Tuesday, September 13, 2011

Workers as Commodities.

In 1944 the International Labour Organisation, at its meeting in Philadelphia, declared that "labour is not a commodity" a declaration intended to reassert the ILO membership's commitment to the achievement of social justice .

In Sunday's New Zealand Herald Damien Grant asserted that "Economically, the unskilled are irrelevant. They are a commodity." Roger Kerr's comment to the Dublin Economic Workshop in 1999 made a similar point although in a considerably more moderate form: "while people are not commodities or articles of commerce, the labour services they provide using their mental and physical capacities most certainly are." Kerr's comment, especially in its wider context, makes it clear that his comment extended to all workers who are sellers of labour services, unlike the position taken by Grant that "Only talent matters" with the implication, unlike Kerr, that "talented" workers, whatever these may be, are in some way not commodities but rise above the common herd!

I do not intend to comment in any detail on the obnoxiousness of Grant's comments but they should not go unremarked.

The view that labour is a commodity, and the related claim that there is no inequality of bargaining power, may make sense in the abstruse mathematical models of neoliberal economists, and it can be argued that it is economically illiterate to make such comments. This is true, however, only if the discussion is confined to economic models, models whose relationship to the real world is tenuous at best. There is much to be said for the comment that economics was invented to make weather forecasting look credible. In other words such statements are essentially assertions, made within the realm of economic theory, and should be confined to that sphere. Outside a strict economic context Grant's statement translates as "unskilled workers ought to be commodities".

The statement that "labour is not a commodity" is not an economic statement-it is a normative statement designed to express a particular set of political and social values that I need not elaborate on. They are well known in any democratic society. In essence it encapsulates the values that all workers are entitled to expect to work in decent conditions and to receive a reward for that work that provides a reasonable standard of living relative to the economic condition of the society within which they live. It is also a rejection of extreme market ideology of neoliberal economists. Genuine science observes and attempts to explain the world. Economics develops models and wants to make the world conform to them, a characteristic it shares with religion.

The fundamental problem with comments such as that made by Grant is that they take statements that may have some validity in a closed and limited model, and attempt to present them as a universal truth rather than as the ideological position they are. Grant is attempting to win an ideological-political argument that seeks a particular distribution of wealth and influence in society-a normative position that he seeks to disguise as an inevitable truth.

The rest of us may have trouble with defining exactly what our normative position is but at least we are not pretending to do otherwise.

1 comment:

  1. "...no employee is an asset in the employer's balance sheet to be bought or sold."

    Echoes of Minister for Employment and Workplace Relations v Gribbles Radiology Pty Ltd [2005] HCA 9

    Great post Gordon; and a timely reminder.