Thursday, November 12, 2009

[olympiaworkers] Strike at World's Largest Nickel Mine

International solidarity organizes against Vale Inco, 2nd largest
transnational mining giant in the world

By Marc Bonhomme; November 12, 2009 - Znet

Source: The Bullet

In France's south Pacific colony of New Caledonia, a small delegation of
Vale Inco strikers from Sudbury, in Northeastern Ontario, most of them
Franco-Ontarians, met in October with the union at the island's Vale Inco
nickel mine, due to open in 2010 although it threatens a UNESCO nature
reserve. The newspaper Nouvelles calédoniennes reported the encounter, in
its October 31 edition:

"In the face of the global economy, the labour movement is looking to
internationalize. In Canada, 3,500 workers at Vale Inco are currently on
strike. Their union, the United Steelworkers, has launched a crusade to
visit every Vale Inco site on the planet, for the purpose of forging
alliances. In New Caledonia, union representatives met with the unions
that represent the workers at the plant located in the south. ...

For the past three and a half months, ...workers at Vale Inco in Canada
have been engaged in a test of strength with the Brazilian multinational
that absorbed Inco, the Canadian nickel giant which initiated the Goro
Nickel project in Caledonia. ...

They are accusing the Vale group of taking advantage of the global crisis
and lower profits to make underhanded cuts in employees' wages, pension
plans and social assistance programs. They are also organizing visits to
all of Vale Inco's sites in Brazil, Indonesia, Australia and New
Caledonia, to create a sort of worldwide alliance between the various
unions that represent the multinational corporation's employees."[1]

The strike at Vale Inco began in mid-July at Sudbury, a city of 150,000
inhabitants, one third of them Francophone. In early August the strike was
joined by workers at the Vale Inco refinery in Port Colborne, on Lake
Erie, and the mine at Voisey's Bay in Labrador. Vale is engaged in a
frenzied competition with BHP-Billiton, an Australian-British company and
the world's largest, Rio Tinto, the third largest, and other mining giants
in a process of concentration and centralization of the international
mining industry. They are seeking to profit from the exponential rise in
metal prices in recent years as a result of the explosive growth in demand
in the emerging economies, and to strengthen their position with the major
purchasers, above all the Chinese government and the big new producers in
those countries.

Vale, too big to be defeated in a single country

In a push for diversification, Vale, a leading iron ore producer,
purchased the Canadian nickel transnational Inco two years ago. The
current economic crisis suddenly forced down raw materials prices,
particularly for nickel. Vale, which had earlier settled for contract
improvements with its employees in Thompson, Manitoba, is now demanding
that its other workers agree to a three-year wage freeze, a defined
contributions pension plan for new hires (the current plan is defined
benefits), a major reduction in the annual production bonus (which has
averaged 25% of the base wage), now to be pegged to the firm's
profitability, and a weaker wage indexation clause.

But unlike its major rivals, who have experienced liquidity problems
resulting in major layoffs - Rio Tinto-Alcan in Quebec, for example - Vale
has remained quite profitable despite the collapse in prices and has not
carried out massive layoffs, although it did dismiss a few hundred Inco
employees after buying this company. In Brazil itself, it plans to
increase its workforce by 12% in 2010 following major investments demanded
by the Brazilian government; the state-owned banks are significant
financiers of Vale. In Brazil, as in New Caledonia, wages are lower, and
perhaps the environmental constraints as well.

In 2008 Vale made a profit of US$13.2-billion. Its subsidiary Vale Inco
made more profits in two years (2006-2008) than Inco did in ten
(1996-2006): US$4.1-billion. In the third quarter of 2009, together with
the new rise in nickel and iron ore prices, its profit doubled from the
previous quarter although it was only a third of what it was in the same
period in 2008. The company was so proud of this result that its directors
had planned to go to the New York and London stock exchanges for media
events in late October. Unfortunately for them, they had to cancel when
small delegations of strikers came to disrupt the events with the help of
local union members linked with the International Trade Union
Confederation (ITUC) - about twenty strikers in New York supported by U.S.
steelworkers but also some teachers.

Vale was so optimistic at that point that it announced it would be
distributing $2.75-billion in dividends in 2009 - more than the cost of
the wages and benefits of its 100,000 plus employees in 35 countries
worldwide. But the strike has been relatively effective. Nickel production
in the third quarter of 2009 is down by 45% from the second quarter and by
55% from the equivalent quarter in 2008, not to mention the direct cost of
$200-million for the strike. However, the new rise in nickel prices has
somewhat offset the lower volume, and the production of nickel (and
copper, which Vale Inco extracts concurrently) is a marginal component of
the transnational's overall operations, while it was central for the old

Vale profits from the severity of the crisis in Ontario

Since its privatization in 1997 - it was a state-owned corporation in
Brazil, founded during the Second World War - Vale has been systematically
fighting its workers. In Brazil, its employees have no job security; the
company dismisses them without cause and fires most once they have three
to five years seniority in order to hire at a lower wage, which explains
why the majority are on fixed-term contracts. In the current strike in
Canada, Vale has hired strikebreakers and required its other workers to do
the work of the strikers. The New Democratic Party (NDP) sought
unsuccessfully in the Ontario legislature, with the applause of strikers
in the visitors' gallery, who were expelled, to present anti-scab
legislation like that in Quebec. The NDP, a social-liberal party linked to
the trade-union movement, is the most left-wing party in the Ontario
legislature. It divides the northern and northeastern seats, which are
very blue-collar, especially outside the few major urban areas, with the
governing Liberals, although it has only 10 out of the province's 107

The relative isolation of the strikers from the major metropolitan centers
in the south of the province has not facilitated efforts to build
solidarity. However, it is worth noting the solidarity of other
Steelworkers locals and the Ontario branch of the Canadian Union of Public
Employees (CUPE), known for its vanguard role in the boycott, divestment
and sanctions campaign in support of Palestine, and for its municipal
worker locals in Toronto and Windsor, which waged hard-fought strikes this
summer to fend off concessions demanded by the municipal authorities
including the so-called progressive city council in Toronto. These
politicians sought to benefit from the crisis in the automobile, steel and
financial industries that has hit hard at the Ontario economy, which
accounts for 40% of the Canadian GNP. It is no accident that the conflict
at Vale Inco began this summer while these major strikes were taking

Nevertheless, this solidarity consists at best in visits by a few leaders,
sometimes with cheques in support, and the mobilization of limited pockets
of militants when strikers visit Toronto, for example to agitate at
Queen's Park, the site of the Ontario legislature, or to respond to the
invitation of the iconoclastic film director Michael Moore when he was in
Toronto for the premiere of Capitalism: A Love Story. Until quite recently
the international mobilization has remained quite modest: letters of
support from unions in less than a dozen countries and tours in Germany
and Sweden accompanied by international leaders to convince certain
companies not to import nickel ore from Vale. Even the big rally in late
September with international guests, including the president of the CUT,
the major Brazilian trade-union central, drew only 3,000 persons, slightly
less than the total number of strikers in Sudbury.

A possible turning-point in October

It appears, however, that things took a turn for the better in October.
The women's strike support committee, which played such an important role
in the very militant nine-month strike in 1978-79, was re-established with
the help of former activists. Working with the recently constituted
support committee, it will be organizing a series of family activities in
November. The Ukrainian community in the region has also become involved.
The spirit of 1978-79 could be regained. There appear to be some changes
as well in terms of international solidarity. In addition to the trip to
New York, a small delegation has returned from Australia, where Vale
purchased several coal mines in 2007, and New Caledonia, where Vale Inco
will soon open a new nickel mine. Dozens of Australian miners expressed
their sympathy with the delegation, as did their leaders. But their
contract terminates only in 2011.

In New Caledonia, there was remarkable media coverage and a warm reception
from the Kanak elected representatives. The Kanaks are the first nation in
this French colony, although they now make up only 45% of the total
population. Did the Kanaks sense they had a lot in common with the
Franco-Ontarians in the delegation - two nationalities suffering
oppression of their language, their economic conditions and their lack of
territorial autonomy? Oddly enough, the Steelworkers web site devoted to
this conflict, from which most of the information in this article is
derived, is bilingual - in English and Brazilian Portuguese. And the
publication materials are English-only. But the Sudbury region itself is
strongly Francophone, and is not far from the Quebec border. Will this
uniform and formal unity strengthen the capacity for mass mobilization? Is
this the best way to build a pan-Canadian movement? Internationalism, to
be effective, must begin at home.

It is in Brazil, Vale's economic base by far, where the situation is most
promising. The miners in the company's largest Brazilian mine, and two
other mines, staged a two-day strike, October 26-27, around their own
demands. A few days later, at two other mines affiliated with the smallest
union central, Conlutas, which is known for its militancy, the bargaining
committee symbolically invited the woman representing the Canadian
steelworkers to be part of their bargaining team, to the anger of the
employer's negotiators who threatened to break off the talks. And 700
workers in these two mines signed a letter to the company calling on it to
settle the strike in Canada, where negotiations have not resumed since the
strike began. In a release issued November 4, the union's leaders said:

"Vale fears more than just the possibility of victory in the strike by
Canadian brothers and sisters, a possibility strengthened by this gesture
of solidarity. It also fears the growing international unity which is
being built among Vale workers and also people in communities around the
world where Vale's profits have resulted in environmental disasters,
degradation of the natural environment and community disintegration."

Internationalist optimism and bureaucratic contradiction

This optimism is justified. But so far the development of international
links has been primarily at the initiative of the union bureaucracies.
Their willingness to develop an internationalist response should not be
under-estimated. They have been caught off guard by this strike and the
membership's willingness to take on a powerful transnational corporation
capable of holding out through even a militant strike as long as the
workers are isolated. They realize that the usual bureaucratic methods of
bargaining supported by a national strike limited to picketing and
controlled from above will inevitably result in some setbacks. When the
union ranks hesitate to fight back in the face of a difficult objective
situation, as in the automobile industry, the leaderships can force
through some concessions. But there may be a high price to pay in terms of
credibility once the threshold of an unlimited strike has been crossed. To
defeat Vale, there must be a certain degree of international coordination
in strikes, except perhaps in Brazil, where a national inter-union
coordination might suffice.

The need for the union bureaucracy to mobilize the ranks to some degree,
or to let them mobilize themselves without too many impediments, opens the
door to self-organization. Has the women's committee given the cue? The
need to develop international links and an openness toward working-class
internationalism, particularly with the Brazilian unions, forces the
bureaucrats to restrain any temptation to engage in the kind of chauvinist
language characteristic of a small imperialist power that we hear so often
in Canada - "defending our middle-class, anti-ecology status" while
allowing Vale to chip away at the wage scales and working conditions of
its employees elsewhere.

The Steelworkers are styled an "international" union, although they have
locals only in the USA and Canada. So when the "international" president
of the union called for nationalization of Vale at the big strike support
rally in late September, to the standing ovation of the strikers, there
was a note of ambiguity. If nationalization means a takeover by the
capitalist state in order to escape Brazilian living conditions, that is a
setback for internationalism - and an economic illusion, for the nickel
market is worldwide. A state corporation would do as Vale does. However,
nationalization can signify the first step in the takeover by the workers
collectively, as the Zanon workers took over their plant in Argentina.[2]
The self-managed collective would confront the state with the need to
provide financing, technical assistance and guarantees of international
markets, if not conversion of the company and retraining of the workers.
It would make the undertaking an integral part of the community, and in
the case of a firm that is intrinsically an exporter, would also link with
the workers in client and competitor firms abroad in support of their
demands and their struggles, within a perspective of collaboration for
joint marketing in the context of a levelling upward of living conditions.
It would be a first step toward internationalist self-management.

Irrespective of whether it goes forward or is worn down, this strike
against Vale gives some idea of what the strike movement will be like in
the 21st century. Global strikes against transnational corporations will
be an essential pillar of internationalism. They are just beginning.

Marc Bonhomme is an economist and member of Québec solidaire. Translated
from the original French by Richard Fidler.


1. Retranslated from the French.

2. A strike made famous by Naomi Klein and Avi Lewis in their film The
Take. For recent coverage of the Zanon struggle, see "Zanon workers win
major legal battle"


The web site of the Vale Inco families and community members may be
accessed at

Bullet #253: Down in the Vale, by Petra Veltri

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