when wal-mart wimped out

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WHEN WAL-MART WIMPED OUTMarc BlecherVersion of record first published: 21 May 2008.

To cite this article: Marc Blecher (2008): WHEN WAL-MART WIMPED OUT, Critical Asian Studies, 40:2, 263-276

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Blecher / Wal-Mart

PERSPECTIVE

WHEN WAL-MART WIMPED OUT

Globalization and Unionization in China

Marc Blecher

ABSTRACT: This article offers one China analyst’s perspective on a variety of ques-tions related to the unionization of all sixty-six Wal-Mart outlets in China. Why didChina force Wal-Mart to unionize? If, as Marx, paraphrasing Hegel, wrote, “all greatworld-historic facts and personages appear, so to speak, twice,” is Mao making hiscomeback? Or if, as Marx immediately continued in his own right, “He forgot to add:the first time as tragedy, the second time as farce,” is Hu Jintao playing LouisBonaparte to Mao’s Napoleon? Is the Chinese state acting out of a new level of confi-dence that it can now challenge the world’s most prepossessing corporate giants inorder to make good on its communist commitments? Is it running scared in the faceof a working class that has at last managed to score a victory? Or is it actuallystrengthening its power through time-honored tactics of mass organizational con-trol that have not really changed despite the new market context? Are China’s work-ers being protected, empowered, or co-opted and subjected to new forms of statecontrol? And why did one of the world’s most militantly antiunion corporations goalong? Did they have a choice? Did they fear China’s state-run union federation? Andfinally, what does all this portend for the future of labor relations in China?

Workers have set up unions at all sixty-six Wal-Mart outlets in China, begin-ning what a Chinese union official described Thursday as a wider cam-paign aimed at other foreign companies.

Wal-Mart has long battled to ban unions from its stores and distributioncenters, and Guo Wencai, a senior organizer of the government-sanc-tioned All-China Federation of Trade Unions, called the establishment ofunion branches at the Wal-Mart stores a “breakthrough” for organized la-bor.

Critical Asian Studies40:2 (2008), 263–276

ISSN 1467-2715 print/1472-6033 online / 02 / 000263–14 ©2008 BCAS, Inc. DOI: 10.1080/14672710802076796

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Mr. Guo said at a news conference here that the success at Wal-Martwould be a springboard to similar efforts aimed at Eastman Kodak, Delland other companies.1

China is planning to adopt a new law that seeks to crack down on sweat-shops and protect workers’ rights by giving unions real power for the firsttime since it introduced market forces in the 1980’s.2

What is going on here? If, as Marx, paraphrasing Hegel, wrote, “all great world-historic facts and personages appear, so to speak, twice,” is Mao making hiscomeback? Or if, as Marx immediately continued in his own right, “He forgot toadd: the first time as tragedy, the second time as farce,” is Hu Jintao playingLouis Bonaparte to Mao’s Napoleon? Is the Chinese state acting out of a newlevel of confidence that it can now challenge the world’s most prepossessingcorporate giants in order to make good on its communist commitments? Is itrunning scared in the face of a working class that has at last managed, throughyears of spontaneous, disorganized and apparently ineffective protest againstincreasing inequality and insecurity, to score a victory? Or is it actually strength-ening its power through time-honored tactics of mass organizational controlthat have not really changed despite the new market context? Are China’s work-ers being protected, empowered, or co-opted and subjected to new forms ofstate control?

China’s Labor Unions

The All-China Federation of Trade Unions (ACFTU) was created out of the Le-ninist mold of “mass organizations” of the Communist Party and its state. In theearly 1950s China’s myriad, autonomous and often radical labor unions, manyof which had fought long and hard, if unsuccessfully, over decades, some forworkers’ rights and others for the revolution,were brought under ACFTU lead-ership. The efforts of the old unions and many of their activists to continue tomilitate on behalf of the proletariat even as the state sought to discipline theworking class in order to promote labor peace and economic developmentwere snuffed out by the end of the strike wave of 1957. Thus, the ACFTU was nota significant protagonist in the working class radicalism of the Cultural Revolu-tion.

Nor has it played any significant role in mediating, much less advocating foror fomenting, labor protest in the period of structural reform starting in 1978.3

264 Critical Asian Studies 40:2 (2008)

1. “Official union in China says all Wal-Marts are organized,” International HeraldTribune, 13 October 2006.

2. “China drafts law to boost unions and end abuse,” New York Times, 13 October2006.

3. The commonplace term for the vast changes that have taken place in China since1978 is “reform.” It is appropriate insofar as it refers to aspects of the process bywhich these transformations have occurred. Change has been pursued graduallyand without large-scale violence. “Reform,” however, can hardly capture the depthand breadth of the substance of the changes. Since 1978, China has not merely

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In most cases, workers with grievances serious enough to send them into thestreets have not even bothered to seek support from their labor union along theway. That itself is a stunning indictment of the unions’ sheer irrelevance, partic-ularly at a time when their self-professed role was to insure “stability” (wen-ding)4 in labor relations and working class politics. Insofar as they make any sys-tematic effort to prevent, preempt, or canalize conflict, it is only in arrangingand administering collective contracts between workers and employers, ofwhich more anon. The unions’ other major role vis-à-vis labor politics is to mon-itor it, which they discharge by surveying workers’ opinions and by writing re-ports when problems flare up. And of course there are the quaint functions, leftover from Maoist days, of organizing leisure activities and welfare funds.

In the mid 1990s, Western scholars studying China’s labor unions foundsome seeds of a role for organized labor as a form of civil society. Some union of-ficials seemed concerned enough about workers interests, or at least abouttheir own professional autonomy as labor union officials, to begin to carve out alittle space to advocate for workers.5 Union officials’ positions were being sev-ered from the factory management so that they could advocate with the man-agement on workers’ behalf.6 Yet a decade later, there is scant evidence of anysuch independence. Even some recent experiments with elections of basic-levelunion officials in a few places have proven of little consequence beyond the ef-forts of those officials to legitimate their positions within the union bureau-cracy.7

Workers see all this with crystal clarity, which is why they don’t bother withtheir unions when they are disaffected. Not a single worker I interviewed in themiddle and late 1990s thought the labor union had any significant role in repre-senting workers or advocating for their interests. Most said so out of disinterestand ignorance about the union rather than active antipathy toward it. In otherwords, for them the union was, in the main, irrelevant: it didn’t so much act onthe side of the state or of employers as not act at all. When protests occur, rarelyis the focus on incompetent, indolent or corrupt union officials. In the last sev-

Blecher / Wal-Mart 265

been tinkering with, perfecting, or toning down Maoist state socialism. Somethingfar more thoroughgoing has taken place. The country has excised, root andbranch, many of the basic elements of its Maoist polity, economy, society, and politi-cal culture. It has questioned almost everything that went before. Its leaders andpeople have sought to create new forms of political authority, economic activity, so-cial organization, and cultural expression that have no precedent in China or in-deed the world. If revolution is defined as a “basic transformation of a society’sstate and class structures” (Skocpol 1979, 4), then what China has been undergo-ing is no mere “reform,” but rather something that would more aptly be called apeaceful revolution. Another, perhaps less oxymoronic, term to capture China’sgradual and peaceful process toward “basic transformation of the state and classstructures’ is ‘structural reform.’”

4. Personal interview with union officials, Beijing, 1999 and in other years.5. White, Howell, and Shang 1996, chap. 3; Blecher 1997.6. Personal interviews, Tianjin, 1995.7. Unpublished paper whose author and title must remain anonymous as it is still un-

der review for journal publication.

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eral years, the fastest growing official channel for workers to seek redress ofgrievances is through labor arbitration panels, not unions. Indeed, the unionsgenerally don’t even assist their members who file such grievances.

In much of the export-oriented sector, unions do not even exist. The ACFTUhas had difficulty keeping up with the efflorescence of new industrial enter-prises since the start of the structural reforms in 1978, and especially since theexplosion of export-oriented industrialization that followed the triumph of cap-italist-oriented policy, including labor market “reform,” from the mid 1990s.8

Foreign firms that employ Chinese labor either directly in their own firms or in-directly through Chinese firms with which they contract divide into two broadcategories in their approach to this situation. Those from countries with repres-sive systems of labor relations — which tend to include those from Hong Kong,South Korea, and Taiwan — naturally welcome it. The absence of genuine laborunion organization was often a significant consideration in their decision tocome to China in the first place. Some South Korean firms in particular did so inpart to escape from an environment of increasing challenges from their working


8. According to official statistics, the number of trade union branches in China de-clined from 627,000 in 1993 to 509,000 in 1999. (Statistical Yearbook of China2003, table 23–4.) (Figures for subsequent years gyrate wildly, and are highly sus-pect. The source contains a footnote referring to the need for statistical adjustmentin 2003.) The figures on union staff are steadier and, accordingly, more credible.They dropped from 554,000 in 1993 to 465,000 in 2003.

Shopkeepers tend their small eateries outside a Wal-Mart outlet in China’s capital, Beijing.Wal-Mart’s announced purchase of a chain of one hundred “hypermarkets” in China inOctober 2006 put the American corporate giant on target to become the biggest food anddepartment store network in China. (AP Photo/Elizabeth Dalziel)

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class at home. On the other hand, for firms accustomed to dealing with laborunions in their home countries — which tend to be those from the West and Ja-pan — Chinese unions serve the valuable role of streamlining and regularizinglabor relations. The 1995 Labor Law specifies a major role for ACFTU branchesin arranging collective contracts with workers. These firms find collective con-tracting attractive since it saves them the administrative trouble of offering, ink-ing and following contracts with each individual worker. Having unions in theirplants can also help them receive social accountability certifications such as SA8000, which are required by some major Western retailers.9 It is all the morebeneficial for such employers that these same unions generally do little or noth-ing to enforce those contracts.

The ACFTU and Wal-Mart

Don’t think it won’t happen because it hasn’t happened yet.— Jackson Browne

In October 2004, the ACFTU published a “blacklist” of global corporations — in-cluding Wal-Mart, Dell, Eastman Kodak, McDonald’s, and Samsung — that for-bade the establishment of unions. Article 10 of the 2001 Trade Union Lawactually required that union branches be established in workplaces withtwenty-five or more workers, though the provision was honored mainly in thebreach. The government was now beginning to signal a more aggressive stance.On November 1, new Guangdong provincial regulations came into effect thatallowed workers in firms with only ten workers to organize union branches.10

However, it was not its little outfits so much as Wal-Mart itself, the notoriouslyanti-union American retailing behemoth which had set its sights on conqueringthe Chinese market as well, that was the big beast in the ACFTU’s crosshairs. Itthreatened lawsuits against firms that flouted the law. “If foreign-funded compa-nies still deny their workers’ right to join the unions, the ACFTU will surely pur-sue litigation against them.”11 But as Wal-Mart’s clever lawyers argued, the lawstipulated that union membership in China is voluntary, and that thereforebranches had to be formed only if twenty-five workers requested as much.12 On22 November, just weeks later, Wal-Mart therefore only appeared to capitulatewhen it announced that “should associates13 request the formation of a union,Wal-Mart China will respect their wishes and honor its obligations underChina’s trade union law.”14Neither side was yet talking about any workers join-ing unions, though: the law in question simply forbade companies from pre-


9. Pun 2005, 111.10. China Labour Bulletin 2005.11. “China: A workers’ state helping the workers?” Business Week, 13 December 2004.12. Chan 2006.13. “Associates” is Wal-Mart–speak for what in an older parlance was once called “work-

ers.”14. “Wal-Mart sets up 19 trade unions in Chinese outlets,” People’s Daily, 19 August

2006.

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venting workers from unionizing, and the legal issue was limited to whetherWal-Mart was doing so.

Wal-Mart could also sleep soundly at night in the knowledge that in Chinaworkers don’t unionize — rather, the state, through the ACFTU, “unionizes”them. That is, “unionization” consists of the ACFTU working in close collabora-tion with management to establish a union office in the firm. A mid-level com-pany official is appointed as chair of the union branch. The branch often doesn’teven bother to publicize its great victory to the workers in the firm. Nonethe-less, Wal-Mart was so strident in its opposition to anything called a “union” thatit stiff-armed even the feeble, collaborationist ACFTU version of enterpriseunionism. In Nanjing, ACFTU representatives humiliated themselves by payingno less than twenty-six visits to their local Wal-Mart superstore over a two-yearperiod without landing a single meeting with the store manager.15 During thisperiod Wal-Marts all over China engaged in similar obstructionism.16

These insults only added to the injury of falling membership rolls that theACFTU was experiencing from state industry retrenchment. It was ready forsomething new. Since Wal-Mart had agreed to abide by the legal stipulation thatunions’ branches could be established if workers requested as much, perhaps itwas time to mobilize the workers to make such a request. In the summer of2006, the union began for the first time to adopt tactics not so different fromthose used in organizing drives in other countries, including the United States.It sent organizers into Wal-Mart. Some, disguised as shoppers, went into storesand chatted up workers about the benefits of establishing a union branch.17 Oth-ers approached workers off-site, plying them with literature and pep talk.18

The difference between an ACFTU organizing drive and one run by an Ameri-can union is that the former is backed by the power of the Chinese state. None-theless, Wal-Mart banked on the fact that Chinese workers today have a greatdeal of autonomy from the country’s ostensibly communist state. It confidentlyreassured its investors: a few of its employees may possibly have used theu-word in loose conversation, “but it takes more than scattered interest for thecompany to be required by law to respond.”19 Wal-Mart could rely at least in parton a combination of workers’ disinterest or downright disdain for politics ingeneral and the ACFTU in particular.20 But it didn’t quite trust the ideologicalhegemony of the capitalist economy and the Chinese state: Wal-Mart also cau-tioned its workers not to talk with union representatives while on the job. AWal-Mart publicist put it thus: “We pay our workers to take care of customers. We


15. One can only hope that at least they refreshed themselves with a nice lunch at un-ion expense after each failed outing.

16. Chan 2006.17. “China’s union push leaves Wal-Mart with hard choice,” Wall Street Journal, 16 May

2006.18. Chan 2006.19. “China’s union push leaves Wal-Mart with hard choice,” Wall Street Journal, 16 May

2006.20. Blecher 2002, 283–303.

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clearly can’t permit a situation where workers are free to engage in political dis-cussion during the work day.” In a supreme irony, ACFTU organizers, all Com-munist Party loyalists, decried the fact that Wal-Mart’s tactics indeed made work-ers feel intimidated.21

On 14 March 2006 president and party general Secretary Hu Jintao moved tobreak the stalemate, sending out the call to “do a better job of building Party or-ganizations and trade unions in foreign-invested enterprises.” The ACFTU did-n’t have to think long about its response. Two days later, it averred that it had al-ready “instructed its staff to study Hu Jintao’s comments, and it set the target ofunionizing 60 percent or more of the country’s foreign-invested enterprises bythe end of 2006, and 80 percent or more by the end of 2007.”22 Now the Chinesestate demonstrated its legendary capacity to achieve its high priority goals. Ac-cording to Chinese press reports, first out of the gate was a certain Ke Yulong, ameatpacker in the Quanzhou (Fujian) Wal-Mart. Together with two like-mindedcoworkers, Ke sought out the help of the local ACFTU office, which establisheda secret task force to “guide” them. When they had mobilized a full five morethan the requisite number of fellow “associates” to apply for a union branch, amidnight meeting was held and, to add to the drama, they all affixed theirthumb-prints to the application in the early hours of 29 July 2006.

At 6.30 A.M. they declared the union branch formed and sang the Interna-tionale beneath a banner that read, “Determined to take the road to de-velop trade unionism with Chinese characteristics!” Filled with emotion,Ke made his opening speech, “All young people since historical times haveambitions. To be one among the first group of trade union members in aWal-Mart store is the most meaningful achievement of our lives. It is amemory we will forever cherish.” The ACFTU later declared the ceremonya “historical breakthrough” in China’s labor movement history.23

The race was now on. Within days, union-minded Wal-Mart workers at otherstores were convening clandestine nocturnal conclaves. Somehow, in a countryin which news of workers’ politics is normally bottled up by the state-run mediaand the watchdogs of the private media, it took only a week for forty-two mem-bers of the Shenzhen proletariat nonetheless to get the word and follow suit. Bythe very next day, the mass movement had leapfrogged a number of provincialboundaries into Jiangsu, where thirty-one Nanjing Wal-Mart workers crossedthe town-gown divide in choosing a university graduate as their trade unionleader.24 Now there was no stopping the workers of Wal-Mart: within hourstwelve of them unionized another Shenzhen outlet, followed three days later bya third in the city and the fifth in the country. This last exceeded by as much astwo the required twenty-five unionists.


21. “China’s union push leaves Wal-Mart with hard choice,” Wall Street Journal, 16 May2006.

22. China Labour Bulletin 2006.23. Chan 2006, quoting Chinese press reports.24. Ibid.

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Wal-Mart, frustrated by being outmaneuvered by the ACFTU’s new strategy ofmass mobilization, first responded with its anti-union reflexes. It warned work-ers at mass meetings that those who joined the union would be fired. It said itwould refuse to pay the 2 percent of the wage bill into the union’s coffers.25 Butas the number of stores under attack from the union mounted, it caved in to theinevitable, seeking to manage the unionization rather than oppose it. On 9 Au-gust it requested a meeting with the ACFTU. In another delicious irony, Xinhua,the official Chinese news agency, reported that it was Wal-Mart that demanded“no media presence,” and of course the company refused to reveal what hap-pened at the meeting.26 Some details of a similar meeting held in Shenzhen thefollowing week have emerged, though. Wal-Mart demanded that top managerssit on the preparatory branch committee, and that managers be permitted sit onthe eventual executive committee and even chair it. They had to settle for a for-mula only slightly less favorable to their vision of enterprise-dominated union-ism: up to twenty percent of the union executive committee could be middle-(not top-) level managers.27

But if Wal-Mart scored some successes in negotiating the governance struc-ture of the new unions, it completely lost the battle over the organizing drive it-self. A dozen more stores saw the establishment of union branches within thefollowing week. By mid October all sixty-six Chinese Wal-Marts were union-ized.28 The Chinese press reported that this upsurge of organization was under-taken “on the initiative of the workers themselves” to enforce their country’s le-gal mandate that all enterprises with twenty-five or more employees have un-ions to represent the interests of the working class.29

Wal-Mart protested that the initiative actually came, rather, from the Partyand the ACFTU. The deputy CEO of Wal-Mart China complained — interestinglyand significantly, in an interview with a Chinese newspaper — that organizershad bribed workers in the flagship Quanzhou unionization drive to sign up. TheACFTU admitted the gifts, but said they were provided to all workers in thebuilding, whether employed by Wal-Mart or not, only “to help the workersthrough the current season of hot weather.”30

Once Wal-Mart switched from opposition, obstruction, and complaint andaccepted the inevitability of enterprise unionism “with Chinese characteristics,”it became not just compliant but downright servile, at least in its political rheto-ric. Whoever wrote Wal-Mart’s press releases was either a Party member, wasscripted by one, or had mastered the official discourse. In the midst of the orga-nizing drive in early August, Li Chengjie, Wal-Mart China’s vice-president,averred that the company was after “more effective and harmonious” coopera-


25. Ibid.26. “Wal-Mart nears unionization in China,” Associated Press, 9 August 2006.27. Chan 2007, 95.28. “Official union in China says all Wal-Marts are organized,” New York Times, 13 Octo-

ber 2006.29. China Labour Bulletin 2006.30. Ershiyi shiji jingji baodao (Twenty-First-Century Economics News), 5 August 2006.

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tion with the ACFTU; or at least that’s how the official Xinhua News Agency putit.31 Ten days later The People’s Daily reported: “‘The negotiations betweenWal-Mart and the ACFTU have proved fruitful. The two sides have agreed to setup trade unions in Wal-Mart Chinese outlets on a cooperative and harmoniousbasis and in line with Chinese laws,’ an ACFTU official said Friday in an interviewwith Xinhua.” Joe Hatfield, President of Wal-Mart Asia, now played (or was madeto play) the dummy to the Chinese government’s ventriloquist: “We think [theunionization] is in line with the Chinese government’s efforts to build a harmo-nious society.”32 The phrase “harmonious society” (hexie shehui) is, of course,the ideological watchword of the Hu Jintao-Wen Jiabao government.

Globalization, Political “Modernization,” and the State

Modernization theory predicted that economic development throughout whatwas then called the “third world” would lead to the rise of middle classes andcivil society that would in turn foster the proliferation of liberal “democratic”political institutions. The “Washington consensus” said much the same thing,especially when it came to China. Every U.S. administration since Carter has hadto argue, in the face of criticism from atavistic cold warriors on the right and hu-man-rights oriented advocates on the left, that the best and, indeed, only way topromote “democratization” in China is to allow and, indeed, foster the coun-


31. Xinhua News Agency, 9 August 2006.

Workers perform a warm-up dance during the opening ceremony of a Wal-Mart store inShanghai in this 28 July 2005 AP file photo. By September 2007 seventy-seven of Wal-Mart’s eighty-four stores in China had union branches, covering twenty-one thousandworkers (over half of Wal-Mart’s local workforce). (AP Photo/Eugene Hoshiko, File)

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try’s economic growth, because that will lead to the rise of a middle class whichwill inevitably undermine Communist Party rule. In effect, the argument runs,economic globalization will lead to political globalization. The class bias of suchtheorizing is important and, though obvious, all too infrequently noted. It is themiddle classes, not the working class, that will be the handmaiden of “democ-racy.” Setting that objection aside, the question still obtains: will economic glob-alization result in the importation of civil society — in this case, labor unionsworthy of the name — for China’s workers?

Even as brave and smart a labor advocate as Han Dongfang is trying to put apositive face on the ACFTU’s initiative in organizing branches in marquee West-ern firms. Han, the leading worker activist in the 1989 protests, who was subse-quently hunted down, arrested, tortured, and expelled from the country, andwho now militates courageously on behalf of Chinese workers from his base inHong Kong, sees something new and welcome in the recent developments.

To its credit, the ACFTU fought a tough campaign throughout 2004 tocompel Wal-Mart, Kodak, Dell and other foreign multinationals to permitunion branches in their mainland stores and factories. In November thatyear, under threat of a lawsuit, Wal-Mart bowed to the inevitable by statingthat if the company’s “associates” (that is, workers) themselves asked for aunion, it would not stand in their way. After that, the ACFTU resumed itsold tactic of politely approaching management and asking for permissionto set up unions. And again, Wal-Mart responded by “giving them coldgruel to eat,” to use the local expression.

Finally this summer [2006], the ACFTU summoned up its courage anddid what the Trade Union Law had all along empowered it to do. It wentinto Wal-Mart’s stores and actually tried to organise the workers. The re-sults were remarkable.33

Han is anything but a Pollyanna. He sees in the recent mobilization of theACFTU and the resulting Wal-Mart unionization drive not a victory but only thepotentiality for institutional political change that can benefit workers.

The ACFTU’s main challenge now is to prove that it is no longer the patsyof management. A litmus test will be how the ACFTU responds if the re-cently elected Wal-Mart union officers start demanding better workingconditions and wages from the “bad boy” of the international retail indus-try.

If it gives the green light to such real union activities, a blow will havebeen struck for millions of as yet un-unionized mainland workers — andfor the cause of international trade unionism.

It’s not easy for a leopard to change its spots, but in this case the price offailure could be extinction. The mainland is now a capitalist economy, andthe workforce needs a strong union on its side. If the ACFTU cannot


32. “Wal-Mart sets up 19 trade unions in Chinese outlets,” People’s Daily, 19 August2006.

33. Han 2006.

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perform this role, sooner or later the workers will look elsewhere. Fornow, though, China’s official union is to be congratulated on taking a boldfirst step in the right direction.34

Wal-Mart sees the ACFTU as it is, not as Han would like it to become. The dayafter the August 9 talks that led Wal-Mart to accept union branches in all of itsstores, Jonathan Dong, one of its publicists, was asked about the contradictionbetween the company’s capitulation in China and its stubborn anti-unionismelsewhere. “The union in China is fundamentally different from unions in theWest.…The [ACFTU] has made it clear that its goal is to work with employers,not promote confrontation.”35 Surely Dong was speaking on the basis not onlyor mainly of analysis by political scientists, but rather on an agreement Wal-Marthad hammered out the day before. Its interlocutor that day was a Chinese statethat remains as committed as ever to maintaining and reinforcing social “har-mony” based on economic development and political stability, all guaranteedby continuing Leninist institutional monopoly.

The Hu-Wen decision to mobilize the ACFTU can serve several purposes. Itmight legitimate the Chinese state in the eyes of the country’s proletariat,though the chances of that are remote in light of the general political apathyamong most workers and the dim view that even highly discontented, politi-cized workers have of the union. More likely, it reinforces the state’s capacity tomonitor and stabilize labor politics. In part this will involve preemption: a rein-vigorated ACFTU can provide the state the means to keep major foreign employ-ers like Wal-Mart from engaging in practices that would infuriate workers. It willalso involve surveillance: ACFTU branches are charged with monitoring allmanner of developments in their factories. This includes, of course, any initia-tives in the direction of independent worker organization: the ACFTU’s job is toprevent autonomous unionization, by preemption, cooptation or, in tandemwith other state agencies, downright suppression.

Han Dongfang’s call for the ACFTU actually to militate on behalf of workers isnot necessarily a call for it to assert some autonomy from the Party. It is a call forthe Party, through its union, to help workers before they try to help themselvesin ways the state may not like. In that sense Han still reflects traces of the statistorientation of countless generations of Chinese intellectuals. If the Chinesestate can get this much out of so implacable and courageous a foe as Han, it mayyet stand a chance of getting the ACFTU to attract and foster a more aggressivebreed of workers and labor leaders. Then there is also the ACFTU’s own paro-chial institutional interest: it needs to rebuild its membership rolls, and collects2 percent of the wages of the workers in the factories where it is organized.Finally, the country’s massive size and burgeoning growth provide the govern-ment real leverage against even juggernauts like Wal-Mart. And a retailer likeWal-Mart is not like a foreign industrial investor that can pick up and leave insearch of a less-regulated business environment. Indeed, the ACFTU wasshrewd in choosing Wal-Mart as its prime target. The company, fresh off the em-


34. Ibid.

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barrassment of having to desert Germany and South Korea, cannot afford an-other foreign debacle, especially at a time when it is on the defensive at home inthe face its political critics not to mention competition from Target.36 That helpsexplain why Wal-Mart has accommodated itself so fully to the ACFTU: by Sep-tember 2007, seventy-seven of Wal-Mart’s eighty-four Chinese stores had unionbranches, and twenty-one thousand workers — over half the total staff — weresigned up. The union federation was singing the praises of its “harmonious” re-lationship with the global giant, while still pointing up its expectation that 100percent of Wal-Mart employees would soon join up, and that the companywould continue to consult with the union “according to the law” in all mattersrelating to workers’ welfare. For its part, Wal-Mart pledged “never to profit fromsacrificing its workers’ interests.”37 So Han may be justified in allowing himself acertain optimism of the intellect as well as of the will, at least as far as Wal-Mart isconcerned.

Yet there are real limits here. Wal-Mart and major Western companies like itare relatively good employers in China, at least compared with the myriadsweatshops in the manufacturing sector, some run by Chinese and some by in-vestors from East Asian countries with pretty benighted labor practices. SoWal-Mart is much less likely to become a flashpoint of major labor conflict thanother firms anyway. It is possible, even likely, that some of the Chinese govern-ment’s thinking in targeting Wal-Mart is a strategy of “killing the chicken to scarethe monkey.” Yet China’s most predatory beasts will not change their ways justby watching Wal-Mart. A major extension of union organization into the manythousands of export sector firms where it is needed most will require an expo-nential increase in the kind of spadework that was exerted in just 60-oddWal-Marts. That would take resources and political commitment that seem be-yond the ACFTU in anything like its present form.

Finally, there is the question of how aggressive the Communist Party leader-ship is prepared to get with employers. This problem has economic and politi-cal aspects. Economically, Chinese development has apparently proceeded farenough, and provided enough advantages to foreign firms, to embolden the gov-ernment somewhat. Wal-Mart has not in the least been put off by the ACFTU’s or-ganizing drive: it is still going ahead with bold plans to become the largest for-eign retailer in China by acquiring Trust-Mart, a Taiwanese-based chain, for $1billion.38 And as noted above, Wal-Mart cannot relocate. The same cannot neces-sarily be said for export-oriented manufacturing firms, especially those in sec-tors with highly mobile plant and capital, such as apparel and electronics.

Politically, it is not clear how far the leadership will be interested in or willingto extend itself on behalf of the Chinese working class. Thus far its interest inworkers’ welfare has stemmed only from its concern with the potentially


35. China Labour Bulletin 2006.36. Barboza and Barbaro 2006.37. Yu 2007.38. “Wal-Mart said to be acquiring chain in China,” New York Times, 17 October 2006.39. Chan 2006, 99.

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destabilizing political ramifications of not doing so. During the first decade oflabor market liberalization, its strategy has not been to try to prevent protest byinsisting on proper, decent wages and working conditions, but rather to allowemployers to take what advantage they will of their workers and then deal, inci-dent by incident, with protest as it erupts. And this strategy has succeeded.China’s workers have been unable to mount a serious, coordinated politicalchallenge to the legitimacy and resilience of the state and its policy of radicalcapitalist transition. The increased level of concern with workers evinced by theHu-Wen leadership is based not only on a change in the amplitude of workerprotest in the short run, which actually has not changed that much, but moreimportantly on greater cautiousness about protest’s political potentiality. More-over, this same leadership has, if anything, strengthened the repressive appara-tus and atmosphere, making it even more difficult than before for workers (oranyone else) to organize themselves, even for spontaneous, ephemeral collec-tive action. This is the context within which the recent mobilization of theACFTU has taken place. Moreover, no sooner had the new union branches setup shop in Wal-Mart than the Party moved to establish Party committees in eachstore to supervise them.39 In this light, the objective seems to have had muchmore to do with maintaining the political status quo and preventing independ-ent unionization and wildcat protest than with achieving real advances forworkers.

It is certainly the case that in the sphere of labor politics globalization has notbrought in tow any of the political institutional change — e.g., the rise of civil so-ciety, much less democratization of labor relations — that have been suggestedby some strands of modernization and globalization theory. Au contraire,China’s rapid economic development and globalization have only strengthenedthe hand of its highly authoritarian state. That state may find it in its own politi-cal interest and capacity to stand up for a very limited group of workers to a verylimited degree, but this has nothing to do with any empowerment of the Chi-nese working class or even the development of any political space in which thatcould reasonably occur. Enterprise unionism is enough of a constraint on work-ers in countries like Japan. When built “with Chinese characteristics” by theAll-China Federation of Trade Unions, a mass organization of the Chinese Com-munist Party, the potentiality for a genuine working class movement shrinkseven further. Overall, then, even in bringing about the apparently stunningspectacle of Wal-Mart caving in to unionization in China, globalization has onlyweakened the Chinese working class.

EPILOGUE (6 May 2008): Material emerging after the completion of this article* con-firms its Gramscian argument about pessimism of the intellect mixed with slenderoptimism of the will. Most Wal-Mart union branches have been dominated by man-agement, its objective ally in the local Party branches, or both. Dispirited worker ac-tivists have been crying out in their blogs to “save the Wal-Mart union!” Others haveaccused their democratically elected branch leader and his accountant of corrup-


* The emergence of real trade unionism in Wal-Mart stores!” China Labor NewsTranslations, April 2008 (http://www.clntranslations.org/file_download/49).

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tion, authoritarianism, and sloth. Han Dongfang was driven to abandon his earlierhopes, arguing in March 2008 that the Wal-Mart unions were window dressing.

Yet there are rays of hope. In the Nanchang Bayi Wal-Mart, Gao Haitao, an ordi-nary worker and elected union committee member, began militating when Wal-Mart’s shifted the cost of new year bonuses to the union and treated Wal-Mart’s re-quired contribution to the union of 2 percent of the payroll as a loan. Wal-Mart pres-sured the Nanchang City union to silence Gao, and also tried to create an alternativeunion committee under its control. Gao beat them back with his self-taught knowl-edge of the law and the support he enlisted from the central union offices in Beijing.Membership in the Nanchang Bayi union soared, and workers began to organizetheir own fund to defend Gao and their union.

Political conflict around the Wal-Mart unionization remains, then, on a low boil.Wal-Mart continues to maneuver for control, seeking alliances with union and partylocals. A handful of workers continue to resist, drawing upon the evident cleavagebetween local authorities and their superiors in Beijing who have a new and differ-ent, if still heavily statist, view of the positive role of unionization in China for politi-cal stability. The preponderance of power lies with Wal-Mart and its local state alliesdown in the trenches. But they cannot afford complacency.

References

Barboza, David, and Michael Barbaro. 2006. Wal-Mart said to be acquiring chain inChina. New York Times, 17 October.

Blecher, Marc. 1997. A world to lose: Workers, work, welfare and the state in mid-1990sChina. The puzzle, provisos, and some pieces. Paper prepared for the Fifty-NinthAnnual Meeting of the Association for Asian Studies, Chicago, 13–16 March.

———. 2002. Hegemony and workers’ politics in China. China Quarterly 170 (June):283–303.

Chan, Anita. 2006. Organizing Wal-Mart: The Chinese trade union at a crossroads. JapanFocus. 8 September.

———. 2007. Organizing Wal-Mart in China: Two steps forward, one step back. New La-bor Forum 16 (2) (spring).

China Labour Bulletin 2005. More than 10,000 striking workers at Japanese-investedWal-Mart supplier firm in Shenzhen demand right to set up their own trade union.22 April.

———. 2006. Wal-Mart unionisation drive ordered by Hu Jintao in March: A total of 17union branches now set up. 15 August. Available at http://www.clb.org.hk/en/node/39060; accessed 25 March 2008.

Han, Dongfang. 2006. Enter the fire-breathing dragon? South China Morning Post, 30September.

Pun, Ngai. 2005. Global production, company codes of conduct, and labor conditions inChina: A case study of two factories. China Journal 54: 111.

Skocpol, Theda. 1979. States and social revolutions: A comparative analysis of France,Russia and China. Cambridge: Cambridge University Press.

White, Gordon, Jude Howell, and Shang Xiaoyuan. 1996. In search of civil society: Mar-ket reform and social change in contemporary China. Oxford and New York: Ox-ford University Press.

Yu Wanni. 2007. Quanzong yu Waerma juxing gaoceng huitan (Labor federation andWal-mart hold high-level talks). Zhonghua quanguo zonggonghui (All-China Feder-ation of Labor Report), no. 197: 20 September.

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when wal-mart wimped out

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