ABSTRACT
Whatever other consequences European integration may have had, it has vastly increased the competitiveness of the European economy. Competition is a pervasive social force. Not only do its effects extend far beyond the firms and sectors directly exposed to it, but they are beginning to transform the institutional base and indeed the very concept of social solidarity. There is no reason why Europe, in spite of its high labor costs, should not continue to have highly profitable firms and industries even in a global economy. But there is also no doubt that the internationally exposed manufacturing sector of the European economy will in future absorb only a declining share of the European workforce. In fact, where restructuring in response to the new competitive conditions is successful, it entails the ruthless elimination of slack, above all of surplus labor. What was jokingly said of the German railway system before privatization – that it was “a social fund with a railway attached to it” (eine Sozialkasse mit angeschlossener Eisenbahn) – to some extent also applied to the large oligopolists of Fordist mass production: given the manifold protections from competition they were able to devise for themselves, they could afford to sustain unused resources and allow unions and works councils to divert them to redistributive solidarity (Kochan et al. 1986). The labor shedding of the 1990s, even in an immensely successful manufacturing country like Germany, shows that this period has come to an end.
