Date: Sun, 2 Feb 97 11:18:48 CST
From: (Brian Hauk)
Subject: Labor Battle Shows Failure Of 'S. Korean Miracle'

Labor Battle Shows Failure Of 'S. Korean Miracle'

By Brian Taylor, in the Militant, Vol. 61 no. 6, 10 February 1997

Officials of the Korean Confederation of Trade Unions (KCTU) on January 28 announced an end to the weekly one-day strikes that had been planned to demand the government repeal antiunion legislation passed last December. The union maintains that if the laws, scheduled to go into effect March 1, are not rescinded, however, another general strike will be called.

Some 100,000 workers and youth rallied in Seoul, the south Korean capital, January 26 to show their determination to push back the laws, which grant employers more rights to lay off workers, maintain a ban on the KCTU, and expand the powers of the regime's secret police. The protesters wore headbands reading "collective struggle."

The outpouring by workers in response to the antilabor laws adopted December 26 - including a three-week strike that halted many industries - highlights the failure of the much-touted Korean "economic miracle." It brings home the fact that it is too late in history to transform a semicolonial country into a capitalist world power.

Conflicts between the Seoul regime and the working class in south Korea have exploded almost annually over the last decade. Workers have won substantial economic and political gains, which the Korean rulers now must try to roll back in order to compete with their international rivals.

The history of the Korean peninsula in the second half of this century has been shaped by the U.S.-led imperialist war carried out against the Korean people from 1950-53. U.S. forces leveled much of the country through massive bombings and napalming, especially in the north. They destroying whole neighborhoods deemed "enemy" outposts, obliterated most of Korea's industrial infrastructure, and systematically bombed dikes to destroy crops and cause flooding. At the same time, they suppressed popular uprisings in the southern region that took the shape of general strikes and mass demonstrations. Nearly four years of slaughter left 2 million Koreans dead and 3 million wounded.

U.S. president Harry Truman, together with Washington's puppet, south Korean president Syngman Rhee, set up the 38th parallel as the heavily fortified dividing line across the peninsula after failing in their aim to conquer the entire country. Tens of thousands of U.S. troops remain in south Korea today, with gunships off the coast, their weapons aimed at Pyongyang. This forced division of Korea remains a burning issue for many workers and youth, who want their country reunified.

The rapid industrialization of south Korea began in the 1960s as part of an entire period of post-World War II capitalist expansion in Asia. The 1960 World Almanac described south Korea as a "chiefly agricultural area." U.S. military, financial, and technological aid that year stood at $1.3 billion. A five-year economic plan was launched in 1962 to accelerate the industrialization of the country. By 1966, U.S. funding had reached $2.2 billion. Mining and production of tungsten, coal, iron ore, bismuth, fluorspar, graphite, and cement was picking up, and the timber, rubber, glass, shipbuilding, steel, electronic, and automotive equipment industries were also rapidly expanding. Industrial growth set records year after year over the next decade.

In the 1977 World Almanac, south Korea was described as a "once" chiefly agricultural country. It has been touted as a major success among the so-called developing markets, and is sometimes referred to as one of the "four tigers" of Asia, along with Hong Kong, Singapore, and Taiwan. Just last year, Seoul was admitted to the Organization for Economic Cooperation and Development.

Washington backed a series of repressive regimes in Seoul throughout this period. In 1980, for example, hundreds of student demonstrators protesting a military coup the previous year were massacred at Kwangju.

Labor upsurge wins some gains

A massive strike wave broke out across south Korea in 1988, after decades during which company unions were the only legally recognized labor organizations. Workers demanded higher wages and a shorter workweek. The previous year at least 1,500 new unions were organized, and the number of workers in unions grew to 1.3 million or 22 percent of the workforce. Average pay was $2.30 an hour, which covered only 60 percent of a worker's living expenses. The average workweek was 54 hours - among the longest in the world. Workers also fought for bonus payments, paid vacations, holidays off, and better cafeteria food, among other things.

In response to this wave of protests, the Seoul government placed 71 companies on its "important defense industries" list. By mandate of a law enacted in 1987, workers in such industries were not permitted to strike or even organize unions.

Bosses brought in Kusadae, or Save the Company Corps. These were antiunion hooligans hired by employers to attack and harass workers trying to organize. Workers would be kidnapped by the Kusadae, beaten, and tortured by management to the point of hospitalization. The cops referred to it as an "internal company matter." Police were also sent out to suppress the street actions.

A recurring component of the these confrontations was the fight for reunification of Korea. On July 21, 1990, hundreds of thousands blanketed the streets of Seoul, outraged by a National Assembly meeting held earlier that month that passed 26 bills into law in 30 seconds, with no debate allowed. Included in those bills was legislation that criminalized any nongovernmental relations to individuals or organizations in north Korea. Roh Tae Woo, the president at that time, was later ousted by massive demonstrations and is now in prison, convicted for corruption and his role in the Kwangju massacre.

Out of these fights and many others in the following years, workers wrested a number of concessions from the bosses. Hyundai workers, for example, get a 50 percent discount at the hospital, apartment subsidies, and free schooling for children. Wages have risen 15 percent a year over the past ten years as well. And workers' expectations have also risen. During the recent strikes Chung Jong Soo, an assembly worker at Hyundai Motor, told reporters, "Its true that life is better.- But I don't think we are well off."

Economic stagnation

In today's conditions of world depression and intensified competition, Korea's capitalists must face the limits of the rapid industrialization that took place in a period of world capitalist expansion. Prices for computer memory chips, one of south Korea's best exports, plunged by as much as 70 percent last year. Seoul faces a gap in the overall scope of what it buys and sells. In April 1996, for instance, merchandise exports grew 6.5 percent, while imports rose 14.8 percent. The Far Eastern Economic Review summarized comments of Lee Chan Hong, a spokesman for south Korea-based LG Electronics as, "The Korean home market just isn't big enough for future growth, and has become too expensive for export production." Some Korean companies have begun setting up factories abroad, from Vietnam to Mexico, in search of lower labor costs.

Even though Korean companies fill a third of the world's new ship orders, in the first quarter of 1996 orders decreased by 47 percent in comparison to the previous year. Tokyo's ship-building operations saw a slight gain in the same period. Ships produced in south Korea had been 10-15 percent cheaper than those built in Japan. This price gap has now closed to only 5 percent. Internationally, the industry is facing a crisis of overproduction, with more capacity than can be put to use for an acceptable profit margin.

Banking and other financial institutions are facing hard times as well. "Banks are saddled with a heavy burden of bad debts" and "loans to heavy industrial projects that went sour in the 1970s and 1980s," noted an article in the January 24 Financial Times.

The most recent example of this is the January collapse of the Hanbo Steel Corp., Korea's second largest steel producer. The company defaulted on payment of a $5.8 billion dollar debt borrowed from national banks. Now the banks are scrambling to try to put together a loan package that will prevent bankruptcy. Two other subsidiaries of the Hanbo Group - Hanbo Energy Co. and Sang-A-Pharmaceutical Co. - have also declared bankruptcy.

As the recent strikes showed, the employers and their government in Seoul face sharp resistance to their attempts to push back workers' gains. In this test of strength, trade unionists in south Korea broadened their fight beyond a labor dispute between individual workers and bosses. The strikers won support from workers in industries not on strike, students, and others. And all the questions in dispute remain to be resolved in the battles ahead.

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