Chef factory: why close a profitable enterprise?

January 31, 2001


MELBOURNE — Despite it being a profitable enterprise, the Chef whitegoods factory in Brunswick faces closure by its new owner, Email. The company owns a competing factory and now, having bought out its opposition, is planning to consolidate its monopoly by moving two of the most successful production lines to a new factory in Adelaide and closing or selling the rest.

On the face of it, Email's plans seem an astonishingly bloody-minded and even stupid thing to do — the Chef factory is making money, after all. Aren't they in business to make profits?

But buying out your opposition, taking their brand label to use as you see fit, and closing down the rest of their operations actually makes a lot of sense — from the capitalists' perspective. With a monopoly, you can largely dictate terms to the market: one reason why mergers and acquisitions are all the rage at the big end of town.

It's much like the game, Monopoly. Except that when all the properties are bought up, the game doesn't end, it just goes on to a new, more predatory level of competition: players try to buy each other out and ruin each other. And, of course, in the real world, it's not a game at all: "ruin" means workers are thrown out of a job.

The campaign by Chef workers and their union, the Australian Workers Union, has focussed on calls for the new owners to keep the factory at least partially open and to give decent redundancy payments to those who wish to go. The union's bargaining chip is a community and worker campaign to prevent the removal of equipment from the factory. It's a campaign worthy of support — with sufficient public backing, the strategy could prove very USELESS WORD?: effective.

But the broader economic questions posed by the Chef situation also prompt a broader response. Apart from fight instance by instance, is there anything more we can do?

Unions and leftists need to be more pro-active — by calling for the nationalisation of companies like Chef.

We hear all too much about privatisation, but its opposite seems to be a non-word. Is demanding nationalisation too far out? Outdated? A waste of time?

Quite the reverse. By calling for nationalisation (or re-nationalisation, such as for the power industry), our side begins to define the battleground, instead of reacting to each of the enemy's offensives as they come.

Firstly, calling for the nationalisation of such companies places the responsibility for the problem on the government. The individual company may be the immediate foe, but their predatory operations are just a symptom of a wider phenomenon in the capitalist economy.

The Victorian government is in a position to act — but despite vocal support by local Labor MPs for the Chef workers, the state Labor government has yet to take any action. Would they? The record of Bracks' government so far is not good (consider the Yallourn power workers). But putting this kind of pressure on them is a good way to build a pro-worker opposition to the ALP — something we'll have to do if we ever want to get beyond choosing the lesser of two evils for government.

Secondly, if we force the government to nationalise, it would be a blow against the anarchic system of competition that causes many factory closures and job losses.

Putting an industry into government ownership is not the same as socialism — not while the parliament and government bureaucracy is still dominated by the capitalists' representatives. But nationalisation does pose the question: why doesn't society take industry out of the hands of the private sector and put it under community control?

The wealthy few who own Email, with their need for ever-greater profits, would then no longer dictate the fate of the factory, and a great example would be given to workers in other factories and industries.

Socialists, left-wingers and trade union militants need to consider strategic measures like these. The union movement may still include some militant and powerful unions, but until we begin to reply to the attacks of the corporations with our own initiatives, we risk being gradually worn down in one defensive campaign after another.

[Ben Courtice is a member of the Australian Manufacturing Workers Union and of the Democratic Socialist Party.]

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