Undermining Capitalism: State Ownership and the Dialectic of Control in the British Coal Industry
336
Undermining Capitalism: State Ownership and the Dialectic of Control in the British Coal Industry
336Paperback
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Originally published in 1984.
The Princeton Legacy Library uses the latest print-on-demand technology to again make available previously out-of-print books from the distinguished backlist of Princeton University Press. These editions preserve the original texts of these important books while presenting them in durable paperback and hardcover editions. The goal of the Princeton Legacy Library is to vastly increase access to the rich scholarly heritage found in the thousands of books published by Princeton University Press since its founding in 1905.
Product Details
| ISBN-13: | 9780691612980 |
|---|---|
| Publisher: | Princeton University Press |
| Publication date: | 07/14/2014 |
| Series: | Princeton Legacy Library , #729 |
| Pages: | 336 |
| Product dimensions: | 6.00(w) x 9.00(h) x (d) |
Read an Excerpt
Undermining Capitalism
State Ownership and the Dialectic of Control in the British Coal Industry
By Joel Krieger
PRINCETON UNIVERSITY PRESS
Copyright © 1983 Princeton University PressAll rights reserved.
ISBN: 978-0-691-07662-1
CHAPTER 1
STATE OWNERSHIP, THE NCB, AND CONTRADICTIONS OF BUREUCRATIC MANAGEMENT
When the party label Social Democrat still referred mainly to German Marxists, and the Labour Party was occupied with working through the special meaning and purpose of socialism for Britain, the issue of nationalization was at the core of party debate. In 1952, Roy Jenkins, now a leader of Britain's own Social Democratic Party, but then representing a strong mainstream position within the Labour Party, explained what state ownership in Britain was all about.
A substantial extension of public ownership is ... an essential prerequisite of greater equality of earned incomes and an inevitable concomitant of greater equality in the ownership of property. ... The measures of nationalisation which we saw between 1945 and 1950 were largely planning measures. They were put forward as proposals which were necessary to ensure adequate governmental control over the whole economy, and the industries which were chosen were mostly those through which this function could best be exercised. As a result, they were necessarily measures which involved whole industries and which imposed a centralised structure upon them. All the main line railway companies had to be taken and it would not have done to have substituted catering for coal.
In their efforts, Jenkins and the other "revisionists" who sought to enshrine "equality" rather than ownership and control of "the means of production and distribution" as the central orthodoxy of British socialism, were programmatically successful. Whatever the battles about the meaning of socialism and the related leadership struggles in the Labour Party during the Bevanite period, a moderate, highly compensatory, industry-dominated, capitalist rationalizing model of nationalization has held sway in postwar Britain. But the revisionists, and the "fundamentalists" as well, badly misjudged the consequences and enduring meaning of the practice of state ownership. Accordingly, they missed something significant about the evolutionary prospects of contemporary capitalism.
Cast within a matrix of capitalist forces, the publicly owned enterprises were not to afford governmental control of the "whole economy." Moreover, equality could not be administered through the wages (incomes) policies of the nationalized industries, despite, as we shall see, the most sophisticated and sincere management efforts. Worst of all, no centralized structure could be imposed successfully on far-flung, regionally diverse industries with long, vital, and divided histories and workers who held these histories dear. Remarkably, both the moderate center and the Marxist outreaches of the Labour Party — and the broader socialist movement beyond — failed to appreciate the self-limiting character of capitalist nationalization. Nor did they anticipate its contradictory consequences and, despite current signs that old debates about the meaning of British socialism never die, the disputes of the '50s do not wear well on new reading.
While stressing the revisionist dogma of equality, Jenkins tried also to absorb the fundamentalist concern for planning, ownership, and control. Both camps were to be disappointed. State ownership has not generated equality of any recognizable kind and it does not represent public control from the commanding heights for transformative purposes. Nationalization does not, as a classical strain of social democracy suggests, mean that leading industries can be wrested progressively from the control of capitalists and the state turned piecemeal to the interests of socialism. For one thing, capitalists have been quite content to offload moribund industries onto the state under extremely favorable terms, and for another, nationalized industries have operated by principles (for example, "buy dear and sell cheap") and strategies (notably in hard-nosed industrial relations bargaining) which give the advantage to capitalist elites and reproduce the norms of class society. Nevertheless, despite the implementation of state ownership on exceedingly capitalist terms, nationalization undermines capitalism in unforeseen ways, without ever offering an alternative example of industrial organization and economic coordination. As it turns out, I agree with Jenkins only that when considering the problems of state ownership in Britain, "it would not have done to have substituted catering for coal."
In what follows, I will use the history of the nationalized British coal industry to illustrate what to me seems a fundamental truth about contemporary capitalism, namely, that even the most subtle and far-reaching efforts at rationalizing capitalism are likely to come undone. In this book, I look at the premier effort of the National Coal Board (NCB) to do exactly what a sophisticated management operating a troubled industry as part of a capitalist-rationalizing state is supposed to do. The management should rationalize production and, as Jenkins tells us, use public ownership to promote the equalization of incomes, all through the imposition of a centralized structure.
After nearly two decades of sporadic negotiation, the NCB and the National Union of Mineworkers (NUM) agreed upon the implementation of a national uniform wage for faceworkers, the 1966 National Power Loading Agreement (NPLA). Both sides believed that the agreement would inaugurate a period of industrial harmony and provide the basis for improved productivity which was required to stabilize the industry. I argue that the NPLA failed, despite painstaking planning and artful management execution, because it unleashed a surprising battle for control of production and ultimately reordered the inner life of work relations and industrial conflict down the pit. I argue that a new "dialectic of control" at the coal face, generated by the NPLA, triggered regionally distinctive responses from miners, who reacted to the imposition of national uniformity with a high degree of flexibility and self-conscious strategy. They responded in ways which were encouraged by disparate patterns of work relations and conditioned by the miners' concrete work situations — the history of the pit, the geology, the technology, and the organization of labor under which they worked. Specifically, I looked at Durham, with its history of thin seams and low productivity, its union moderation offset by Geordie determination to "fight the gaffers" with unusual workers' control strategies, and at Nottingham, the high-producing area of the post-1926 breakaway union, with its traditions of competitive, hierarchical, and disciplined productivity.
It turns out that the cornerstone of NCB strategy, which was to stabilize the industry's prospects by imposing uniformity and rationalizing wage structures, proved unsuccessful in both regions, as the efforts proved incompatible in different ways with the values and practices of both Durham and Nottingham miners. While the specific problems faced by the NCB in implementing the NPLA — ambiguous productivity results and the first two national strikes since 1926 — are no doubt linked to British coal, per se, the consequences of the failure of the NPLA are likely to be of more general significance.
These observations concerning the contrast between British socialist theories about public ownership and the practical consequences of such ownership are preliminary, and I shall return for another look at these issues much later. For now, I merely want to introduce the possibility that the Coal Board's problems are not unlike those that may attend the management of other state-owned enterprises. Even more central here, they signal fundamental contradictions which in general diminish the capacities of centralized state bureaucracies to administer policy effectively. Accordingly, the fate of British coal may tell us something important about the contradictory and self-limiting practices of the contemporary state, and the ways in which capitalist rationalization is endemically undermined.
Nationalization and Wages Policy
Born in the era of competitive capitalist ownership, regional divisions persist within the modem nationalized industry to scuttle the best plans of the NCB's management team, which is attempting (with uncertain results) to plan, centralize, and coordinate the business of mining coal in Britain. Thus, decentralizing tendencies and potential sources of localized conflict have been a fundamental genetic fact of the industry. Recognizing this, from the start the new management sought to impose a centralized structure on a fragmented industry.
Along with the formal transfer of ownership on 1 January 1947 of 1,400 colleries, 225,000 acres of farmland, 85 brick-works, 55 coke-oven and by-products plants, 140,000 housing units, and assorted shops, hotels, milk rounds, and swimming pools — the National Coal Board also inherited a confusing complex of local wage agreements from the capitalist owners. For work directly at the coal face — hewing, putting, pulling, caunchwork — men were typically paid by results (piece rates). But there was no consistency among the pay levels. The same job, even under comparable geological and technological conditions, more likely than not received a different compensation on a face in South Wales and a face in Scotland. Indeed, two men performing the same task on the same coal face in a given colliery might also receive a different level of pay, since "anomalous conditions" — for example, the presence of water or a faulting condition — led to a custom of bargaining on the spot over the specific piece-rate level. The "spot bargain" in turn would not only be determined by the working conditions (such that a higher rate of compensation per "piece" might offset the lower production potential of work under poor conditions), but also would vary according to the balance of labor-management power in the particular colliery. Thus the variety of pay levels and wage agreements was endless, and the situation constantly in flux. Adding to the irregularities of the wages system, there was no clear job ladder with consistent definitions of task or with uniform salary scales. This note of uncertainty and irrationality frustrated a vigorous management team bent on applying every potential advantage of centralized structure toward the end of harmonizing industrial relations and increasing productivity.
Failing in a series of attempts to rationalize a piece-rate wage formula, from the late 1950s onward the NCB and the miners' representatives, the National Union of Mineworkers, focused their attention on the negotiation of a uniform time-based (daywage) agreement. Finally, after years of NCB irresolution followed by a curious reversal in NUM policy, the National Power Loading Agreement (NPLA) was signed in June 1966. Stipulating a five-year transition to a uniform national daywage for face workers on mechanized (i.e., power loaded) coal faces, the agreement transformed the inner workings of the industry.
At the beginning the NPLA was considered a great victory for the NUM and the mineworkers, who resented the age-old practices of victimization, relaxed safety standards, and competitive productivity which accompanied a piece-rate wage form. But the path-breaking agreement was, in the end, pressed by the NCB on a divided union. A time-based wage suited the management needs of an industry which was rapidly mechanizing its operations, thereby replacing worker initiative with machine running time as the ostensible determinant of productivity. Moreover, in return for a uniform wage, which could be affected neither by machine breakdown nor poor geological conditions, nor by variable laboring effort, the NCB won the right to establish full management control over the direction of the labor process. The NPLA was a monument of the NCB's efforts to rationalize the industry by applying the advantages of centralized administration. The NCB viewed the daywage agreement as the critical instrument with which to force modernity on an industry encrusted with fragmenting distinctions — regions with diverse labor histories and varied patterns of geological and technological resources — and decentralized habits.
Management Strategies and the Pitfalls of Rationality
By the time I began my research in the summer of 1974, attitudes about the NPLA had changed. Coal Board officials, and more than a few of their NUM counterparts, were calling the daywage agreement a disaster. The NPLA was not only responsible, at least indirectly, for the national strikes of 1972 and 1974, but it contributed to declining productivity. It was presented as an article of faith throughout the industry that new incentive agreements based on productivity (subsequently introduced in the winter of 1978) offered the only hope for generating renewed vitality within the industry. From both the NUM and the NCB I invariably received the same persistent advice. If I wanted to study what was really going on in the industry, I ought to look at the effects of wage structures and try to understand the importance of the transition from payment by results to daywage in the 1966-1971 period.
Although skeptical at first that a single policy innovation could have such far-reaching consequences, the unanimous claims of miners and managers that the NPLA had transformed work relations, industrial relations, and patterns of productivity were persuasive. These claims were enough to draw me into much deeper research about the management strategies and processes of deliberation which led to the NPLA and about the subsequent effects of this agreement; the results of my investigation comprise this study.
As I began to consider the behavior of the Board in negotiating the sweeping rationalization of wage structures, I discovered a critical unresolved issue which made me question the wisdom of miners and managers and reflect further on the implications of NCB management strategy. From the time I began my research to this day, the NCB has stuck to a simple story about the consequences of the national daywage agreement. The elimination of material incentives for high productivity led, according to the official interpretation, to reduced worker initiative and hence to disappointing trends in productivity. The claim, while it obviously had some basis, aroused my suspicion. Every regional employee of the NCB industrial relations staff in Durham could detail for me the effects on productivity of time-based wages as compared to a straight payment-by-results scheme or a complex time-based wage plus productivity bonus scheme. Then why couldn't the Hobart House wage structure brain trust anticipate the obvious results a decade earlier? Why had the NCB introduced the "disastrous" wage structure in the first place?
If the NCB were simply staffed by incompetents or if they had been forced to the decision by the power of the NUM, then the administrative processes would concern only those with a special interest in the industry. But if, on the contrary, the NCB had employed sophisticated planning strategies and if, as I was led to believe, they had artfully managed and directed the lengthy negotiations — then broader issues were at stake. Were there structural reasons why results which were unforeseen by management would scuttle the most carefully planned strategy of a centralized bureaucracy? Were there, for example, tendencies toward deconsolidation which unavoidably limited the centralizing efforts of national, nationalized management? Was there something beyond the specifics of NCB policy and the British coal industry which made the best laid plans of rationalization go awry and appear, by their consequences, irrational? Initial research into the history of negotiations and NCB management strategy confirmed my growing suspicions that the answer to each of these questions might be affirmative. If so, more was at stake than the failure of NCB policy. By looking at the causes behind the destruction of the wages strategy which lay outside the NCB proper, I could explore the transmission of policy initiatives from centralized bureaucracies to the groups directly affected by their administrative practices. By this focus — on the connection between state policy formulation and the response of those who are the object of particular bureaucratic initiatives — I could hope to illuminate problems of centralized bureaucratic management under capitalism which have fallen in the cracks among state theory, studies of bureaucracy and organization, and accounts of the behavior of diverse groups, interests, and classes that both influence and respond to the policies inaugurated by state agencies. I was convinced that the implementation of the NPLA in the British coal industry posed serious questions about the problems and processes of state bureaucratic management which warranted further investigation.
(Continues...)
Excerpted from Undermining Capitalism by Joel Krieger. Copyright © 1983 Princeton University Press. Excerpted by permission of PRINCETON UNIVERSITY PRESS.
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Table of Contents
- FrontMatter, pg. i
- CONTENTS, pg. vii
- LIST OF TABLES, pg. ix
- ACKNOWLEDGMENTS, pg. xi
- CHAPTER ONE. STATE OWNERSHIP, THE NCB, AND CONTRADICTIONS OF BUREAUCRATIC MANAGEMENT, pg. 1
- CHAPTER TWO. THE POLITICS OF PRODUCTIVITY, pg. 37
- CHAPTER THREE. TOWARD AN EXPLANATION, pg. 62
- CHAPTER FOUR. DURHAM COLLIERY STUDIES, pg. 102
- CHAPTER FIVE. NOTTINGHAM COLLIERY STUDIES, pg. 175
- CHAPTER SIX. CONCLUSION, pg. 261
- NOTES, pg. 279
- GLOSSARY, pg. 299
- BIBLIOGRAPHY, pg. 301
- INDEX, pg. 315