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From International Socialism (1st series), No.96, March 1977, pp.7-8.
Transcribed & marked up by Einde O’Callaghan for ETOL.
‘If there is to be any hope of convincing the workers of the. virtues of private enterprise, the way to do it is to include them in decision-making at the top.’ Jack Jones (quoted from the minutes of the Bullock committee, The Economist, February 12 1977).
LARGE sections of big business, led by the CBI, are bitterly opposed to the proposals of the Bullock committee on industrial democracy, which they see as an encroachment upon their right to make production decisions at the board level.
Yet the proposals only threaten workers’ organisations. If large sections of workers can be convinced that their interests are better looked after by union representatives on the board of directors than by shopfloor organisation, and that these interests are the same as those of management, then the power of the shop stewards’ committees will gradually be undermined.
The proposals have the support of the Labour government and of important sections of the trade union bureaucracy. Indeed, early legislation for worker directors is part of the Social Contract. Jack Jones of the TGWU and Clive Jenkins of ASTMS sat on the Bullock committee and played a dominant part in drawing up the majority report, which requires that worker directors equal in number to those chosen by shareholders should sit on company boards.
The AUEW opposes the ‘blurring of class distinctions’ that worker directors would involve in privately owned firms, but doesn’t seem to mind when it comes to the nationalised industries, where it supports participation. The GMWU wants to see, instead of worker directors, further legislation for collective bargaining – let the ‘neutral’ state set the rules and we’ll make sure our members play along with them (Financial Times, January 12 1977).
In any case, participation is nothing new. Schemes are being implemented in the GPO and other parts of the public sector, as well as at Harland and Wolff in Belfast (Financial Times, 26 January 1977). And there is a battle going on at the minute between government and employers over parity trade union representation on the boards of pension funds. For the Social Contractors, the Bullock proposals will simply tidy up participation in a thousand or so large private firms whose directors are too unenlightened to give their workforce an interest in the efficient running of the firm.
Much more, interesting is the reaction of the CBI and spokesmen for British industrial capital. They are opposed to the statutory imposition of worker directors, although they are prepared to discuss the Bullock minority report, which lets worker representatives onto a supervisory board, although not onto the board of directors that actually runs the firm. And one of the authors of the minority report, Barrie Heath of GKN, is reluctant to put even this plan into operation in his firm (Financial Times, January 27 1977). The minority report also avoids the proposal that worker directors be elected through trade union channels, insisted upon by Jones but bitterly opposed by the CBI.
Why all the fuss and the threats from the CBI to stop backing the government’s economic strategy if the Bullock proposals are implemented? Our briefing How special is the British crisis in International Socialism 95 showed that the strength of shopfloor organisations is the biggest threat to the revival of British capitalism and that a major attack on these organisations is on the agenda for 1977.
The Bullock proposals fit in perfectly with such an offensive against shopfloor organisation. They provide an ideologically necessary democratic veneer to the reorganisation of British
capital under the aegis of the state. In the eyes of the proponents of such a reorganisation, the directors of big firms in the future would represent the big institutional investors (pension funds, insurance companies, etc), the banks, other firms, and the trade union bureaucracy. They would be less concerned with the viability of the individual firm than in the competitiveness of the national capital of which the firm would be merely a single component. Worker participation would be part of a company structure aimed at increasing productivity and putting the gains to proper use. To quote Clive Jenkins:
‘The argument of the Bullock report is that the present administration and power relationships in British companies is a yellowing sepiated snapshot of relationships as they used to be when entrepreneurs, who had mastered every skill and procedure, took decisions bounded only by their capacity to finance them.’ (Financial Times, February 8 1977)
This prospect is less attractive to those who run big business in Britain today. They are quite happy to receive government support to prop them up when they are in trouble and government subsidies to encourage them to invest. But they have no intention of surrendering their control of industry, even in exchange for improved industrial relations.
INDUSTRIAL DEMOCRACY is a response to capitalist crisis. It is a product of the need for the state, on behalf of the ruling class, to control production directly in order to ensure the competitiveness of the national capital on the world economy. The example of West Germany, home of high productivity and participation, bears this out.
During the Weimar republic (1919-33), beset with recurrent economic crises, the working class was persuaded by the reformist leaders of the Social-Democratic Party (SPD) and the trade unions that socialism could be and was being built through unions participation at all levels of decision-making in industry and the State. Thus workers had some form of partipation in the coal industry, the railways and even the Reichsbank.
In 1945 the trade union leaders returned to a country devastated by war and under military occupation by the victorious Allies. Workers’ organisations had, of course, been completely smashed by Hitler.
The employers were on the defensive in the face of Allied plans to break up the great iron and steel cartel and dismantle parts of German industry and send them abroad as war reparations. They were forced to concede parity Mitbestimmung (codetermination, i.e., participation) for the trade unions on the supervisory boards of the iron and steel industry.
The employers’ confidence was restored by the establishment of the Federal Republic in West Germany in 1949 and the Korean War boom that marked the beginning of the West German ‘miracle’. The Allies withdrew from direct interference in production. Only the threat of a one-day strike forced the ex-Nazi steel bosses to accept the parity principle. The ruling class retaliated by invoking the bogey of the trade union controlled state. The subsequent industrial constitution law limited the number of worker directors on the supervisory boards of other industries to one third. Mass demonstrations and a printers’ strike could not win parity for trade union representatives. Nor was the question of workers’ control over production raised – the debate took place on the terms laid down by the bosses: not who controls – workers or capitalists? but how much participation for the workers?
The result of Mitbestimmung has been the complete integration of worker directors into the efficient running of German firms. They sit on the supervisory boards along with representatives of big shareholders and the directors of other companies, all equally concerned with the profitability of the firm. Mitbestimmung did not prevent mass lay-offs in the Ruhr mines in the late 1960s; or in Volkswagen (a state-owned firm) in the mid-1970’s.
PARTICIPATION means the further integration of the trade union bureaucracy into the state and management. It means subordinating shop floor organisation, the only real defence of jobs and living standards, to the priorities of profit and competition. What we want is not workers’ participation in their own exploitation, but workers control over production, so that they can impose their own priorities, the priorities of production for need, on the economy. And workers’ control can only be guaranteed by the seizure of state power by the working class.
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