The Asian miracle evaporates
* South Korea Should the possibility of collective stupidity be factored into the Marxists analysis of the class struggle? If recent action taken by the Korean government is anything to go by, perhaps it should be. Terry Lawless [Seoul] — What other name but stupidity can be given to the ramming through of a whole series of legislation in a secret seven minute pre-dawn session of government legislators, which immediately touched off the worst social crisis yet faced by the Kim YoungSam regime, bringing unprecedented bad international media coverage only weeks after Korea joined the OECD and posing the threat of the biggest general strike in the nation's history? What other name for this action by the political officers of a government supposedly committed to budget deficit management which by its political heavy handedness lost more output in three weeks than in the whole of the previous year? What other name can be given to a government which managed to achieve the greatest degree of union solidarity yet seen in Korea, jolting the conservative and state-sanctioned Federation of Korean Trade Unions (FKTU) into an official general strike call in active collaboration with a still-illegal rival organisation?
Perhaps, however, stupidity is merely another name for the ultimately global limitations to political action placed on each national bourgeoisie in the context of a neoliberal world order. The reason for these "stupid" actions may simply be that the effects of joining the OECD are anticipated to send huge shock waves throughout the Korean economy, bankrupting many firms and businesses and reorganising many local and national markets. The stern measures taken, from this perspective, are unavoidable if Korea is to continue to tread the fine line between competing for a share of key markets with the G-7 countries while anxiously warding off the challenge represented by the substantially lower labour costs in some of the emerging economies of South East Asia. As President Kim Young-Sam said in his New Year's address: "Someone had to do it." Optimism...
The remark might well have surprised Kim Young-Sam himself a year ago, for 1996 was supposed to have been a banner year for the Republic. At long last, the thirty-year old dream of the former President General Park Chung-Hee was to come true: Korea was to join the ranks of the advanced 2 International Viewpoint countries by becoming a member of the Organisation of Economic Co-operation and Development (OECD). All the old arguments about developing countries not being able to afford democracy (which apologists for the eighteen year rule of President Park repeat to this day) might safely be set to one side.
As part of the process that President Kim calls "settling accounts with history", two of the country's former Presidents, Roh TaeWoo and Chun Doo-Hwan, responsible for the 1979 coup d'état which followed Park's assassination and the 1980 Kwangju Massacre, were put on trial. Chun was even initially sentenced to death. A second set of elections were held which appeared to confirm the implantation of civilian government, al BESNESS NEWS despite the persistent rumours that President Kim's 1992 election campaign had benefited by money it received from Roh Tae-Woo's slush money fund. Korea even succeeded in winning the co-hosting rights to the 2002 World Cup with its long-time imperialist oppressor, Japan. ... and harsh reality
Despite all this, 1996 will be remembered by the Korean bourgeoisie as the year things began to go wrong. An 80% fall in the price of semiconductors was the first of a number of unexpected blows, slicing into the profits of chaebols (conglomerates) like Samsung, Hyundai and LG (formerly Lucky Goldstar) and creating knock-on effects in
the auto, steel, electronic and petrochemicals industries. Samsung, which reported a profit of 2.5 trillion Won ($3 billion US) in 1995 saw that figure reduced by a third in 1996. Growing pains
The steel industry, one of the other main pillars of the economy, is facing major problems. On January 24 1997, Hanbo Iron and Steel, the second biggest steel producer in Korea, was taken over by four banks following its inability to pay off about 5 trillion won to its creditors. The banks will temporarily provide additional money to complete the world's fifth largest steel complex in South Chungchong Province, although the company's long term future and the short-term financial health of the banks themselves are in doubt. Hanbo ranked 14th in terms of total assets and 18th in terms of annual turnover among Korean chaebols; it seems set to become the biggest bankruptcy and possibly the biggest corruption case in Korean history. There are rumours that the son of Kim Young-Sam is implicated in the extension of credit to a company that patently did not warrant such financial trust. lo compound the problem, the OECD recently predicted a global overproduction in steel for the turn of the century, and criticised the ambitious expansion plans of Korea and China. As a result, the Korean government has just turned down a request by the Hyundai Group to build a new integrated steel mill.
The 1996 trade deficit was $20 billion, twice as high as the previous year. Reasons for the deficit included importation of crude oil to support a 9.8% growth in annual energy consumption, increased imports of a range of manufactured goods, and trade imbalances like the $657 million deficit with Japan in auto parts. There were rumours of the impending take-over by Samsung, the third biggest motor industry chaebol, of the seventh, Ssangyong, which has seen mounting losses. Despite a continuing boom in construction, the insolvency rate in the motor industry jumped from 1.9% in 1994 to 6.6% in 1996, when there were 196 bankruptcies out of a list of 2,958 registered firms.
The weakness of the Japanese yen made Korean manufactured goods less attractive, and helped to drive down the value of the Won by 10% against the US dollar. The Korea Stock Price Index (KOSPI) went into free fall, in part due to foreign investment sell offs. It lost 300 points, or a third of its value, over the course of 1996. And despite a still internationally strong growth rate of 6.8%, there were problems with inflation. The rate for 1997 is already anticipated to be 4.5%. Unemployment
Worst of all perhaps for this nation of hard workers, the unemployment rate continued to creep up. In November 1996 it was 2.2%, and expected to rise, particularly among young university graduates who are coming onto the job market at a time of uncertain transition. The prevailing bourgeois wisdom is that many Korean companies will need to start shedding workers if they wish to remain competitive as Korea opens some markets to the rest of the world. This corporate restructuring will be accelerated by the highly ambitious changes in the financial sector, which will allow banks, security firms and insurance companies to trespass on each other's domains starting in April 1997. Entry into the DECD
On December 6 1996, Korea became a member of the OECD. As part of the requirement for greater transparency and international accepted standards of labour relations, the Kim Young-Sam government had set up a Presidential Committee to revise the labour laws. The essential changes that were to be made included a number of provisions which would begin to undermine the high levels of job security presently enjoyed by Korean workers. The new labour law would make it easier to lay off large numbers of workers during periods of restructuring or corporate take-over, introduce the concept of "flexible" work schedules (whereby workers would be available to work at any time during a monthly calculated schedule, thus effectively eliminating overtime pay) and allow for the use of scab labour during
There were also further provisions which would have ensured a greater level of political freedom for the Korean working class, basically bringing conditions into line with the G-7 countries. At present, Article 12 of the Trade Union Act makes it illegal for unions to engage in any political activities. Three key provisions of the new proposals were the acceptance of the right to form more than one union in a given workplace; the right for third parties (including political activists and parties) to intervene in labour/management disputes; and the right of unions to engage in political activity, up to and including the formation of a workers party. In addition, there was talk of some kind of recognition being offered to civil servants and teachers to form labour associations, which would still fall short of complete
These changes would have meant that the government had resigned itself to recognising the legality of Minchu Nochong, the Korea Confederation of Trade Unions (KCTU), which formed after a militant breakaway from the Federation of Korean Trade Unions (FKTU) in 1995. The FKTU currently organises about 1.2 million workers and the KCTU 750,000. The KCTU was instrumental in the waging of a number of key strikes in the summer of 1995, particularly in shipbuilding and car manufacturing. As a result, workers' wages increased by approximately 12% last year. It had been anticipated since last summer that the KCTU would offer some kind of generalised resistance to those aspects of the changes which were detrimental to labour, as union leaders had indicated over the course of the Commission's sitting. When the Commission concluded its investigation without reaching a compromise, President Kim asked that a new document be drawn up which he wished to see passed by the National Assembly at the end of the current parliamentary session.
contents the event
Korea: the Asian miracle
2 evaporates • Terry Lawless europe
Serbia: Milosevic's manoeuvres
5
• Catherine Samary
7 Sweden: Volvo workers ready for change • Peter Lindgren
8
Britain: Palestinians get Irish treatment • Roland Rance
9
Britain: Trade union lefts increase co-ordination • Fred Leplat
Turkey: Prosperity? No thanks!
• Interview with Utak Uras (ODP
11 Portugal: Abortion still restricted
• Sérgio
12 Belarus: The 18" Brumaire of
Aleksandr Lukashenko • Vladimir
Shimanovich and David Mandel africa
15 Rwanda: Genocide victims pay for machetes • Colette Braeckman
16 Zaire unravels, west panics •
Alain Mathieu
17 Fourth International declaration
Zaire: CRAP in action • Eric Toussaint
18
19
Algeria: human rights 'surrealism'
• interview with Housin Zahouan americas
Argentina: blackout in Buenos
20
Aires • Eduardo Lucita
22 Mexico: Tepoztlan, rebel town
• José Martinez Cruz
22 Mexico: Old world pressure
23
Ecuador: Getting rid of "El Loco"
• Fernando López
Feminism: a new look
25 introduction
26 Women in South Africa • Roseline
Nyman
28
South Africa: Towards a grassroots women's movement
• Rita Edwards
29
Canada: Women's march against poverty • Mark Johnson
31
Chile: More confrontation than debate • Ana Canales
33 Three waves of Mexican feminism
33 France: Now hear this!
regular features
34 book notes • What Women Want, by Patricia Ireland • Lean Production, by Tony Smith
36 NetWorking • our guide to Internet action and hot addresses
36 well read • a very incomplete review of the radical media
March 1997 #286 3
* South Korea Parliamentary Politics
For one week before the extraordinary secret pre-dawn session, currently the subject of a constitutional challenge, the two opposition parties had been waging a filibustering campaign at the National Assembly. This involved a sit-in and the actual physical restraint of the elected members of Kim YoungSam's New Korea Party (NKP). The opposition wished to see entry into the OECD subject to an extended debate. Following the
April 1996 elections, the NKP had a wafer-thin majority in the National Assembly, because of the secret recruitment of aligned and non-aligned December 26th session, crats were further outraged by the defection of three senior members of their party to the NKP. So tensions between the parties was quite high.
The main opposition parties, the National Congress for New Politics, led by Kim DaeJung, and the United Liberal Democrats, led by Kim Jong-Pil, an old crony of President Park, were set to continue their resistance, at
It was a great surprise for Korean citizens, when they woke on December 26, to find that some of their legislators had been busy passing twelve pieces of legislation in absolute record time, including a Bill to restore the Agency for National Security Planning, the Korean secret police, which they had decided not to consult the opposition or the nation about. The new labour bill had been modified substantially, retaining all those aspects favourable to management and delaying the implementation of the provision relating to multiple unions in workplaces until the year 2000, thus effectively delaying the legal recognition of the KCTU for another three years. The Dynamics of the Strike Wave
The reaction of KCTU to the passage of the legislation was instant. As news spread of the session, key sectors of the workforce began to walk out. The industrial town of Ulsan in the south-east of the country was exemplary. Ulsan contains both the largest shipyard and the largest car plant in the world. Altogether, Hyundai has ten factories located here. By December 27, the town was closed down. The three biggest shipyards, Korea Telecom and the major car maker unions at Hyundai, Kia, Daewoo and Ssangyong, also set their tools down on the first day of the strike. This same day the FKTU organised a rally of 10,000 workers in Seoul.
By Saturday December 28, depending on how one counts heads, there were between one half and one million workers on strike as the FKTU asked its members to join in, extending the call for a stoppage until December 31. Fourteen general hospitals, including Seoul National University Hospital, were providing only emergency service. Big industrial cities like Changwon, 4 International Viewpoint
Masan, Ansan, Kwangmyong and Kwangju were all seriously affected. The subway workers in Seoul and Pusan were set to go out, although they would be replaced by scab labour. And the taxis and buses declared they would go out on December 30. However one adds it up, it would seem that the events of these first few days represented the biggest organised strike in Korean history. By Monday December 30th, the government, sensing that things were getting out of hand, threatened to arrest twenty of the key union leaders, including seven members of the KCTU who chose to camp out in Myongdong Cathedral, the centre of the Korean version of liberation theology. On the last day of the year, stock prices reached their lowest level in four years.
Kwon Young-Gil, the chair of the KCTU, strategically called a halt to the labour actions in order to allow for the uninterrupted enjoyment of the New Year and to give the government time to think through its foolishness. Meanwhile, the telecommunications and television broadcasting unions threatened action if the law was not rescinded by January 3rd. Bank workers threatened to walk out on January 4th. It is important to stress that at no time were certain key industries shut down in order to minimise public inconvenience: these included railroads and other utilities. Semiconductor and electronic production were also largely unaffected. Third wave
The general strike resumed after a two day holiday. It is difficult to make exact estimates: the KCTU reported 90,000 workers at 44 businesses while the KCTU announced 150,000 from 553 trade unions as the strike resumed. On January 6th 230,000 more workers were supposed to join in again. The action then began a slow build up to the general strike which was set for January 1415th. Once again, this would have involved up to a million workers: 250,000 from the KCTU and 750,000 from the FKTU. On January 10, the arrest warrants for the twenty union leaders were produced, while Lee Hong-Koo, the NKP chair, suggested a television debate. the KCTU rejected this as the strike momentum was still very strong.
On Monday January 13th the Trade Union Advisory Committee of the OECD and the International Confederation of Free Trade Unions were warned not to interfere in Korea's internal affairs after they sent representatives to rally with the unions. However, the general strike proved not to be as effective as the unions had hoped. Taxis and banks were working for the most part in Seoul on January 15th. There was, however, much more solidarity in Pusan among the taxi unions. On January 17th, the first arrests took place as the goverment sensed that the unions had lost the initiative; and the KCTU belatedly accepted the offer of a TV debate.
By Monday January 20th most workers were back on the job following a KCTU announcement on the weekend. the KCTU announced that every Wednesday there would be a one-day strike, excluding the public sector workers, until the law was annulled. In the event of its passage into law on February 18, the union organisations have threatened another general strike.
On Tuesday January 21st, Kim YoungSam met with the two opposition parties and announced that the disputed labour and spy bills would be revised. He also suspended the arrest warrants for all the union leaders, and indicated that the five leaders being held would soon be released. On this same day the union advisory board to the OECD stated that Korea's new law did not mean their Some Conclusions
The parliamentary opposition was timid and belated. Little or nothing can be expected from the opposition parties led by Kim DaeJung and Kim Jong-Pil. The government's slight change of heart was the result of the action of the Korean working class. Once again, Korean democracy was safeguarded
The ruling NKP has lost a lot by its actions. This may well now change the outcome of the Presidential elections in December which President Kim's handpicked NKP candidate might have otherwise been expected to win.
These events were Korea-specific, although they may yet foreshadow similar upheavals elsewhere. They represent the first attempt by one of the Asian tigers to make a permanent transition to the big league. As the labour law revision demonstrates, this can only be done at the expense of the working class. However, the paradox is that economic growth and concentration like that in Korea has also created a highly organised and militant working class which can successfully organise to protect its interests.
The secretive nature of the law revision also reveals quite clearly the inability of the political leadership in Korea to break with the successful bad habits of the past. The attempt to revive the secret police shows the deep mistrust that bourgeois circles continue to have of Korean workers and students.
It is possible to win a battle and still lose the war. But it is still unclear whether President Kim Young-Sam has even won the battle. The close co-operation of the two union organisations is a very positive outcome of a sloppily waged bourgeois offensive. The Korean bourgeoisie is in search of a new miracle. There are a lot of new kids on the block - Indonesia, China, Malaysia — who may prevent this new miracle being found. Breaking out of the national framework to seek international investments and profits may lead to the emergence of old fashioned problems like high unemployment and more failing businesses in Korea, particularly with the onset of a new generalised world recession. Similar difficulties and maybe a similar fate await the bourgeois leaderships of Singapore and Taiwan, should they embark on a similar course. *
We published a chronology of the general strike in South Korea in last month's issue (#285).