Neo-Corporatism Outline • Old Corporatism • Neo-Corporatism • Corporatism in Sweden • Cooptation? • The decline of Corporatism Old Corporatism • Catholic Church • Cooperation as an alternative to raw capitalism and socialism • A consensual society based on moral order rather than class conflict • Society must be hierarchically ordered because we are not equal • State should establish corporations composed of producers as regulators • Should bring together representatives of labor and capital, class loyalties would be displaced by loyalty to the profession Functioning of the Corporations • The producers should lead the corporations, because they are the most competent • The state should license them to carry out particular functions and can revoke their license if dissatisfied. • Corporations act as an intermediary between the state economic and social decision makers. • They would regulate prices, wages and oversee production. Political Representation • Corporatists were critical of democracy • We cannot live by the majoritarian principle but only on the basis of value and truth • Representation should only have an advisory function • There could be chambers with the various corporations participating • A higher leadership needed, because only certain people were capable of leading and they should be able to arbitrate to prevent conflicts Fascist Italy and Portugal • Monopolistic syndicates replaced unions. • The leaders of the labor organizations were appointed by the state and their administration filled with party-state bureaucrats. Were under state control. • The state allowed powerful industrial, commercial and agricultural interests to dominate employers’ organizations. • In practice the syndicates did not act as state-licensed intermediaries because they were controlled by the state bureaucracy. Neo-Corporatism • Strong in Nordic social democratic countries • Relatively strong in conservative Germanic countries, such as Germany, Austria, Switzerland Neo-Corporatism in Practice • Civic organizations receive a monopoly • They carry out state functions • This gives them some power and influence • But prevents them from organizing against the state Swedish Labor Market Policy • 1938: Unions and Employee associations agreed to conduct centralized bargaining • Local unions and enterprises must agree to follow the agreements • Strikes not allowed until state mediator try to find a solution • Representatives of unions on the national labor board, which runs employment agencies, etc. Swedish Unemployment Insurance • In the 1930s the social democratic-peasant alliance introduced unemployment insurance • To gain Peasant Party support the social democrats agreed to a lower level of support • The Peasant Party agreed to allow unions to run the funds • As a result many more people joined the unions, which made them much stronger Swedish TV includes representatives of: • Trade unions • Employer’s association • Swedish Church • Political parties • Journalist union • Differs from France or Italy, t ex, where the new government always replaces the heads of television stations to hire people who sympathize with them Cooptation? • Marxists argued that the state used corporatism to buy out the unions • The union leaders received special privileges but they had to give up their opposition to capitalism • They claimed that the corporative bodies normally supported capital and that the unions had no real influence • Liberals claimed corporatism gave unions too much influence Neo-Corporatist Administration • Frame laws versus rational bureaucratic laws • Plato versus Aristotles • Rational-bureaucratic as democratic • Rational-bureaucratic as totalitarian • Kadar administration as democratic and flexible • Can find better solutions if the bureaucrats can be flexible but share the same goals as the lawmakers The Decline of Swedish Corporatism • Marxists claimed that labor and capital was in equilibrium, which is why the corporatist solution came about • In the 1970s Sweden seemed to have solved all the major economic problems • Workers began demanding more influence over their work and better working conditions • This led to debates over workplace democracy, codetermination laws and funds to give workers ownership over production The Counter Offensive • The employer’s association felt threatened • Unions were no longer complacent • At the same time, the Reagan-Thatcher revolution took place • Thus they felt stronger ideologically • They began a campaign against worker funds • They began to withdraw from corporatist boards • They started demanding market liberal reforms Neo-Corporatism Today • Today formal corporatist structures are much weaker • But capital and labor have begun to cooperate more again in Sweden • Now that socialism does not seem politically feasible many leftists are nostalgic over the former corporatist structures