IMPROVEMENT in the means of communication has made it possible to transfer some office jobs from the First World to the Third World. George Monbiot of ‘The Guardian’ in one of his recent articles (Dawn, Oct. 23, 2003) looks upon this transfer, specially that of the upper-grade jobs, as a restitution of what Britain had taken away from India earlier and calls upon those “concerned about global justice and the distribution of wealth around the world” to rejoice.
However, Ashfak Bokhari in his article titled “The massive global job shift” (Dawn, EBR, Nov. 10, 03) regards it as a stage in the continuing process of globalization, the previous ones having been those of the export of manufacturing and the import of the highly qualified manpower by the advanced countries. But, crucially, he places these developments in the context of class struggle in the advanced countries. He says: “Can the bureaucracies in the US and Europe reconcile with the coming great loss of jobs to its workforce—?

Economy is about the production, distribution and re-distribution of value, which is created by the application of human labour to matter to make it useful. The instruments of production, from the screwdriver to the most sophisticated machines, only spread this labour over a greater number of products. In doing so, they transfer their own value to the product but do not create new value. Only the human labour does that.

The unproductive or auxiliary workers, who work in the offices, shops, banks or in scientific research, etc., do not create value either. They, like the capitalists, live off the value created by the productive workers, those who create useful goods. Some of them, e.g. executives, engineers, may be well-paid but remain what Marx called “the high-paid menials of capital”. In capitalism, only the capital has reason in the Kantian sense. Actually a distinct corps of auxiliary, non-productive workers, high-paid and low-paid, is the product of the separation of physical from mental work and the alienation of the productive worker, the creator of wealth, from the means of production, the productive process and the product of his labour.

In the struggle between the worker and the capital over the value created by the former, the capitalist finds the existence of a permanent body of unemployed workers — the industrial reserve army — essential. Their very availability as replacements for the employed workers and their willingness to work at lower wages exert a downward pressure upon the wages. However, the situation in the advanced capitalist countries was modified after the Second World War, when the communist threat appeared to be on the rise. A social security system was put in place for fear that the workers may, otherwise, become radical.

Moreover, the governments accepted that it was their responsibility to keep the rate of unemployment low. Here the capitalist class as a whole, as class-state, overrode the narrow interests of individual capitalists. Anyway, the task was facilitated by the continuous high expenditure on armaments.

This reduced the size of the industrial reserve army in the advanced countries. And its pressure upon the wages was almost nullified by the unemployment insurance.

Since then, as Samir Amin says, the industrial reserve army has been located mainly in the Third World. In spite of the fact that the Third World workers are kept physically out of the advanced countries, they exert an indirect pressure upon the workers of the metropole, thus becoming a factor in the class struggle there, just as the Third World’s resources, products and labour-power are factors in the process of accumulation in the West.

The blockage of the flow of the Third World’s workers into the advanced countries enabled the latter’s workers to keep their wages high But it also kept the wages in the backward countries low, mainly due to the depressed cost of reproduction of the labour-power there, brought about by the colonial system. This contradiction between the workers of the two worlds gave an opening to the capital, though there were restraining factors too.

If the western capital could not import cheap labour-power,it could carry the factories to them in the Third World. The large-scale transfer of manufacturing, mainly labour-intensive, to the low-paid workers abroad effectively devalued the productive labour in the advanced countries themselves as: firstly, the increased unemployment exerted downward pressure upon the wages, to the extent that some unions in the US and France agreed to an actual reduction in wages, while the others did not press for a raise.

Secondly, to the extent that the goods produced abroad with cheap labour entered the consumption of the workers in the metropole, the wage fund could be reduced. Lastly, profits could now increase both because of lowering or stalling of wages and of the lowering of the cost of production due to the cheaper goods produced abroad entering production as an input.

Once the capitalists had succeeded in brow-beating the industrial workers, the transfer abroad of the lower-grade non-productive jobs had to follow except those jobs which could not be separated from the work-place in the metropole, such as restaurant waiters, engine drivers etc. The important point here is that the transfer of managerial jobs to the Third World is not a qualitative change. It is the logical next step in the process of the devaluation of labour-power in the metropole.

Bokhari feels that, when it comes to the transfer of the higher-paid jobs manned by the middle class, the political problem may sharpen. However, the capitalist society, whose capitalist character is upheld by the middle class itself exists to serve the capital. The latter will have its way, though the resistance may slow down the process of transfer abroad of the upper-grade jobs.

The “high paid menials” may regard themselves as special friends of capital, almost capitalists, since they are given some shares too. But they remain servants of the capital. Even they cannot stand in the way of its reproduction. (Not that they would want to.)

Looked at globally, the western working class, by not solidarising with the workers of the Third World, by, in fact, supporting the metropole’s capital against them, weakened its own defences. As a result, today, the industrial reserve army, confined to the Third World, turns into black legs for the workers of the metropole.

Monbiot is, however, wrong in thinking that the transfer of these high-paid auxiliary workers’ jobs to India would affect the nature of the relationship between the advanced and the backward worlds. It is not so. If the job of an executive earning $100,000 in England is now done in India by someone who used to earn $5000 but will now receive $10,000 for it, it means that India will surrender $90,000 to England.

The main point in the relationship is that the metropole keeps the most advanced industry with itself. Monbiot says “Britain’s industrialization was secured by destroying the manufacturing capacity of India.” That is true. The common people of India used to say that the British had cut off the thumbs of the Muslin weavers of Dhaka. That was not correct. But it was the succinct way in which the masses conceptualized the de-industrialization of their country.

The simple fact is that the destruction of India’s textile industry, restricting the subcontinent to the production of raw cotton, was the only means of creating a difference between the technological stages of the two countries. Raw material production in one and light machine industry in the other gave way later to light industry versus heavy, basic industry.

When the Third World acquires the basic industry, the metropole moves into electronics and knowledge-based industry. Neither side is static. But the qualitative difference between them is maintained to enable the advanced world to practice unequal exchange with the backward one.

The driving force behind these developments is the struggle within the metropole. As the organic composition of capital, i.e, the ratio of machines per worker, increases there, relatively fewer workers are employed, yielding less relative surplus. Consequently, while the volume of products increases and each contains more complex labour, the rate of profit has a tendency to decline. The capital has historically countered this tendency by reducing the cost of reproduction of the labour-power thus devaluing it.

One of the means of doing so has been to obtain cheaper food and raw materials and, now increasingly, the products of light and some heavy industries from the Third World. In the latter, the ratio of the tools per worker being lower, the worker yields a proportionately higher per capita surplus.

This can be transferred to the metropole through unequal exchange, as long as the cost of reproduction of the labour-power in the Third World is below that in the First.

Thus the Third World has, from the sixteenth century on, been a crucial element in the struggle within the metropole. The latest tendency of the devaluation of labour-power in the metropole by transferring jobs to the backward countries is only a new aspect of the same relationship.