The Boundless Thirst for Surplus-Labor
|September 22, 1956|
November 7, 1960
QUESTION. This is from Mr. White, Warren, Mich.
What is your stand on the 32-hour workweek?
Vice President NIXON: Well, the 32-hour workweek just isn’t a possibility at the present time. I made a speech back in the 1956 campaign when I indicated that as we went into the period of automation, that it was inevitable that the workweek was going to be reduced, that we could look forward to the time in America when we might have a 4-day week, but we can’t have it now. We can’t have it now for the reason that we find, that as far as automation is concerned, both because of the practices of business and labor, we do not have the efficiency yet developed to the point that reducing the workweek would not result in a reduction of production. The workweek can only be reduced at a time when reduction of the workweek will not reduce efficiency and will not reduce production.
It’s inevitable… but we can’t have it.
Dick Nixon’s turnaround on the issue of the four-day workweek was epic. His original prediction of a four-day week “in the not too distant future” came in a prepared speech, not in some unguarded moment of overheated campaign hyperbole. He even disclaimed that his “projections” were not “dreams or idle boasts” but were based on the continuation of President Eisenhower’s economic policies.
Following up on Nixon’s 1956 prediction, United Auto Workers president Walter Reuther responded with a telegram calling on the administration to outline a legislative program to achieve the shorter workweek. Nixon sent a telegram in reply and President Eisenhower endorsed Nixon’s reply in a press conference on September 28.
Nixon’s reply was that “mere artificial legislation” would not accomplish a four-day workweek. What was necessary was “dedicated joint efforts of labor, management, government and research.” For his part, Eisenhower “saw nothing wrong with” Nixon’s answer, which he thought also represented his own view that it would be “wonderful” to have more leisure time, but that “no man can say it is going to come about because I say so.” A month after his first comment, Nixon reaffirmed his expectation of a shorter workweek, based on partnership between government, business and labor.
The adamant wording of Nixon’s 1960 dismissal of the idea takes on added resonance in the context of Eisenhower’s earlier caveat that “no man can say it is going to come about because I say so.” Four years later, it “just isn’t a possibility… we can’t have it now. We can’t have it now… [because I say so].”
This wouldn’t be the first time that self-contradiction has appeared in the rhetoric of opposition to shorter work time. The Sandwichman has amassed the world’s largest collection of lame excuses offered by opponents. I assembled 21 of them and sorted them into eight categories having to do with productivity, new consumer wants, unsatisfied needs, labor costs, government policy, self-adjusting markets, history and inevitability, and the devious motives of proponents.
To be kind, the rationales are opportunistic. Mostly, they are jejune partial equilibrium statements invoked as if they were eternal verities. More bluntly, they are mendacious. Every single reason given for not shortening the hours of work is complemented by a contradictory reason for not shortening the hours of work. Damned if you do and damned if you don’t.
Regard the vagaries: the hours of work cannot be reduced because that would lower productivity; but if they were reduced, it wouldn’t lower unemployment because the shorter hours would be just as productive as the longer hours. The hours of work don’t have to be reduced because new consumer demands will create more jobs; but they cannot be reduced because there are so many unmet needs of those living in poverty. The economy will adjust automatically to reabsorb workers displaced by automation; and there is no need for government intervention because government policy will lubricate the self-adjustment process. History gives proof that future reductions are inevitable because in the past they always have occurred; but history shows that the economy has always generated sufficient jobs, implicitly without any need for reducing the hours of work. Contemplate the inconsistencies:
- The workweek can only be reduced at a time when reduction of the workweek will not reduce efficiency and will not reduce production.
- It would throttle at the source the gains in productivity made possible by technological progress, thus shutting off the abundance through which the eventual abolition of poverty must come. Its end result would be fewer jobs, not more.
- …the illusion [job creation] arises, first, from simply not observing or apparently caring to observe the important alteration which the introduction of shorter hours itself exerts on the productive capacity of the workpeople…
- The natural effect of shortening the hours of work to eight a day, therefore, is not in the least to diminish production; it is really the exception when that event supervenes, and as for the most part the same staff does about the same work as before, there is nothing to create any change in the situation of the unemployed…
New Consumer wants
- This view ignores the possibilities for new consumer wants and new industries in stimulating growth and creating more jobs.
- In fact, if people worked fewer hours, demand would drop, and so fewer working hours would be on offer.
- Over the long run, technological improvements create new products and services, raise national income, and increase demand for labor throughout the economy.
- What the drive to shorten the work week ignores is that the country cannot afford it, either in terms of production costs or of unsatisfied national and world needs.
- …by working less, we will throw away the opportunity automation and other improvements in technology afford to banish poverty at home or abroad.
- This view ignores the possibility that the demand for labour may depend on the relation between wage rates and the value of work to employers.
- However, if restrictions on hours make labor less attractive to employers, they will substitute to other inputs, and there will also be a scale effect reducing use of all inputs.
- The unemployed are apparently to obtain employment from capital which only comes into being as the result of their employment; they are to provide a handle to their axe from the tree they hew with it…
- If proper monetary, fiscal, and pricing policies are being vigorously promulgated, we need not resign ourselves to mass unemployment.
- Though technological unemployment can’t be shrugged off lightly, its optimal solution lies in combining expansionary macroeconomic programs (fiscal and monetary policies) with retraining policies that create adequate job opportunities and new skills, rather than restrictions on production.
- So what will happen if we use shorter hours to cut unemployment? Inflation will rise more than it would otherwise. Two responses are then possible. One could say, ‘Bravo We have cut unemployment and we are willing to accept the rising inflation.” But if this is the reaction, it would obviously have been better to cut unemployment by expanding output than by simply redistributing a given amount of work over more people. So there is no case for shorter working hours along that route. Along the alternative route the outlook is even bleaker. In this scenario the government sees inflation rising, decides it is unacceptable, and allows unemployment to rise back to its original level (so as to control inflation). The net result of shorter working hours is then no reduction in unemployment, but a reduction in output.
- …a permanent and a more or less general reduction in hours will cut down the amount of technological unemployment. … The transition will without any doubt lessen the amount of unemployment for the time being. But when once the new level is reached and the necessary adjustments in industry have been made, there is no reason for believing that the volume of unemployment will continue to be less than it had been.
- Trade is not hemmed in by great walls, beyond which it cannot go. By bringing our goods cheaper and better to market, we open new markets, we get new customers, we encrease the quantity of labour necessary to supply these, and thus we are encouraged to push on, in hope of still new advantages. A cheap market will always be full of customers.
History and inevitability
- By 1980, the thirty-hour work-week should be widely established and some progress made toward the twenty-five-hour week.
- History provides little support for this gloomy view… that the economy can generate only a fixed amount of work.
Devious motives of advocates
- Their aim and object is, in every case which we have been enabled to investigate, to stint the action of superior physical strength, moral industry, or intelligent skill; to depress the best workman in order to protect the inferior workman from competition…
- …motives very different from these [proclaimed reasons] actuate many who most earnestly appeal to the State to impose a legal limit upon the days work.
Implicit in much of this pretentious double talk is the notion that consumer demand is utterly independent of wages, so “the economy” can become more prosperous by lowering wages. Apparently, economists are still so enamored of Say’s Law that they haven’t paused to consider the implications of Say’s other law — that “misery is the inseparable companion of luxury.”
But there is one perspective from which coherence can be divined from all this self-serving ad hocery. Unwittingly, the opponents of work time reduction adopt a theory of surplus value very much like that elaborated by Karl Marx in Capital. It is not a matter of whether such a theory adequately describes the determination of value or of prices. Right or wrong, the theory guides opponents’ attitude toward the reduction of working time. They are accidental Marxists!
Replace “collective capital” with “the economy” and “collective labor” with “fallacy adherents” in the following declaration and we have a fine slogan for The Economist’s unrelenting campaign against the lump of labor fallacy.”Hence it is that in the history of capitalist production, the determination of what is a working day, presents itself as the result of a struggle, a struggle between collective capital, i.e., the class of capitalists and collective labor, i.e., the working class.”
Marx summarized the relationship between the production of absolute surplus value and of relative surplus value in the following passage:
Assuming that labour-power is paid for at its value, we are confronted by this alternative: given the productiveness of labour and its normal intensity, the rate of surplus-value can be raised only by the actual prolongation of the working-day; on the other hand, given the length of the working-day, that rise can be effected only by a change in the relative magnitudes of the components of the working-day, viz., necessary labour and surplus-labour; a change which, if the wages are not to fall below the value of labour-power, presupposes a change either in the productiveness or in the intensity of the labour.
Of course labor is not always “paid for at its value” and neither the length of the working-day nor the productiveness of labour are givens. There is a continuous tension between efforts to lengthen or shorten the working day and to increase or relax the productiveness and/or intensity of work. Although analytically separable, these two processes are actually always simultaneously in play.
Thus, in the capitalist form of society in which exchange values predominate, rather than use values, there arises from the nature of production itself a “boundless thirst for surplus-labour.” To emphasize: this “boundless thirst” does not arise from the needs or wants for goods and services of consumers but from the compounded compulsion of the capital accumulation process.
From the standpoint of this boundless thirst for surplus-labor, any attempt to limit the length of the working day or to impede the intensification of work, or hold onto part of the proceeds from it, must indeed appear as a irksome fixation on a “fixed amount of work,” especially if “work” is understood to refer precisely to that portion of the working day that is expropriated by capital.
Let us now revisit Nixon’s 1960 repudiation of the four-day workweek with a slight amendment.
The workweek can only be reduced at a time when reduction of the workweek will not impede capital’s boundless thirst for surplus-labor.
It’s really pretty simple why the work week isn’t shortened:
For n labor hours work to produce x, where x is driven by producer’s satisfying demand (at some profit and price level), shortening the work week requires producers to hire y% more workers to maintain n labor hours work to produce x.
That reduces the available proportion of people looking for work which increases the costs of labor to producers. That increases producer’s labor expense which reduces profits. This assumes that people working fewer hours (say 4 fewer than 40 or by 10%) will demand 10% greater pay per hour to make up the difference in income working fewer hours.
I lived in Germany when the 32 and 36 hour work week was being debated in gov’t.. and the condition was mandated by gov’t (through the work councils) that weekly income could not be reduced –though some exception conditions applied. By the time I left Germany the work week had been reduced by 4 hours I think.or. maybe just 2 .. I can’t remember the details from the early 1980’s. Furthermore it only applied to hourly paid help… i.e. not to exempts.
Producers require an excess of labor supply to insure they can keep labor prices down by pitting one laborer against the next .. without unions of course. Reducing the excess forces them to pay more to get employees, hence hits the owners profits directly. Their incentive then is to transfer labor costs to increased productivity through capital automation costs to reduce demand for labor…. creating an excess labor supply again over time… then incentivizing labor to reduce the work-week again (through gov’t mandate) etc. in a never ending cycle that is actually no different than the present system… but which would be an acceleration of the system we’ve been in.
An equilibrium to insure excess labor supply will always be established no matter what the work week hours mandated. In the short term there’s a reduction in the excess driving down producer’s profits so they will always be opposed (as they were for the 40 hr mandate, btw, and as they were for 50 years in England for the 7 day week, 10 hr day mandate (initially only applied to women and children)..
When I worked in China in the early 1990’s factory workers in high tech assembly worked 12 hour days… 12 hours per work shift. I don’t know if the Chinese gov’t has reduced that by mandate yet or not, but they sure did mandate an increase in the take-home hourly wage for assembly line workers in the high tech industries every few years. And it was well in excess of inflation so it was a real wage increase each time.
I believe that Sandwichman has made his counter-argument to your first statement elsewhere, but I can’t find the link. It was on his Ecological Headstand blog. The counterargument was that productivity per hour actually increases as working time goes down because the laborer is more rested and happier. I’m pretty sure every living human being can attest to that, but to make sure, economists periodically run tests on this and are amazed at the results. Then they forget them.
Psychologically, however, you are correct. No matter how often employers are told of this productivity increase, they go against it since their real goal is the reduction of labor’s bargaining power and the convenient excuses get trotted out to square this circle.
It was actually quite amusing to see an article in my provincial newspaper a while back where two sides were arguing about a reduction in the work week, and you could play bingo with the excuses the anti-side used. There wasn’t an original idea in the whole article, as the pro-side was almost apologizing and got one paragraph of the six on offer.
The idea of lame excuse BINGO really appeals to me — a lot! Thanks for that. Look forward to the LUMPO game in the near future. I’ve got 21 excuses here and the standard card has 24 squares so not too hard to find another three.
It has been my experience using throughput analysis on the shop floor, productivity will increase as working time decreases and pay remains constant. People like to have a life also. Pay a small amount of attention and productivity will increase also. I do not remember any economists on the shop floor with me; but, a couple of manufacturing engineers were though. Process changes and flow changes not including capital can also make a “yuge” difference in productivity. Don’t change technology for technology sake.
Salty, I don’t disagree that workers are more productive at the start of shifts.. I’ve measured an element of it myself in fact during my career to show that a longer break time improved productivity per shift / day…. and succeeded in getting most mfg’ing departments to increase breaks by 5 minutes… longer increases reduced productivity. That took me about 3 years to do with successive trials and shoving the data in upper management’s faces at every opportunity.. plus getting the corporate shrink to agree.
That aside however, labor productivity is always limited relative to producer’s desired (which are infinite, btw) so employers are always incentivized to replace labor or reduce dependencies on employer loss of productivity with time during the course of shifts.. using “assembly line tempo” in the machines … forcing labor to keep pace, for example is the most easily implement common
Experience teaches employers that pushing labor too hard reduces productivity through yield losses.. generally at process steps much further downstream which are then far more costly i(value add increased) in yield loss than where the problem was created. The employer’s solution is to automate that step by replacing labor’s content / participation in the step, increasing productivity by capital means.
Technology can continuously improve machine productivity per unit over time but it can’t continually improve human productivity (fatigue, speed of hand/eye coordination, attention span, addictions to caffeine nicotine, sugar, health (flu, colds), mental state (argument with spouse, children, boss, co-worker). We’re limited by evolutionary dna conditions and distributions.
The unregulated capitalist profit system has an inherent incentive to minimize labor’s restrictions on output and to the degree it can do so under regulated conditions, it will always seek to replace labor where it can do so at profitable levels.
If you can get a productivity gain which doesn’t reduce profitability by reducing the work week (hours per week regulated by mandate) then that gain is easily calculated for a break even profit condition. But the calculation includes the impact on reductions in available labor, thus increase in labor’s bargaining power, hence increase in relative price of labor… thus incentivizing and profiting more by greater capital investment in replacing labor to get the available supply / demand ration back in line to minimize labor’s bargaining power again.
It’s a never ending cycle limited only by the rate of technology improvements in reducing dependencies on labor content. The key word is “rate” .. when the rate reaches a threshold or exceeds it then the rate of employment demand reduction exceeds the rate of employment available per unit time and population growth.. leading to ever increasing supply of under utilzized or unused labor.
Ideally this should reduce incentive to replace labor with capital automation, but at some point the costs of increasing automation fall fast enough to always make it a greater roi on capital to replace labor at a greater rate than new demand for it is created.
The evidence of this was in “automation” by offshoring to low wage labor nations.. it really doesn’t matter domestically whether you use automation capital to replace labor or you replace it by using the same or less capital to xfer it to low wage sources in other nations.
All of these issues are well beyond economics by itself.. they are part and parcel of gov’t rules which are the laws which either favor capital owners profits & roi, or labor’s. The economics in capital profit motive systems will adjust to maximize capital profit no matter what the rules are. Those adjustments will inevitably lead to reductions in labor’s share of output productivity in a democratic system (such as the U.S’s where money talks and everybody else takes the hindmost) .. the only countering force is gov’t mandated tax distributions.
This isn’t an economic issue at all.. it’s purely and solely a political one. It is now, and always has been (at least since the dawn of the industrial revolution in England and ever since).
Parenthetically I find it interesting that our employers’ haven’t come out dead opposed to the restrictions on immigration — legal or otherwise) since they depend on it to keep labor supply high relative to demand and thus reduce labor’s bargaining power, hence real wage growth… this is more acute of course in the western states, but should also be a major economic factor in any agricultural labor intensive business, and in hospitality business’s (restaurants, lodging)… at least where intense competition is a factor.
You are aware that the average workweek for non-supervisory employees is down to some 33 hours. In manufacturing the workweek is still the traditional 40 hours but in services it is 32.3 hours. In retail it is 29.9 and inhospitality it is
in hospitality it is 24.9 hours.
I wonder why the lowest paid sectors have the shortest workweek.
Maybe because in those industries it pays to have a lot of part-time workers.
But the data contradicts a lot of the claims presented in comments.
“Averages” of aggregate hours are misleading because the aggregate adds apple hours and banana hours. “Hours” is not a standard unit when it refer to 1/40 of a manufacturing week and 1/25 of a hospitality week.So the data neither contradicts nor confirms the claims. It is irrelevant because you can’t “average” things measured in different units. The illusion arises because clock time is standardized. But work time is not clock time.
I’m sorry, but I completely fail to understand your point.
I assume you are referring to my comment about averaging aggregate “hours”. To take an average, you need to have a standard unit. The average height of three people whose heights are 6′, 5′ and 4′ is 5′. Hours of work is only
apparently a standard unit because it is abbreviated as “hours” — but it is NOT hours that are being measured but hours-of-different-kinds-of-work.
What is the “average” of one gallon of oil, two gallons of water and three gallons of bourbon? Is it two gallons of liquid? You could say that but it is a meaningless “average.”
Reposted at naked capitalism as “Why You Can’t Have a Shorter Workweek”
I’m actually curious about this. Are we really talking about a 4-day week – or some particular number of hours? A 4 day a week 9 hour a day week is 36 hours, when many had a 35 hour week. How was that not possible? (OK I know that if you had 24 hour operation in 3 * 8 hour shifts that might be difficult – but how widespread was 24 operation.