Chapter-by-chapter summary and brief discussion

Submitted by martin on 2 September, 2003 - 1:42

Discussion notes on the working class in "globalised" capitalism

"The End of Organised Capitalism": overall summary


The introduction stated the thesis: that capitalism has moved through a "liberal" phase (19th century), then an "organised" phase (late 19th century/ most of 20th century), into a "disorganised" phase (from late 20th century).
By "disorganised", L/U say that they do not mean plain randomness and entropy; however, their definition of it is mainly negative.
They flag up three main themes:
* Though they distance themselves from theories of "farewell to the working class", and state that working-class struggles may increase in disorganised capitalism, they see disorganised capitalism as bringing a "decline of working-class capacities".
* Bringing, also, a rise of the "service class" (professional-managerial). For the earlier part of the 20th century, L/U see this "service class", in the USA especially, more or less as previous writers have seen it, as a vector of "managerial" or "bureaucratic" reorganisation of society as against a previous regime of individual capitalist authority and more or less free markets. For the later part, they see it as operating in the opposite sense, as a vector of "disorganisation".
* Cultural changes accompanying disorganised capitalism.


Chapters 2 and 3 trace the rise of organised capitalism in each of five countries.
In Germany, L/U argue, "heavy industry [was] the motor of organisation at the top..."
In Sweden, "from the 1930s the labour movement was the motor for the organisation of the whole of Swedish society".
Of Britain, they argue at one point that "the main force behind bringing some organisation to the British state [were]... conservative imperialists" (in the early 20th century). Elsewhere they contend that "the two main agents effecting the development were... the... working-class movement and the social-liberal bourgeoisie". Their main argument about Britain is that because of its "middleman" position in the world economy, and the access of British capitalists to better-flowing markets, the move towards organised capitalist forms was slow and incomplete.
In France, also, the move towards organised capitalist forms was delayed by relative economic "forwardness". There, it was "the French state [that] developed very considerable levels of organisation".
In the USA, "a prematurely sizeable service class... functioned to spread a transformed and characteristically organised capitalist ideology..." L/U argue here that the political feebleness of the US working class was in part caused by the service class grabbing the role of democratic challenger to the unrestrained power of big capital.


Chapters 4 and 5 deal with spatial restructuring. L/U identify three trends in recent decades.:
* The expansion of, and relocation of industry to, smaller towns at the expense of big cities;
* Regional clusters of particular industries dissolving into a more uniformly variegated pattern; and
* Companies have more, smaller plants. (Example: the 100 largest enterprises in Britain in 1958 had an average of 27 plants each, and an average of 750 workers per plant; in 1972, they had an average of 72 plants X 430 workers each). L/U also mention the relative expansion of small firms, but note that many of these small firms are satellites, as sub-contractors or suppliers, of bigger firms.
All these trends they see as undermining the potential for the working class to act as a class-for-itself, by undermining the existence of large, more-or-less homogeneous working-class neighbourhoods.
They link this claim with the argument that there has been a rise of sectionalism in the trade-union movements.
In Britain, the big cities began to decline relatively, and manufacturing industry to move to previously rural areas, from the 1960s. There (as, so L/U note, elsewhere) the relocation was more than a byproduct of general industrial restructuring: cities with initially a more "favourable" composition of industry (more newer or expanding industries) declined relative to more rural areas with a less "favourable" initial composition (more older or declining industries).
In the USA, the suburbs began to grow faster than the central cities from the 1930s. Industry has been shifting to the "sunbelt" (in the south) since the 1940s.
The French economy was previously in many ways hyper-centralised around Paris, with industry in much of the rest of the country small-scale and geared to merely local markets. For a long time the trend was for the cities to gain relative to the countryside, and Paris to gain relative to the rest of the country. Since the 1970s that has been reversed.
Despite the high militancy of the French working class, French capitalists have never conceded a general system of collective bargaining of the sort which L/U consider typical of organised capitalism.
German capitalism was the same (little effective collective bargaining) before World War 1. Then there was lots of collective bargaining in World War 1.
"Counter-urbanisation" and the relative rise of small firms developed in Germany from the 1970s.
In Sweden, there was a relative rise of the smaller towns after 1970s. There has been some increase in smaller firms, but L/U report the Swedish economy as still exceptionally dominated by large firms.

1. L/U open chapter 4 by pointing out that the first sites of the Industrial Revolution in Britain were not previously-established large cities. So: is the recent move of industries out of large cities not a recurrence of a cyclical pattern generally typical of capitalism, rather than a novelty of "disorganised capitalism"? It is a pattern which recurs in waves, rather than going on almost imperceptibly all the time, because once a given pattern of industrial location has been established, then it has a power of inertia, and it requires economic crises and/or technological revolutions to budge it.
2. There is something a bit new. In the early times of the Industrial Revolution factories required a limited range of inputs so located anywhere that there was water-power to run the mills and some access. In the heyday of the big industrial cities factories required a wide range of inputs and could be sure of getting them only in the big cities. Now factories require a wide range of inputs and can get them in a wide variety of places.
3. Factories move to greenfield sites partly because rents are lower then in the cities? But why are the rents higher in the cities? Not because no-one wants to locate there. But because administrative/ service functions tend to cluster in the "central business districts". And so do administrative/ service workers.
4. The activist left, in many countries anyway, is heavily concentrated in the inner suburbs of big cities, for obvious and relatively good reasons. That means that it becomes based primarily on service workers and neglects factory workers who live and work elsewhere. Is there anything to be done about this other than developing the inner-city left to sufficient strength for it to send out missionaries to the outlying suburbs and small towns?
5. Up to a point larger workplaces are an advantage for working-class organisation. But does the rule the larger the better continue indefinitely? L/U themselves note that historically in both France and Germany the larger factories have on the whole been less militant. Conversely, there are plenty of examples in working-class history of strong and militant organisation in industries with modest or small average workplace sizes: rail, bus and metro workers; coal miners; seafarers; building workers...
6. L/U also note that in Germany in World War 1 "each worker spent no more than one year in any single job". This indicates that high mobility of labour does not necessarily block militant or even revolutionary class consciousness. In fact very low mobility of labour can very well breed staidness and inbred acceptance of the status quo.
7. L/U open these chapters with flat assertions about what is necessary for class-for-itself worker consciousness. Are those assertions well-grounded? Or based on a false stereotype of militant and revolutionary working classes being made up of the large homogeneous "masses" beloved of Stalinist and social-democratic leaders? Remember, for example, that the coal miners in Britain were by no means always particularly left-wing or militant. They remained solidly Liberal until 1908 while the more mobile and more widely spread railworkers pioneered independent working-class politics... In the 1970s it seemed to me that the militants among coal miners were often people who had moved from one area to another (as a result of redeployment when pits shut down) rather than those with the strongest local community links.
8. Here (and it comes out more later on) I think L/U are too influenced by the Marxism Today writers, which used a stereotype of an effective working-class movement as made up of homogeneous disciplined masses (with people like the writers themselves directing them), and saw more unruly militancy as necessarily ineffective and harmfully "sectional". L/U claim that "sectional competitiveness has become far more marked" among trade unionists, but do not prove their case. Where trade unionism is weaker, there is, of course, a tendency to retreat into trying to save one's own corner rather than venturing on larger aims, but is there more aggressive craft-aristocratism than there used to be? More aggressive differential-seeking? More "self-vanguardism" (the idea that your particular section is the vanguard, and never mind about the rest, they'll catch up in time). And hasn't the problem of trade unionism in the last couple of decades been as much not enough "sectionalism" (e.g. too-ready acquiesence in the Accord, supposed to serve the general interest at the price of some sectional setbacks; swallowing-up of "sectional" unions into portmanteau conglomerate unions, etc.?
9. Points for further empirical investigation.
* Have the trends identified by L/U continued since? On casual observation they have, to a large degree anyway. But, for example, some large cities, London for one, have had a regrowth of population.
* Have those trends operated in Australia, and to what degree?


Chapter 6 is about the "service class". (The term originates from the Austro-Marxist Karl Renner - see note on p.348. Further investigation: what did Renner mean by it, why did he see a need to coin the term?)
L/U mean the professional and managerial layers. They consider this group to be a "causally powerful" one in capitalist society, i.e., presumably, one with large capacities to define its own distinctive aims and enforce them.
They further claim that: "The rise of modern management involved a substantial break in the logic of capitalist development, and was by no means inevitable... there was in effect something of a 'class struggle' in American society around the turn of the [19th/20th] century... [it] was a struggle between existing capital and 'modern management'. In that struggle existing capital lost".

Comment: Some questions are raised immediately.
1. On L/U's account, the service class is a vector of organised capitalism, in the USA at least, in the first part of the 20th century; but then becomes a vector of disorganised capitalism. To my mind they never really explain this supposed turn-about. (For what appears to be their nearest approximation to an answer, see below).
2. Moreover, (on L/U's account) broadly the same as what the service class did (on their account, again) in promoting organised capitalism in the USA was done by other social forces (heavy industry, labour movement, etc.) in other countries before (yet again, on their account) any forceful service class existed in those countries.
3. So? Maybe it's not true that the service class is, by its structural position and nature, the bearer of a particular social and political programme in the same way that the bourgeoisie and the working class are? Maybe in fact it is true that the service class is a congeries of auxiliaries and side-riders of capital, diffuse and dependent by its very nature?
4. If the rise of a service class is a break or detour in the logic of capitalist development, one which arises from a struggle being waged and won against existing capital, then we would expect to see contrary examples, of capitalist societies where the struggle was not won and the "unbroken" logic of capitalist development worked itself out. In fact, L/U's account is that a service class was developed, eventually, in all the countries they mention - and in no case but the USA do they make any attempt to show that a struggle against existing capital was necessary to bring that service class into existence.
5. How could large capitalist enterprises, drawing a variety of inputs from a variety of sources, using constantly-changing technology, and marketing their products worldwide, operate without a large administrative and managerial staff? How could they operate in the ways suitable for enterprises using a small, stable set of inputs, a more-or-less fixed labour process, and marketing their products locally to known customers? How could a modern capitalist state, organising a vast range of infrastructure for capitalist enterprise, operate in the manner of the "night-watchman" state of idealised liberal capitalism? L/U do not establish their case that capitalist development could have proceeded with an "unbroken logic" without any variety of "scientific management".

Further on chapter 6: L/U start by describing the rise of Taylorism in the USA, in the first two decades of the 20th century. Taylorism meant management gaining control of the labour process and deliberately planning and re-planning it, so that new workers could be fitted into job "slots" known and designed by management.
Taylorism flourished in the USA much more than in other countries. This was associated with a great rise in the USA's number of qualified engineers, from 7000 in 1880 to 136,000 in 1920; the rise of schools of management and business in the USA much earlier than elsewhere (Wharton School founded 1881); and a general earlier rise of mass higher education in the USA than elsewhere. "By 1928... 15% [of US whites went to college] and the USA possessed more institutions of higher education than France possessed academic personnel". The proportion of administrative staff to production employees in industry rose in the USA more, and earlier, than in other countries.
The new trained, educated sections of the workforce had more clout because the development of new universities and colleges, and the processes of professional accreditation, in the USA, were not locked into old elitist/ hierarchical structures as they generally were in the European countries.

Comment: A lot of these trends were well-established before, say, 1909, and therefore also before Taylorism as such was widespread. So Taylor was a particular figure in an organic trend, rather than representing an attempt to break the logic of capitalist development?
Much of what's special about the USA here must be to do with it being a country of immigrants with relatively weak traditional hierarchies, where, therefore, the Napoleonic "career open to the talents" was a much more real prospect than in the USA.

Further on chapter 6: "Opposition from existing employers and managers [to Taylorism] was extremely widespread... The experts encountered more opposition from managers than workers".

Comment: This falls short of establishing that there was a class struggle between the engineers and the capitalists. With managers, Taylor and his friends had to convince them to choose new methods and labour to impose those methods. It is not surprising that existing managers should dislike new methods which, maybe, seemed to give them more tasks and make them work under more pressure. With workers, no process of convincing them freely to choose Taylorism was necessary. Once their bosses had adopted Taylorism, for the workers it was a fact of life which they could either resist by militant action (as, on L/U's account, they sometimes did) or accept as an unavoidable imposition and then "work around".

Further on chapter 6: L/U explain the periods when the US state has shown some relative autonomy from the immediate wishes and desires of the majority of big business from the clout of the service class. They refer especially to Wilson's presidency, the New Deal, and the Kennedy and Johnson presidencies.

Comments: New Deal, maybe, but what is the evidence for any substantial autonomy in the other periods?
Why should the relative assertiveness of the service class have suddenly sprouted in the New Deal period?
L/U have already shown that Progressivism - which they identify as the characteristic ideology of the service class - was closely tied to big capitalist interests.
Isn't it more likely that the relative autonomy of the state in the New Deal period - i.e. the drive by the state to implement policies which the top leaders saw as necessary for long-term capitalist well-being, even if they ran against the immediate wishes of most individual capitalists - was generated by the sheer fact of deep capitalist crisis? And also partly by the state's need to respond to and "contain" the working class? L/U dismiss the latter factor. "The main initial burst of public spending - in the New Deal - was less than elsewhere the initiative of working-class organisations, or even of government in response to the threat of working-class struggles" (p.381). But the rise of the CIO was no mean movement.

Further on chapter 6: In the UK, by contrast to the USA, the rise of scientific management was very slow. Britain had "no 'service class'... until arguably the 1960s", and even then it was "very much state-sponsored". "British professions followed the gentry model of 'status professionalism' rather than the bourgeois one of 'occupational professionalism'."

Comments: What about the professional civil servant/ colonial administrator/ military officer class which had emerged by the late 19th century? There may be good reasons for supposing that it was more subservient to traditional elites and more amateurish than the USA's managerial/ professional class, but that is not the same as saying that it didn't exist.
Later on in the book it seems that L/U are "reading back" their history of the service class from their perception of the Guardian-reading "chattering classes" in 1980s Britain...

Further on chapter 6: Germany was the most Taylorist country after the USA. It, too, expanded scientific and technical higher education. But: "Unlike the USA... as 'new' professions developed... they adopted the model of professionalisation provided by the existing 'old' professions....", and so were less autonomous.
L/U adjudge the Nazi period - often held to be a high point of the ousting of traditional liberal capitalism by bureaucratic regulation - to be one which "constrained the growth" of the bases of the service class. They cite particularly the decline in Germany's number of university students in that period.

Comment: But Nazi Germany did actually have large numbers of administrators and officials... The same problem here as with L/U's refusal to see a "service class" in Britain until the 1960s?

Further on chapter 6: In Sweden, and in France too, the decisive rise of the service class came after World War 2.


Chapter 7 contains two distinct parts. The first part summarises some widely-discussed economic trends. Factories produce more varied products for different market segments and different periods - do more "batch production" - instead of producing a smaller range of standard and slowly-changing products for an undifferentiated mass market. At the same time markets have been cosmopolitanised. You can choose from a wider variety of ready-made clothing, but a similar variety across a wide range of different countries.
Banking and finance has becoming more internationalised, and thus more autonomous from the particular industrial companies located in the banks' home countries.
This new world financial system is, potentially, very unstable.
The second part pursues a quite different argument about political changes.
L/U argue that there has been a "class dealignment" of voting. Voting is less tightly correlated with social class; voters are more volatile; more people don't vote at all. At the same time as that erosion of mass politics, there has been a rise of micro-politics, in "new social movements", small specialised political pressure groups, etc.

Comment: The argument in this chapter is much looser and less empirically grounded than in the previous chapters.
Impressionistically, it seems true that there is a widespread decline of deference and of respect for the large-scale, established political formations, and a growth not so much of direct alternatives to them as of smaller, specialised, more diffuse campaigning groups which "work round" them. (Question: how to check out this impression more rigorously, with empirical data?)
To read these trends as an organic decline of class politics is, however, a bit too rapid. In Britain, for example, such trends have proceeded at the same time as the number of people identifying as "working class" and the number of people saying that there is a "class struggle" in society has risen markedly.
Perhaps the problem is L/U ignoring the specific character of the old established "working-class" political formations which working-class people have become less solidly attached to.
In many countries, in the periods of the first formation of the working class (Germany, Sweden) or in wartime (Britain, France) Social Democratic parties, or Social Democratic parties flanked by Stalinist parties, acquired a hegemony over the working class, and one sufficient to allow them to draw within their ambit many specialised concerns. (Famous example: the pre-1914 German Social Democratic cycling clubs, choirs, and so on). But those parties have been losing the political "capital" they built up in past decades (e.g. after 1945) and becoming more and more bureaucratised and integrated into a game of politics dominated by the capitalist media. Everywhere rank and file stirrings in those parties in the 1970s were seen off, and in the 1980s those parties became agencies of neo-liberal structuring - to one degree or another.
To form comprehensive alternatives is a huge task. No wonder, then, that many activists opt for conducting their politics in bite-sized chunks.
It does not follow that bite-sized chunks are the most effective mode of politics, or that the task of creating new mass workers' parties is impossible or can be abandoned.


Chapter 8 argues that there is structural, organic, long-term tendency to the fragmentation of trade union movements, built into disorganised capitalism.
L/U start by defining a model of "corporatist" industrial relations, in which "the organisations in civil society [of employers and of workers] control their membership and accept reasonable settlements in a spirit of 'national unity', in exchange for which [they] are given considerable powers within the state apparatuses".

Comment: There is already a problem here. There is a variant where labour is excluded from the "corporatist" structures. L/U recognise it as having existed for example in Vichy France, in Nazi Germany, and to a substantial extent in post-1945 Christian Democratic Germany and in Gaullist France. This variant of "corporatism" shades over into "ordinary" cooperation and lobbying between big business and the state machine.
But it is not clear to me that "tripartite" corporatism ever really existed. It was proposed in various countries - from Germany (Concerted Action) in 1967 to Australia (the Accord) in 1983 - as part of the first wave of capitalist attempts to restructure as the world economy moved into turbulence. But, before it was openly renounced in favour of neo-liberalism, or gradually shaded over into that same neo-liberalism, did it ever acquire any real clout? Was it ever any more than a time-gaining way for the capitalists to fob off the labour movement, diffuse struggles, and buy off a few leaders?
It is true (I think: check?) that there has been a pretty widespread movement from centralised, large-scale collective bargaining over wages and conditions to company-level or plant-level bargaining.
Why? A lot of collective bargaining was initiated in wartime, when predictability and control seemed worth maybe paying a bit over the odds for, and in any case labour shortages put employers at a market disadvantage.
In a period of relatively gradual technical change, stable markets, and low unemployment, to continue with large-unit collective bargaining makes sense for employers.
With rapid technical changes, rapid shifts in markets and the risk of rapid incursions by competitors, and high unemployment, the employers' desire for "flexibility" (as they always tell us), and their ability to obtain it, increase. They are prepared to risk the overhead costs of a more fragmented system of industrial relations.

Further on chapter 8: L/U argue that the "substantial mobilisation of workers in the late 1960s, especially young workers developing a radicalised popular-democratic consciousness", and "the substantial growth of a militant public sector" actually "undermine[d ] working-class.... organisation and cultural resources". It thus undermined "corporatism" and (implicitly) opened the way for neo-liberalism.

Comment: This seems to be L/U swallowing too much Marxism Today stuff again, on how working-class militancy in Britain in 1978-9 brought Thatcherism on us. If it is true, it is surely true only in the sense that if there had been no working-class militancy in the 1960s and '70s, then the capitalists would have felt less need for a counter-offensive and for revenge....

Further on chapter 8: L/U follow up with a detailed discussion of the evolution of Swedish industrial relations. (They discuss no other country in comparable detail).
Sweden had a strong centralised employers' federation, and a strong centralised union federation for manual workers, very early on, from the start of the 20th century. Their power was reinforced by 1928 legislation forbidding strikes during the life of a collective agreement. [[And lockouts too? They don't say]].
There were centralised wage bargains from 1938 and through World War 2, and then from 1952 to 1982. The LO consciously worked to reduce pay differentials.
The system began to break down because white-collar unions had become stronger and more assertive. In 1971-3, 1975-6 and 1980 the public-sector white-collar unions jumped the gun and gained large wage rises which then became the target for LO's negotiations. The old system of blue-collar workers in large-scale export industry being the pace-setters began to break down.
The public-sector white-collar unions were motivated by a desire to catch up with wage-drift between central negotiations, which was allowing the private-sector blue-collar workers to outstrip them. [[Which presupposes that wage-drift was increasing, due to more rank and file militancy among the blue-collar workers?]]
In 1983 the employers attempted a counter-offensive, and managed to force separate agreements with the metalworkers and with the private-sector white-collar workers. The metalworkers' union agreed a separate deal for fear of losing more members to the white-collar unions. In 1984, each union made its own bargain, and for different periods.
But in 1984 also the LO unions devised a strategy to restore centralised bargaining. In 1985-6 there was a centralised bargain.
White-collar unions have been growing relative to LO, and organising themselves more for bargaining.
A main actor inside LO is Sweden's largest union, the Municipal Workers' Union, SKAF, which "is 80% female, 50% part-time, yet recognised as highly effective... 40% of its members are under 30".
[[What has happened since? White collar workers must now be the majority in Sweden. Any moves to unity between LO and the white collar workers' organisations? What has the effect of privatisation and contracting-out been on the public-sector unions?]]
In Germany, "in the early 1950s... bargaining remained decentralised". The works council law of 1952 was "a highly conservative piece of legislation, which constitued part of an employers' and Christian Democratic offensive against the resurgent post-war left..." Moves towards it later in the 1950s, pushed by the right wing of the DGB. 1967: the establishment of "Concerted Action" under the Grand Coalition government.
Then "a wave of wildcat strikes in 1969 and the highest strike rates yet recorded in the Bundesrepublik in 1971. Another qualitatively more substantial ripple of industrial disruption... followed in 1973".
"The irony is that... this 'great mobilisation'... may have had the effect of fragmenting German industrial relations..."
1970s pressure for "codetermination", which "has disorganising potential for German capitalism" because of localising decision-making. [[But is that what has actually happened, rather than "co-determination" being a dead letter?]]
1984: large, and more or less successful, struggle by IG Metall for reduced working time.
Meantime, however, shift of government (and Social Democratic: Helmut Schmidt) policy towards neo-liberalism. 1976: Concerted Action talks peter out, after a DGB walkout provoked by employers.
L/U conclude that "the trade union movement seems to be well placed as a force to be reckoned with in West Germany's... disorganising capitalism". Why? Because "primary labour market workers" ("male, skilled, private-sector") have been "willing to sacrifice sectional interests for a much more general interest". [[Has experience since actually confirmed this? By what means can the "primary" workers ensure that the benefit from their "sacrifices" accrues to the "general interest"? Isn't the general experience of the last 20 years that the "primary" workers have seen as much or more degradation of pay and conditions as the rest?]]
France: corporatism with labour excluded up to the end of the 1960s.
In the ferment of the late 1960s, "in order to once again become a national political force, the left had partly to separate itself from the working class" (i.e. via the rise of the CFDT and the "new" Socialist Party). [[Isn't this a "tendentious", ideological misreading of the decay of French Stalinism and the ability of Mitterrand to capture some of the ground cleared by that decay?]]
[[L/U discuss the experience of the Mitterrand government all in terms of "the possibility of a gradualist transition to socialism" etc., and how it failed. Though they conclude that the chief factors were that "by 1978 employers were not in the slightest interested in 'contractualism'..." and changed world-market conditions meaning that "national economic integration.... seemed excluded from the agenda", so that the attempted caused "unbearable strains", the vision skews their whole discussion. The question in the back of their minds seems to be: how best could the unions have helped the Mitterrand government to bargain through a gradual transition to socialism?]]
Britain: here too L/U see a process of "the organised capitalist consensus [being] challenged" both "from the left... through decentralised militancy" and from the right, through neo-liberal offensives driven on by the internationalisation of capital.
L/U recount that previously British industrial relations were not "corporatist" but organised in the sense of "national branch bargaining" since the period between the two World Wars. "Neo-corporatist" efforts in the 1960s and 70s failed: governments did not deliver because of world-market pressures, union did not deliver because of rank and file militancy.
L/U see a drift to "dualism", meaning a "schism between dynamic private-sector exported-oriented firms which bargain on a plant or company level and... the public sector... and most declining sector firms... which bargain at a national level". [[The implied thought seems to be that the "primary", manufacturing-for-export workers can win relatively good wages and conditions by sectional action, while the rest languish. In fact that is not how things have turned out. In many ways public sector workers, retaining some trade union organisation, have done better than those "primary" workers. Check facts?]]
USA: L/U argue that in the USA there has never been much corporatism - or much of a cohesive, strategically-minded trade union movement [[they seem to assume that a a cohesive workers' movement with large "capacities" can exist only through "corporatism". In other words, in all their discussions of working-class "capacities", their measuring rod is the ability or otherwise of the working-class movement to negotiate and haggle through some sort of