The Socio-Economic Prospects of Thailand

Under the Rule of

Monopolistic Capitalism

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Somyos Pruksakasemsuk

Center for Labour Information Service and Training (CLIST)

Bangkok, Thailand

The Thai-Rak-Thai party-led coalition government, representing the vast interest of the monopolistic capitalism in Thailand, appears to be enjoying more political stability than successive previous governments. Having gained an overwhelming majority in the House of Parliament based on a populist political platform, the Taksin Shinawatra's administration has launched an aggressive bureaucratic reform, which helps consolidating his political power in a short span of two years.

Being a leading telecom tycoon in the country, Prime Minister Pol. Lt. Col. Taksin Shinawatra has introduced a series of economic stimulants, claiming to be part and parcel of his new economic approach to revive the country's staggering economy resulted from the 1997 economic crisis. The current regime has been injecting hard case allocated from government budget into the agricultural sector, encouraging consumers to spend more while promoting agro-business production and/or rural community-based production. But these economic programs have inevitably been heavily criticized by some quarters as "cheap politicking tricks" or "mass propaganda" designed for political gains or "applying marketing approach to gain more votes", particularly to rally more political support from constituencies in rural areas. The current government is also known to have exercised it's influence over both government and private-own media for its political advantages over the opposition. All of these efforts have, to a greater extent, helped the ruling party to form public opinions. Some critics have even claimed that the mass media in Thailand have been, by and large, bought off or "used" as a propaganda machine to misinform or mislead the public at large. Most importantly, the mass media have been effectively used as "tool" to discredit and/or undermine any political opponents.

To justify its attempt to consolidate its political power, the government has carried out its campaign to maintain "Law and Order" by enforcing a so-called "Social Order" in big cities. This has resulted in increasing cases of human rights violation, or violation of basic democratic rights of citizens to peaceful assembly, exercising their constitutional rights to voice their opinions and/or to file their grievances with the authorities. These recent developments include attempts to amend a number of organic laws to ban any protesters from demonstrating on the streets, by claiming that protesters and demonstrators must be banned from blocking streets or blocking traffic. In some cases, anti-riot police and/or commando units were deployed to disperse peacefully assembled rallies with force, where peaceful demonstrators were smashed and beaten with baton. The case in point was the violent suppression of protesters in the Southern provinces, where local residents demonstrated against the installation of gas pipeline project. Similar and severe measures were used by the authorities to disperse peaceful rallied staged by protesting workers on strike, demanding fair treatment and due compensations. Even the students, venting their angers against the government policies and mega projects, inhumane treatment of workers, were met with similar violent suppression.

All of these heavy-handed measures adopted by the government and authorities have quickly exposed the real image of a dictatorial regime, despite all the populist platforms and various reforms propagated by the Taksin-led coalition government. In essence, the present Thai government is no less dictatorial than the Malaysian government under the leadership of Prime Minister Mahathir Mohammad, which has managed to silent all opposition. The same is true in case of President Kim Dae Jung's government in South Korea, which has jailed militant trade unionists and dealt with protesting workers and labour movement with violent means.

To maintain his position of power and the political gains for the Thai-Rak-Thai party, Taksin's government has already began a rather sophisticated process of discrediting and undermining the civil society. The prime target being those NGOs committed to safeguarding the rights and benefit of the marginalized people, to stop further degradation of environment and natural resources and to struggle for the survival of the workers. It is an established fact that NGOs and Thai civil society have been highly vocal in vital issues ranging from human rights, labour rights, environmental protection as well as sustainable development at grass root levels for many years. Thus it came as no surprise that these organizations have been under attacks for aiding people opposing the gas-pipeline in the South and the Pak Moon Dam project in the Northeast. Under these circumstances, the current government in Thailand has decided that these organizations and their opposing views must be resolutely and firmly dealt with, most preferably to isolate them from the people. Strategically speaking, the labour movement and NGOs-working on labour issue have been at odd with the government all along, and inevitably seen as an obstacle to development in the context of monopoly capitalism under the big slogan of the so-called "Globalization".

On the economic front, the Taksin's administration has introduced a comprehensive package of economic revitalization program, paving the way to become a full-fledged monopolistic capitalism, claiming that this is the only way to become more competitive in the globalized market. The economic measures being implemented include direct injection of cash to the agricultural sector, in a form of "Village Fund", "Grace-period of Debt-ridden Farmers", "Transforming Asset into Capital", etc. The last scheme is supposed to be achieved by transforming a land-cultivation right into a proper land deed.

Although these programs may superficially seen as directly benefiting the peasants and farmers, but these schemes have not been conceived and designed to structurally address the poverty related issues, tackling the problems at the root causes. These schemes were not conceived and designed to structurally address the poverty issue from the first place. Definitely, there are not meant to close the cap between the impoverished poor in the countryside and the more affluent in the cities.

Worse still, the rural communities and the people in the countryside, surviving on the richness of their natural resources for centuries, have been denied their community rights to protect, preserve and manage their own community forest, rivers and hills and watersheds, etc.

So far, the much-publicized "Land Reform" has not been seriously implemented and carried out in earnest by any of the previous government, and this government is no exception. No genuine land reform has been realized. Even the hotly debated "Progressive Tax" system was a total shame. The House of Representatives has never passed any proposed Bill on Progressive Tax Collecting System.

As regards the plight of millions of workers in Thailand, their minimum wage has not been increased to meet their basic daily needs, whilst universal social welfare is still clearly inadequate. For the urban poor, their situation is a plain life threatening one, on a daily basis.

Thus, on the one hand, the budget allocating to the rural areas to generate agricultural production and handicrafts, aiming at stimulating more spending among the consumers, but the hidden motive is actually to generate marketing promotion for the monopolistic agro-industry, as well as the telecom giants. With more motorcycles and small pick-up trucks being sold like hot-cakes in the countryside, it has become clear to all that the automotive assemblers and auto-parts in the manufacturing chains are the one, who benefit the most from this policy formulated and implemented by this government. On the other hand, it has become an established fact that this populist platform and policy are meant to get more votes in the next general election, instead of aiming at dealing with the problems at the root causes.

In addition, these economic stimulants also have come in other forms, namely more and extended credit line and credit facility for real estate purchase and/or housing loans, toppled with lessening of once-stringent requirement for prospective credit-card holders. Last year saw a quick increasing number of credit card holders, even among the low-income people. Buying on credit seems to be the common practice nowadays, due to heavy promotion campaign launched by the government and commercial banks. However, these measures should only be adopted as short-term stimulants, not for long-term, sustainable growth stimulants. Encouraging people to spend beyond their means is a quickest way creating more debts for the people. It must be noted that all these developments being introduced without any serious efforts or concrete schemes to generate more savings. As far as the poor workers are concerned, this is not the way to increase or to create "real purchasing power", simply because the income earned by the workers and even the middle-class tend to be less and less. There is no clear sign that they could earn higher income under these economic situations.

The economic growth rate at 4.2 % being claimed by the current government is not at all convincing. In fact, it is not even consistent with the facts and figures officially released by the National Bureau of Statistics as follows:-

In 2002, the Household Income-Earning per Month increased by 5%, but 88.2 % of this 5 % increase was spent for basic consumption.

These figures simply indicated that no saving was feasible for these households.

Meanwhile, the same survey indicated that these same households carried 12.6% more debt per annum (comparing with the figure documented in 2000) reflecting the situations in all regions.

This observation was based on the fact that the monopoly capitalist government led by the Thai-Rak-Thai party has clearly neglected or has failed to raise the living standards of the people at the lower socio-economic strata, which include millions of working people. Many of which are relying on the meager, minimum wages. Although, the labour policy announced by the Thai-Rak-Thai party may reflect some commitment to address the lobour issues and solving disputes. But once the same party became the leading party in the coalition government, the TRT party has not only paid any attention to the workers' repeated calls for justice and constructive labour relations, but it has adopted a clear antagonistic attitude and suppressive position against the labour movement. In practice, the government has denied the basic democratic rights of workers to demand justice and redress. The Thai workers' voice must be heard, in principle and as enshrined in the 1997 Constitution, but the exploited workers in Thailand have met with various forms of obstacle deployed by the government, in more forms and essence than previous governments. These are some of the key impeding issues making it increasingly difficult for workers to effectively organize and voice their grievances.

In view of these recent developments, the ruling government may claim its success in collecting more tax, higher earnings from tourism, export promotion, and big cut in government spending (at the expense of social welfare and social security fund by refusing to duly contribute its share). As far as the government is concerned, these higher earning and budget cut have made it possible to pay back its huge debt to the International Monetary Fund, well before it is due. Another claim has also been made in achieving a 4.2 % economic growth. But the truth lies in the fact that these successes were made at the expenses of peasants and farmers having lost more land, loosing control of their own community forests and natural resources, etc. These rural poor have been robbed of their livelihoods, having been forced to leave their home villages to seek jobs in the Middle-Eastern countries and other countries in Asia. Women and young girls increasingly turned to prostitution both in Thailand and abroad, whilst workers facing more economic hardships, taking "speed pills" to work overtime. In deed, they have been systematically transformed into the 21 st century slaves.

Meanwhile, a handful of the super rich, the elite and the monopoly capitalists are the ones, who must be held responsible for the financial crisis and economic disaster. Their lavished lifestyles, consumption of imported luxurious products have directly linked to Thailand's huge trade deficit. This fact is indisputably shown in the latest import statistics; in Fiscal Year 2002, Thailand imported luxurious goods about 24,880 millions Baht.

To demonstrate this point, the followings are imported goods noted as top on the list:

Against these backdrops of lavish lifestyles adopted by the rich

and the privileged few, millions of workers have to be contended with meager minimum wages. Most of them have to rely on substandard living wages. The situation became worse when the slow and minimal increase of minimum wages are less than the constant rise of prices of basic goods in consumers' index. And the future appears to be bleak, when most enterprises decided to cut corners in everything. The workers are always the first ones to feel the pinch, whenever the bosses decide to resort to cost-cutting measures, lower the welfare and benefits of workers, etc. As far as the workers are concerned, the Taksin's administration has made their lives more miserable, a record low in living standards as categorically described below:-

1. Minimum Wages Since 1997, the successive governments have not raised any minimum wages corresponding to the actual economic situation, keeping the minimum wage to only 162 Baht per Day (in Bangkok and vicinity) and was minimally adjusted to 165 Baht per Day in 2001 against the workers' demand since 2000 to get at least 180 Baht per Day. The workers and the labour movement in Thailand had no choice but to continue their demand for realistic wages. The government did not decide to increase the minimum wage until January 2003 to 169 Baht per Day. But this latest minimum wage is not even a "living wage". The firm position taken by the labour movement is:-

A minimum wage for a single worker should be at least… 200 Baht / Day

A minimum wage for a married worker

(with one child or dependent) should be at least……………. 300 Baht / Day

The above minimum wages are seen as most basic requirement for workers to survive the current economic hardships.

2. Unemployment Insurance Ever since 1996, the labour movement in Thailand has been demanding for genuine "Unemployment Insurance", which for some reasons has been adopted as a part of "Labour Platform" publicly announced by the Thai-Rak-Thai party during the last campaign general election. But it turned out that the ruling party and the coalition government had dodged its own political commitment. The government has been stalling for time in coming up with a draft legislation for a long overdue "Unemployment Insurance". As a result, the Democratic Labour Alliance decided to stage a series of huge rally in front of the Government House, in 2001 and 2002, demanding the government to deliver what it had promised during the election campaign. But the government refused to heed the calls for a package of Unemployment Insurance, without regards all the preparations made at the implementation level at the Ministry of Labour and Social Welfare. So far, there has been no clear sign that the government would show any political commitment on this pressing issue.

Under these contracts and sub-contracts, workers are deprived of any due labour protection and benefits accorded to them by existing labour laws, simply because the employers are not obligated to bear any responsibility. Faced with this situation, contracted or sub-contracted workers are not entitled to, or deprived of their basic labour rights to organize and rights to collective bargaining. Currently, more and more employers have adopted outsourcing of labour under the pretext that they have to cut costs to be more competitive in free trade. But to workers, this only means one thing; the capitalists are completely free to exploit workers. Particularly, the government has granted many concessions and privileges to investors in the Export Processing Zones (EPZ) or Industrial Estates. This is why workers employed in EPZs and industrial estates are not allowed to organize their own unions, or not encouraged to organize at all. Worse still, more and more enterprises located in these EPZs and industrial estates have hired workers through contractors. Meanwhile, no political leaders seemed to pay any attention to the plight of workers being robbed of their rights to organize and rights to collective bargaining. Their voices have not been heard for an obvious reason; members of cabinet and their family business have also adopted this irresponsible practice of hiring workers through contractors.

4. Sub-standard Quality of Life for Workers Amidst the aforementioned rapidly changing socio-economic situations, the workers found themselves in constant difficulties. Having fled the poverty in home villages to workers' slums in cities, going through social transformation and adjustment, living from hands to mouth, etc. Coming from bad to worse situation, they found themselves greatly alienated in big cities. They are forced to work long hours. To make ends meet, they have to work overtime simply because the minimum wages are not real living wages.

Socially speaking, these workers do not enjoy any conducive conditions to live a normal family life. They do not even have enough time for normal, minimum 8-hour rest. Under these inhumane conditions, how could any worker have a healthy life, needless to say about having a warm, understanding and living family. It is no surprise that the divorce rate among workers have gone up, while increasing number of children being abandoned by their struggling parents. Children, who have been sent back to home villages to be with the grant parents and relatives, are considered lucky. But many other single parents, who have lost their land and livelihoods in the countryside, have no choice but to abandon their young. It is noted also that unwedded mothers, in industrial areas, have to either get abortion or kill their own newborns, as often reported in local media in recent years.

5. Dismissal of Trade Unionists and Undermining of Labour Movement in Thailand Recognizing that Labour Rights are part of Human Rights, the rights to organize must be recognized as basic human rights. Without the rights to organize, the workers have nothing to safeguard themselves against any form of exploitation. The workers’ organization is the only means to fight against inhuman treatment carried out by the bosses and employers.

According to the current Constitution promulgated in 1997, it stipulates that Thai citizens have the rights to organize and free to form their labour unions. However, the organic laws do not provide any genuine or effective legal protection for trade unionists against unfair or unjustified dismissal, particularly those potential union leaders, who have decided to take necessary initiatives to form their own unions. These leaders are in most vulnerable position to be dismissed, easy target for termination of employment, even before the union is properly and legally established. Many of these potential leaders have been victimized by the lack of inadequate legal mechanism to guard against any preemptive dismissal.

The recent celebrated case of TV reporters and Anchor Men and Women for the so-called ITV or Independent TV was a clear example of labour organizers being dismissed unfairly and unjustly. The only reason why these media professionals were dismissed wholesale was their decision to form a union. Subsequently, they decided to take the case to the Central Labour Court, seeking justice from the labour court. It took them over 1 year before the CLC ruled that the dismissal was illegal and ordered the Management to reinstate each and every one of them.

But the fight did not end so easily. The management refused to accept the CLC’s ruling and file an appeal in the Supreme Court of Justice (The Dika Court). If this is the case of simple workers or unknown trade unionists being unjustifiably dismissed, they would not survive a long and protracted court process or wait for the bosses to comply with the CLC’s judgement. They would have been dead from starvation within months. The legal mechanism and time consuming process are not designed to work in favour of the poor workers and potential union leaders.

In addition, the labour court system in Thailand has a number of flaws and riddled with corruption regarding nomination and appointment of the Associated Judges in labour courts. In principle, in addition to a professional presiding judge, any labour court would be required to have one Associated Judge representing employers and another representing employees. As it turns out, these adjunct judges are often products of questionable screening and selection process. The lack of transparency and accountability on part of most Associated Judges, supposedly representing workers, reflects the qualifications and competency of such Associated Judges.

For many years, the Nine (9) Labour Councils established in Thailand have managed to collide in nominating their own candidates, with hidden agenda. The nominations are generally seen as a form of “Bonus” for those who have vested interest in the labour federations or labour movement. To demonstrate this point, a recent newspaper report was filed on a case of “Associated Judge” had been gunned down by a “Hit Man” for possible involvement in illegal business. The dead man had a criminal record of being part of a drug ring.

Another point to note is the fact that previous governments had made some serious attempts to amend the Labour Relations Act, B.E.2518 (1975) essentially to undermine the labour movement, to weaken the bargain position of trade unions and most importantly to have stricter control of the labour movement as a whole. The previous government under Prime Minister Chuan Leekpai even came up with a new Draft and subsequently approved by his Cabinet. But it was immediately rejected and strongly opposed by the labour movement. The reason being the new Draft granted more power to the government to control and suppress the workers, limited the roles of trade unions and union leaders. If allowed to passed by the House of Parliament, the trade unions in Thailand would be banned from rending necessary support to workers on strike, or to rally behind any industrial actions taken by workers or to assist them until their demands are met.

At the moment, the said Draft is being scrutinized by the Council of State, the legal “Think Tank” serving as a pool of legal experts for every government. Many well-informed circles, including genuinely concerned and committed labour leaders believe that this Draft is likely to be submitted by the Taksin’s Administration to the House of Representatives and expected to be passed and promulgated as law in 2003.

6. Privatization of State Enterprises To serve the interest of global investors and to response to the demands of Multinationals, the present government in Thailand has accelerated its efforts to privatize its vital state enterprises, focusing on the most enterprising ones. In this area, the government has, by and large, achieved its objectives. The government actually seized the time opportunity when the state enterprise unions have been too weak to put up strong resistance up to now. Even the Coalition of State Enterprises’ Unions was not militant enough to struggle against this “wholesale privatization” of their own member-organizations.

On top of this, the government has categorically refused to do away with the 11 Acts, commonly dubbed as “National Sold-Out Laws” or “Traitors-Sponsored Legislations” without due regards for strong public outcry and demand for total revocation of the 11 Acts (drafted and legislated in compliance with the strict conditions imposed upon Thailand by the International Monetary Fund and the World Bank).

Prospects for the People

As described earlier, the economic revival package concocted by Taksin Shinawtra’s administration focuses on series of economic stimulants, accelerating consumptions, marketing expansion for export, tourism promotion, generous granting of special trade and investment privileges to foreign investors under the banner of trade liberalization and globalization. Conceptually speaking, the whole package is based on its firm believe that monopolistic capitalism is the solution to Thailand. The government and its pool of advisors and experts seem to be convinced that the national economy must closely linked with the multinationals, and must compete in the whole market, regardless of having to compete on even grounds or not.

It must be noted that this government’s choice is to inject massive funds into the rural and agricultural sectors, the meddle echelons of Thai investors and medium sized enterprises and the selected groups of monopolistic capitalist. The same groups, clans and circles of intestors and capitalists, who have been exploiting millions and millions of workers throughout the country, amassing enormous health and fortune from the blood, sweat and tears of the poor and marginalized. They have been working closely with the authorities in suppressing the mobilization of discontent workers, environmentalists, students, peasants and farmers. As far as the ruling cliques are concerned, the protesters and demonstrators are trouble-makers, unpatriotic elements, subversives and misfits, they have to be dealt with by force in order to sustain and maintain its power.

The ruling regime simply has no regards for the flights and sufferings of the workers in sweatshops and non-unionized factories and their families and relatives (peasants and farmers back in home-villages). Thus, the future of workers and the majority of the people in Thailand is quite dim, seeing no light at the end of tunnel. The prospects are quite dim and dark for workers and the labour movement. They are now bracing themselves for the worse to come.

As regards the labour movement as a whole, the government has made serious attempts to infiltrate and influence some elements among the leadership, particularly, some opportunists among the trade unionists at the national level. With the fragmented movement, it is quite convenient for most of them to be easily bought off. Instead of working and organizing to serve and protect the rights and benefit of the rank-and-files, these sold-out labour leaders have been trying to sabotage the solidarity network, trying to pacify the discontent workers and new generation of potential labour leaders.

Whenever the labour leaders in their payrolls have failed to control the unions and the movement, Taksin’s government have resorted to violent means to suppress the workers’ activities, campaigns and mobilizations, using the same old Fascist justification, for the stability of the government, economic development and growth and for the sake of “Law and Order”. The laws and rules referred to are the same outdated, undemocratic, dictatorial laws were designed, drafted and promulgated by the previous Fascist military governments, which were used to suppress any dissidents, workers, peasants and farmers who dared to struggle against any injustice dome to them.

Having stated and shared our views and perspectives, we are convinced that the economic recovery packages introduced and implemented by this monopolistic and capitalistic government is, at best, a shallow, superficial and pretentious PR campaign to buy votes, which can never achieve the highly publicized objectives even in a hundred years from now. How could any worker expect from the monopoly capitalists, the very same people who have been exploiting them for decades and accumulated enormous wealth and fortune, paving the way for them to become cabinet members and prime minister. Most likely, the workers would only get “lips service” and/or “false hopes” and nothing else.

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Somyos Prueksa-Kasemsook

Januray 3, 2003

CLIST , 01-8229477 

Email : clist@loxinfo.co.th