[Mayworks-org] 'Living Wages and Union Organizing' The Bullet, March 13, 2007

The Bullet lists at socialistproject.ca
Tue Mar 13 19:01:53 PDT 2007


~~~~~~~~~~~~~~~~(((( T h e B u l l e t ))))~~~~~~~~~~~~~~~~~

A Socialist Project e-bulletin .... No. 45... March 13, 2007

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Income Inequalities, Living Wages and Union Organizing

It is now accepted across a wide spectrum of political thinking that
the period of neoliberalism has sharpened income inequalities. This
has occurred along a number of dimensions. The capitalist class has
seen an increase in wealth from an increasing concentration of assets;
a rapid run-up in asset prices; and corporate profits having been
restored to historically high levels. Some professional classes,
particularly in the massive financial, legal, accounting, and
management bureaucracies that have grown along side neoliberal
globalization, have shared in this surge of incomes.

In contrast, for the broad swath of salaried and waged workers there
has been general wage compression. This compression has slowly crept
into the strongest sectors of the economy, notably Canadian
autoworkers have moved in the direction of concessions bargaining,
though productivity remains high, the value extracted from workers
enormous, and government subsidies vast. At one time the leading force
against concessions bargaining in Canada, the CAW leadership is now
regularly helping rewrite contracts to accommodate wage and work rules
concessions, enabling the auto companies to whipsaw its membership
from Oshawa to Windsor to Brampton, and back again. It is hard even to
recall when CAW last led a major struggle or strike against the auto
companies.

In weaker sectors, pattern bargaining has long been broken, and wage
compression and dispersion even more extreme. In the bottom tranches
of the labour market, precarious work, high unemployment and the
breaking of the link between minimum wages and median wages has added
to the numbers of the working poor. And, in a further effort to spread
labour market insecurity and bolster profitability, neoliberal
policies have actively rolled back the relationship between welfare
rates and average income levels. This labour market dynamic has
intersected with, and furthered, racial and gender stratifications
across Canadian society.

This is a shorthand description of the social processes of capitalist
accumulation shaping income distribution today more generally. In
Canada, wage pressures have been impacted by continental processes
since NAFTA. Such wage compression has encompassed both the U.S.,
where they have been just as severe as in Canada, and Mexico, where
the crisis of living standards and work for the Mexican working
classes cannot even be compared with the other two. Mexico fits within
the general patterns of income distribution across Latin America under
neoliberalism of stagnant or falling per capita incomes for some two
decades, 70-80 % of new job growth in the informal sector, and half
the population living in poverty. 

In this context, it is imperative that the left get behind living
wage campaigns as one aspect of a response to neoliberalism. The
labour movement in Canada has been supporting a $10 minimum wage with
key campaigns occurring at the Federal level, in B.C., in Ontario and
in Toronto. Other campaigns are also directed at addressing welfare
levels, as in the 'Ontario Needs A Raise Campaign' of the Ontario
Social Justice Network and the Ontario Coalition Against Poverty's
'Raise the Rates' mobilization. In the U.S., there have been numerous
successful living wage campaigns targeting the municipal level. And
the economic crisis in Mexico has new emergent sections of the labour
and social movements coming together to call provocatively for a
'continental living wage campaign'. A key political question is how to
link these campaigns up, and particularly not to separate campaigns
for minimum wages apart from ones for welfare rate increases. There is
a significant opportunity opening up to unite these struggles and
forge major political mobilization across Ontario, Canada and North
America in the coming months. 

A central component of successful class struggles for living wages
rolling back the obscene income distributions of neoliberalism will be
union organizing. The Bullet publishes here two articles addressing
the issue of living wages in terms of organizing in the hotel and
retail sectors, and the recent press release of the CLC supporting the
federal minimum wage struggle. 

*********************************************************************

*********************************************************************

Hotel Workers Lead the Struggle to 'Upgrade' the Service Economy

by Sedef Arat-Koc, Aparna Sundar and Bryan Evans

In the years preceding and immediately following the Second World
War, the trade union movement served to transform work and life for
industrial workers and their communities by creating the means to
bargain for better wages and working conditions. Now, in the first
decade of the 21st century, North American hotel workers are engaged
in a key struggle to transform the quality of work and life in the
service economy.

The hotel workers are represented by UNITE-HERE which launched the
'Hotel Workers Rising' campaign in December 2005 with the active and
very public support of actor Danny Glover who linked the necessity for
supporting the struggles of low wage workers. And it is more than low
wages at the centre of this struggle. The intersection of race and
class in the hotel industry is anything but ambiguous. The higher-end
front-line positions which also allow for career progress are
invariably staffed by white workers. The back-room, largely dead-end
positions are reserved for black workers and immigrants. The
statistics make clear the racialization of hotel work where fully
seventy per cent (70%) of hotel workers are immigrants and fifty-two
per cent (52%) are visible minority. The median wage for Toronto hotel
workers -- union and non-union - is $26,000 per year. Not exactly a
princely sum in one of Canada's most expensive cities. Median hourly
wages run from $10.48 to $11.22, depending on the type of job. The
union factor is significant as unionized workers average $14/hour -- a
differential approaching 40 per cent!! Working conditions are a 21st
century Dickens tale characterized by intensification of work, a lack
of job control and consequently, soaring injury rates.
Musculo-skeletal Disorders (MSD's) are amongst the highest in any
industrial sector as a result of the volume of heavy lifting required
especially among hotel housekeepers. In one massive study of 40,000
hotel employees found that injury rates were increasing as hotels
added heavier beds and room amenities such as treadmills. 

The Hotel Workers Rising campaign is creative and enthusiastic. Its
actions and events are heavily attended by not only hotel workers but
their families and community allies. It isn't so much a campaign as a
social movement which looks and feels like it not only central but on
the winning side of change. And it is! This success is no doubt in
part the result of the campaign vision and strategy to link these
industry issues to larger questions of what kind of quality of life,
what kind of society and economy do we want to have in Canada and in
North America? Hotel Workers Rising explicitly links their efforts to
the Toronto Labour Council's Million Reasons to Take Action campaign
which seeks to mobilize around the damning fact that one million
workers in the greater Toronto area earn less than $30,000/ year.
Again, the racialized dimension in these numbers cannot be lost as
many of these underpaid and undervalued workers are people of colour
and new Canadians. The Labour Council's campaign ask, as does Hotel
Workers Rising -- are we willing to leave these people behind and if
so what kind of society will we have built. The lesson of these
campaigns is honest and true -- when workers and their families can
lift themselves out of poverty, then they and their communities become
better places to live. 

The battle Hotel Workers Rising has chosen to fight is nothing less
than a direct and open challenge to the practices of neoliberal
restructuring and the logic of global hyper-competition. In the hotel
sector, the forces of globalization have forced a rationalization
within the hotel industry which is increasingly populated by a handful
of multinational chains -- Hilton, Starwood (Sheraton, Four Points,
Westin, and Le Meridian), Marriott, Fairmont (Delta), Intercontinental
(Crown Plaza, Holiday Inns) to name the more prominent ones. The hotel
sector, as with the service sector generally, confronted by the issue
of productivity. It requires human labour and skill. Technology can do
little to extract more profit in this sector. Instead, profit can only
be increased the old fashioned way -- through extreme exploitation of
labour. And hence, the macro political problem the hotel workers and
UNITE-HERE have chosen to take on: how to better distribute that
profit, as a beginning basis to increase workers' power beyond
profits. It's not an abstract problem.

Between 1981 and 2001 the poverty rate for immigrants in Toronto
increased by 125%. So much for a rising tide lifting all boats! The
1990s were a decade if decline and stagnation for most Canadians. The
worst since the Great Depression. In that bitter decade incomes of
two-parent families dropped 13% in real dollars. The plight of
single-parent families was, of course, worse. Their incomes dropped
18%. As of 2005, 35.1% of Toronto's children lived in poverty. A
disgusting fact given that the economy has never been more robust in
creating wealth. In 2004, corporate profits reached a all-time,
historic high composing 14% of the Canadian GDP. And all this while
our modest welfare state continues to shrink and restrict benefits.
For example only 26 per cent of Toronto's jobless are even eligible
for Employment Insurance. Again, this speaks volumes as to the
importance of the hotel workers campaign to lift living standards
throughout the service economy. 

To advance the 'high road' vision of the campaign, UNITE-HERE has
taken over the past months 14 strike votes in Toronto area hotels and
garnered an astonishing 98% strike vote. The strategy has been to set
in motion co-ordinated sector-based bargaining. Victories have been
achieved at the Downtown and airport Hilton and at the Sheraton
Centre. The Delta Chelsea Hotel however is attempting to break the
pattern being set by the union and have drawn a line. In particular,
Delta Chelsea management is actively courting owners of some 25 new
hotel projects now in the planning stage for Toronto to stop the
union's progress at the bargaining table. Other unions which
frequently do business with the Delta Chelsea -- notably the Ontario
Public Service Employees Union, the Canadian Union of Public
Employees, and the Power Workers Union (Ontario hydro) are currently
boycotting the Delta and have cancelled a number of contracts with
that hotel.

This workers' movement harkens back to the great struggles of the
Committee of Industrial Organizations which grew through the 1930s and
1940s. A movement which transformed the lives of workers and the
communities in which they lived. The Hotel Workers Rising campaign has
the potential to do the same, to transform our times -- a trade union
movement for the 21st Century, if you will.

Sedef Arat-Koc, Aparna Sundar and Bryan Evans teach at Ryerson
University, Toronto.

*********************************************************************

*********************************************************************

Challenging Wal-Mart

by Herman Rosenfeld

Raising the minimum wage and increasing the level of social
assistance is a component part of challenging the large, low-wage
multinationals that make up the vast majority employers of the working
poor. The largest of them all is Wal-Mart.

For socialists, Wal-Mart is more than just a series of big retail
stores that threaten our communities, bringing an orgy of consumerism
and traffic jams. The discount retailer represents, in the words of
American social scientist/historian Nelson Lichtenstein, "the template
business, setting the standards for a new stage in the history of
world capitalism.... It stands for a new set of technological
advances, organizational structures and social relationships." 

How does a series of retail stores, play the kind of role in today's
society, that Microsoft, General Motors, U.S. Steel and the railroad
monopolies played in earlier epochs?

Wal-Mart is huge. In 2004, its yearly revenues represented 2.3% of
the total economic activity of the United States. It also did 20% of
the retail toy business and 14% of all grocery sales in that country.
Its yearly revenues are larger than those of Switzerland. If Wal-Mart
was an independent country, its economy would rank 30th in the world,
right behind Saudi Arabia. 

It is the largest profit-making enterprise in the world. It has sales
of over 300 billion dollars a year and it is predicted that Wal-Mart's
annual sales will soon reach 1 trillion dollars. A study by a leading
U.S. corporate consultant firm in 2002 argued that one quarter of
American productivity gains from 1995-1999 were due to Wal-Mart.
Wal-Mart is the world's largest retailer. By 2003, it had also become
the world's largest grocer. 

In Canada, Wal-Mart entered the market in 1994, purchasing 122 stores
previously owned by Woolco. Wal-Mart is now the largest retailer here.


Wal-Mart's size means that it shapes the retail market in the U.S.
and many other countries and since the hollowing out of the
manufacturing sector, it plays an inordinately influential role in the
economy. 

Discount Retail Model

Discount retailing is based upon a simple set of principles. Goods
are sold at the lowest possible price, with very low mark-ups over the
actual cost of production and with an extremely fast rate of turnover.
This places enormous pressure to lower costs at every stage: in
production, distribution and in the process of retailing. Wal-Mart has
perfected these principles.

Retailing had always been cost sensitive, but discount retailers were
particularly driven by cost reduction. The discounters emerged after
World War 2, offering large selections of cheaper goods, with stores
accessible by car, located off suburban highways. In contrast with the
older department stores, located in city centres, the discounters used
non-skilled, non-union labour, with shopping done on a self-serve
basis. 

There were huge numbers of discounters during this period and by the
1980's recession many of these companies had folded. Wal-Mart
originated in the Ozark mountains of Arkansas -- a very conservative,
small town atmosphere in the 1960's. Rather than attempt a rapid
expansion, Wal-Mart perfected its model in the friendly confines of
that part of the U.S. and developed a plan for growth across the USA.

In 1987, Wal-Mart was a successful regional retailer. Five years
later, it had become the industry leader. Its dominance came from its
adoption and application of information technology to the handling of
goods and people; its control over suppliers; its strategic approach
to growth; its global reach; ruthless labour practices and its ability
to benefit from the wave of neoliberal regulatory and cultural changes
that occurred during its growth period. 

Globalization, Supply-Chain Dominance and Sweatshop Labour

A key component of Wal-Mart's strength is its dominance over
suppliers. This reverses the historical dependence of retailers upon
manufacturers. 

Wal-Mart is a monopsony in relation to the supply chain -- that is,
it is the overwhelmingly dominant market for the manufacturers'
products (for many, it is the only retail outlet). It shapes the
structure and location of manufacturers, forcing them into the same
low-wage, low-cost system as the retailer. It dominates supplier
production and logistics. The sweatshop empires of Nike and some of
the clothing companies are miniscule compared to Wal-Mart.

Manufacturers have become dependent upon Wal-Mart's ability to market
their goods -- and must respond to Wal-Mart's requirements. Wal-Mart
stores are the biggest marketing channel for consumer products in the
world and the 20 million customers who shop there on an average day
represent a bigger market than could be reached by traditional mass
media advertising.

Wal-Mart demands low prices, a "pull" (production of goods in
response to a closely monitored system that predicts the likely
customer demand) and "just-in-time" delivery of goods. Suppliers must
make their production and delivery system "transparent" (which
Wal-Mart is able to force on them through the use of electronic forms
of data and inventory control). Wal-Mart sets up its own distribution
apparatus as well, replacing wholesalers. 

Wal-Mart tells suppliers how and where to produce their goods. They
are forced to locate overseas, seeking sweatshop labour to meet
Wal-Mart cost and delivery requirements. This, in turn, also creates
new logistics and transportation systems. It's no accident that today
Wal-Mart imports more goods from China than either the United Kingdom
or Russia. 

This has both contributed to and resulted from a new spatial division
of labour: 'developed' countries lose manufacturing, but the role of
low-wage retailing and distribution increases. Wal-Mart increases
'de-industrialisation' and precarious work. 'Developing' countries
have sweated manufacturing, exporting to retailers in U.S. and Europe.


Wal-Mart would never have been able to develop this way without the
corresponding advent of capitalist globalization and neoliberalism.
The ability to move production across borders at will in response to
cost signals makes this possible, as does the destruction of the
socialist-oriented balanced developmental models that used to exist in
China, Vietnam and partially in India.

Working at Wal-Mart

At the centre of the Wal-Mart's commitment to "everyday low prices"
are low wages and a system of labour control. This involves an
intrusive hiring process, wage scales that are lower than other big
box stores (individually assigned in secret from other workers),
arbitrary hours of work (where "full-time" can mean as few as 20
hours), forcing people to work "off the clock" (not paying workers for
hours worked), a precarious workforce, intense surveillance in the
workplace, rampant gender discrimination and a centrally-controlled
anti-union policy. 

Managers formulate labour budgets that must be approved from Wal-Mart
headquarters in Bentonville. They always run with too few resources,
so that there is always pressure to cut labour costs. (Managers are
told that Sam Walton always carried around a "beat yesterday" book
that keept track of cost cutting improvements on a regular basis). 

There are many facets to Wal-Mart's anti-unionism. There is the
company culture which seeks to create a "family type" atmosphere with
the paternalistic Sam Walton making sure that workers' well-being is
being looked after; workers are called 'associates'; an "open door"
policy promises a sympathetic hearing of individual concerns; profit
sharing, for those above a certain wage scale; daily meetings where
cheers are recited and successful products are touted. There is
anti-union propaganda in videos and DVD's, portraying workers'
organizations as parasites that are jealous of Wal-Mart's success.
Finally, there is the repression of potential union drives by
management. This, too, takes a number of forms such as close
surveillance of the social interactions between workers, swift action
by central authorities in Bentonville when there is any danger of
union drives, and co-ordinated efforts to smash unionization drives
once they are started. In 2005 Wal-Mart closed its Jonquiere, Quebec
store, rather than bargain a first North American collective
agreement.

Wal-Mart's size and domination of retail markets help it to influence
wages and working conditions and rates of unionization of society in
general, as well as the sector. The very threat of Wal-Mart's entry
into grocery retailing has given unionized employers a weapon to use
against workers. The largely unsuccessful California grocery workers
strike, where 70,000 workers went out for 140 days, was waged against
efforts by unionized employers to match Wal-Mart's labour costs and
practises. 

Wal-Mart's Vision

Wal-Mart helps usher in (and reflects) a particular social and
political model: Low consumer prices serve a low-wage economy. As
Wal-Mart CEO Lee Scott claims, "Low prices give people a raise every
time they shop with us").

It portrays the giant capitalist as a champion of the "little
person", reinforcing people's identity as consumers (shoppers) and
cancelling out people's class identity. It claims to cater to the
particular needs of women as caregivers and as the main shopper in the
family (over ½ of which are single parent families in the U.S.), all
the while reinforcing the crassest forms of sexism and paternalism. 

Wal-Mart can't be explained without the neoliberal economic and
political reforms of the 1970's and 80's. The pool of low-wage workers
(many of whom are women) and the extra responsibilities facing women
made Wal-Mart possible and attractive. Government deregulation of
labour markets and the loss of high wage manufacturing jobs also
contributed. The rise of consumer culture and Christian conservative
values in the U.S. also played a role.

How Do We Challenge Wal-Mart?

The first question to ask is, what should be our goals in challenging
the retail giant and what outcomes do we want? Second, we should ask,
what are the most effective ways of accomplishing them? 

Should we consider trying to close them down? Aside from being
totally unrealizable, this option ignores the very real need that
ordinary working people have for reasonably-priced consumer goods,
available in conveniently-located stores. Wal-Mart has withdrawn from
South Korea and Germany, but this isn't because the people there
demanded that they be kept out. They left because, in the German case
at least, they couldn't tolerate the demands of the unionized workers
and a larger culture which didn't place low prices at the apex of
society's values. 

Should we consider breaking it up through anti-trust action? This was
a solution considered in a recently published article in the U.S.
monthly Harpers. An American-type solution, it doesn't make sense when
applied to a retailing giant. After all, it would only increase the
competitive pressures on a series of smaller, discount retailers. On
the other hand, it might be a way of addressing Wal-Mart's monopsony
power in relation to its suppliers.

A particularly radical approach would argue for nationalizing it and
running it as a series of co-operatives. While this would preserve the
economies of scale and the application of technology to lower costs,
it is certainly utopian in the current context. Such an approach might
only work if we were involved in a larger social movement challenging
capitalism and its logic.

That leaves us with modifying the Wal-Mart model, accepting the
existence of discount, mass retailing, but changing it in a way that
radically improves the conditions in supplier and Wal-Mart workplaces,
provides for unionization, forces them to source locally and stop the
destruction of local communities and environments. 

Can Wal-Mart afford it? Just looking at fair wages and benefits, they
certainly could. If Wal-Mart spent $3.50 p/h more for wages and
benefits for full timers, it would cost $6.5 billion per year -- less
than 3% of sales. Wal-Mart claims it would wipe out profit or its
"price advantage" over competitors. As a recent Wal-Mart ad crowed,
"We'd betray our commitment to tens of millions of customers, many of
whom struggle to make ends meet". (Costco pays $16.00 p/h -- 65% more
than W-M average and 33% more than Sam's Club. Costco also covers 82%
of its U.S. workers with health insurance, while W-M covers only 48%
of its workers.)

What Are Some of the Ways to Force Wal-Mart to Change? 

Most important is unionizing them. But current attempts are hardly
adequate. It's not that there isn't a potential base for organizing
the retailer. In the last few years there have been some near
successful drives, and just recently there was a mass walkout in a
Florida store over hours of work.

Wal-Mart will never be unionized by scattered efforts to organize
individual stores. Organizing Wal-Mart requires the same kind of
strategic approach that the CIO used to organize the key manufacturing
sectors during the 1930's and 1940's. Then, the nascent industrial
union movement, inspired by radical social and political movements and
legitimized by important legislative reforms, succeeded in unionizing
much of the unskilled workforce. Unions worked in a coordinated
manner, using a variety of elements: mass, direct action; targeting
key areas in each industry; salting and working from the outside;
community mobilization.

Today, unions in both the USA and Canada need to put aside their
narrow institutional interests and make the unionization of Wal-Mart a
number one collective priority. Needless to say, in order to pressure
Bentonville, such a campaign would requite a fundamental change in the
deferential approach that most unions take towards both employers and
neoliberal governments. They also would have to work with a number of
mass movements that are affected by Wal-Mart, such as the women's
movement, environmentalists, former Wal-Mart workers, health care
activists, anti-globalization and anti-sweatshop organizations and
movements for local community democracy. (The consequences of not
developing such an approach can be seen by the pathetic response of
the union movement to the closure of the Jonquiere store. Wal-Mart got
the message, loud and clear.)

There is also the proposed Wal-Mart Worker Association model of
non-majority unions, proposed by veteran American organizer Wade
Rathke. He argues that current conditions don't allow Wal-Mart unions
to become sole bargainers for workers now. Instead, we must build
towards that goal, organizing those workers who wish to affiliate to
the union movement as part of a bigger series of campaigns, including
struggles over workplace rights. 

Unions also need to show low wage workers like those at Wal-Mart that
they are the most appropriate tools for increasing their living
standards and bettering their working conditions. They must challenge
two-tier wage models increasingly imposed in the organized retail
sector and show why they can provide an alternative to the culture of
paternalism that rules places like Wal-Mart. 

Political Mobilization is Key 

Currently, there are a series of local campaigns to force Wal-Mart to
accept certain terms and conditions in order to gain entry to these
communities. Local laws affect store size, zoning and location,
minimum wages and working conditions, provisions for an impact
assessment study, local sourcing and protection of small merchants.
Some have successfully limited Wal-Mart, others have kept Wal-Mart out
and still others were defeated by Wal-Mart inspired counter campaigns.
Hopefully, these campaigns can become part of what clearly needs to be
a bigger, multifaceted challenge to Wal-Mart. 

As a key leader and beneficiary of both neoliberalism and capitalist
globalization it only stands to reason that the giant retailer can
only be tamed or reformed as part of a movement against key elements
of the latest stage of capitalism. Without a political movement that
seeks to limit the mobility of capital, fight free trade and support
struggles in developing countries like China for worker rights and
alternative development models, it is hard to see how we can succeed
in reforming Wal-Mart. In a similar way, the battle against Wal-Mart
needs to proceed alongside efforts to establish living wage levels,
strengthen labour standards and re-regulate labour markets here at
home. 

Herman Rosenfeld is a retired CAW activist living in Toronto.

*********************************************************************

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The Canadian Labour Congress:

Canada Needs a $10/hour Minimum Wage

"Canadians expect that everyone who works should be paid fairly,"
says Ken Georgetti, president of the Canadian Labour Congress. "Too
many Canadians are working in full time jobs, yet they still have to
choose between paying the rent and feeding their families. It's time
to bring back the federal minimum wage to help the growing number of
working families earning poverty wages."

A worker today needs to earn $10.09 per hour for 2,000 hours to reach
the poverty line. -- Disturbingly, the proportion of adult workers
(age 25 plus) who are working for less than these wages has increased
in 2006. They are workers who, working full-time hours for the whole
year, still would not reach the Statistics Canada low-income line.

"The federal government recently commissioned and paid for its own
review of Canada's labour standards. The report came in last October
and it calls for the restoration of a federal minimum wage that would
be set at the poverty line as a way to address the growth of
precarious, low-wage jobs across the country," explains Georgetti.
(That report is available at http://www.fls-ntf.gc.ca/en/fin-rpt.asp
).

In December, the Canadian Labour Congress' Report Card 2006 Is Your
Work Working for You?, which compares job and income statistics for
the first half of each year since 2001, noted a disturbing growth in
the number of Canadians unable to earn enough to meet their basic
needs in the first part of 2006 despite strong job creation numbers
over the same period. 

"Getting a job is supposed to mean getting ahead. It's supposed to be
a family's ticket out of poverty. A country so prosperous and rich in
opportunity should be able to do better for working citizens,"
concludes Georgetti.

The Canadian Labour Congress' Report Card 2006 Is Your Work Working
for You?, is available at http://www.working4you.ca
.

The Canadian Labour Congress, the national voice of the labour
movement, represents 3.2 million Canadian workers. The CLC brings
together Canada's national and international unions along with the
provincial and territorial federations of labour and 135 district
labour councils. Web site: www.canadianlabour.ca

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