Thursday, July 28, 2022
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We should celebrate the ‘work from home’ phenomenon – Bill Mitchell – Modern Monetary Theory


We will have Wednesday on a Thursday this week, given my detailed analysis of Australia’s inflation data release yesterday. So today I write less here to write more elsewhere and finish with some of the greatest guitar playing you might ever hope to hear. My topic today is the issue of the ‘work from home’ phenomenon, which is one of the better things Covid has produced. I explain why. But I also realise a lot of commentators view the phenomenon negatively. Some on the Left allege it just means the ‘woke’ class have abandoned the low-paid workers to Covid, while those on the Right are aghast because they realise that, at least, some workers have more ‘control’ over their working lives. My view is that we should celebrate the fact that some workers are happier. I don’t accept the argument from the ‘Left’ commentators that every worker should be miserable if every worker cannot be happier.

The so-called ‘two-class state’

I discussed the issue of capitalist control of the labour process in these blog posts:

1. The labour market is not like the market for bananas (August 17, 2012).

2. If you can have full employment killing Germans … (October 28, 2013).

3. Capitalists shooting their own feet – destroy trust and layer management (September 30, 2015).

Radical economists in the late 1960s and 1970s introduced us to the idea of labour market segmentation and how labour market structure, job hierarchies, wage incentive systems and more are used by the employers (as agents of capital) to maintain control over the workforce and extract as much surplus value (and hopefully profits) as they can.

This literature, which influenced the work I did for my Master of Economics Thesis, challenged much of the extant neoclassical (mainstream) literature which had claimed that factory production and later organisational changes within firms were technology-driven and therefore more efficient.

Instead, careful research showed that the mainstream approach could not be supported given the evidence.

The radicals also eschewed the progressive idea that solving poverty was just about eliminating bad, low pay jobs, an idea which had currency in that era.

They showed that the bad jobs were functional in terms of the class struggle within capitalism and gave the firms a buffer which allowed them to cope with fluctuating demand for their products.

It also allowed them to maintain a relatively stable, high paid segment (primary labour market) which served management and was kept docile via hierarchical incentives etc.

Capital used labour market structure to control the extraction of surplus value as the first stage of profit realisation.

The shift from the cottage-based, ‘putting out’ system into the factory system was not because the capitalists had innovated with new technology.

Rather it was a move to ensure the workers were all under the ‘same roof’ using existing cottage technologies in order that the bosses could control the work process more easily and avoid workers not working long enough or skipping town with the working capital that had been provided to the cottages.

The history of labour process organisation is the history of different evolutions of this control function.

The capitalist class had to introduce a control function because they couldn’t trust the workforce to work hard and long enough to generate the surplus production that was the source of capital accumulation and maintenance of the capitalist hegemony

Why is control necessary? The answer is to be found in the observation that the objectives of workers and firms are rarely – substantively – the same.

Marx considered the relations between those who sell labour power (the workers) and those who buy it (the capitalists) to be fundamentally “antagonistic” or adversarial.

We might summarise this basic conflict by assuming that workers will typically desire to be paid more for working less and capitalists want to pay the least for the most flow of labour services.

We could frame this tension in more complex ways and, indeed, Marx and his followers have done that. But for our purposes that basic conflict still pervades labour markets in modern monetary economies and has to be understood.

This is not to say that business firms do not provide good working conditions and seek to reward their workers in many different ways. The point is rather that they do that without jeopardising their control function or their capacity as purchasers of labour power.

Capitalist firms are always struggling to secure surplus value from their workforces and hope that this value converts to profit when goods and services are sold.

The exercise of control in the workplace must elicit workers’ cooperation in the production process but at the same time aims to extract as much from the workers as is possible and pay them the least for it. in other words, the social relations of capitalist production contradictory.

There are several dimensions to this perspective of the labour process, which I cover in the blog posts cited above.

But today I want to focus on a more recent situation that has arisen during the Covid pandemic – the ‘work from home’ phenomenon.

I have seen some rabid attacks on this phenomenon from those who claim to be on the ‘Left’ side of the philosophical and political debate.

All sorts of insulting terminology is used to vilify ‘white collar’ workers who have been able to work from home during the pandemic – the so-called ‘woke’ class.

Apparently, the ‘woke class’ has conspired with governments to feather their nests (by working from home) and protecting themselves from the virus while abandoning the true working class of low-paid workers to keep delivering them food and other goodies, while being exposed on the front line to Covid and the illness and death that it brings.

I find that conception of what has happened rather odd when it comes from commentators who claim to represent the interests of the working class.

There was an article in the Melbourne Age this week – Working-from-home comforts create new class divide (July 25, 2022) – which was written by a conservative councillor in the Melbourne City Council with a background in law.

So not the Leftist ‘woke’ angle I referred to above, but rather one representing small businesses in the Central Business District who run cafes and other shops that service the office workers in the city.

As an elected local government councillor, the author is clearly trying to curry favour with this conservative constituency to get votes at the next council elections.

It is true though that the ‘work from home’ phenomenon has clearly damaged these petty capitalist businesses.

If the offices are empty then the queues to get lunchtime sandwiches at the city shops are short!

But while the narrative presented in that article is from a conservative, free market type, it is substantially the same as that coming from the Leftist woke accusers.

The author claims that Covid has meant “we are not all in this together” because the decision by governments to allow some workers to work from home has created:

… a permanent two-class state made up of those whose jobs can be done by Zoom and those whose can’t.

The author implies also that public money is being wasted allowing public servants to work from home because their productivity cannot be accurately assessed despite workers telling surveys they are now much happier.

The author also tries the usual equity argument, which is the one that the Leftists focus on:

There’s another reason however why we should be worried about making this a permanent feature of middle-class life.

And that’s because it is an arrangement that is not available to the vast majority of workers and never will be.

Since the dawn of the industrial age the rhythm of physically going to work was something that tied together blue and white-collar workers …

But going forward it seems there will be a select class of people who work from home and another class of people who will make and deliver things to them so that they can.

The evidence is that about 25 per cent of workers can actually work from home and that cohort usually holds tertiary qualifications.

The author is affronted by that:

It is remarkable then how few people, including those on the left of politics, are troubled by permanently creating a society where some have the luxury of working from home when most never will …

Let them eat Zoom won’t put food on the table of most casuals though.

Well, a few on the Left of politics have joined her in being affronted.

But I am on the Left of politics and I celebrate the work from home phenomenon.

It is now acknowledged that the ‘work from home’ phenomenon is here to stay despite the best attempts by employers to demand their workers return to the offices.

The state governments are clearly scared of the occupational health and safety implications of forcing workers into workplaces where Covid can spread more easily given the rising infection and death rates.

Workers are also reluctant to return to their old work habits because they fear getting Covid.

But as time has passed the reason for the preference from workers for ‘work from home’ arrangements is clear.

Workers enjoy more flexibility in their time management.

They can balance non-work responsibilities more easily.

The gender divide of work and non-work responsibilities has become more blurred and males, who can work from home, are under more pressure to take on responsibilities that society had previously considered female roles.

Workers feel better having a smaller carbon footprint – not commuting for hours in cars.

Workers can reduce their costs – they can wear ‘trackies’ all day and only put on shirt and tie for Zoom meetings (not giving away any secrets here).

And all the rest of it.

But relevant to the way this blog post began – and the reason the bosses are livid that the governments will not force workers back to the office – is because the control aspect of the labour process has changed.

Capital has now less control over the daily lives of their workers.

They hate that.

Workers now have more discretion.

More flexibility over their time use.

And more.

So it has taken Covid to break some of the control machinations deployed by capital to keep their workforces under the thumb.

We should celebrate that as workers.

As an academic, I am part of the working class.

The so-called professional occupations have always enjoyed better conditions and pay than the so-called blue collar occupations, which have been further damaged by the rise of the casualised gig economy.

Segmented labour markets have always been operating.

So the ‘professional’ workers have always had it better.

But they have also been subjected to control mechanisms by capital which make their lives less fulfilling etc.

For a Leftist to turn around and accuse these professional workers of all manner of awfulness just because they have been able to wrest some control back from capital as a response to the pandemic seems rather odd to me.

It seems to think that the professional occupations are not part of the class struggle as workers.

I am and I always have been part of that struggle.

I fully understand that the pandemic has had uneven consequences for workers across the occupational structure.

Leftists should not interpret that as an attempt by professional workers to abandon their peers in the occupations that have not been able to ‘work from home’.

Rather, we all should be pressuring governments to ensure that no workers loses income because of Covid.

Let’s pressure governments to regulate that no workers who is exposed to unacceptable health risks so that bosses have to ensure their workplaces are as safe as we can make them.

Bosses should be forced to introduce acceptable ventilation systems, provide masks, maintain social distancing where possible, and all the other things that health care professionals advise to minimise the exposure to Covid.

We could structure the working day into segments for those who cannot work from home – to ensure there are less people on the ‘floor’ at any one time.

Some of these remedies would attenuate some of the ‘control’ mechanisms that capital has in place, which would further benefit those workers who by the nature of their jobs had to go into the workplace.

For those who can ‘work from home’ let’s celebrate the modicum of freedom that has brought them.

Music – Grant Green

This is what I have been listening to while working this morning.

Here is – Grant Green – playing the classic – ‘Round about Midnight – which was first released on his – Blue Note label release – Green Street – in January 1961, before I even really knew what Jazz was.

He isn’t a player who would appear on many lists of the most famous jazz guitarists but he is close to the top of my list.

He recorded a massive number of tracks as a session player for Blue Note during the 1960s.

He was initially heavily influenced by none other than Charlie Christian.

He was in the hardbop tradition while at Blue Note, but later branched out in the early 1970s and started paving the way for what we now call Acid Jazz.

Grant Green died at the very young age of 43 in 1979.

Released on: 1961-01-01

Appearing on this track with Grant Green were:

1. Dave Bailey – drums.

2. Ben Tucker – Double Bass.

The song was composed by – Thelonious Monk.

That is enough for today!

(c) Copyright 2022 William Mitchell. All Rights Reserved.

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