[TALK] Lucien van der Walt, 2017, “The Political Economy of the Rhodes Industrial Action,” seminar on “Students and the Strike,” Asinimali, Rhodes University, 28 April.

Popular talk: Lucien van der Walt, 2017, “The Political Economy of the Rhodes Industrial Action,” seminar on “Students and the Strike,” Asinimali, Rhodes University, 28 April.

This talk was part of a panel arranged by the ‘Asinimali’ student group at Rhodes University, South Africa, as an unprecedented strike by staff took place at the institution. The strike drew in workers from both the National Education, Health, and Allied Workers Union (NEHAWU) and the National Tertiary Education Union (NTEU). It was unprecedented in its scale,  and in bringing together unions from different traditions, representing to a large extent different layers, which traditionally do not cooperate. NEHAWU (my union) is affiliated to the (formally Marxist) Congress of South African Trade Unions, COSATU, and mainly represents blue collar and lower level support staff; NTEU is affiliated to the (moderate) Federation of Unions of South Africa, FEDUSA, mainly representing academics and mid-level and higher administrative staff.  The panel included NEHAWU shop-stewards, the audience were mainly students. This is a transcript of my talk.

Lucien van der Walt: – Ah, thanks everybody for coming. I just want to mention that I am a member of NEHAWU, but I am not here in an official capacity. I try to do my best in the unionm but I am just an ordinary union man, so this talk isn’t an official union position. I was just asked to give an analysis of what is going on and locate it the larger context.

The most immediate thing is that the two big unions on campus – that’s NTEU and NEHAWU – which between them represent perhaps 1000 out of 1400 staff, are engaged in an unprecedented joint programme of industrial action. So far this has really meant go-slows and pickets; and informally, it means people being absent from work and going home a bit early and so on. And you’ve probably experienced this with lecture halls being locked when you get here in the mornings, or dinners being late, and so on. But this could escalate to a protected strike.

Now this sort of joint action hasn’t really happened before and with NTEU involved, we also have a layer coming in, of lower-income secretaries, administrators and some academics. Usually NTEU and this layer is quite absent from these sorts of strikes. This time it’s involved and this means there is a wider range of people actually involved in actions than before. These are not layers that usually do industrial action.

So now what brings all of these people, these workers, these staff, together? What brings two unions that have never really worked together in a joint industrial action, who have only negotiated together, before, but now act in a joint industrial action? What brings them together?

The most immediate thing is that management did not negotiate last year with the unions at all around wage increases. So there is a lot of pent up frustration. They used the disruptions around student protests to argue that they didn’t have time and they delayed negotiations a year.

The second thing is that management has consistently – since current negotiations restarted – offered below inflation wage increases. I think its offers started off around 2% and moved up to 5%. Now what it really means is actually a wage cut. Inflation is around 7.5%, so if you get 5% you’ve lost 2.5%. And food inflation is around 11%.
So just to give a simple example, if you’re getting 4000 bucks a month, 5% will give you about 200 bucks a month. So it’s actually a wage cut because you’d actually need R300 a month just to stay where you were last year with general inflation, and R400 if it was just for food. Okay, so although it seems like a wage increase – and although management was very angry when we referred to it as a ‘wage cut’ when we called the mass meeting of academics last week – it’s a wage cut. People are not keeping up with prices.

The third thing is that we need to understand this in context of a larger crisis in South Africa, the capitalist economy of which is based on massive inequality, a mass unemployment regime and a cheap black labour system. Please bear in mind the context: South Africa’s economy is based essentially – and it remains based essentially – on cheap black labor.

Until the 1980s, this low-wage economy was reproduced through state interventions. The state would restrict black workers’ ability to unionize; the state would restrict what jobs people can do; where you could find work, and would reinforce the homeland system as a means of pushing wages down.

At the moment this cheap labor system is reproduced through the market … not through the state, but through the market. On the one side, it’s the mass unemployment system which keeps wages low. There are always people looking for jobs. On the other there is a massive pool of cheap, casual and flexible labor. And although the media keeps insisting that South African workers are too likely to strike, have too many rights that their wages are too high, the reality is that only about a quarter of workers are actually covered by wage bargaining agreements and unions.

And the unions? Although the unions are strong, and our union numbers are remarkable in that they have stayed quite stable, despite mass unemployment, the unions are actually quite a small drop in the ocean of the working class. And even being a member of a union doesn’t always mean you have high wages. Many union members are under strain, because they have low wages And being in a union doesn’t always mean you’re protected from the larger situation. We have a low-growth, low-wage, low-innovation,high unemployment economy. The worker with a job, and the union worker, is still part of the larger working class and is affected.

So we have a situation where wages in many sectors are stable at best, but sometimes declining. Employed workers support numerous unemployed family members. According to a figure from NEHAWU, each employed person in Grahamstown is supporting 40 other people. So each salary is not just a salary for that one worker to spend on an immediate, small family. It is actually supporting vast networks of other people. So its not like workers and the unemployed are separate groups, with different class interests.

So, the pressure for high wages has to be seen in this context. There is all this immense pressure on working people that is driving demands for more wages.

Meanwhile, there is also the growing confidence that the working class and working people have developed over the last few years with important strikes in mining, in post and so on. The victories and the demonstrations  of power and solidarity, and innovative forms, some non-union, have raised the temperature of the larger working class.

But now why is the university not willing to pay? Why is it trying not to pay? The simple reason is that the university is running broke; the university is running out of money, just like the rest of the state. The figures that have been provided for how close to broke the university is, well, don’t really know which ones we can trust. We get different figures in different contexts and from different people.

We can’t get accurate, direct access to the raw data, so we actually can’t crunch numbers. We’re presented with fixed numbers. And what management says in one forum – and what one person says in one forum, what another person says in another forum – actually varies a lot. So it’s like shooting at a moving target. Yes, the management sometimes stresses the financial problems, and this is used to instill a bit of climate of fear –  will we have jobs? – but there is something real under there.

The current position is that university is probably going to be short 69 million rands over the next two years. So this information we have, says management wants to cut 15 million rands this year, and around 25 million next year. And the easiest way to cut is to target wages. They are looking at other measures as well: freezing posts (for example, there’s a supposed ban on appointing contract staff now), reducing the number of permanent staff, cutting Teaching Assistant posts, and using more casual labour.

As an example, Rhodes doesn’t really do large-scale outsourcing like Wits or UCT have done; and this is why the student movement for #FeesMustFall here did not turn into #OutsourcingMustFall like at Wits. But what Rhodes does do, is reduces the number of people on permanent jobs, and increase the pool of casual people.

So I did a bit of investigation, I phoned people in kitchens’ management, as I was asking for someone I knew, looking for a job. They said that person must go on the waiting list. I asked how long the waiting list was, they said 200 people. So what happens to these 200 people? When there’s a bit of work they need done – for example graduation – they pick two or three of them, but they can’t get a permanent job without moving up the list, and that is only when permanent people go. What happens after the short job at graduation, for example? They’re gone.

So, you can still cut wages and casualise workers without outsourcing. Outsourcing and labour brokers are just methods,  we cannot and should not be fixated on them. Now, if you’re cutting wages of the permanent workers, through below-inflation raises, and you’re reducing the amount of the permanent workers, and growing the pool of  casual workers, you save money.

But now, why is there a shortfall in university finances? Well, one reason – and this is the one management actually like to speak about – is that there have been unexpected costs over previous years. These include a rise in electricity prices. The bad water situation in the town, the failings of the municipality, forced the university to spend millions on water tankers, and other water-security measures. Because the municipality was in a mess, nothing due to university, but able to sink the university. They also spent a whole lot of money on security last year during the protests, as you know: all the “bouncers” that were brought in, all the security cameras that are everywhere; legal fees – they had a legal case against academics around – and there’s a case around an interdict the university sought; there are prosecutions against students, all of these things.

But these immediate problems, important as they are, are not the real cause. The real cause is that government is giving universities less money every year. Essentially the state subsidizes some university costs. There is a formula, providing universities grants per student and per research output., varying according to first year, second year, masters, PhD, and field, for example more to natural science than, say, Drama.

But even with that situation, the subsidy the state provides is falling. Its been falling since the mid-1980s. Right now, around 40c of every rand this university spends comes from the state. And 30 years ago, around 80c out of every rand spent would have come from the government. Now it’s 40c. Half is gone.

So this means that universities tried to find ways to raise more money, and cut costs. One way is to increase student numbers, to make up for the lost money, they keep trying to grow. If each student earns less subsidy, have more students. They keep trying to increase research outputs. But this is not enough. So they keep raising student fees. Every student, fee-paying  or not, is subsidized, but its not enough. And there is a limit on how high you can go with fees. I think we reached the tipping point there about two years ago: students revolted, which is part of what #FeesMustFall is about.

They have not just been reducing staff, and casualising, but also running down infrastructure. I always like to use this room, this venue, as an example. That water leak causing damp there, has been there for many years, we’re quite familiar with it, almost like a good friend. And if you look at the room’s furniture, the styles, the old green curtains, this is all stuff bought more 25 years ago.

If you look around in any venue and building, you’ll see some the crumbling infrastructure. So that’s also how they have been deferring the  money problem. Just not keeping up with maintenance.

But this all raises the question of why the the state doesn’t give more money to the universities? Why is it cutting as well?

There are two big things happening, and here is where we see how capitalism fits in. The first, really important issue I want to stress here is that the state is running out of money as well. It’s under a lot of fiscal pressure.

Essentially, growth rates in the world capitalist economy has been low for the last 40 years. The whole world is actually in a huge financial mess. That means governments do not get enough money. Taxes are not enough, loans are more expensive. From the 1970s, there was an onset of a massive capitalist crisis. There was a second shock 2007/2008 with a global financial crisis. So that means they’re trying to spend less, because they have less

The second really important issue is that the dominant political and economic elite – the ruling classes in different countries around the The second world – are using the crisis. It’s not fully that they’re going broke, but carrying on like they did before the 1970s. They are using the crisis to dramatically restructure society, opening a new phase of capitalism. What they’re doing is what we call neo-liberalism; and that is a about free trade, flexible labour, privatisation, and spending less and charging more.

For universities this is expressed in spending less, charging more. It is also based on the idea that, as elsewhere, the elite should centralize power and should commercialize and privatize everything that it possibly can. Resolving the crisis through neo-liberalism is about trying to impose the logic of profitability and centralised power on all areas of social life, about doing more with less, whether that is harder work for lower wages, or worse services for higher prices, or whatever. It can mean removing trade barriers, for example,m it can also mean re-imagining the university as a corporation, as “University Inc.,” as a “market university” where you can only really have a course because it makes money; not because it’s valuable. Where you can only do research because it’s “relevant,” and “relevance” can means useful for business or government. There is no space here for history or science that does not have direct use to the ruling class right now.

So, around the world the effects we see in the era of neo-liberalism – it is not just a theory, a policy, it is an era,  a phase of capitalism – is an upwards redistribution of wealth and power. Around the world, what’s actually happening despite all the talk about rights and opportunities, is that money and power are moving up to economic and political elites.

In South Africa, of course, there has always been an unequal society under tributary, semi-feudal and capitalist modes of production, but what we’re seeing here is an increase in inequality. examples, the richest three South Africans have assets equal to the incomes of the poorest 26 ) million. Richest 3, poorest 26 million. That’s worse than it was in the 1980s, and the 1980s were kak, a crime against humanity.

What we have is an ongoing problem and measures that reproduce some of the worse of the past.

While ordinary working class and poor people get pushed down, and get told there is no money, accumulation is taking place for the elite, systematically through states and through corporations, including by what we often call corruption. Inequality is not an aberration, an ill society, or corruption of a basically good system, its the nature of the system, not a crime against it, but its very heart: ruling class elites accumulating wealth and power at our expense.

The political system, the system of parliament, has always been a pretense; it’s not a real democracy because the voters do not really control what goes on at all. It’s become increasingly obviously hollow, as all the political parties are more and more, the same. More and more people are disenchanted with that system. More and more people feel there’s no real choice. So as real ideas and options disappear, as the left fails to make headway, party politics dominates and becomes more about personalities, factions and media sound-bites, quotes and tweets, a circus. Donald Trump is an example of that, but we can see it everywhere in the world.

This is linked to a systematic ruling class drive to disorganize, demoralize and confuse the popular classes, the ordinary people around the world. There are various ways which this is done: casualisation, mass unemployment; the promotion of divisions, for example, like between nationals and foreigners; (inaudible) stratified work forces, and patronage, buying off layers of working class by moving them into the middle and upper class layers.

There is a massive intellectual and political assault, through ideas like nationalism, post-modernism, liberalism in the American sense, crude identity politics.

We haven’t entered a world free of work, or a world of choices, and rights, but a world in which mass unemployment is the norm, not a post-work world, but a planet of slums based on sustained mass unemployment, where every division in the popular classes is amplified, whether by the populists like Trump, or the liberals like Clinton, or the “think tanks” and funders that promote nonsense like post-modernism.

These measures are required because mass unemployment keeps wages down, divisions split the popular classes, and a destruction of left traditions and science cripples the possibility of creating a new and better society.

Now, in closing, let’s bring it back to our university. If we look at the university, we can see these things playing out; the crisis is transferred downwards; the university is short of money, but there is no real discussion of how money is distributed within the university. For example, we have a dispute centred on wages, but management salaries are not actually under discussion or even negotiated. Negotiations cover grades 1 to 17: senior or top management is outside of this entirely.

And while cooks an cleaners are told to eat less, this is in the context of an increasingly unequal university. If we look at the university like this there’s a lot of interesting facts that are publicly available. Research output by academics – which of course is also made possible by the work of support and other staff – has doubled, doubling subsidy income for research. From 2004-2014, the amount of articles published doubled! But wages for most staff have stagnated or declined in real terms. In the best years, we get 7 % means your wage hasn’t actually changed. In some years, like this one. it actually reverses. And, as for academics, this university pays less than any other research university in the country.

But at the same time salaries for the upper layer, top management, has grown. So the top people at Rhodes, the VC and DVCs, get an average salary of 2.1 million a year. For comparison, in 2015, the State President Jacob Zuma earned R2.62 million (excluding benefits). The  middle later gets around R450,000 a year. Support staff average in some calculations 190 000 a year. These are averages: there’s a lot of people in those layers that get much lower incomes.

So when I talk about the pain going downwards and the rewards going upwards, I mean exactly that. You’re telling workers, some of whom are getting R4000 a month to take a wage cut for the university; and at the same time management salaries have increased at an awful rate. Another example: a a Dean at the university used to be paid an ordinary academic salary plus a stipend; nowadays the average salary of a dean is over a million rands. In 2014, the salary of this town was just a bit over R700,000 including most allowances.

So when we talk about crisis, financial problems, policies … its never a simple thing in which an objective crisis which affects everybody equally, and is neutral. Crisis and problems are expressed in conflict, and are transferred downwards to the masses in a class system, by elites that make the decisions, without it being really discussed or debated and without taking the pain themselves. Whether VC, DVC, Presidnet or Mayor, the powerful make the calls and look after their interests.

In this situation – crisis, neo-liberalism, class struggles – universities around the country are gutting the remnants of democratic decision-making. These were usually for more senior academics, admittedly, not everyone at all, but these have often been removed. We have it here too. Decision-making is moving upwards, and jobs and costs are cut everywhere except for managers: this is often called managerialism. So we do have structures like faculty boards which give people a say; union people sit in Senate, like professors, which supposedly gives them a say; the SRC sits there.

But many key choices are not made in Senate, which had become more like a report-back session, on what has already been decided. An example I can give is that a progressive colleague of ours has repeatedly asked how much has management spent on security cameras, on “bouncers,” on legal fees. they have been effectively refused an answer. This is for a year now. So we seem to be participating, just as with voting for parliament,  we’re not really, Real decisions are made elsewhere or in ways that we can’t affect without struggling from outside. So it’s a very hollow system.

And just to close here: the past continues. If we talk about 5% across the board wage increase, we’re actually talking about someone at two million will get R50,000 more, and we’re talking about a situation where a person at the bottom, getting R4000 a month, or  R48,000 a year, will get just R2,400 more. And because the workers at the bottom are generally black and Coloured and cheap, this reproduces the racialised cheap labor system we spoke about, the colonial wage, if you like, the apartheid wage gap, for the black working class.

So if we want to understand the crisis here we need to look beyond management’s argument that this is just a sudden crisis that came out of nowhere, or the idea that ]we’re all sharing the pain, or that everything will be all right, we just need to be quiet, and make sacrifices.

I believe the only honest conclusion we can draw here is that unless people resist, things will get worse. If workers lose on this round, the next round in the middle of the year will be worse. If some departments are closed, other departments will be closed later. If people are pressurized to buckle now, they surely will be pressured later.

And academics who think this is just going to happen to secretaries and gardeners are very much mistaken. Very much mistaken. This will come all the way through.

Thank you very much. The next comrade is starting now.


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