Beyond the Beautiful Appearance of The New Digitalised World of Work -
From Wilhelm Reich's "Work Democracy" To Future Economic Democracy
Almost limitless "freedom" is being promised to workers in both the present and future of the digitalisation of the world of work - ideologically used buzzwords such as "flexibility", "autonomy", "empowerment", "self-leadership", "self-responsibility", "voice", "employee involvement", "participation" or occasionally even "democratic work" are to be found on the lips of almost everyone (e.g. business school lecturers, managers and management consultants) - the world of labour seems to be (neo-)liberally enlightened. The new promise of freedom in "virtual" production networks, digitalisation and agile production is supported by widely networked "artificial intelligence" and it supposedly "empowers" employees to become "co-entrepreneurs", often even in global supplier networks and in the "platform economy". For years, such statements have been declaimed not only in everyday media and popular management literature on the newsstand, but also in academic publications and universities, as the Handbook of Critical Management Studies demonstrates in many ways (Alvesson et al., 2009). So much for the glorifications of the current economic mode and worlds of labour. The power and profit interests pursued with these technocratic concepts shine through everywhere. However, beyond these explanations, there are two characteristics of the definition of actual entrepreneurship that are not being disputed by either proponents or opponents of capitalist economics:
1. ownership of the means of production; and
2. the right to decide on and responsibility for strategic decisions.
Anyone who wants to clarify the question of what the assertions of freedom mean in concrete cases, i.e. in concrete private, cooperative or public enterprises, in a scientifically serious way will not be able to avoid using the two characteristics just mentioned as a yardstick. In numerous cases, it will then turn out that the "unlimited freedom" from the perspective of dependent employees or self-employed pseudo-entrepreneurs is rather a "freedom" for the owners of capital and their agents to exploit "human capital" without any borders (see e.g. Alvesson, et al., 2007; Weber, 2006). Common to these employment relationships, which are based on the implementation of so-called neo "liberal" management concepts, is the idea that workers at all levels, down to the assembly line, are expected to assume only very limited entrepreneurial responsibility. They are subjected to permanent cost and performance pressure, forced into supplier-customer relationships and must permanently prove their worth (in terms of “added value”) to management in the form of target and performance agreements and regular evaluations. In doing so, they are integrated into sophisticated controlling and quality management systems using differentiated performance indicators. If the working individuals fail to sufficiently demonstrate their economic "value" as "human capital", then they are threatened with "release", i.e. dismissal or "outsourcing" as a "labour entrepreneur" with a frequent deterioration of income and health and social care.
This is clearly expressed in the accompanying invocations to workers and their managers: "Star" or "Best Performers", "Best practice", "Excellence", "Competitive Customer Orientation", "Total Quality" and, of course, "Added Value" - after all, the appropriation of the surplus value generated by the dependent employees is what it all comes down to. This is hardly surprising in an increasingly deregulated capitalist economy dominated by software, finance, energy, agro-chemical, food and other large corporations (often called "oligopolies" in the case of the Russian nationalist dictatorship). Incidentally, the global number of billionaires has increased by nearly a quarter in the wake of the Covid pandemic (https://www.dgb.de/themen/++co...). The discourse of freedom enacted by radical capitalist economists and management scholars can thus be seen as a new variant of a phenomenon Herbert Marcuse (1964) called repressive desublimation. The latter referred to the instrumentalisation of "sexual liberation" for the purposes of marketing, the development of new consumer needs and the distraction from social injusticies. In contrast, the new repressive illusion of freedom aims at "liberation", i.e. exploitation of human striving for autonomy, competence and belonging for the primary purpose of maximising profit and securing economic dominance (see Kasser et al., 2007) - because economic co-determination and substantial collective capital participation are not granted to service providers in "neoliberally" managed enterprises.
However, the radical capitalist (ideologically camouflaged as "neoliberal") way of doing business has not (yet) gained global totalitarian acceptance, because islands and even networks of solidarity economy and democratic enterprises owned by workers still exist all over the world, as social and economic research reviews have shown (e.g. Ferreras et al., 2022; Unterrainer et al., 2022; Weber et al., 2020).
As early as 1943, Wilhelm Reich wrote a psychoanalytically influenced conception of work democracy, which addressed the question of what a democratic world of work, freed from capitalist, fascist and Stalinist ideology and oppression and adapted to the "natural sociality of man", might look like (Bennett, 2010). It was then integrated into his 1946 revised book Mass Psychology of Fascism (Reich, 1974). There he paraphrased work democracy as being a "natural process of love, work and knowledge", as "the sum of all naturally grown, naturally developing and organically governing rational interpersonal relations" (Reich, 1974: 276f.). In order for love to develop both in the sense of interpersonal eroticism and sexuality, which are not neurotically or pathologically restricted, and in the sense of a general human kindness, together with competences for vitally necessary work as well as for life-serving science, specific social institutions are required according to Reich. These institutions should take the place of authoritarian family, church, school and economic institutions that educate and influence people to have a certain hostility towards pleasure. Even though Reich's remarks on this are rather vague after his renunciation of authoritarian communism, he is oriented towards a " work-democratic self-government of society" (Reich, 1974: 279, 284). He means bodies elected by the workers, in which producers and consumers, instead of politicians and economic leaders work closely together in planning and distributing what is to be produced, from the local level all the way up to the international level.
Despite the destructive tendencies of all social systems at that time, which he analysed, Reich was convinced that a sufficient number of professionally and socially highly developed professional representatives with a high sense of social responsibility could be found, who would provide the basis for building such a democratic self-governing economy, which would correspond to the basic human needs for love, work and knowledge. Authoritarian power relations, including autocratic and destructive leadership behaviour, should also be abolished in the domain of work and business. In their place there would be the free cooperation of mutually supportive workers according to the factual requirements of the production of "vitally necessary" products. We may interpret this expression from today's perspective as life-serving products in the sense of humanistic business ethics (Ulrich, 2008). Reich considered this as being an important prerequisite for the success of a democratic, non-destructive society. Reich explained in this regard (1974: 327): "The work-democratic way of life demands the right of every worker to engage in discussion and criticism". What is meant is constructive, factually based and supportive criticism at production meetings, which always keeps in mind the common goal of those working together democratically to create products that are useful to life.
In light of today's knowledge of critical work and organisational psychology based on the social sciences, Reich's ideas could be criticised in many respects. This applies, for example, to his assumption that work democracy already develops naturally if only the "millennia-old suppression" of natural needs (the "vitally necessary functions"), especially sexuality (Reich, 1974:280) and the resulting armouring of character were overcome. His reification of "natural work" would also have to be problematised, which overlooks the fact that in the course of the cultural development of humanity, "natural scientific constraints" restrict the carrying out of specific work activities and the design of specific products less and less, as can easily be demonstrated by means of certain activities of social services, software production, product design and marketing,. Rather, work activities and products are determined just as much by social criteria and agreements concerning their benefit for life and ecological sustainability as by biological and physical laws (see e.g. Ulrich, 2008). In this respect, Reich's hope of a "naturally" emerging work democracy and his late - biographically understandable - ignorance of a scientific analysis of political-economic power relations and his rejection of any politics are misguided. Finally, Reich also somewhat underestimated at the time the destructive force that poor working conditions such as dull assembly line work or working under extreme time pressure can have on the psychological well-being, irrespective of the "millennial" or even family oppression, of the workers concerned.
Notwithstanding these conceptual problems, however, parts of his critique of ideology, especially his explanation of the genesis of fascist characters and his ideas on the self-management of life-serving work, are of current importance, even from my lay psychoanalytic point of view. This is evidenced by numerous psychologically relevant studies conducted in the field of work and economy. Due to reasons of space, I can only hint at two examples from my own long-term research projects as evidence.
First, self-regulated (= "semi-autonomous") work groups provide a basis for workers to satisfy their basic social and mental needs to a certain extent, even in professional activities, and, in so doing, to assume social responsibility for the production process and the life-serving product they help to create, as envisaged by the concept of work democracy. In a self-regulated work group, several workers in a spatially and organisationally delimited work area are assigned a common overall task in collective responsibility, which serves the production of jointly produced complex products (or services). The group plans, coordinates and controls the carrying out of the necessary, interrelated subtasks itself. Both through joint planning and decision-making and through job rotation between demanding intellectual and executive activities, each group member also benefits from work that has positive effects on the further development of his/her personality (Ulich & Weber, 1996).
The concept of self-regulated group work proved its worth in some European and North American companies, first in motor vehicle and plant construction and later also in project and administrative work (Moldaschl & Weber, 1998). The Norwegian government programme on industrial democracy as well as the Swedish work structuring projects at Volvo and Saab had an initial effect that also had an impact on the German government programme to implement a "humanisation of working life" in the 1970s and 1980s. This direct-democratic concept of group work did not spread widely in Europe or on other continents. This is because restrictive forms of group work such as "lean production" are much easier to control by management in terms of maximising profits and ensuring dominance in the company. Nevertheless, self-regulated work groups can still be found today in some democratic enterprises and in certain companies that produce complex products in individual pieces or small series.
Second, in order to realise work democracy on a broad scale, a supportive system of economic democracy would be needed in the society, which builds on democratically structured enterprises. There is little about this in Reich's reflections on work democracy, except for references to early attempts in the then Soviet Union, which were soon abolished by Stalinism.
Economic democracy now encompasses a diverse set of models and tools for the democratic and social regulation of market economies. Economic democracy strives for a balance between economic and social policy. In so doing, the actors affected by economic activity, e.g. workers and employees, managers, capital owners, consumers, environmental protection and civil rights initiatives are to be involved in the regulation of economic policy and business processes at different levels, either directly or through elected representatives. Economic democracy thus aims to enable workers and other affected groups to participate in decision-making and self-determination at different levels of the economy in order to pursue their own interests such as employment security, protecting their physical and mental health and personality development at work. Through "education for political maturity" in the company, democracy in the society is also to be protected from radical capitalist and extreme right-wing threats (see in detail: Demirović, 2018; Ferreras et al., 2022; Wright, 2010). In the course of the democratic council movement in the years after World War 1, attempts at economic democracy also achieved a certain significance in Austria through the public economic institutions in Otto Bauer's, Rudolf Hilferding's and Max Adler's "Red Vienna", through further democratic worker cooperatives and through the creation of workers' chambers and works councils. Since Reich had a practice as a psychoanalyst in Vienna in the 1920s and was involved on the left wing of the Social Democratic Party, this economic democratic milieu may well have influenced his later thinking on work democracy. The Swedish model of co-determination and the formation of productive capital under the co-control of the trade unions (wage earners’ funds), which was stopped in the 1970s by conservative politicians and business associations, was also strongly influenced by these Austrian social democratic ideas and their further development by Karl Polanyi.
Democratic enterprises, e.g. worker collectives decided by grassroots democracy, employee-owned productive cooperatives and enterprises structured according to the principle of representative democracy, form an essential basis of economic democracy. They enable their workers to participate, either directly in general assemblies or indirectly through elected representatives, in decisions on company tactics (e.g. selection of personnel, election of superiors, income system), but also on strategic decisions (e.g. company planning, investments, appropriation of profits). So far, democratic enterprises have been a minority in the economy: the European Committee of Worker and Social Cooperatives included 50,000 enterprises with about 1.3 million employees in 2017. The two largest democratic enterprises in Europe are the Basque Mondragon Network with about 82,000 employees and the British John Lewis Partnership with about 86,700 employees. The vast majority of such companies seem to be able to maintain and to renew their democratic structures and practices even after decades, according to our systematic research review (Unterrainer et al., 2022). The findings of another organisational psychology research review (Weber et al., 2020) suggest that phenomena of work democracy in the sense of Wilhelm Reich can indeed develop in democratic companies: the extent to which workers participate in democratic decision-making is associated with the supportive work climate that they experience, their solidarity and their willingness to help each other, their intrinsic work motivation, their commitment to their company, and their civic and democratic orientation. However, no correlation with employees’ physical and mental health was found.
Of course, this contemporary research does not yet prove "whether work also changes its nature in such a way that it can be transformed from a burdensome duty into a pleasurable satisfaction of needs" (Reich, 1974: 256). Longitudinal studies on this are needed, based on a qualitative methodology that also provides a more precise definition of what is meant by "work democracy" in the psychoanalytical sense. Then, using realised examples of economic democracy, so-called real utopias (Wright, 2010), it can be explored whether economic democracy promotes not only the two basic life functions of work and knowledge, but also the development of better sociomoral and perhaps even non-repressive erotic relationships among workers.
Literature:
Alvesson, M., Bridgman, T., & Willmott, H. (Eds.) (2009). The Oxford Handbook of Critical Management Studies. Oxford (UK): Oxford Univesity Press.
Bennett, P. W. (2010). Wilhelm Reich's Early Writings on Work Democracy: A Theoretical Basis for Challenging Fascism Then and Now. Capitalism Nature Socialism, 21 (1), 53-73.
Demirović, A. (Hrsg.) (2018). Wirtschaftsdemokratie neu denken. Münster: Westfälisches Dampfboot.
Ferreras, I., Battilana, J., & Méda, D. (2022). Democratize Work. The Case for Reorganizing the Economy. Chicago: University of Chicago Press.
Kasser, T., Cohn, S., Kanner, A. D., & Ryan, R. M. (2007). Some costs of American corporate capitalism: A psychological exploration of value and goal conflicts. Psychological Inquiry, 18 (1), 1-22.
Marcuse, H. (1964). The One-Dimensional Man. Boston: Beacon Press.
Moldaschl, M. & Weber, W. G. (1998). The “three waves” of industrial group work. Human Relations, 51 (3), 347-388.
Reich, W. (1974). Die Massenpsychologie des Faschismus. Frankfurt/M.: Fischer Taschenbuch.
Ulich, E. & Weber, W. G. (1996). Dimensions, Criteria and Evaluation of Work Group Autonomy. In M. A. West (Ed.), Handbook of Work Group Psychology (pp. 247-282). Chichester: Wiley.
Ulrich, P. (2008). Integrative Economic Ethics. New York: Cambridge University Press.
Unterrainer, C., Weber, W. G., Höge, T. & Hornung, S. (2022, submitted). Organizational and Psychological Features of Successful Democratic Enterprises: A Systematic Review of Qualitative Research.
Weber, W. G. (2006). Added Value statt menschlichen Werten? – Zur Genese von sozialer Entfremdung in Arbeit und Interaktion. Journal für Psychologie, 14 (1), 120-147.
Weber, W. G., Unterrainer, C. & Höge, T. (2020). Psychological research on organisational democracy: A meta-analysis of individual, organisational, and societal outcomes. Applied Psychology: An International Review, 69 (3), 1009-1071. http://dx.doi.org/10.1111/apps.12205
Wright, E. O. (2010). Envisioning Real Utopias.
London: Verso.
Header and front page photo: Atzeni, M. & Ghigliani, P. (2007). Labour process and decision-making in factories under workers' selfmanagement: Empirical evidence from Argentina. Work, Employment and Society, 21 (4), 653–671.
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