09/02/2022
A brief history of socialism in labor
In regards to labor issues, often the subject of socialism seems to come up, or--the socialist viewpoint. The AFL-CIO is a political organization that most U.S. labor unions belong to. It is a true fact that this political organization regularly supports and contributes to socialist minded left-wing politicians and causes. It is a matter of fundamental ideology.
The capitalist thinks that by addressing the needs of the businessman, the needs of the populace are addressed, such as Reagan’s “trickle down” economics. The socialist sees the economy as simply addressing the needs of all the people, that everyone in that economy is “entitled” to a fair share. You hear that kind of rhetoric coming from the labor camp in the past frequently. That certainly seems logical, right? What is the purpose of an economy anyway, if not to satisfy the needs of the populace? To this end the socialist economy is controlled by the government to some extent, the public ownership, or sometimes merely public control, of the means of production. “Collectivization.”
The socialist viewpoint comes to us from the tail end of the Enlightenment period (The Enlightenment was roughly the late 1600s and 1700s), culminating with works of Carl Marx and Friedrich Engels in the mid 1800s. Capitalism was really just getting going in its full extent at the same time, commensurate with the Industrial Revolution. The ancient labor structure, the guild, was at this time just fading away. The guild was an association of small businesses, with “masters” owning the businesses and employing journeyman and apprentices. Under the guild system goods had been expensive, but of high quality. By the early 1800s, in a burgeoning Industrial Revolution, guilds were seen as counterproductive to progress and were now being replaced by larger firms. The master was relegated to a foreman at the larger firm and etc.
Carl Marx was a PhD and an atheist, thinking religion was archaic and to be superseded by his communism. He was “all about the science” way back then, though he was known for apparent contradictions thereof. We get the “Communist Manifesto” in 1848 and “Capital” in the 1860s from Marx and Engels, among other writings. In communist thought, there is ultimately no private property. In their mind, socialism was the same idea, where the means of production are publicly owned. The extreme of socialism is communism, in Marx’s own words. Marx thought capitalism was doomed to fail, and that the rich were getting richer and the poor, poorer. It was all about class struggle. They were all about the “workers” or the proletariat. Revolution was seen as a necessary step in implementing communism, violence, as the ruling classes wouldn’t likely have it any other way.
In the 1860s, while the Civil War was raging in America, a convention was held in Europe called the “First International” where Carl Marx, Friedrich Engels, and others formalized the founding ideas of socialism. One organization that was founded at this time was the International Workingmen’s Association (IWA). This was the intellectual labor arm of the movement. Its job was to start unions around the world as we understand them today, and to literally change the world with a “new social order.” All the old political structures and old religions were to be tossed out and superseded. Marx was the one who said “religion is the op**te of the masses.”
This nebulous “First International” and associated IWA existed in Europe into the 1870s then moved to America where it supposedly petered out. There were IWA movements in various American cities like New York, Chicago, Denver, and San Francisco. In San Francisco there was a bohemian failed law student named Burnett Haskel who started an IWA movement in that city. He was a radical communist, and idolized Marx. Pamphlets from that era titled “What the IWA IS” can still be found. He inspired the formation of many unions there. He also started a commune nearby. While the wild west was raging, San Francisco had some 1960s politics going on even then… There was a lot of violence associated with this movement in the later 1800s.
In theory communism’s adherents such as Vladimir Lenin sought to begin it in the heart of industrialized Europe such as Germany, and even liked the idea of Britain or America, but in practice communism was always directed at the most primitive societies, touted as a means to make all their dreams come true, and expressed in a convincing manner. In Russia the peasants had been serfs up to the 1860s, little more than slaves. Russia, as you know, is obviously where it took its greatest roots as a political movement. But in the labor camp, it took root all around western societies, particularly in the segment of society most impoverished, the lower labor market. In America, it took root. After many battles between crony capitalists and impassioned anarchists wielding sticks of dynamite (think about our anti-capitalist ANTIFA and BLM), the labor union movement in America was strong and unbreakable. It was seen as American and democratic. And it seemed to work at first. Union companies became the largest firms of their type on earth. But then over time, and after innumerable strikes, there started to emerge problems…. In the early days of the industrial revolution, firms were mainly competing within their own shores. Domestic competition. Everyone within that country was on a level playing field. But, over time, that changed. Some protectionist legislation was enacted to protect that home turf, but it didn’t really have the desired effect, and only served to weaken that nation’s domestic industries. You see, competition and incentive is what drives all innovation and progress. It’s the way humans are wired, like it or not. Socialist systems are specifically anti-competition in their DNA. It’s in the early writings.
Of course, we all know that the communist aspiring Soviet Union was born, lived, and died in the 20th century. But there was another movement that followed a similar timeframe in the U.S., the American merchant marine, the predecessor industry to the airline industry. I first came into contact with the story of the merchant marine while researching a family history in the 1990s. I had three ancestors who were chief engineers on ships, one of which became a union business agent, and my father worked in the shipyard industry. This was the subject of “On a Single Stack Steamer: Plying Northwest Waters.” The U.S. merchant marine in the steam era really began in the early 20th century, lived, and then died at the end of the 20th century. America was still kind of stuck in the age of sail long after the British had turned to iron and steel steamships. Work on sail ships was hard, and this helped foster the spread of unions in that industry. I followed the path of an IWA movement in San Francisco that was influential to those unions started there. WWI was the first time the U.S. government got involved with building ships for the war effort, and unfortunately created a bubble of capacity that caused problems following the war.
There was a “Red Scare” following WWI and there was a push in the worldwide communist movement to gain a foothold in the international transportation industry, i.e. the steamship industry. Commensurate with the couple years following WWI was a recession. The communist movement was quashed after this recession and we then had the roaring twenties.
That was great until 1929 and the Great Depression. The socialist Franklin Delano Roosevelt took power at this time. It was in the merchant marine that the idea of the public control of the means of production would be played out to great effect at first, then disastrous effect decades later. The government was involved with trying to promote the U.S. merchant marine by building ships, and even taking over the U.S.’s largest, and world’s largest, steamship line. The unions were known, by commentators at the time, to be influenced by communist thinkers. The “collective” idea was ubiquitous, and strikes were frequent and damaging. Through WWII, the ships built on government contracts, which had begun in the 1930s before the war, became famous. The U.S. took over from the British as the world’s preeminent maritime power. But following the war, strikes resumed in force, and the government was recalcitrant at first to turn over that civilian steamship line that it had taken over in the 1930s. But finally, it did relent. American ingenuity always being what it is, the U.S. invented the Intermodal transportation system, or “containerization.” This transformed the freight shipping world. Of course, people stopped traveling by ship in the 1950s with the emergence of jet travel, but the freight world only grew as worldwide commerce only grew from the 1950s on.
The corporations grew weary of the century long struggle with labor, and socialist minded government interfering in their business. In the 1970s there was a huge industry shakeup with a mesothelioma crisis. The asbestos the steamships were riddled with was killing people. This was a huge hit. Along with this and the other stresses, the whole industry gave up and went overseas. The whole American merchant marine left the country by the year 2000, save the Matson Line out of San Francisco which serves Hawaii, which was only saved by a protectionist legislation called the Jones Act from 1920. Shipyards went out of business too, or were relegated to minor repair work.
The ships were still there of course, just not U.S. ships. Now they were foreign ships built in foreign shipyards….
The Chinese Miracle
Where on earth can we see the capitalist/socialist struggle played out in the greatest spectacle? Where could we find a model to begin some progress at Boeing? I submit to you, communist China. Now I don’t think we should become communist China, as they do some very bad things to people they don’t care for too much, but they are a wonderous example of the command economy collectivization vs market economics at play. They have a government which is communist in doctrine, but their actual experience with pure communism was very bad, and resulting in starving literally tens of millions of people to death. But then Mao Zedong died, and things changed….
Mao Zedong was a man who came after millennia of civilization in China. In the Ming dynasty of 500 hundred years ago, China was the greatest civilization on earth. That’s actually when the Great Wall was built. For millennia Chinese government officials were Confucian scholars. Confucius was a philosopher such as the western Socrates, Plato, or Aristotle who lived way back before the time of Christ. A young man from a good family would study the Analects of Confucius and take a rigorous civil exam, which very few passed. The exam was open to anyone, but only a man from a good family would have the means to study and have a serious chance at passing it.
In the subsequent Qing dynasty (pronounced Ching) China was noted for a slow decline, and in the end exacerbated by European colonial intervention. The British forced tons of o***m on China! Seriously. The Chinese already used o***m, but the British did their best to make sure practically every man in China had all the Indian o***m he could smoke…. By the end of the Qing dynasty, corruption at the top was an issue and the dynasty was very weak. China had previously believed they were the center of the world, and they did not take outsiders very seriously. But the colonial era had changed that and the Chinese came to realize they would have to join the rest of the world. The dynasty fell in 1912 and a period of warlords ensued.
At a prominent Chinese university, there was a librarian named Mao Zedong. He had had a troubled upbringing in a middle-class family. He had a distaste for traditional Chinese intellectuals. Though starting out as a librarian, he was a manly man and loved the ladies, and in his youth not bad looking. He became enamored of communist writings such as “Dialectical and Historical Materialism.” Communism was the new intellectual wave for many between the world wars. Mao would rise above all in China leading the Communist Party there, and actually enjoy a rock star status among China’s peasants.
China fought a civil war over the issue, and communism was obviously popular with the peasants. The communists finally won out after WWII, forcing the nationalist Chinese to Taiwan. China was very poor at this point. In 1950 China had 22% of the world’s population, but it’s GDP was only 4% of the world’s. It was really the poorest place on earth per capita. Conditions needed to improve. When America was living its happy days in the late 50s and early 60s, China was living as close as it could to pure communism and collectivization. This was the period of the “Great Leap Forward,” and it was anything but.
Taking Chinese agriculture for the prime example of the Great Leap Forward, land was taken away from the traditional land-owning class and organized into collective operations. These became quite large. They became noted for many workers loafing around, laying low and hiding. They were not run efficiently due to the demands of the leadership establishment and corruption at the local level. Anything sound familiar? In addition, owing to a disconnect between senior management and the people on the ground, they had all the farms around the country making poor quality steel in local furnaces instead of farming and this greatly took away much needed resources. This horrible philosophical experiment and horrible mismanagement with grossly exaggerated expectations led to tens of millions of people starving to death, quite literally. It was a great leap backward and is perhaps the greatest humanitarian disaster in history.
Mao was a hardline communist. But then he died in the 70s, and his successor Deng Xiaoping did something radical—he started to introduce incentive and competition back into the Chinese economy. Instead of a collective mentality, piece work incentives and etc. Resources were once again divided up into family operations and etc., where incentives began to provide improved productivity. Market thinking, but people were always careful not to call it capitalism. They danced around terms. But the economic conditions in China began to improve dramatically. There was still a government in total control that called itself communist, but they let the market run on its own—always under their watchful eye--with many incentives. But people began to want more, particularly the college students who became prone to demonstrations.
The government reached a point where it would have to totally give in to western thought, or put its foot down. Hence the tragedy of Tiananmen Square in 1989. The government was not willing to give up total control, just a large measure. We see a lot of experimentation in China, and a back and forth. There was now a rich and poor, and a return to some western “decadence” like prostitution. Guaranteed government jobs dried up. It was a competitive environment. There were homeless and etc., but it could not be denied that the lives of the majority were greatly improving, and at an alarming rate. And the rate of economic improvement got only faster and faster. This has led to the “Chinese Miracle” and if we look at a large corporation as similar to a state, we might draw some conclusions as to how to improve that corporation in a fashion similar to China. Clearly, the idea of incentive and competition in China was born out to be economically viable to the extreme. The idea of collectivization the opposite. Given X number of resources, the two philosophies yield opposite results.
Could it be that the communist country of China operates as if it were capitalist, and the capitalist country of the United States often operates as if it were socialist?
Lets look at another example, India. India is a very diverse place. A person from one province often cannot understand the language or culture of another province. Before the British occupied it, it was never a single country, but a place akin to Europe. Much of India is still third world.
After the British left, India became a democracy. But their economy didn’t operate as a democracy. The government controlled everything, in an effort to be completely self-sufficient. This rendered it a de facto communist government. Firms couldn’t fire people, etc. Everything controlled. India’s economy wallowed under this philosophy for decades. Only recently have they changed their attitude and economists believe India will be similar to the Chinese phenomenon. The world is figuring out socialism doesn’t work, but we seriously debate it here in the United States as a viable strategy!
How might we create a Chinese Miracle here in America, such as at Boeing?
Once again we are in a time where people are wondering if Boeing will survive long term. It seems to be making a lot of mistakes in the recent past. Add all the political drama to the mix, and who knows? It’s probably time for another shake up.
Up until now, we have the industrial corporation with a union, and without a union. Most small businesses do not have a union but manage to keep a decent relationship with their employees because of their small size. The owners are close to the work. For the larger corporations, the union ones are, historically, the ones with the best wages and benefits. Though not always, the non-union firms are typically known for less wages, less benefits, and a more uncertain job security. But, they sometimes have a greater job satisfaction as there are less roadblocks in the way to the actual work, and the work can be more enjoyable. But that doesn’t necessarily bring home the bacon. I mean, facts are facts, right? Nonunion firms are sometimes known to be run by little tyrants who are really just in it for themselves. Dog eat dog. Sometimes they run a little leaner and meaner, but it seems somebody has to pay. I worked at an airliner repair station that was nonunion, and it sometimes fit one or all of these characteristics. But it had its good times. One trouble of that industry—was the prevailing rate the firm charged its customers, which was very low. It is a worldwide market and it has to compete with third world countries. So, the business has to run very efficiently to survive, which makes it a good training ground for workers to learn real skills—and for managers to learn real business skills. Toward that end, this particular business operated as if it were a conglomerate of smaller businesses. Funny thing, managers at the time saw that as a negative. Unlike many large corporations though, it really was one team overall. They didn’t fight against one another.
Boeing on the other hand, has all the hallmarks of the major corporation. Major corporations such as Boeing have leveraged their considerable assets to grow ever larger. But for some, their sheer size becomes a liability. Their executive structures compete detrimentally with each other, causing “silos” or little kingdoms that don’t necessarily work together for the greater good. The workers get lost in the haze and shut down, thinking it is all above them and they just worry about their little corner and what makes their day go by with the least drama. They think little about the bottom line, or the big picture. One thing to realize, is that everyone works for their self-interest. It’s what the capitalist system relies on and is fundamental to all of us. The hourly worker looks after their own self-interest in their own way, as does the manager.
People say it needs a union to offset the corporate machine, and I would tend to agree with them. They would very likely press their advantage unfavorably if there was no stabilizing organization to offset them. There are way too many people with way too many agendas, and there has not been a lot of demonstration that there is a ton of ethical morals involved. A few black eyes. Like a lawyer, it is “what can we get away with.” The management regularly demonstrate they are not about the most efficient way to do a thing. There is simply a Boeing M.O. The corporation has its own “FBI” with seemingly its own agenda. Maybe better called a “gestapo.” There are many different interests going in different directions. At the same time, it becomes clear it is very top down in management style, but pretends not to be, and very cumbersomely micromanaged. It is dysfunctional. Still, if one is around long enough, they have to contend that Boeing has some people with skills. It cannot be denied. And that really is the only reason why we can talk redemption. I grew up around the sort of Scandinavian people who built Boeing in Seattle in its earlier days, and they certainly had their strong points, and of course their weaknesses. Now Boeing is far more diverse, and no doubt the better for it.
Transactions at this firm are big ones, and a lot rides on each one. When I was witness to the spectacle of the 787 program, it pushed me over the edge to write a couple of books that had been on my mind, “On a Single Stack Steamer: Plying Northwest Waters” which was inspired by my family history in the American merchant marine over about a hundred years. It tells the on-the-ground story of the effects of organized labor on an industry in the 20th century, beginning to end. And “The Care and Maintenance of Heavy Jets” which is about the sequel to the merchant marine, the airline industry.
Is there a third choice? One besides our idea of a traditional AFL-CIO union and not having a union at all? I think there is. To go back to the days of the guild, but with modifications. It is established that we need a watchdog to have the power to combat the company when it truly steps out of line. The average joe simply does not have the financial resources to combat the company. But in the past, organized labor hurt its position by defending people it should not have defended, taking a communist “collective” stance. There should not be an attitude of defending someone under any and all circumstances. It should run like a court of law. Such as our arbitration process.
On the other hand, we need to create a market like atmosphere where there are incentives and competition, to drive productivity, innovation, and prosperity. Learning from the Chinese example. This is where the Chinese miracle comes from. The most skilled workers should be envied and people try to emulate them. Management of day-to-day operations should be as a real business, not always on one foot hopping almost ready to fall. So much self-induced drama here. People trying to look like they’re important, making mountains out of mole hills. So many easy ways to improve that never ever happen. Too many people making decisions that have no idea what they are doing, or not communicating a good reason to those who could benefit from it.
We learned from the 787 program something that many knew all along—Boeing’s strong suit was always its engineering. Farming it all out proved to be a bad idea. Boeing learned that it needs to have some control of the overall process. But business has learned everywhere that you should do one thing; and do it well. Not making every little part is common business sense. Let someone else be the expert on a thing; and buy it from them. But it seems that Boeing took that idea a little too far and it backfired. The firms made boasts they couldn’t keep and didn’t play well. But Boeing had the right basic idea, and they do in fact farm out so many little parts and no doubt they are better for it, even if it doesn’t seem like it to us on a daily basis. Example. At an airliner repair station they do a ton of structure work. This is of course all custom work. They do it to the manufacturing drawings, the structural repair manual (SRM), and custom engineering. This is actually harder than building a new assembly much of the time. Lots of technicians making new parts from sheet metal. Bending them, cutting them, forming them, heat treating them. Then, installing them. Even at the repair station, experience shows that buying a pre-made part is money ahead where available—and so they do. Someone who makes a batch of something is going to be a lot more efficient at it than someone making a one-off part. Of course they still have to make many parts if they are not available or will take too long to get. All part of managing the business.
The medieval guild was an organization of small businesses that all performed a similar service or made a similar product. Think of a village that had a lot of people that made shoes. The businesses were owned by masters of the trade and employed apprentices and journeymen. The guild had lots of rules to regulate the trade and have a standard of quality. In this it was sort of like a corporation. It protected its secrets, like our modern “proprietary data.” It had rules regarding the conditions by which the employees were governed. In this way it was sort of like a union. Many guilds were very powerful political bodies.
An organization such as a guild-like structure would mean the work would be broken up into small businesses, or groups that appear very close to a small business, run by a master, or partnerships of masters, who employ apprentices and journeymen. Think of a Boeing “franchise” business, like a McDonalds, Jiffy l**e, or Discount Tire (please don’t let your hubris get away with you here, think concept). The entire process is produced by the major corporation, you just insert your ability to perhaps eek out a little more money or time from your life. There of course would be a lot to this, and I outline it a little more in my book “The Care and Maintenance of Heavy Jets” using an airliner repair station as an example. Of course, Boeing would be a far greater scope, but really the same idea at a basic level. Boeing would have to create a system all their own, on par with the Toyota’s process. But it would be truly American.
It is not necessary that everything be so hard as it is now…. The goal would be to come up with a system that worked as a market, as a market self-cleanses itself and doesn’t need a “corporate shake up” every so often. In business, a body that produces a great product or service for a decent price is always going to have more clout at the bargaining table than one that produces a shoddy product or one that is overly expensive. Inefficient also means expensive, and efficient means value…a value that is worth something.
Christian Parker
