Industrial Democracy and Nationalization

Industrial Democracy and Nationalization A Study Prepared for the Fabian Society BY H. A. CLEGG Fellow of Nuffield College, Oxford BASIL BLACKWELL OXFORD 195 Printed in Great Britain for BASIL BLACKWELL MOTT, LIMITED by A. R. MOWBRAY Co. LIMITED in the City of Oxford INTRODUCTION IN July, 1950, the Fabian Society published a pamphlet, Labour in Nationalized Industry, which bore my name. It was an interim report of a Fabian group in which I acted as rapporteur. Its preface contained promises of further work and of a final report. The interim report, however, represented the limits of the groups agreement, and it soon became clear that no final group report was possible. Since there was such controversy, to stimulate general discussion seemed the only reasonable course. The group, therefore, decided, and the Executive Committee of the Fabian Society agreed, that it would be best for me to write an indivi dual essay. The members of the group have read various drafts of this essay, discussed it, and made a great many helpful comments. For this help I am deeply indebted to them, but no member of the group is responsible either for my errors or the opinions I have expressed. In fact, some of them strongly disagree with much that I have written. My thanks are also due to all those, including workers by hand and brain in nationalized industries and trade union officials, who have discussed with me the problems with which this essay is concerned. I should like finally to record my thanks to my father for help with proofs. H. A. CLEGG CONTENTS CHAP. PAGE INTRODUCTION ..... v I. THE MEANING OF INDUSTRIAL DEMOCRACY . i 1. The Development of the Idea of Indus trial Democracy i 2. Socialist Views ofDemocracy . . 12 3. The Problems of Industrial Democracy 19 I I. SOME GENERAL PROBLEMS OF NATIONALIZA TION . . . . . 37 1. The Forms of Nationalization . . 37 2. Problems of Accountability and Con trol ...... 40 3. Problems of Centralization . . 53 4. Conclusion ..... 58 III. THE LABOUR PROBLEMS OF NATIONALIZED INDUSTRY . . . . .61 1. Labour Productivity ... 64 2. Other Subjects of Consultation . . 75 3. Collective Bargaining and Wages . 81 4. The Problem of Responsibility . . 88 5. Problems of Trade Union Organiza tion ...... 92 viii CONTENTS CHAP. PAGE IV. INDUSTRIAL DEMOCRACY IN NATIONALIZED INDUSTRY . . . . .102 1. Decentralization . . . - 105 2. Decentralization and Collective Bargaining . . . . .114 3. Industrial Democracy at the Place of Work . . . . .120 4. The Trade Union in Industrial Demo cracy ...... 131 V. CONCLUSION . . . . . .142 INDUSTRIAL DEMOCRACY AND NATIONALIZATION CHAPTER I THE MEANING OF INDUSTRIAL DEMOCRACY i. THE DEVELOPMENT OF THE IDEA OF INDUSTRIAL DEMOCRACY The idea of industrial democracy arose out of the feeling that the worker had two causes for complaint against the capitalist system. That the worker suffers economic exploitation under capitalism, that he is paid, housed, fed, and clothed worse than he need be if society were differently organized, and that he may well suffer involuntary unemployment these criticisms are madn by every kind of socialist. The industrial democrat argued that in addition the worker was, for the duration of the working day and frequently beyond, subject to the arbitrary will of his master, and that the only remedy for this was to replace industrial despotism by industrial democracy. To live the worker needed to work for anemployer who would pay him a wage he was thus subjected to the orders of the employer and his underlings, and became a wage-slave, a condition which he could only escape when he himself shared in the control of industry through a democratic body composed of representatives of the workers concerned. 2 INDUSTRIAL DEMOCRACY AND NATIONALIZATION Something of this idea was in the mind of most of the early socialists, but the form which their industrial democracy was to take was rarely made clear...