From Muskets to Capital: The Rise of the Multinational

Our entire world relies on technology to function, from buying and selling goods to forms of entertainment. Workers in this sector have an immense amount of power at their fingertips, as without their services much of our society would not be able to function. 

The original multinational

This article was featured in the Autumn 2020 edition of Rupture. Purchase the latest edition of Rupture here

The first multinational corporation was the Dutch East India Company. Founded in 1602 after an amalgamation of a number of different Dutch companies, the Dutch East India Company (by name United East India Company) was granted an unchallenged monopoly over Dutch operations in Asia until its demise in 1796. 

This private company was the original military-industrial complex. It had its own armed forces and navy, commanding close to 5,000 ships separate from the Dutch government, and was allowed to construct its own forts and towns and conclude treaties with Asian rulers. At the time it was larger and more powerful than some countries. This company was brutal, unchecked capitalism seeking to monopolise the spice and silk trade coming from Asia.

Today capitalism generally doesn’t need to be carried out at the end of a musket in the way that the Dutch East India Company would have operated. While capitalism will deploy violence when it deems it necessary, capitalists generally threaten nations with capital flight or loss of jobs in order to get their way or can demand low rates of tax in exchange for setting up operations in a country. 

Multinational companies are inherently reliant on a globalised market system, allowing them to operate simultaneously on different continents while working towards their ultimate goal of maximum profit. At the end of the 1960s, there were around 7,000 multinational corporations operating worldwide. Research in 2006 showed that there were at least 80,000 multinational corporations active around the globe. In a study that looked at the revenue of corporations and governments, it was found that 69 of the richest 100 entities on our planet were corporations, with the top 10 corporations raking in over $3 trillion. This list includes companies such as Walmart, Toyota and Shell.

In 2017, American multinational companies generated $83 billion in profit in Ireland alone, which was larger than six of the world’s largest economies combined.  As of this year, Apple is the largest technology company in the world. In 2019, they made $260.17 billion in revenue, with stores and operations in twenty-five countries. The Apple app store is also available in 175 countries around the world, having recently expanded to twenty more countries as of April this year. 

A Sea of Untaxed Income 

Ireland is the second-largest exporter of computer and IT services in the world, with huge multinational companies such as Intel, HP, IBM, Microsoft and Apple all having either manufacturing facilities or some other form of long-standing operations in the Republic of Ireland. One in seven of those working in Ireland is employed by a multinational company. A new record was reached in 2019 with 245,096 thousand people directly employed in the multinational sector.  Apple currently employs 6,000 people in the Republic of Ireland and have had some sort of base here for the last thirty-five years. 

But, why are they here? Governments of the past and present (and Apple themselves) want the Irish people to believe that Apple operates here because of “our educated workforce” or some other false reason. While our workforce is highly educated and it would play a part in large corporations setting up operations here, this is not the main reason that Apple or other huge multinational companies would choose to come to a tiny island on the edge of the Atlantic. 

The biggest reason is that Ireland is a tax haven, with one of the lowest rates of corporation tax among OECD (Organisation for Economic Cooperation) countries. It is estimated that multinational corporations shifted $106 billion (€90 billion) in profits to Ireland in 2015. Researchers also honed in on the high level of profits declared by US multinationals operating in Ireland, where US companies made $8 in profit for every $1 spent on wages.

Unionising the tech industry

Companies in previous centuries and decades had to rely on letters and hand-carried reports. Today companies can receive and distribute information to their respective branches or sites at the touch of the button. The Information and Communication Technology (ICT) sector employs 3.7% of the global workforce.

This heavy reliance on technology places ICT companies in a position to make immense profits. From retail store tills to large databases, almost every business in the world relies on some form of information or computer technology. However, this also places their workforces in a position of immense, untapped power. These workers have the potential to shut down entire sectors of business if they stop production in factories that manufacture technological goods or refuse to answer calls for IT help.

Unions are coming to the realization that the technology industry is an untapped sector of labour-power. In March this year, high-tech workers at Kickstarter in New York voted 47%-36% to unionise with The Office and Professional Employees International Union (OPEIU). Alongside the OPEIU, the Communications Workers of America has started an industry-wide campaign to unionise workers in the video game and technology industries.

For example, Google’s attempt to crackdown on unionising efforts at their offices in Switzerland in October 2019. Workers at this site began organising over disputes around issues such as retaliation after reporting sexual assault, pay equity, and company participation in controversial government contracts.

Google’s leadership at this site attempted to shut down the meeting, after sending an email to workers saying that the meeting, titled “Unions in Switzerland” had been cancelled. In the email, Google said it was cancelling the meeting because the company “prefers to only host events on the topic organised in partnership with Googe’s site leadership team”. Instead, leadership at this site said they would organise a talk instead to bring “a diverse set of presenters and perspectives”. This is just one example of a multinational corporation refusing to allow their employees to receive information that had not been vetted or filtered by their own channels, and the workers at this site saw through this.

Beyond the normal anti-union tactics, unionising in multinationals also has its own unique challenges. Workers at some sites around the globe may be unionised while others may not. This could be down to better labour laws in some countries or where workers have been particularly radicalised at one site in contrast to others. This creates a discrepancy in union representation within a multinational company and would potentially allow multinationals to isolate and bully particular sites into relinquishing their union representation. This is a real danger and trade unions across the globe will need to adapt to face this challenge if they are to effectively represent workers employed in multinational corporations.

Workers must be a multinational

If the technology sector is dominated by large multinational corporations, exploiting workers on every continent to maximise profits, then workers in these large companies must begin to see themselves as a multinational too. Capitalism is a worldwide system, designed to exploit the many for the benefit of the few. The multinationals are fundamental to this system. If a multinational company can force workers to accept low wages in a country with terrible labour laws, then workers who are employed by the same company in a country where their wages are far higher must treat this situation as an injury to themselves as well. 

As well as solidarity strikes orchestrated by workers from across the world in the same position within a company, strikes by workers from other positions in the same company could also be organised. For example, in a massive corporation like Amazon, if the warehouse workers go on strike in America to protest their abhorrent working conditions, then software developers operating in their UK offices could strike in solidarity with their colleagues in the warehouses. 

Capitalism is a global system that uses multinational corporations to exploit millions of people in different places around the world, and it will take a global, international approach by workers to defeat it.