Azerbaijani cotton worker and politician Basti Bagirova at the cotton harvest in 1950, the fifteenth anniversary of the Stakhanovite movement.

7

THE CHANGING SIGNIFICANCE OF WORK, 1800 TO NOW

The crucial changes to labour relations in the last two centuries, described in the previous chapter, had a number of implications. These are related to the massive shift of work from within households to outside and, consequently, the increased need to publicly regulate work and labour relations. The three most important implications of this are: the changed meaning of work and free time in people’s lives (pp. 363–75); an entirely different self-organization of, in particular, the increasingly dominant group of wage workers (pp. 375–97); and the continuous amendment of labour legislation and regulations (pp. 398–421). These three implications are the focus of this chapter.

Due to the global shifts in labour relations from unfree to free labour and from self-employment to wage labour, the significance of work changed and there was increased space for other activities in people’s lives. A contributing factor in this regard was the gradual shift in the last century from heavy manual work to lighter mechanized work and to intellectual work. The income from self-employment and wage labour increased slowly but surely and with it grew free time and the opportunity to consume. Life became more than just a vale of tears; that is to say, improvement came within reach of more than just the happy few. It became worthwhile to invest in training and education, and thus the lives of children became more important. Children went to school more and therefore went to work later.1 More and more people reached a stage in life where they could not or even did not have to work. All this led to leisure becoming more important, initially in rich countries and more recently in many other parts of the world.

These changes and shifts did not happen automatically. Various groups of working people and, in particular, wage workers, have made a major contribution to this, individually and through self-organization. Initially building on the self-organization experiences of self-employed craftsmen and their helpers and the experience of ‘spontaneous’ collective movements, including strikes by all kinds of workers, the workers’ movement developed and, in particular, the trade unions. A key stimulus for this was the international and soon-to-be global exchange of ideas and experiences.

Collective actions and organization were not limited to the employer–employee relationship. After all, under the influence of these major shifts, labour laws and regulations had to be constantly adapted. From rules within the household regarding parents, children and slaves, they became increasingly public and shifted from being local to national and, ultimately, international. The employment contract and remuneration, job placement, workers’ right to association and to meet, and legislation in the area of working conditions and social security increasingly determine the lives of working people.

The growing national legislation with respect to work and, simultaneously, the steady democratization have enhanced the role of the state in determining the rules around the labour market and labour relations. From this, welfare states of various shades have emerged, but, as recent history is teaching us, not without serious challenges.

Work and leisure

The long-term tendential global shifts in the last two centuries, from unfree to free and from self-employed to waged labour, have had important implications for the appreciation of work in general and also for different types of work. In previous chapters, we have observed that the elite’s demeaning and pejorative opinions on work mean we are quick to forget other, more positive voices, inter alia from urban craftsmen. This positive appreciation of work now becomes much more dominant. Among the physiocrats, agriculture and agricultural work were most highly appreciated. Similarly, the Scottish economist and philosopher Adam Smith still believed that ‘the labour of farmers and country labourers is certainly more productive than that of merchants, artificers and manufacturers’, although in the next sentence he appears to refute this prevailing physiocratic idea: ‘The superior produce of the one class, however, does not render the other class barren or unproductive.’2 In the nineteenth century, the emancipation of industrial versus agricultural labour was quickly achieved, though moral objections to mechanization, deskilling and urbanization were long-lived and, in a way, still survive today.

From the time of Adam Smith and, somewhat later, the political economist David Ricardo, labour has pre-eminently been considered the source of productivity, and – especially since Karl Marx – as the sole source of value. Communist, socialist, Christian, National-Socialist and fascist propaganda all exalted labour. Moreover, and more generally, in recent centuries and across the political spectrum, labour has come to be accepted as the foundation of society – if not out of conviction then as a necessary result of the fact that universal suffrage has made the working class, conceived of as both important producers and consumers, an important political force for the first time in history.

The combination of continuing occupational specialization and improving labour productivity has had many effects. To start with, there has been an explosion of the world’s population, from 1 billion in 1800, 2 billion in 1925, 4 billion in 1975 and 6 billion in 2000 to a predicted 8 billion around 2025. Next, there has been a much slower but, nevertheless, undeniable rise in living standards of the majority, in particular in the twentieth century. This implies higher life expectancies, often lower working hours and the prospect of improving one’s social position by social and/or geographical mobility, thus stimulating investments in childhood education.³

Consequently, work occupies a diminishing proportion of our life: in comparison to our parents and grandparents, most people nowadays start their working life later and work fewer days and hours during their working life, and an increasing number of us can expect to live a number of years as a pensioner. We must therefore consider more closely the development of working time and free time and the balance between the two over the last two centuries among different types of workers in different parts of the world.

Starting work later

We have previously seen the general rule that children were involved in household activities as soon as possible – little by little and learning by example. That was the rule for by far the largest part of the population and it involved no formal education. Twenty years ago, the anthropologist Barbara Polak described this process for Bamana children in Mali:

[At harvest] three-year-old Daole begins to pluck beans from the tendrils. After he has filled the lid with a handful of beans, his interest fades. [He] carelessly leaves the lid with the beans lying on the ground and goes looking for some other occupation. Five-year old Sumala looks out for a corner not yet harvested and picks as many beans as will fill his calabash. [He] keeps doing this for more than a half hour. Eleven-year-old Fase has been busy harvesting beans since morning. He works as fast as his father and grown-up brother and only takes a rest when they [do]. Fase is fully competent with regard to harvesting beans. He even takes on the role of supervising his younger brothers and checks their performance from time to time.4

Similar scenes can still be found among the poor and the modestly self-employed in countries without efficiently controlled compulsory education, although increasingly rare in the past century and a half. How did this change take place?⁵

We must start at the point when children’s work moved outside of the home. Initially, this happened mainly in a family context: the head of the household went to work in a factory or a mine and took with him as many members of the household, including children, as necessary. Consequently, child labour not only came indirectly under the supervision of third parties, but it also became much more visible, especially for critics of the new factory industry. This was further reinforced when employment contracts became individual and children ended up working directly under factory bosses.

As a result, legislation to limit child labour was enacted and, simultaneously, a movement to promote compulsory education emerged. This started with the English Factory Act of 1802, which set a maximum of 12 hours a day for pauper apprentices in textile mills, and which was followed by the more effective and far-reaching 1833 Factory Act. Generally, the effect of this kind of restrictive legislation was minimal, not least because it could be systematically evaded by employers and parents due to a serious lack of inspectors and the ridiculously mild penalties.

Mandatory and free full-time school attendance of the kind seen in mid-nineteenth-century Prussia was certainly much more effective, although only the rise of real adult wages at the end of the century became decisive, because it allowed parents to abstain from using their children to supplement their income.6 By 1900, most of Western Europe required compulsory school attendance until the age of 12 or 14. This did not prevent child labour in family enterprises, like a peasant farm or a shop, however. Many children still worked before and after school and during school holidays, which were sometimes arranged to facilitate obligations such as the potato harvest in autumn.

On the other hand, based on pure necessity or a weighing-up of interests that many readers may find difficult to comprehend, parents continued to push or even exceed the limits of the legislation. The collaboration of parents with recruiters of child soldiers or in child prostitution is an extreme example of this. Of course, most vulnerable were those children outside the protection of a family, many of whom experienced extremely high mortality rates. Those who lost their mothers – and many women did die in childbirth – ran the risk of ending up in an orphanage and being put to work. Take the example of the demand of cheap, and therefore often, child labour in the white settler colonies. Indeed, London’s street children had already been sent to Virginia while it was still a British colony. Later, homesteaders without children in the ‘pioneer era’ in the American West also had a great need for labour. By 1929, about 200,000 children from orphanages and foundling homes in cities on the east coast had been carried in ‘orphan trains’ to families in the West and Midwest.⁷ But the most extreme type of exploitation of children (mainly) without parents takes the form of child soldiers in a number of countries, especially in Africa and Asia.⁸

Nevertheless, statistics on literacy and school attendance teach us a clear lesson, even if we allow for the possibility of combining working for wages and attending school full time.⁹ In the heyday of the British textile industry, for instance, half-time work in the morning and half-time school in the afternoon was common practice. Whereas previously only elite families, sometimes grouped into castes as in the case of the Indian Brahmins and Kayastha (scribes), had the means and the ambition to postpone work for their children by sending them to school, work specialization and rising standards of living extended this practice to wider sections of the population. In 1800, slightly more than one-tenth of the world population over the age of 15 had attained at least basic education, but by 1900 this had become one-third, by 1950 one-half, and today it is over 80 per cent. This attainment is spread very unevenly over the globe, however, with sub-Saharan Africa and, to a lesser extent, South and South East Asia lagging far behind the rest.10 The geographical and temporal variations are also broadly explained by something as simple as dependency ratios: ‘child labour is surely normal in an economy containing a high proportion of children’.¹¹

Concomitantly, we can be sure that the age at which people started to work has risen substantially. In the mid-nineteenth century, worldwide, on average, children went to school for one year, in 1910 for two, in 1950 for more than three, and today it is an average of eight years, with the aforementioned regions still lagging behind.¹² This suggests that, globally, we now start working at around the age of 15, rather than at the age of 7 or earlier.

Working hours and days

As we have seen, where workers can determine their own working time, the boundaries between household labour (with peaks and lulls in agriculture), the care for household members and self-employed work for the market can be quite fluid. Nevertheless, all agricultural societies already had formalized periods of public rest, either in the form of fixed days per week (think of the Jewish, Christian and Muslim traditions of a mandatory weekly day of rest), or in the form of regular festivals (as in the Hindu tradition, including the Kumbh Mela). The two could be combined by celebrating fixed saints’ days. On a personal level, people could take days, months or even years off for pilgrimages, as we have seen in the case of the hajj.

These customs and conventions were not immutable, even if they were grounded in religious convictions. We have already seen that, as part of the Reformation in Europe, public free days for religious reasons had been restricted, thus substantially increasing the annual number of working days. The history of working time over the last two centuries has been even more dynamic. The advance of wage labour gave employers a chance to extend working times to unprecedented levels until the counterforce of the organized labour movement brought them down stepwise to all-time lows in the last quarter of the twentieth century, at which point they seemed to stabilize or even increase slightly again. Soon, the same organizations advanced the idea of an annual holiday for wage labourers. The increase in general incomes in the West, especially after the Second World War, made this idea feasible and also attractive for the self-employed and for society in general. Later, it would be emulated elsewhere in the world.

The growth in the number of workdays that commenced during the Reformation continued in England during the Industrial Revolution. The trend towards extending the working year is reflected in, for example, the number of days on which the Bank of England remained closed. In 1761, this was still forty-seven. It had reduced to forty-four days in 1808, forty in 1825, and then it rapidly decreased to eighteen in 1830. By 1834, it was a mere four, namely, Good Friday, Christmas Day, 1 May and 1 November. In addition, Boxing Day (26 December) was not usually worked in England. It took until 1871 for Boxing Day, Easter Monday and the first Monday in August to be added by law. Such a law was particularly revolutionary for England, with its state church, because these days were no longer regarded as religious festivals, but as secular days of leisure, especially Boxing Day. In the cradle of the Industrial Revolution, then, the tide of the ever-increasing work year had turned, at least with respect to public holidays.13

Even more crucial, of course, is the length of the working day. Indeed, one of the best-known consequences of early industrialization was the extension of the working day for wage workers in factories, along with a wearying labour of women and children. Inevitably, workers responded with absenteeism, especially on St Monday, when the intoxication of the free Sunday would be slept off. Bosses even tolerated this from good workers.

More structural than St Monday were the legal measures introduced to restrict maximum working hours.¹⁴ Step by step, the infamous 12-hour workdays and the even longer work periods of nineteenth-century factory operatives were limited and reduced, first for women and children, and then for men. This happened initially in some white settler colonies like Australia and New Zealand, and later in the North Atlantic, revolutionary Russia and other countries. Preceding the legislation histories of separate countries, this important first stage was completed with the establishment of the 8-hour working day. In many countries, this occurred during the turbulent end to the First World War. A few years later, a 48-hour (rather than a 45-hour) workweek prevailed in the most important branches of industry in Western Europe.¹⁵

The labour movement, which for decades had championed the 8-hour workday, vaunted its achievement, in particular during its May Day celebrations. France’s socialist prime minister Léon Blum, who dared to introduce a 40-hour workweek in 1936, remarked emotionally that, on the rare occasions when he left the ministry for a long walk through the banlieues of Paris, he saw roads teeming with bicycles, tandems and motorcycles ridden by colourfully dressed working-class couples, who seemed to radiate a natural and simple coquetry about their free time. It was not just that they no longer sat in a pub, or had more time for their family, but, said Blum, ‘they had gained a perspective on the future, they had gained hope’.16

Ultimately, the radical reduction of the length of the workweek in France in 1936 was not sustainable, but this ideal soon became reality elsewhere. Already in 1940 in the US, and following post-war reconstruction, many European countries adopted a five-day workweek by adding a free Saturday, totalling a maximum of 40 hours. In 2000, France reduced the maximum to 35 hours. In fact, these figures should be seen as thresholds above which overtime (for blue-collar workers) and rest days (for white-collar workers) kick in.

Another reduction of working hours took place with the introduction of paid holidays. The cumulative effect of these three measures – reduction of working hours per day, per week and per year – was most clearly visible in the last decades of the twentieth century. In one of the world’s most prosperous countries, Germany, the annual working year has decreased from 3,000 to 3,500 hours in 1870 to 1,500 in 2005.¹⁷

We should not, however, simply calculate the average number of hours. As we have seen, agricultural work is characterized by sharp peaks and troughs, with harvest peaks seeing workers toiling from the crack of dawn until they could no longer see their hand in front of their face. This was offset by long idle periods, especially in the winter in northerly areas. The occurrence of night work – known to place an extra burden on the human organism – has also increased significantly. Originally, the lack of adequate and cheap lighting meant that night work was exceptional. Bakers were a well-known exception. With the spread of artificial light, however, night work and 24/7 shift work increased sharply, sometimes in the face of long-established taboos.¹⁸ Combating night work was initially also an aspect of social legislation, but it has long been quiet on this front.

Economic growth was the decisive change that led to short-time working in the North Atlantic from the 1950s/1960s. The worker could now buy more with less work. To maintain that purchasing power, the same worker and his or her partner have had to work more hours since roughly the 1980s. Until the 1970s, the number of hours worked per job averaged between 1,900 and 2,000 per year. Subsequently, we see a divergence, and today it is 1,400 to 1,500 in France and Germany, 1,700 in the UK and 1,800 in the US. The gain in Western Europe is the upshot of shorter workweeks and longer vacations.19 In Japan, the number of hours worked is much higher due to extreme forms of overtime, with all the associated negative health consequences.²⁰ Whereas for many working people in the North Atlantic work had long been an (admittedly necessary) exception and leisure time had become the rule and the purpose of life, the pendulum now appeared to swing to the other side again.

At the same time, as labour came to be considered as the main if not sole source of wealth, a new distinction emerged. Because of the growing role of education, the esteem for white-collar work grew at the expense of blue-collar work, increasingly considered to be purely manual and therefore menial. Yet, this development was far more striking in Europe and Asia than in the US or other white-settler colonies, with their traditional labour shortages.²¹

We must not lose sight of the fact that this reduction in working time has always concerned wage workers, in particular those working in middle-sized and large companies. Key sectors fell outside of this, namely, the rapidly growing army of servants, who had to be available day and night and satisfy themselves with a few hours off on Sundays. The working hours of the self-employed and the semi-self-employed in the sweating industry echoed this reduction, albeit from a distance.

This initial, and ultimate, trend towards fewer working hours is also visible beyond the richest part of the world, albeit to a lesser extent and with significant delay. The growing chasm between rich and poor countries that, until recently, seemed irreconcilable sometimes makes us forget that there has been a certain shift from work to leisure time in poor countries too. An example of this is the growing popularity of pilgrimages such as the hajj.

After a decline in the nineteenth century, the pilgrimage of Muslims to the holy places of Mecca and Medina regained significance, following the emergence of regular and cheaper steamship connections. Numbers of pilgrims increased after the Second World War, from more than 100,000 in 1950, through around a million in 1974, to 3 million in 1985. Given that the total population of the Muslim ummah at the time amounted to 750 million people, and supposing they reached an average age of 50, as many as 20 per cent of them would experience pilgrimage once in their life.22 In reality, the figure is probably lower, because some of them travelled to these holy sites more than once. Still, the time that Muslims spent on pilgrimages must not be underestimated, firstly because there were many more holy places that attracted pilgrims, and secondly because of the time that such a journey took up.

While before the war, the annual hajj drew approximately 300,000 pilgrims, in 1937 250,000 Muslims visited a shrine in Senegal, several hundred thousands went to a site in the Nile Delta and nearly 100,000 travelled to one in Algeria. It is easy to go on like this, for example by listing the six most important shrines for Shia Muslims outside of Mecca, four of which are in present-day Iraq, but it is much harder to compile historical statistics in this regard.²³

These pilgrimages took a long time. Indian pilgrims who chose the sea route departed in March and returned in September. Those who had not spent too long travelling within India from their residence to the seaport were away from home for half a year. It was only the introduction of steamships that reduced the total time of the pilgrimage to a few months, and at the end of the twentieth century, the plane cut this to a few weeks. Prior to this, the journey overland from Damascus took a total of three months, and from Cairo it was five.²⁴

I have spent some time reflecting here on the significance of the pilgrimage in the life of a devout Muslim. Although the hajj could certainly be combined with economic activities, it is still largely a pastime that must be distinguished from work in the strict sense, but which also cannot be characterized as leisure time. It falls clearly within the obligations that, as noted in the Introduction, Nels Anderson described as ‘roles in which status must be earned, and the effort may be highly satisfying. The effort may be equally as satisfying as leisure activity’. The same is true for pilgrimages in other religions. The implications of this for the problem that we are dealing with here – that is, the time when people are not available for work in the strict sense of the word – nevertheless seem limited. The time spent on the hajj is, on average, likely to amount to no more than a few workdays a year for the total world Muslim population.²⁵ In general, we arrive at an average ‘loss’ of, at most, one day per year for the one-off great pilgrimages, a few days for the lesser ones that are undertaken several times in a person’s life or even annually, and perhaps a week for funerals.

Finally, let us not forget that working hours within the household – in the form both of unpaid work in family enterprises and of classic care and daily housekeeping – were rarely if ever affected by the regulation of working hours outside.26

Retirees

Until rather recently, increased life expectancy automatically meant that, on average, people could work more years. Especially in the last century, however, this increase has become so impressive that, for many, a life after finishing a working career has become possible. We can be sure that this applies to a majority of the population wherever average life expectancy passes 70 years of age. As with education, this has happened at different moments in different parts of the world – in Western Europe and its offshoots already in the 1950s, in East Asia in the 1980s, in Latin America and the Caribbean in the 1990s and in most of the rest of the world after 2000, with only sub-Saharan Africa lagging far behind.²⁷

At the end of the nineteenth century, men over 65 were still gainfully employed in the most prosperous countries, but 50 years later this had become a minority, and later in that century the age brackets of 60–64 and even 55–60 were to follow this trend.²⁸ This became possible with the introduction of nationwide pension schemes. They were based on centuries of experience with the mutual pension schemes of small occupational groups – as a rule, of craftsmen, sometimes including their spouses, as we have seen in Chapter 5 (p. 233). At the same time, the positive appreciation of retirement gained ground. Two cohorts of Parisian workers on the point of retirement in 1972 and 1984 demonstrate this shift in attitudes:

The younger cohort had a more positive view of retirement, either as a mixture of rest, family life and chosen activities (often useful ones), or as a new stage in life with more social, intellectual and leisure activity. Retiring ‘early’, that is, around 60, gradually became, between the mid-1970s and the mid-1980s, not only socially acceptable, but the new social norm. . . . Retirement was seen as a positive stage of life by the majority of the mature active population.²⁹

In recent decades, a counter-movement has started. In many countries, retirement ages are rising again due to the heavy costs of pension schemes. Apart from demographic reasons (a less favourable ratio between active and inactive individuals), this is also caused by the diminishing willingness of governments to contribute.30 And for the growing number of self-employed without pension provisions, stopping work at an early age is neither an attractive nor a realistic prospect in the light of waning welfare state provisions for the elderly.

The balance between working and free time

The culmination of this was a divergence between the meaning of leisure time and work. Both became more important. On the one hand, free time is highly valued, because it allows you to enjoy (read: consume) your wages. On the other hand, it requires work, indeed hard work. Already in 1884, the Scottish entrepreneur (and later MP) Alexander Wylie pointed an accusing finger at his fellow captains of industry and at economists who, according to him, tried to justify lengthy workdays and unfair social inequality with spurious arguments. Wylie argued that, ultimately, poor workers are just as much the victims of the desire for luxury as their bosses are.³¹ That is to say, they spend a disproportionate amount of their wages on alcohol, tobacco and the excessive consumption of sweets, rather than on healthy foods, educating their children or saving it up for less fortunate times via consumer co-operatives, mutual insurance and building societies.

A few years before, Paul Lafargue, the Creole son-in-law of Karl Marx, wrote his passionate and satirical The Right to Be Lazy (Le droit à la paresse). In this pamphlet, he did not so much defend laziness as the right to free time for workers, which, he believed, could easily be facilitated as a result of the successful mechanization of the previous century. As if intoning a prayer, he concluded his tirade against the exhaustion of the workers with the appeal: ‘O Laziness, have pity on our long misery! / O Laziness, mother of the arts and noble virtues, be thou the balm of human anguish!’³² Instead of consuming what the workers produced, the bourgeoisie should grant them higher wages, which would enable them to work far fewer hours. More optimistic than Wylie, Lafargue believed that the choice for workers would be obvious. Instead, the bourgeoisie – if stubborn – would perish because of their gluttony, their drinking and their greedy, decadent behaviour.

A futuristic echo of this appeal can be found in a statement by the Russian artist Kazimir Malevich, in his Laziness as the Real Truth of Mankind of 1921: ‘Everything that was done in the past was only the work of man; in the present man is no longer alone, but with machinery. In the future only the machine, or something that is similar to it, will remain.’33 Now, a century on and a plethora of such predictions later, we know that work has not stopped because machines have taken over. Ultimately, we still work because of our propensity to consume more and better (this also applies to healthcare, particularly expensive in the absence of proper public provisions). The Tillys pointed to this paradox by interviewing adults from forty countries in 1995. The respondents were asked to choose between two options: ‘Work is the important thing – and the purpose of leisure time is to recharge people’s batteries so they can do a better job’, or ‘Leisure time is the important thing – and the purpose of work is to make it possible to have the leisure time to enjoy life and pursue one’s interests’. A wide variation appeared across countries. Roughly two-thirds in Brazil, the Philippines and Saudi Arabia rated work more important than leisure, whereas half or more in the Czech Republic, Denmark and Great Britain put leisure first.

Particularly striking, according to the Tillys, was the inverted relationship between attitudes and behaviour. ‘In other words,’ they conclude:

the more people claim to value work for itself, the less they work; the more they work, the less importance they place on work. Why? One explanation is that as countries become wealthy, two things happen. On the one hand, standards of living rise and consumption is increasingly commoditized, requiring additional income-earning labor . . . to live at a generally accepted standard. On the other hand . . . People are more likely to be working for someone else and correspondingly less committed to work for its own sake. So as nations grow richer their people work more and like it less.³⁴

This at least goes for paid work, which invariably maintains a high status. It also explains the motivation of many pensioners to carry on in one way or another. At the same time, it emphasizes – apart from lower incomes – the problems of those outside the workforce, in particular the jobless. In the 1960s, an unemployed English miner expressed his ambivalence to work and leisure perfectly: ‘Frankly, I hate work. Of course, I could also say with equal truth that I love work. . . . Nor have I ever met anyone who liked work, or to be precise, liked what blokes such as me understand by the term . . . It would seem clear that it isn’t really work that we are talking about, not the thing in itself, but its association.’ What this association means is expressed by another unemployed man: ‘You felt you were playing part in the community [when working]: it was all right for someone to go to work from nine till six and bring a certain amount home . . . You weren’t shoved on the scrap-heap, rendered useless . . . Well, you might as well be dead.’35

Promotion of interests: Individually and collectively

Anyone who works is apprehensive about the deterioration of his or her working circumstances and of the remuneration for that work. At the very least, they will try to maintain the status quo and, if possible, improve it in relation to earlier conditions or compared to others. This promotion of interests occurs individually, but, outside the household and under certain circumstances, also collectively (see, for earlier periods, Chapters 4 and 5).³⁶ If we concentrate here on the wage worker, then the individual strategy will focus first on the employer and his representatives. For the self-employed, the same applies to their client(s). In both cases, it is ultimately about entering into and complying with the most favourable contractual obligations possible. As we have seen, the choice for education precedes this, as do other household strategies, including marriage arrangements.

The collective strategies of the self-employed, employees and employers – insofar as they are not related to each other – include, firstly, the formation of alliances with fellow sufferers and, secondly, the effective manipulation of public opinion. In the last two centuries, this has also meant a shift from local to national and even international and global. The options in both strategies then vary according to the economist Albert Hirschman’s famous systematics between loyalty (actions aimed at maintaining the status quo), voice (striving for improvement) or exit (if nothing helps to openly or secretly evade or circumvent the situation).

This analytical distinction between individual and collective strategies and tactics does not preclude strong links between the two in the life of individuals, as well as at the national level. In immigration countries like, for example, the US, Canada and Australia, the initial predilection of newcomers for individual betterment resulted in a substantially longer working day and year than in their European countries of origin. There, working hours were diminished by the collective action of trade unions and political parties, and, in particular, also by the extension of holidays (see pp. 368–9).³⁷

Individual strategies

In terms of individual strategies among artisans’ apprentices, servants of small self-employed businesses and wage workers, we should think of strategies to forge a good relationship with the boss and with co-workers, of attempts to keep learning, and of migration. Let us imagine that very concretely. An English working-class boy, who entered the labour market at the age of 10, following the premature death of his father in 1900, had already worked it out, or at least his mother had: ‘I went accompanied by Mother to a very well-known second-hand clothes shop in Salford, Herzog by name. I was fitted out with coat, trousers, shirt, stockings and shoes for the sum of four shillings and sixpence, which was a lot of money in those days. . . . The following Monday morning my mother accompanied me “looking for work” and we were not long in finding it.’38 In addition to making a good impression on the boss, the relationship with co-workers also counted. We have seen already how, for example, all the members of a gang of Lippe seasonal brickmakers had a direct interest in efficient cooperation in production (p. 225). This entailed not only working efficiently together but also social skills, as these workers shared food, free time, and also twin cribs during the season; in short, they shared everything, night and day. Every year, before the start of the season, gangs were recomposed anew on the basis of reputation. The best workers could make it to gang leader.³⁹

As these two examples show, the way in which one joins a company is already determinative of subsequent mutual relationships. Most people with a job have never seen the inside of a labour exchange or commercial recruitment agency, while others have visited them many times; yet others used to consult adverts in newspapers, and nowadays their job search starts on social media.⁴⁰ There are, indeed, numerous ways to find employment, ranging from the very personal to the anonymous. Take Pol de Witte, the son of a Ghent cotton spinner: ‘One night in December 1857, Pol’s father came home, announcing that his young scavenger had left, and that he would take his son with him from then on. There were two advantages: the pay of 3 francs [to the scavenger] was saved and the boy would learn to work. Pol was nine years old at the time. After vehement protest by the mother and her son, Pol started working next morning.’⁴¹ Personal mediation may be used to solicit a job or an apprenticeship, to enter school (aimed at a particular job or profession) or to switch roles between firms or within a (big) firm. In the latter case, this involves so-called internal labour markets that exist not only in big firms, such as railway companies, but also in large institutions like the army, the navy and the church.42

A less personal way of finding a position involves job intermediation by way of professional networks, like guilds, the compagnonnage, trade unions and employers’ organizations. Essentially, commercial and public employment services or labour exchanges are anonymous. In nineteenth-century Europe, mediation by guilds diminished, only to be partially replaced by similar structures. In central and southern France, for example, some 200,000 compagnons embarked on a tour de France, travelling between affiliate guesthouses that provided mediation, as well as viaticum if necessary.⁴³ Similar structures existed in the German-speaking world and, in a way, still exist. In the twentieth century, public labour exchanges gained importance, mainly because of their role in the execution of unemployment provisions. In recent decades, commercial mediation has been ascendant again.⁴⁴

Whereas decisions among co-operative workers about career opportunities were taken independently, workers engaged individually were much more dependent on their supervisors and bosses. In a metal-polishing factory in New Delhi at the beginning of this century, it was observed that among the necessary social skills to survive among mates and bosses was the ability to banter, often in a highly sexualized manner:

There is . . . the sheer delight in the play of touching, grabbing and displaying the male genitalia, as a way of embarrassing and entertaining each other. At the end of the shift, when several workers cram into a single-person latrine and adjoining small chamber to bathe, one must not only struggle to scrub oneself off of the caked dust and grime of the day with the abrasive detergent soap provided by the company, while taking care to avoid accidental fingers, elbows, or knees in the eyes within the congested space. One must also keep a check on one’s underwear, which everyone wears inside the bath, lest it be pulled down to one’s knees by someone or some persons working in concert, followed by uproarious laughter as the hapless fellow pathetically tries to pull it back up.⁴⁵

Foremen in this factory also engaged in such horseplay, and suggestive remarks were made about homoerotic services rendered in order to advance one’s interests.⁴⁶ This may be an extreme way of ingratiating oneself with supervisors and bosses, but the importance of maintaining good relations with superiors, either by working properly or by appearing to do so, is obvious. The Chinese factory girl Chunming, whom we met earlier, quickly understood how it worked, and improved her position, albeit at a price.47 On 26 March 1996, she wrote in her diary: ‘My promotion this time has let me see the hundred varieties of human experience. Some people cheer me, some envy me, some congratulate me, some wish me luck, some are jealous of me, and some cannot accept it . . . As to those who envy me . . . I will only treat them as an obstacle on the road to progress, kicking them aside and walking on. In the future there will be even more to envy!’ The Chinese American journalist Leslie T. Chang comments: ‘Chunming studied the higher-ups in her factory, as intent as a biologist with her specimens. She observed that when the head of the human resources department gave a speech, he was so nervous that his hands trembled. Around the new year, a manager on the factory floor ignored her until she boldly wished him a happy new year; he responded warmly and gave her ten yuan in a red envelope, a traditional gift.’ Chunming reflects on this experience in her diary: ‘From this incident, I understand: Some people who have always seemed unapproachable may not really be so. You just need to make yourself a little more approachable.’ Chunming also defended and advanced her position by taking courses. In fact, no job promotion was possible without training. Becoming a good craftsman took many years of apprenticeship, as a rule as a resident. Factory workers managed with less, but those who wanted more took evening classes. Big firms, interested in a stable labour force and therefore in an effective internal labour market, may also offer such classes, or occasionally paid training. Large enterprises are well-known for this (one of the secrets that explains the phenomenon of Japan’s ‘salary men’), as are certain government jobs around the world, in particular in the armed forces.⁴⁸ The overall trend in job training over the last century has been for the extension of general and professional education for youngsters, and incidental but regular refreshment opportunities for most of the workforce.

The mirror image of individual promotion of workers’ interests is the behaviour of employers. Just as workers choose their bosses, the same is true vice versa. A number of factory owners, particularly interested in a stable and reliable workforce, but at the same time with idealistic motives, did aim at maximizing profit, but believed that they could guarantee success by investing in the well-being of their workers in many ways. On the occasion of the delivery of his hundredth steam engine in 1873, the Dutch machine builder Charles Theodoor Stork invited his 500 to 600 employees to the Bourse in Deventer. Seated at long tables, ‘each with his plate, glass, and half bottle of wine in front of him’, they listened to his views on labour relations, expressed in plain language in the local dialect:

[Manufacturers] work with the pen and with the head, which is even more difficult than with the hands and they often have concerns that you don’t know about this. . . . There are those who think that [manufacturer and workers] are hostile to each other, but they are quite wrong: if everything is as it should be, then we should treat each other as good friends. The workman must trust that the manufacturer . . . thinks well of him, that he considers the good and considerate worker to be his neighbour, as a man created by God and not as a machine.49

Stork is also clear about why he differentiates between wages according to performance, and it is not because the government in The Hague has ordered him to do so:

Everyone gets reward for his work, the industrious and careful and those who understand work well. That is a good law, a law that applies everywhere. That is a law that is not made in The Hague, where the gentlemen who make the country’s laws meet, but one that says the industrious and the careful fare better than the lazy and those who do not want to fit in. That is the law of our Lord and that is why this law is good!

Each country has a number of such examples, albeit in varying degrees. Almost without exception, employers like Stork, running family enterprises rather than joint stock companies, might pay better wages and provide clean working places, as well as schools, housing and parks. These employers not only tried to avoid and prevent social conflict; they also carved out a role for themselves in the wider society – not only by hoping that colleagues would follow their example but even by setting a standard for government. As Dolf Kessler, the first director of the Dutch steel producer Koninklijke Hoogovens, put it: ‘We must always be one step ahead of the social legislator’. The same applies, to a certain extent, for the Indian Tata Iron and Steel Company, who have been the owners of Hoogovens since 2007.⁵⁰

Moreover, the attitude of factory owners and management is also prone to change.⁵¹ From paternalistic types such as Stork, it shifted, in the sellers’ market after the Second World War, to, in particular, highly trained engineers who were preoccupied with production capacity and thus a good relationship with workers and their organizations. And via the buyers’ market in a period of overcapacity (1965–90), when the power in companies ended up in the hands of sales and marketing managers (inclined to leave the actual production to innumerable subcontractors), we have finally landed in a situation where business managers and financial gurus rely on control of the distribution channel through branding. The fact that the personal link between management and labour has weakened so severely is important for our subject. Add to this the explosion of the remuneration levels for business executives, made possible by diminishing fiscal progressivity in the absence of the countervailing power of organized labour,52 and it becomes clear that the strategy of individual wage dependents must also change, both individually and collectively (see below).

If it is impossible for a worker to improve his situation or, worse, if he or she cannot prevent its deterioration, finding a new job offers new opportunities. This turnover of labour has aptly been called ‘the individualistic strike’.⁵³ The chances of success, of course, depend on general trends in labour demand and on specific circumstances. Turnover rates are highest among low-trained temporary workers and general labour – a classic example was during the heyday of US immigration. Ultimately, the individual strategy of wage labourers often turns out to be purely defensive. A corollary for the self-employed is the serial start-up of new businesses, occasionally accompanied by insolvencies and bankruptcies.

From about 1840, geographical and, as a consequence, social mobility is most pronounced. Urbanization and international migrations are the clearest examples of this.⁵⁴ Urbanization increased rapidly in Western Europe after the Napoleonic wars, in Russia from a half-century later and in Asia in the twentieth century. International migration, which has long been of great significance, rose sharply when steam shipping greatly reduced the costs of passenger transport over water; the railways subsequently did the same for land transport. The most spectacular migration flows – all in the same order of magnitude of 40 to 50 million between 1840 and 1940 – promoted by these developments were those from Europe to North and South America, those of South Asian and other indentured labourers to sugar and other tropical plantations in America, Oceania and Asia, and those of south Chinese farmers and agricultural workers to the north-east. This is not to mention the migrations of sailors and, especially, soldiers in the context of the numerous colonial and other wars, including the first and second world wars.

No matter how big and dramatic the step was from smallholder to factory worker, from the countryside to the city and from one continent to another, this kind of transition occurred gradually rather than suddenly (as in the case of the above-mentioned Bakhtiari pastoralists) by way of stepwise migration. A man goes to work somewhere else, for example, and once successfully established he brings over his sister, his friend, and so on. Or, a worker emigrates first from the countryside to a small town, and subsequently to a large city. This even goes for the Russian serfs and their descendants, for example.55 Already in the course of the eighteenth century, some had the opportunity to work part of the year in urban industries, when they could be missed from compulsory service. Following the abolition of serfdom in 1861, they continued this custom to a much higher degree, and with the redistribution of land additional income from work in urban industry and migrant labour was essential in many regions of the Russian Empire.

The aggregate result of these numerous individual decisions to opt for loyalty, voice or exit have contributed substantially to the major shifts in labour relations over the last few centuries. The classical case involved people who decided to give up their small farm or craft enterprise to go to work in a factory, in their local or neighbouring town or overseas – mostly combining geographical with professional mobility. Due to the shift to increasingly important wage work in the last two centuries (mainly at the expense of small independent business; see pp. 323–32), repertoires of action, collective forms of action and, of course, also organization developed in this direction. This relates to the emergence of the collective voice of the self-employed in parallel to that of wage workers. In this regard, we can distinguish between incidental collective action and permanent organizations like mutual benefit societies and trade unions.

Incidental collective action

In the preceding periods, we have encountered a few major forms of collective action, including strikes of groups of wage workers without the existence of a permanent organization (erroneously called ‘spontaneous’ strikes; I prefer the term ‘incidental’) and rebellions and other forms of resistance by, especially, enslaved people, as well as by artisans, shopkeepers or petty traders. These forms have not vanished, although some have lost importance. Let us first consider more closely the following forms of collective action outside of permanent organizations: sabotage; collective exit; charivari; petitions; consumer boycotts; and, above all, the strike.56 The choice for a specific form from this repertoire of action (or, as is often the case, a combination thereof) depended on, among other things, the attitude of the authorities. And with illegal actions, such as the destruction of personal property, or when strikes were declared illegal, secrecy was often paramount.⁵⁷ Pure wage workers were often more vulnerable than their self-employed counterparts who, for example, still had an extra form of income because they owned a piece of land.

Sabotage was already found in the early phase of the Industrial Revolution, when machine breaking swept England and France (see p. 302). But like the collective exit, it was much older than this (see, for example, p. 152 on the Zanj rebellion in the ninth century).⁵⁸ Indeed, in the 1840s, a combination of the two (and other tactics) was used by seasonal brick moulders employed on the Ganges Canal works, close to Roorkee in northern India, to prevent piece wage reductions of 12.5 per cent.⁵⁹ The more than a thousand moulders, united in production gangs, probably based on regional and caste bonds, initially tried collective exits. Clearly lacking an understanding of the deep roots of the conflict, one of the English executive engineers reported:

their combined and frequent efforts to evade the doing of a fair day’s work, or to extort from us a higher rate of pay [than the recently reduced one], caused much anxiety to all concerned in the manufacture of bricks. If an attempt was made to coerce a moulder, or even if fault was found with the quality or quantity of work performed by one or more of them, the whole would quit working collectively, taking their moulds in their hands, and walk to their huts, in spite of all remonstrance. I can well remember that they served us in this manner twice in one week at Roorkee.⁶⁰

In the next phase of the conflict, the new machinery, which threatened the monopoly of the moulders, was constantly being sabotaged and new attempts were made to reverse the pay cuts. When all this turned out to be to no avail, fires broke out among the thatched sheds of the public works department at Roorkee. The engineers had no doubt that this was arson but were unable to catch the perpetrators. One of them commented: ‘I am inclined to think that the cause which has led to this wanton destruction of property has been discontent of the moulders at the rate of wages which they at present receive . . . it is probable that the nearly general dissatisfaction found vent among the leaders of the malcontents by active participation in this outrage, which the remainder either approved or would take no active steps to prevent.’61 Interestingly, the moulders ultimately prevailed. In the end, the engineers who had wanted to reduce total production costs by up to 25 per cent were able to achieve a reduction of 16 per cent in the short term, but at the expense of ‘an infinite deal of trouble’, as one of them concluded. More importantly, in the long run, wage rates were not reduced, the brick machines were no longer active and, once again, bricks were made by hand.

Public humiliation of those who break community rules, called charivari or the ‘donkey ride’, is best known as a punishment for men who break their promise to marry a girl after getting her pregnant, marrying couples with an extreme age difference or for wife beaters, but it also occurred in labour conflicts. Both unpopular bosses and, especially, strike breakers were sometimes called to order in this way. Dishonoured persons were placed on a pole or paraded or ridden around the streets in a wheelbarrow, serenaded by discordant ‘rough music’.⁶²

Petitioning can be seen as a safety valve for those lacking formal rights in polities, but whose concerns nevertheless may be considered, if only to prevent worse. They are integral instruments of government in any non-democratic society, but may also have a longer life. Moreover, contention over innumerable work issues have been formulated in this way (as discussed in Chapter 5).⁶³

Consumer boycotts are generally a means to express dissatisfaction about prices or about political issues, such as the ban on imported Outspan oranges from South Africa during Apartheid.⁶⁴ The Outspan boycott was clearly linked to labour issues, as is the word ‘boycott’ itself. While the practice is much older, the word is derived from Captain Charles Cunningham Boycott from County Mayo, Ireland, who, in 1880, refused to receive rents fixed by his tenants and was subsequently confronted with their violent protests. An example of wage workers using this weapon comes from London’s East End. In order to improve hours and working conditions, bakers went on strike in 1904. Those employers who agreed to their wishes received a union label to put on their products, while the others were boycotted. The women who did the shopping played a crucial role: ‘A few days after the strike began, the smaller master bakers attached the union label to their product, as the Jewish women refused to buy any other. It was the custom of grocers to stock bread. Women would first buy their provisions, then ask for a loaf. The grocer was left with so much unsold bread that he immediately switched to a union-based supplier. It did not take long before the union’s demands were agreed by every master.’65

This was a successful action by unorganized consumers supporting a strike organized by a union. However, in contrast to the conventional view, strikes in the past and possibly also in the present have frequently not been initiated by trade unions.⁶⁶ We have already seen a number of examples in this section (but see also, for example, the strikes in the Ichapur gunpowder factury, pp. 219–20). Instead of multiplying those examples here, we will briefly discuss a few key dilemmas facing workers on strike. By stopping (or also slowing down) work and, consequently, inflicting damage on employers, workers try to force them to give in to their demands. Excluding non-economic demands like the boycotting of foreign goods for political reasons or the political system of a country, strikers may leave the workplace, may close it off for suppliers or customers or may occupy it without working, as in the sit-down or sit-in. They may do so for a (pre-announced) brief period of time (lightning strike) or, at least as an objective, indefinitely. They may attempt to shut down one establishment or all establishments of a business or sector simultaneously, or instigate a consecutive series of brief work stoppages at many firms (rolling strikes). The outcome is, of course, determined by the enduring power of the workers, now without wages, and that of the employers, now without income from their sales. The great number of strikes in history demonstrates that this outcome is uncertain. Although employers as individuals are many times wealthier than their workers, the latter – by means of solidarity, including savings (by way of collections or in the form of a strike fund) – are certainly not defenceless, provided that they maintain unity. This is perhaps the most difficult aspect, in particular when the employer manages to engage strike breakers, actively supported by the police force that has to protect them when facing picket lines.

The emergence and subsequent growth of central workplaces made the organization and eventual success of a strike much more feasible. Andrew Ure, the Scottish physicist and author of The Philosophy of Manufactures (1835), remarked that British proto-industrial textile workers were ‘scattered over a wide track of the country’ and that, because they were also ‘mutual competitors for work and wages’, they rarely managed to ‘conspire with one another, and never with effect against their employers’.67 As we will see below, he was soon to be proven wrong. From the second half of the nineteenth century, not only the concentration of workers but also the growing interconnectedness of national economies enhanced the phenomenon of transnational waves of conflict.⁶⁸ Thus, the years following the first and the second world wars are conspicuous, but for different parts of the world other strike waves are also visible in between, for example, during decolonization. As we have seen, these waves have had major implications for the position of the workers.

The patterns are fuzzy for recent decades. Against pessimism about the effectiveness of the strike weapon in the rich ‘core countries’, we find rising collective actions in eastern and southern China from the late 1990s.⁶⁹ Remarkably, these strikes of mainly young migratory workers of recent peasant background are, by definition, not organized by trade unions. The unions play only a mediating role between the striking workers, on the one hand, and the government as the dominant actor and the employers, on the other.

To give an example, in the summer of 2005, 20,000 workers went on strike in 18 enterprises in the Dalian Development Area in China.⁷⁰ Consequently, each of these factories, all Japanese except for one Korean firm, raised their salaries and abolished a number of practices, including the issuing of short-term contracts and speeding up assembly lines. This successful result for the strikers is not self-evident, however, given the fact that, in 1982, the Chinese government revoked the freedom to strike, previously included in the constitutions of 1975 and 1978. On the other hand, in 1990, China’s People’s Congress approved the 144 Convention of the ILO calling for ‘tripartite consultation’. In reality, this is very hard to practise in China, where the unions are entirely dependent on the government. Not surprisingly, the workers at Dalian averted the unions only a few hours before the beginning of the strike. In one company, ‘a note was slipped under the door of the union office in the morning, which declared the intention of the strike action that took place four hours later.’ In another company, union cadres ‘visited dormitories to persuade workers to stay away from the strike, only to find that all of the dormitories were empty; it turned out that a mobile phone message about the visit of the union cadre had been disseminated among the workers and that they had been asked to “disappear”’.⁷¹

Permanent organization

Guilds and guild-like organizations vanished from most countries from 1800 onwards, but only gradually, and even now they are not totally absent (think of closed national organizations of highly skilled professionals like medical doctors).72 Partially inspired by these old organizational forms (see pp. 232–5) and means of collective action, new types of organizations have emerged, in particular co-operatives, mutual benefit societies and trade unions. Their occurrence in specific countries at specific times greatly depends on the legal possibilities to start such organizations.

Mutual societies and co-operatives

Mutual aid is not a new, nineteenth-century phenomenon. In the preceding five centuries, craft guilds had already developed elaborate schemes of mutual help in order to cover the costs of a decent burial, sickness, old age or other mishaps of life. This tradition, which primarily concerned master craftsmen, was also emulated by journeymen’s guilds or similar organizations, in particular in those trades where there was little chance of workers becoming masters themselves after a few years.

In addition to the most common form of mutual aid, disbursements to members in need by way of mutual insurance or benefits could also be rotated.⁷³ So-called roscas (rotating savings and credit funds) functioned as illustrated in the following example of a cycle or sheet among Indian migrants on Mauritius around 1960:

A man or woman calls together a group of friends and neighbours. Suppose there are ten of them, and each puts in Rs. 10. They then draw lots and the winner takes the Rs. 100. (Sometimes the organizer automatically takes the first ‘pool’.) The following month each again puts in Rs. 10, and another member takes the resulting Rs. 100; and so it continues for ten months until each member has had his Rs. 100.⁷⁴

Another form of mutual aid is the distribution of benefits among a group as we saw in the case of ‘beer work parties’ (p. 327).

Most roscas, monetized or not, were based on trust and required minimal administration compared to mutual benefit societies or co-operatives. This, combined with neglect by trade unions, is also why these and similar organizations are popular among migrants. Mutual insurance requires a distant time horizon. Guilds with compulsory membership were well suited in this regard. Trade unions, too, although legally unable to compel workers to join, emulated this model with success – in the rich countries, until the welfare state took over most or all of these functions.75 To a lesser degree, corporate funds, set up by management, and commercial or doctors funds could become competitors. Mutual organizations in particular offer a useful alternative for private loans, which often left poor people without collateral dependent on creditors and, in extreme cases, in lifelong bondage.

Already documented for the Roman Empire and for the medieval and early-modern guilds, mutual benefit societies spread quickly with the expansion of wage labour. Based on a membership of workers in a city in the same trade, they frequently combined several functions. Apart from providing mutual insurance, these societies also enhanced sociability and communal respect, in particular by staging public funerals of their members, all of whom were obliged to attend in smart attire. On an economic level, such societies also functioned as consumer co-operatives. The step to a more active defence of interests by way of petitioning and occasional strikes was imminent, and many developed into trade unions – or, they offered an alternative to unions, as the latter were often forbidden. It is noteworthy that mutual benefit societies have hardly ever been banned, if only because they alleviated poor relief. In England, for example, mutual benefit societies were generally called ‘friendly societies’ and were recognized as early as 1793. Trade unions, by contrast, were still facing many impediments as late as 1867.

Producer co-operatives are democratic, profit-sharing organizations that give members a say in the management.⁷⁶ They emerged, briefly, in the mid-nineteenth century among craftsmen and, in a much more restricted way and therefore much more successfully, among peasants and farmers. In order to fight or avert unemployment or to abolish middlemen, craftsmen could produce communally rather than on their own private account. This was facilitated by the communal purchase of raw materials, tools or machinery and by communal sales of their products. Successful sales often proved the most difficult aspect of such producer co-operatives. Notwithstanding strong work ethics and the elimination of excessive profits, this form of cooperation, attempted many times, has not been very successful overall.

What has been a success, at least for small farmers in Western Europe, has been the common purchase of means of production and the ability to access cheap credit loans via a co-operative bank. Best known is the bank founded by the nineteenth-century German social reformer Friedrich Wilhelm Raiffeisen, who propagated self-help. His ideas were emulated over most of continental Europe and even beyond. The initial project to pool members’ savings in order to provide low-cost long-term loans then developed into the joint purchase of seed and fertilizers and of operating resources such as machinery to be used by co-op members, and the common storage and sale of harvest products at the most favourable moment and independent of merchants.

Trade unions

Whereas craft guilds defend the interests of those self-employed in a specific local trade and mutual benefit societies aim at reducing the personal risks of their members – not necessarily but often workers – trade unions typically unite workers who want to influence wage levels and working conditions. Despite these differences, the nascent trade unions worldwide in the eighteenth and nineteenth centuries borrowed many tactics, strategies and rituals from their predecessors, and the collective actions of all these entities ran parallel for a very long time. This is aptly called the ‘artisanal phase’ of the labour movement.77 Prior to the twentieth century, trade unions were more numerous than the aforementioned older organizations in only a very few countries in Western Europe.⁷⁸

The legal framework in which trade unions could function is discussed below (pp. 398–400). Here, it suffices to remember that they were permitted in most countries quite late in the nineteenth century. Indeed, before trade unions were empowered with full rights, there had been a greater chance that they would resort to illegal actions, including violence. Between the 1820s and the 1860s, the brickmakers’ organizations in and around Manchester tried to establish a closed-shop system in order to prevent employers from selling bricks outside the area and, in particular, below conventional rates. Their aim was to compel factory owners to employ union members and give them a fair piece rate for moulding and, if need be, advances as well as employment to dig clay in winter when moulding was impossible. Any employer not prepared to obey union rules could expect strikes and, if that failed to have an effect, also violence. Needles or broken glass were hidden in the moulding clay, green bricks were destroyed, workshops were burnt down or factory horses’ hamstrings cut with razor blades. As these words of the union man attest, sometimes matters took a turn for the worse: ‘After a master had infringed upon the rules of the society, a deputation was appointed to wait upon him, and after having been waited upon, if he still acted contrary to our rules, or refused to comply with our requests, a general meeting was called. We there discussed the case, and we decided that the only course left open to us was what would be called by persons not belonging to the union an unlawful course.’79 There are reports of subsequent personal assaults, attempted poisonings, nightly arson on adversaries’ houses, shootings, and even the murder of a police constable in 1862, which was followed by the trial and execution of one of those found guilty.

The further development of already existing journeymen’s organizations was one way to start a trade union, as it became clear to more and more journeymen that they would never attain the status of an independent master. That was certainly true for those that had already joined a factory. The fact that Lancashire mule spinners hired and trained their own assistants, as we have seen, meant that they controlled the supply of labour and could therefore unionize their trade effectively early on by making agreements with employers on detailed piece rate lists, short-hour working during trade slumps, seniority rules in case of lay-offs and, finally, conciliation arrangements.⁸⁰ But many early trade unions also united small independent craftsmen, such as the self-employed diamond workers that stood at the cradle of the socialist trade union movement in the Netherlands.⁸¹

Trade unions were able to expand following the repeal of restrictive legislation. Everywhere the foundation was a local or supralocal organization of workers in the same trade or branch. A first proliferation of trade unions and similar organizations took place in Western Europe in the decades before 1848. The revolutions that took place around that year – which were about much more than labour issues – mostly ended in disappointment and also in a lull in labour activity. Only after four decades did activities pick up again, now mainly under the banner of socialism.⁸² Successful attempts were also made in Western Europe at this time to form national federations, first trade-wise and subsequently uniting as many wage workers as possible across all economic sectors.

This was also the period when ideologies matured with respect to the nature of the labour–employer relationship. Two basic positions emerged. The first was taken up by the (mainly Christian) trade unionists, who believe that cooperation is the best way forward and that open conflict is only necessary in exceptional circumstances.83 The second position, meanwhile, was occupied by anarchists, syndicalists and socialists who regard employers and their workers as two distinctive ‘classes’ that, in principle, have antagonistic interests, and they thus believe that class struggle is necessary. Revolutionary syndicalists even propagate ‘class war’ to be waged through ongoing guerrilla warfare, while socialists, by organizing not only trade unions but also political parties, essentially want to rely on the state to achieve their goals. The extension of voting rights to workers and small independent producers enhanced the chances of those labour movements that were willing to exploit the political opportunity. By participating in and winning elections, they expected that, once in power, they would be able to change, in a democratic way, the rules governing the labour market; hence they called themselves social democrats. The communists, who split from the socialists in the early twentieth century, aimed to take over government by force, as they did for shorter (133 days in Hungary in 1919) or longer periods (more than 70 years in Russia, and even more in China, given the communists remain in power today).

These different interpretations of the nature of the clash of interests between employers and workers resulted not only in different organizations but also in fierce competition among them. Whereas in the early phase of trade unionism it would have been highly unlikely that workers in the same trade would organize along different ideological lines, this became the rule later on, especially nationally and internationally. Conversely, national organizations could force local ones to show their colours. Before the Second World War, anarchist and syndicalist trade unions played an important role, especially in southern Europe and Latin America. Ideological controversies and other rivalries contributed to a schism in trade unionism. In Mexico, a country with far-reaching labour rights since its 1910 revolution, workers’ organizations sprang up, with textile workers already counting 425 local unions affiliated to 8 different national federations in 1940.⁸⁴

As the Cold War evolved, the main competitors emerged as communist and socialist trade unions. Frequently, the latter’s tactics imitated those of Catholic and Protestant trade unions in the few countries where these played a significant role. This became possible as the social democrats exchanged the dogma of class struggle for that of the ‘social market economy’ (in Germany called the Rhineland model) following the Second World War.85 Thus, trade unions like the American Federation of Labour (AFL) also became increasingly apolitical.

The development and dissemination of trade unionism across the globe occurred through imitation, as had previously been the case with guilds, mutual benefit societies and the like. Migrants and, especially, sailors played an important role in this regard. This is obvious in the case of white settler colonies, but it also happened in tropical colonies, not only as a result of workers imitating their counterparts elsewhere, but also top down. This could be in the form of the missionary zeal of communist, socialist, Christian, national, international and supranational organizations (like the socialist and communist internationals discussed below), but also of religiously inspired movements; think of the Catholic Church and the papal encyclical Quadragesimo Anno (1931) and its predecessor.

Trade unions utilize various strategies and apply many tactics to achieve their goals, but at the centre is the collective bargaining of wages and work conditions, aimed at collective labour agreements. This requires considerable diplomacy, but in the knowledge that they have recourse to the ultimate bargaining lever – the threat of strike. If applied, this threat is the ultimate test of the union’s ability to impose its will on the employer or employers, but notably also to control its workers. When a union is able to force the employer to make union membership a condition of employment, we speak of a ‘closed shop’.⁸⁶ In fact, this is the same procedure that was followed by the craft guilds. Indeed, the closed shop was particularly popular and successful among the skilled crafts in nineteenth-century Europe and, more recently, in England.

The unification of workers, of course, provoked the unification of their counterparts, employers. Conventionally competitors, under the pressure of collective action and a united workforce they now attempted collective bargaining as a strategy and, in addition, put pressure on local or national governments to choose a side. Broadly speaking, for a long time, politicians and employers belonged to the same social class, with the latter having a much bigger chance of enforcing their conditions than their workers. Among their strategies was the organization of factory- or firm-based trade unions, meant to compete with unions controlled by the workers independently.

These employer-organized unions are called yellow unions. Even more extreme was the imposition of yellow-dog contracts, particularly widespread in the US in the interwar years before new arrangements under the New Deal saw the blossoming of trade unions in subsequent decades. The polar opposite of closed shop arrangements, the yellow-dog contract is ‘a promise, made by workers as a condition of employment, not to belong to a union during the period of employment, or not to engage in certain specified activities, such as collective bargaining or striking, without which the formal right to belong to a union is wholly valueless’.87 In post-war Japan and Korea, too, fierce battles between trade unions and employers who established competing top-down unions are not uncommon. Several trade unionists in the Korean shipbuilding industry even committed suicide in a final attempt to save their independent unions and to win disputes. One of them, employed at the Hanjin Heavy Industries wharf at Busan, occupied his crane, No. 85, 35 metres above the ground, from 11 June until 17 October 2003. In his suicide note he wrote:

Managers seem to want blood with their naked swords. Yes! I will offer myself up as a sacrifice if you want. But we badly need to get a result from this struggle. . . . Using claims for damages, provisional seizure, criminal charges, imprisonment, and dismissal, managers seek to change our union into a ‘vegetable union’, and workers into ‘human vegetables’. If we could not transform this labor control policy through our present struggle, all of us would only fall over the cliff. So, whatever may happen, we must continue to struggle until we win. I am only thankful and at the same time sorry to comrades who have been with me and believed in me.⁸⁸

Cooperation between local trade unions dealing with one or several local factory owners developed into national federations, whose main aim was collective bargaining on a national scale, at least where wage levels did not differ too much regionally.⁸⁹ This way, terms of work and pay for specific groups of workers were excluded from competition. The next step was ‘social ownership’ at the firm level: economic power sharing and employee involvement in business decision making and strategy setting, exemplary in Scandinavia and Germany during the flourishing of the welfare state.⁹⁰

The outcome of all these negotiations over the last two centuries is a much better position for wage labourers in countries where unions have developed most and have met with success than in countries where they have not materialized for various reasons. The same can be said about different sectors within countries, the clearest example being India. There, trade unions and collective bargaining are restricted to the ‘formal sector’, covering only 7–8 per cent of all wage workers. Wages, and especially social security, are much higher in this sector than they are in the ‘informal’ or ‘unorganized’ sector.91

Not by chance, the global waves of strikes after the two world wars more or less coincided with the success of unionization and union density. This has never been higher than it was in the 1950s and 1960s, although this success would not last long. Without doubt, union membership and union density have been decreasing worldwide over the last half-century. There are many reasons for this. The main ones are (in different order for different parts of the world and for different economic sectors and branches of industry): changing political structures and globalization; professionalization of trade union functionaries leading to alienation from rank-and-file members; discontinuities of firms and, consequently, the loss of unionists’ expertise and traditions; and the increasing heterogeneity and casualization of the workforce intrinsic to the shift from industry to services in the rich countries⁹² (for more detail, see p. 423 below).

The unavoidable result of organizational success was the professionalization of full-time paid union leaders and their staff and, as a consequence, more anonymous internal relations. Collective bargaining in particular could result in internal conflict between functionaries and the rank and file. After all, negotiators on both the employers’ and the unions’ side must be firmly in control of their members to ensure that they adhere to the contract for the agreed period. Dissatisfaction with professional trade unionists may induce the rank and file to so-called ‘wildcat strikes’ in order to reach better terms of contract.⁹³

One simple reason for the demise of trade unions in the rich countries is the closing-down of factories and mines and their subsequent shift to low-wage countries elsewhere. Between 1969 and 1976, 22.3 million jobs were lost in the US with the closure of some one hundred thousand manufacturing plants.⁹⁴ Bruce Springsteen sang about deep frustrations in the US, for example about the closing of a textile mill in My Hometown in 1984; similarly, Ewan MacColl lamented the coal miners’ situation in England in Miner’s Wife in 1960. These concerns remain crucial to North Atlantic politics today.

Of course, new jobs are constantly being created, but the point here is that the old plants were heavily unionized and that the generations-old experience of collective action was lost – lost in desperate defensive actions such as the year-long strike by Arthur Scargill’s National Union of Miners against the closure of the English coal pits. And in other countries, the learning process taking place in new plants in terms of dealing with the power relations between wage workers and management had to be started almost from scratch. Moreover, the outsourcing of tasks to subcontractors diminishes the long careers of wage workers during which they can garner trade union experience.

Another reason for de-unionization is the growing heterogeneity of the workforce in these countries from the 1960s onwards.95 In the US, for example, women, immigrants and African Americans in particular entered realms thus far dominated by autochthonous white males.⁹⁶ Their trade unions, always alert to preventing wage cuts, were traditionally suspicious of these groups, who, they believed, were supposed to be satisfied with inferior working conditions. This was exacerbated by the propensity of employers to use immigrants as strike breakers in the pre-war years. This inclination towards the exclusion of newcomers perceived as culturally alien also weakened the unions. The unions’ upholding of seniority rules for lay-off benefits favoured their long-time members, but at the same time alienated youngsters and other outsiders.

This is not to say that the inclusion and active participation of migrants, ethnic minorities or women is easy for traditional trade unions. The Austrian social democrat Adolf Braun made the following observations in 1914:

While male workers start and finish working and take their breaks at set times, the hours of work of female workers are very frequently, one might even say as a rule, unlimited. When women come home from the plant with its set working hours, they find manyfold tasks awaiting them, often for people they must care for in addition to themselves, with respect to cleaning, clothing, cooking, and often not for themselves alone but for others as well, not only for their husbands and children but also for subtenants, lodgers and the like. . . . Arriving home late, the road home from the meeting, across long distances at night, often through poorly lit areas, presents no problem for male workers but does for female ones. This is why often even female workers recruited as members of the industrial organizations have greater difficulty becoming fully involved than their male counterparts.⁹⁷

Of course, in addition to these structural reasons, the political framework also matters. There are huge differences between countries when it comes to unionization, depending on the nature of the parties in power and their cooperation with employers’ and workers’ organizations. The presence of leftist politicians in government, union involvement in unemployment benefits and the size of the labour force in unionizable industries explains these variations. Around 1980, union density was highest in Sweden, Denmark and Finland (80 per cent or more). In Iceland, Belgium, Ireland, Norway, Austria and Australia it was between 50 and 79 per cent, and only 20–49 per cent in the UK, Canada, Italy, Switzerland, West Germany, the Netherlands and Japan, with the lowest rates, below 20 per cent, in the US and France.98 Occasionally, more peculiar circumstances can explain national differences. In France, for example, membership fluctuates heavily as workers can easily drop out between strike waves and join again as conflict surges.

These figures also reveal how state policies directly influence the longevity of trade unions.⁹⁹ Where welfare states delegate crucial executive functions to trade unions (especially with respect to unemployment benefits), such as in Scandinavia, membership is automatically high. Where this is not the case, as in most other Western European countries, figures are much lower. In particular, the general binding agreement of collective labour agreements disincentivizes joining a union. This is the case in the Netherlands, for example, where free riders and loyal, subscription-paying members alike profit equally from attractive offers from trade unions. In recent decades, as we will see, the proliferation of subcontracting, temping agencies and payroll constructions have made the work of trade unions much more difficult than it was in the classical factories that dominated the landscape from, say, 1850 to 1980.

Where this is compounded by the state frustrating or suppressing trade unions, membership is even lower. Trade unions in the sense of independent organizations have been and are still forbidden in dictatorial regimes. Or they are entirely subsumed by the state, in a corporatist way (compulsory cooperation of employers and workers under the guidance of the state), as witnessed in Fascist Italy and National-Socialist Germany, or in a communist way as in Stalinist Russia. More recently, military regimes in Latin American, European and Arabic countries have abolished trade unions, put their leaders and active members in prison or set up rival organizations under strict state control. Under new centralist leadership, these mock-unions (also called ‘yellow unions’) certainly have a cultural role to play, but they cannot perform their essential independent function of co-determining labour relations.¹⁰⁰

In addition to the many structural factors at play in other countries, the low figures for union membership in the US are a direct result of racial segregation and various waves of checking, counteracting and suppression.101 Trade unionism started early in the US, boosted by experienced immigrants and, in the late nineteenth century, the successful Knights of Labor (founded in 1869, it propagated co-operatives among farmers, shopkeepers and labourers). Employers, often hand in glove with civil authorities, adopted serious counter-measures, including legal action, espionage, violence and terror. Perhaps the most infamous example is the 1892 strike at Carnegie’s steel plant at Homestead, managed by Henry Clay Frick, who invoked the assistance of 300 armed security men of Pinkerton’s National Detective Agency and, after their defeat, a further 8,000 men from the Pennsylvania militia. They were to stay for 95 days and, with the help of strike breakers, ensure Frick’s victory. There are many more instances of worker militancy, in particular in the period from the First World War until the 1930s, when trade union rights were confirmed and extended by the Wagner Act (1935). Many of these achievements would be restricted by the Taft-Hartley Act of 1947, followed by McCarthyism. What had once been a powerful movement was thus reduced to mainly shop-floor action by skilled workers.

This is not the place to repeat the history of trade union internationalism, with the exception of one particular aspect: its influence on labour legislation and therefore labour conditions transnationally and even globally. Many attempts at such cooperation have been made, but the most successful is undoubtedly the International Labour Organization (ILO), founded in 1919.¹⁰² It builds on long traditions of transnational and international cooperation between workers. It began with journeymen’s organizations linking towns, like the French compagnonnages or German Wanderburschen. In the nineteenth century, other organizational forms emerged, again among migratory workers crossing borders, like sailors (for both, see pp. 237–40). Such cooperation aimed at preventing the importation of strike breakers from other countries (as successfully achieved between Spanish Galicia and northern Portugal between 1901 and 1904) and at reducing competition between workers in the same industries in different countries. This may be rather defensive, but these contacts also enabled them to learn from each other, at least where workers in different countries worked for the same multinationals. For example, in the 1990s, the International Metalworkers’ Federation (IMF) maintained files on more than 500 of such companies.¹⁰³

The various ‘Internationals’ may be famous, but their effectiveness varies immensely, from boosting the morale of participants to organized revolution. Preceded by some earlier initiatives, like the London-based Democratic Friends of All Nations (1844–48/53), the First International (the International Working Men’s Association, 1864–76) was still small. The Second International (1889–1916) had many more members in different parts of the world, and also lasted much longer. But it was also deeply divided on many issues: not only ideologically (socialists versus anarchists) but also on practical matters, as became clear when it discussed international labour migration during its 1904 and 1907 congresses. Notwithstanding the high ideal of international solidarity, the successful trade unions and labour parties in white settler colonies squarely opposed free immigration of ‘non-whites’. More generally, racist attitudes vis-à-vis colonial populations were widespread in the labour movement until far into the twentieth century, even after the movement had advocated decolonization.104 But solidarity between labour organizations in different European countries also appeared much more superficial in that fateful summer of 1914 than previously anticipated.

Trade unions and political parties worked together in these ‘Internationals’, but in 1903 a separate Secretariat of National Trade Union Confederations was established by mainly North Atlantic socialist trade unionists. In 1913, it was renamed the International Federation of Trade Unions (IFTU) and in 1949 it was succeeded by the International Confederation of Free Trade Unions (ICFTU). They were rivalled by similar syndicalist, Christian and communist federations of national trade unions.

All these international organizations, whether uniting trade unions from a particular sector or all types of member organizations sharing the same ideology, sought to influence public opinion, and a number also appealed directly to governments. The League of Nations (and later its successor, the United Nations), founded after the First World War, became the natural focus point of such attempts. The ILO came into being in 1919 as part of the Versailles Treaty, which declared that ‘peace can be founded only on social justice’. Helpfully, key politicians had been convinced by the usefulness of the international trade union movement in their bid to sidestep ‘the long shadow of Russia’.¹⁰⁵ In its turn, only a month after its foundation, the ILO used its Washington Convention to attempt to convince member states, by diplomatic means (unlike trade unions, the ILO cannot use strikes as a lever), to adopt legislation regarding labour standards, such as the maintenance of the 8-hour day and the 48-hour week for industry.¹⁰⁶ Its major achievements include measures against slave labour and the slave trade.

Work and the state

Influenced by major shifts in labour relations and in the strategies of those involved – both individually and collectively, both ‘spontaneous’ and via more permanent organizations – the character of society has changed radically in the past two centuries. More and more rules were needed as work shifted from primarily the household to the public sphere. And those laws and regulations relating to work had to be constantly adjusted.107 National states became dominant at the expense of local authorities. And, ultimately, they also moved to international and supranational agreements (consider the abolitionist movements against the slave trade and slavery). Partly due to the emergence of national schools of law and partly due to democratization, large differences in laws and regulations arose in practice, as a result of which it is often difficult to see the wood for the trees.

Two traditions stand out among this enormous variety: the Anglo-Saxon one and the continental European one. A distinction is made in the Anglo-Saxon tradition between still-relevant labour regulations based on statute law dating back to 1349 in England, determined by the government and popular representation, and the much more important common law, determined by judges on the basis of jurisprudence, which goes back to the late sixteenth century.¹⁰⁸ On the European continent, following the French Revolution, national and systematically codified law replaced previous local regulations and its courts for those laws (enshrined in a constitution and, in addition, in separate codes, such as a civil code, a criminal code, a code de commerce, a code de travail, a code de justice militaire, and so on). English colonies initially followed the mother country on this point, but later, a number, such as the US and certainly Australia, increasingly combined this with the continental European model of codified law. How all of this is arranged of course matters greatly to self-employed litigants, wage labourers (individually and collectively), employers and their respective legal advisors (large unions, for example, have legal departments).

Nevertheless, during the last two centuries, we may discern a great wave in the North Atlantic and its offshoots, and in the last half-century also increasingly beyond – from regulation and corporation (households, estates, guilds and so on) in the ancien régime, to deregulation and decorporation in the first half of the nineteenth century, to reregulation and recorporation in the century thereafter and, finally, to another period of deregulation and decorporation since the end of the twentieth century.¹⁰⁹ Prepared by the banking crisis of 2008, the pendulum may now be swinging in the opposite direction, influenced by the coronavirus pandemic, although it is unclear for how long.

Incidentally, the development of decorporation warrants an observation with respect to households, where we do not find any recorporation from the late nineteenth century. As a nuclear work unit, the household eventually and definitively lost power. How did all this play out for labour within the household, for the self-employed and for wage labourers? This last group, increasingly more important than the first two, as argued in Chapter 6, will receive by far the most attention. Since we have already briefly discussed the legislation regarding unfree labour, we can bypass it here.

Labour relations that, initially, were primarily arranged within the household, that is to say the relationships between the head of the household, (usually) his partner and other adults and children – but also slaves, if present – now increasingly had to be cast in public laws and regulations. This is particularly evident in the discussions about child labour: can the state take over care duties and thereby the legal authority of the father (and, via him, of the mother) in the household? That was certainly not self-evident in the nineteenth century. In the course of a debate about protective legislation with respect to child labour in 1877–78, a Belgian MP resolutely opposed this with the following argumentation:

a worker is also a father . . . There is no doubt that the state, in the public interest, can regulate certain professions, such as, for instance, the art of healing, or the art of producing medicines; the state can protect birds that eat insects to ensure that they are not killed, and domestic animals so that they are not mistreated. But there is one being which the state cannot touch without touching ourselves, and that is the being that is united with us through all the fibres of our souls, that is, our child.¹¹⁰

By the turn of the century, however, this debate was certainly in favour of protective legislation. But the curtailment of a husband’s authority over his wife, her labour and her earnings would take almost another century.

Meanwhile, less controversial was the view that education could help an individual, as well as the national economy as a whole.¹¹¹ This is evident from the increased labour productivity due to the success of primary education in the US in the nineteenth century. Of course, we should not underestimate the effect of the immigration of a young and aspirational cohort from the Old Continent, but it took until around 1900 for the UK and, later, also France and Germany to level up. It took France and Germany until the 1960s to surpass the UK due to the devastation of two world wars. By the 1980s, they had caught up with labour productivity in the US, leaving the country of General Motors, Ford and Chrysler trailing.

The explanation for these developments is education. The US, which by around 1945 had been close to achieving universal secondary education and, subsequently, had made great progress in the extension of higher education, was outflanked by Japan’s general education levels, due to the US’s privatization of quality universities with consequently higher thresholds. In contrast to the moderate diversity in primary and secondary education in the US – and to a lesser degree also in the UK – there is a deep gulf between well-endowed private and less well-endowed public tertiary education since the 1980s and 1990s.

Due to Japan’s national and widely available education system, with its emphasis on general skills, the country was able to develop an alternative to the American managerial model. Instead, Japanese firms could and were willing to rely on their shopfloor workers’ capacities to detect and immediately correct problems on the production floor. Whereas, according to the Canadian economist William Lazonick, American managers tended to see the independent judgements of skilled shopfloor workers as a threat, their Japanese counterparts were only too glad to rely on them. This largely explains – together with extremely low immigration figures – the phenomenon of the Japanese ‘salary man’: regular workers with lifetime employment and totally devoted to their firm in successful export industries. Japanese labour law accommodated this model. We must add a caveat here, however. Like the exclusion of women and children from the success of the adult male English textile workers in the nineteenth century, Japanese women largely functioned as a ‘secondary labour force’.112

Since governments had attained centuries of experience of regulating commercial practices, much less changed for the self-employed in these centuries. With the gradual abolition of guild monopolies in some countries and the sudden elimination of them in others, the equal freedom for all individuals to contract and compete in the marketplace appeared to have been achieved, but it has not been that simple. Think, for example, of the small farmers who often missed out in the distribution of the commons. But also with regard to, in particular, the leasing of land, the renting of business premises and the prevention of usury in moneylending, there was still much to be organized.113

We will not delve further into this here, but instead concentrate again on the category for which the most has changed: wage workers. Historically, we can distinguish three phases: to begin with, the breakdown of the corporative order in favour of the purest possible market operation around 1800, whereby the labour contract became sacred; then, during the nineteenth century, attempts by workers to make this functioning of the labour contract more equitable, to acquire the right to associate and meet and, ultimately, the right to strike (see p. 404); and, finally, the phase in which the state began to play an increasingly active role, alongside employers and employees, especially in the twentieth century in the form of the welfare state, including its partial degradation since the end of the same century.

Market instead of corporatism

The French Revolution, which had proclaimed the liberty and equality of each individual adult male citizen, sought to liberate that person from all impediments imposed by estates and corporations.¹¹⁴ According to d’Allarde, the rapporteur for the deliberations leading to the abolishment of guilds in March 1791: ‘The ability to work is one of the first rights of man. This right is his property and it is without doubt . . . the first and most sacred property which cannot be invalidated by prescriptions.’ When, however, immediately afterwards, printers, carpenters and farriers collectively resisted salary reductions by using their new political freedom of assembly and association, Le Chapelier (d’Allarde’s fellow MP), while acknowledging the need for higher salaries to guarantee true freedom, radically advocated the prohibition of all coalitions, both of workers but also of employers: ‘[those] formed by workers to raise the price of their working day and the ones formed by entrepreneurs to decrease [such rates]’. He explains his paradoxical opinion as follows:

While all citizens should certainly have the right to assemble, citizens practising certain professions should not be allowed to gather for their purported common interests. The state is no longer a corporation, only the private interest of each individual and the general interest remain. No longer may anybody campaign for intermediary causes or use the corporate spirit to alienate the citizens from the state . . . We must restore the principle of free agreements about each labourer’s working day between individuals; each worker is then responsible for fulfilling his agreement with his employer.115

Although not based on the principles of the French Revolution, the Anglo-Saxon tradition in the nineteenth century also tried to reduce the employer–employee relationship to the bare principles of a contract related to the offer and payment of services for a limited period of time between two individuals; specifically, ‘men of full age and competent understanding . . . contracting . . . freely and voluntarily’, in the words of the British judge Sir George Jessel in 1875.¹¹⁶ Three decades later, an American Supreme Court judge, Justice Peckham, formulated the same principles in a similar way in his verdict on the question of whether the state of New York had exceeded its constitutional powers by imposing a maximum number of working hours for bakers. According to him, state interference had to be strictly limited to ‘safety, health, morals and general welfare of the public’. However:

Clean and wholesome bread does not depend upon whether the baker works but ten hours a day or only sixty hours a week. . . . In our judgement it is not possible in fact to discover the connection between the number of hours a baker may work in the bakery and the healthful quality of the bread made by the workman. . . . There is no contention that bakers as a class are not equal in intelligence and capacity to men in other trades or manual occupations, or that they are not able to assert their rights and care for themselves without the protecting arm of the State, interfering with their independence of judgement and of action. They are in no sense wards of the State.¹¹⁷

Striving for fair market conditions

In reality, wage earners and employers were not equal at all, not least for strictly formal reasons – and least of all in the Anglo-Saxon tradition, for a very long time. In England, until 1867, workers (but not employers!) still had to face criminal punishment for breach of contract, which was a serious impediment to collective action by trade unions, as exemplified by the great strike of 1844 in the northern English coal fields:

The agents of Radcliffe Colliery [in Northumberland], by false pretenses brought thirty-two Cornish miners to supplant the old pitmen, and engaged them for twelve months at 4 sh. per day. . . . After the second fortnight the viewer offered these men 4 d. per tub, and they all, with the exception of four, absconded. . . . A reward of £50 was offered for the apprehension of the runaway Cornish men. The Newcastle police captured four of them, brought them to the Amble in gigs, together with a posse of police. The poor fellows were kept from the Monday night till . . . on the Tuesday night they [successfully] attempted to make their escape. . . . The others who absconded were arrested by the North Shields police force, and a steam-boat, carrying the police force and the special constables, was sent to bring them to Alnmouth, and thence to Alnwick, to answer for their conduct before the magistrates.118

Despite this impediment, textile unions in the industrial heart of Britain had managed to come up with peculiar arrangements with employers, as if combination laws were non-existent for them.

In contrast, the French Code Civil (Article 1781) did not include any penal sanction on the breach of contract, but, at the same time, the word of the employer should be accepted as the truth and the worker was not allowed to call witnesses in any court hearing.¹¹⁹ In another respect, too, French (and in emulation many continental) workers enjoyed more freedom than their brethren across the Channel. There, debtors of small means were severely prosecuted, put in special debtors’ prisons, or banished to North America or later to Australia (see p. 321).¹²⁰ In France and many continental countries, by contrast, debt was defined as a commercial problem, not as a criminal offence. The livret ouvrier (abbreviated to livret), an obligatory personal work pass, introduced in 1749 under the ancien régime, listed references from successive employers. It was given a new function when reintroduced in 1803 (this law would be repealed in 1890). On the one hand, mayors now became responsible for delivering and registering the livrets, and workers found without this document were to be arrested and sentenced as vagrants. On the other, ‘[w]hereas the old common law would allow the employer to retain a worker who was in debt by exerting economic pressure [the livrets now] allowed debts to be circulated from employer to employer. . . . That meant that the new employer became responsible for reimbursing the previous employer by deduction from the worker’s future wages up to a limit of one eighth.’ And the system worked pretty well, as evidenced by the successful mediations of the industrial tribunals (conseils de prud’hommes).121

In spite of the success of arbitration and conciliation in France in the first half of the nineteenth century, the bare market system, even without the unfairness of the Anglo-Saxon penal sanction for breach of contract, proved to be untenable. According to the German dictionary, edited by the famous linguists Jacob and Wilhelm Grimm, Gewerbefreiheit (freedom of trade) must end where Gewerbefrechheit (impudence of trade) begins.¹²² And it was exactly this sensitivity for Gewerbefrechheit that would grow after the mid-nineteenth century, when the hopes for arbitration and conciliation as a panacea were waning, in particular in Britain. Think of the role of artisans and workers in Chartism in Britain and in the 1848 revolutions in France and Germany. The focal point became the workers’ right to form associations in order to improve their own bargaining power by collective industrial action, including the strike weapon.

From the second half of the nineteenth century, workers in more and more countries gradually gained the legal right to unite into trade unions. Previously, this had only been legally possible in a few countries, for example in the UK, albeit with severe restrictions on action.¹²³ Although the Combination Acts of 1799–1800 propagated mediation and arbitration and made industrial action an offence, workmen nevertheless were allowed to associate peacefully to improve wages and conditions of work. In 1825, these organizational restrictions were repealed, but until 1867 workers still faced criminal punishment for breach of contract, which was a serious impediment to collective action by trade unions. In France, the compagnonnage and, during the 1860s, many trade unions were tolerated, but the latter were only legalized in 1884.¹²⁴ Many other European countries emulated these principles. It took most of the nineteenth century to ensure the legal right everywhere to set up a trade union that was allowed to wage collective action, and to abolish frustrating legislation along English or French lines.

Trade union rights were not unanimously declared by all countries, as they eventually were in Britain, France and most other European nations. The US, for example, offers a very messy history of tensions between a constitutional right to organize and continuous hostile court rulings of the kind pronounced by Justice Peckham. Even the federal National Labor Relations Act (NLRA, also called the Wagner Act), based in the First and Thirteenth Amendments of the American Constitution and enacted by President Roosevelt in 1935, has not put an end to this.125 It will come as no surprise that the Europeans afforded their subjects in the colonies such rights much later than at home.¹²⁶ In many other countries of varying political shades, including communist countries, trade unions have been forbidden or totally subsumed in order to render them powerless.

Growing state concerns about the labour market

From the second half of the nineteenth century, the national state became an increasingly important player in this process of reregulation and recorporation. It also became an independent actor in terms of being a legislator and enforcer. In fact, it had long been so in its role as employer, especially of soldiers, sailors and civil servants, and the significance of this role increased with the nationalization of companies and especially with the abolition of private ownership of the means of production in communist countries. In the welfare states, the sharp increase in tax revenues was also partly used to facilitate numerous civil servants carrying out these new tasks.¹²⁷ This new role, essentially meant to counter assumed equality in the labour market, could have various and overlapping political backgrounds: from defensive conservatism (think of Bismarck in Germany, but also of papal initiatives) via social-democratic consensus, to radical attempts at making workers’ rights dominant.

In terms of the forms and domains, we find state interference by way of the continuation and expansion of the conciliation or arbitration that we have seen before – voluntarily in the US and the UK and compulsorily in Canada, Australia and New Zealand, for example.¹²⁸ A second domain concerns the protection of those not considered capable of defending their own interests – first children and women, and only later all industrial workers – as seen in a plethora of factory acts and concomitant state-run inspectorates. In this field, we can speak of an international movement in which best practices (of course defined along political convictions) were tried out and emulated, famous examples being the Factory Act of Japan (1911) and the Labour Union Law of China (1924).¹²⁹ Crucial here is which workers are included and which are not, as exemplified by the Indian case, where the vast majority of wage earners, defined as belonging to the ‘informal sector’, are not protected at all by the state.

In addition, we also see in the twentieth century that the national state took over the traditional role of local authorities to directly promote the well-being of its inhabitants, and especially of the wage recipients within it, and increasingly to determine the lives of working people through national labour legislation. This went much further than income policy through differentiated taxation, combined with poor relief.

What were the attempted solutions in the welfare states? If only to offer an alternative for socialism, considered as extremely dangerous, all industrializing countries attempted some form of regulation of safety and working hours in the factories. Equally important was state interference in insurance matters. As we have seen, in case of conflicts, mediation, sometimes by special courts, was also offered. A next step was state interference in labour market intermediation, the setting of minimum wages and, finally, unemployment provisions, apart from poor relief.130

In the following, I focus in particular on some important forms of workers’ insurance, and especially those against work accidents, sickness and unemployment before the First World War. The two main varieties of workers’ insurance, emulated in one way or another worldwide, developed in Britain and Germany.¹³¹

Insurance schemes against accidents, sickness and unemployment: Two models

In Britain, for a long time, the state’s basic response was the enhancement of ‘self-help’, especially in the form of mutual insurance against temporary incapacity to work due to sickness and accidents, organized by Friendly Societies, mostly established independently of the masters. The state attempted to improve the quality of the services of these societies by requiring their registration. In contrast, the Prussian states and, from 1871, the Reich also relied on self-help, but by turning it into a compulsory, contributory, state-controlled insurance. They did so because, while (much later than England) introducing Gewerbefreiheit (breaking guild monopolies and thus allowing free immigration into towns), they felt compelled to take over part of their social security provisions. Firstly, and more generally, the new 1842 Prussian poor legislation applied to all resident Prussian citizens employed on a regular basis, including servants, journeymen and craftsmen. Secondly, and more specifically, the Prussian Gewerbeordnung of 1845 authorized local authorities to reimpose the requirement to belong to local trade-specific journeymen funds. Additionally, when Prussia abolished its monopoly over mining between 1854 and 1865, it maintained compulsory membership of the Knappschaften, invalidity insurance financed by mine owners and workers alike, dating from the sixteenth century. Such legislation formed a precedent for further compulsory insurance under state direction. Leaving aside – however interesting – a comparison between British and German approaches to insurance against accidents and sickness,132 we will concentrate here on insurance against unemployment.

Unemployment provisions and job mediation

Insurance against unemployment, at least for a limited period of time, is one of the oldest but also most difficult aspects of the provisions of guilds and mutual benefit societies.¹³³ It is difficult because in organizations with members from one and the same trade, all of them could be affected simultaneously, but in more mixed organizations, too, a downturn of the trade cycle would leave any system struggling with near-insurmountable difficulties. Hence such provisions, where they existed, always included many restrictions. Most of the time, provisions only took effect after a certain period and were only in place for a short time. The alternative was poor relief, but mostly in return for participation of the temporarily (and therefore ‘respectable’) unemployed in works that were considered to be useful, in particular public works. In the words of the British minister Joseph Chamberlain in 1886: ‘By offering reasonable work at low wages we may secure the power of being very strict with the loafer and the confirmed pauper.’¹³⁴ On a local scale, the public works solution encountered many obstacles.

Once again, we detect important differences when comparing the national social policies of Germany and Britain in the late nineteenth century. In Germany, unemployment insurance existed in only a few towns, whereas in Britain the National Insurance Act of 1911 included compulsory insurance against unemployment. Once more, the question arises: why were there such big differences in two modern and successfully industrializing countries?

The British solution of 1911 entailed compulsory weekly payments by the regularly employed (workers 38 per cent, employers 38 per cent and government 24 per cent) in unemployment-prone sectors, mainly building and construction. Disbursements only kicked in after one week and for a maximum of fifteen weeks per year. Unemployment caused by a strike was excluded. On the other hand, the state subsidized voluntary unemployment insurance by trade unions. After the First World War, long-term mass employment resulted in this being extended to all sectors in 1921, and to the conversion of a flat-rate benefit into one including dependents’ allowances.

In Germany, as in many continental European countries, the so-called Ghent system prevailed – that is to say, the provision of only local subsidies to local trade unions. Unions accepting such subsidies had to strictly separate their unemployment funds from their general means, which could be used to compensate members for loss of income during a strike. Here, the tradition of the local labour exchange was much older than in Britain. Between 1869 and 1900, they were free of government control, but subsequently they had to operate under a licence in order to foster transparency. As an increasing number of trade unions included unemployment benefits in their package, they also tried to occupy part of the job mediation market. In 1903, non-profit mediation accounted for 30 per cent of such mediations. Private employer-controlled job mediation, of course, offered plenty of opportunities for the blacklisting of labour activists and other critical workers.

By 1904–05, Germany counted 216 public labour exchanges against only 21 in England. Their success in Germany was partly due to the trade unions’ adoption of unemployment insurance, from 1911 subsidized according to the Ghent system. It was executed by local governments who partially drew from charitable contributions, but increasingly from public means. This contribution increased benefits by 50 per cent for a defined maximum number of days. The establishment of labour exchanges, managed equally by members from employers’ and workers’ organizations, enabled the participants to judge whether unemployment was genuinely voluntary. The composition of the management in fact favoured more skilled labourers because their unions could run unemployment insurance funds much more successfully. For the same reason, this helped them to unite workers in a particular branch. Politically, the acceptance of the Ghent system in German towns signals a fundamental change in German welfare policy and the acceptance of trade unions ‘as legitimate actors in the regulation of social problems’.135

Nevertheless, it concerned only a minority of the German towns and urban workforce because it presupposed the power of the socialists, the trade unions and their supporters to convince a town government that subsidizing workers’ unemployment funds was a good idea. In Belgium, this was the case in Ghent, but in most German towns political majorities were not in favour of workers’ organizations. Hence the British solution was more successful because ‘organized labour was effectively integrated as part of the British political system’.136 That was not the case in Germany, where a far smaller proportion of the labour force was unionized than in Britain.

The emergence of welfare states

All measures and legislation discussed so far may be seen, at best, as institutions to improve or even optimize the functioning of the market and, at worst, as stopgaps for an essentially unjust system. Those who adhered to the latter interpretation have tried to eliminate the market or most of it by getting rid of (big) employers. In communist states, however, sickness, old age and other lifecycle problems are present as well, and there, too, insurance has been accepted as the best solution, although not voluntarily or compulsorily paid for by the workers themselves but rather financed by general taxation.

Other states had been preparing in a practical way for the exigencies of the welfare state long before the concept even came into being. They did so by employing more and more wage workers directly. Before the introduction of military conscription, many states acquired the necessary managerial skills by maintaining professional armies. The execution of military conscription also asked for plenty of bureaucratic and managerial skills. The expanding tasks of the national state in the nineteenth and twentieth centuries – including staff for the colonies – also reflected this.

The social legislation reviewed above was the result not only of collective action but also of individual voting behaviour.¹³⁷ With the expansion of suffrage and voting rights to large parts of the population, not only was the state forced to intervene increasingly and more intricately in the work of its citizens-no-longer-subjects; states also cherished the pretension that it was best to provide good working conditions and a good income, and they promised their citizens the best of all worlds – the welfare state in all its variations. These promises were particularly strong during and after the world wars: in exchange for the untold sacrifices of its citizens for the nation, in turn, the state would ensure that the citizens’ lot definitively improved. Thus, all the suffering would not have been for nothing.

These mutual expectations of the majority of working voters and the promises made to them by elected officials led to serious political tensions that dominated the last century, forcing employers into the role of lobbyists, if nothing else due to their smaller numbers – a role that they naturally played with verve. Already before the First World War, the powerful Central Association of German Industrialists (based on the iron and steel conglomerates) saw the approaching storm. Following the 1911 law on a separate white-collar insurance, Alexander Tille, a leading member of the association, commented:

This is a legislative measure based neither on destitution nor on regard for the maintenance of the nation’s strength. It is merely an aspect of so-called social policy, i.e. of consideration for the wishes of those voters to whom it is desired to show consideration. If it becomes a custom in Germany that, whenever any particular group of the population wishes to be maintained in greater comfort, the government makes a law to satisfy their wishes, it will not be long before we are in a socialist state.138

His prediction would prove true quicker than he had thought or feared, but he was too pessimistic about the resilience of his organization and that of other employer organizations in a parliamentary democracy, as history would demonstrate time and again.

In most countries, the welfare state has never been declared, nor has it been abolished as such. An exception, albeit not utilizing this precise term, is the seizure of power by authoritarian parties who promised utopia from the outset. The Russian Revolution and its imitators are the most famous examples, and also corporatist regimes, in particular in the interwar period, which rendered parliamentary democracy redundant in favour of the greater happiness and welfare for all – except for their scapegoats, of course.

Yet, it also did not emerge out of the blue. The emerging nationalism in the nineteenth century paid increasing attention to the population’s workforce and wanted to deploy it for the fatherland. The concern for its enforcement ensued later. A fine example comes from Japan, where the Factory Girls’ Reader, a simple textbook for young, female textile workers from 1911, wrote about the necessity of ‘Working for the Sake of the Country’:

Everyone, if you all work to the utmost of your abilities from morning to night, there can be no loyalty to the country greater than this. If you do not work thus and stay idly at home, the country of Japan will become poorer and poorer. Therefore, work with all your might for the country’s sake, enabling Japan to become the greatest country in the world. Everyone of you, no matter what your age, you would not want to become a burden to your father and mother who have to toil unceasingly. . . . For your own sake, for your family’s sake, for your country’s sake, devote yourself heart and soul to your work.139

The First World War brought the first acceleration in the willingness of parliamentary democracy – not coincidentally only then having come to full maturity – to guarantee forms of income and other welfare. This was no longer intended as a remedy and, in extremis, to prevent serious social unrest, but as a universal right for all those committed to the salvation of the nation, de facto for all workers and in particular for wage workers and the self-employed. The concern for wage dependents was primarily expressed in the prevention of mass unemployment, if only because it was the biggest threat – in the short term, because of demonstrations or, in the worst case, the looting of shops, or in the long term, due to punishment in the elections and the change of political parties in power.

As we have seen, on the eve of the war, legislation was already being passed in the core industrial countries. However great the differences in implementation were between different countries, the general tendency was to regulate welfare not only locally but also nationally, and thus uniformly, and to combat not only the most extreme poverty but, increasingly via obligatory insurance, that of, especially, the wage dependent (something that subsequently became active labour market policy). The precondition for this was the discovery of the phenomenon of unemployment. That sounds strange now, but until the 1890s the word ‘unemployment’ was rarely used. Whereas the French census of 1891 offered no possibility to register someone as unemployed, that of 1896 did so for the first time. Now an explicit distinction was made between those voluntarily unemployed (persons aged 65 and over were regarded as no longer active and hence not among the unemployed) and the real jobless.¹⁴⁰

This awareness among statisticians of unemployment as a structural phenomenon originated in the discovery of the regularity of trade cycles in the last decades of the nineteenth century. This discovery is reflected in the Minority Report of the British Royal Commission on the Poor Laws of 1919. Traditionally, its concern had been with casual unemployment, but now the proposal was to abandon the much-hated local relief programmes and, most significantly, the alternative: instead of the traditional remedies, the report proposed counter-cyclical variation in work contracted by the central government departments. The labourers engaged in such projects should be rewarded with normal wage standards. The report also raised the issue of funding these works by borrowing from underemployed capital during a depression, to be repaid during a boom.141

The First World War, which ended the long nineteenth century, with its endless series of official and less official reports on the poor and then on the unemployed, brought about a new period of intensified activity. Two causes of this major change during the war stand out clearly: firstly, massive state intervention in national economics, including the labour market (among other things, at the cost of employers’ initiatives);¹⁴² and secondly, claims by workers on social security in exchange for the sufferings of war, claims that had to be taken seriously as a result of widespread revolutionary threats.

As the Great War turned out to be more than a single campaign with a handful of major battles, governments increasingly had to mobilize their national resources, now including the labour market. Major parts of the labour force not only were channelled into military service, but simply never returned. Around 16 million combatants died or were lost in the war, and another 20 million were wounded. In order to meet increased production targets, more and more men and, in particular, women (see pp. 337–8) were drawn or even forced into the labour market, especially into the war industries.

In the revolutionary years that followed the Armistice, governments started to proclaim the right to paid work for their citizens – echoing an old claim by the French revolutionaries of 1848. As the first democratic constitution for Germany, the Weimarer Verfassung of August 1919, stated in Article 163: ‘Every German will be offered the possibility to take care of himself by paid labour. As far as appropriate labour cannot be provided, his basic needs will be cared for.’¹⁴³ But it was not only in the defeated countries that workers claimed their rights. In Britain, in March 1919, Lloyd George’s cabinet refused to return to the gold standard (abandoned in 1914) out of fear of the prospect of unemployment, especially among demobilized soldiers. For the first time in British history, unemployment took political priority over the opinion of the Bank of England and the Treasury. As we have seen, in many countries, compulsory state-induced unemployment insurance and state-organized labour exchange became intertwined. After a try-out of the combination in 1911, Britain was the first country to introduce a virtually universal compulsory unemployment scheme connected to the labour exchanges in 1921. Other countries, like Sweden, developed a dual system, in which the government dealt with unemployment insurance and employers and unions cooperated in labour mediation.

The Great Depression of the 1930s re-intensified the debate about ways to steer the labour market. While Germany adhered to the primacy of politics, Britain emphasized understanding the workings of the market. Guidance was offered by the now widely accepted conclusions of the 1909 Minority Report and by William Beveridge’s new and influential book Unemployment: A Problem of Industry (1930). Beveridge, intellectually cooperating with Keynes, understood that unemployment is nothing more or less than an economic problem of matching supply and demand in the labour market.144 As a result of these intellectual developments, the liberal government in the 1930s again abandoned gold, thus enabling exchange-rate policies that, in addition to protectionism, favoured competitiveness and thus employment opportunities. It also promoted labour exchanges, counter-cyclical works of ‘national utility’ and, above all, national insurance for those in cyclical trades – relieving unemployment, but not curing it.

Most central, eastern and southern European countries adopted different measures, much more heavily biased towards a primacy of politics over economics. Germany’s answer was a total state monopoly of labour market regulation: not a universal right to labour but the universal duty to work became the point of departure, years before Hitler came to power. In fact, strong labour market politics or even dictatorial measures became widely accepted in view of the new situation. At the Geneva Conference of 1934, Harold Butler, the director of the ILO, saw no problem in saying that Italy, together with the US, the Soviet Union and Germany, was at the forefront of creating a new economy. He praised Italy’s progress ‘in the construction of the corporative system that breaks away with economic theories based on individualism’. This was all the more remarkable since, by that time, unemployment in Italian industry was two-and-a-half times higher than in 1929. Most of the policies of the Italian fascists were not new. Their semi-official international recognition, however, shows how deeply the Depression had influenced the ideological approach to labour policies worldwide.¹⁴⁵

Not only in those countries that were already heavily centralized in the 1930s but also in others like Britain, the Second World War signalled a rapid expansion and intensification of government intervention in the economy, even more so than in the First World War. London now accepted a fiscal policy aimed not only at funding the war but also at fighting inflation (the great problem in the preceding war) by keeping personal budgets down. This revolutionary Keynesian integration of national budget and national accounts would endure in the post-war decades. From 1942, comprehensive manpower planning was organized by a Ministry of Labour and National Service. The Treasury lost its central role, as illustrated by the proliferation of economists in the government bureaucracy and a growing trust in rational intelligence as a way to resolve social problems, which was also seen during reconstruction after the war. Liberals like Beveridge and Keynes became more important than Conservatives and Labour. They wanted to reform the existing economic system without threatening private property.

The 1944 White Paper on Employment Policy distinguished between frictional, structural and general unemployment and pleaded for ‘high and stable’ employment. Beveridge’s programmatic publication of that same year was entitled Full Employment in a Free Society. He advocated a strong role for government planning in the public sector, though private investment would continue. These ideas deeply influenced politics not only in Britain but across Europe. Because of the increased competition between the two great socio-political systems, Western European governments were now even more convinced than they had been after the First World War that they had to respond to workers’ claims by introducing fundamental changes to social and economic policies.

Notably, as the Cold War gained momentum in the 1950s, while economic growth proved possible beyond imagination, the welfare state became the norm in Western Europe – to such an extent that nothing seemed more normal than this state of affairs. A combination of scholarly insight and political will seems to have resulted in a solution to ‘make’ society. The general optimism about what was seen as the result of Keynesian economic policy was expressed by Michael Stewart in his Keynes and After. In this widely read Penguin pocket reader, first published in 1969, reprinted several times and translated into many languages, this senior advisor to the Wilson Labour government was happy to announce:

Mass unemployment was brought to an end by the Second World War. It never returned. Despite dire predictions in 1945, Britain has now enjoyed full employment for more than thirty years. Such a tremendous transformation might be expected to have many causes. But in fact the evidence points to one cause above all others: the publication in 1936 of a book called The General Theory of Employment, Interest and Money by John Maynard Keynes.146

The period is also characterized by an emphasis on international agreements. European governments considered them essential to the success of the welfare state. It was thought that only agreements of this kind could prevent a country from being drawn into a crisis by another one, with unforeseeable consequences. Britain was particularly active in pursuing such agreements in the late 1940s and early 1950s, especially through the Economic and Social Council of the UN (ECOSOC), but largely in vain because of American opposition. In the end, the GATT (General Agreement on Tariffs and Trade) was the only device left after the still-birth of the ITO (International Trade Organization) and the short-lived Bretton Woods Agreement. This was a far cry from the Keynesian ideals of the 1940s.

Before continuing the saga of the welfare state, after it was challenged deeply during the economic world crisis of the 1970s and after, let us briefly turn to the communist variant, and its competition with the democratic variant, as briefly described, both within Europe and in the rest of the world.¹⁴⁷

The Soviet Union was the first country to take radical measures to ensure a just income for its working population.¹⁴⁸ By cutting out profit for employers and embracing the ideal of equality of the French Revolution, a workers’ paradise would be created on Earth. The reality was different. The objective facts are that, until at least the 1950s, the USSR remained an agrarian society largely living under harsh climatic circumstances. That could, of course, be said about Canada as well, but what is different are the disasters on Russian soil caused by two world wars and a protracted civil war, together lasting some thirteen years, in the period 1914–45. The Soviet leadership was perfectly aware of this. It therefore preached that the masses should be patient and that, before entry into the heavens of real communism – the welfare state, communist-style – could be achieved, a transition period of ‘socialism’ was necessary.

Under transitional ‘socialism’, wage differentials were still deemed necessary as labour incentives to overcome economic problems of low productivity and low industrialization. This refers to what Marx wrote in 1875 in his Critique of the Gotha Programme. According to him, the first phase is one in which goods are still scarce and people need extra incentives to work for the final goal. That goal is communism when there is not only abundance but when also, ultimately, this abundance is distributed from each according to his ability, to each according to need. Lenin wrote in the margin of his own copy of the first printed edition (1890–91) of this book the biblical judgement ‘he who does not work, neither shall he eat’. In total alignment, Stalin flatly called the egalitarianism of the trade unions, dating from before the revolution and still powerful in the early 1930s before the purges, ‘petty-bourgeois’. As late as the 1960s and 1970s, Soviet academic economists were stating that ‘excessive equality’ would threaten the building of communism – the main objective of socialist society.149

These constraints between the ideal of communism and its welfare rights, as promulgated in several constitutions between 1918 and 1977,¹⁵⁰ and the realities of a revolutionary transformation of the country into a modern industrial state under extremely adverse circumstances, determined the peculiarities of the Soviet welfare state. In order to meet the needs of the people, the USSR distinguished between free-of-charge services, in particular education between the ages of 7 and 17–18 (plus partially kindergarten and free tuition and stipends for universities) as well as medical care, and the remaining goods and services at subsidized prices.

In order to enable people to buy their food, pay their rent and so on, the state, which in principle as owner of the means of production disposed of all goods and services produced, made transfer payments to particular groups. This included pensions and sickness benefits (but no unemployment benefits after 1930!), maternity benefits, child allowances and a few more – plus, of course, cash wages. In the 1950s and 1960s, the hope was expressed that even more goods would be transferred from the ability to pay for them to distribution ‘according to need’. The Party Programme of 1961 – Khrushchev’s vision of a welfare state – claims that this real communism would apply to things like bread, housing, urban transport and meals in factory canteens. But these claims have never been realized.¹⁵¹

Reality was harsh, however, and Stalin departed from the idea that the peasantry, now members of collective farms, would take care of themselves. For the rest of the population, mainly state employees under conditions of full employment, only disability pensions were needed for the victims of industrial accidents and, from 1941, of war accidents. All others in need were idlers, wilfuly refusing work. It was only recognized in the 1960s that this could not be maintained, as substantial parts of the population officially lived in poverty. Out of a total population of 230 million in 1965, no fewer than some 50 million state employees and their dependents, plus 30 million kolkhoz members, lived below the poverty line.152

This points to a dramatic failure of the Soviet-style welfare state, even if real income per capita may have doubled between 1965 and 1990.¹⁵³ Fortunately, reality was not entirely bleak, due to the inventiveness of the Russian population. In infinitely creative ways, it circumvented the rules and improved living conditions at the household level with the live-in grandmother as the indispensable centre.¹⁵⁴ This was thriving babushka-household-welfare as a compensation for a very bleak state welfare. As a result, popular scepticism about the state’s pretensions became widespread following failures to deliver social policies in the 1970s and 1980s. Therefore, and apart from all sorts of unfreedom, perestroika, involving the introduction of markets in the place of central planning, came as no surprise.

The competition between communist and capitalist (including socialist) worldviews gained a boost after the Russian Revolution. Not only did both sides try to overthrow each other by economic and political means, but also the appeal of their material success, especially apparent from welfare provisions, played a role now. The virtues of ‘really existing socialism’ were propagated by communist parties worldwide under the strict control of the Communist International (Komintern) based in Moscow. Stalin declared to the world about the 1936 constitution: ‘the working class of the USSR is completely new, liberated from exploitation, a working class the like of which the history of humanity has not known’.¹⁵⁵

In the interwar period, this competition was especially visible in the colonies of the Western powers. There, the colonizers’ welfare pretensions had only recently emerged and, in general, had not yet been very successful. So, the communist model could successfully boast of the availability in Russia of free education and medical care when even the most idealistic proponents of enlightened colonialism had to confess their impotence in these fields.

The extension of communism after the war, eastwards to China and westwards to Eastern and Central Europe and the Balkans, put the wind in the sails of the communist appeal, including in parts of the world where colonizers were reluctant to give up their power. Propaganda regarding different types of welfare played a central role in the Cold War.¹⁵⁶ Happy workers on Chinese and Russian posters may have played a role, supplanting hard facts about the proletariat’s real income in material terms. More important, however, was the communist promise, just as before the war, of free education and free medical care (notwithstanding the poor performance of these, evidenced by very negative demographic developments) and the right to work, as well as the early closing of the gender gap in education and low social inequality. More than Angola, Mozambique or Vietnam, Castro’s Cuba offers the perfect example of an application of this overseas.

But the Western idea of the welfare state also had a wider appeal. That is often forgotten in all the gloom about austerity measures in the West. In the democratization wave of the 1980s and 1990s, in which many military and other dictatorships died, the civic movement simultaneously promoted a better reward for work and more security of existence.157 We see this in, for example, Argentina and Brazil, but also in South Korea and Taiwan in this period. In South Korea, four decades of authoritarian rule came to an end with a civic movement in which the general strike of 1996–97 played a decisive role. In their simultaneous demand for democracy and redistribution, social welfare workers and their trade unions and reformist elites worked together.¹⁵⁸

In the backlash of neoliberal market reforms that quickly followed, in particular with the Asian Financial Crisis of 1997 and the global banking crisis of 2008, many of these achievements survived. Everything was nibbled away from the universal social insurance scheme that was introduced in South Korea from 1997, especially in the sphere of old-age pensions, but its national health care programme proudly remained in place. The welfare gains of the early 2000s in Brazil and especially Argentina have suffered most.

After the demise of the Soviet Union, only China is left as a powerful protagonist of communist welfare, in particular after it has been able to realize impressive economic growth figures and recently also to invest heavily in poor Asian and African countries. Maybe because the Western world no longer shows pride in its welfare achievements, China seems to have recently lost its inclination to do so too. Overseas investment and economic growth are the new slogans, leaving recipients and the rest of the world in the dark about other possible objectives. The spread of the communist welfare example definitively seems to have vanished from the scene, to be replaced by the New Silk Roads.¹⁵⁹

The welfare state in trouble

Nowhere else has the welfare state been jeopardized more than in the country that started it all. In 1985, Margaret Thatcher’s Conservative government published the White Paper ‘Employment: The Challenge for the Nation’, with its central message that the government has only to create a climate in which private enterprise can flourish. The main difference with the 1944 White Paper was the rejection of the government’s responsibility for welfare; its only task was to ‘set the framework for the nation’s effort’.160 It should concentrate its efforts not on the demand side, as in 1944, but rather on the supply side of labour, by training young people, by propagating better management and wage moderation and by starting an extensive programme of ‘deregulation’.

The change in international perspective between the 1944 and the 1985 White Papers was striking. In 1985, there was no longer any talk of international cooperation, only of national policies: ‘external events are treated as entirely exogenous, outside any control of government’. Arguably, this reflects the decline of Britain’s international power over the previous forty years, but also the fact that ‘its perceived scope for successful action [was] reduced almost to vanishing point’.

Although the trend towards the deregulation and reduced pretensions of the welfare state is evident in all countries in the North Atlantic, there are still substantial differences between the US, Britain and the Continent. In the US, the distinction between the privileged, white, male breadwinners and other wage earners was pronounced long before Reagan. In 1960, the American public intellectual Paul Goodman, in his peculiar and provocative style, had already contrasted the working poor in America (‘Negroes, Puerto Ricans and Mexicans, migrant farm labor’) that were ‘outside society’ with, on the one hand, the factory workers, and on the other:

the vast herd of the old-fashioned, the eccentric, the criminal, the gifted, the serious, the men and women, the rentiers, the freelancers . . . Its fragmented members hover about the organization in multifarious ways – running specialty shops, trying to teach or to give other professional services, robbing banks, landscape gardening, and so forth – but they find it hard to get along, for they do not know the approved techniques of promoting, getting foundation grants, protecting themselves by official unions, legally embezzling, and not blurting out the truth, or weeping or laughing out of turn.¹⁶¹

The much greater income inequality in the US compared to Western Europe, which goes hand in hand with rising labour productivity, can be explained by the drop of the federal minimum wage. Still the highest in the world in the 1950s/1960s, it has dropped by 30 per cent since the 1970s and 1980s.162

In the European countries, to a certain extent, the ‘Rhine Economic Model’¹⁶³ is upheld against the neoliberal model of Reagan and Thatcher, with social justice versus efficiency; compromise, consensus and cooperation versus confrontation and competition; long-term stability versus dynamism and change focusing on short-term results; and finally, a concept of government as a difficult yet vital partner, with a mutual dependency between government and the economic actors, versus a modest government that should be kept at arm’s length. It is remarkable that Germany, despite its major difficulties in uniting the two former parts of the country after 1989, has stuck to the principles of the Rhineland economy. And also outside Europe we cannot simply speak in an overly pessimistic tone of the demise of the welfare state; think again of the examples of South Korea and Taiwan. China, too, deserves special attention, and very recently even India.

This does not mean that nothing has changed on the European continent. The welfare state has clearly lost part of its pretensions, certainly after the deep financial crisis of 2008. The outcome is an increase in social inequality, as pointed out effectively by the French economist Thomas Piketty, who indicates the drop in the share of national income going to labour.¹⁶⁴ To be clear, this is primarily about the widening gap and less about the stagnation of incomes at the bottom, in particular of wages over the past four decades. Despite the widespread availability of mobile phones and other electronic devices, Piketty believes that the real available income per household of ‘the bottom 50 per cent by income’ barely grew, if at all, in these years, certainly in the US. And again: this is despite a sharp increase in labour productivity,¹⁶⁵ not only in continental Europe, but – as might be expected – certainly also in Britain and the US. This growth in inequality perhaps hides an even more important phenomenon: the stagnation in social mobility in the North Atlantic. Whereas in the first half of the twentieth century, workers there got used to improved standards of living generation after generation, this mobility has clearly slowed down. For many, like those in the American ‘rust belts’, it has simply vanished in recent decades. Many workers and small independent producers have simply lost hope of any improvement for themselves and for their offspring in the long run.

As already indicated several times, most countries, with the US and the UK taking the lead, adopted diametrically different socio-economic policies from 1980. In democratic countries there was also sufficient electoral support for this, in particular because wage workers turned their backs on social democratic parties (Labour in the UK, the Democrats in the US, and so on). According to Piketty, this collapse of the working-class vote for socialist, communist and social-democratic parties was directly linked to ‘the reversal of the educational cleavage’, coinciding with a significant expansion of educational opportunities and upward social mobility in the post-war decades: ‘the less educationally advantaged classes came to believe that the parties of the left now favor the newly advantaged educated classes and their children over people of more modest backgrounds’. In France, for example, ‘those [working-class] children and grandchildren who managed to make it to the university (and particularly those who earned the more advanced university degrees) are the ones who continued to vote for the parties of the left with the same frequency as the less educated voters of 1956’. And, as he shows, this does not only apply to France.166

The growth of income inequality within countries is now even becoming a global phenomenon. At the same time, the deep gap in economic performance between the different parts of the world is closing, in the first place due to the rapid rise of China, but now also due to India – with a completely different political system – having made gains.

We have already seen the expansion of wage labour between 1500 and 1800, mainly as an extra source of income for peasants outside the rare and generally still small towns. After 1800, it increasingly became the sole source of income – and is currently so for the majority of the global population. The advent of wage labour has had a number of implications for the way we look upon work and how we, as working humans, try to defend our interests, individually, collectively and in the political framework.

Initially, it brought about the phenomenon of the male breadwinner ideology, which has only recently been receding in order to include all workers. Alongside examples of apartheid and inside-outside thinking, we have also seen the advent worldwide of the norms of horizontal cooperation, job pride and fair labour relations. Think of the mainstream Tille or the more extreme positions of Lafargue and Malevich. And let us not forget all those examples of collective action that we have encountered in this chapter. Think, finally, of the principles on which the ILO and the United Nations are built, however problematic their execution.

The close connection between industrialization, efficiency and wage labour has also tilted the ratio between working time and leisure time. Whereas in earlier times, most waking hours had to be spent on work, in the last century leisure and schooling have taken that position. It should be noted that in the ‘Global North’ this movement halted a few decades ago, but not in the ‘Global South’, and especially not in China in recent decades. In particular, if we take the household as a unit of analysis, in the ‘Global North’ we observe another increase in the hours worked by husband and wife together. However, their compensation in real terms, per hour, appears to have been stagnating for a number of decades. Economic growth accompanied by an equal distribution of welfare, which was the norm in the 1950s and 1960s, is over.167

More hours per household spent on the job enables it to increase consumption, primarily in the rich North Atlantic and its offshoots, but at a price – and with the undoubtedly detrimental consequences for the environment, including climate change (a theme that is beyond the scope of this story). To exaggerate slightly, the more prosperous workers do not have enough time to spend their earnings. And notwithstanding the passing of the first, the second and the third industrial revolutions (an expression borrowed from Jeremy Rifkin), the availability of jobs has not diminished.

Wage workers defend their interests differently from their self-employed counterparts, who still today mainly rely on the strength of the household. Apart from private strategies, among which geographical and social mobility are especially important, wage workers have also further developed what is called their repertoire of collective action. Trade unionism immediately comes to mind, but historically we may discern many more types of collective action and of organizations. The balance between private and collective strategies is continuously moving. After periods of success for trade unionism following the First World War and especially the Second World War, this type of organization is now clearly in trouble.

The successes of classical collective action have brought about the welfare state in many different forms worldwide. Common is the increasing role of the state as an arbiter of the labour market and as a provisioner of welfare. This has become an integral part of the democratic process.

But to what extent, for how long, and what are its implications? That, as well as a general reflection on the nature of work from a long-term perspective, is the theme of the Outlook that concludes this book.