There’s no question as to why the modern labor movement would need to pay attention to China. Every major U.S. and foreign transnational corporation has growing operations there, meaning Chinese workers are one of the main hammers that global capital uses to drive down wages and conditions for workers in advanced capitalist countries like the United States.

That’s why a leadership delegation from Change to Win went to China to see if we could expand the front in our mission to Restore the American Dream, to follow the jobs and to find out for ourselves whether we there is a realistic prospect of uniting with Chinese workers that face the same challenges, working for the same global corporations that employ workers in the U.S.

I’m going to be discussing what we learned and observed in other posts, but let me start with why we went, because all the buzz in both the Chinese and American press was not that Change to Win went overseas. Rather, our visit was historic for two interrelated reasons: First, it marked the first time that a U.S. labor federation met with the Chinese labor federation on equal footing. Second, it generated new thinking on how to tackle the challenges of globalization and the downward pressure on wages and living conditions in the United States.

Simply put, we began a dialogue with the “communist dominated” All-China Federation of Trade Unions (ACFTU) – which has been shunned by the American labor movement for more than fifty years – because, as the Wall Street Journal reported, Change to Win is “taking a new approach to the challenges of globalization, plan to work more closely with their Chinese counterparts in hopes of raising wages and working standards in the country and thereby easing the competitive pressure on American workers.”

It’s a huge shift from the days of the Cold War, when the American labor movement adopted a no-contact policy with the ACFTU. The argument was that the Chinese federation acted as a transmission belt for the government – not an independent union that U.S. labor should legitimize.

But in the middle of last century, there were no U.S. or other multinational corporations in China. The country was closed to the world economy, and all Chinese workers worked for state enterprises or on the land. Fast forward to the 21st century – our world has changed, China has changed in even more dramatic ways, and it is impacting every U.S. worker hoping to achieve the American Dream, and every worker who worries about losing it in this new global economy.

And what American worker wouldn’t fear for their economic security? In a comparison of factory wages in China and the United States, the Journal reported General Motors Corp. pays assembly workers at its Shanghai factory $9 an hour, including benefits, compared with more than $60 in the U.S.

Another study on Shanghai, which has the highest standard of living in China: A manufacturing worker earns $5,885 per year in total compensation, which includes all pay and benefits, compared with $55,568 in the U.S., according to Towers Perrin.

So when you factor in bonuses, incentive pay, and fringe benefits, the total average hourly labor cost in manufacturing in China is about $1, compared to almost $30 in the U.S., says a March 2005 Bureau of Labor Statistics report.

And its not just manufacturers that are flocking there for cheap wages, killing good jobs at home. Wal-Mart and other multinationals use China to source their retail goods, filling the shelves of America’s stores at low prices based on low wages. No sector is untouched: In the service industry, U.S. hotel chains like Hyatt, Hilton, Marriott and Starwood that are charging $500 a night in Shanghai and Beijing are not paying the $20 an hour they pay in New York City to their workers. (The Chinese hotel workers are lucky if they earn $250 a month.)

So in our view, if we are to have leverage with multinational corporations that employ both Chinese and U.S. workers, and if we are to stop the race to the bottom, we must engage with the 177 million-member ACFTU. And if it is to remain relevant in the face of economic transformation, the ACFTU must champion the interests of Chinese workers in the emerging foreign dominated capitalist sector.

While much larger, and with the government’s backing, the ACFTU is, in many ways, like us, fighting for its life in the face of global capital. And more important than the ACFTU or U.S. labor’s institutional survival is the fact that workers in China and the U.S. are under the economic gun. The gap between rich and poor is growing in both countries – even as both experience economic expansion – and the social fabric in both countries is rife with conflict.

We will never turn a blind eye to other developments in the workers’ movement in China. We were eager to meet with non-ACFTU unions in Hong Kong, and to share some of their concerns directly with the ACFTU. But the situation in China today is so fluid that to preclude flexibility in our relationships with NGOs in main land China would contradict our general position as a union federation seeking all the allies we can in the defense of worker rights.

Change to Win unions believe that we must embrace the openings resulting from the dramatic changes in China as part of a bigger global strategic approach that is necessary to unite workers at home in the industries that form the basis of the new American economy.

Corporate America has been in China for at least 15-20 years, and we've been behind the curve. In this rapidly changing economy, all options are on the table: If cooperation with the ACFTU, or any other entity, is what is needed to hold global capital accountable to all workers – our unions will be there.

What do you think?

Greg Tarpinian is the Executive Director of Change to Win.