Rethinking Public and Private Power: Anderson’s Private Government and Labor Law Reform

This post is part of a symposium on Elizabeth Anderson’s Private Government: How Employers Rule Our Lives (and Why We Don’t Talk about It). Read the complete symposium here.

Catherine L. Fisk –

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Elizabeth Anderson has gained rock star status as the leading philosopher-critic of rising economic inequality and its threat to democratic society. In her second Tanner Lecture, Anderson provides one of the most exciting theoretical justifications for labor law reform since the demise of popular interest in Marxist theory. Anderson’s work inspires me to think about the importance of worker control of access to jobs, co-determination of workplace and corporate governance, and the importance of inclusive unionism along the entirety of a supply chain.

The Industrial Revolution, Anderson says, shattered eighteenth century egalitarian theorists’ hope that “a free society of equals might be built through a market society.” Employment in large enterprises for the vast majority of workers after the Industrial Revolution, whether in a Ford factory in 1930 or in McDonald’s today, was to subject oneself to a dictatorship for most of one’s waking hours. The only real freedom the worker enjoys is to quit. The freedom to quit is not much freedom. (After all, Anderson points out, Mussolini was no less a dictator because Italians could emigrate.)

Labor unions are the only mechanism in history that institutionalized what Anderson identifies as the four essential ways to protect “the liberties and interests of the governed under any type of government.” These are (1) an effective use of the threat of exit (as by striking or enabling workers to leave a job without being blacklisted or unemployed), (2) the rule of law (effective enforcement of contractual and statutory rights to minimum standards and fair treatment), (3) substantive constitutional rights (rights at work), and (4) voice (a say over working conditions). Unions are the only institution that achieved nationwide scale and a sustainable funding mechanism to enable consistent performance of these four functions by and on behalf of workers. Other worker formations (worker organizations like ROC United in the restaurant industry or the National Domestic Worker Alliance in domestic work) could play many of these functions, and already do on a limited scale, but they have yet to achieve meaningful voice in the workplace.

As we look to ways to rebuild organizations for worker power, it is worth looking at the models developed by labor activists and their lawyers during and after the New Deal. The explicit purpose of the National Labor Relations Act of 1935, which granted workers the right to unionize, was to create a more equitable political economy and a more robust political democracy by protecting workplace democracy. Shared determination of the conditions of work – what used to be called industrial democracy — was considered essential to political democracy. As the statute’s principal sponsor, Robert Wagner said, those who “know the dignity of freedom and self-expression in their daily lives … will never bow to tyranny in any quarter of their national life.”

Below, I outline three strategies developed in the mid-twentieth century that offer promising directions forward:

Worker Control of Access to Jobs: Hiring Halls for the 21st Century. In the 1930s, the west coast International Longshore and Warehouse Union (ILWU) successfully wrested control of the day labor market that had kept wages low by pitting workers against each other in the struggle to find jobs. The ILWU, like many others in sectors that had gig economies and day labor markets, started hiring halls so that workers, not employers or labor contractors, could decide who got to work and on what terms. A platform like Uber is a virtual day labor market, and the key to Uber’s supra-competitive profits is its control over the market. If you want to know why Uber, Lyft, and other platform companies are fighting tooth and nail – through antitrust law, through preemption arguments, and through efforts to repeal protective state and local law — to get courts to outlaw union organizing among their workers, it’s because they fear that if drivers had any power to negotiate over what customers paid, drivers would get a greater share of the profits. Uber claims that drivers are free to control their earnings by deciding when and how much to work. Of course, that was true of longshoremen in the 1930s and day laborers today. But the right to work fewer hours or to quit altogether, Anderson points out, is not freedom or self-determination. Meaningful labor law reform should revive and expand the hiring hall so that workers can protect themselves from exploitative conditions in the gig economy today.

Property (or other Legal) Rights in Co-Determination of Work. In 1937, when auto workers forced General Motors to recognize their union by occupying the company’s Flint, Michigan factories, the union’s lawyer, Maurice Sugar, articulated a theory of property to defend the right of the workers to occupy the plant. In Sugar’s view, workers had a legal right, not merely a moral right, to be in the plant because they, equally with the management, were General Motors. The contemporary notion that shareholders and managers are the only ones who should control the corporation and whose interests must be prioritized in governance should be highly suspect in a society dedicated to the democratic principle of equal voice. Workers today can lay claim to that legacy, demanding property and other legal rights to direct firm activities. Labor law reform should include worker representation on corporate boards; this is hardly a radical concept, as it exists in Europe.

Inclusive Unionism and Supply Chain Bargaining. Labor law reform should also empower workers throughout supply chains, as is happening through the Coalition of Immokalee Workers’ Fair Food Program, and build inclusive organizations that transcend boundaries of race, ethnicity, immigration status, and occupation. This would not only empower workers, it would also strengthen democracy. Hawaiian labor history illustrates why. As Moon-Kie Jung explains in her powerful book, Hawaii was a plantation economy dominated by five white intermarried families (“the Big Five”) who enlisted the United States to overthrow the Hawaiian monarchy and brutally suppressed worker dissent and unionization. The Big Five supported the imposition of martial law in 1940, which made it unlawful to quit a job or to resist managerial control, and fixed wages to artificially low pre-war levels while guaranteeing an 8% profit for owners. It comes as no suprise that when the war ended, the workers tried to unionize. What is significant is that their union, the ILWU, organized everyone, of all races and occupations, throughout the whole sugar and pineapple chain of production and distribution, from the fields to the docks. The employers’ effort to exploit racial divisions to break the union failed because the union insisted on leadership that included all races and ethnicities. The bosses hired 6,000 Filipinos as strikebreakers, counting on their animosity toward Japanese union leaders, also failed because the union representing the sailors on the ships that brought the workers from the Philippines helped organize them en route. As Professor Jung explains, the unionization of Hawaii dramatically improved working conditions and, not coincidentally, transformed Hawaii from a red state to a blue state.

These are just three possible strategies drawn from American history which the labor movement could adopt to combat private domination at work. They would help to build democracy at and away from work. They would address, at least to some extent, the growing concentration of wealth and power in the hands of the very few.

Catherine Fisk is the Barbara Nachtrieb Armstrong Professor of Law at U.C. Berkeley School of Law.