What about the workers? Jeremy Corbyn and the private sector

Here's a disturbing fact. In May’s UK General Election, if only workers in the private sector had been allowed to vote, the Conservatives wouldn’t have just scraped a majority, they would have absolutely romped home. Labour got a paltry 26% of the vote (and the Tories 43%). How is this possible for a party that was created, at the start of the last century, as a party of private sector workers? And will the Blairite nemesis, Jeremy Corbyn, be able do anything about it?

To understand Labour’s steady diminution on this issue and the fact people manage to maintain a straight face when the Conservatives now present themselves as a ‘workers’ party’, you have to look at history and the Labour party’s gradual surrender to the forces of corporate Britain and the inexorable decline of organised labour.

A brief of history of Labour and work

When Labour was formed in 1900 it was as a political party representing the interests of trade unions - with a socialist wing attached. Given that Britain at the time was a resolutely industrial society, trade unions could justifiably claim to represent something approaching a majority of society. The socialist wing of the Labour Party became dominant with the adoption of the party’s Clause 4 constitution committing it to ‘common ownership’ in 1918. The fact that the Labour party was officially socialist did not mean that it was about to institute socialism. In the late 1920s and early ‘30s when it finally got it hands on power of some sort, Labour was spectacularly conservative, supporting austerity and welfare cuts. But there was nevertheless an assumption that the current autocratic organisation of private sector work (there wasn’t a public sector to speak of at the time) was living on borrowed time.

It was only after the Second World War, when Labour was elected with a massive majority, its so-called ‘High Noon’, that the party could make the kind of society it desired a reality and change the character of work in the private sector. Writing in 1947 the American political scientist, Robert Dahl, said there were two contradictory schools of economic thought about which way Labour should go: “one advocating central control of the economy in the hands of the state, and the other advocating workers’ control, where “workers will no longer be merely passive victims of the productive process, but direct participants in the control of productive enterprises”. The Labour government decisively choose the first option: industry was controlled by civil servants and appointed managers. Ownership may have changed but the new organisation merely mimicked the old, autocratic form of private sector organisation. In archive footage from the film, The Spirit of ’45, one miner laments that the ‘same tyrants’ remained in charge after nationalisation.

Though few realised it at the time, the roots of the Labour party’s alienation from private sector workers were laid here. But for a long time Labour’s model of nationalisation held sway. For 30 years the economy was resolutely mixed; even the travel agent Thomas Cook was in state hands. The interests of workers were thought to be sufficiently represented by strong trade unions, either in the now much larger public sector or the private sector.

This changed utterly with the arrival of Margaret Thatcher. The power of trade unions was destroyed and state industries privatised. In retrospect, talk of a property-owning democracy now feels like a transparent fraud, but Thatcher drove a tank through the mixed economy, post-war consensus - helped enormously by fact that the City of London, media magnates and other owners of private sector capital backed her the hilt.

The reaction of Labour was first to resist this new dispensation, then reluctantly accept some of it (Labour under Neil Kinnock was still in favour of some ‘social ownership), then to wholeheartedly embrace it all under Tony Blair. The Labour Left, of which Jeremy Corbyn was a part, merely defended the old approach from these multiple onslaughts.

New Labour and ‘the big end of town’

Tony Blair’s genius in winning elections was entirely the product of convincing the City of London and media moguls like Murdoch and Richard Desmond that New Labour wouldn’t interfere with their power. Originally interested in Will Hutton’s stakeholder democracy idea for the running of companies, Labour backed down the moment they discovered ‘the big end of town’ didn’t like it. The result was that New Labour’s view of the private sector – a part of the economy employing about two-thirds of society – was entirely determined by the desires and interests of those who owned those companies. Yes, the Labour government made it slightly easier to get trade union recognition, but, in a complete reversal of what the Labour party was originally about, the assumption became entrenched that the interests of the owners of companies and those that worked for them were identical. Both wanted ‘success’ and, in practice, what that entailed was left to the owners to define. To even whisper about nationalisation, or, heaven forbid, workers’ control, was to immediately place yourself beyond the pale.

When Ed Miliband lost May’s general election, the idea instantly sprang up amongst the Blairites that a primary reason was that he was anti-business. Yvette ‘Work Capability Assessment’ Cooper recalled going to a CBI conference after the election and being confronted by a businesswoman who told her, ‘You pushed me away. I felt like you did not want my vote. My staff felt the same.’” Note the location and the trademark assumption that that interests of owners of capital and employees were indistinguishable, although only the owner gets to articulate them. Added to this was the specious and, politically dumb, assumption that wealth creation was a gift generously bestowed by the owners of businesses and entrepreneurs.

But though the Labour Left may not have liked these associations or conclusions, it had very little to say about the private sector. This was, now that the trade unions in the private sector had been decimated, decisively ‘enemy territory’. The public sector, however, palpably needed defending, first from the import of private sector techniques under New Labour, and then from austerity. This turn inwards was disastrous. The envy that has underpinned hostility towards benefit claimants stems in part from a perception that private sector workers feel abandoned by an official Left that doesn’t seem remotely interested in them, or their problems. With the desertion of the Left, the private sector is perceived as an homogeneous mass, not the locus of conflicting interests, desires and outright coercion that it is.

All the new thinking about how private sector businesses should be organised has come from outside the Labour party. American economist, Richard Wolff, is trying to forge a social movement in favour of worker self-directed enterprises. In the UK, the authors of the influential book, The Spirit Level, Kate Pickett and Richard Wilkinson (who have backed Corbyn), advocate the development of workplace democracy, along the lines of the famous Mondragon group of cooperatives, throughout the economy.

The major stumbling block, sturdily erected by New Labour, is that it would be suicidal to focus on anything but the success of private sector companies, for the sake of workers as much as anybody. But the obsession with conflating success with the interests of owners, though deregulation and tax cuts, has led to its complete opposite – an endless financial crisis and insipid economic growth.

Beyond neo-syndicalism

However, before advocating that a Corbyn-led Labour party embraces a neo-syndicalism, it is necessary to remind ourselves that the nature of work has dramatically changed in the last 40 years. In the 1970s, it could be said that workers were still essential to the way production was carried out, and to ignore them was to invite disaster. Workers’ control was possible and, in some places, implicitly happened. Forty years later, the UK is largely a de-industrialised country and workers live with the ever-present threat of abandonment. If they are not necessary to produce profit, they won’t be used. Around 15% of UK workers are now self-employed anyway. Moreover, whereas manual labour was a source of pride and identity, today work is often characterised by just going through the motions to get a wage. According to a 2013 US Gallop survey, seven out of ten workers are ‘actively disengaged’ from their jobs. In Britain, 37 per cent of employees think their jobs are meaningless. Democracy at work won’t alter the fact that many people want to get away from their jobs, to many they are a necessary evil.

This is where an unconditional basic income could come in. A basic income could enable activities unrelated to work but vital for a flourishing society – such child-rearing, caring or artistic pursuits, but also facilitate small-scale economic activity that could breathe life into areas that the conventional corporate economy has left behind. The formation of thousands of cooperatives, social enterprises and other small businesses would become possible if they did not have to maximise profit. Both as an economic strategy and a way for the Labour Left to escape from its public sector ghetto, a basic income could be invaluable.