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Will Walkouts Mean A Slowdown For Labor? (Int'l Edition)


International -- European Business: BRITAIN

WILL WALKOUTS MEAN A SLOWDOWN FOR LABOR? (int'l edition)

Strikes could threaten Tony Blair's bid to be Prime Minister

Jerry, a fortyish commodities trader, is fuming. A strike has shut down the London Underground, his usual commuting route. He has been pacing the pavement for more than a half-hour as one after another of London's red, doubledecker buses passes by, too crammed with passengers to stop. "Something has to give," he mutters.

But what is likely is that Londoners and other residents of Britain will be in for more inconvenience. While nothing like in the bad old days of the late 1970s, labor tensions are markedly on the rise. Public-sector workers are increasingly unhappy with government efforts to hold them to 1% to 2% annual raises, and they are angry over fat salaries paid to executives of privatized companies. Labor unrest could well play a role in what promises to be a bruising election campaign between Prime Minister John Major and Labor Party leader Tony Blair.

The Aug. 14 stoppage was the seventh one-day walkout this summer by Underground train drivers pushing for a shorter workweek. At least four more are scheduled. Similar actions are disrupting the Royal Mail, whose workers are protesting tougher work rules. "People are starting to say this inequality has gone far enough and are raising their heads above the parapet again," says Chris Proctor, spokesman for the Communications Workers Union, which represents postal employees.

The strikes are turning out to be a huge embarrassment for Blair, who until recently seemed a sure winner. He has worked hard to distance his so-called New Labor party from its traditional trade union backbone. But the strikes are playing into the hands of conservatives, who are telling the public that the unions will make a comeback under Blair. Major must call elections by next May.

Indeed, recent polls show a narrowing of the wide lead that Blair has enjoyed over Major. In the most recent poll by ICM Research and The Guardian newspaper, Labor's lead fell to 12%, from around 20% earlier in the year.

Nick Sparrow, ICM's managing director, attributes the narrowing edge to an improving economy and greater scrutiny of Labor by the public and the press. But he also notes that a large majority of respondents said strikes would be more likely under Labor than under Conservative rule.

So it is in Major's interest to play tough and try to associate Blair with the unrest. The walkouts coincide nicely with an ominous Conservative ad campaign that warns "New Labor, new danger," implying a Blair victory will mean a return to socialism. Major and other Tory spokesmen have relentlessly blasted Labor leadership for not condemning the strikes. Perhaps with an eye on the many potential swing voters who use commuter lines, Labor urged the train drivers to stop their job actions. But Blair himself has stayed out of the postal dispute.

The government is taking steps that could increase tensions. It is turning up the heat on the postal workers, whose membership is split over the wisdom of striking. On Aug. 5, Trade & Industry Minister Ian Lang temporarily suspended the Royal Mail's longstanding monopoly on delivery of mail costing up to one pound, opening a window for private contractors. "We are not prepared to allow industrial disputes to inconvenience consumers and businesses," said a Ministry spokesman. In other words, letter carriers were now at risk of losing their jobs to the private sector.

ON DECK. Major package carriers, such as United Parcel Service and Federal Express, declined to take immediate advantage of Lang's offer. But TNT, another big player, said it was willing to jump in if the government would permanently end the Royal Mail's monopoly. "The only way to deal with the strikes is to end the monopoly and license a second carrier," said a TNT spokesman.

Over the next few months, tensions seem bound to grow. With 3% growth expected next year and unemployment, now 7.7%, falling, union leaders see opportunity in a tighter labor market. There is also a sense, particularly among public-sector workers, that they're being left way behind as others reap the benefits of privatization and greater efficiency. Unions may also be trying to send a warning about further privatizations.

Of course, the workers' best protection would be a Blair victory, even if the smooth leader is not that far to the left of Major. But self-destruction is one of British Labor's grand traditions.By Stanley Reed, with Heidi Dawley and Julia Flynn in London


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