Kurzarbeit , "living-dead capitalism," and the future of the Left

30. 8. 2010 / Greg Evans

But if the influential, and recently deceased, French social philosopher Andre Gorz was correct, the reduction of the work week is not just a short-term, recession-related issue for the European socialist parties but the key to their survival, and indeed the survival of the Left in general. The reason? The increasing automation that we experience all around us -- on assembly lines, in banks, even when we call a company for information -- is symptomatic of a radical and profound change in the economic and political landscape, one which the Left, trapped in the inertia of its own mental categories, has completely failed to recognize.

The crux of Gorz's argument is that the chronically high levels of unemployment that Western Europe has been suffering from since the 1970s -- and which have since deepened and spread to the former East Bloc countries and now the United States -- is not indicative of a) a series of short-term economic problems, b) the failure to apply the proper neo-liberal policies to free up the market economy and thereby create jobs, or c) the failure to apply neo-Keynesian policies to stimulate and regulate the economy and thereby create jobs. Rather, it's indicative of the disintegration of a whole economic system -- i.e. capitalism in its classical sense -- and of the fact that this disintegration has broken the "continuity of two centuries of history, marked by the expansion of industrialism and the spread of commodity relations." The failure to solve the problem of high unemployment (even with extended schooling, early retirements, sabbaticals, and generous vacation benefits helping to reduce the number of workers on the payrolls) isn't then, according to Gorz, any more surprising than was the failure of the communist governments of the former East Bloc to solve their fundamental economic problems. Which is to say, just like them, we are trying to reform or revive an economic system that is, in essence, "dead."

Given the seeming dynamism that the post-1989 changeover has brought to the economies of the former East Bloc countries, Gorz's contention that we are now living under a "living-dead capitalism" might not seem, at first glance, particularly evident. But we must not, if we are to understand Gorz's argument, confuse an economy based on the sale of consumer goods and fueled by short term speculative capital (often invested in the service sector) -- the one we've been living under and calling capitalist -- with a true capitalist economy, which is to say, an economy fueled by long-term capital investment in industrial production.

According to Gorz, capitalism in its true sense started to disintegrate in the West in the aftermath of World War II thanks, in part, to its very success. It had, that is, "ceased to be propelled by a spontaneous dynamic of demand, reliant on what Marxists have always called `basic needs': those whose non-satisfaction is synonymous with destitution." Instead, with the most basic needs of its own populations having been met, it was faced with the need to create a "subject for the object", of a demand for the supply. "From the mid-1950s onwards," Gorz continues, "the centers of capitalism were faced with the necessity to produce consumers for their commodities, needs to match the most profitable products. Following its spontaneous, capitalist dynamic, production had ceased to correspond to preexisting needs: in as much as such needs persisted (notably in housing, sanitation and public health) their satisfaction was not profitable, or not sufficiently so, for capital. And, conversely, the most profitable products did not match unsatisfied needs: these needs had to be created ." [footnote 1]

Capitalism, then, was no longer operating according to its classical principle that a need leads to a demand which leads to a product being produced to meet that need. Instead, a technocratic superstructure developed that oversaw the advertising campaigns, urban planning, and other forms of social engineering necessary to create new needs, and the dynamic of need was no longer spontaneous. This resulted, during the 1960s, in late capitalism's golden age, in which rising wages and levels of consumption combined with full employment to create an era of prosperity that is now the ideal to which many party political programs in the West strive to return, and in the East strive to achieve.

But this very prosperity soon led to a further crisis, as rising wages and full employment caused a falling rate of profit -- especially once the extra needs that the technocracy had created were largely satisfied and supply began to outstrip demand. Employers first responded to this in the late 1960s by trying to increase the productivity of their existing work force with a speed up of work, but when the workers successfully resisted this neo-Taylorism with sabotage, wildcat strikes, and high absenteeism, "the big companies chose headlong flight: setting up subsidiaries in the Third World, launching new product lines, investing in productivity and capacity."[p. 11] And, with the coming of the digital revolution, the "investing in productivity and capacity" increasingly meant automation. This, according to Gorz, is when another pillar of capitalism -- the link between labor, the creation of value, and consumption -- began to collapse. Which is to say: the increasing automation of services and industry undermines "the basic premise of industrial capitalism itself. This premise -- on which the concept of `value' is based and which gives rise to the `law of value' that, for Marx, was the cornerstone of capitalist reasoning -- is that the wage pays for labour to meet the needs which labor generates in those who supply it." [p. 44]

Hence, "living-dead" capitalism. For, if the number of workers who create value is continually decreasing and the majority of people therefore work in the service sector, where they are, in essence, allotted a share of the earnings from the increasingly automated factories; and if a technocratic super-structure attends not only to the distribution of these earnings, but the creation of new needs, so that the factories can continue to produce consumer goods -- can we still call this capitalism? Except, that is, in the broadest sense that the corporations are privately owned?

For the Left this living-dead capitalism has profound consequences in that the increasing automation is making impossible the traditional socialist dream of full employment (rigidly defined as five 8-hour work days per week for all who want or need it), and therefore the possibility that they can successfully institute programs, upon being elected to office, to make this dream into any kind of reality. The logic of this traditional approach was well-stated by Stanislav Grospič, member of parliament for the Communist Party (KSČM) when, in a recent interview in Hálo noviny, he stated that "it is necessary to back long-term state investments, especially into the transportation infrastructure, if need be also into the energy infrastructure, because this will create jobs. It is an absolute mistake that our current government contemplates cutbacks or the elimination of such funding. At the same time it is necessary to back the sciences, research and development, and education. These are driving forces which can maintain and potentially even increase employment. These measures will not only have a short-term effect, but also a long-term one, because they will create new jobs."

But Gorz would counter that this approach, which was a logical and effective response to the Great Depression, will not be similarly effective in solving the problems of unemployment, underemployment, and marginal employment in our current economic crisis.

To see why we need go no further than the German province of Saxony. In 2004, after 14.1 billion euros of investment, including massive government subsidies, the region's 300 now fully modernized chemical makers were producing about the same volume of chemicals as the region had produced in 1989. The problem, from the traditional Left's point of view, was that they were doing it with a tenth of the employees. And this trend is not new, nor by any means confined to the modernization of former communist industries, as is shown by a study quoted by Gorz (F. Vester, Ballungsgebiete in der Krise ) which showed that DM 1,000 million invested in industrial plants would have generated two million jobs in 1955-60 and 400,000 jobs in 1960-65. From 1965-70 the same sum would have destroyed 100,000 jobs and from 1970-75 would have destroyed 500,000 jobs.[p. 30] Or, as Allen Sinai, chief global economist at the research firm Decision Economics, recently told the New York Times regarding the rising tide of unemployment in the United States: "American business is about maximizing shareholder value. You basically don't want workers. You hire less, and you try to find capital equipment to replace them."

Taking this process of automation to its logical and ultimate conclusion, as Wassily Leontief, the Nobel Prize winner for economics in 1973, did in the following citation, helps illustrate the conundrum that the Left faces, especially regarding its need for a more militant and imaginative incomes policy :

Though we are still far from the scenario of full automation described by Leontief, automation has already become prevalent enough so that we can now see the first glimmerings of its realization, especially in the chronic problem of unemployment. And, by not addressing this issue directly, the Left is helping to ensure that we will, in Gorz's words, "Exit Right" in one of two forms. The first form might be called the Thatcherite, or neo-liberal, form, in which, as automation abolishes workers -- and thereby abolishes buyers -- we will see the law of the market work effectively "and the relative prices of automation's products fall sharply -- towards a value equal to the maintenance, reproduction and operating costs of automated plant and equipment. The wage bill becomes negligible, the workforce tiny. Permanently employed workers become a narrow social stratum, alongside vast numbers of unemployed." [p. 31] Though we have, especially in the USA, seen a tendency toward this model in cities like Detroit and Youngstown, Ohio, where large sections of the population live in deep poverty in the shadow of decrepit industrial and manufacturing plants -- Gorz believed that the "monopolies and cartels [would] prevent massive price-cutting, and the products of automation (like the sale of `non-material goods') [would] bring in huge profits. These profits, however, prove impossible to reinvest (that is, to accumulate as capital) because production requires less and less capital and distributes very little in wages, and thus does not generate expanding effective demand. So a large proportion of profits will have to be redistributed to enable commodities to be purchased, and to prevent the economy from collapsing." [footnote 2] Thus profits become a revenue stream and consumption a duty to keep the economy going, a reality reflected in George W. Bush's statement in the wake of 9/11 that the most important thing Americans could do was to keep going to the mall and buying consumer goods.

The Right, backed by the corporations, will be quite happy to have us continue to live under the incomes policy that they are, de facto, determining, and which is entirely to their benefit. The Left's current approach, in which they continue to deny the need for a radical restructuring of the current incomes policy, means that they will essentially become an accomplice to the "Exit Right" scenario described above. Specifically, their energies and talents will be consumed in fighting neo-liberal elements to ensure that the working-class will be allowed to endure its increasing levels of unemployment with some dignity (i.e., that they be granted endless re-training programs leading nowhere, extended unemployment benefits, continued health insurance, etc.).

In this context the ČSSD's kurzarbeit is nothing more than a tentative acknowledgement that there might be some other solution to the unemployment problem besides the current Left program of striving for the (no longer realizable) goal of everybody working a forty-hour work week; however, besides the fact that it is very much a temporary measure for the economic crisis, one of the key points of the program, which states that "the employees shall receive training in their days off and thereby get 100% wages while at the same time improving their qualifications, and with that their value in the marketplace," shows that the ČSSD remains trapped in the logic of living-dead capitalism.

The same could be said for the Green Party (SZ) who, as a part of their program "The Green Path from the Crisis," propose "twenty successful and helpful measures -- insulation of homes, electrical supply, recycling of waste materials, public transit, and schooling -- which would create 70,000 new jobs..." to which, however, they quickly add, "in the Czech Republic there could soon be almost half a million people without work thanks to the economic crisis," so clearly the problem of unemployment is in no way solved by these green jobs. What then follows is the standard litany of proposals, more investment, better training, more education, decent unemployment benefits, respect for the unemployed, and some job-place flexibility to allow parents to better care for their children. But, in spite of the fact that "the Green Party mainly wants to work on the reduction of long-term unemployment," there isn't a word from the party that pursues "policies with a view to the next fifty years, not just the next five months and from election to election," about a reduction in the workweek, not even a mention of kurzarbeit. So with the Green Party it would seem that living dead capitalism -- though with an ecological tinge -- would be solidly in place for at least another half century.

Nor does the Communist Party (KSČM) succeed in going very far beyond this traditional left litany of solutions. While it's true that, in another interview, Grospič indicates that the KSČM at some point proposed a permanent 36 hour work week at full time pay, this is not mentioned in the KSČM's on-line and campaign literature. There, everything points to that happy land where everyone can work full-time (that is, five full days a week even if, perhaps, they are proposing that it be a seven instead of an eight hour day). Gorz, one imagines, would probably have criticized the KSČM for not fully absorbing the implications of Marx's Grundrisse , especially in regards to the nature and implications of technological change. Especially since there is an interesting article about just this topic on their website, in which František Neužil writes that "The process of liberating living labor from the control of dead labor, when automatization of production has, for example, the form of a flexibly roboticized industrial system, has for Marx not only a productive dimension, but a social-economic one as well... In the Grundrisse Marx sketched a perspective of the evolution of civilization, in which free time becomes a measure of social wealth and the growth of free time can be, from the point of view of the direct production process, considered as the production of fixed capital, in which this fixed capital is man himself."

Similar to the Social Democrats (ČSSD), the Czech Trades Union Congress (ČMKOS) backs kurzarbeit , but then neglects to mention either it, or the general idea of a shorter workweek, in their official program ("Program of ČMKOS for the period 2010 -- 2014"). Instead they write, for example, that "ČMKOS will push for policies and measures which will back economic growth by way of innovation and an increase in the competitive efficiency of the economy, which will aim at a lowering of unemployment, more jobs and a growth in the real income of the populace," or "it will demand that the state will increase and expand requalification programs so that it will become the engine for an active policy of employment and improve the employability of job applicants and the skill and knowledge of employees."

So none of the parties offer what Gorz would consider the necessarily transformative vision that offers an "Exit Left" solution. What would such a solution entail? Broadly speaking, Gorz argues that the Left must rediscover its roots in the early worker's movement -- and many of the ideas espoused by that movement --, as "we are now reaching precisely the point that was foreseen by the first prophets of post-capitalism [e.g., Ricardo and his followers, and later Marx] when, beyond bourgeois society and nascent industrial capitalism, they predicted a different social order -- one where the efficacy of technology would abolish work, the logic of capital and commodity relations, to reveal `disposable time' as the measure of `true wealth.'" [pp. vi-vii]

Gorz, writing in 1983, points to the fact that the citizens of the 1980s could, thanks to the increased automation of production, all essentially work part-time if they lived at the consumption levels of the 1960s. And, by part-time, we are talking about under twenty hours a week. Or, to take a more recent and even more dramatic example, since the Saxony chemical plants mentioned above now produce the same amount as they did in 1989 but with only a tenth of the workers, the same could therefore be done with the same number of workers as were there in 1989 working only a tenth as much. Of course here the implications regarding the "liberation from work" become quite radical. And even if we grant that these two examples are, by themselves, rather reductionist, they are nonetheless illustrative of the transformative potential that automation offers.

Which is to say that we could all work part-time and live quite comfortably. And to anyone who fashions themselves a Leftist (ČSSD, KSČM), trade unionist (ČMKOS), or visionary of a better society (Green Party), and whose reaction to such a scenario is to dismiss it for technocratic reasons or because they are appalled at the thought of what the slovenly common man or woman would do with all that extra time, then they should consider the possibility that they are a contradictio in adjecto (that is, in this context, a progressive without belief in progress, or at least in any more progress). There are, of course, problems and complications to such a libratory scenario, and how Gorz (and others) address these would have to be the topic of another article; but if the only alternative to pushing for such a scenario is for the Left to "wait, forlornly, for the future to give us back the past, for the economic `revival' or `recovery' that will provide full employment, for capitalism to rise from its death-bed, for automation to create more jobs than it eliminates," it might behoove the Left to rediscover its visionary roots in the early worker's movement.

Footnotes:

[1] Gorz, André, Les Chemins du Paradis (Galilée, 1983), the citations are from the English translation: Paths to Paradise: On the Liberation From Work (Pluto Press, 1985)

[2] In part, I believe, this would happen through massive, speculative investment in the service sector, in which investors try to find new market opportunities. As an example, this is apparently what happened in Tucson, Arizona, where there are 23 tanning salons even though the sun shines more there in December than it does in the Czech Republic in July. Therefore we can say, in the language of "postindustrial" capitalism, that when somebody found and took advantage of this market opening and started offering this absurd and unnecessary service, they "created" wealth and jobs.

New York Times : Millions of unemployed face years without jobs

Grospič: Chceme důsledně hájit zájmy pracujících

Christian Science Monitor : Automation streamlines services and high-tech, but at what cost?

Automation World: Outsourcing Not the Culprit in Manufacturing Job Loss

New York Times: Eastern German Chemical Industry Stages a Comeback

Grospič: Dohoda tripartity hospodářskou krizi nevyřeší

Neužil: Marxistické pojetí dialektiky společné a všeobecné práce a soudobý kapitalismus