In order to develop political agendas, aims and strategies for
the labour movement, it is decisive to analyse and learn from its
history. We cannot understand the current situation if we do not
understand power, power relations and the political economy of the
welfare state. In the European context in particular, this includes
an analysis and understanding of the social pact, of the historic
compromise between labour and capital – including the effects of
this compromise on the policies and ideology of the labour
movement. In this contribution I will try to establish some
linkages which I think are important for the understanding of the
current state of play in the trade union and labour movement.
The political economy of the welfare
state
Ever since capitalism became the dominant mode
of production in our societies, it has developed from boom to bust,
from bust to boom. The relatively unregulated laissez-faire
capitalism of the 19th and first half of the 20th century
represented strong exploitation of workers in general, and caused
extraordinary misery during its bust periods. The response of the
working class became to organise and fight – at the workplaces as
well as at the political level. Through this fight the labour
movement was able to achieve better wages, better working
conditions as well as high quality social welfare provisions. The
welfare state was developed. A great part of the movement initially
turned politically to socialism as the necessary means to end
capitalist exploitation.
It was the enormous shift in the balance of power in society, in
favour of labour, which made this development possible. It is
important to notice that this increased strength of labour was not
only reflected in labour laws and regulations. Even more important
was the general taming of market forces. The power of capital was
reduced in favour of politically elected bodies. Competition was
dampened through political interventions in the market. Capital
control was introduced and financial capital became strictly
regulated. Through a strong expansion of the public sector and the
welfare state, a great part of the economy was taken out of the
market altogether and made subject to political decisions. Thus,
the strategy of the reformist labour movement became not to
democratise the ownership of the means of production, but to
delimit the political power of capital. This general taming of
market forces was a precondition for the development of the welfare
state, and the resulting comprehensive regulatory framework was
more important than labour legislation in providing better working
conditions.
Capital control, in particular, made it possible for governments
to pursue a policy of national and social development without
continuously being confronted with capital’s exit strategies where
big corporations threatened to flag out, to move to other countries
with more favourable conditions, if their interests were hurt.
The social pact and its ideological
legacy
During the last century, the social struggle
between labour and capital in many countries turned into static
warfare in which none of the parties were very successful in
advancing their positions. The labour movement was not able to
capture new power positions and capital forces were not able to
defeat the workers’ organisations. As a result of this, the trade
union movement gradually developed a sort of peaceful cohabitation
with capitalist interests. In the 1930s this cohabitation started
to become institutionalised in some parts of Europe when the trade
union movement stroke accords with employers’ organisations,
particularly in the North, and after W.W.II also in most of Western
Europe. From a period characterised by hard confrontations between
labour and capital, societies entered a phase of social peace, bi-
and tripartite negotiations and consensus policies. This social
pact between labour and capital formed the basis on which the
welfare state was developed and working conditions were gradually
improved.
It is important to realise that this social partnership between
labour and capital was the result of the actual strength of the
labour movement – a strength which was developed through the many
struggles and confrontations between labour and capital in the
previous period, including the Russian revolution and thus the
existence of another economic system in the East. As the British
historian Eric Hobsbawm has pointed out, this created fear among
capitalists in Western Europe and made them give in to many social
and economic demands from the labour movement in order to dampen
its radicalism.
Due to important achievements in terms of welfare, wages and
working conditions, the policy of the social pact gained massive
support from the working class, and the more radical and
anti-capitalist parts of the labour movement were gradually
marginalised. Combined with the dominant conception that
free-market capitalism was defeated, this development led to the
depolitisation and deradicalisation of the labour movement and the
bureaucratisation of the trade union movement. It became the
historic role of the social democratic parties to administer this
policy of class compromise.
Based on real experience of continuous improvements in living
and working conditions the common understanding which developed in
the labour movement was that a way had been found to a society
which brought social progress and a relatively fair distribution of
wealth to ordinary people – without having to make all the
sacrifices connected with class struggle and social confrontations.
The dominant apprehension was that society had reached a higher
level of civilisation. Through gradual reforms the labour movement
had increased democratic control of the economy. The crisis-free
capitalism had become a reality. No more economic crises like that
of the 1930s, no more mass unemployment, no more social distress,
no more concentration of wealth among the rich and privileged, no
more misery among people. All social trends pointed upwards. For a
great many in the labour movement this was the reformist road to
socialism – and it was for everybody to see that it worked! These
social achievements formed the material basis for a social
partnership ideology which became, and still is, deeply rooted in
the national and European trade union movement.
We should also bear in mind that the welfare state was not, from
the very beginning, the final aim of the labour movement, not even
the term welfare state was invented at that time. Socialism was the
aim, while the welfare state was the result of a compromise – the
historic compromise between labour and capital. This is also
reflected in the different characteristics of the welfare state. On
one hand, part of it represents the seeds of our vision of another
society. On the other hand other parts work as the repair workshop
of a brutal and inhuman economic system. To put it bluntly, the
welfare state was what the working class achieved in exchange for
giving up socialism.
The neo-liberal offensive and the breakdown of the
social pact
The politics of the social pact
culminated in the 1970s. Then, in the aftermath of a deep
international economic crisis, market forces went on the offensive
and the current era of neo-liberalism started. Two parallel
historical processes came together and made this offensive
possible. One was the economic crisis, which made capitalists and
governments take action to restore profitability, the other was the
depolitisation and deradicalisation of the labour movement. This
opened an opportunity for capital owners to gradually withdraw from
the social pact and start to attack labour laws, agreements and
power positions which were won during the welfare economy, and
which at that time were accepted by the employers as part of the
compromise.
What we have been facing over the last twenty years, is
therefore the abolition of capital control, the deregulation and
liberalisation of markets, the redistribution of wealth, the
privatisation of public services, the increased use of competitive
tendering and outsourcing, the downsizing of the workforce to the
absolute minimum and the consequent increasing labour intensity,
and the flexibilisation of work. Most of the complex system of
regulatory means which were used to tame the market forces, and
thus to create the preconditions for the development of the welfare
state, have simply been removed. This policy of deregulation has
led to the development of a completely crazy, speculative economy,
in which more than 90 per cent of international, economic
transactions are speculative, mainly currency speculation, and to
an unprecedented redistribution of wealth – from public to private,
from labour to capital and from the poor to the rich. The
redistribution model of the welfare has, in other words, been
turned upside down. Working conditions and social welfare have as a
result come under enormous pressure.
In this way, most of the economic and material basis on which
the welfare state was developed, is simply gone. The power basis of
the class compromise has eroded, and capitalist forces have
withdrawn from the social pact. In other words, bi- and tripartite
negotiations do not any longer work the same way as they did during
the social pact period. The trade union movement was taken by
surprise by this development. The shift from consensus to
confrontation on the side of capital was incomprehensible within
the consensus-oriented policy of the labour movement. The breakdown
of the historic compromise therefore also led to a political and
ideological crisis in the social democratic parties and the entire
labour movement. With a depoliticised and passive membership, and
an increasingly self-recruiting leadership which was moving into
the elite of society, social democratic parties rapidly adapted to
the dominant neo-liberal agenda. What once again took place was a
formidable shift in the balance of power between labour and capital
– but this time to the benefit of capital.
The brutalisation of work and the erosion of the welfare
state
This new balance of power has led to a serious brutalisation of
work. An increasing number of workers is being excluded from the
labour market declared disable to work. We experience an all-time
high in sick leave, as well as an increase in occupational injuries
and accidents. A growing number of workers experience increasing
stress and so-called chronic fatigue syndrome at the work place. In
many industries and sectors workers experience degradation of work,
with less influence over the work process. In short, there are many
signals that something dramatic is about to happen to our labour
market and to our whole relationship to work.
Many people have therefore experienced in the past years that
the work pressure has become tougher, that labour laws and
agreements are often undermined and put aside in the daily work and
that insecurity and uncertainty have increased. A rapidly growing
number of workers are being excluded from the labour market
altogether. In Norway, almost 15 per cent of the total population
between the ages of 16 and 67 – the latter being the ordinary age
of retirement – are now on early retirement, disablement benefit or
some kind of rehabilitation. The figure has doubled over the last
20 years. At the same time, trade union and labour rights are being
weakened and undermined. There is no doubt, then, that a serious
brutalisation of work is going on.
This development takes place in a society in which we, at least
in the industrialised world, for a long period experienced a
gradual improvement of working conditions – a development which
included shorter and better regulated working hours, longer annual
leave, better job security, the introduction and improvement of
sick pay, a reduction in work intensity, less stress, the removal
of many health hazardous workplaces, and the development of
gradually better working environment legislation. This developed in
parallel with a high level of employment, improved trade union
rights, increasing co-determination in the workplace and in the
companies, etc. Those were the golden years of the welfare
economy.
I do not with this say that we did have an ideal working
environment. Far from that, there were many problems and challenges
ahead. What I do say, is that we had a positive development.
Working conditions and working environments were gradually being
improved. That is no longer the general trend. The shift in
development is so formidable that workers’ human dignity is being
heavily attacked.
The increased exclusion from the labour market does not take
place because there is a general deterioration of workers’ health.
The problem is related to increasing demands at work. Workers are
being excluded at an earlier stage than before. Due to increased
competition, more rapid restructuring of companies and public
undertakings and changing working relations, less control over the
work process, the demand on workers is becoming more and more
intolerable. At the same time research and experience prove that
measures taken by politicians and public authorities to stop and
reduce this exclusion from the labour market have failed all over
Europe.
From my point of view, this is not a big surprise. If you do not
analyse – or if you even deny the existence of – the power
structures and the driving forces which lay behind the ongoing
brutalisation of work, you will never succeed in fighting it. There
are causes and there are effects, and if you want to influence the
effects, you will have to attack the causes. That is not being done
by our politicians and public authorities today. They are
scratching on the surface and attacking the symptoms rather than
the causes – and their results are vain. On the contrary, through
their welfare-to-work policies and their attacks on sick pay and
social benefits they are spreading a climate of suspicion, disgrace
and humiliation. They are individualising and privatising the
problems. Workers are made believe that it is their own problems
that they are being excluded from the labour market. «It is me who
is not good enough and cannot master the new demands in the labour
market». Jean-Marie Le Pen, Jörg Haider, Pia Kjærsgaard
and their likes should thank these politicians in their evening
prayers every day of the year – because this is really fuelling
right wing populism by undermining the human dignity of workers and
alienating them from work and society.
Mainstream media ideology on individualisation underpins this
development. Increasing individualism and egoism are being used to
explain why collective values are loosing ground in our
(post)modern society. At least in the trade unions, in the labour
market, my experience is opposite. Workers want collective
solutions to their problems. It is when collective solutions break
down that workers turn to the only existing alternative, to solve
their problems individually. In other words, collective values do
not break down because people are becoming more individualistic. It
is the other way round, individualism grows because collective
solutions are breaking down. If you have to turn to individual
solutions, then trade unions, politicians and public regulations
easily becomes problems rather than instruments, among other things
because they restrict your ability to work as much overtime as you
want in order to earn more money so that you can cope with ever
increasing cost of living.
The ideology of the social pact is able neither to explain nor
to develop counter-strategies against this development. Under the
welfare economy there were direct inter-links between economic
growth and better living and working conditions. These links are no
longer there – the economy grows, but it leads to setbacks rather
than to progress. The entire concept of the welfare state, the
consensus policy, is breaking down – without being replaced by
another with better ability to analyse and explain current
political and economic developments. This is extraordinary
important. If the entire concept of how society works has broken
down, what are you then left with? At least an openness to other
ways of interpreting social development. If the only alternative at
hand is right wing populism, because the trade union movement as
well as the previous broad political left have become a part of the
«establishment», then obviously many workers will turn to right
wing populism.
The right wing populist «solution»
The new, neo-liberal power relations have led to a comprehensive
setback for the trade union and the labour movement. In spite of
economic growth, working conditions are being brutalised, trade
union rights and social welfare are being undermined, the really
existing welfare economy is breaking down. Now, more than 50 years
after the development of the social pact and the welfare economy,
we have to admit that the capitalists succeeded in their strategy.
By giving in to many of the demands of a well-organised working
class, they succeeded in deradicalising and depoliticising the
labour movement, but without giving up the basics of their economic
power. It is possibly a hard judgement for many, but I think that
we have to admit that the ideology of the social pact has proved
wrong. Nothing less than that!
In the trade union and the labour movement we have to ask
ourselves – why did this policy fail? What went wrong? Part of the
answer is that the social pact itself was not a stable situation,
it was a compromise in a specific historic situation. Something
which could have been a successful, short term, tactical
compromise, gradually became the final aim of the labour movement.
Since the social democratic parties became the bearers of the
policy of the historic compromise between labour and capital, the
breakdown of the social pact explains why these parties have been
and still are in a state of deep ideological crisis.
In this situation, a great part of the workers feels betrayed by
their political representatives – they «do not any longer recognise
their (social democratic) party.» On the contrary, many workers
increasingly identify the labour parties as well as the trade union
movement as parts of the «establishment» – which has distanced
themselves from the reality and the daily lives of ordinary people.
It has become the role of the right wing populist parties to
exploit this discontent, people’s political confusion and
increasing feeling of powerlessness. These parties offer simple
solutions, criticism of the traditional politicians and even a
political perverted form of system-criticism with a strong appeal
to alienated and excluded people who feel more and more powerless
in a society with ever more self-confident and self-sufficient
economic and political elites that are increasingly growing
together. The right wing populist parties do not, however, mobilise
people against the social forces behind the brutalisation of work
and the attacks on the welfare state, they channelise workers’
discontent against other social groups – such as «those who take
our jobs» (immigrants), «those who are a burden on society» (lonely
parents, people on welfare) and «those who impose ever higher
taxes» or «pursuit their own privileges» (politicians).
This is not a necessary development, of course, it is the result
of a historic specific development which is possible both to
analyse and to understand. When workers are being attacked,
oppressed and humiliated, their anger is being directed against the
existing society, and they are starting to look for alternatives,
for more radical solutions. Again, if the only «credible»
alternative on the market is right wing populism, then many
depoliticised workers tend to follow that path. If there are
«credible» left wing alternatives, we can experience a political
polarisation, as has been the case in Norway over the last couple
of years. Here we have seen a considerable growth of the Socialist
Left Party as well as the Progressive Party (the right wing
populist party), while the Social Democratic Party has lost a great
part of its support among workers.
Whether we like it or not, reality is that we are moving from
consensus to confrontation. We had rather be prepared. The social
forces which want to defend decent working conditions and public
welfare will therefore have to meet the confronting attacks from
the state and capitalist forces with a counter offensive. Great
parts of the trade union movement have not yet realised this.
Demands for a new class compromise, obviously with a nostalgic hope
that the social peace and the gradual improvement of social
conditions of the 1960s should be restored, do not have any
realistic basis under the current balance of power. The only way to
meet this political challenge in the labour movement is therefore
through a more radical and system-critical policy, which is able to
analyse and explain the breakdown of the social pact and the
fundamental social contradictions in our societies – as well as to
develop a strategy in which people’s discontent and anger are taken
seriously, politicised and turned into a collective struggle for
democracy, solidarity and social welfare. In this struggle, the
trade union movement should also build alliances with the new
global movement for solidarity and justice, the social forum
movement, which has developed so rapidly over the last few years.
Such alliances could contribute to the revitalisation and
radicalisation of the trade union movement, which is necessary if
we really want to contain the attraction of right wing populism in
the working class.