Making the future work

Work is about more than merely earning a wage. Alan Myler outlines why it is time to rescue this key activity from the profiteers and the growing body of thought about how this might be done.

LONG term solutions to the current economic crisis involve building a different type of society, one which places democratic control of economic activity at its centre. Key to this is the democratisation of the workplace.

Work fills many needs – it provides people with income, social interaction, purpose, and a sense of dignity. The absence of meaningful well-paid work manifests itself in damage to individuals and communities through poverty, deterioration of mental and physical health and social alienation.

But Irish society not only faces the problem of a lack of work but also, due to its capitalist organisation, the alienation of employed workers from the fruits of their labour. What this means is that many workers are pushed by their employers to such an extent that work becomes a grinding process which destroys their enthusiasm and energy.

So the issue is how can work be different, be better, be more rewarding, less exhausting? Also what are the solutions to unemployment, under-employment, and the exploitation of workers? In the immediate term the answer is to expand the numbers of jobs in the economy, while also moving in the direction of the democratisation of workplaces. Without the latter there will be no progress towards the longer-term goal of democratic control of the economy.

More of the same is not enough, there must be more and better combined, otherwise the Left is not proposing a solution that is any different than a return to the illusory full employment of boom-time capitalism.

What should the Left propose in terms of an immediate start on the road towards sustainable meaningful and rewarding work? At a conference organised by SIPTU in November 2011, entitled “Innovation in Manufacturing – A Driver for Jobs and Growth”, SIPTU President Jack O’Connor spoke on the need for a return to local manufacturing of goods as a prerequisite for Irish economic recovery.

Globalisation has seen acceleration in the move away from locally-based manufacturing towards the import of products from locations spread across the world.

While as consumers we gain from the lower costs of these globally produced goods, as workers we pay the price as the jobs that were available to our parent’s generation in local factories are no longer available to us or our children.

Companies which used to produce agrifood products, consumer items and textiles in Irish factories have rapidly relocated to economies with lower wage costs. This leaves increasing numbers of Irish workers seeking transient retail jobs, selling cheaply-produced items to an increasingly unemployed and under-employed populace who are losing the ability to buy these goods at any price. It is a vicious circle that needs to be broken.

One of O’Connor’s central themes was to analyse the successful German Middelstand model of sustainable economic development. This model rests upon investment in the creation, promotion and retention of an industrial base of small and medium-sized producers, which engage with workers in a meaningful manner through the mechanism of Works Councils.

These Works Councils’ members are elected by a company’s workforce and work alongside management on issues related to the business’ production processes and development.

O’Connor argued that these Works Councils had provided a measure of workers’ involvement which had been pivotal in providing good employment conditions while at the same time providing private capital with the reassurance of industrial harmony. This win-win situation he stated had freed investors from the uncertainties of confrontation and formed the backbone of a social democratic compact between labour and capital which was central to the post World War II golden era of economic growth.

O’Connor could be accused of overemphasising the success of such a model due to its, on the surface, resemblance to the social partnership approach which had formed the core strategy of the Irish trade union movement for over two decades.

However, to accuse O’Connor of simply looking for excuses for a partnership approach would be to miss a central theme of his argument, the importance of Works Councils, and their essential role in the journey towards economic democracy.

THE subject of economic democracy was also a key theme in a presentation by New York based Marxian economics professor, Richard D. Wolff, at a conference in Berlin in November 2011 hosted by the Rosa Luxemburg Foundation – a policy think-tank linked to the Die Linke political party. Wolff discussed the potential for workers’ self-directed enterprises to provide a vehicle for new investment in an expansion of economic activity. In his presentation Wolff called on the Left to refocus its attention on “the internal organisation of enterprises” as the key political battleground where long term progressive success can be secured.

To this end Wolff outlines the need for a massive state “employment programme with a radical difference. The bulk of the money will be used to provide capital to unemployed workers, who will be provided also with the assistance to begin and establish their own self-directed enterprises.”

These enterprises would be directed in terms of what they produce, how they produce it and what happens to the profits, by the workers themselves – “they would become their own board of directors.”

According to Wolff; “The idea of workers self-directed enterprises is that the workers displace and replace the capitalists with themselves.”

Closer to home, calls have been made by the veteran political theorist Roy Johnston, for a re-opening of discussions amongst Irish radicals on the merits of cooperatives as a vehicle for the re-organisation of the economy.

It is fair to say that whether couched in the language of Works Councils, workers’ self-directed enterprises or co-operatives, the concept of increasing the involvement of workers within the running of their workplaces has merits which are apparent to all on the Left.

So how could workers’ participation in the running of businesses work in Ireland? To answer this it’s useful to look at two models which succeeded in providing the sort of meaningful, well-paid and sustainable jobs which are currently missing in the Irish economy.

A Swedish model of workers’ participation in the ownership and management of their employers’ businesses is described in American Marxist Erik Olin Wright’s excellent book Envisioning Real Utopias.

The book addresses the issue of how can real progress be made while in the short term improving workers’ lives? Olin Wright describes the political background to legislation proposed by the Swedish Social Democratic Workers’ Party, and endorsed by the Swedish Labour Federation in 1976, to provide for the expansion of workers’ ownership of businesses.

The type of workers’ ownership outlined in this legalisation is very different from the shareholder model endorsed by multi-national corporations, whereby employees are locked in to corporate objectives via the “golden handcuffs” of employee share-ownership schemes.

These schemes provide workers with the illusion that their own interests are best served by, and correspond with, the interests of their employers. In reality the employee has no input into the running of the business but is just another individual shareholder with no real input into their workplace’s operation.

The Swedish model treated the workers as a body rather than as individuals. The workers nominated representatives who sat on the board of directors, representing the interests of the workers in terms of the tactical and strategic business decisions taken by the management of the firm. Combined with this workers’ directorship, the legislation provided for employee ownership of the business through a workers’ investment fund into which individual employees paid a subscription through their trade union.

The genius of the legislation was that it was envisaged that with time the relative balance of power on the board of directors would move in favour of the workers, because the increasing value of the workers’ investment fund would dilute the ownership of the other investors including the owner and commercial lenders. So with time the interests of the business and those of the workers’ would become fully aligned, to the benefit of both.

This mechanism allowed for the possibility of creeping socialisation of existing private companies. The legalisation was eventually undermined by the business lobby. The lesson to be taken from this experience is not the model’s failure to withstand vested interests, but the successful threat raised to those interests via the expansion of industrial democracy.

A second model for workers’ participation in the ownership and management of enterprises comes from China. In an article in the Summer 2011 edition of China Left Review entitled “Expropriation or Workers and Capitalist Transformation”, sociologist Joel Andreas who teaches at John Hopkins University, outlines the structure of Chinese state-owned worker managed enterprises in terms of engagement between individual workers and their collective work groups and the business enterprise.

Andreas presents a model of enterprises where there is an absolute overlap of interests between the work group and the business. Where the enterprise provides for all aspects of the material needs of the workers in terms of secure employment, housing, healthcare, education, nurturing of children (as the next generation of workers), provision of generous care for the elderly in payment for past efforts, sports and cultural activities.

The provision of such support to the work group, and hence to the individual worker, was accomplished through the direction of the business via worker appointed management, who ensured that the needs of the business fulfilled the needs of the workers. It was a far remove from the western capitalist model of a day’s pay for a day’s work and no more and no less.

However, under the economic ‘reforms’ that have swept through China, these social provisions associated with the work group structure have been systematically dismantled through the removal of workers’ influence and control of enterprises.

This social basis for work has been replaced with a capitalist objective of private profit. Housing, education and healthcare have become commodified and must be purchased in the market from workers’ wages. This is the lesson the Chinese experience holds for Irish workers. The social benefits they have lost in the embrace of the capitalist model are part of what we must aim to gain as part of our longer term project of democratisation in the workplace and the pursuit of social good, not private profit.

WE can all envisage ways in which our daily work-lives could be made better through structural changes in the power relations between employer and employee. Structural changes that replace the imperative to generate profits for the business owner at all costs with an equal concern for the social aspects of work. A balance must be fought for which adequately takes into account the needs of the business and the needs of the workers. A better balance has existed and continues to exist in different economies and at different times.

The viability of alternative models of industrial organisation is not guaranteed. In both the Swedish and Chinese examples, elite vested interests were able to dismantle the gains achieved for workers.

That each of these examples illustrates the rise and fall of models of workers’ control of the means of production simply illustrates that the wheels of class conflict are constantly in motion. Neither case proves that gains or losses are inevitable, rather they demonstrate that constant endeavour is required to progress towards the transformation of the economy in the interests of workers.

It is clear that legislation to promote and prioritise localised manufacturing would create jobs through the replacement of imports and the value-added processing of locally-produced raw materials.

The scale of capital investment in such businesses will vary and some are for now more suited to development through the commercial semi-state sector, while others will be more suitable to mixed ownership models including workers’ self-directed enterprises or co-operatives.

The immediate priority in Ireland must be the creation of employment, and in that respect it is important to end the capital strike of private investors by providing long-term sustainable business opportunities.

But at the same time this period of crisis must be used to enshrine the principle of economic democracy within newly created enterprises.

The State must also prioritise investment in indigenous hi-tech export-based enterprises via investment mechanisms which tie in workers’ control of the business.

This will ensure a focus on developing long-term sustainable business success and employment. It would be in stark contrast to the fast buck investment, which currently sees the State act as the venture capitalist of last resort for fledgling businesses which are too risky to attract private investment.

The State could do these things. The existing elites will oppose any movement in this direction. It is the task of the forces of the Left to propose realistic immediate alternatives to neoliberal austerity and the increasing concentration of wealth within the hands of a tiny globalised elite. This presentation of an immediate alternative must be done while maintaining a longterm vision of a new social organisation which will provide economic, societal and environmental sustainability. The provision of more and better work is the first step along this path.

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