Richard Meredith, Lecturer in Management, examines the societal opportunities that come from the economic downturn.
This article is part of our new series, Regent's Review: thoughts, research and academic discussion on the rapidly unfolding pandemic.
Summary
- Dystopian views of the world abound because of the tragedy of the commons.
- Something new is needed, and suspending the economic sphere because of COVID-19 is the opportunity to drive a new bargain between society and business.
- Clear signs are emerging as to how social distancing might transform into economic distancing – to mitigate the spread of exploitation of shared resources by employers through globalisation.
Society needs a new economic bargain – this is our chance
The natural world grabs back scarce resources from the economic world to tackle COVID-19. This pivot is a moment to consider the determinants of harmonious social relations and redefine the commons for collective rather than individual action.
Exploited by owners of factories, the working class of the 19th century consciously crafted an identity by collective action from common interests. Ideological disruption of the bargain between labour and capital in the 1980s and globalisation in the 1990s removed the nation-state institutional control apparatus. The current US critique of the World Health Organisation in the face of a pandemic aptly demonstrates the underlying weakness in supra-national institutions.
Dystopian views of the world abound because of the tragedy of the commons (abuse of shared resources) and moderating collective social actions were determined in a previous era. Something new is needed, and suspending the economic sphere because of COVID-19 is the opportunity to drive a new bargain between society and business.
Bargain since Battle for Britain
In Britain, our current employment relationship was legally established as a consensual private transaction ever since the market emerged as the paramount legitimating institution for distributing rewards in the 19th century. Society was neatly divided between a public sphere of civil and political interactions and a private sphere of the work, home and family. Public interest in the regulation of these private relations was regarded as an intrusion. In the private sphere, ‘natural rights’ provide guarantees irrespective of government, and ‘individualism’ rather than collective action is the norm. Labour law stemmed from subordinating the aspirations of individual workers to those of the capitalist enterprise, drawing from the common law doctrine of the master and servant. In the early period of the industrial revolution, employer power imposed significant negative externalities on the economic and social system.
But the post-war compromise coalesced around the proposition that the economy would work better if there was a greater balance between employers, workers and wider society. The tripartite common interest was to buttress individual exchanges between employer and worker with collective representation of worker interests through trade unions and works councils, underpinned by a universal social welfare regime. However, since the late 1970s, critics describe the state as hollowed out and restructured, with little interest in maintaining historical institutionalised social compromises. Critical academics such as Jessop have been warning us for over twenty years of the dangers to society of redrawing the boundaries between the economic and extra-economic spheres to maximise the valorisation of capital. Deregulation and de-collectivisation have also impacted the juridical dimension of a Standard Employment Relationship (SER) that traditionally structured relations between employers and workers. Other than statutory wage floors, occupation welfare, and regulations from EU Directives, the prerogative of employers over employment, skills and discretionary decisions has become unfettered which fundamentally shifted the balance of power back to the employer.
We need a new bargain
The distinction between the public and private spheres dates back thousands of years, but the key contemporary text on the topic is a 1962 book by Jürgen Habermas. People operate in these spheres on a daily basis. The basic distinction between them is this: the public sphere is the realm of politics where strangers come together to engage in the free exchange of ideas, and is open to everyone, whereas each private sphere is only open to those who have permission to enter it. Historically, participation in the public sphere is hierarchical and not inclusive.
National social distancing has exposed how poor the current constitution of the public sphere is in representing day-by-day expressions of the will of the people on shared concerns.
At the start of the fourth industrial revolution, clear signs are emerging as to how social distancing might transform into economic distancing – to mitigate the spread of exploitation of shared resources by employers through globalisation. An extension of Habermas’s framework might explain the structural transformation of the will of the people arising from COVID-19.
Post-COVID-19 Triple Helix
This pervasive theme from events such as Captain Tom’s walk for NHS funding is an appetite for changing the state control action on areas of common. As such, I suggest that the triple helix model offers a framework to contribute to this debate.
