Libertarian socialism, corporate power and governance

It's an obvious blindspot spot of Bloggertarians/glibbertarians/swearyTorytarians that they typically have little to say about corporate power. Or rather their arguments take the 'if you don't like company X don't shop there' form, as if consumer 'exit' has enough power to address issues like, for example, escalating executive pay. Personally I think it's hard to take a 'libertarian' seriously if they have nothing useful to say about challenging corporate power, but hey.

I was reminded of this when reading this today. It's not a great book IMO, but it is representative of a thread within the Left that was democratic, socialist and libertarian. And, most importantly, it had something to say about the nature of work, and power in the workplace. Here are some comments about the nature of power:

In the large enterprises, legal ownership of the means of productions has become separated from the management and has lost importance. The big enterprises are run by bureaucratic management, which does not own the enterprise legally, but socially... They administer things and persons, and relate to persons as to things. This managerial class, while it does not own the enterprise legally, controls it factually; it is responsible, in an effective way, neither to the stockholders, nor to to those that work in the enterprise. In fact, while the most important fields of production are in the hands of the large corporations, these corporations are practically run by their top employees. The giant corporations which control the economic, and to large extent the political, destiny of the country constitute the very opposite of the democratic process; they represent power without control by those submitted to it.

I might not agree with this, since I do think we have the potential to control the corporate sector via political power, just that our politicians seem to have lost the confidence to do this. However, in practice, politics too often works to legitimise corporate power, either by not challenging it (see the way the exec pay controversy is redrawn as being just about rewards for failure) or by appointing business leaders to tackle 'difficult' issues as if they are the only group in society able to 'do' anything. And I would struggle to argue strongly against the view that legal ownership doesn't tell us much about who really has power.

I wonder what libertarian Righties would say. Notably Ayn Rand fan Alan Greenspan seems to think that autocratic corporate governance is a necessary evil. A similar argument i have seen is the 'all is for the best in the best possible worlds' view that if a better (ie more efficient model) were available it would have emerged and been backed by shareholders. So I'm not clear they consider there is any problem.

Anyway, here's a bit more from Fromm (hehe) on the general approach to be taken.

[I]f a choice has to be made between greater production on the one hand, and greater freedom and human growth on the other. the human as against the material value must be chosen. In socialist industrialism the goal is not to achieve the highest economic productivity, but to achieve the highest human productivity. This means that the way in which man spends his energy, in work as in leisure, must be meaningful and interesting to him. It must stimulate and help to develop all his human powers - his intellectual as well as his emotional and artistic ones.

Now again I might not agree with this, but it is at least an attempt to think about work and freedom from the point the point of the worker, rather than simply in terms of production (Robert Lane's the Market Experience has a well argued case for this).

And here are some more comments, admittedly pretty vague, about the objectives of this approach to socialism:

Humanistic socialism is the extension of the democratic process beyond the purely political realm, in to the economic sphere; it is political and social democracy. It is the restoration of political democracy to its original meaning: the true participation of informed citizens in all decisions affecting them.

Extension of democracy into the economic sphere means democratic control of all economic activities by participants: manual workers, engineers, administrators, etc. Humanist socialism is not primarily concerned with legal ownership [a bit Croslandite eh?], but with social control of the large and powerful industries. Irresponsible control by bureaucratic management representing the profit interest of capitalism must be replaced by administration acting on behalf of, and controlled by, those who produce and consume.

He goes on to say that shareholders would continue to receive compensation for the use of their capital, but no rights of control or administration, and suggests practical reforms such as 25% employee representation on 'decision-making boards'.

This approach, and the limited proposals put forward, may be impractical, but they are an attempt to deal with power and freedom at work, where we spend a lot of our time. If libertarians don't think there is much scope, or need, for reform here then I'm not sure why we should take them too seriously when they make criticisms of the political world. More broadly though, I think there is plenty of scope currently for the Left to have a look back at its own libertarian history. At the very least it shows us what limited ambition the Right version has.