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From Mumbai to Melbourne (via Detroit): what future for ‘post-industrial’ society?

by Tom Barnes on September 29, 2014
Blog

I am a postdoctoral research fellow at the Australian Catholic University (ACU). With colleagues in ACU’s new Institute for Religion, Politics and Society, I am starting a project on ‘deindustrialisation’ and the decline of the automotive industry in Australia and the United States. We’ll be undertaking a comparative analysis of Melbourne/Geelong and Detroit, studying the social and economic impact of industrial decline and looking at policies that could help people make the transition to ‘post-industrial’ society.

As a political economist by training, I studied and taught for several years in the Department of Political Economy at the University of Sydney. It’s a great environment for research and teaching and is one of very few academic departments around the world committed to the study of political economy in the traditional sense: the idea that ‘the economy’ cannot be properly studied independently of society and politics and that there is no single or correct ‘orthodox’ approach to economics.

Despite the Great Recession that has shaped the world economy for the past six years, orthodox economics has not exactly reinvented itself. While there have been some developments in the wider field, virtually all economics departments insist that students must be schooled in neoclassical micro and macroeconomics before branching out into other studies. This approach is underpinned by ideological principles like individualism, free markets and small government, which continue to shape policy thinking too.

We can see this in government responses to de-industrialisation. In Australia, the dominant assumption is that government can and should do nothing (at least nothing substantial) in response to the looming exit of Ford, Holden and Toyota. This non-response is rooted in orthodox economic theories like comparative advantage—that economies will automatically and efficiently restructure in response to international trade—and the neoliberal view that states should not ‘interfere’ with private enterprise, regardless of the social consequences. Policy ideas based on alternative economic approaches like an active industry policy, economic planning and even—heaven forbid—nationalisation and public/common ownership are not considered.

Only a few years ago, the recession in the US and Europe put nationalisation back on the agenda. Since January 2009, the US government has spent about $US80 billion, a fraction of its wider economic stimulus fund, bailing out the ‘big three’ American carmakers: GM, Ford and Chrysler. GM was effectively nationalised (the government took a 61 percent stake) and Chrysler was eventually sold to Italian carmaker Fiat. After selling off remaining shares, the state’s net loss is in the order of $US25 billion. So it turns out that it is acceptable for states to manage and even nationalise industry if its means preventing total economic collapse.

In rather different circumstances, Australian governments of both shades have directed billions at the carmakers: Holden/GM received about $A1.8 billion in the decade to 2013, Ford about $A1.1 billion and Toyota an estimated $A1.2 billion. The former Labor government established a $A1.3 billion ‘Green Car Innovation Fund’ to encourage fuel-efficient cars (later cut by 15 percent). The fund didn’t stop Ford announcing that it would wind down production in Geelong and Melbourne by 2016. After its election in September 2013, the Abbott government refused to commit to further subsidies. Three months later, Holden announced it would cease production in north Adelaide by 2017. Toyota, based in Melbourne’s west, followed suit in February.

Our research project at ACU aims to study the social and economic impact of this decline. Among other things, we want to explore whether post-industrial regions face a future of precarious employment and declining living standards. We will document the plight of ex-auto workers and their families and analyse the response of civil society organisations like trade unions, welfare groups and church institutions.

Ford_stamping_plant_Geelong

Ford plant, Geelong

I hope to bring my background in studying auto workers to this project. My PhD (2007-2011) looked at informal labour in Indian cities (Bangalore, Mumbai, New Delhi) and, more recently, I have looked at the Indian auto industry as an example of rising precarious and ‘informal’ employment. Car production in India is a rapidly-growing, ‘sunrise’ sector; a mirror-image of trends in Australia and the US. I have spent many months talking to auto workers there. Some of the results are forthcoming in the Journal of Development Studies, as well as in my new book Informal Labour in Urban India: Three Cities, Three Journeys, which is out with Routledge in early 2015.

Although my new project focuses on the Anglo-American world, my interest in labour movements in Asia remains strong. That’s why I have established a new blog titled ‘Labour in the Asian Century’ to complement my work on labour in Australia. Perhaps cheekily, the title borrows from the former Labor government’s 2012 ‘white paper’, Australia in the Asian Century. Although quietly shelved by the Abbott government, it reflected mainstream interest in rising regional powers like China, India and Indonesia. It emphasised the rising Asian ‘middle class’ and the opportunities for Australian capital and the state in Asia. Despite a common interest in the ‘Asian century’, my main concern is to peer beneath the mainstream; to look at the workers and labouring communities whose struggles for security, livelihoods and employment rights underlie this economic and social transformation. The blog aims to document reports of struggle and develop analysis of these movements. Hopefully, it will be a useful contribution and I’d welcome your thoughts!

Tom Barnes
Tom Barnes is a postdoctoral research fellow at the newly-established Institute for Religion, Politics and Society at the Australian Catholic University. He did his PhD in Political Economy at the University of Sydney. His new book, Informal Labour in Urban India: Three Cities, Three Journeys, is out with Routledge in early 2015. He blogs at http://tombarnes.info/.

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