The Contradictions of Unions: Reformist and Radical Assessments

Steven Tufts, in an article first published on Wednesday, September 11, 2019, on The Star website, and republished on the Socialist Project website on September 25 (Pension Plans Should Not Invest in Companies That Harm Working People), tries to show that, despite unions consciously disassociating themselves from investments that harm workers, their own pension fund managers may pursue policies that contradict such conscious disassociation.

(As an aside, Professor Tufts is a representative of the Toronto Airport Workers’ Council (TAWC).

He writes:

For example, Caesar’s Entertainment partnered with Oxford Properties, the real-estate investment arm of the Ontario Municipal Employees Retirement System (OMERS). Community groups lead by No Casino Toronto did successfully mobilize against these proposals, which divided council at the time. Members of CUPE Local 79 also deputed against the proposals as front-line city workers would have had to deal with the negative social and economic impacts of gambling.

At the same time, fund managers at OMERS, the pension fund of Local 79 members, deputed on the economic virtues of casino development. Here we see the contradictions of pension fund investments that negatively impact the very workers making contributions.

However, Professor Tufts does not question how unions can escape this situation. Pension funds generally have to invest money in some capitalist companies, and those companies are expected to obtain a profit. If this is the case, then there is a typical social-reformist strategy of opposing particular kinds of investments or particular kinds of employers while implicitly accepting the need for capitalist investments in general or the need for a set of employers.

In other words, does not any investment “harm workers?” Professor Tuft remains silent on how workers can escape this contradiction. Of course, there are degrees of harm of workers by employers, with some employers definitely treating workers worse than other employers. However, do not all employers harm workers by necessarily treating them as things to be used to obtain more money (private sector) or by excluding them from the right to determine the purpose of their work (public sector)? (See The Money Circuit of Capital).

Professor Tuft further states:

All workers deserve pensions, but pension funds for some built on tax cuts and privatization schemes are neither just nor sustainable over the long term. Unions continue to shield themselves against efforts to politicize pension investments, but this has a cost.

This criticism aims at the neoliberal model of “tax cuts and privatization schemes.” What if the pension schemes did not rely on such tax cuts and privatization schemes? What happens if they relied on merely–exploiting other workers in a non-neoliberal way (as they did before the emergence of neoliberalism)? Would that eliminate the contradiction between workers’ interests as workers and their interests as future retirees? I fail to see how it would.

Indeed, Professor Tuft states:

It is time for union leaders to confront pension plans that seek to transform our cities in ways that harm working people.

Surely, all pension plans, whether private or public, are riveted with the basic contradiction of being funded by workers while being used to exploit and oppress other workers. This contradiction cannot be abolished without abolishing the situation where a class of employers exploits and oppresses a class of workers called employees.

If this basic contradiction is acknowledged, then variations in levels of harm to working people can then be assessed. However, as it stands, Professor Tufts’ article implies that there can be “pension plans that seek to transform our cities in ways that” do not harm working people. Such a view is typical of reformist policies that fail to address the harm necessarily caused to workers because of the existence of a class of employers and the accompanying economic and political structure.

By not acknowledging the general harm that all employers pose for working people, Professor Tuft does not acknowledge the need to create organizations that oppose the class power of employers as such.

Obviously, some employers are better than others. However, the social-democratic left never get around to criticizing employers as such. They remind me of movies and television programs. Often, particular police officers or particular companies are presented as bad–but not the police function as such or employers as such.

Despite Professor Tuft’s evident desire to go beyond the limitations of union principles, he evidently operates within them implicitly since he assumes that workers’ pension plans can somehow magically overcome the contradiction of exploiting and oppressing workers by not following the neoliberal model–as if the capitalist relations of exploitation and oppression did not exist before the emergence of neoliberalism.

Should we not go beyond the limits of neoliberalism and challenge the economic and political power of the class of employers?

Basic Income: A Critique of the Ontario Coalition Against Poverty’s Stance

In the pamphlet published on the Socialist Project website, Basic Income in the Neoliberal Age (Toronto, 2017), the Ontario Coalition Against Poverty (OCAP) implies that only a social-reformist vision–maintaining the welfare-state–is a viable option; it implicitly assumes that going beyond it is not viable. Its argument combines both a realistic assessment of the impossibility of an adequate universal basic income for all as long as the power of the class of employers exists, and an implied conservative call for maintaining the existing welfare state rather than going  beyond it.

It–correctly–argues that we should be very skeptical of proposals for basic income originating from liberals and conservatives (and, it should be added, the social-reformist left). Those who believe in an economic system characterized by a class of employers are hardly going to break the link between having to work for an employer and receiving an income. Indeed, as OCAP argues, the current benefits that the government does offer would probably be substantially reduced or eliminated and replaced by a basic income that was even more inadequate than current welfare and other social assistance rates.

However, the skepticism about implementing a basic income scheme that is acceptable to the class of employers is illegitimately extended to skepticism about its viability for a movement that seeks to go beyond a society dominated by the power of the class of employers. They write,

page 6:

These kinds of left advocates are easily able to show how providing a
universal adequate payment, while maintaining other elements of social
provision, would weaken or even eliminate the basis for exploitation of the
working class under capitalism. However, where they uniformly fail is in
the not unimportant area of showing how this is all possible. Capitalism
needs economic coercion for its job market to function and decades of
neoliberal austerity have intensified that coercion considerably. With
trade unions weakened and powerful social movements conspicuous by
their absence, it is doubtful that a major social reform, such as the
proponents of progressive and transformative BI advance, is likely.

At least this paragraph realistically argues that “Capitalism needs economic coercion for its job market to function.” Let us stop at this sentence. If capitalism indeed requires economic coercion if the job market is to function, then should not OCAP be advocating for the abolition of such coercion?  That such a process requires a movement with substantial organizational power goes without saying, and that will take time, energy and much organizing and debating. Of course, this requires a desire to orient social movements towards abolishing the power to coerce, but OCAP is silent about what to do about this coercion that many experience on a daily basis at work (which, of course, spills into situations outside the workplace). Should not OCAP address what it itself admits is characteristic of a society dominated by a class of employers?

OCAP excludes any discussion at all in the document about what is to be done about economic coercion (aka economic blackmail). Its critique of basic income presumes that economic coercion is the order of the day–that there is no alternative–except to maintain the current welfare system, flawed though it may be.

OCAP uses the fact of the weakness of trade unions as a reason for opposing the principle of basic income. Surely one of the reasons why trade unions have become weaker is because they have failed to question the coercive power of employers as a class. For example, John Cartwright, president of the Toronto & York Region Labour Council, in his open letter of January 30, 2018 ( An open letter to our movement) , wrote the following: “We need to fight for labour law reform including broader based bargaining so that precarious workers can have a vehicle in which to achieve dignity and economic justice.”

If, however, economic coercion or economic blackmail is required in the kind of society in which we live, how is it possible to “achieve dignity and economic justice”? If such rhetoric has contributed to the current situation, then should not its criticism form part of the solution? Does OCAP take a stand by taking seriously its own assertion that economic coercion is a necessary feature of the power of employers as a class by criticizing union representatives who talk of economic justice under such dictatorial circumstances?

Throughout the whole document, there is nothing that links this requirement of capitalism–needing “economic coercion for its job market to function”–to the need for a movement that goes beyond such economic coercion.

Ultimately, as noted above, this document is a social-reformist document–a document that has no better solution to “economic coercion” than implicitly proposing that we return to the so-called golden age of capitalism, where employers had accepted, within limits, the need for a mor generous welfare state. OCAP does not explicitly state this, but it implies it.

Would it not be possible to propose a basic income that cannot be satisfied within a structure defined by economic coercion or economic blackmail? The document does not even refer to such a possibility.

Logically, if OCAP takes seriously the view that “Capitalism needs economic coercion for its job market to function,” should it not redefine the nature of poverty? Should not the definition of poverty include taking into account this economic coercion? Does OCAP do so?

In another post, I will refer to an author who does indeed take seriously OCAP’s view that “Capitalism needs economic coercion for its job market to function” and proposes a redefinition of poverty. In that post or another post I will also refer to a proposal for a radical basic income as part of a movement for a different kind of economic, social and political life–a life not characterized by economic, social and political coercion.