• The German Miracle? Interests and Orientations for Action During the Crisis – the Perspectives of Those Affected

  • By Wolfgang Menz , Sarah Nies , Dieter Sauer , Richard Detje | 10 May 11 | Posted under: Contemporary Capitalism , Democracy
  • The economic and social map of Europe is jagged. In 2010, the production of social wealth decreased for the third year in succession in Greece, Spain and Ireland. Also, Italy and Great Britain did not find a way out of the crisis, but seem to have gotten caught in a stagnation trap. Even France is showing some effort at returning to a path of expansion. After the financial and real estate crisis, the crash of the boom and the coup d’état of the banks in regaining their stability through the tax payers’ money, the continent has now ended up in the straitjacket of austerity policies. That this is imposed by the EU and the IMF as a “rescue net” leads to growing anxiety as to whether in the near future the Euro-zone will end up in ruins (IMK 2011).

    How differently the situation in Germany is developing. A deep slump (-4.7%) was followed last year by the most vigorous boost (+3.6%) in the EU; only Sweden’s comeback was greater. While in the neighbouring countries the officially documented unemployment rate – among youth in particular – has increased, it stagnated in Germany even in the deepest crisis trough and has just recently dropped further. Something inconceivable seems to have happened to which some refer as a “German miracle” (The Economist, May 11, 2010).

    This impression is supported by a second observation. While the European Mediterranean countries experienced several general strikes, even in Ireland and Great Britain parts of the population took to the streets against social cutbacks; in France “boss-knapping” was practised as an entirely new form of protest on the workplace. On the other hand, the current state of affairs in Germany is described as a “crisis without conflict” (Offe 2010). It is also so far a “crisis without an awareness of the crisis” – another “German miracle”? Does one factor – the relief of the labour market – suffice to explain that the “crisis of the century” can, so it seems, go forward without any noteworthy social and political friction?

    We have dealt with these questions in the context of a small project which involved interviews and organised group discussions undertaken almost at the epicentre of the crisis: with trade-union representatives and shop stewards in the metal and electronic industries, in which in the first half of 2009 production dwindled in a free fall in part by 30-40%1. In what follows we present some of the project’s findings.

    From the economic crisis to the crisis of legitimation

    That the diagnosis of a “crisis without crisis consciousness” is false has been shown in numerous opinion polls of recent years (Bischoff et al. 2010):

    Even taking account of variations of perception, a clear majority of the German population shares the perception that injustice is increasing in society, in particular as far as the distribution of social wealth is concerned between incomes from capital and assets, on the one hand, and incomes from wages and social welfare, on the other.

    This intransigent perception of injustice has called into question capitalism’s traditional resources of legitimacy. This comprises the idea of a “social market economy” in which the labour/capital conflict has been pacified in a symmetrical class compromise. That the “German model of social market economy” has stood the test of time was still believed at the beginning of the new century by 70% of people polled; in October 2010, however, not even half of the population considered this to be true. Moreover, the central dogma of neoliberalism, that “more market” is required, is supported only by a minority; a distinct majority thinks that “more social security” is necessary.

    Future prospects are regarded with scepticism: Approximately half the population expects there to be “less social justice” in a few years. Three-quarters of the population do not expect an economic boom.

    The breadth of systemic delegitimation is emphasised in a study conducted by one of the major private think tanks in Germany: “There is a lack of trust in many respects – vis-à-vis banks and financial services, vis-à-vis entrepreneurs and managers, politicians and the political system as a whole, the traditional media and even regarding the ways in which the social market economy – as the central anchor of our social model’s identity – is currently being implemented” (Bertelsmann 2011: 11 f.).

    What is a crisis and when is there one?

    This and comparable opinion polls on the perception of increasing social injustice raise, in a more urgent way, the question of how the crisis is being experienced and the ways in which it is being tackled.

    Our first finding: Even at its centre, the crisis is not working like a great equaliser that causes everyone to see the crisis in the same way. Rather we found a range of graded perceptions of the crisis. Just to illustrate the range:

    On the one hand the crisis is perceived as a “hard blow”:

    “… Three years ago you still had completely different perspectives. … And then, all of a sudden … you had this crisis … You fell back. You were completely at the bottom again … this was really a hard blow.”

    At the other end of the scale, the crisis appears as a staged presentation of power:

    “The alleged crisis is used by the companies to increase their profits.”… “All the media, our banks are playing that up. It is they who are in a state of crisis … One can easily see that. It is they who are running in the red.”

    Indeed, in the years between 2008 and 2010 the crisis was the topic, ubiquitous in society, politics and the media. However, which situation is in fact described as a “crisis” is not self-evident, but subject to interpretation. In this context, it is the trade unions who are confronted with a particular challenge. Their presence in the workplaces and the capacity of trade-union political education work determine whether a general or a fragmentary understanding of the crisis will develop. And there is another structural component which must be considered. Everyday consciousness is characterised by “a ‘split’ between the perception of one’s own affliction and the interpretation of the overall social situation. The social situation is perceived as a burden, while the individual situation is often interpreted as relief. Two mechanisms can contribute to this. In the first case, relief is felt because one sees that at least the others fare even worse. A second mechanism has to do with the perception of control, that is, for example, the sense of still having ‘control over’ one’s own life” (Heitmeyer 2010a: 28). From this we also draw the conclusion that what a crisis is and when it takes place requires explanation and substantiation.

    Increasing lack of transparency

    Second finding: The specific character of a crisis process determined by the financial markets is of decisive importance. In our interviews and group discussions the world of the financial markets appears as a virtual world in which “fictitious money … is shoved back and forth” and which is far removed from the world of actual production in the factory, in which “real value” is created:

    “Obligations, CDEs or CDAs, or whatever those things are called, that is just coloured paper. If I set a match to it, it would be gone.”

    At the same time, the “fictitious” economy is increasingly taking possession of the real one: be it by immediate credit dependency via loans (in the crisis called credit crunch) or by company management oriented towards shareholder value:

    “That only by speculation, by fictitious things you can ruin a healthy company … there have been years when Siemens earned more through speculation than through production. Porsche … they have made more profit from the sales volume. That’s completely insane. Only through speculation.”

    The companies’ dependence on the markets und on profit parameters, which correspond to the recovery rates of financial capital, are an expression of the reversal of the relationship between real and financial capital accumulation in a capitalism driven by the financial markets. 

    Thus we have arrived at a crucial point: the normal mystification of the capitalist mode of production is even heightened in the world of financial capital accumulation2. The questions concerning the nature, time and origins of a crisis appear – in a time in which economic life is determined by the financial markets – to be even more mysterious than in the case of cyclical crises. Thus other, more encrypted, structures can be found at the root of the present-day consciousness of the crisis than in the case of the great crises of over-accumulation in the 1970s and 80s.

    If the real economy is determined by a “fictitious” economy it becomes difficult for the jobholders to discern real possibilities of action. The crisis detaches itself from the immediate surroundings, does not show itself in overflowing warehouses but as a sequence of failed financial-market deals and resulting restrictions for the companies. The financial markets do not only lie beyond the world of our interview partners and the great majority of the population’s experience; they are quasi extraterritorial spaces, at least not spaces where one could intervene with classic forms of resistance. In companies, the workforce – if well-organised – has room for manoeuvre to impose sanctions which can go so far as to veto a management decision; but they cannot intervene in financial markets. Thus, to the questions of “what” a crisis is and “when” it occurs, we have to add those of “where” it occurs and “against whom”.

    The Current crisis merges with previous experiences of crises

    Third finding: the question as to why a “crisis of the century” has up to now been almost unreflected on Germany’s social and political stage is conventionally explained by the crisis being perceived as a unique and singular event. However, our survey arrives at different findings: For some of the employees the crisis has been there “all the time”, it appears to them as something of a “permanent process”. This sounds paradoxical, even absurd in economic terms, because a crisis is only a temporary phase in the industrial cycle, in which the devaluation of surplus capital creates the basis for new capital investments and thus for a new boom.

    In our colleagues’ report the crisis is understood as something different from a crisis in the strictly economic sense. Rather, the persistent pressure and the permanent insecurity regarding employment, income and working conditions are understood as “expressions of the crisis”. The permanent restructuring of the processes taking place in the workplace is understood as a “crisis”: this refers to relocations, outsourcing and programmes aiming at the reduction of costs, increasing work intensity, etc. In coping with this permanent restructuring, “reactions to the crisis” take on a certain routine character.

    The crisis falls on the sceptical soil of long experience of deterioration of working and living conditions. In the workplaces, people’s current experiences of the crisis merge with developments that were always experienced as crisis-ridden. More than that: defensive experiences including social and political defeats are embedded in the perception of the “crisis as a permanent process”. It had not been possible to prevent either the growing pressure for efficiency, nor the deterioration of working conditions and the lengthening of working time in the context of a progressive marketisation of relations within the companies or the extremely one-sided distribution of the newly produced wealth in favour of incomes from capital and assets.

    “What do you want to do? You cannot do anything anyway. The rules of the game are fixed … the tune is set elsewhere. And we can only live with the fallout. This is simply the way things are.”

    The high price of the “German Miracle” 

    At times this goes even deeper. The experiences are seen as “debasement” of work. The connection between work and human dignity has been forced onto the stage. This has also to do with the meritocratic outlook: “the effort is worth the trouble”. A part of the workforce is calling into question this central capitalist legitimation resource – but in the context of defensive experiences and memories of defeats.

    Fourth finding: The concept of the “German miracle” – i.e. securing the jobs of the core of the workforce despite a dramatic reduction of production – contains both a positive and a negative message. The positive one is: employment can be secured by a massive reduction of working time. This was brought about not only by “short-time work” – which also became famous in other European countries – implemented with the help of the labour-market agency and the state. From the perspective of quantity, the reduction of working hours using the instrument of working-time accounts was more important. In these accounts a considerable amount of overtime quotas had been “saved up” in the years preceding the crisis – in particular this was the case in the metal processing industries, where collective agreements have established a 35-hour-working-week but where the 40-hour-working-week had become the normal working time again (Lehndorff 2010). In the crisis these work-time bonuses were not only reduced but in many cases the positive account balances were converted into negative ones or even “debts” – of up to 300 minus hours, in individual cases even much more than that. To give an idea of the dimensions involved: 300 working hours are about 8.5 working weeks.

    The negative messages

    Job security does not apply to all the areas of precarious work. As we could glean from the statements of the union workplace representatives and the shop stewards interviewed by us, the “workforce buffer of labour leasing” has functioned, i.e. for the companies and also for the members of the core of the workforce who have not criticised this. For the companies this also holds true for the times after the crisis. Their personnel policy is characterised not by new employment but by resorting to leased workers. Within one year, leased work has risen to new all-time highs. The companies have acquired new experience with the instrument of external flexibilisation, which comprises leased labour, short-term work contracts and pseudo self-employment.

    The accumulating and dismantling of work-time accounts was based on a subordination of private needs to the demands of the workplaces. This instrument of internal flexibilisation was in most cases uncomplainingly accepted – even after losses of income – by a workforce disciplined by the crisis. If Germany before the outbreak of the crisis had been one of the countries – if not the country – with the most flexible work-time regime, its companies learned in 2009/2010 that the leeway for flexibilisation is yet greater.

    In the interplay between short-time work and quick job processing, the pressure toward efficiency and saving time increased even further. Thus the crisis also offered a field for experimentation with even further intensification of work, despite the prolonged working hours that resulted in the end. If a health-policy time bomb had already been ticking before the crisis, now the time required before its explosion will be even shorter (Pickshaus / Urban 201).

    Flexible use of the workforce leads to job insecurity and loss of status. In particular, in larger companies skilled workers were relocated from indirect domains to direct production, which not only gave rise to fears of deskilling but was also accompanied by the experience of deteriorated working conditions (for example, on the assembly line). The people we asked have begrudgingly accepted this but only as a temporary measure. An instrumental understanding of work did not arise from the crisis, and the topic of “good work” has by no means been done away with.

    The companies have been strengthened. The crisis was a period for rehearsing what the further path to rationalisation of “downsized organisation” might look like. If the companies see in a crisis everything is functioning even with a reduced workforce, they will decide not to increase resources when the next boom comes.

    On the other hand, the instruments of extreme flexibilisation (of employment, of working hours and work intensity) which have served in times of the crisis will find further application. “Flexible business” has taken a further step: the “breathing factory” with capacity-oriented, variable working hours has become more clearly discernible in its outlines after the ultra-flexibilisation was intensified in the crisis. Whether a “flexible human” can be created at the end of this development is questionable.

    Impotence and “anger without an addressee”

    Fifth finding: the appearance of a “crisis without a conflict” is not unfounded. Wide-ranging social conflicts have so far been absent from the acute course of the crisis. But behind the façade experiences of impotence in the face of a distant, uncontrolled dynamic show themselves: “… the tune is set elsewhere. And we have no choice but to live with the echo.”

    At the same time, a considerable but rather diffuse protest potential becomes visible. In our interviews and discussions, discontent was expressed, in many cases combined with little hope of improvement in the near future. Still, this anger does not suggest either apathy or fatalism. It is discontent coupled with insight into the situation, a wish to change it and perplexity as to how a change could be effected.

    The anger has long been present, already before the crisis, and it has become pent up. But in most cases it does not have a concrete addressee and if it does, the addressees seem to be out of reach. To most of those we asked, the ones “responsible” – those who caused the crisis – cannot be found in the company itself. In particular, in dependent supplying firms the local management is experienced as powerless, but also the “economically powerful” are regarded less as independent protagonists but rather as small fish in the system.

    However, this does not indicate a lack of distance from the employer and the complex of domination within companies; indeed, the conflict of interests is also perceived at the level of the company itself and not only in the overall social level. The concessions to the company are made with gritted teeth instead of a sense of sitting in the same boat with the local management.

    “Yes, people are grinding their teeth … they are no longer willing to let everything happen to them. It is very emotional. … This won’t work much longer, then it will become more aggressive. Then the aggression will come to the surface and then there’s no telling what will happen …”

    Against this background, “crisis corporatism” inside the companies is at best a temporary deal on a slippery slope. It is mixed up with many elements: resignation, exhaustion, social anxieties, but also anger and protest. It does not mean the permanent relinquishing of claims and the absence of criticism. Our finding is that the formula of a “crisis without conflict” misinterprets the mood in a way much too based on the media’s superficial account. What we observe is something different: anger, anxiety and powerlessness.

    The experience of powerlessness of an “anger without an addressee” is shifted from the workplace to “society” and to “state and politics”. This anger is spreading in a relatively diffuse way and leads to distinct fantasies of resistance and protest. In our survey France is often considered a positive example. With visible protest action from burning tires in the streets to demonstrations in front of government buildings to “boss-knapping”, people there seem to succeed in getting at least public attention focused on their woes and demands.

    “And since we are close to the French border and thus possibly French in our mentality, it could happen that one day lorry tires will be burning in front of doors here.”

    “But if it goes on like that, then people are going to organise one day and then there will be a real clash. And I doubt this will happen peacefully. Because meanwhile so much has been pent up that I must say they could probably react to something that is not really relevant … This is slowly building up and then it will explode, but it will be a tremendous explosion.”

    Some of those interviewed have learned to deal with the crisis conditions in their workplaces. In some enterprises that are permanently threatened by relocation, both the workforce and their representatives have learned to confront the permanent blackmailing with acts of resistance. From such struggles the employees and workers are accumulating a sense of their power to act.

    “In my workplace, people have the feeling that we’re not going to keep letting people do anything they want with us, that we’re finished making concessions. We say, this far and no further. We have had it! It doesn’t make sense to concede anything more, because when we concede, it all goes to profits and the returns of the capitalists and employers; the way I see it also goes into the politicians’ pockets. So, with us, I have the feeling that we’ve reached a point where we are saying: this far but no further.”

    However, the experienced power to act will continually be limited by structural conditions (for instance, of suppliers to focal enterprises). These are defensive struggles, not offensive conflicts on the basis of alternatives formulated by the people themselves.

    Trade unions “have to become more political”

    Sixth finding: Besides the examples of successful resistance and the experienced power to act, people taking part in our survey repeatedly referred to those conditions which basically hamper political activities. Among those there are – besides existential anxieties and aggravated working conditions – tendencies to divide the workforce: into core and outsourced workers, workers in production and employees, workers of different nationalities and cultures, etc. Last but not least, these represent barriers to collective orientation and possibilities to act in solidarity. This also affects the possibilities for trade unions to mobilise and assert the interests of the workforce. While the fundamental significance of trade unions to represent the interests of the workforce is undisputed, in times of crisis their role is not perceived only as positive.

    The interviewees widely feel that the unions are successfully managing the crisis, but do not think that the unions have fulfilled their mission as educational institutions able to interpret the current crisis situation. They have shed too little light on the crisis – led too few discussions with the shop stewards and union workplace representatives about the suddenly changed situation and were insufficiently present in carrying out this mission in the workplaces. In the face of the media’s dominance in everyday consciousness, there is no perception of the unions’ own interpretation of the crisis.

    Besides more education and interpretation, taking a firm political stance and increasing mobilising efforts are further critical demands addressed to the trade unions by those they represent:

    “… The trade unions have to become more political, in any case, more political and more radical. So that we gain more authority again and can stand up to people like Westerwelle and Merkel.”

    However, despite all the criticism of trade unions, the basic tenor is one of solidarity:

    “The trade unions are the only people we still have got here. Because there is nobody else we can count on in this country any more. When it comes to opposing politics and the employers’ dominance, all that we have is the trade unions.”

    “Forget about politicians”

    Seventh finding: In contrast to unions, the state and politics come across poorly. It is on them that the “anger without an addressee” is displaced. Politicians are corrupt and the state generally impotent – that, in abbreviated fashion, is the conclusion. To be sure, hope is still placed in the state, for example if it is a question of regulating the financial markets, but the basic tenor remains sceptical and resigned. Also for the future negative developments are expected: these comprise further dismantling of the welfare state, further consequences of the crisis which again the “people in the trenches” will have to bear. Politicians are said largely to have detached themselves from the world of experience of the employed and workers.

    “Politicians do not turn their faces towards the people … It is all so corrupt, money has got such power … And as long as they have the money, nothing is going to change. I don’t see change coming.”

    To put it more sharply, this finding means that the awareness of the crisis and (political) societal consciousness are closer to each other than perhaps was the case in previous periods – but in a way that does not see politics as a potential problem solver; rather it is seen as a part of the problem. This reinforces both, the anger and powerlessness.

    Between powerlessness, anger and hope

    The crisis does not only fall on the sceptical soil of long experience of deterioration of working and living conditions but it also meets with far-reaching processes of delegitimation of the economic and political power relations and their institutions. The crisis is perceived as an affirmation of a criticism which has been maturing for many years. The system’s promise that a high degree of readiness to perform will be rewarded with recognition, advancement and security, has exploded. We are dealing with a high degree of delegitimation of an economic system which has not kept its promises of well-being.

    It is precisely in the crisis that the daily constraints and coercion of the system work against criticism of the system. This leads to a feeling of people’s powerlessness (not of fatalism) and to their anger, anger that “it’s still going further downhill” and that they are “being fooled again and again”.

    However, the hope remains of cracking open the status quo, cemented by the system’s logic and constraints, and creating space for new ideas and images of change in order to overcome the feeling of powerlessness. However, the questions still unsolved are: What are the entry points? Who is the addressee? Where are the points of intervention and the cracks?

    There are hopes that

    • the protest will become visible and will spark fires;
    • there will be a common point that will put an end to retreat;
    • one day there will be “a tremendous explosion”. 

     

    Notes

    1. Richard Detje / Wolfgang Menz / Sarah Nies / Dieter Sauer: Krise ohne Konflikt? Interessen und Handlungsorientierungen in der Krise – die Sicht von Betroffenen. [Crisis without Conflict: Interests and Orientations towards Action in Times of the Crisis – the Perspectives of Those Affected]. Hamburg 2011. The study was subsidised by the Rosa Luxemburg Foundation and the Wolfgang Abendroth Foundation. The quotes are taken from the interviews and group discussions taking place in the context of this study. 
    2. In interest-bearing capital, this “automatic fetish, self-expanding value, money generating money is brought out in its pure state and in this form it no longer bears the birth-marks of its origin. The social relation is consummated in the relation of a thing (of money, of a commodity) to itself.” (Marx, 1861-63: 447) 

    Literature

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    Bischoff, Joachim/Detje, Richard/Lieber, Christoph/Müller, Bernhard/Siebecke, Gerd (2010): Die Große Krise. Finanzmarktcrash – verfestigte Unterklasse – Alltagsbewusstsein – Solidarische Ökonomie. Hamburg. [The Big Crisis. Financial Market Crash – Consolidated Underclass – Everyday Consciousness – Economy of Solidarity]

    Heitmeyer, Wilhelm (Hrsg.) (2010): Deutsche Zustände. Folge 8. Frankfurt a.M. [German Conditions]

    Lehndorff, Steffen (2010): Arbeitszeitpolitik nach der Kurzarbeit [Working Hours Policy after Short-Time Work], in: Schwitzer, Helga/Ohl, Kay/Rohnert, Richard/Wagner, Hilde (Hrsg.): Zeit, dass wir das drehen! Perspektiven der Arbeitszeit- und Leistungspolitik. Hamburg, S. 39-62. [It’s Time That We Turn Things Around! Perspectives of Working Hours and Performance Policies]

    Marx, Karl (1861-63): Theorien über den Mehrwert, Dritter Teil, MEW 26.3, Berlin. [Theories of Surplus Value]

    Offe, Claus (2010): »Keine Aussicht auf eine Repolitisierung in Zeiten der Krise«, Claus Offe im Gespräch mit Gunter Hofmann und Wilhelm Heitmeyer, in: Heitmeyer, Wilhelm (Hrsg.): Deutsche Zustände, Folge 8. Berlin, S. 283-295. [No Prospects of Re-Politicisation in Times of Crisis. Claus Offe, in Conversation with Gunter Hofmann and Wilhelm Heitmeyer. In: German Conditions]

    Pickshaus, Klaus/Urban, Hans-Jürgen (2011): Das Nach-Krisen-Szenario: Beschäftigungspolitische Entspannung und arbeitspolitische Problemzuspitzung? [The Post-Crisis Scenario: Détente in Employment Policy and Problem Escalation in Labour Policy?] In: Schröder, Lothar/Urban, Hans-Jürgen (Hrsg.): Gute Arbeit 2011. Handlungsfelder für Betriebe, Politik und Gewerkschaften. Frankfurt a.M. [Good Work 2011. Scope for Action for Enterprises, Politics and Trade Unions]


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