Demanding Democracy in the Workplace: The European Trade Union Confederation and the Struggle to Regulate Multinationals

In the Western world in the late 1960s, the post-war boom ended in growing social conflict. The squeeze on profits resulting from the intensifying competition among the major industrialized countries and from the enhanced contractual power that full employment gave to workers triggered the break-up of the Keynesian consensus that had governed capitalist societies since 1945. In response to the dramatic pay increases and growing workers’ control at the shop floor level, an increasingly mobile capital ‘“voted with its feet” by intensifying and deepening the geographical relocation of manufactures to lower-wage areas and also by an increasing financialization of its activities. While the larger part of the European trade unionists sought a response to the resulting challenges within the confines of the nation state, they also discussed the idea of promoting a supranational regulatory framework to restore the form of embedded liberalism that had previously shielded national societies from the disruptive effects of self-regulating markets, assured unprecedented levels of growth and brought about the recognition of the unions as legitimate interlocutors of power. In the early 1970s, this promotion of a supranational regulatory framework translated into an attempt at enlarging the social scope of the EC’s policies, in a sort of European rescue of the Keynesian State. The heterogeneity of the union movement and the resistance of the employers made it difficult to follow up the early initiatives. By the end of the 1970s, however, when the crisis of Fordism began seriously to undermine the basis of the unions’ power, they renewed their efforts for a partial supranational re-embedding of market forces. These efforts profoundly influenced the course of EC politics in the long run, although more as a consequence of their initial defeat. To reconstruct the unions’ role in EC politics and the issue of MNC regulation, the first section of this chapter sketches the origins and main characteristics of ETUC and its role in European politics. After a brief introduction to the EC debate on MNCs in the 1970s, the second section (drawing on research in eight archives in three countries) analyses the rise and fall of the Vredeling proposal. The final section then draws out some general conclusions about the role of the unions in EC politics and how it has changed over time.