Erosion Inside Capitalism

Submitted by Reddebrek on July 16, 2016

A. V. ROE, A PIONEER OF FLYING and a founder of the Avro aircraft firm, wrote a book about 25 years ago in which he showed that the aircraft industry in this country could, as it was then, build large aeroplanes to enable the ordinary workman to take his family to North Africa for 2 or 3 weeks of sunshine every winter – relays of them. Rehashing the idea recently to a friend, I was asked "Why wasn't it done?" I retorted: "You preferred a war!" Long argument led to A. V. Roe's suggested economics for the scheme-social credit and all that. Again the question "Why aren't such obviously good schemes in operation?" My reply "Because you prefer 'freedom' to scramble over money." This led us to to A. V. Roe's reasoning as a production engineer.
It takes many man-hours to build a large aeroplane, and a vast amount of man-hours is used up in preliminary work, design, toolmaking, planning, prototyping. The break-even point requires the sale of 60-80 such machines, and to make a profit commensurate with the skill and enterprise involved requires a sale of hundreds, even thousands. It ought to be in production for ten years or more. The military market is, unfortunately, almost the only mass market for this industry. Roe deplored this, as do we all. "Every bomber could be two airliners for us."

Military requirements demand secrecy – 'security'. This leads to massive propaganda to condition the taxpayer into providing the money. So we find an industry in which the highest manual and technical skills are necessary, prostituted to the art of war.

The actual building of aircraft demands teamwork of the highest order. Design and study groups are assembled, draughtsmen are grouped according to their special knowledge, new men are absorbed, who, in turn, absorb knowledge from the groups. Next come planning groups who break the overall design down into production schemes. Each group consists of a nucleus of older men of wide experience around whom young men and apprentices are gathered. Teams of estimators work out costs, teams of technical and commercial experts order components from outside specialist firms, who in turn have to design, plan and order their work. Highly expensive machines, jigs and tools have to be ordered, sometimes years in advance of production. The co-ordination of such diverse teams calls for human understanding of a very high order. It is rarely autocratic, but there are of course men of acknowledged eminence who make 'sticky' decisions. This is
akin to an orchestra accepting the authority of the conductor. While this vast enterprise is taking shape, drawings are percolating onto the workshop floors. Here the "detail-fitting" group reproduces in metal the most amazing geometrical forms. These men are individualistic pieceworkers but are well aware of the strength of their position and usually combine in maintaining high standards of pay and conditions of work. "Details" now go to "sub-assembly" gangs who combine them into a "structure" which will form with other "structures" a major components of the aeroplane. These are then built into the complete aeroplane by groups of men with long experience. The shop floors continually come across faults and inadequacies in drawings and these are "flagged back" to the design office for amendment, the worker here being the necessary practical corrective to the theoretician.

The main bulk of the work is done, as can be seen, by groups – thousands of technicians and thousands of workers. Liaison is the work of individuals of outstanding ability. Whether a gang system is officially in existence or not, the grouping is the same. Firms who operate the gang system of piecework are almost invariably in the lead in production of aircraft as each gang is a self-sufficing democratic unit, a business within the larger business. But it is also more – it frees men's minds of financial worry and thus enables them to specialise as well as to co-operate. No man works against another because his good is the general good of the gang. Money matters are the concern of everyone because all are equal – the details are taken care of by the ganger and the shop-steward. The "share-out" list is published to the gang weekly. Most men with experience of a modern gang system are reluctant to return to individual piecework or to a fixed wage. On gangwork the initiative is with the men on the shop floor – they have to earn their money – they scheme, devise and invent continuously to speed-up the job, to enhance earnings, to make the job easier and to win shorter working hours. Men on "daywork" (fixed wage) have to be driven by foremen – men on individual piecework drive themselves – gang workers are a team who share equipment and money, and have a common attitude and understanding. All three methods will be found on a large aircraft building plant.
Aircraft building is probably the most complex of all manufactures because it is never static, new inventions and ideas being thrown up continuously. It combines the highest technical knowledge and skill with the most exacting workmanship. Every operation (and there are millions) could, if performed badly, be a cause of disaster, and every man knows it. Men soon come to accept that gang work is normal, that they can forget greed, that it takes all sorts to make a gang, and that individualism and collectivism can work side by side decently.

Team work on the management side is still marred by predatoriness – middle class ambition. The shop floor is kept clean of this by full publication of gang accounts, by all decisions being made by the entire gang or shop, and by collective disapproval of anti-social deviation. An individualist who cannot conform usually ends up on piece-work – on his own. The sociological significance of such developments in social engineering is that our industrial society is transforming itself from within. Just as capitalism arose "in the gaps" of the earlier land-owning and farming system so today a new order and method is arising from the bottom. It is resisted by some, not written about, ignored by the professional planners and inspirers. These dream up visions of white-coated university-trained experts (themselves!) pressing electronic buttons that will make workers unnecessary or subservient. The reality is different. Automatic machinery and processes are just the end result of a vast apparatus of creative work along the lines I have described. A self-operating plant, marvellous as it may be, has merely put the real work further back, out of sight. It was organised in work, by hand, skill, and brains.

Unskilled labour is fast being abolished. Even on building and civil engineering jobs the first thing done is to elevate 'labourers' into machine drivers and material handlers – with enhanced pay. Gang work, in its modern sense, is increasingly used, to the benefit of both sides. A new road is wanted – quickly; "Mad Michael" and his gang arrive. They are tough, hand-picked Irishmen. Machines are there, the earth is torn up, levelled, drained, concreted and finished in record time. "Mad Michael" moves on, and along the road the regular house-builders follow. These men are self-selected – in pubs. They earn big money – and spend it! The nucleus of such a gang is permanent. Such gangs are to be found all over the world.

I once had office control of such a job. The plasterers' gang comprised 20 plasterers and 10 labourers. They had been a gang for years, run by their own foreman. They 'carried' an old plasterer who should have been retired, but 'couldn't afford it'. These men plastered miners' houses at great speed, and the old man followed up cleaning up defects. One day the 'agent' in a fit of spleen, sacked the old fellow. Instantly the foreman came to me and demanded the cards of the entire gang – his own as well. I knew the firm could not replace them and phoned head office. The old man was re-instated after a hell of a battle. The foreman told me, "That old chap is one of the finest plasterers alive. Some of the best ornamental plaster work in London was done by him. He taught me my trade. Anyone touching him touches me – and my lads. And if by any chance I should be as badly off as he is at that age I should expect the lads to carry me – and I know they would."
I admired these men.

This is an example of a common phenomenon: that at the back of almost every strike there is someone who thinks he alone knows. Strikes often appear to outside people to be about trivialities. Middle-class people conclude that the monetary gains that the men may get from a strike are also trivial, or that they have lost on the deal. Nothing of the sort. The men know that there is hostility somewhere above, and when breaking point has been reached, that someone has to be taught a lesson. It may be one man, or it may be the general feeling among managers who want what they call a 'showdown' It can be political. Sometimes it is an obsession with a new system that is intended to make men conform. Whatever it is, the men know that they must give the lesson, for themselves, now, for other workers elsewhere, and also for the future. This is of course a negative attitude, but 'educating the gaffers' has been the continuous method by which the workers have raised themselves right from the earliest days of industrial degradation. Unless they continue thus, they would be pushed back, bit by bit, and they know it. The trade unions and the internal system in industry are but the frame in which men work. Their real feelings only break through occasionally – but they are always there ready. Their creative life at work is different, is slowly gaining, eroding old-fashioned capitalism. In fact employers and managers sometimes complain to me "There seems to be no end to the things these men want. Where will it end? They will soon be demanding the lot!" Sometimes I reply "Yes – the lot." The process is not usually thought of in the terms in which I have stated it, but it goes on, continuously.

In the Coventry car factories there has been an uphill battle from 1914 war days onwards, to build shop-floor organisation, and method. Shop stewards were in wartime, practically illegal and were persecuted for years afterwards. Great industrial battles were fought in the 1920s but men soon realised that something more than rebelliousness was required. So the battle was transferred to the shop floor. We fought while we worked and were getting paid, for strikes, unless imperative, were a dead loss. Our method was non-co-operation with any foreman, charge-hand, or rate-fixer who was a swine. Some whole firms were swinish. Our means were always subtle and drove supervisors mad. It was a desperate period for many men as we had been severely beaten in a three-month lockout in 1922 – but, personally, I enjoyed the fight.

But there were other firms. In these, production engineering was being systematically applied. Coventry was peculiarly successful owing to the bicycle boom of 1880 to 1900, when line-production of precision-made parts had been highly developed. This skill and method easily progressed from bicycles to motor-cars. It was inevitable that someone would eventually, gather together enough resources to satisfy the ambitions of designers, production engineers, workers, and customers. By 1922 Morris Motors in Coventry had installed a hand transfer machine, in 1923 a fully automatic one – the first in the world. Continuous production by specialised machines, tools and methods attracted men away from the "swinish" firms – wages went up and hours went down. Other progressive firms, unable to afford such vast and expensive plants, achieved similar results by enlisting worker co-operation with high piecework earnings – "flogging the plant". It was soon found that piecework was advantageous, that a "line" was a team, and that the gang system kept men together, and happy. There were battles, and from all this a new outlook developed. The dictatorial gaffer was told to go to hell and increasingly men ran the job themselves. Immense improvements in working conditions were brought about by erosion, by wearing down outmoded thought. And all this was achieved in a period when the car trade was seasonal – overtime all the winter stocking-up parts, short time and unemployment in the summer. Ideal for those who valued their health!
Before 1939 there were at the Standard works 68 rates of pay. In wartime this was reduced to 8. The pre-war gangs of 8 or 9 men were now increased to many hundreds. After the war the management asked the men to establish the minimum wage on which a man and his family could live in Coventry. The figure later became the minimum, a datum line. Above that, piecework, by gangs, gave the highest pay in the industry. A vast amount of argument and negotiation stabilised 15 gangs for the entire car works. Skilled toolmakers were classed A, craftsmen B, skilled production workers C, semi-skilled D, right down to tea-makers and cleaners. Inside each gang and category all were equal as people and in pay.

The workers increasingly ran the job themselves, made mistakes, and learned. From time to time however the autocratic mind tried to re-assert itself and strikes resulted. These were settled in hours with all cards on the table. Sometimes workers demanded impossible things – impossible within the structure of capitalism that is. These episodes were used as Conservative anti-worker propaganda, and it was common to hear Captain Black, the then head of Standard, denounced as "pink, if not red! "

The initiative in both car and tractor plants came from the shop floor – all else was "a service to production". So successful was the scheme that there was quite serious discussion on the Trade Unions themselves running the entire production. This idea was abandoned – maybe from fear of the political mind – of all kinds. The Standard Company had preserved its freedom to carry out this social experiment by withdrawing from the Engineering Employers Association. The gang idea was carried further towards workers' control that anyone else had done to date. It paid, on both sides. As Standard forged ahead and set the standard of pay for Coventry, so other firms were obliged to follow. Morris Motors had already, before the war, established similar methods, but there was, and still is, more individual piecework. Similarly with Rootes and Jaguars. Mixtures of gang-work and ordinary piecework are quite common in other works, but which ever system is used the initiative is usually from the bottom. Some men fail to cohere and never succeed as a gang. Many firms now prefer gang-work as it simplifies administration and reduces overhead costs.

But success goes to people's heads, and capitalism is still capitalism. Markets became bigger, output soared, and as greater demands were made on the plant it became obvious that more automatic methods would have to come. This time the managers really got bigheaded and their "show-down" came when the Ferguson tractor was changed over to a new design and a new methodology. Other firms, wisely, changed over discreetly and managed to "carry" their men, but Standard, under their new chief Alick Dick, shed their men – hence the so-called "automation" strike. The affront to the men consisted in withholding information and dismissing with indifference all ideas from below. This delighted Conservatives everywhere, but was in fact a stupid reversion to an outmoded attitude, an attempt to break a social process that had developed for a generation or more. Workers who were still busy on cars that were selling well struck work. This was a shock, completely unexpected. Lesson 1 for Alick Dick.

In a few months the tractor plant started up again, and full co-operation from the men was expected. It was not forthcoming until Alick Dick put all his cards on the table: Lesson 2. Later he tried another "show-down" and sacked 117 men from the Triumph Herald body line. The entire press of this country rejoiced: at last managers were asserting authority. This was short-lived. The men had to be taken back and were paid for the 3 days they were sacked. They did not make the headlines, it was a workers' victory. But it was Lesson 3, and further lessons are proceeding.*
All this is a leading part of a historical process, the growth from below of new ideas and methods, assisted of course by first-rate production engineering. At the moment it looks as though the car trade may again become seasonal, with the off-period in the winter instead of the summer.

Coventry's gang system has been peculiarly successful and pays the highest district-average wage in the country – earned. Volkswagen, re-started under British auspices after the war, had developed the gang system in the same way. In Jugoslavia it is developing with distinct success, probably learned from Coventry as that country is one of Ferguson's best customers for tractors, and has sent many study teams to this country to pick up methods.

Some people may think that the Coventry workers' achievements will be defeated as new techniques advance, but I doubt it because men's experience of the gang system goes with them, and they feel affronted by the methods of an "old-fashioned shop". They at once become propagandists for a measure of workers' control. New techniques will demand ever-increasing skill which can only develop in an atmosphere free from frustration and niggling over money. Cheap, poor, degraded labour is fast being replaced by automatic processes – machines can do all the drudgery well, without tiring. Our next move in the advanced industry must be for shorter hours. Decent ways of spending leisure must be provided for. (The motor car itself is now a nuisance. Years ago some of my more wealthy friends were motoring enthusiasts and delighted to tell me of the beautiful houses and gardens they visited. I always retorted "Why not have a beautiful house and garden of your own?" It sunk in eventually, and it will with our present motor maniacs).

*See note at end of article.-ED).

Many workers ape the falsities of the middle class, and others are poor creatures. I know, I live among them. But workers do practice loyalty. The gang idea is their idea and it cuts across ideologies and ignores drivel. To a large extent it ignores money, or at any rate the continuous niggling over money. In car factories they don't bother to count parts – these are just shunted into the system and come out counted in complete cars. A few get pinched, but that would happen anyway. The same in some large stores – millions of pounds are saved by not counting. The paperwork is abolished as silly.

People who decry the technical world do not realise that advanced techniques are basic necessities for a life for everyone. But we allow ourselves to be bogged down by a stupid monetary system that wastes resources. Capital profits and take-overs and similar fiddles continually turn capital into spending money which creates markets for every form of parasitic production. The bomb and the tools of war are parasitic, so are the insurance companies, landlordism, advertising, the press and the paper-scraping "work" of the city. We in production know that a major part of our effort is literally thrown away. We develop production as a social process only to find an ever-growing anti-social parasitic population against us. The extension of higher education now being planned and organised is expected to take care of the vast increases in production that will be required, but it remains to be seen whether these new young men will be satisfied to be technical cows subservient to parasitic authority or whether they will come round to our view.

Because large fortunes are now being made out of new drugs and chemical processes, new gadgets, inflated land and share values and so on, it is assumed that such affluence will continue. But such things are in the long run self-defeating – looting. A small proportion of the population can loot continuously but when the scale becomes immense it calls for a day of reckoning. The looters will have looted their own system to death. Some of them realise this, which is why they buy gold, diamonds, land and art treasures – all nest-eggs, just in case.

And yet we have such immense potential resources that our own country could be made fit for all its inhabitants to live in. And we could have the surplus energy to help the backward countries. Economics, the science and liturgy of scarcity could be abolished. We could, like production engineers, work out the man-hours available and arrange for people themselves to put them to their own good use. Already we have gangs, groups, teams, whatever they may be called. There are voluntary bodies in every possible sphere, from sport to art. The professions run their own show and set their own standards. People everywhere, every day, help each other without question. Capitalism is parasitic on all this. It has already been eroded – in bits. When are we going to start putting the bits together?

Editor' s Note:
SINCE REG WRIGHT'S ARTICLE WAS WRITTEN, some interesting things have happened at Standards in Coventry. Mr. Alick Dick who, after he took over from Sir John Black as chairman of the firm declared "We are happy that we have re-established the most fundamental principle – management's right to manage", has been "resigned", together with six other directors, by the new controllers of the firm, the Leyland Motor Company, who made a successful £20,000,000 take-over bid for Standards earlier this year.
It was reported in the Evening Standard (22/8/61) that Mr. Dick was expected to receive a "golden handshake" of around £30,000 (rather different from the £15 severance money paid to 3,500 Standard workers discharged in 1956 when the tractor factory, subsequently sold to Massey-Ferguson, was closed for re-tooling).
In the following week Leylands dismissed a large number of "executives and staff in the £40-£60 a week bracket". One of the executives said to the Daily Mirror's correspondent (30/8/61) "If one man on the shop floor was fired there would be a strike because they are organised. About 200 of us will go and nothing will happen." One is tempted to comment "Well, whose fault is that?" because the essence of the management side, as Reg Wright notes, is middle-class ambition, while that of the workers' side is working-class solidarity. Confirmation of his opinion comes from the book about Standards, Decision-Making and Productivity (Blackwell 1958) by Professor Seymour Melman, who notes that

Within the management hierarchy the relationships among the subsidiary functionaries are characterised primarily by predatory competition.
This means that position is gauged in relative terms and the effort to advance the position of one person must be a relative advance. Hence, one person's gain necessarily implies the relative loss of position by others. Within the workers' decision system the most characteristic feature of the decision-formulating process is that of mutuality in decision-making with final authority residing in the hands of the grouped workers themselves.

The "resignations" of directors and the dismissal of staff are seen as the prelude to further dismissals of Standard workers. Leylands, the new owners, are of course makers of heavy commercial vehicles, and when they took over control of Standards it was with the avowed intention of forming a group capable of producing every kind of motor vehicle, though, as The Economist commented, "When you remove all but one of the directors who have any experience of the car business from the board of a motor company, the obvious inference would be that you intend, sooner or later, to stop making cars."
In the light of Reg Wright's views the coming struggles at Standard are of the greatest interest. Leyland, a Lancashire firm, competes for labour with the declining low-wage cotton industry. Standards have been paying the highest wage rate in Britain, and The Economist observes that

The power of the unions in Standard-Triumph International, another characteristic of the motor industry and one that was encouraged by Sir John Black, must also come as a shock to a Lancashire employer whose paternalism is still authoritative; and again those who have grown up to live with unions in this way must view the chances of changing it rather differently from people who are shocked by the whole idea.

There is yet another aspect worth thinking about. Melman's study noted that the existence of two inter-related decision-making systems at Standards – those of the workers and those of the management had very important consequences. He observed that (and this is important in considering Reg Wright's remarks above about "looting" as well as the alleged reasons for this country's current crisis over productivity) "in England during the last decades the manpower cost of managing manufacturing firms has been rising more rapidly, than the growth of productivity". But at Standards in unique contrast to the rest of the motor car industry the "administrative overhead" declined over the period 1939 to 1950, while that of every other firm in the industry and for manufacturing as a whole, increased. The reasons for this are given in Reg Wright's earlier article The Gang System in Coventry in ANARCHY 2. Standard's advertising expenditure per car sold is said to be "modest" in relation to that of other manufacturers.
Yet Standard's overhead budget is described as having shocked Leylands. The Economist again comments:

The methods used to sell and to produce cars are utterly different from those of a firm like Leyland making and selling the heaviest and most expensive types of commercial vehicle. This may have provided further grounds for disagreement: the amount spent by a car manufacturer on advertising and selling its products may seem exorbitant to anyone used to building to order for industrial concerns, instead of turning out cars, en masse and then persuading the public to buy them. Selling organisation and advertising might seem to the lorry maker a logical point at which to start cutting overheads, but the car maker would regard such a policy as disastrous.

From this point of view Leylands are a more "rational" firm than Standard who in turn are more rational than their larger competitors. But in capitalist industry, rationality and production-orientedness are not the guarantees of success.