Unions are to capitalism what opposition parties are to politics.
Posted on 16:05, July 27th, 2010 by Pablo
In the debates about the proposed labour law reforms there appears to be fundamental misunderstanding or ignorance by National and ACT of the purpose of unions in capitalism. The latter are seen by NACT as at best a source of inefficiency and profit loss; at worst parasitic wealth destroyers. They appear to misunderstand that capitalism left to its own devices, with no collective counter-weight provided to workers, is akin to a political regime without opposition parties. That is, it is inherently an authoritarian status quo in which owners rule and workers obey. Thus, if we hold it self-evident that democracy is a better form of regime than dictatorship precisely because it allows for the existence of a freely organised competitive political opposition that can contest power and times compete for it, then we must also recognise that capitalism needs unions in order to be representative and fair to the society at large. The trade off between democracy and capitalism is exactly that: a diminished rate of exploitation in direct proportion to the measure of voice exercised by workers in pursuit of a fair share for all.
That is why unions were organised in the first place: to bring a subordinate group vehicle of voice and redress to the economic system. Whatever their very evident flaws (Leninist organisation, iron law of oligarchy bureaucratic rationales), unions provide a democratic counter-weight to unfettered capitalist exploitation. Just as it is preferable not to have a closed, unaccountable (or at least vertically unaccountable) oligarchical elite run the affairs of state, so too is it undesirable, from a democratic perspective, to have a closed, vertically unaccountable economic elite determine the social relations of production. If one believes in democratic capitalism, one must believe in a central partnership role for unions within it.
This is true whether labour-based or capitalist-oriented parties are in power, since in capitalist societies the material welfare of all is dependent on the investment decisions of capitalists. But capitalists need workers to realise their investment, and workers need to be productive for profits to occur. There is consequently a structural bias in favour of providing the working conditions and larger social context in which profitable production can occur over the long term. For that to happen workers need to accept the system as given, which is a function of them perceiving a partnership stake in it. That means a modicum of voice and representation. Democratic capitalists consequently understand the need to exchange super-exploitation and authoritarian control of the workplace for increased working class representation in both politics and production. In turn workers (and their political representatives) accept the capitalist foundations of society and the dominant role of capitalists within it (in other words, they forego a move towards socialism). This exchange is at the heart of democratic capitalism. Although negotiating the margins of the democratic capitalist social contract can occur depending on the nature of the government in power, “touching the essential” aspects of it is not.
Authoritarian capitalism offers many short term advantages to business, but it does not guarantee long term gains. Unmitigated authoritarian exploitation, be it in the workplace, politics or both, breeds resentment. Born of a lack of consent to the dominant system, resentment can be manifest in everything from petty acts of social defiance to industrial sabotage to revolution. Short term acquiescence may be bought with material rewards, but the long-term picture remains clouded so long as workers do not buy in to the system as given and instead resent their subordinate status in it. Absent mass consent and given the inevitability of working class resentment, the resort to the “weapons of the weak” negatively impinges on profit, if for no other reason then that the costs of repression grow larger the longer authoritarian control is maintained. After all, you cannot repress the same amount of people in the same measure over time. Since capitalists abhor uncertainty and seek stable rates of secure return, a peaceful, consent based socio-economic and political order is preferable to an imposed one. That gives economic utility to democratic capitalism.
In fact, where democratic capitalist systems work best (hegemonically, as it were), many if not most workers strive to become capitalists themselves (small businesspersons, at a minimum). They see themselves on a continuum of upward mobility based on workplace fair play and merit. Socialism is not their preferred option. The proof is in the mythos: is this not the Kiwi, Ozzie and American dream?
Here is where NACTs reforms and the demands of the employer class says much about their true orientation. They claim belief in freedom of choice and the benefits of market competition as the great levelers of social ambition. If that were true, then they would welcome workers to freely organise without legal constraint or negative repercussion because true market competition and workers freedom of choice would improve overall economic (labour) market efficiency. After all, according to their own logic, the market works best when all have equality of opportunity, and it clears best when all actors enter into the market exchange exercising their full potential as free agents involved in the mutual supply and demand of goods and services. So if workers exercising their free choice want unions, then more the better from a market perspective. Why put constraints on that freedom?
Yet in practice NACT seeks to place constraints on working class collective choice and voice so as to better exercise owner/manager prerogatives in the workplace. They are, in other words, hypocrites who do not really believe in the power of the free market or closet authoritarians out of ignorance (unlikely) or by design. Or both. No amount of political spinning can disguise that fact.
What is more, NACT does not appear to comprehend, from a cynical perspective, that allowing for unionisation, including union workplace access, while reducing limitations on the right to strike and collectively bargain across economic sectors can actually serve very usefully as an alienation device in which workers are led to believe that they are real partners in production in a system in which the fruits (surplus value) of their labour are appropriated by others (in a variant of Lenin’s “democracy as capitalism’s best possible political shell” argument). Although unfettered collective action has the potential to open the door to worker challenges to control of production, the reality is that in democratic capitalism private ownership is reified from birth to grave and most workers live with the dream of being bourgeois in culture and consumption if not employment. So whether cynically or sincerely committed to workplace democracy, enlightened capitalists understand the long-term political utility of union representation in democratic society. NACT and its business supporters appear to be anything but enlightened.
As I mentioned in my previous post on the matter (“The Blues Go Black”), the proposed reforms owe their inspiration to the Pinochet Labour Code. The question is whether NACT have the same view of unions as Pinochet and “Pepe” Pinera did, and if so, why do they make any pretense as to being democratic? Could it be that what we are seeing in NZ is the first attempts to turn the economic bases of the democratic social contract into something akin to unchecked elite imposition under manipulated electoral conditions?