South Korean workers face off against the new, liberal regime

By Mark Detroit, Communist Voice, #18, 1 August 1998, rev. 17 October 2001

The capitalist crisis in Asia has taken a heavy toll on the working masses. South Korea was one of the tigers of the so-called Asian miracle. But here too the explosive growth of capitalism has brought crisis and misery in its wake. During the last several months, the workers have launched a series of strikes and protests in order to defend their conditions in the midst of the crisis. A central issue has been mass layoffs and new laws that the government has rammed through which do away with certain restrictions against layoffs that used to give some protection to a section of the workforce. Worker actions have escalated somewhat in mid-July with about 100,000 workers walking off the job for two days in protest of the general wave of job cuts and some 26,000 Hyundai workers launching an intense struggle against that company’s plan to lay off thousands of its employees.

The KCTU, the more militant of the two main trade union federations has called most of the strikes and protests. But the KCTU leadership also seeks to reconcile with the new democratic regime of Kim Dae Jung which is leading the austerity onslaught against the masses. Kim Dae Jung has granted the KCTU leaders some more legal rights for the union, and in return, the union officials have put their faith in empty government promises that were allegedly going to restrict massive job elimination. Time and again, the KCTU leaders have canceled major actions for the sake of vague government promises and they have proposed their own version of austerity measures as the only viable alternative for the workers. But while the KCTU leaders still dream of class reconciliation, the attacks on the workers have come at such a furious pace that by July the KCTU leadership felt it necessary to call for a new round of strikes and demonstrations.

Kim Dae Jung, like his predecessor Kim Young Sam, was part of the bourgeois opposition to the military dictatorships that ruled South Korea for about three decades up until the end of the 1980s. The mighty workers’ struggle at the end of the 1980s brought the dictatorship down. But the dictatorship was not thoroughly demolished, but followed by a compromise between the bourgeois liberals and the old-guard tyrants. This has meant that whatever democratization has taken place has been slow and painful and much of the old-style repression lingers on. Whenever the workers’ movement has risen up, the new democratic government has not hesitated to use brutal force and round up the union officials. Trade unions rights remain in imminent jeopardy unless the union supports government policy. Heavy-handed persecution of the radical left remains. Nevertheless, there has been a certain evolution. For example, elections have been held and bourgeois political parties have more leeway.

Kim Dae Jung’s government is the most liberal of the civilian bourgeois regimes that has come to power since the dictatorship fell. But though Kim has furthered the process of partial democratization, this has gone hand-in-hand with his forcing the masses to sacrifice to save the profits of the South Korean and foreign capitalists. Thus Kim has continued the onslaught of anti-worker laws started by the out-going president Kim Young Sam and signed on to the $58 billion IMF bail-out package replete with austerity measures for the masses. Kim’s reputation as an opponent of the military dictatorship, however, has given him more credibility in the eyes of the masses than most bourgeois politicians, and his democratic reputation has to some extent dampened down the resistance to his assault on the living conditions of the masses.

In particular, Kim Dae Jung’s new policy of trying to co-opt the KCTU has had its effect. The unions that formed the KCTU federation arose in the late 1980s in the midst of the militant workers’ upsurge of that period. These unions were independent of the government, which backed the reactionary FKTU federation, and they waged a number of battles against the employers and in defiance of government repression. The workers desire for independent unions led to the KCTU’s ranks swelling to 500,000 members despite its illegal nature, thus representing a serious challenge to the 1.2 million member FKTU. But Kim Dae Jung has offered more legal rights to the KCTU in return for the KCTU keeping the lid on the workers as they are hammered by layoffs and austerity. The KCTU leadership has been unable to resist the offer, and the result has been that KCTU leaders are calling on workers to share the pain of the crisis and have scuttled plans for a general strike several times in recent months.

Capitalist crisis lashes the workers and poor

The economic slump that has hit South Korea has been ruinous to the workers. The economic crisis is not merely a financial crisis. Nor was it caused simply because there were some shady loan practices and corruption. The economic devastation in South Korea is part of a crisis of overproduction that has hit most of Asia and whose roots are in the very nature of capitalist production itself. Productive capacity has outstripped what the home and world markets can absorb and so production is being cut back.

As a result, companies are downsizing at break-neck speed. Many small companies have collapsed, and a number of big enterprises are similarly threatened. For instance, recently the country’s Financial Supervisory Board declared 55 companies, including 20 subsidiaries of the giant chaebol monopolies, non-viable, and has ordered banks to stop making loans to them, presumably to let them collapse or be brought up by foreign investors. Recently it was announced that the giant Kia Motors company is being auctioned off. The Korean finance sector has gone into crisis because companies can’t pay back the massive debt they have accumulated.There are an estimated $85 billion in problem loans at present. Letting certain firms die or be brought up cheap by foreign capital is one of the main demands of the IMF bail-out plan. Also in line with these plans, the government announced it would sell $12-13 billion in assets of big state-run enterprises (steel, electric and gas power, banking, etc.) to foreign investors.

All told, Bank of Korea officials predict that in 1998 the South Korean economy will contract by four percent while other sources predict as much as an eight percent contraction. Nor does it appear that an upturn is just around the corner. Indeed, the recession in Japan, a huge trading partner with South Korea, threatens to make the crisis deeper. Official government unemployment statistics, which greatly undercount the unemployed, have gone from about 2.5% before the crisis to 6.7% now. By the end of this year, a Bank of Korea spokesperson estimates unemployment will rise to nearly 9%.

Alongside the massive growth in unemployment, the cost of basic necessities has doubled in the last year. The price hikes have a lot to do with the deep plunge in the foreign exchange rate of the South Korean currency, the won. Meanwhile, corporations are trying to shove wage-cuts down the workers throats.

Making matters worse, government safety net programs are completely inadequate. In the mid-90s the first unemployment benefits program was established. But it does not cover about half the workforce that is employed by firms with less than 30 employees. As well, the amount of benefits a laid-off worker receives is only about 60% of the official poverty-level for a family with two children.

Kim Dae Jung: the liberal face of South Korean capitalism

At the head of the efforts to saddle the workers with the burden of the crisis is new president, Kim Dae Jung. Although Kim had been hounded and jailed by the military dictatorships that had ruled South Korea until the end of the 1980s, he did not represent a radical trend of the masses.Rather, he is an ardent defender of capitalism, and has already shown a willingness to keep the workers down by brute force if need be. He has called in riot police to put down worker actions.At the end of this May’s strike wave, he issued summonses for 143 KCTU officials for the purposes of interrogating them. He has declared this July’s strikes illegal and begun arresting union leaders.

But Kim Dae Jung supplements repression with a policy of trying to co-opt the KCTU trade unions which have led the more militant worker actions and, until recently anyway, had only been allowed a semi-legal existence. This represents a bit of a shift from Kim Dae Jung’s predecessor. Kim Young Sam’s regime balked at recognizing the KCTU. It went so far as to hold a secret session of parliament with no opposition parties present to make sure that labor legislation permitting more layoffs being considered in parliament would not include extending legal rights to the KCTU. A massive strike wave involving 750,000 workers broke out against the Kim Young Sam law, however, and this has helped convince much of the ruling class of the need for the carrot-and-stick methods of Kim Dae Jung.

Though Kim Dae Jung tries to look more reasonable toward the workers, there’s no doubt where his loyalties lie. He quickly jumped on board the bandwagon of IMF austerity measures and makes no secret of his desire to do everything he can to encourage a new influx of foreign capital. Not only does this mean shoving the workers down, it also involves opening up new sectors of the South Korean economy to international capital and privatizing part of the state economic sector. Meanwhile, according to the Business Week of January 8, 1998, Kim has stocked his economic policy team with advisors from the military dictatorships of Park Chung Hee and Chun Doo Hwan. So while Kim wants to carry out some reforms of the chaebolmonopolies, he by no means intends to harm the interests of big capital in South Korea.The new president also has reconciled with the former heads of the military dictatorships by releasing from jail the corrupt and brutal former presidents Chun Doo Hwan and Roh Tae Woo, who were serving long sentences for their crimes in office. This disgusting spectacle no doubt was calculated to prove to any doubters, Kim Dae Jung’s loyalty to the bourgeois establishment. Indeed, Kim Dae Jung appointed as acting prime minister none other than Kim Jong Pil, founder of the notorious secret police, the Korean CIA. Kim Jong Pil also was prime minister in 1972 when among those targeted for death by the KCIA was Kim Dae Jung himself!

Strikes and protests called . . .

Though the level of struggle is down somewhat from the upsurge during the reign of Kim Dae Jung’s predecessor, Kim Young Sam, the economic crisis and anti-worker measures have been the impetus for a number of important worker actions over the last several months. Kia Motors workers launched a fight against 50% wage cuts and failure to pay wages. In April the workers went on strike. 3,000 of them marched on a government complex where there were clashes with police. The strike actions continued through June, eventually forcing the company to announce a complete shutdown. By this time, 14,000 Kia workers were out. In mid-June a settlement was reached, but unfortunately it appears that the workers did not fare well. They only got half of the back pay owed to them. Since then, the question of what will be the fate of the workers now that Kia Motors is being put up for sale has come up.

On international workers’ day, May 1, tens of thousands of workers marched and rallied. 18,000 rallied in the capitol, Seoul. The frightened government of Kim Dae Jung mobilized 13,000 riot police to deal with the demonstration. Battles between angry protesters and cops broke out.

At the end of May, the KCTU unions organized strikes and walkouts around the country to protest layoffs. All told, some 120,000 workers participated including tens of thousands of Hyundai workers who brought plants in the city of Ulsan to a halt. Workers demanded and end to layoffs, a scrapping of IMF austerity measures and improvements in unemployment compensation and other social benefits.

Another wave of protest broke out in July as the layoffs and wage cuts continued to pound the workers. The groundswell of anger among the workers was such that even the conservative FKTU pledged support for these actions. A rally of tens of thousands of workers was jointly organized by the FKTU and the KCTU on July 12. About 100,000 workers in KCTU unions went out on strike on July 14-15. This included workers in heavy industry which is being targeted for heavy downsizing and privatization. Employees in the financial sector are also being hammered by layoffs, but both the KCTU and FKTU unions in this sector balked at joining the scheduled three-day strike. At the same time, 26,000 Hyundai workers also launched their own brief strike to protest the company’s plans to cut over 9,000 jobs. This was one of a series of temporary work stoppages by the Hyundai workers in the preceding weeks. As we go to press, the struggle of the Hyundai workers is intensifying. Workers occupied a plant in Ulsan city, forcing the company to shut the plant. At a plant in Chonju city, workers attacked company officials and smashed office equipment. A rally of 500 Hyundai workers raised the slogan Oust the Kim Dae-Jung government, which kills workers and the public.

In response to the mid-July actions, the democratic Kim Dae Jung government issued warrants for the arrest of KCTU leaders and sent hundreds of riot police to surround the offices of the metal workers’ affiliate of the KCTU. The KCTU reported that Kim’s regime also has rounded up 16 trade union activists in Ulsan under the pretext that they have discovered that these activists supposedly belong to an illegal underground organization called the Anti-Imperialist Youth League. The KCTU stated that the regime plans to accuse the activists of violating the National Security Law, a favorite tactic of repression employed by the dictatorships of past years.

In turn, the KCTU threatened to extend the strikes unless the government crackdown ended. At the same time, the deputy secretary general of the KCTU’s metal workers’ union held out an olive branch to the regime stating we never opposed the restructuring itself and agree restructuring is necessary to make our economy healthier. But the government should discuss with labor in advance and also speed up chaebol restructuring.

Thus the KCTU leaders have announced that they will cooperate with austerity measures provided they have a role in how they are carried out. For example, the KCTU leaders are offering their own concessions to Hyundai as an alternative to the company’s plans. Union leaders have proposed a system of rotating layoffs combined with wage cuts.

. . .Strikes and protests sabotaged

Moreover, at the last minute the KCTU called off a planned general strike scheduled for July 23 because the government made general statements promising to look into what could be done about some of the layoff plans. Thus, while the KCTU called a new round of actions in July, they have shown a willingness to sacrifice the workers’ struggle for the sake of reaching agreements with the Kim Dae Jung regime.

In similar fashion, the large actions at the end of May were building up the workers’ momentum and the KCTU promised to call a general strike against the austerity measures, and the laws facilitating layoffs in particular. But the KCTU leadership betrayed the struggle. On June 5 they announced a sell-out deal with the government. In the reports on the deal, there is nothing about repealing the laws allowing more layoffs to say nothing of helping those who never had any legal protection. It should be pointed out that even prior to the new layoff laws, 45% of the employees hired by companies are hired only on a temporary basis, be it for a day or a year. These workers will remain without job security even should the new pro-layoff laws be repealed. In return for calling off the general strike, the union basically got a lot of promises from the government to discuss various problems with the union without any serious commitment to ease the workers plight.

Cooling off the struggle in return for empty promises has become a pattern for the KCTU hierarchy. In early February, the KCTU leadership then in power agreed to new laws extending the ability of companies to carry out massive layoffs. But the revisions of the labor laws was accompanied by phony promises that the employers should try not to axe their workforce. Thus, the agreement states that:

1. Layoffs will be allowed should there be an urgent need by business, or when mergers and acquisitions of businesses take place.
2. Employers must make every effort to avoid layoffs.
3. Employers must select those to be dismissed based on a fair standard. Sexual discrimination in dismissals is banned.
4. Employers must notify workers of their dismissal plans 60 days in advance.
5. Employers must make efforts to re-employ laid off workers.(1)

Of course, in the midst of the economic crisis, it will be very easy for companies to claim that layoffs are urgent. And the agreement specifically allows for layoffs for the many cases of mergers and buying up of weaker companies that is going on. Given that, all the rest of the talk about trying to avoid layoffs and carrying them out fairly is a farce. Thus, with the empty restrictions on layoffs, thousands of employees a day have been losing their jobs. Here and there, the capitalist government might find that some company went too far or violated some technicality of law. But for each such rare exception, massive corporate downsizings will be the rule.

In return for betraying the workers, the KCTU leadership was given more rights to organize and participate in political activity. But the February betrayal so enraged the workers that a special KCTU meeting was held and the leadership which accepted this sellout was voted out in favor of new, supposedly more militant officials. The new officials pledged an immediate general strike to overturn the agreement. A few days later, however, the new leadership backed down. Kim Dae Jung threatened to crush the strike and the KCTU officials were unwilling to confront the regime.But it was not just the threat of repression that caused the KCTU leaders to call off the struggle.They joined the employers and the government in fretting about how the strikes would cause serious problems to the economy.

The new KCTU leaders have continued to complain about illegal layoffs and made it the centerpiece of the July protests. But what constitutes illegal layoffs? There are the impotent restrictions contained in the February sellout agreement of the deposed KCTU officials which have done next to nothing to halt the rising tide of unemployment. While the new KCTU leaders condemned the February agreement, they also are preaching faith in it. By continuing to argue that the issue is mainly illegal layoffs, the KCTU is continuing to accept the framework of the February betrayal whose only really meaningful provisions actually made it a good deal easier to lay off workers.

More on the KCTU’s collaborationist approach

The KCTU leaders’ decisions to call off the struggle at key times flows from their basic outlook.While they have had some militant battles with the employers and the government, they seek to reach an accommodation with them. They want certain reforms for the workers but also are concerned about the profits of the capitalists. For example, the KCTU calls for increases in the minimum wage, but then assures the capitalists that the trade union movement undertakes to restrain from excessive wage increase and to improve productivity.(2)

Their objection to the onslaught against the workers is that the employers must also share the pain. Thus, while the capitalists must be allowed to bleed the workers further, supposedly this will somehow be compatible with the business owners suffering.

An example of this class collaborationist outlook of the KCTU leadership is their penchant for tripartite bodies. These bodies are made up of representatives of the unions (FKTU and KCTU), business, and the government. Through these bodies, the workers are supposed to unite with the capitalists and the anti-worker government to pursue their alleged common interests. But the interests of the employers is clearly to drive the workers into the ground to save their profits.Kim Dae Jung has made it clear that the workers must sacrifice for the interests of domestic capital, to attract foreign investment, and to satisfy the IMF. Thus, in reality, the tripartite bodies are simply a means of having the workers’ struggle sidetracked and their demands toned down to what is acceptable to the exploiters. To see what these bodies actually produce, one need look no further than the early February agreement. This was a product of a tripartite body. And it gave the bosses carte blanche to layoff workers while the workers got empty phrases against illegal layoffs that have done nothing to retard the employer onslaught.

By July, the bankruptcy of the tripartite bodies was so evident that not only the KCTU, but also the FKTU, suspended participation in them. Both union federations claimed that the capitalists and the government simply made decisions behind their backs. But they still promote the illusion that things could be otherwise and that such class collaborationist bodies are potentially guardians of the workers’ interests. Indeed, by the end of July, the KCTU had rejoined the tripartite bodies.

The KCTU leaders also tend to echo the general stand of the IMF and the South Korean government on the causes of the economic crisis. For example, the KCTU leaders do not attribute the economic crisis to capitalism, but to distortions, irregularities, and a lack of transparency inherent in the ’chaebol’ dominated system and state-directed financial practices. Indeed, the KCTU states the real causes [of the crisis] have been highlighted by the IMF assessment. And while they voice objections to certain IMF proposals, they conclude that it may be necessary to satisfy the various conditions and requirements of the IMF bailout.(3) In line with this, the KCTU officials propose much the same tinkering with the chaebol system as President Kim and the IMF.

True, the KCTU leadership is upset with various government and IMF measures which increase layoffs. But given the general affinity of the KCTU leadership for the prescriptions for saving South Korean capitalism of the IMF and the Kim government, it is little wonder that they were willing to share the pain for the crisis and subordinate the fight against layoffs to this goal. The basic KCTU stand has been to organize some mass fights while promoting illusions in a reformed capitalism.

Issues facing the workers’ movement

The South Korean workers have a proud history of militant action. They brought down a savage military rule and have established trade unions in defiance of the government. But the workers still face a difficult situation. The great democrat Kim Dae Jung is in charge, but the government still lashes out at the workers. Unions are given official recognition, but their leaderships are rounded up when they don’t get in line with government policies. This torturous democratization process being continued by Kim is tailored to the bourgeoisie and the imperialist multinationals. The workers’ movement must put their own stamp on this process.Over the last decade the struggle of the workers created real gains in their living standards. Now, the workers must offer stiff resistance or face being driven back to the bad old days.

But to accomplish anything, the workers need organization. They flocked into the KCTU seeking to organize themselves for a serious fight. But now they are faced with finding the means to carry on their fight despite the waverings of the KCTU leadership. In order to do this, the workers need to build a trend that does not temper the struggle because of concern for the well-being of the capitalists. They need organization not only independent of the government, but that breaks with the class collaborationist outlook. To the extent that such organization is built, the workers ability to beat back the austerity measures will be increased.

South Korea, like Asia in general, has become a hotbed of capitalist development and a haven for the multinationals and imperialist financiers. South Korea has become an industrial power in its own right. Yesterday, it and other Asian tigers were touted as the models of capitalism. But even yesterday’s models of capitalism cannot avoid savaging the working masses and periodically plunging them towards ruin. South Korean workers have suffered decades of deprivations and harsh working conditions to create the massive wealth of the corporate elite.Now that the capitalists’ own system is nose-diving, South Korean business wants to drive the workers, the urban poor and the small peasants into the ground to extricate their system from crisis. Thus, the present economic crisis has raised the question of what the workers can expect under the capitalist system itself.

While the workers fight for rights and livelihood today, they must begin to think about an alternative to capitalism. No, we are not talking about the revisionist charades that have masqueraded under communist banners in the Soviet Union, China, Cuba or North Korea. The crisis-ridden state-capitalism of North Korea is hardly an alternative for the workers in the South.Nor is nearby China where millions of workers are being laid off under the market capitalist reforms of the phony communist regime. In such countries a new form of state-capitalist oppression developed which has nothing in common with the principles of genuine communism in which society is really in the hands of the working class. To really take up the goal of a future free from capitalism requires anti-revisionist communism.

The day when the South Korean workers rid themselves of the exploiters altogether is not likely to be in the near future. But the struggles of today are not only necessary for the workers’ survival but help the workers learn the lessons of the class struggle. They help the workers see the need for revolutionary organization. Such organization helps the workers learn from their own experience what orientation strengthens their hand today and encourages them toward a real alternative to capitalism, including revisionist state-capitalism. The protracted work to build up such a revolutionary trend is what will put the South Korean workers in a position to completely break the shackles of exploitation.

Notes

(1) February 6, 1998 agreement of the Tripartite Commission consisting of representatives of labor, business, and representatives of the Kim Young Sam government and the incoming government of Kim Dae Jung. (Return to text)

(2) From KCTU proposal for an agreement to overcome the economic crisis, Dec. 15, 1997.(Text)

(3) Quotes in the paragraph are from the KCTU document Unbridled freedom to sack workers is no solution at all released on January 13, 1998 (Text)