Workers’ control and socialism

Submitted by Anon on 12 April, 2006 - 6:11

By Paul Hampton

“Control lies in the hands of the workers. This means: ownership and right of disposition remain in the hands of the capitalists. Thus, the regime has a contradictory character, presenting a sort of economic interregnum…

“In a developed form, workers’ control thus implies a sort of economic dual power in the factory, the bank, commercial enterprise, and so forth.

“If the participation of the workers in the management of production is to be lasting, stable, ‘normal’, it must rest upon class collaboration, and not upon class struggle. Such a collaboration can be realised only through the upper strata of the trade unions and the capitalist associations. There have been not a few such experiments: in Germany (‘economic democracy’), in Britain (‘Mondism’), etc. Yet in all these instances, it was not a case of workers’ control over capital, but of the subserviency of the labour bureaucracy to capital. Such subserviency, as experience shows, can last for a long time, depending on the patience of the proletariat.”

Leon Trotsky, Workers’ Control of Production, 20 August 1931, from The struggle against fascism in Germany

Workers’ control is being eagerly debated by the left in Latin America at the moment. There are some hundreds of factories in Argentina, Venezuela, Brazil and elsewhere across the continent where factories have been closed or abandoned by the bosses, only to be taken over by workers.

Some of these factories have been nationalised by governments desperate to reassert some control. In some cases the courts and the police have tried to force workers out. Some factories are run on more less capitalist lines while a few have established democratic assemblies and delegate based managerial structures to run the plant without a boss. Others have become cooperatives and still more have representatives on management boards.

Zanon

Perhaps the most important example of genuine workers’ control at present is the Zanon ceramics factory in Argentina. Zanon represents in microcosm, in embryo, what socialists want for the world. Workers have occupied the factory for four years after bosses deserted it. They are running it completely without bosses

The assembly is the central democratic organ that runs the factory. It is a gathering of all workers and meets every month to decide on the direction of the factory. The factory is divided into sections – sales, planning, buyers etc. Each section elects representatives who sit on the coordinating body. These reps, known as coordinators, are respected and trusted by fellow workers in their section. The coordinators meet every Monday. They earn the same salary as other workers and have no extra privileges. There can be an election at any time to replace a coordinator. They also rotate positions of responsibility.

Zanon workers want the factory to be nationalised under workers’ control. Last year they managed to get the factory registered as a cooperative, called FaSinPat – Fábrica Sin Patrones (factory without bosses) — with a statute to work for a year. It might be extended. But they are still effectively illegal.

At present, there are around 300 workers in the Zanon factory, which is operating at about 15% capacity. They took on 30 unemployed workers. About 15 are women. They run a newspaper, Nuestra Lucha, a radio station and a website to publicise the fight. They support community projects, help build hospitals, visit schools and organise concerts.

Zanon is an inspiration, both in Argentina and across the globe. Workers have strong links with the community and with other occupied factories. In a period where workers’ struggles in Britain and elsewhere are at a low ebb, it is a vital struggle. The recent experience across Latin America shows the creativity of the working class. It confirms the continued validity of our working class socialism.

But not all the experiments with workers’ control in Latin America have reached the heights of Zanon. Because of the wide range of experiences, clarity about the meaning of workers’ control is important.

Workers’ control means at least “dual power within a workplace” – a situation where the boss may still formally own the plant, but workers have an effective veto over key decisions, beyond wage bargaining to other conditions, working practices, hiring and firing. Workers’ control may go as far as establishing new social relations of production within a workplace, even where capitalist relations dominate for the economy as a whole.

Worker participation is something altogether different. It may mean having worker directors on the management board, it may involve formal channels of consultation, such as safety committees, staff meetings and working parties. But the power still lies effectively with the bosses.

Workers’ self-management is different once again. Self-management is about the running of workplaces under socialism, when workers also established their own state and are breaking down capitalist social relations between workplaces and replacing them with relations based on needs.

Workers’ control is substantial part of our history. In just about every high point in working class struggle – Spain 1936, France in 1968, Chile 1973, Portugal 1974-75, Iran 1978-79 and Poland 1980 workers have taken over their workplaces and localities and effectively posed the question of power.

In particular, the examples during the Russian revolution 1917 and in Britain in the 1970s indicate the positive aspects of workers’ control but also its dangers. The lessons of those experiences are worth reviewing, so that we are clear about the possibilities unfolding in Latin America.

Russian revolution 1917

After the general strike and the fall of the tsar in February 1917, workers went back to work with new ideas of how factories should be run. Hated managers were driven out, old rules discarded.

Workers organised factory committees to represent their interests against their bosses. The committees fought for an eight-hour day and pay rises, but also imposing workers’ control over hiring and firing, supplies and even guarding the factories and over production. By October 1917 two-thirds of large factories (with more than 200 workers) had these factory committees.

Trade unions were also formed. By October they had over two million members and were organised along industrial rather than craft lines. And between February and October 1917 2.5 million workers went on strike over higher wages.

The main organisations of workers were the soviets. In Petrograd, the soviet elected 1,200 deputies within its first week. The movement spread across the country. In March and April 1917 around 700 soviets were formed, with around 200,000 deputies. By October there were over 1,400 soviets, around a third based on peasants.

The basic principle of the soviets was that the delegates were directly elected by those they represented. The delegates could be recalled and replaced immediately. Representatives were not privileged, living a life above and apart from the workers, soldiers and peasants they were elected by.

These experiences were vital in preparing the Russian workers to take power, as they did on October 1917 led by the Bolshevik Party. One of the first decrees of the new workers’ government was to support workers’ control. Workers’ control was a prelude to workers’ power. Although these organs of control did not last — and were eventually extinguished by Stalinism — they remain an essential example of what workers’ control can lead to.

Britain in the seventies

During the late 1960s and 1970s in Britain, the trade union movement was advancing. Unions were powerful. Many large workplaces had shop stewards’ committees. It was a time of militant class struggles, strikes and factory occupations. Workers’ control was widely discussed – and worker participation advocated in some form even by the Tories and the CBI employers’ organisation.

In 1968 Ken Coates (later an MEP) and academic Tony Topham set up the Institute of Workers’ Control to study and promote workers’ control. The Labour government elected in 1974 set up a “Committee of Inquiry on Industrial Democracy” in 1976 that produced the Bullock Report. The committee included trade unionists Jack Jones (TGWU) and Clive Jenkins (ASTMS).

The Bullock Report recommended the trade union representatives get on boards of companies with more than 2,000 workers. There were 738 firms of that size in the UK at the time, including multinationals, employing 7 million workers. The committee recommended equal representation of workers and shareholders, with others holding the balance.

The TUC at the time promoted the German model. Worker participation, called “Mitbestimmung” was established in West Germany after the war. Works councils (Betriebsrat) were established from 1951/2 in the iron, coal and steel industries, but spread to other sectors. Separate supervisory boards (i.e. separate from the board of directors) had 50% of workers representation.

Workers’ control was widely discussed – but what was actually put into practice was workers participation. Unfortunately many militants didn’t heed the warning from German chancellor Willy Brandt, who said in 1974 “more participation is not a demand of enemies of the system, it is an alternative to class struggle”.

There was workers’ involvement in a whole number of sectors and industries. In 1974 according to the Labour Research Department, 4 out of 10 large companies had some sort of worker participation and 11% had worker-directors.

For example there were worker-directors in the private sector at Berry Wiggins, an oil services contractor, and at Bonser Engineering, which made fork lift trucks. There were worker-directors in the public sector: in the Post Office, British Steel, Mersey Docks and Harbour, Harland and Wolff and even BP. Cooperatives were set up at IPD, Meriden and the Scottish Daily News

When the car-maker British Leyland was nationalised, it sparked a debate over the running of state-owned industries. In 1976 the firm announced a 10-year expansion plan around the new Mini and also created a participation scheme. Many workers, including our comrade Jim Denham, at Leyland’s Longbridge factory, described the schemes at the time as a “charade”. Some workers, such as at Triumph Canley and at Rover Solihull, voted against participation.

These workers were absolutely right about “worker participation”. In 1978 Leyland announced 12,000 job cuts and began victimising stewards.

Another example came from Lucas aerospace, then the world’s largest producer of aircraft components and electrical equipment. Half its work was for the military.

Hundreds of workers took part in formulating an alternative “Corporate Plan”, published by the Combine Shop Stewards’ Committee. The plan included converting production to kidney machines, a hybrid internal combustion engine and electric motor, a road-rail vehicle and a remote control to help fire fighters.

The plan showed the tremendous creativity of the working class, in seeking to turn production towards useful work. The Lucas stewards also opposed worker-directors.

However the plan still envisaged working within the existing system (“a vast market available to Lucas”), establishing the “right to useful work” within a system built to make profit.

And Lucas bosses ignored the plan. In 1978 management announced 2,000 redundancies and victimised stewards.

In Britain, many worker participation schemes were put in place to dampen militancy and to co-opt section of the union bureaucracy and stewards. Participation was an alternative to class struggle – channelling workers’ drive towards power into tamer avenues.

With the election of Thatcher in 1979, these schemes were forgotten. Workers lost many of the elements of control that had been established in workplaces — although some elements, remained in law (for example safety reps’ rights).

These experiences in Russia in 1917 and in Britain in the 1970s are valuable to help us understand what could happen in Latin America in the coming period. The lessons are particularly pertinent in Venezuela.

Venezuela and
co-management

A year ago the Chávez government announced it was nationalising some bankrupt companies and introducing cogestión, “co-management” or “worker participation”.

The paper factory Venepal was heralded as the great example of co-management. When it went bankrupt, workers responded by occupying the factory and demanding its nationalisation. In January 2005, after legal action, the government paid market value for the firm and decreed it would be co-managed by workers and the state. It was renamed Invepal — “Endogenous Paper Industry of Venezuela”.

At the same time, workers have occupied other factories that have been abandoned or closed, to secure their jobs.

In October last year, the UNT union federation organised a Meeting of Workers for the Recovery of Enterprises. The 1st Latin American Gathering of Companies Recovered by the Workers was also held the following weekend in Caracas.

Chávez spoke at these conferences. He said he wanted all basic industry under state control. The government had assessed 700 closed enterprises, evaluating their suitability for expropriation, to preserve 20,000 jobs. He said, "we are not just recovering these factories, we are recovering our true sovereignty."

Probably the workplace closest to workers’ control is Alcasa, a state-owned aluminium processing plant employing 2,700 workers. Alcasa was already a state-owned company before Chávez came to power and had made losses for years.

Last year Chávez appointed Carlos Lanz, a former guerrilla activist as the president of the company. Lanz set up a factory council and departmental assemblies, although only around 20 workers turned up to the first meeting.

In April workers elected managers and two of its five corporate directors, as well as rank and file representatives. In December, an assembly of around 150 workers took place at the factory, organised by the executive board. The executive proposed new regulations for the voceros (spokespersons elected by the workers) and the functioning of workshops.

The spokespersons are elected by the workers in the different sections of the plant, they do not receive any additional money or privileges and can be re-called by a 70% majority. A poster on the wall in the plant states: “Functional delegation – in the sense that no-one is allowed to decide questions that have not been decided by the rank and file”. Workers also elect the managers (gerencias) and the workers’ co-management has even been extended to giving the workers powers to modify the budget.

Workers’ control at ALCASA is still embryonic. Posters on the walls state, “Co-management – towards workers’ control”.

Although trade unionists in the plant have called for the election of the whole board and the company president, this has not happened. Lanz was appointed by Chávez, not elected.

Managers interviewed by left-wing journalists make it pretty clear that the emphasis is on “development and diversity” i.e. getting production going, selling to countries other than the US and getting Venezuelan contracts e.g. for housing.

ALCASA is not profitable, and has been in this condition for more than 12 years. Although productivity has been raised by 11% since cogestión was introduced in February 2005, it is still making a financial loss.

A measure of the problems faced by workers was illustrated in January during elections for the main trade union in the plant, SINTRALCASA.

Several “lists” stood. The pro-Chavez “List 21” (FBT – Bolivarian Workers’ Force, the Chávez’s labour wing); “List 52” (“we are Alcasa”, a mix of Chávez supporters and “Causa R”); “List 1” (“Fuerza Sindical” – Trade Union Force, clearly linked to the Opposition, mainly AD); and MORAL 26, a coalition of various revolutionary groups that want to extend workers’ control.

MORAL 26 faced harsh attacks from activists of the “List 21”, denounced as “fifth columnists”. In a leaflet published by them, they attack MORAL 26 as “opportunists” and “the list of the company”.

According to reports, “List 21” has openly opposed the “cogestión” policies, from a reformist perspective. Although they were in the front line of the struggle against the December 2002 lock-out, this has not extended to backing workers now Chávez is not facing a national oppositional threat.

Conclusions

Workers’ control is an important slogan that has played a magnificent role in the traditions of the international labour movement. It remains part of the socialist arsenal. It’s also a demand to take workers beyond wage militancy to issues of power, i.e. depriving the boss of their rights to determine the conditions of employment.

And the experience of workers’ control is rich in lessons for today’s struggles and an excellent basis to explain the mass, democratic character of a socialist society.

But workers’ control is transitory, unstable: “dual power within a workplace”. Either it leads to nationalisation and workers’ self-management of industry, or it is inevitably driven back and workers lose control of the limited powers they have won.

Worker participation is often not a step towards workers’ control but at best taking a hand in our own exploitation. In the words of communist J.T. Murphy, “such methods force workers to undertake responsibility for the development of property which they do not own, and become part of an organisation which is pledged to prevent them from ever owning it”. (Compromise or Independence, 1918)

In Venezuela and much of Latin America, the factory expropriations are generally of small, private firms that have been closed for years or loss-making state firms. The workers involved are often a minority at the edge of the industrial working class. The recuperated factories still have to exist in a world dominated by the capitalist social relations and face enormous economic pressures.

In most cases, co-management means simply worker participation and consultation. In Venezuela co-management is mostly absent from strategic industries — notably oil.

It is a long way from workers’ control, never mind workers’ self-management — especially when the bourgeois state remains intact and workers have not formed their own mass workplace organisations.

The basic pre-requisite for workers’ control of industry is workers’ control of the trade union movement. It means building a militant, democratic and independent trade union movement – for example the UNT in Venezuela. It is means socialist organising in these workplaces and drawing on the experiences today and in the past to avoid the pitfalls of “participation”.

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