Company-society

In “Company and Society: Foundations of a Humanist Economy” (“Empresa y Sociedad: Bases de una Economía Humanista”), and in diverse articles and seminars, José L. Montero de Burgos explains the humanist position, which is opposed to the concept of ownership (*) of things. Ownership of things (in this case, the company) has given power (*) over people. Inverting this, the power of the people should give ownership of access to the company income, and under no circumstances should such power be exercised over people. But where does this power originate? Power is accorded by the risk assumed by capital, as well as by labor; therefore neither can be the company’s sole owner; rather, power over it must be held on the basis of who is responsible for its management, for making the decisions. The power is linked to “the entrepreneur who puts up the money,” to the company owner, or, in the absence of such, to the property owner. A more recent trend is for this power to be transferred to a team of executives. But if this team of executives does not satisfy Capital with the rate of return produced, it runs the serious risk that Capital will replace it with another team more capable of attaining the objective, which is solely to make a profit. In any case, power remains with Capital. Moreover, given that the modern company is conceived dynamically, its growth and its capacity to compete are linked to financial resources, which it cannot always raise on its own. The current trend in the evolution of power ― only incidentally held by the technical management ― is to shift to the financial power, to the power of money, since the future of the company depends on it. A bank can ruin a prosperous company by denying it credit. And it can do it, because it is not accountable to anyone for the decision. Here we have what may be termed, using an astronomical metaphor, the “great attractor” of power. The growing power of money is linked to the constant loss of power of labor. In general, workers have pressured in the direction of improving their wages and working conditions, and company owners in the direction of reverting benefits back to the company, for its expansion and/or to strengthen it, or to allocate benefits to . But today, in this confrontation, workers are giving increasingly more importance to job security; technology multiplies productivity and fewer and fewer workers are needed. In addition, the constant changes in the marketplace demand rapid adaptation, such that owners continue to press for the elimination of obstacles to firing or laying-off workers. On the other hand, industrial and commercial reorganization downsizes many companies that end up in bankruptcy, leaving their workers jobless. The monstrous growth of speculative activity is also exerting influence. Speculative activities produce no benefits for society. They are possible because of capital’s exclusive power in the companies. It is already known that speculation consists of buying assets (stocks, companies, land, currency, products) to be later sold at a higher price, and the benefit is produced by the difference between the purchase and sale price, but without the goods in question undergoing any change in the process that is useful to society. Only its price is transformed. When the object of speculation is the national currency, we see the State itself making use of a fund that belongs to all citizens, so that speculators can distribute it among themselves. If it is accepted that things cannot be sources of power over people, then corporate power, as it is conceived today, loses its foundations. Therefore another basis of power must be found that allows the free creation of enterprises. This is congruent with Part I of the Humanist Statement (*), in which power is based on risk ― in this case, the entrepreneurial risk assumed by the members of the company. We may then inquire about these risks: The investors run a risk. They can lose everything ― or, at least, a part of the capital invested. Therefore they have the right to participate in decisions, the right to manage the company, because of this human situation of risk ― not because capital gives them power. Otherwise, if the investment were not at risk of being lost, its contributor would lack grounds for claiming any power of management. Their real risk gives grounds for their power. The workers run a risk. If the company fails, they lose their jobs. And this risk cannot be downplayed. When workers lose their jobs, they lose their employment stability. They must look for new employment. They also lose their financial stability, since unemployment insurance, where it exists, neither equals their former income nor guarantees it indefinitely. They lose their social stability because, under such circumstances, their social relationships deteriorate. They lose their moral stability because they cease to do work that is useful to society and that justifies their earnings. Their own human dignity compels them to not be social parasites; and if they accept this situation passively, the risk of moral degradation that goes with being unemployed becomes a reality. Therefore, workers lose if the company fails. Workers also assume entrepreneurial risk, and therefore have a right of self-management, because of their own human situation, and without any need to buy company shares to justify their power. They, like capital, run economic risk, and thus have a right to self-management, to control their own human situation without any need to buy shares to justify their power. The foregoing discussion is not without significance from the conceptual point of view. It represents a “turning upside down” of the current rationale of ownership, which says: “Ownership (of things), hence power (over people).” If power is based on risk, the above is inverted and now becomes: “Power, hence ownership.” That is to say: power (linked to entrepreneurial risk), hence ownership of things (i.e., access to ownership of the company’s profits, and not access to power over people). In today’s world there are three entrepreneurial alternatives: 1) Capitalism, based on private enterprise, in which the ideological structure is nourished by present-day neo-liberalism. It requires a market economy, of which work forms a part, and favors accumulations of capital, which for the most part end up flowing into the hands of the few: the rich. The union system is free to organize. 2) Socialism, based on state ownership of the means of production. It borrows its ideological structure from Marxism; it favors a planned economy, controlled by the state apparatus; it eliminates the market for labor, replacing it with bureaucratic measures; and it allows accumulation of capital by only one entity: the State. In theory, implementing this proposal is a first step toward the development of self-management in business enterprise, which is congruent with the principles of socialism. There is a single union, controlled by the state apparatus. 3) Cooperativism, which favors cooperation in enterprise and is equally suited to capitalist and socialist environments, but lacks its own socioeconomic ideology. It offers no satisfactory solution to the situation of workers who do not enjoy co-ownership, and does not ordinarily provide effective ways to accumulate capital; such enterprises have to rely on “soft” credit, dependent indirectly on the State and in practice provided by banking or non-banking institutions connected to the official apparatus. It does not have its own system of unionism. Another recent alternative is social democracy, a compromise between socialist and capitalist postures. But the existing social democracies are not applicable to the developing countries because they require stable unionization; nor are they humanly acceptable, requiring as they do the existence of a powerful social class that accumulates capital. If we contemplate the social problem from a biological perspective, it seems logical to assume that the appropriation of resources by human beings must be coherent with nature, and also with their own specific conditions. All living beings acquire resources to carry out their vital functions through appropriations of two types: one type might be called “private” or individual, and the second are forms “in common,” such as might be observed in ants. Even within a single biological community, both types can coexist. But nature has also developed, in addition to these two kinds of appropriation, what Montero de Burgos calls “generic appropriation,” under which all resources are potentially available to any life form and form of appropriation, private or common, and in which resources are thus subordinated to a higher level of appropriation, and open, therefore, to a redistribution of these resources that permits the continuity of life. Humankind, for its part, has rationalized both forms of appropriation, converting them into private or common property, respectively. But it has yet to develop generic property, which encompasses both forms, giving flexibility to them and, of course, removing from them the kind of permanence that each of the two previously discussed modes now possesses. In short, the resources of the planet are neither the private property of those who have access to them nor the common property of humankind, but rather generic property. That is: all human beings ought to have ownership of all things. A paradigmatic example of generic property is air, which is not of course the private property of anyone, but neither is it the common property of humanity. All living beings who need it must have access to air, and human beings cannot appropriate something that does not belong to them exclusively, but rather is open to each and every member of the species, and to each and every living being by virtue of their need to breathe. Air is the generic property of all living beings. Let us see now to what property type that very specialized form of property we call the human body corresponds. Of course, it could well be affirmed that the human body is not the common property of humanity, much less of the State. The initial subjective tendency is to designate it the private property of the subject of that body. But in reality, and in accordance with the notion of generic property, I am not the owner of my body, although for obvious reasons of emotional attachment I have the right to decide all matters concerning my body or, to put it another way, I have the right to manage my body, at least in principle. To clarify this point, let us suppose that I come upon a person who is injured and thus incapable of taking care of himself. If there is no one else, this wounded person requires that my body assist him in surviving that situation. By reason of need, the wounded person activates the principle of generic property on his own behalf, and assumes the right of management of my body. Of course, I can refuse to let my body be of assistance, but in that case I am “stealing” something, denying the person what is theirs. On the other hand, if I decide to help, taking the person to a hospital for example, once the person is there, all needs satisfied, I recover the right to manage my body. Thus, the human body is but another resource of generic property of human beings, although one over which the subject of that body has priority. In reality, it is a property shared with the persons whom the activity of my body affects (e.g. my family), although normally their management is minor. To be able to resolve this same hypothetical problem in the case of private property, we would need to introduce some moral or legal obligation that is separate from the concept of ownership. Generic property, on the other hand, has the virtue that in and of itself resolves satisfactorily the hypothetical case we have been considering. Certainly, Nature does not assign access to resources by the same rational process as in the currently prevailing rules used by human beings: ownership, hence power; quite the contrary, in Nature: power, hence ownership. That power, in levels inferior to the human species, is physical strength in its broadest sense. Strength, hence ownership, is the instrument that Nature constantly and continually uses in the struggle for life. That strength or power is what maintains appropriation, which declines as that strength declines. In the case of humankind, that strength has to be not natural but human strength, and the dialectic becomes: human power, hence ownership. What this would mean is: a) Need, hence ownership, so that every human need attains satisfaction; b) work, hence ownership, so that work is the normal way by which human beings gain access to resources; c) risk, hence ownership, so that the one who runs the risk will have not only the power necessary to overcome any difficulties that arise but also sufficient stimulus to incur the risk, if that is what society needs. In the relation company-society, this proposal is coherent with a way of understanding power that, as the source of resources, is linked to the human value of economic risk.