Paul Fontaine writes Grapevine’s online news and is also, in the name of full disclosure, a member of the Industrial Workers of the World - Iceland.
Right now, it’s pretty safe to say there is a kind of class war taking place in Iceland, and it’s one management is waging against the working class. About a week ago at the time of this writing, Iceland’s unions got the opportunity to vote on a collective bargaining agreement worked out between the Confederation of Icelandic Labour Unions (ASÍ) and the Confederation of Icelandic Employers (SA). At the heart of the issue were wage increases for the lowest paid workers. SA maintained —and still stands by the position— that wage increases beyond 5% for the lowest paid, and 2.8% for everyone else, would unleash inflation across the country. They even bought a TV spot to repeat this point. Many companies pre-emptively raised their prices; some of them still haven’t lowered them. The ploy is not only transparently false —profits in the billions of krónur at some fishing companies, for example, could put to rest any fear that new money would have to be printed to fund a pay rise— it is also a very, very tired refrain that management has been singing for generations. In fact, studies conducted at the Economics Department at the University of Leicaster from 2004, 2006 and 2008, show that an increase in minimum wage does not significantly increase inflation. But that’s a lesson we’ve already learned, and will apparently have to keep learning. SA added insult to injury by proposing a tax plan that actually benefited higher income-earners more than those making the lowest wage. By their offer, a person making 246,000 ISK per month will see 8,000 ISK more per month, before taxes, and no rebates on their taxes. At the same time, another person making 1 million ISK per month will get an extra 28,000 ISK per month, plus 3,500 ISK taken off their monthly taxes. Amazingly, ASÍ President Gylfi Arnbjörnsson argued in defence of this agreement. Maybe a 1.2 million ISK monthly salary has a way of distancing you from the experience of making ends meet on about 190,000 ISK. Part of the apologist rhetoric that has been used about this agreement —from amongst others, editors of daily newspapers— is that it is meant to be temporary, to last only a year, so why fight over the terms now? To go by the daily chatter, it seemed almost a foregone conclusion that the contract would sail through. When voting was done, however, over half the labour unions in the country —17 against and 14 in favour— rejected the agreement. How? I would speculate it’s because, to anyone who’s been paying attention, there is no such thing as “temporary” when it comes to this lie about wage increases. Even after this result, SA is still repeating it. Another thing that tends to happen, when management digs in its heels at times like this, is that workers organise. Most of the unions that voted against the agreement turned out in larger numbers than those who voted for it – which would only make sense when the best enthusiasm anyone could work up in support for such an offer is resignation. When faced with such a situation, workers can, and quite often have, walked. Let us not forget that SA did more than refuse the reasonable demands of working people. It engaged in a concerted PR campaign to sell its inhumanity as common sense, while heads of business blatantly extorted people with price scares. SA might soon find itself learning a lesson of its own when it comes to the historic response this elicits in people who need to earn a living wage. The result of this collective bargaining vote may indicate a new wave of solidarity unionism in Iceland’s labour movement. There is clearly a core of workers motivated to push back, and if ASÍ leadership can’t represent them, they don’t seem to have a problem representing themselves. Past precedent can attest to numerous instances of even larger numbers organising effectively. In order for Iceland to awaken from its inequality nightmare, such a new wave will most certainly have a part to play. Management is, ironically, helping ensure that it happens. Read more: Unions Accuse Management Of Misinformation