Cosmopolitans and locals

The recent European Parliament elections yielded some striking results, with nationalistic and far Right parties doing especially well, notably in the UK, France and Denmark. In Greece, it was the far Left that did best, but here, too, the theme was one of hostility to the EU. Some of the commentary about this has been rather hyperbolic, forgetting that the turnout in these elections was usually quite low. In the UK, the anti-EU Party UKIP topped the poll, but given the turnout this meant that less than 9% of eligible adults voted for them. Since this was at the most propitious time – an EU election, rather than a national election – and after a great deal of publicity this does suggest that pretty much anyone minded to ever vote for UKIP did so now. Thus overall support is not huge.

But, still, the results mean something and I think that that they are mainly understandable as an inchoate response to neo-liberalism. It is noteworthy that both UKIP in the UK and, especially, the FN in France articulated programmes which were in many respects leftist, for example in terms of the protection of public services and, even, nationalization. They positioned themselves as critical of big business elites, established political elites and dominant metropolitan elites.

There is nothing very new about this. Far right parties have always sought this kind of populist appeal, and have been able to gain some working class support and, more especially, support from those on the fringes of working and middle classes – Poujadism in France being a relatively benign example, National Socialism in Germany a much more toxic one (it bears saying that neither UKIP nor even the more extreme FN, for all that they have elements of racism, can be considered to be comparable to the Nazis).

It is not difficult to debunk this positioning. UKIP, for example, is at heart a party of the Thatcherite Right, and (although its policies are not always very clear) is hostile to employee rights and the NHS. But that isn’t really the point. The policies are less important than the tone and the idea that, somehow, these parties stand against elites of all sorts and speak for ‘ordinary people’. That may be – in my view is – completely untrue, but why is it so appealing at the moment?

The answer lies in the way that globalization, of which the EU is a prime example, has eroded democracy and made political accountability virtually impossible. Immigration becomes the focus for this because it is by far the most visible consequence. Yet it would be absurd to respond to globalization simply by limiting immigration, and certainly to do so in the name of anti-elitism. All such a move would do would be to ensure that corporations could move around the world at will, but workers would have to stay in one place and take whatever employment was given to them. To be consistent, an anti-elitist politics would have to limit capital mobility as well as labour mobility, but there is no suggestion, least of all from UKIP, of wanting to do this – it is really only the Greens who have a consistent position on this.

What has opened up, then, is a new political configuration in which the internationalist Left and the globalizing Right have come to share some common viewpoints, in opposition to traditionalist elements of both Left and Right. That is why opposition to the UK immigration cap on non-EU migrants, and to the idea of British exit from the EU, can be found as much amongst City of London financiers as bien-pensant Hoxton hipsters. And complaints about immigration and a desire to leave the EU can be found as much from harrumphing Home Counties Colonels who were traditionally Tories as benefit claimants in North England towns that were the traditional Labour territory.

A good way of describing this cleavage is to adapt the terms coined by the organizational sociologist Alvin Gouldner in 1957 – cosmopolitans and locals. Adapted to this context cosmopolitans are educated and skilled, comfortable with different cultures, travel widely and have a global frame of reference. Few of them will have voted UKIP or FN. Locals are poorly educated, travel little, feel uncomfortable with difference and have a national frame of reference. Many of them will have voted UKIP or FN. What economic globalization, unaccompanied by democratic political globalization, has done is to exacerbate and deepen the polarization between these two groups in ways which have hitherto had little political representation because political parties traditionally cleave on class lines rather than on the global-local axis.

The best way for locals and globals alike to co-exist is to create a more internationalised democratic polity. The locals because it is the only way that their voice can effectively be heard; the globals because it is the only way to make their views legitimate. And all of us, because given that there is no prospect of global capitalism being re-nationalised we need political structures to regulate and control it. The irony is that, as regards the EU elections, what the revolt of the locals is most likely to achieve is less not more international governance and more not less marginalization of local concerns.

Today is the 70^th Anniversary of the D-Day landings, one of the major contributors to the defeat of Nazi Germany’s occupation of Europe. Out of that defeat grew the remarkable, and at the time quite unpredictable, thing which has become the EU. Imperfect as it is, it still represents the best chance for people in Europe to modify the twin evils of nationalist intolerance of globalism and corporate indifference to localism.

The playthings of our leaders

There is a big political row about the US drug company Pfizer’s bid to buy its British rival AstraZeneca. It is interesting that it is a row because for at least three decades it has been claimed in Britain, at least, that ownership does not matter and, as I discuss on pp. 106-7 of the book, there has been a wholesale sell-off of what were once British companies (other countries, including the US, have been somewhat more wary of seeing ownership drift offshore). We have thus had the bizarre disjuncture in political discourse of constantly bemoaning the relatively limited international mobility of labour – immigration – whilst cheerfully accepting the complete mobility of capital. The Pfizer bid has suddenly galvanized an understanding that ownership does matter, because (in this example) there is very little reason to think that Pfizer will care much about nurturing the UK’s science and R&D base, which are widely seen as vital to the national economy.

There is an added poignancy to the situation of AstraZeneca, because it arises out of the case, discussed in the book (p.110) of ICI as a classic example of the disastrous ‘financialised’ organization model of the new capitalism. An excellent article by Aditya Chakrabortty this week tells the story:

“AstraZeneca was originally the corporate child of ICI, which was once Britain's largest manufacturer of everything from paints to betablockers. Then came one of Thatcher's favourite wheeler-dealers, Jim Hanson, who, in 1991, put in a bid to take over the conglomerate and break it up. That approach got bogged down in scandal – but ICI's executives did what Hanson wanted anyway and smashed up the company. The drugs arm was sold to the Swedes, the pesticides division flogged to the Swiss, the dyes part to the Dutch and the adhesives and electronics materials finally parcelled out to the Germans”.

Whether the Pfizer bid will spark a belated recognition of the importance of ownership remains to be seen but, in a sense it is too late for, as Chakrabortty points out, in the meantime the British manufacturing and research base has been eviscerated.

Meanwhile, in another corner of the neo-liberal wasteland, I noticed this week that the former head teacher I discussed in my post The New Barons last June has been banned for teaching from life because of her fraudulent activities. As I said in my original post, this arose because of the idea that ‘leaders’ should be set free from bureaucratic constraints but such freedom carries grave risks, as Steve Richard’s article on this fiasco also explains.

It’s been nagging at me today that there is something that links these two stories. Most obviously, both are outgrowths of neo-liberalism as applied to, respectively, industrial policy and public sector management. But beyond – or perhaps related – to that is the way that both arise from the separation of power and responsibility. Our companies (and with them our jobs), our schools (and with them our children’s education) seem in some way not to figure as real or important. Instead, they are the plaything of our leaders. So whereas neo-liberalism purports to empower the customer or consumer in fact it does no such thing: it enacts, enshrines and endorses the power of elites.

The end of the end of history

The ongoing crisis in Ukraine serves as a reminder of the ways – some naïve, some triumphalist – that the collapse of the Soviet Union was misunderstood in the West.  For some, it represented, simply, a victory in the Cold War precisely as if that had been a war in the conventional sense, with a determinate winner and loser. More grandiosely, as in Francis Fukuyama’s 1992 book The End of History and the Last Man, it represented the universalization of western liberal democracy as having displaced and superseded all other political forms. At all events, the temptation was to see a period of history as being ‘over and done with’ and a new era as having emerged. But, of course, history is never like that.


The rapidity with which the post-Soviet space was re-negotiated and the consequent expansions of NATO and the EU eastwards made it hard for those in the West to understand how catastrophic it seemed to some, perhaps many, in Russia and elsewhere – it is this sentiment which Putin speaks of and to. Similarly rapid was the post-soviet economic transformation which, in the 1990s, witnessed a scale of neo-liberalization that was unprecedented. The consequences of that, too, are now in evidence, in particular in terms of the dominance of Russian oligarchs whose wealth is largely traceable to the mass privatizations of the 1990s.


It is difficult to disentangle the relationships between the Cold War and the study of management and organizations. As James March’s (2007) overview of the history of organization studies suggests, much of the basic knowledge in the subject is to a remarkable extent a Cold War artefact in the sense that its heyday in the US in the 1950s and 1960s was both formed within and was a response to Cold War concerns – game theory being an obvious example. More diffusely, management in particular was seen as part and parcel of Western economic dominance and, indeed, one of the features of post-soviet neo-liberalization was the sudden explosion of teaching of western management techniques in those countries. Thus in March’s account, organization studies in this post-1991 period could be understood in terms of “the triumph of the markets”.


In international relations, Ukraine perhaps symbolises (although, of course, not uniquely) a clear end to that initial period of post-Soviet history in that any idea of a uni-polar world is manifestly no longer sustainable, as the evaporation of the territorial guarantees given to Ukraine in the 1994 Budapest Agreement shows. If it is right that organization studies (like other intellectual endeavours) in some measure reflects, is shaped by and, of course, contributes to the broader geo-political terrain within which it operates we might expect a more ‘multi-polar’ discipline to be in the process of emerging. If that is so, then perhaps we would expect not so much a proliferation of ways of understanding organizations (that has long been the case) but increased interest in the multiplicity of ways of organizing. All of which is a long-winded prelude to saying that in the book (p.119) I refer to one example of such interest as being a then unpublished work which has since come out. It is The Routledge Companion to Alternative Organization (2014) and I would recommend it to anyone interested in thinking more about the rich variety of possibilities for organization that are available to us once we realise that, indeed, history did not end in 1991.


References


Fukuyama, F. (1992) The End of History and the Last Man. New York: Free Press.
March J. (2007) ‘The Study of Organizations and Organizing since 1945’, Organization Studies 28 (1): 9-19.
Parker, M., Cheney, G., Fournier, V. & Land, C. (eds.) (2014) The Routledge Companion to Alternative Organization. London, Routledge.

Reflections on power

I have been re-reading George Orwell’s novel Nineteen Eighty-Four which I refer to in the book (pp.71-2). This I think is a particularly incisive fictionalization of organization, more particularly totalitarian political organization, and I suppose that no novel, except perhaps Kafka’s The Trial, has so insinuated itself into popular consciousness of ‘organization theory’.

The theme of totalitarianism is a tantalising one when thinking about organizations, because such arrangements seem to represent ‘limit cases’ – both exaggerating but also illustrating ‘normal’ organizations. But this understanding seems flawed if we take Zygmunt Bauman’s analysis of the Holocaust (discussed in the book, p.23) seriously. For this implies not that totalitarianism or, more specifically, the organization of the holocaust was an anomaly but that it was an expression of a pre-existing and omnipresent tendency within modernity. Bauman’s analysis seeks to draw a continuity between modern and ‘holocaustic’ modes of the social, and, within that, modern and holocaustic modes of, specifically, organization are central. For the capacity to organize genocide industrially seems to be central to Bauman’s thesis that the Holocaust was a modern phenomenon. Specifically, it represented the ultimate triumph of instrumental rationality – the deployment of morally blind means towards horrific ends. So we can say that for organization theorists, the organization of the Holocaust should not represent a ‘limit case’ or a perversion but rather a crucial moment in the elaboration of organization.

But considering totalitarianism in terms of instrumental rationality, as Bauman’s thesis might urge us to do, is inadequate because of the particular theorisation of power which it embodies. Within instrumentalism, power has a particular meaning – as a means achieve ends. However totalitarianism entails something even worse. Theorisations of power have traditionally specified either where power comes from or what power leads to. The idea that power comes from somewhere is most manifest in the well known bedrock of organization theory: French and Raven’s bases of power. So power comes from possession of certain resources or capacities (coercion, reward, position, knowledge, personality/charisma), and there are numerous articulations of basically the same idea. The idea that power goes somewhere is present in all the various ways that power is linked to interests. Here power is used to serve some purpose – the pursuit of interests (sectoral, class, gender etc). In another variation, an interest-based theory of power might see it as flowing from interests as well as being directed towards the furtherance of interests.

What is different about totalitarian/Orwellian notions of power? This is the crucial point. Here, power is conceived of as neither coming from nor aimed towards anything other than itself. In other words, power is an end in itself. In Nineteen Eight-Four:

“Power is not a means, it is an end … the object of persecution is persecution. The object of torture is torture. The object of power is power.” (Orwell, 1949:  264)

And this was prescient if we consider Bulgarian philosopher Tzvetan Todorov’s extraordinary analysis* of ‘moral life in the concentration camps’, which I urge you to read if you have not done so, where he says that:

“The aim of power is power; the enjoyment it offers is not of the material sort” (Todorov, 2000: 184)

Now, if we regard totalitarianism as a limit case, then this is not of general interest. But if as Bauman suggests it is an immanent, rather than an atypical, case then it is of huge interest. I think that this is so, and one way it is revealed is in the motivation of the archetypal chief executive or political leader:

Q: What motivates you?

A: I love the feeling that I can make a difference

Is this not the everyday equivalent of the totalitarian case: the point of power is (the sensation of) power itself? This sensation of power is only realizable if another feels and experiences your power, whether through happiness and pleasure or, as in the concentration camps, through pain and suffering. Clearly this contains the familiar irony (described most elaborately in Hegel’s master-slave dialectic) that the powerful are dependent upon others for their power. Revealingly, Todorov reports that the most vicious treatment was meted out to those who did not quickly enough show submission. This suggests that the full sensation of power is only possible where resistance is both met and overcome. He also remarks that this desire for power seems insatiable in that it was endlessly repeated with new entrants to the camps. In Nineteen Eighty-Four, O’Brien makes a similar point when torturing Winston Smith – both that the same scene will endlessly be played out and that the image of the future is ‘a boot stamping on the human face forever’. There is no end to power in two senses: it has no purpose and it’s work is never finished.

The poet W. H. Auden wrote, in his 1939 Epitaph on a Tyrant, as follows:

Perfection, of a kind, was what he was after,

And the poetry he invented was easy to understand;

He knew human folly like the back of his hand,

And was greatly interested in armies and fleets;

When he laughed, respectable senators burst with laughter,

And when he cried the little children died in the streets.

It is a damning indictment of those who use power, instrumentally, in pursuit of an ideal. But it is also a terrible reminder of the narcissism of power; of what happens when power has no object but itself: and when he cried the little children died.

 

*Todorov, T. (2000). Facing the Extreme. Moral Life in the Concentration Camps. London: Phoenix.

Pensions

The subject of pensions does not excite great interest. It seems boring, technical and remote. But a pension is a key aspect of work, being a form of deferred wage. Of the many inequalities opening up between young and old, access to a reasonable pension is one of the most important. Public policy in this area is quite complicated, and very long-term: decisions made now have their impact decades into the future.

This week, the British Government have decided that those in money purchase schemes will in future be free to spend their pension pots as they like, rather than having to buy annuities. There is some sense in this. An annuity means that you pay a lump sum to an insurance company in return for a lifetime of payments (but you lose the lump sum). Returns are quite low, and the crucial issue is how long you live after retiring: if it is a long time, it is not a bad deal. In a sense it is a kind of insurance product, with pooled risk meaning that those who live a long time are balanced out by those who do not. But annuities are not great value in general because the companies providing them take so much of the investment.

So this reform is being greeted as giving greater choice because the pensioner may do as s/he wishes with the pension pot. S/he might blow it on luxuries or invest it soberly for old age. What is interesting about this is that these money purchase schemes developed when, in the 1980s, the State Earnings related Pensions Scheme (SERPS) was wound down in the name of – consumer choice. Both then and now ‘choice’ is seen as the value that trumps all others.

Yet at the same time, final salary schemes are depicted as an elite ‘gold plated’ advantage, available only to public sector workers and senior executives in the private sector. Why don’t ordinary workers in the private sector have them (as they used to)? Well, because those workers decided (or were seduced into deciding) that it was better to have individual choice rather than unionised negotiations of pension rights.

Choice has been valorised in neo-liberalism as the prime – maybe the only – thing that matters. But that is nonsense, and pension provision shows it to be nonsense. The best way of organizing pensions is via collectivization of risk (in this case, longevity risk). The consequence of not seeing this is the generational gap that has opened up between those who under the ‘old settlement’ have decent pensions and under the ‘new settlement’ do not.

The temptation is to see the old benefitting at the expense of the young. But this is nonsense. It is not that the old prosper at the expense of the young but that the collapse of collective provision in the last few decades has effected a massive transfer from ordinary people to the global elite. Of course that elite would love to pit grandparents and parents against children and grandchildren. But the reason why a 20 year old today has no prospect of a decent pension is not because Aunt Nellie has a few thousand a year from her pension scheme. It is because there has been a wholesale transfer of power and wealth – by virtue of the seductive rhetoric of individual choice.

Tony Benn (1925-2014)

Tony Benn, the veteran British socialist has died, aged 88. Like Margaret Thatcher, whose death last year I wrote about in another post, he was one of the figures who defined the politics of my youth, although of course he was far less successful and influential than her. As Benn got older he morphed from his status in the right-wing press as ‘the most dangerous man in Britain’ to being considered a national treasure, in a way that Thatcher never did. That was to cease to take him seriously, but it explains why, whereas her death provoked very polarised reactions his got a more eulogistic response. Thus his death has produced a lot of, to me slightly nauseating, comment from the right about how they didn’t agree with him but respected him. In some ways, it would be more respectful for those who disagreed with him to denounce him, as happened with Thatcher.

Benn was an interesting figure for many reasons. One is that he represented a version of the left – the far left, if you like – which grew not out of Marxism but a kind of Christian socialism (it is not clear that Benn, himself, was a Christian, but he grew up in and was influenced by it and seems to have been diffusely religious). His memoir, Dare to be a Daniel (2004), in its very title as well as its content reflected this. In a strange kind of way he embodied some of the ‘Victorian values’ that Thatcher herself professed to admire: hard work, dedication to duty, moral commitment, independence of mind. But, really, the tradition of Christianity he exemplified was that of the diggers and levellers and those various strands of radical Christianity described in Christopher Rowland’s (1988) book of that name. It is a tradition quite different to the kind of conformist moralism that Thatcher evoked and sought to enact.

Another reason for interest is that he had a very strong sense of history. His diaries and memoir are saturated with an understanding of, in particular, the history of the British Labour Party, its achievements and limitations (of which – to link my two points - he remarked that it had never been a socialist party but had always contained some socialists, just as the Church of England had always contained some Christians). Again, this developed out of his childhood, growing up in a family embedded in the Labour Party. He was one of a literally dying breed of politicians who was formed by the experience of the Second World War (his elder brother was killed in it, and Benn himself served in the RAF), and by the socialism of the post-war Attlee government. As I wrote in my ‘review’ of the Ken Loach film The Spirit of ’45, the experience of war provided both a moral case for a better society but also pointed to the tools of collective endeavour and central planning that would deliver it.

These are very much organizational issues, of course, and relevant to the choices that still face us. Benn stood for a form of collective endeavour that was different (by being collective) to neo-liberalism and (by being non-marxist) to communism. And his engagement with radical Christianity is in some ways reminiscent of the kind of liberation theology that finds an echo in Critical Management Studies’ interest in emancipation. Oh, and we should also note that he was an heroic smoker - the 1993 'Pipe Smoker of the Year', no less. 

Leading to disaster

Today's post is prompted by the news that Euan Sutherland, the Chief Executive of the Co-op Group, has resigned after just 10 months in the post, saying that the Group was ‘ungovernable’. This appeared to be a reference to the unwillingness of the group to accept the more ‘commercial’ approach he advocated. Much attention has focussed on the fact that Mr Sutherland was paid £3.7M a year, more than twice that of his predecessor. To me what is more interesting (though no doubt related) is the fact that his background was in commercial retailing, his previous post having been as head of B&Q, a large DIY chain.

The roots of the Co-op group are in the co-operative movement and ultimately go back to the 1844 Rochdale Pioneers, so it was animated by a different set of concerns than those of pure commercialism. It emerged from a Victorian tradition of working class self-help that also created mutual building societies and friendly societies, as well as mechanics’ institutes and similar institutions. Most of these have now ceased to exist or changed unrecognizably in form. The fate of mutual building societies is especially poignant: as I noted on p.119 of my book, all those which de-mutualised following deregulation in the 1980s have since failed to survive as independent entities or even to survive at all, most notoriously in the case of Northern Rock which was at the centre of the British end of the 2008 financial crisis. They were done for by precisely the adoption of a conventional commercial approach.

It seems as if there was an obvious mismatch between the Co-op and its now ex-CEO but his appointment reflected one of the central tenets of managerialism (or, perhaps, ‘leaderism’): that management and leadership are generic skills applicable in any and every setting. The same kind of idea informs the recent appointment of the ex-boss of Marks & Spencer to review and advise on management in the NHS.

What is bizarre is that leadership theory since at least the 1970s has recognized what common sense might also suggest: that the effectiveness of leadership is intimately related to and contingent upon ‘situation’ or context. We wouldn’t expect a successful military leader to run an advertising agency well, or vice versa. More recently, it has been suggested that what matters is the complex relationship between leadership and followership. But, somehow, it is imagined by the supposedly hard-headed that leaders from one kind of organization can be transplanted seamlessly into a completely different setting and flourish. The inadequacies of that belief are well-illustrated by the Co-op debacle.