With Responses From
May 22, 2017
7 Min read time
Corporate social responsibility is a failed strategy.
“In order to win workers’ rights,” Pope, Bruno, and Kellman argue, “organized labor should act like a rights movement. History tells us that rights movements—from abolition to women’s suffrage to civil rights—succeed when they claim a few key rights, exercise them at every opportunity, and place them front and center in every phase of movement activity.”
To me, two words are holding them back: “acting like.” There can be no “acting like” for organized labor, for in today’s world of global finance capitalism, labor is the new frontier in the historic struggle for rights—which is in fact a phase in the struggle for emancipation. For anyone concerned with nurturing the democratic project, the state of disenfranchisement faced by workers the minute they enter the workplace is cause for alarm. This disenfranchisement is alarming because of the dramatic consequences it has for the health of workers to the state and the credibility of our democratic politics. The distress it causes can engender disastrous responses, as the election of Donald Trump has shown. Such responses are a menace to our democracies. Yet, the institution from which democracy is most lacking today—the firm—has managed to stay off our political radar. We should all—rights and labor activists, unions, progressive thinkers, citizens of the world—be adopting the same refrain: “It’s the corporation, stupid!”
For anyone concerned with nurturing the democratic project, the disenfranchisement of workers is cause for alarm.
The term emancipate comes from the Latin emancipare: “to free a slave,” derived from e-manu-capare: to cease to hold by the hand. In the Roman Forum, slaveowners signaled their intent to purchase a slave by taking him by the hand. The word thus implies release from slavery, guardianship, domination, alienation—from constraint in general, be it physical, moral, intellectual, or otherwise. In concrete terms, it is used to describe a situation in which a given category of the population is granted the same rights that others have already secured. Today, in the wake of struggles to emancipate colonies, enslaved peoples, ethnic groups, and women, the time has come to emancipate workers. Why? Because workers are no less equal than others, i.e., the capital investors. They indeed invest at least as much in firms as capital investors do. Capital investors, organizing their capital through the corporation, have the right to govern firms. Workers, on the other hand, although their labor has been organized to varying degrees over the centuries, have no fitting institutional mechanism by which they might contribute to the government of their firms. It is high time to recognize workers’ right to organize in this complete sense—that is, through an institutional mechanism that gives them the same rights as capital investors to participate in governing the firm. While corporation and firm are two terms often conflated, corporations are actually only the organizing vehicle for capital investors—that is, only a part of the broader entity of the firm. Firms, strangely enough, have no real existence yet in law. They require proper institutionalization, with appropriate, equally shared sets of rights between capital and labor.
Studying the history of political revolutions since Roman antiquity, when the Tribunes of the plebs held veto rights over all decisions made by the Patricians, we learn that the prosperity of Western societies was made possible through moments of emancipation, in which a dominated—and often more numerous—group in a given society acceded to the same rights as the minority, and began to participate in its government. In each of these moments, a single institutional innovation was put in place, that of bicameral politics, engineered to produce productive compromise between two divergent sets of interests.
Corporate social responsibility is a failed strategy; asking capital to respect workers’ rights to organize is futile.
Today’s employees feel a constant strain between their own aspiration to more justice in the workplace and the domestic regime imposed on them by the power structure of the corporate firm. Although its name connotes a “private home”—from oikos-nomos in Greek: the rules of the household—the economy (particularly the service economy) has become more and more part of the public space. Employees work in constant contact with or under the constant gaze of customers—the public, in other words. This gaze transforms work into a political experience grounded in the expectation of democratic justice that underpins the culture of our civic life. Outside the workplace, workers are enjoined to behave as responsible citizens, as voters capable of taking a stance on major “political” questions (for example, who should govern the country). Arriving at their jobs—the very place where they are best qualified to assess situations and make decisions, they become not citizens but instruments, a workforce, subject to the unilateral decisions of a firm government structured entirely around capital. Capitalism and the democratic ideal coexist in burning contradiction, and employees today are experiencing its heat firsthand. For the sake of both efficiency and justice, it is the moment to recognize that firms are political entities in need of democratization. Placing firms in the context of the political history of Western societies makes it clear that we should set our sights at democratizing their government. To unlock the democratization process, history teaches us the importance of what I call “bicameral moments” as being key to enabling moments of institutional innovation.
We find ourselves in the throes of economic and democratic crisis: inequalities keep on rising, some firms are closing or some low-skilled jobs are lost because of automation; outsourcing, subcontracting, and offshoring are everyday realities; workers and citizens are losing both their motivation and their trust. These problems will not be solved from the outside. Firms require governments worthy of that name, legitimate, reasonable, and intelligent. Our challenge today is to help them—and the societies in which they function—to evolve toward this goal, to create a stable and vibrant economic fabric while remaining open to the world. A new political compromise struck within an appropriate legal framework would foster everyone’s capacity to innovate—labor investors and capital investors alike.
The people investing their labor in our economy’s firms want to be fully involved in the creation of the norms governing their workplaces. The most innovative businesses have already figured this out: business school courses in participatory management and methods for “liberating the firm” abound. Capitalism, as always, has seen and recycled the political critique of the restraints on worker productivity—its ability to do so should not be underestimated. Once again, as Pope, Bruno, and Kellman write, “The problem is structural.” In some European countries, such as Germany, France, and Belgium, labor representatives are present but underrepresented in the government of firms; in the UK or the United States, they are almost entirely absent. How can our economy advance if the firms that drive it are governed in such a lopsided, unicameral, and outmoded fashion? To overcome this weakness, the institutional model of bicameral politics should be expanded to include firms. Today it hardly needs to be explained that England could not be governed by the House of Lords alone—why should the contemporary capitalist firm be governed by the Board alone? “Economic bicameralism” would change that. Two houses, a “Capital Investors’ House of Representatives”—the current Board—and a “Labor Investors’ House of Representatives” would work together to govern the firm in the interests of all its stakeholders. They would do so as an elected, representative government, in the form of the firm’s top management, which, to set the rules governing the existence of the firm, would have to receive a majority vote in both houses.
Corporate social responsibility is a failed strategy; asking capital to respect workers’ rights to organize is futile. This is clear in the United States, where the consequences have been dire. Capital investors hold the real power; organized labor has little more than the crumbs. But the long history of human emancipation shows us that there is another way forward. Institutions matter. Capital has the institution of the Board; labor does not —yet. To truly organize labor would mean obtaining for it the same sets of rights that capital holds through the corporation. Workers need actual equal rights—which means equivalent institutional channels within a bicameral firm. The capitalist corporate firm as we know it should become as obsolete and preposterous as patricians ruling Rome without representatives of the plebs (a bicameral moment that took place in 494 BCE). If they really want to further workers’ interests and dignity, unions must fully embrace a rights agenda. And, as Pope, Bruno, and Kellman so rightly point out, this requires relinquishing a system of exclusive representation, which does not fit with a renewed, fuller understanding of democratic citizenship broad enough to embrace the economic as well as what is currently institutionally recognized as the political. The future of organized labor depends on it—as does the future of our democracies. Firms are the new frontier in the democratic experiment, where it is time for citizens—whether they are partners, collaborators, employees, or workers—to truly become equals.