Two Social Contracts
A. Accord: 1930-late 1960’s
B. Post-accord: 1970’s- today
The Accord (1930-late 1960s)
Social contract between employers and workers
Secure and well-paid jobs
Stable and productive workers
Social Components of the Accord
Unions and big business
Management recognized workers right unionize and to strike
Collective bargaining
Explicit contracts
Length of work day, number and length of breaks, the pay for work, hiring and firing, and benefits
Regulation of conflict: National Labor Relations Board
Regulated strike: sit-down outlawed
The Accord : The Dual Economy
Core (monopoly)
National and Intl. Markets
Large labor forces--unionization
Capital intensive
Tied to the national economy’s well-being
Periphery (competitive)
Local and regional markets
Labor intensive
Small labor force--no unions or white collar
Little impact on national economy
Economic Consequences:
The Accord
USA became the economic leader of the world
Expansion of workers’ material wealth
Bought what they produced
Facilitated gender division of labor: breadwinners and homemakers
Expanded middle-class
Employment stability
1. Breakdown of the Accord
Failed competition and declining profits
Paper entrepreneurialism
International competition: Germany and Japan
Rising costs and declining profits
Inflation--declining value of the dollar--high cost of labor
Eurodollars--military involvement
2. Breakdown of the Accord
Corporate strategies for maintaining profits
Industrial restructuring: shift from manufacturing to service--deindustrialization
Union busting
Relocate to non-union states
Personnel advisors to convince not to unionize
Bankruptcy
Decertification of unions: To proof unions are not necessary for industrial peace
3. Breakdown of the Accord: Globalization
There is no economic center (for example, the USA or Germany)
A network of actors who compete for dominance on a global level
Manufacturing process is fragmented and dispersed throughout the world
Female workers--third world and sweat shops in the first world
4. Breakdown of the Accord: Technological Innovation
To create new products
To produce the products they already make at a lower cost and in great volume
Possible by:
Computers: information, banking, production
Containerization
Just-in-time production
Flexible Production and Accumulation
Computer-aid design and manufacturing
Computer centralized control of the manufacturing process
Control over internationally dispersed units
Computers
Control assembly line process
Communications
Monitor and adjust product processing
Remember:
Flexible production: The way work is done
Flexible technologies: The tools used to do the work
Flexible labor force: The people who do the job
Also
- None of this would be possible without banks--increased mobility of capitals
The Structure of Labor
Service Sector
Producer Services (Finance, insurance, real state, professional)
Social Services (Health, Education, welfare, public administration)
Distributive services (Transportation, communications, wholesale and retail trade)
Personal services (entertaining, domestic, hotel, drinking and eating)
Dual Labor Structure: Core and Periphery
Core (Good jobs):
knowledge intensive
safe and clean
well paid and