In my letter “Quick Questions” a couple of weeks ago, I outlined a framework for reform proposals, consisting of these questions: 1) Does the reform point to the need for class-based political action via pressure, paradigm shifts and related grassroots discourse for legislative implementation and more? 2) Does the reform contribute to "socialist production" or, to be very much specific, the systemic establishment of worker management (ie, planning, organization, direction, and control) and responsibility over an all-encompassing, participatory economy - free from surplus labour appropriations by any elite minority, from dispossession of the commons and more in the form of private ownership relations over productive and other non-possessive property, from all forms of debt slavery, and from all divisions of labour beyond technical ones (overspecialization) – as a very realistic but basic means to end the exploitation and alienation of human labour power in productive labour and of humanity as a whole? 3) Does the reform emphasize going beyond nation-state constraints regarding its achievement? Minimally, this means international solidarity and, maximally, transnational struggle and emancipation? If the reform fails on even one of these above questions, then it might not be worth considering, because "socialist production is not kept consciously in view as its object" (to quote Karl Kautsky). As a fourth question, does the reform “make further progress more likely and facilitate other progressive changes as well” (to quote Robin Hahnel)? If the reform fails on only this question, then it is on the threshold before class rule is required, the maximum that could possibly be achieved under bourgeois-fied commodity production. Both comrades Mike Macnair and Arthur Bough go off on tangents, from commentary on “global money” to revisiting Kondratieff. Both mention defending reforms here and there, but that’s not the same as advancing. The CPGB Draft Program itself could use some radical improvement. Before moving ahead, we should take a step back first. Why Demand? In September 2011, hundreds of protesters heeded the months-old call of the Canadian-based Adbusters Foundation for a peaceful occupation of Wall Street as a form of sustained protest against growing inequality in wealth, corporate influence on the political process, and relative legal inaction in the wake of the recent financial and economic crisis. Only a short time passed until police brutality against sustained protests elsewhere in New York City unintentionally popularized this initial protest movement all across the United States, Canada, Belgium, Germany, Italy, New Zealand, and elsewhere worldwide. All over, the broader political movement used the left-populist slogan “We are the 99%” to refer succinctly to all those outside the wealthiest one percent of society. Though unsurprisingly only token support came from the corner of mere labour disputes, the kind of popular support given to this left-populist movement came from all other walks of life. Nonetheless, a question resulting from Occupy is: Why demand? Simply put, while the modern state is by no means the only acceptable arena for worker-class political activity in general, it cannot be dismissed. Politics certainly cannot be reducible to the modern state, nor can the modern state be the exclusive domain of legitimate politics. However, the modern state itself cannot be substituted by any group of “civil society” institutions. Such assumption on social relations is abstracted from state activity. Therefore, it is necessary to press forward or issue demands of an immediate, intermediate, and threshold nature that explicitly include the bourgeois-capitalist state as an elephantine component of the political audience, but that also give no legitimacy whatsoever to the rule of bourgeois law simply by the mere proper acknowledgement of civil disobedience. Neither Advocate Nor Oppose? One last criticism of issuing demands must be addressed: the toxic notion of managing the bourgeois-capitalist state, or of managing bourgeois capital, state capital, and so on. In more technical terms, this means that reform struggles do not really benefit the working class, but instead facilitate capital accumulation and the reproduction of labour power. One clear example of this would be calls for “formulary apportionment” of taxable corporate income at the international level, which would nonetheless solve much or most of the tax loopholes exploited by multinational corporations. What these particular critics simply do not understand is that there are times when these two outcomes intersect; there are measures strictly for facilitating capital accumulation and the reproduction of labour power, measures strictly for labour empowerment (politically and economically), and measures that can achieve both in varying degrees. Before directional or genuinely transitional measures, the reforms that should be pursued are the ones that, in addition to satisfying the four questions at the beginning of this article (except for reforms on the threshold, which satisfy only the first three), and while involving some degree of facilitating capital accumulation and the reproduction of labour power, yields little in the way of this and much more in the way of labour empowerment. Meanwhile, directional economic measures are simply those economically inclined demands that result strictly in labour empowerment and necessarily require the working class to expropriate, beforehand, ruling-class political power in policymaking, legislation, execution-administration, and other areas. What Independence? From anarchist tendencies to cooperativists, there is the tendency to lump goals pertaining to two or more forms of class independence together, and conflate them. The politico-ideological independence of the working class is embodied in its very own party-movement of class-strugglist labour, existing on the premise that real parties are real movements and vice versa, but lumping this together with goals of economic independence echoes the overly broad and extremely vulgar assertion that “the economic is political” – courtesy of ever-crude economic determinism). From the long-lived cooperative movement to the premise of collective bargaining representation to the various residential anti-gentrification campaigns to the social movements for local currency alternatives to government money, the respective histories of all these and more have, individually and combined, demonstrated that economic independence for the working class under bourgeois-fied commodity production is wishful thinking, since related demands pressed forward have not and cannot be established on the level of society as a whole except through the overall body politic, let alone enforced by the modern state. “Self-Help” vs. Iron Laws On the subject of cooperativists and “self-help” in general, it isn’t without blemishes. The long-lived cooperative movement spawned class-conciliationist distractions: consumer cooperatives such as The Co-operative Group in the UK, housing cooperatives, mutual insurance, and all forms of cooperative banking (since employee-owned cooperative banks still extract from society economic rent in the classical sense). It is no accident that the cooperative movement, from which narrow economism first emerged, has avoided and continues to avoid political struggles, substituting the aim of class independence on a politico-ideological basis with the illusion of economic independence! Consider the German liberals in Marx’s time. Inspired by the French cooperative movement, economists like Bastiat, and the British cooperative movement, these liberals urged workers to engage in “self-help” and “thrift,” neglecting the underlying economic factors of those same workers. These days, those factors include: real wages, discretionary savings rates, and personal debt levels. We should all know, of course, the indictment against neo-liberalism on all three counts: declining real wages, low to negative discretionary savings rates, and rising personal debt. Enter an underrated take on the crude and outdated Iron Law of Wages, a take that nonetheless should be revisited today. This take was that of Ferdinand Lassalle, who, as noted by Lars Lih in Lenin Rediscovered, had a political and not economic objective in mind: that class-based political action mattered and not cooperative activity or mere labour disputes (inclusive of trade unionism). I’ve written about how boring and academic “relative immiseration” sounds, and I reflected upon Lassalle’s agitational skills. One should admit, first off, that between Lassalle and Marx, Lassalle was by far the superior agitator. I’ve summed up relative immiseration in modern conditions, and have termed it the “iron law of disproportionate immiseration”: 1) In the “trickle-down” best of times, the lot of workers’ rising incomes, be they high or low, grows worse in proportion as capital accumulates and the incomes of those above them rise further, and while immiserated further by costs on the growing but hidden consumer debt slavery that supports this disproportionate immiseration, they can be subject to the disproportionately immiserating effects of inflation; 2) When rates of industrial profit fall during recessions and otherwise, workers fall into precarity and their incomes are fully subject to the disproportionately immiserating pressure coming from elsewhere in the “freely” and “socially” exploited labour market – namely from the reserved armies of the unemployed – and specifically unprotected workers’ incomes are fully subject to the disproportionately immiserating effects of inflation; 3) When rates of non-industrial profit fall during recessions and otherwise, workers fall into precarity and much of their incomes are diverted to consumer and mortgage debt payments, while still fully subject to the disproportionately immiserating pressure coming from reserved armies of the unemployed and, for unprotected workers’ incomes, the disproportionately immiserating effects of inflation; and 4) During depressions, the absolute impoverishment of workers’ incomes towards subsistence levels is in full effect. Because of all this, again class-based political action is necessary. “State Aid” Comrade Macnair evokes Daniel DeLeon’s opposition to “palliatives” when mentioning state paternalism. Arthur Bough stretches the term “state capitalism” on a similar note. However, the opposition is valid only when the interventionism on behalf of labour (again, yielding so much in the way of labour empowerment and little in the way of facilitating capital accumulation and the reproduction of labour power) is neither extensive enough nor unconditional enough, precisely because economic independence for the working class under bourgeois-fied commodity production is illusory. Historically, when Lassalle repeated Louis “To each according to his heeds” Blanc’s other call for “cooperatives with state aid,” he too only had state-based credit or financing in mind. The Eisenachers who were ultimately his political foil also had the insight to combine politico-ideological independence with calls for some form of state-based economic assistance, but this was crude. Just as crude were some of the economic demands in the Erfurt Program later on. Comrade Macnair’s own analysis of “Keynesianism” could have gone much further, deeper into contexts and development. This would mean going into the neoclassical synthesis of “Bastard Keynesianism” on the one hand, and the underrated Post-Keynesianism on the other. Almost all state welfare today belongs to the former. Having said all that and having the desire to not go off on tangents, these questions are asked: What structural, radical, pro-labour reforms satisfy at least the first three questions at the beginning of this article, if not all four? What demands involve some degree of facilitating capital accumulation and the reproduction of labour power but yield little in the way of this and much more in the way of labour empowerment? What demands would stress that economic independence for the working class under bourgeois-fied commodity production is illusory? What demands need to be included in the CPGB Draft Program? Workweeks In my letter “List system,” I mentioned that comrade Macnair’s take on a 30-hour workweek was unsatisfactory because it did not tackle questions of losing pay or benefits. There should be a comprehensive, multi-clause take for a) the ecological reduction of the normal workweek, b) even for working multiple jobs, and c) including time for workplace democracy, workers’ self-management, broader industrial democracy, etc. through workplace committees and assemblies, All to a participatory-democratic maximum of 32 hours or less without loss of pay or benefits, but with a) further reductions corresponding to increased labour productivity, b) the minimum provision of double-time pay or salary/contract equivalent for all hours worked over the normal workweek and over 8 hours a day, c) the prohibition of compulsory overtime, and d) the provision of one hour off with pay for every two hours of overtime. Here, the extra day off is more important than a shorter workday, and the ecological impact goes beyond even the Green Party’s proposals centered around a 35-hour workweek. At least one clause, “even for working multiple jobs,” requires more state oversight to say the least. Right To The City On the subject of residential gentrification and speculation, the left should be for combating this by first means of a) expanding resident association guarantees beyond the privilege of homeowners and towards the formation of separate tenant associations, b) limiting all residential writs of possession and eviction for the benefit of private parties to cases of tenant neglect, and c) establishing comprehensive tax and other financial preferences for renting over home ownership. That last part certainly implies state action. Upward Wage Adjustments On the subject of upward wage adjustments, the left should be for a) direct guarantees of a real livelihood to all workers, b) including unemployment provisions, voluntary workfare without means testing, and work incapacitation provisions, c) all based on a participatory-democratic normal workweek, all well beyond bare subsistence minimums, and d) all before any indirect considerations like public health insurance. This would include the universalization of annual, non-deflationary adjustments for all non-executive and non-celebrity remunerations, pensions, and insurance benefits to at least match rising costs of living (not notorious government underestimations due to faulty measures like chain weighting, or even underhanded selections of the lower of core inflation and general inflation). Why? This, even with protection against deflation, would be consistent historically with capitalist production’s ability to increase labour productivity and real gross domestic product per capita. Universal Agency Shop Service Those first three reform proposals imply some level interventionism on behalf of labour, but not as extensive as the next one and the ones that follow. Meaningful reduction in the inequality of bargaining power between labour and capital, on the level of reforms, can be achieved only through a) the wholesale absorption of all private-sector collective bargaining representation b) into free and universal legal services by independent government agencies acting in good faith, and c) subjecting their employees to full-time compensation being at or slightly lower than the median equivalent for professional and other skilled workers. To at least some extent Lassalle was correct in his indictment of collective bargaining. This very function, except perhaps where there are no union representatives, goes against politico-ideological independence for the working class. Amongst the various forms of dispute resolution in civil law – negotiation, mediation, arbitration, and litigation – “yellow union” or “business union” careerists perform not just negotiation on the formal behalf of employees, but also (and in practice) mediation between employers and employees. The old Western European corporatist model best exemplifies this, whereby representatives of government, businesses, and unions met together on a regular basis and jointly determined economic policy. Looming over this harsh reality are low unionization rates, with ironically the lowest being in France, and also the difficulty of mobilizing non-professional service workers and the newest, cross-sectoral, cross-age (from youth to midlife and beyond), and growing part of the working class that is by and large the precariat. While the comprehensive reform outlined in the previous section – for living wages, non-deflationary cost-of-living adjustments based on reliable inflation figures, and similar application towards unemployment insurance and voluntary workface benefits – would indeed render collective bargaining for those wage increases for mere cost-of-living adjustments practically obsolete, the overall problems of collective bargaining representation and inequality of bargaining power would still remain, such as in the obvious topics of working conditions and wage increases well above mere cost-of-living adjustments. Laurie Smith commented on this in her recent article against workfare, when she said that “the struggle of the unemployed and precariously employed to just survive would be so tough as to make political and even trade union commitments very difficult. Unions organising the unskilled and semi-skilled will tend to become even more sectional under these circumstances – concerned with protecting their current members’ interests, as against those of the competition from the swelling ranks of the unemployed.” Therefore, the immediate solution lies in the Erfurt Program’s demand for free legal assistance, but extended to the sphere of labour disputes. Significant parts of the administrative apparatus required for the complete provision of labour dispute resolution by independent government agencies and their plethora of lawyers are already in place in the more developed countries, and happen to be called “labour courts” or “labour relations boards.” Beyond crude calls for universal unionization, it should be noted that the collective bargaining function as a whole is different from the strike function, the latter of which should naturally remain the function of whatever (most likely militant) unions remain, including the likes of the IWW or those affiliated to the World Federation of Trade Unions, which would perform more meaningful functions than collective bargaining representation. Cooperatives With Real State Aid Going beyond mere state-based credit or financing, the left should learn from the Eisenachers and be for the genuine end of “free markets” – including in unemployment resulting from workplace closures, mass sackings, and mass layoffs – by first means of a) non-selective encouragement of, b) usage of eminent domain for, and c) unconditional economic assistance (both technical and financial) for, Pre-cooperative worker buyouts of existing enterprises and enterprise operations. This should be pursued even as an alternative to, say, Die Linke’s more timid non-insolvency restrictions of legally binding workplace closure vetoes, or of coupling prohibitions on mass sackings or mass layoffs with socially secure transfers to more sustainable workplaces. I would like to focus on eminent domain, since non-selective encouragement is straightforward, and since assistance on drafting startup plans, operations management issues, etc. or via monetary and physical assets provided for worker cooperative startups definitely goes beyond mere state-based credit or financing. Eminent domain entails due monetary compensation for a purchase by the state but without any prior consent from the current owner. Currently it is employed to further things like residential gentrification, but it can be used to achieve some actually immediate demands and more progressive measures. Funds-wise, it can be funded by certain taxes on employers, like a tax-to-nationalize scheme. Even in a more limited application – such as countering a workplace closure, mass sacking, or mass layoff – this revival of one of the truly and radically social-democratic measures enacted by the Paris Commune suggests the need for more creative and pro-active approaches towards countering unemployment. More important, however, is the fate of “free markets” in general – their genuine elimination, and not mere regulation, arising from means other than dirigisme, or selective mercantilism. The demand for the encouragement of, and unconditional economic assistance (both technical and financial) for, pre-cooperative worker buyouts of existing enterprises and enterprise operations – particularly in light of the recent “occupied factory” movements – improves upon this history with regards to class independence. The very premise of pre-cooperative worker buyouts is that the workers themselves initiate these cooperatives like they did in the Paris Commune, especially if they are about to lose their jobs in the ensuing mass sacking, mass layoff, or some other similar scenario. In the case of closures of workplace establishments not threatened by insolvency, bold workers may initiate these cooperatives if they feel that even legally binding closure vetoes, called for by Die Linke, are insufficient. In any event, the scenario of cooperatives with real state aid is far superior to the “privatize the gains, socialize the losses” effects of perpetual corporate welfare, further examples of which have arisen recently in the financial services industry. Public Employer of Last Resort In my past letters I mentioned Post-Keynesianism as the definitive “economic school” basis of formulating economic reforms. Its core labour policy, as first formulated by Hyman Minsky and one that should be adopted by the left, is the realization of zero unemployment structurally and cyclically by means of expanding public services to fully include employment of last resort (ELR) for consumer services. Note that the term “full employment” is not used. Bastard Keynesianism bastardized this term, and of course there’s the question of frictional unemployment, willfully leaving one job to seek another (or getting fired for unsatisfactory performance). Towards the end of 2001, the Argentine economy went into a nosedive after two decades of privatization and liberalization. Official unemployment jumped to 21.5% by the middle of 2002, and over half the population was living in poverty. However, local currency alternatives to government money flourished and, not unlike the workers of the Paris Commune, Argentine workers reclaimed many abandoned factories to form the cooperative movement in that country. Moreover, in April 2002 the government created the Heads of Household program, providing part-time work for all household heads who met various family requirements. This part-time work consisted of participation in nonprofit-administered training programs and, more notably, provision of community services. However, there were manifold differences between this and typical workfare schemes commented on by Laurie Smith and others recently, and these differences will be elaborated upon at a general level below. The ELR program would take workers with whatever skills they have, then provide on-the-spot jobs that fit those skills. Effectively, the program’s basic wage becomes society’s effective minimum wage, and Minsky envisioned this minimum wage to be at living wage levels. There is also debate among advocates about having a single program wage or differing wages for the different jobs on offer. Likewise, the program’s normal workweek effectively becomes society’s normal workweek. This particular kind of job creation program is a major leap in approaching structural (and also cyclical) unemployment, including that which arises from offshore outsourcing and that which gives rise to the newest, cross-sectoral, cross-age (from youth to midlife and beyond), and growing part of the working class that is by and large the precariat. Traditionally, public works programs have been initiated to get people back to work, but in the recent crisis have been on the whole ineffective because of their treatment as being little more than short-term stimulus spending by governments. Moreover, public works themselves do not take into account the service-oriented skill sets of most resident and guest workers in developed economies, which are not in manufacturing or construction trades, but rather in skilled and unskilled services. Consequently, grassroots agitation for public works tends to not win solid support from these workers, to say the least. With the program, it is thus the case that the modern state guarantees individuals a job, but not necessarily one at the same workplace indefinitely. The biggest stick of bourgeois-fied commodity production is non-frictional unemployment; without this threat of employees entering unemployment, employers can only resort to carrots. Other reactions by employers would, of course, have to be pre-empted or dealt with swiftly, both overtly and covertly, and a number of overt and subtle measures should be implemented beforehand to prevent capital flight, investment strikes (not investing as required by government plans towards maintaining or expanding production), and other economic blackmail on the part of the bourgeoisie and petit-bourgeoisie. Fully Socialized Labour Markets Bourgeois-fied commodity production has three broad markets: the consumer goods and services market, the labour market, and the capital market. Naturally, that first market which predates modern production relations is related to demand-side economics, and what is mislabelled “supply-side economics” is the economics of those concerned primarily with the last market. Most modern labour economists, meanwhile, merely analyze the labour market from a supply-side perspective, while what insufficient normative or policy-related conclusions they have are too biased towards demand-side economics and aggregate demand management, like “full employment” stimulus spending betting on money multipliers here and there. All labour-related radical reform demands proposed in this discussion have in fact been proposed from a labour-oriented supply-side perspective of political economy. In the relationship between the labour and capital markets, the vulgar mantra that “businesses create jobs” (an indirect capital theory of value) does not hold water, since without the labour supply or labour market the so-called “innovative entrepreneurs” who still need to hire for a profit cannot realize their innovations. What follows are two more key proposals from a labour-oriented supply-side perspective of political economy, boosting the bargaining position of labour more directly, spilling or “trickling” over into consumer demand and savings. Fully extending the responsibilities of public-administered job search agencies and labour ministries overseeing them by reorganizing every single temporary labour agency into a monopoly under public ownership could result in economies of scale for payroll costs and help tackle the problem of structural and cyclical unemployment. With legislation and regulation around gainful wages and working conditions, extra support for temporary workers, and especially rules guaranteeing their ability to refuse lousy wages, lousy working conditions (especially unsafe working conditions), or both, such monopoly may even be the modern means to Hyman Minsky's realization of zero unemployment structurally and cyclically by means of expanding public services to fully include employment of last resort for consumer services. However, another policy is simpler, more radical, and less discussed: that “big government” should be the sole de jure employer, hiring all workers directly as a monopsony (with of course individual and collective ability to refuse jobs with things like unsafe working conditions) and contracting out all labour services as a monopoly to the private sector and to state enterprises and the rest of the public sector. This promotes gender pay equity and puts a practical end to wage theft such as back pay from small-business employers, which despite labour laws still occurs on the scale of many billions of dollars. The latter proposal ultimately opens up discussion to a whole range of labour policies.
Iron Laws, isn't that a Lassallian concept? I recall Marx criticized it quite harshly in Critique of the Gotha Programme. I'll admit that aside from the brief exposure in Critique of the Gotha Programme, I don't really know anything about Lassalle or his programme. I do know that he met with Bismarck, and that he died in a duel over romantic interests.. both of which tell me quite a lot about his character.
The Iron Law of Wages was Lassalle's terminology to describe something that was conceptualized before him: http://en.wikipedia.org/wiki/Iron_law_of_wages All he did was popularize the concept that real wages always tend, in the long run, toward the minimum wage necessary to sustain the life of the worker. However, my terminology refers to something entirely different. The "Iron Law of Disproportionate Immiseration" sounds more emotional than the colourless "relative immiseration/impoverishment" attributed to most Marxist economists. His meeting with Bismarck was a temporary coalition attempt in an unusual direction. The Popular Front is merely the latest in a whole line of coalitionist orientation with liberals, but Lassalle looked to nationalists, social conservatives, etc. precisely because his activity aimed at breaking the German working class away from liberal influence.
http://www.cpgb.org.uk/pdf/ww906.pdf Resort retort This past weekend Mr. Miliband proposed an under-25 employment program that would pay businesses the equivalent of the minimum wage to hire people under the age of 25 instead of perpetual unemployment insurance, a program to be funded by taxes on bank bonuses. Despite the back and forth between Arthur Bough and Mike Macnair that ignored the role of economic interventionism in favour of labour, only state policy can end structural and cyclical unemployment, only state policy can increase labour's bargaining power, and only state policy can increase real wages. This Labourite scheme is nowhere close to an employer of last resort (ELR) policy, though, which would: include those 25 and over, establish pay rates to living wage levels and more, not involve payouts of any sort to businesses (the ELR program is a direct employment program), and be funded by more substantively progressive taxation (not just income). Jacob Richter
