In response to:
The Swedish Promise from the December 4, 1980 issue
To the Editors:
Robert L. Heilbroner’s “The Swedish Promise” [NYR, December 4], in which he describes Sweden as having a capitalist economic structure (private ownership and control of the means of production), with grafted-on socialist elements (a welfare state and worker shop-floor decision-making power), is surely one of the best short descriptions of the Swedish economy. Still, one of Heilbroner’s conclusions—that increased worker participation in ownership and control through the Meidner plan is likely to be inefficient and costly—is misleading and questionable.
As Heilbroner notes, the proposed Meidner plan involves the creation of an employee-owned investment fund, and is basically a proposal to increase savings and stimulate investment and growth in Sweden. At the same time, the plan is problematical for capitalists, since certain versions of such an investment fund might ultimately challenge property rights and lead to worker ownership and control of the means of production.
Sweden is not likely, of course, to adopt a variant of the Meidner plan which seriously challenges the property rights of capitalists. And a parliament-approved plan is not likely, suggests Heilbroner, to allow worker participation to the point of really “re-humanizing” the workplace. For such rehumanization, he asserts, would make things “cost more” and would “endanger Sweden’s ability to compete on world markets.”
But perhaps the Swedish parliament favors capitalist-organized production over industrial democracy and humanization of the workplace regardless of costs. Where is Heilbroner’s evidence that a movement toward democratic worker-management is “inefficient” or “costly” (except, perhaps, to profits of former capitalists)?
Although all the evidence is not yet in, and further productivity measurements are needed, experiments with worker-management and lesser degrees of worker participation in the US and elsewhere tend to result in higher productivity and lower real costs. Indeed, Paul Blumberg, in Industrial Democracy, notes that “there is scarcely a study in the entire literature which fails to demonstrate that satisfaction in work is enhanced or…productivity increases accrue from a genuine increase in workers’ decision-making power.”
It should not be surprising that workers who own or manage an enterprise in their own interests tend to be more productive than those who work in the interests of others. Heilbroner’s conclusion which denies this, and rather, tends to assert capitalist efficiency as the ideal, detracts from his otherwise incisive description of Sweden’s economy.
Department of Economics
Ithaca, New York
Robert L Heilbroner replies:
Professor Brous may well be right in anticipating an increase in productivity as the consequence of enhanced employee participation. The question is whether this would be a short-lived honeymoon effect or a long-run permanent one.
Lacking evidence, one can only resort to appeals to plausibility. Does Professor Brous really imagine that workers who had gained control over the pace, duration, and fragmentation of their work would turn out steel, computer chips, textiles, or bread at a lower cost per unit than capitalist factories? I simply find it difficult to picture how the production process would be organized to bring about this result. But I would be happy to be proved wrong. Then John Stuart Mill will have the last word, and socialism will be ushered in, not by political means, but simply because associations of workingmen will undersell their capitalist competitors. (See Mill’s Principles, Book IV, Ch. vii, No. 6.)