Trade Unions and National Wages Policies

TLDR: In this paper, the relation between working-class political and industrial power and the feasibility of a national wage policy is examined in 13 Western democracies and two conditions for the acceptance of such a policy are identified: first, the working class must be sufficiently united politically to elect a Socialist government that will administer the wages policy in such a way that workers or at least their leaders in the trade unions are convinced that the policy is not simply a way of depressing their incomes relative to those of the rest of the population.

Abstract: U sing data relating to 13 Western democracies,' this paper deals with the relation between working-class political and industrial power and the feasibility of a national wages policy. A wages policy is only feasible in a democracy if it is accepted by tradeunion leaders on behalf of the workers whom it directly affects. For this acceptance to be forthcoming we hypothesize that two conditions must be fulfilled. First, the working class must be sufficiently united politically to elect a Socialist government that will administer the wages policy in such a way that workers, or at least their leaders in the trade unions, are convinced that the policy is not simply a way of depressing their incomes relative to those of the rest of the population. Second, the workers must be sufficiently united to form a strong centralized union movement that can help administer the policy without imposing excessive strain on the cohesion and loyalty of its own organization. It is hoped that this study will be of interest from several perspectives. From the perspective of political development theory, it will be useful to observe how some very powerful interest groups will, under certain circumstances, decide that the public interest requires self-restraint of them in the pursuit of their own sectional interests. Thus the trade unions, having attained a fairly dominant position in several political systems, have proved willing to accept the principle of wage restraint embodied in a national wages policy. The implications of this development will be more fully discussed in the concluding section of the paper. It is clearly of great importance, however, that the "sub-system autonomy" enjoyed by interest groups in the Western democracies should not lead to the unbridled exercise of power by organized business and