remain at the disposition of the labour market” and to accept any job12, underpaid temporary job or non-remunerated vocational training offer, even without any link to previous training or experience (only physical incapacity, health problems or minding of a child younger than 3 years of age justifies refusing a temporary job or vocational training without penalty). Hartz IV doesn’t fix a maximal distance from the home (meanwhile the cost of a monthly public transport pass is no longer covered for the unemployed workers), no more than it specifies under which conditions and for what pay the job has to be done. This is decided by management; collective agreement standards do not have to be observed. Rumour has it that employers hiring long-term unemployed workers are paying them up to 30% below collective agreement settlements. If the unemployed worker refuses, the penalization measures apply. This forced temporary work relation must be confirmed by a contract between the unemployed worker and the employer. No contract means job refusal and penalty. The unemployed worker is thus forced to ratify a work contract over which she can hardly exert any influence.
-) Specific worsening of the situation of families. The grants for children from 7 to 17 have been cut to about 150 euros monthly for each of the first two children. Former allowances for needs resulting from child growth (clothing, shoes) have been replaced by a fairly small monthly lump sum; allowances for school needs have been suppressed (with one exception: school excursions). From the age of 15, any income earned by a child from an ALG II family gets is made to volatilise with the help of the magic formula mentioned above (diminution rates of 70% to 85%!).13
The goals of Hartz IV are obvious: raise the pressure on the labour market, compel unemployed workers to accept any job in any conditions and introduce underpaid labour zones in Germany.
As a prerequisite to the benefits, Hartz IV introduced a 17-page form to be filled in by the unemployed. Not only is this form written in the incomprehensible bureaucratic Prussian language,14 but according to many the scope of the information it compiles contravenes to the protection of privacy laws and the constitution: pay slips; inventory of holdings, including savings accounts for children, who are entitled to only 750 euros; health condition; financial situation of the partner and/or the co-tenant, who might be made to support the unemployed worker. This form helps Federal Employment Service agents (or private intermediaries with whom the Service has an agreement, and to whom it grants access to this confidential information) to make decisions regarding the living conditions of the unemployed workers they are to bring back to work. The agent or his intermediary decides whether the unemployed person has to sell her car, life insurance or house, cash pension funds, empty children's savings accounts, move to a smaller apartment (45m² is usually regarded as appropriate for a person alone, but in Mannheim, it's 30m²).15
One month after Hartz IV’s implementation, unemployed associations contradicted the first self-satisfied run-downs by the government. According to their auditing, many unemployed persons had not received any allowance at all by the end of the month. Furthermore, about 90% of personal forms contained mistakes which resulted in the unemployed worker receiving even less than entitled to.16
Wolfgang Clement, the ‘Super-Minister’, is never short of super ideas. Together with the introduction of Hartz IV, public and social service providers, as well as charitable organizations and churches, were granted the possibility of employing ALG II receivers, for a period of 6 to 9 months for a salary of 1 euro/hour.17 Cleaning parks and streets, fulfilling certain tasks in institutions for the handicapped and the aged, working in child care centres or schools: these are the “jobs useful to society” that long-term unemployed workers are now forced to do for a salary that hardly covers daily food and transportation costs. Voices were soon heard asking for the right to make use of those unemployed workers that excel in their duty for longer periods - under the same conditions. These forced workers are paid beneath collective agreement tariffs, which do not apply to them, and they are not represented by the works councils. They are subject to the will of their employer, with little possibility to counter prejudices against them, for fear of an “economically inadequate” act, dismissal and penalization.
The military and civil service is being abrogated in Germany. The so-called Zivis are thus replaced by unemployed forced workers. All in all, the number of positions in hospitals and public institutions that could be taken on by 1-euro-workers is estimated at a maximum of 60,000. Clement even evoked, perhaps somewhat enthusiastically, 600,000 1-euro-jobs: their social function thus goes well beyond the replacement of the Zivis.
As a matter of fact, regular positions in schools and kindergartens were quickly replaced by one-euro jobs.18 Associations and staff of these institutions have underlined the threat that children and aged persons be more and more taken care of by unqualified personnel. At times, though, it is difficult to figure out what some people think. On the one hand, the president of the federation of the voluntary welfare organizations (Bundesarbeitsgemeinschaft der Freien Wohlfahrtspflege), glad to find forced labour at such a good price, states that “all parents are qualified to take care of children even without any pedagogical education”; on the other, he insists on the right of welfare organizations to select the unemployed workers all the same, underlining the fact that many well-trained educators are unemployed. “It is important that the candidate has the required skills.” Municipalities have also heralded their need for 1-euro-forced workers as well as their conditions, a 42,5-hour-workweek, for instance.19
We are witnessing the creation of a vast area of underpaid and underprotected workfare in Germany, a free zone of cheap-labour for the public sector. The government’s promise that no 1-euro-job would replace a permanent occupation has proved empty: it is giving the axe to dismissal protection in parallel. The German state is setting up an army of underpaid supernumeraries to cover its own needs. Those within the private sector living from contracts with public institutions (for renovation, painting, maintenance, etc.) are immediately threatened, leading to dismissals and downward pressure on wages.20 The former Christian-democratic Labour Minister, Norbert Blüm, recently expressed his concern about the disappearance of consensus-oriented employers and the drop in the quality of life in Germany.21 This trend has been induced by the policy of the social-democratic/Greens government.
If the right to use 1-euro-unemployed workers tempered the opposition of churches and charitable associations against Hartz IV, the population took to the streets. 100,000 people gathered in Berlin in November 2003 and more than 500,000 in three cities in April 2004 in opposition to Hartz IV. More crucial were the organization of weekly demonstrations in many cities, from July 2004 on.
Spontaneous coordinations of unemployed workers organized 'Monday Demonstrations' in Magdeburg and Leipzig. Reappropriating not only the form but also the slogan (”we are the people”) of the movement that, exactly 15 years before, had brought the German Democratic Republic down, the number of gatherings and demonstrators raised swiftly: 200,000 in 140 cities on August 23, more in 220 cities on September 7. Demonstrations continued until the gathering in Berlin on October 2 (200,000 participants), and shrank afterwards though they went on, in small numbers, until spring 2005. As in 1989, demonstrations in some cities were held on other days of the week and it was hard to keep count of gatherings and demonstrators. The movement caught politicians and journalists off their guard. Its primary force lay in the burgeoning of small and medium sized demonstrations, all resulting from local initiatives. Since no party, trade union or association was behind them, people and activists of all kinds marched jumbled up together, with hand-made placards articulating a great variety of concerns. “No to Hartz IV!” and “Schröder, resign!” represented the core-claims, but the voiced discontent obviously reached deeper: over the reforms of the government, political parties, unfulfilled promises of the 1990 unification, insufficient redistribution of wealth, extreme-right. A great deal of unionists and militants, especially from western Germany, were surprised by the popular, family atmosphere of the demonstrations.
Two reasons explain why the anti-Hartz IV demonstrations remained more or less circumscribed to the eastern Länder. The first has to do with the particularly dramatic social and economic situation going on in these regions. The unemployment figures, even official, are alarming: compared to the 8,5% in the West, they reach 18,5% in the East (for a federal rate of 10,5%). Of the 29 cities with an unemployment rate of over 15%, 28 are in the eastern regions. It is a well-known fact that the sudden opening of the East German economy to international competition, decided by the West German government at the beginning of 1990, brought about a swift deindustrialization in these regions. The unification of working and living conditions was not achieved in post-1990 Germany and, until the undergoing wave working-time increases without compensation in the West, people still worked longer and for a lower pay in the new Länder. The second reason has to do with the ambivalence of the trade unions, within which support of the social-democratic government wins over the timorous criticism, resulting in internal tensions.
Forced to deal with the wave of discontent within the population, the leading lights of the SPD came up with some sharp analyses. “I could get along with 345 euros a month”, stated Klaus Brandner, spokesperson of the SPD's parliamentary group on economy and labour market policy and First representative of the metal trade union (IG Metall) in Gütersloh – although he made no attempt to prove it and holds on to his two positions.22 For the president of the Bundestag and former East German opposition activist Wolfgang Thierse, “East Germans should stop complaining”. There is “a receiving mentality” in Germany and people prefer to be given allowances than to work, added the chancellor. Demonstrators did not understand that Hartz IV offers improved social protection, is designed to ensure the future of the welfare state and will give a boost to job creation in Germany, complained Wolfgang Clement. This confusion, he concluded, was the result of a communication problem between the government and the population, a theme that kept some journalists busy for a while.23
In August, the SPD announced a new reduction of taxes on companies' profits. And when the Bild Zeitung published the salaries of the best-paid bosses in Germany, the chancellor himself took offence at such “populism”.24
Inverting the communications deficit theory, one likely hypothesis is that it is because the government has been so successful in putting its agenda across that resistance has been so massive. Even journalists had to recognize that fact when, discussing with demonstrators, they found themselves confronted with the reverent superficiality of their own knowledge of Hartz IV and retreated behind what appeared to their eyes as the final contention “admit at least that we need reforms!”
Another explanation attempt for the anti-Hartz movement, formulated by the government and the media, was that it was rooted in a lack of good will and/or the result of extremist manipulation. Journalists were prompt to find within the public administrations former East German opposition activists who were horrified by this “exploitation” of the strategies and slogans of 1989. Joachim Gauck, for instance, who was the first head of the archives of the East German Ministry for State Security after 1989, raised his voice, though without being quite sure what he wanted to say. The right to demonstrate is “immutable in a democracy”, he stated. Organising anti-Hartz IV demonstrations on Mondays, however, sums up to “an instrumentalization of the movement of 1989”: “At that time, it was about freedom, today it’s about social issues”.25 However, declarations from the pastor of the Leipzig's Paulskirche, starting point of the 1989 demonstrations,26 as well as from former opposition activists favourable to the anti-Hartz IV movement convinced the now high-ranked civil servants - to keep a lower profile, that is.27
The logic behind the extremist-based theory is as follows: if the proof of democracy lies in the unanimity around Hartz IV in the political arena, the protest must have somehow been orchestrated either by the neo-nazis of the NPD or the neo-Stalinists of the PDS. The participation of NPD activists (the only party opposed to Hartz IV) to demonstrations was blown out of proportion. Beside relative NPD breakthroughs in two regional elections, recent electoral trends are the increasing abstention rates (more than 40% for instance in the traditionally industrial region of the Saarland) as well as the confirmed collapse of support to the SPD.
The role of the former East German state-party PDS in the movement against Hartz IV was more significant. The PDS has a real political weight in eastern Germany. Its activists took part in the anti-Hartz campaign from the beginning. Slogans denouncing the consensus among the political class in favour of Hartz IV sometimes spared the PDS, though the party actually had backed the Hartz report when it was first published. The PDS wavered between opposing Hartz IV and holding out a hand to the SPD, in the hope of opening the door to more governmental coalitions. The party leader, Lothar Bisky, declared: “I never said that all Hartz IV was bad”, turning his back on the popular movement which aimed at its abrogation. Questioned over the elements of Hartz IV that he appreciates in particular, Bisky mentioned among other things “the pressure [that] we have to be able to exert on unemployed workers that don’t want to work”, but specified that “they are a minority.”28
On August 30, 2004, the former SPD Finance minister forced to resign from the Schröder government in 1999 for Keynesian deviationism, Oskar Lafontaine, addressed the demonstrators in Leipzig. For many months now Lafontaine has been attempting a comeback in politics. Still appreciated among SPD members, Lafontaine capitalises on the worries of party officials over members fleeing by the thousands every month, the party's deficit and the support among the population which peaks at about 25%.29 A return of Lafontaine at SPD's head could bring back a few thousands members in the party. It would be a revenge by the moral-Keynesian wing of the party – and would mark the failure of its ‘official’ left wing which has dedicated itself to “better explaining Hartz IV to the population”, in return for the chair of the commission examining a rather hypothetical Citizen’s Insurance program (Bürgerversicherung).
Less covered by the media is the creation of the Alternative for Work and Social Equity (Wahlalternative für Arbeit und soziale Gerechtigkeit, WASG), which officially became a party in April 2005. It counts about 4,000 members. Its initiators are for the best part unionists, long-time SPD members who left the party after it had abandoned them, and activists from ATTAC Deutschland and other social movements. The WASG platform rearticulates principles of wealth redistribution, a demand-oriented economic policy, a wide-ranging welfare state, working-time reduction, anti-discrimination policies and calls for the improvement of labour law, all of these fields left vacant by the SPD.30 It is both an answer of the party's basis to six years of Schröder governance and a legitimate child of popular protest. It is still too soon to predict the kind of echo the WASG will find within the population and whether or not it will take root. It is likely that some of its initiators hope to be able to go back to the SPD at some point. As was the case in the 1917 split of German social-democracy with the creation of the independent USPD, the future of the WASG relies on the evolution of the social situation in the country.
This brings us back to the unions. As said, the fact that workers in the West were more responsive to the unions’ arguments for not confronting the SPD explains that the anti-Hartz movement was less successful in these regions. The heads of the biggest trade unions had to voice at least some criticism. “Hartz IV is the less social component of the antisocial Agenda 2010”, stated the head of ver.di, the giant trade union for the sector of services, plagiarizing a Financial Times’ columnist and pretending to forget his own backing of the Agenda 2010 and Hartz I-IV.31 Verba volant, gesta manent: unions have paid only lip service to the initiatives of Monday demonstrations in the West. These remained much stronger in eastern Germany and Hartz IV took on the misleading character of a regional problem.
More than anything else, union heads waited for the right moment to declare the struggle lost. After a few new commas had been added, making Hartz IV clear to him at last, the president of the Federation of German Trade Unions (Deutscher Gewerkschaftsbund, DGB), Michael Sommer, thought himself legitimated to proclaim the end of the protest, at the beginning of September 2004. The demonstrations went on. At the end of September, the media announced that the total number of demonstrators had shrunk, an evolution they were quick to analyze as a new support to the government – whose reforms were rejected at around 70% according to all surveys -, a result of its firmness, which the population was said to admire. The DGB and ATTAC Deutschland (Association for the Taxation of financial Transactions for the Aid of Citizens) pretended they had drawn the unavoidable consequences and declared that they no longer called to demonstrate – something they had only done through their teeth in the first place. The DGB took the opportunity to state its support to 1-euro-forced labour, as long as these jobs “do not replace permanent positions”, of course.
Of all evils, it was the demonstrations’ slogans that union leaders seemed to dread the most. In the name of the trade union movement, the DGB declared: “The trade unions will energetically oppose demagogues of all political tendencies. This especially applies to undifferentiated calls to the rejection of Hartz IV.”32 A statement by its leadership a few days later was more specific about the fear that a clear-cut opposition to the SPD might help the CDU, also favourable to Hartz IV. “We all share the opinion that it is out of question to support slogans as ‘No to Hartz IV!’ and ‘Schröder, resign!’, because: what shall come afterwards?”33
Such reluctance to confront the SPD displays not only the bonds between the unions and SPD, still significant today.34 Fundamentally, it is the symptom of the weakness of the trade unions in Germany at the moment. If at all, the attempts to smoothen the destruction of social gains and rights of workers are made behind closed doors in smoke-filled rooms, obviously without much success – not to mention union officials favourable to the reforms. Until the anti-Hartz IV movement, trade unions had remained the first sensor of social tensions in the country.35 Their unmistakable outflanking in recent social upheavals is grounded on their incapacity to counter the parallel dismantling of the welfare state and labour laws led by a social-democratic government, as well as the combined threat of delocalization and massive layoffs.36 The two biggest German trade unions, for the metallurgy (IG Metall) and for the public and service sectors (ver.di), sign anything and everything, in a headlong flight to safeguard their power to keep on signing. It is the trade unions' power of representation which is at stake.
During the summer of 2004, employers opened a new front against workers, aiming at increasing working time without compensation. Its forerunner was the defeat of the 2003 strike for the implementation of the 35-hour week in the eastern metal industry. Had it been won by the workers, they would be on their way to reaching by 2009 the salaries and working conditions which apply within that industry in western Germany. After four weeks, the strike had been unilaterally torpedoed by the former IG Metall president, Klaus Zwickel, and some works councils’ presidents. Buying the discourse of employers and government, the union’s head argued that the East German 38-hour week paid 35 West German hours represented the only job guarantee for eastern metal workers. Without consulting their constituencies, the presidents of the enterprise works councils of Opel, Daimler-Chrysler and Porsche also condemned their East German colleagues’ struggle.37 The union soon split along an East-West axis and faced a dramatic crisis (according to rumours, IG Metall lost about 10,000 members monthly for more than a year). Its program, based on the idea that the reduction of working time creates jobs, and its action in the East and in the West had been blatantly ravaged. In the East, by giving up the goal of levelling working and pay conditions to western standards, the sole objective of the union’s activity in those regions since 1990. In the West, because since the successful 1984 strike, IG Metall had moderated its claims over a period of fifteen years, in order to secure the final implementation of the 35-hour work week in 1999. The failure to implement it in eastern Germany meant workers were back to square one. Downward bench-marks in both parts reinforce the undergoing decline of the population’s standard of living.
The employers’ working time offensive was launched in the western metal industry. In the Summer of 2004, Siemens easily obtained a special agreement for two West German cellular phone plants introducing the work week of 40 hours paid 35 (increase in working time without compensation) and the abolition of all bonuses, under the threat of delocalization and massive dismissals. The general agreement for the Siemens group, negotiated a few months later, introduced an increase in working time without compensation, from 35 to 37 hours and the transformation of the Christmas and holiday bonuses into a performance-related bonus for 8,000 production workers. As a counterpart, Siemens preserved all jobs and brought 12,000 joint-venture workers back into the group.38 In its negotiations with Volkswagen, IG Metall swallowed a 28-month wage freeze and a far-reaching remelting of remuneration schemes, against a job guarantee until 2011. Through different paths, the new grids agreed on will attain the objective of cutting current wage bills by approximately 20% within a few years.39
The employers' demand for an uncompensated increase in working time spread like wildfire. Daimler Chrysler, Opel, Lufthansa, Porsche, BMW, the Deutsche Bahn, Thomas Cook, retailers like Karstadt and Ikea, BASF, public administrations and ministries, hospitals: the giants of each sector clear the path for smaller companies, more vulnerable to the assaults of international competition. Economic institutes provided their expertise: only uncompensated increases in working time can create jobs in Germany.40 And to nip any indignation in the bud, they even suggested the idea that a 50-hour workweek would probably be even better.41
The repercussions elsewhere of working time increases and wage cuts in German enterprises are visible, starting in the neighbouring countries. During the recent election campaign in Denmark, many politicians and unionists complained about thousands of job losses due to delocalizations in Germany. Meatpackers in Germany, for instance, are paid three times less than their Danish colleagues.42 If the normal wage is about 8 euros an hour, thousands of recently hired Polish meatpackers in German slaughterhouses earn 2,50 euros an hour.43 In 2004 Bosch increased working time in some of its French plants without pay compensation. The French government has modified the law on the 35-hour-workweek. Comparable proposals are being discussed in Austria and Belgium.44
This exceptional state of social dynamics, the government’s and employers’ attacks against workers, the impotence of trade unions and the popular discontent, expressed itself in all its complexity on October 14, 2004. On that day, the service sector union ver.di and the retail giant Karstadt-Quelle made public an agreement that foresees the dismissal of 5,500 workers, an increase of working time without compensation as well as a three-year wage freeze (which will allow the group to save 760 million euros). Given the economic difficulties of the group, the union claimed, the agreement was a success for the workers.45 Chancellor Schröder greeted it as “exemplary” and, in fact, its bench-marking effect was obvious: on the same day, other retailers stated their desire to come to comparable agreements with their employees. It was on October 14 as well that General Motors announced 12,000 layoffs in its European Opel plants, the bulk of which - 10,000 - in Germany. The plants in Bochum and Rüsselsheim were especially targeted, with about 4,000 layoffs each. By sacking one third of the Opel workforce in German plants, GM aimed at reducing its wages bill by 500 million euros. In Bochum, this announcement was immediately followed by a walk-out, a wildcat strike that lasted six days. There is no reason to believe that the anger was any weaker in Rüsselsheim, but the works council there was able to prevent any radical action of protest, invoking the direct threat of the Swedish plant of Trollhättan for the 20,000 jobs there (for a total population of 60,000).46
The strike at Opel Bochum was a spontaneous reaction but it had a prehistory. The Hartz IV reforms, the recent setbacks at Siemens and Daimler Chrysler formed its background, as the slogans made obvious (“Entweder streiken wir – oder Hartz IV!”: Either we go on strike or on Hartz IV!). Within a decade the workforce in the Bochum plant had been cut from 19,200 (1992) to a mere 9,700. As shorter wildcat strikes in 1993 and in 2000 had shown, work stoppages in Bochum quickly force the chains to stop in many other European plants, because of their dependency on the press components and axles produced there. Whether and how the existence of a group of militant workers expelled from IG Metall about 30 years ago but still active and challenging the works council practices in the plant might be accountable for such actions is difficult to assess. For sure, members of the ‘Resistance without limits’ (Gegenwehr ohne Grenzen) had had nothing to do with the immediate launching of the strike.
Caught unawares by the workers’ wrath, works councillors and IG Metall heads echoed the voices of employers, government and journalists, as they called for a swift return to work. “Otherwise, complained IG Metall vice-president Berthold Huber, we cannot negotiate effectively (zielführend) with General Motors”.47 Bochum workers’ claims were answers to the assault: no dismissal without a negotiated social plan, no outsourcing, preservation of pay and working time schemes, upholding of the Opel European framework agreement. Although they aimed at insuring the same working conditions in all of Opel's European plants, as captured in the watchword “one enterprise, one workforce”, the Bochum strike was not followed by consequential actions in any other European Opel plant. The IG Metall refused the Bochum strikers food, material or technical supply, thus setting a quarantine line around them in order to prevent any propagation. The day of action in European Opel plants against GM’s plans on October 19, took place while chains in Belgium and Holland had stopped for lack of parts coming from Bochum. But union and works council leaders, who were in every German Opel plant except that in Bochum, concentrated their attacks on “unsocial, American managerial ways”, another variation of their incapacity to counter the undergoing offensive against workers’ rights and entitlements in Germany, be it led by entrepreneurs from any country. They called again for the end of the strike in Bochum. There, the day was marked by a demonstration by 25,000 people, mainly Bochum citizens. The local population showed strong support for the strikers: money and food were collected, people and even school classes spent time on the picket lines. Estimations are that 1,300 layoffs at Opel could result in a loss of about 68 million euros for the region.48
The strike took the form of a long and open discussion called “information session” in which all workers were invited to share information and proposals, with one restriction: the ban on ‘political propaganda’, from any party or group. The strikers did not elect spokespersons, a symptomatic behaviour that journalists failed to see, as they kept interviewing specific strikers, qualifying them as such.
The return to work was voted in a muzzled general assembly organised by the Bochum plant works council, held on October 20. During a short twenty minutes two plant works councillors and one union official, protected by hired goons, pleaded for the end of the strike. The absence of microphones in the audience prevented the 6,400 participants to debate prior to voting. Though workers had apparently decided to return to work, the absence of a plenary session was seen by many as a provocation, especially given the formulation of the question.49 The president and vice-president of the plant works council admitted that the question finally put for workers’ approval was not the one they had convened upon, and resigned a few days later.50 Where had the controversial question originated from? From Opel's enterprise works council and top floor IG Metall offices seems a reasonable guess. The question read as follows: ‘Shall the enterprise works council continue to negotiate with the management and work be resumed?’ Although the strike had been thought as a means to exert pressure on the management during negotiations, the question made it impossible to defend this position. 4,600 workers voted in favour of going back to work, 1700 against it. The press greeted a “clever” and “rational” decision which prevented any further rift between workers and their organizations.51
The rift is the result of the current incapacity of the usual structures of interest representation. On December 8, a first agreement with Opel's management was finally ratified by the enterprise works council, 21 votes against 16. The agreement foresees the elimination of 9,500 jobs in German Opel plants, 2,900 of which in Bochum. Out of that number, 6,500 have to leave voluntarily and about 1,800 are given early retirement. The outsourcing of an additional 1,200 in a joint venture removes the production of axles from Bochum and from workers’ control there. The enterprise works council submitted the agreement to workers’ vote without presenting it in a general assembly as usual, under the pretext that it was an “optional offer” that everyone was free to accept or reject. The truth is that there was nothing optional or free: 6,500 workers had to leave voluntarily by February 2005 – or Opel threatened with dismissals without negotiated social plan.52 Opel's management had not withdrawn from its initial demands and it was hard to share the enterprise works council’s relief and opinion that the worst had been avoided.53
In order to break 6,500 labour contracts, Opel has recourse to Employment and Vocational Training Companies (Beschäftigungs- und Qualifizierungsgesellschaften, BQG), structures usually meant to train workers and preserve a good share of their pay for a certain period of time, while their company faces an immediate threat. If these workers cannot take back their former position, the BQG tries to find them a new job, which they succeed to do in about 12% of cases.54 Hence where the BQGs are supposed to preserve employment, they are here used to bypass labour laws, with the union’s and works council’s blessing. After their year within a BQG, the bulk of Opel workers are very likely to fall under the Hartz IV provisions. To convince them to leave, Opel offered keen workers termination bonuses of an average of 100,000 euros and promised them 85% of their last annual income during their year within the BQG. Opel satisfied itself with the 6,000 workers who showed interest in the offer.55 The enterprise works council saw the agreement as a success because of the large sums Opel agreed to pay. But these claims call for nuance: apart from termination bonuses, Opel pays only 40% of 85% of the last income for these workers (or four months of salary). The rest, 60% of the 85%, is paid by the Federal Employment Service, thanks to Super-Clement’s intervention. But this unexpected new role given to the Federal Employment Service raises more questions than it gives answers: the nature of the relationship between the BQG workers and the Service, and the conditions to which Opel have to comply to be paid 60% of their salary, remain unclear.56
On March 4, 2005, a final agreement on wage and working conditions was published. Against contracts provisions (the Astra for Bochum and the Saab 9-3 for Rüsselsheim), Opel managed to obtain a wage freeze until at least 2007 and the substitution of the flat 35-hour work week into a 30-to-40-hour ‘corridor’, without overtime bonuses and including work on Saturdays.57
This kind of rollback agreement was ratified for the public sector by the trade union ver.di. For almost two years, union and state officials had been working out a thorough reform, the “century reform”, of the general collective agreement, whose 17,000 supplementary classification grids (Eingruppierungsmerkmale) since 1961 had rendered quite puzzling. Arguably, some spring-cleaning was required, but the result turned out to be a major setback for the employees of the public sector. Ver.di had shown its willingness to major concessions before the round of negotiations had opened: relinquishment of life-long job security; working time increases; replacement of family and age bonuses with performance-induced bonuses or penalties of ± 4%. The reduction by 300 euros a month for the lowest pay category (to 1286 euros in the West and 1189,55 in the East), dominated by women, was depicted by union president Frank Bsirske as the only way to stop the fall of wages. This enigmatic logic - bolstering the deterioration of working and living conditions of public sector employees in order to ward it off - also brought Bsirske to accept a general opening clause for the hospital sector to prevent the erosion of the collective agreement, and in models of employees share ownership in the same sector to avoid the privatisation of services. In the same spirit, ver.di had refrained from abrogating the previous collective agreement, as is normally the case before the beginning of collective bargaining. The union had thus no legal right to undertake any industrial action to exert pressure on the state representatives at any moment. In addition, ver.di refused to come to the table with specific wage claims, arguing that the costs of the “century reform” had to be compensated for by salary restraint.58 In a nutshell, ver.di’s strategy is to duck while the storm blows, to clear the path for the public employer’s demands, in the hope of safeguarding its function as negotiating party in collective agreements.
The official bargaining process launched in December 2004 ended after a two-day bargaining marathon headed by Interior minister Otto Schilly and Frank Bsirske on February 9, 2005. The agreement foresees a wage freeze until 2007 but with yearly 300-euro-bonuses, hence resulting in a salary decrease of about 3%. Working time is levelled at 39 working hours (i.e. an unpenalized one-hour diminution in the East, a one-hour unpaid increase in the West), with an opening clause allowing for an uncompensated 40th work hour in municipalities. But the rot has set in the “most-favoured clause” included in the agreement, which automatically extends to all three levels of public administration the most convenient standard ratified by ver.di – convenient to the public employer, that is. It is thus only a matter of time until the uncompensated 40-hour work week is officially back in all of Germany’s public administrations. The Bavarian government set the agenda as it heralded its will for an uncompensated 42-hour work week in the Land’s administrations. The final redesigning of the remuneration grids is not yet completed, but the discrepancy between the first and the last categories has already widened from 1:3,18 to 1:3,91. It is likely that the “most-favoured clause” will accentuate this gap in the near future.59
Ver.di’s head greeted the agreement as a win-win settlement, a verdict that was by no mean unanimous within the union. The union's strategy has been criticized at the basis, if not widely (from what one can tell by reading the union’s press), at least enough to bring some district and Länder organizations to challenge it. After the signature of an agreement which “showed the weakness of the union and nothing else”, some of these critical officials called for a wide discussion in order to clarify their ideas and perspectives.60 After all, every decision of ver.di’s collective bargaining commission, on which the recalcitrant Länder and district organizations have representatives, had been unanimously ratified at all steps of the negotiations.
The second Report on poverty and wealth in Germany, published in February 2005, highlights unmistakeable trends in the standards of living and wealth distribution since the coming to power of the SPD/Greens government in 1998.61 By 2003 the poverty rate reached 13,5% (or 8 million people), after having remained stable at 12% between 1998 and 2000.62 Especially hit are women (two-thirds of the working poor are women), the unemployed (poverty rate of 56,3%), single-parent families (35,4%) and migrants (24%). 7,2% (1,1 million) of children in Germany live from social welfare allowances, twice the average of the population.63 The number of households running up excessive debt grew from 2,77 million in 1999 to 3,13 million three years later (to 8,1% of the total, 11,3% in the eastern Länder). As poverty and the number of poor increased, the overall wealth grew by 17%. Hence the economic disparity has dramatically increased between 1998 and 2003: the richest tenth of German households enjoy 46,8% of the wealth (+2,4%, its strongest growth in decades) and the richest fifth, 67,5% (+ 1,4%), while the second half possess 3,8 % and the last third has no statistic share of it at all.64 For months the Federal Ministry of Health and Social Security delayed the publication of the report and tested various manipulations in order to “powder the nose” of its results (die Zahlen aufzuhübschen), as the minister put it.65
The developments discussed in this article, posterior to the period covered by the report, are all intensifying these trends. They sum up to an overall offensive against the working population. Wealth is being drained from bottom to top: spheres of state intervention for all periods of a person's life are being privatized, working time increases without compensation, wage freezes, new remuneration grids are lowering wages, underpaid work is increasing, yearly bonuses are being replaced by smaller, performance-induced bonuses, when they are not abolished, the compulsory character of collective agreements is melting away. The dismantling of workers' rights and social protection is another component of this offensive.
Since the beginning of 2005 Germany, records over 5 million unemployed workers, for the first time since the late 1920s. The government is putting forth a repressive policy which is handing over the population to employers: labour struggles are made more difficult, the unemployed are forced to accept any job under any conditions. The state's and employers' offensive reduces the population to their strict function as (potential) sellers of labour-power and, in that sense, is inducing a certain proletarianization. This phenomenon can also account for the undergoing decline of working and living conditions in Germany. Consumption has decreased by about 3% in the first quarter of 2005. Although a decline in safety and health at work has been recorded,66 workers are off sick less than ever, arguably a patent sign of the pressure put on them.67
The conviction among union leaders, officials and members that this offensive could only be worse if it were led by another party than the SPD have brought them to put their head in the sand in the hope of safeguarding their power of representation. Until 2003 the opposition to the Schröder government had come from organized labour, within the SPD and the trade unions. When his opponents threatened to throw Schröder out of his office in 2003, many union officials and works councillors became more active than before in preventing any frontal opposition to the government's course. It was the precariousness for the government support within the working population that seems to have swept unions out of the way of the governmental reforms. Schröder's weakness has become his greatest strength.
So far, the opponents of this anti-labour offensive within the trade unions68 or from deceived social-democrats – be it the people around Oskar Lafontaine or in the new WASG – were not able to distance themselves from their (former) organizations' course in a way that could give them a distinct profile and allow for a certain influence over the social evolution in the country. The predominance given to discussions of orientation within these circles, which seldom go beyond praise for former Keynesian re-distributive policies and call for “more imagination” on the part politicians and unionists, is a symptom of the difficulties of the social movement in Germany, but it also shows the strong dependency of these groups on their immediate origins. It seems unlikely that action programs will emerge within these circles and give perspectives to the social movement. The opposite seems likelier: the further evolution of the social movement will help to determine the positions and orientations of activists. The wave of demonstrations against Hartz IV and the wildcat strike at Bochum – both locally-based and organized against political parties and trade unions – were attempts by the working population at overcoming the obstacles to the resistance against the social blitzkrieg launched against them. As far as their goals are concerned, neither were successful. They are, however, determining experiences which the protest is now building on.
1 A recent production of Gerhart Hauptmann’s The Weavers in Dresden took on the 1920s political theatre’s practice to adapt classics as a means of political intervention. The statements and violent insults against the government and journalists slipped into the original text outraged the elites of the country. The Saxon government has first unsuccessfully attempted to put a ban on the production, arguing that “artistic freedom has its limits”. The legal proceedings by star journalist Sabine Christiansen, especially targeted, were also rejected by the court. The publisher house, however, convinced the tribunal that the different additions betrayed the original text and had to be taken out. After the judgement the Dresden State Theatre decided to stop the production altogether.
2 Blätter für deutsche und international Politik, 5/03.
3 Chancellor Schröder stated that such “rigid criteria” as age and seniority should no longer protect workers against dismissal. He wishes to reform the law in a way that “enables employers to hang on to productive elements (Leistungsträger) within the enterprise also in periods of economic difficulty.”
4 Opening clauses have proliferated over the last twenty years, though they remained within bounds. The Agenda 2010’s objective is to abolish the compulsory character of sectoral collective agreements. They would rather establish points of reference for bargaining at the enterprise level. The chancellor has asked the trade unions not to hinder his plans, otherwise “the legislator will act”. Contradicting the chancellor, the German Institute for Economy (DIW), favourable to a general opening clause, sees at it as a weapon of massive job destruction, approximately 100,000 in the years following its introduction.
5 This follows the 2001 reform which had eliminated the equal funding of the public retirement system and introduced complementary private insurance programs, funded exclusively by workers. In 2002, almost 5.5 million individual or company complementary private insurance policies were taken out. Approximately 20 billion euros thus flow yearly into the insurance sector. For Schröder, “It’s not enough – no question”.
6 It has been in force since January 2004, and an 8% decrease had already been recorded in October of that year in doctor visits across the country.
7 On the relationship between the European Co-ordination policy and Hartz IV, see: Ute Behning, “Hartz IV und Europa”, Blätter für deutsche und internationale Politik, 2/05.
8 Only in Berlin, the number of persons receiving social security benefits consequently dropped from 271,000 in December 2004 to a mere 30,000 by January 1, 2005. Among many cases brought to the court, several hundreds of handicapped persons in Berlin are contesting their ability to work: Berliner Zeitung, March 23 and 29, 2005.
9 The government will evaluate in the second half of 2005 whether the allowances should be leveled in both parts of the country. Url: www.arbeitslosennetz.de/modules.php?name=News&file=article&sid=262
10 Our generic unemployed worker here is a she.
11 Energy costs are being raised up to 20% in 2005.
12 A study by the trade union ver.di shows that the legal obligation for unemployed persons to accept any unpleasant job (Zumutbarkeit) means that Muslims can be forced to work in pork slaughterhouses and women in brothels, for instance, if their BfA agent decides so. If the latter's right of reservation makes it unlikely that a woman be forced to work as a prostitute (since its legalization in 2002, the profession is considered a job like any other), the same cannot be said from the outset of positions as mini-skirted waitress, sex-phone agent, table-dancer or brothel hostess, for example: Die tageszeitung, December 18, 2004.
13 A single unemployed father raising his school-aged child has compared their situation under the former and the new system. Hartz IV brought about a drop of 25% in their incomes. Junge Welt, October 20, 2004.
14 In order to implement Hartz IV on January 1, 2005, forms had to be filled and processed at a Maoist campaign pace, which turned upside down the internal organization of the BfA. On November 11, the BfA of Berlin announced that only a third of unemployed workers of the city had filled the form. It was the joint result of the form’s intricacy, a lack of personnel in the BfA and the ‘non-participation operation’ initiated by some associations, which consisted in giving in the form as late as possible, prior to December 31, 2004. As long as their form had not been processed, unemployed workers remained under the former system and received better allowances.
15 A Berlin radio station offered a foretaste of the new system, as it followed an unemployed worker, who willingly subjected himself to the new measures, in his meetings with his agent in the autumn of 2004. During the first month, his agent made him move to a smaller flat (no allowances) and sell his car. He could keep his piano because of his insistence on the “psychological benefit” he gets from playing. Unable to pay reparations on his bicycle, he bought a monthly public transportation pass, an audacity severely criticized: “We don’t ask you to be mobile, we want you to be reachable”, hence to wait home for a phone call. In his first job interview, he did not wear a tie, to the great displeasure of his agent, but those that followed did not bring him any closer to the much-wanted job. Swiftly, he managed to stay in the black until the end of the month: he paid the maintenance charges but not the rent. It is still easier to cut electricity than to evict a tenant in Germany.
16 Press declaration from February 1, 2005 by the Koordinierungsstelle gewerkschaftlicher Arbeitslosengruppen, Bundesarbeitsgemeinschaft der Erwerbslosen- und Sozialhilfeinitiativen e.V., Erwerblosen- und Sozialhilfevereins Tacheles e.V. The association Solidarische Hilfe e.V. audited personal forms processed in Bremen and noticed mistakes in 70% of them, which usually resulted in smaller allowances: Junge Welt, November 23, 2004.
17 Süddeutsche Zeitung, July 31, 2004.
18 “Ein-Euro-Jobs in Bildungseinrichtungen”, press declaration of the education trade union GEW in Lower-Saxony; Berliner Zeitung, March 23, 2005.
19 Frankfurter Rundschau, September 15, 2004. In Essen, for example, “GemeinWohlArbeit für Essen”, url: www.labournet.de/diskussion/arbeit/realpolitik/hilfe/essen.
20 Berliner Zeitung, March 31, 2005; Welt am Sonntag, April 10, 2005.
21 Berliner Zeitung, August 10, 2004.
22 Junge Welt, January 17, 2005. Around the time of that declaration, dozens of bogus jobs for MPs, with salaries ranging to up to 60,000 euros a year, were made public.
23 Financial Times Deutschland, August 8, 2004.
24 Series started on July 21, 2004.
25 Frankfurter Allgemeine Zeitung, August 10, 2004.
26 Frankfurter Rundschau, August 9, 2004.
27 Express, 8/04.
28 Berliner Morgenpost, August 30, 2004.
29 Der Spiegel, 33/2004.
30 See their website: www.w-asg.de.
31 Junge Welt, June 26, Neues Deutschland, August 28, and Financial Times Deutschland, August 11, 2004.
32 Declaration to the press, August 19, 2004.
33 Report quoted in the Labournet Germany newsletter of August 26, 2004.
34 A well-known sign of these bonds is the percentage of union members among SPD MPs: well over 90% until the 1990s, it remains very high at around 80%.
35 Since the SPD came to power in 1998, the only counter-example of the social preponderance of trade unions has been the student strike of November 2003-January 2004 which, launched in Berlin, rapidly expanded to the whole country. Refusing the introduction of university fees, the massive cuts in education budgets announced in all Länder and the implementation of so-called ‘elite universities’, students and (some of their) professors rather called for an increase of universities' public financing and rejected the Agenda 2010. That strike is important for the developments discussed here. Because of the multiplicity of governmental coalitions in Germany (or the fact that, basically, all parties have their finger prints on a university reform programme, in one Land or another), the strike was led against all parties of the German political scene. In Berlin for instance, it was a SPD-PDS coalition that worked out the 75-million-euro reduction of the budget and the introduction of fees in the city’s three universities. In that respect the students' movement contributed a great deal to the recent social polarization in Germany. Its failure, however, was supplemented by Germany's Constitutional Court's decision of January 26, 2005, which confirmed that the Federal government is not allowed to determine an upper limit to university fees. Blätter für deutsche und international Politik, 3/05.
36 Financial Times Deutschland, October 25, 2004.
37 Die Welt and Hamburger Abendblatt, June 26, 2003.
38 Spiegel online – January 25, 2005, url: www.spiegel.de/wirtschaft/0,1518,338552,00.html
39 R. Müller, “IGM-Defensive setzt sich fort”, Express 10-11/2004.
40 Der Spiegel, 28/2004.
41 Bild-Zeitung, July 5, 2004.
42 Stern, January 26, 2005, url: www.stern.de/politik/ausland/535778.html?nv=cb
43 Junge welt, February 15, 2005.
44 Labournet Germany, newsletter of July 7, 2004.
45 Handelbslatt, October 15-17, 2004.
46 Jungle World, 39/04.
47 “Eine Woche wilder Streik in Bochum”, Wildcat 72 (January 2005).
48 Junge Welt, November 25, 2004.
49 “Ein Gespräch über Unsagbares und Unsägliches bei Opel Bochum”, Express 10-11/2004.
50 Jungle World 53/2004.
51 Frankfurter Rundschau, October 21, 2004.
52 Workers were given until February 25, 2005 to sign the form and leave. In order to neutralize workers’ discontent in Bochum, Opel agreed that workers from that plant are given until 2007 to leave. (Automobilwoche online, issue of January 29, 2005). In April 2005, Opel agreed that some workers of the Bochum plant leave until 2007.
53 See the critical letter to the enterprise works council by one shopfloor union representative and one works councillor, both from the Bochum plant, ‘Zur Opel-Betriebsvereinbarung’, url: www.labournet.de/branchen/auto/gm-opel/allg/
54 SoZ – Sozialistische Zeitung, January 2005, url: //members.aol.com/soz9/050111.htm
55 Financial Times Deutschland, January 10, 2005.
56 See the text of a Bochum Opel activist ‘Trau keinem über dir – zur Opel-Betriebsvereinbarung’, url: www.labournet.de/branchen/auto/gm-opel/allg/abbv123.html
57 See the Zukunftsvertrag, url: www.labournet.de/branchen/auto/gm-opel//bochum/zv2010.
58 Junge Welt, December 14 and 18, 2004.
59 Michael Wendl, “Paradigmenwechsel – Der neue Tarifvertrag für den öffentlichen Dienst”, Sozialismus 3/2005.
60 Jungle World, March 2, 2005.
61 Url: www.bmgs.bund.de/deu/gra/publikationen/p_19.php
62 Are considered poor the households with less than 60% of the equivalent disposable income of what is socially regarded as required. In 2003 it was evaluated at 938 euros for the first income, 470 for each additional adult and 282 for each child under 14 years of age.
63 The UNICEF report on Child Poverty in Rich Countries 2005 evaluates at 1,5 million the number of poor German children (a poverty rate among children of 9,8% in the western Länder, of 12,6% in the eastern Länder). Poverty is defined by the UNICEF as less than 50% of the average household's income. Between 1990 and 2001 the rate of poverty among children in Germany grew by 2,7%, more rapidly than in most of OECD countries. url: www.unicef.de/kinderarmut.html
64 Albert Scharenberg, “Armutszeugnis”, Blätter für deutsche und international Politik, 2/05.
65 Der Spiegel, 49/2004.
66 According to a study by the economic institute of the German trade unions, workload and different types of psychological pressure increased in 90% of the enterprises between 1999 and 2004, url: www.boeckler.de/pdf/wsi_betriebsraetebefragung_gesundheit_07_2004
67 By 2004, the number of sick days had diminished to 11,9, a new record after the 13,5 days of 2003. According to the Federal Ministry of Health and Social Security, this diminution brought about an economy of 1billion euros for employers: Frankfurter Rundschau, December 30, 2004.
68 The initiatives and debates of the trade union left can be followed through the Labour Net Germany network: www.labournet.de/GewLinke/