The recent controversy over a foreign-owned company running a US port brought attention to the creeping privatization of work in ports worldwide. The issue of foreign ownership hit a raw nerve in the continuing debate about security on US borders. Representative Harold E. Ford Jr. (Democratic-Tennessee) captured the fearful mood when he announced, “President Bush wants to sell this port [Baltimore]-and five others-to the United Arab Emirates, a country that had diplomatic ties with the Taliban, the home of two 9/11 hijackers, [and] whose banks wired money to the terrorists.”Footnote ¹

The United Emirates company, Dubai Ports World, appeared shocked by the heated reaction. Dubai Ports World had worked in tandem with British company P&O Ports to obtain the contract to run cargo terminals in Baltimore. Mark Montgomery, P&O senior vice president of East Coast operations explained, “We were a little naïve about the way American politics works.”Footnote ² The Dubai firm was but one of the new companies vying for control of ports around the world. Across the globe multinational companies in partnership with smaller companies have begun to dominate port operation. P&O Ports, for example, operates terminals in Great Britain and Australia, Argentina, Indonesia, the Philippines, China, Pakistan, India, Thailand, Mozambique, Sri Lanka, Belgium, and Russia. P&O Ports also shares partnerships with other national companies.Footnote ³

The privatization of the world's ports is not a new phenomenon. There has been a headlong rush to privatize ports Since the 1980s. The pace can be best described as rapid and chaotic. Privatization has multiple meanings. It could mean simply the transfer of state-run assets to private hands but with the state maintaining control over port development and security. It can also entail selling and giving up both assets and control. The myriad scenarios are daunting, depending upon local political and economic circumstances.Footnote ⁴ In either case a profound transformation has taken place where the nation-state has relinquished financial holdings and control. For some economists privatization is seen as a method to increase efficiency. After decades of government involvement in the port industry, it has been argued that the situation is ripe for change. Taking the state out of the mix, it is argued, releases the state from the day-to-day decisionmaking. Just as vital, privatization has driven away the financial obligation that many nation-states have been committed to.Footnote ⁵ Additionally, by selling the public enterprise the state can acquire substantial payments that can be immersed into government coffers.

But the process has substantial critics. For many privatization is perceived as problematic. There is evidence that the process does not indeed lead to savings and greater efficiency. Instead, the process has been haphazard and far from uniform in its application. Even where there is an entrenched presence, savings from privatization have yet to be realized. Others have made the point that the process cannot be transferred to ports in the developing world. That is, the multiplicity of ports and transportation problems in the interior make privatization more like wishful thinking than a policy that can work.Footnote ⁶

While market forces are touted as the cure for inefficient state stewardship, the case has not been proved. In some cases, decline is merely a case of geography and luck. Ports on the west coast of England have suffered from a shift of trade from the United States to Europe. The degradation of the ports of Liverpool and Bristol is not due to inefficiency; they are merely facing the wrong way. But even taking into account geographic explanations, economists Kevin Cullinane and Dong-Wook Song argue there is little empirical evidence to show that market forces can do a better job than government control. They argue instead that the process has “resulted from the idea that public policy on this particular issue is influenced much more by political philosophy and convenience than by the rigors of economic analysis.”Footnote ⁷ The rush to embrace Adam Smith by the Margaret Thatcher Governments (and others), was to rip away government ownership and control. This notion of control fits a strategy to reduce the influence of trade unions and thus deflate wage costs. Britain's dockworkers and the Transport and General Workers Union (TGWU) had wielded considerable economic and political power during the 1950s–1970s. Dock strikes were common throughout the second half of the twentieth century. Such strikes could cripple or threaten an economy heavily dependent on trade for its existence. The TGWU was seen by shippers, and port and government officials, as either an instigator of such conflict, or a worthless bystander. So for all the platitudes regarding efficiency, one of the main motivations was to contain union power while enhancing managerial control.Footnote ⁸

The process has also been resisted by dockworkers. They are positioned at the point of attack where their wages and working conditions are threatened by a vigorous push to cheapen costs. Privatization is seen as nothing more than an attempt to transform work and undercut trade-union power. In 1995-1998, Liverpool dockworkers fought a long hard battle against port employers over the issue of right to manage. The struggle captured the attention of trade unionists across the world and became both a symbolic and real battle between the global forces of multinational corporate power and port workers. The confrontation was but one of many episodes in the aggressive privatization of government industries and assets. It was only fitting that a dispute in Liverpool's docks would transform itself from a local issue to that of a global confrontation. It was in Great Britain that the ports were first privatized. Under Margaret Thatcher's Conservative Government a slew of state-run industries were privatized. And by the late 1980s this policy was expanded to the nation's ports.

When examining the theme of privatization one must first recognize that this is not a unique phenomenon. Throughout the nineteenth century most ports around the world were run as private entities with little government involvement. While governments might pay some attention to dock and port development and security, the day-to-day exercise of loading and unloading ships was left to individual firms and stevedores. Not until the twentieth century did workers manage to overcome employer power and gain some semblance of power on the docks. Throughout the western industrialized nations trade unions began their long march for trade-union recognition and power. By the beginning of the 1930s trade unions had established a stronghold on many of the waterfronts of the world's ports. In the US, for example, the International Longshoremen's Association (ILA) had secured control over Atlantic and Gulf Coast ports, while on the West Coast the International Longshoremen's and Warehousemen's Union (ILWU) predominated. Each union epitomized different union cultures, one more democratic than the other. Ultimately though, longshoremen on both coasts could boast of a semblance of trade-union protection.

The Second World War was another transformative period. European port workers embarked on a strategy to regain control of their working lives. Instrumental in this approach were friendly nation-states. In Great Britain, for example, the Labor Government passed legislation to decasualize the industry. Under the auspices of the 1947 Dock Labor Scheme, port workers were guaranteed work payments, even when work was not available. So attendance pay was given to offset lack of work. But such regimentation came at a price. Wage levels for different cargoes and working conditions had be bargained through local dock labor boards or the National Dock Labor Board. This institutionalizing of the work and bargaining process alienated many dockworkers. Their sense of localized power was threatened by the apparatus of local and national boards. Such estrangement led to reoccurring battles with not just the labor boards but with their union leadership as well.Footnote ⁹

Throughout the 1950s and 1960s a series of wildcat or unofficial strikes whacked the industry. Each attempt by respective governments (both Labour and Conservative) and the labor boards to rein in the dockworkers led to further instances of confrontation. Troops unloading perishable cargoes were a common sight on the London docks. This cycle of unrest made many on the right and center ready to change the system of industrial relations on the nation's docks and ports.

Beginning with Margaret Thatcher's electoral victory in 1978, the newly-formed Conservative Party embarked on a policy of privatization. Industries such as British Telecom and British Gas came under the auctioneers' hammer. Such a policy was welcomed by many economists as a way to streamline nationalized industries and bring the order of market forces into play. Echoing Tory Government concerns the argument was made that to privatize was to liberalize the economic system. Thus the sale could have a series of beneficial effects. The sale of government assets could add badly-needed funds to the government's budget. Private control was also equated with efficiency; dismissing lackadaisical state managers in favor of their private counterparts would usher in more refined forms of managerial control and function.Footnote ¹⁰ Much was made also of allowing dockworkers to become shareholders. Democratizing ownership, through the sale of shares to workers, would financially invest workers in their respective enterprises. However, a more important but understated purpose was to do away with machinery that protected workers' jobs and workers' rights on the job.

After successfully privatizing a group of nationalized industries, the Tory government turned its attention to the nation's docks and ports. It was clear that Great Britain had a surplus of ports and those new technologies of containers and roll-on and roll-off initiatives had changed the work landscape. In 1989, the government sold off Sealink and other maritime assets. Clearly the Conservative government wanted to repeat its earlier successes with gas, oil, and telecommunications. Correspondingly, nationalized ports were sold off and series of new companies were formed to run the nation's ports.Footnote ¹¹

While the privatization process was underway the government went one step further and dismantled the National Dock Labor Scheme. In one fell swoop on July 3, 1989, job protection and union scales were swept away. Although not explicitly part of the privatization process, the dismembering of the Scheme gave management and owners the weapons to rein in worker control. As one private port official put it: “For many port managers, July 3, 1989 became the first day of rest of their lives. No longer would they have to put up with such infamous restrictive practices as ‘bobbing,’ or ‘ghosting’ or ‘welting.’ No longer would they have to acquiesce to dictates from Transport House [TGWU headquarters]. At last they became managers of their own destinies.”Footnote ¹² Managers used the new set of relations to demand new forms of contract labor. Dockworkers now had to sign “flexible” contracts that forced them to work where and when managers demanded. Overtime restrictions were tossed out, and in some cases, overtime payments were done away with. Union strongholds like London were dodged by focusing on Tilbury and other ports like Felixstowe. Although the rationale was that each of these ports had deep-water facilities to handle larger container ships, the bypassing of London made the transition to privatization that much easier. In sum, 6,500 dockworkers were made redundant.Footnote ¹³

The process of privatization in tandem with the abolishing of the National Dock Labor Scheme was virtually completed by the late 1990s. In Liverpool the new owner was the new corporate entity, the Mersey Docks & Harbor Company (MDHC). This pattern was followed in Southampton. Southampton dockworkers attempted to gain control of hiring by buying shares with management following the 1991 Ports Act. Unfortunately they were forced to sell their shares at £2.50; ultimately the company was sold to MDHC for £38 a share. Thus the notion that dockworkers would share in the benefits of capitalist ownership disappeared.Footnote ¹⁴ But it was ports like Felixstowe and Tilbury that ushered in a new set of relations. Both ports had weak trade-union traditions. Indeed, London dockworkers were generally suspicious of their brothers in Tilbury, labeling them “turnip bashers” or “carrot-crunchers” due to their rural and conservative leanings.Footnote ¹⁵ These ports were taken over by private entities ushering in new regimes of control. Correspondingly, wages were cut. The working process was also transformed. Managers demanded flexibility in the new contracts, which entailed “longer hours, shorter breaks, lower manning levels, unrestricted flexibility, and the compression of several job categories.”Footnote ¹⁶ Many veteran dockworkers refused to accept the new regime and accepted “voluntary” redundancy. Although losing a sizable section of their skilled workforce, managers reasoned that in the long term their greater control would provide larger dividends.

In Liverpool, such a managerial philosophy clashed with a restless workforce. The Liverpool dockworkers remained members of the TGWU and were wiling to fight to maintain their limited control over the work process. It was this attempt to maintain control that provided the spark for the 1995–1998 confrontation. On September 25, 1996, a gang of dockworkers were informed they would be working overtime to finish loading a ship so it could sail on time. Although the decision came late in the day, what was most inflammatory about the situation was that the gang was told they would be not be paid the established overtime rate. When they turned to shop stewards for guidance they were fired. In turn, the gang set up pickets and other dockers refused to cross. Ultimately, the entire dock force of 500 men was summarily dismissed for breach of contract. For the locked-out men, the dispute was seen as a managerial attempt to eradicate the union presence and to effect a casualization of the workforce. As one dockworker leader pointed out, the intention of the employers was to use the dispute as a “wedge of casualization.”Footnote ¹⁷

Because this dispute was over secondary action (the dockworkers' refusal to cross a picket line), it was clearly unlawful under existing labor law. The TGWU therefore could not make the strike official for fear of damaging financial penalties. So from the beginning the dispute was an unofficial one. This situation was not necessarily unique. Most dock strikes in the postwar era were not sanctioned by the TGWU. Indeed, there was tradition among British dockworkers of taking unofficial action, even to the extent of ignoring their union leaders' calls for a return to work.Footnote ¹⁸ The Liverpool strikers immediately began to organize a fighting organization. The strategy encompassed both a local and international perspective. Throughout the Liverpool area (Merseyside) they sponsored marches, rallies, forums, and fundraising activities. Collections were regularly taken in Liverpool's shopping centers. Critically supporting this activity was the Women on the Waterfront group (WOW). Made up of dockworker wives, WOW was instrumental in gathering financial donations and speaking to potential supporters around the country, and appearing on local and national radio and television. They even took the dramatic step of picketing the homes of MDHC directors and managers, and during the Christmas of 1995 they sang carols to the occupants. WOW members also spoke before the Trades Union Congress and the TGWU in a vain effort to garner their official support.Footnote ¹⁹

The lack of support by the TGWU and the International Transport Federation forced the organizers to look further afield for sustenance. Soon the organizers were calling on dockworkers worldwide to support their cause. Trips were made to the United States, France, Belgium, Spain, Sweden, Canada, Australia, and New Zealand. By internationalizing their struggle, the Liverpool dockworkers hoped for concrete support. Indeed, they got it. International dockworker unions gave generous financial donations. Just as vital, they also engaged in sympathetic action. Those shipping companies that continued to use the Liverpool docks were targeted. In Denmark, France, Sweden, Australia, and the East Coast of the United States, dockworkers refused to work ships or engaged in slow-down work. By successfully internationalizing the dispute, the Liverpool dockworkers had garnered much-needed moral and financial support.Footnote ²⁰

Indeed the success of the international effort has led many to pose the action as a template for future action. The transnational focus is hailed as a tactic to glean support and put the offending companies on the defensive. Authors such as Richard Hyman and Kim Moody have put forward the argument that workers, with or without union sponsorship or encouragement, should engage their multinational adversaries on a global scale. Thus to counter globalization and its attendant powers, workers need also adopt a global perspective.Footnote ²¹

The issue is not so clear-cut, however. The Liverpool dockworkers basically lost their fight and they were forced to accept redundancies in January 1998. This was not necessarily a failure of international collaboration, but rather that the dispute was not officially sanctioned. Correspondingly, the dockworkers and their families had little local or national institutional support. As for the international solidarity displayed, both economic and moral, the limited actions by dockworkers worldwide were ephemeral. The slowdowns in foreign ports did just that; slow down the movement of shipping. But the actions were few and short-lived. It was at the local level that support was keenly felt. It was the wider community support that brought in larger amounts of badly-needed cash. The day-to-day contacts with supporters and allies enabled the dockworkers and their family members to survive the twenty-seven-month-old dispute.

Perhaps too much has been made of the critical nature of international solidarity. In the case of the United States, the picture is riven with localism and strength. Both the International Longshoremen's Association (ILA) and the International Longshoremen and Warehousemen's Union (ILWU) still dominate the nation's ports. Because the ILA and ILWU hold such strategic power, employers and shippers cannot easily bypass their areas of strength. On the West Coast, for example, there are no other ports that shippers can use because all are organized. The same applies with the ILA. Their dominance on the East and Gulf Coasts ensures their survival and continuing strength.Footnote ²² This is not to suggest that international action or solidarity has no value. It is a tactic that can effectively shore up striker morale, but until the international workers engage in sustained, sympathetic strike action, solidarity is merely a supportive function. In the case of the Liverpool dockworkers, they turned to international support only after their union refused to actively get involved in the strike. In a sense, then, the turn to the international was a reactive effort.Footnote ²³

The key to the future is perhaps an amalgam of all trajectories. When confronting a global economic entity it makes sense to turn to the international arena for support. But it is at the local and national levels where conflicts will finally be resolved. It is one thing to express international solidarity in terms of resolutions and financial donations, but quite another for national groups to engage in sustained, direct action. The increasing global privatization of ports ensures that workers have to think and act internationally. But until an issue simultaneously affects the world's dockworkers, the local will predominate.