Taking back worker power: Elizabeth Humphrys’ How Labour Built Neoliberalism

What can the labour movement do when faced with a crisis of capitalism? This is the central question that Elizabeth Humphrys’ How Labour Built Neoliberalism seeks to answer through an historical reading of Australia’s Accord and the labour movement’s role in the neoliberal project of the 1980s. Given ongoing economic instability since the Global Financial Crisis, the strategy of the labour movement in the face of a weak economy is a question of continued salience and urgency.

At first blush, Humphrys’ withering account of how the trade union movement – including left unions at the time – were active participants in the neoliberal turn in Australian society may produce a knee-jerk defensiveness on the part of ardent unionists like myself. It shouldn’t, though. Humphrys writes with the compassion of a comrade and the insight of an intellectual who grew up in a working-class household.

Evidence of this perspective can be found in Humphrys’ account of the economic pressures of the 1970s and early 1980s, and the accompanying industrial fatigue. As she explains, ‘neither the confrontational Fraser Government nor the historically militant labour movement had achieved a decisive victory.’

The Accord was a social contract between the trade union movement and the Labor Party on incomes, industrial action and the expansion of the social wage primarily through Medicare, superannuation and other welfare measures which went through various iterations between 1983 and 1996. In Humphrys’ account, it is presented as a solution from its era to ‘an impasse in the Left’s strategy’ which responded to pressures from both above and below. The idea was to resolve problems at the level of the state that had heretofore been irresolvable through workplace activity.

It is here that Humphrys’ work rises above vulgar Marxist readings of the period, which can tend towards a simple morality tale. In those narratives, trade union leaders of the time are usually presented as selling out members and curtailing shop-floor activism in order to prop up the Hawke-Keating ALP Government. By contrast, labourist counter-narratives characterise the Accord as an Australian alternative approach to addressing economic instability compared with the Reagan and Thatcher’s New Right administrations – an alternative that was rudely disrupted by the election of the Howard government in 1996. How Labour Built Neoliberalism takes seriously the material pressures that the leadership of the labour movement faced at a point in time when the global industrial power of metalworkers was waning after a period of roughly one hundred years. Yet it also unflinchingly details the impact the Accord had on the grassroots structures of the Australian union movement, including the AMWU’s residential branches.

In the end, coming to terms with the truth and accepting the labour movement’s culpability in the neoliberal turn in Australian society is more empowering and leads to better strategic decision-making.

Humphrys portrays the labour movement not only as victims of the neoliberal restructure but also as willing agents. The uncomfortable reality is that agency does not always come with good results. During the Accord, the leadership of the labour movement used its influence to relinquish the agency of its membership base, and in the end much of its own agency. By highlighting the movement’s role in actively constructing neoliberal society, Humphrys indirectly points to a future in which labour can unmake neoliberal society. If the complicity of the working-class was required to make Australia what it is today, then those same agents of history can withdraw their consent.

The book opens up a discussion about the contemporary ‘profound disorganisation of trade unions’ not with the end of lamenting that which has been lost but as the starting point for how workers can win back control over their lives.

People-power is fluid. The otherwise calm surface of social passivity can hide great currents of energy and change that might rupture at any moment. It is the patient work of an organiser to help people channel their power into building a new society free from alienation and exploitation. How Labour Built Neoliberalism points to the dead-end that is resolving a crisis of capitalism on capitalist terms. This is the strategic value Humphrys’ work brings to the present predicament of the labour movement.

There would be a certain dialectical irony if the setbacks incurred by parliamentarians using their relationships with trade union leaders to rein in industrial militancy and the price of labour were reversed by those leaders using their relationships with parliamentarians. The state, however, should be seen as a site of contestation rather than the vehicle for salvation. In other words, the electoral contest matters but it is not a substitute for the daily workplace struggle. The character of the state is inherently shaped by the economic system and social context it inhabits. ‘Change the Rules’, therefore, cannot just be an electoral campaign aimed at progressive politicians intervening at the level of the state to provide for a better legal regime for workers. It must also be a call to change the very rules, processes, and assumptions by which unions themselves operate so as to forge a new union movement.

This goes beyond union mergers. Humphrys rightly locates the 1990s round of union mergers as an implicit part of the Accord process. Union mergers are a legal procedure empty of meaning aside from the surrounding context and character of any proposal. The present context, I would argue, demands the creation of a new big union hosting a large number of small teams of organisers and delegates with the autonomy and infrastructure necessary to rebuild labour’s social base. It demands that union leaders like myself give up the control over the internal administration of the labour movement we gained in the 1980s in order to win back the worker power that was lost. In a labour relations system where workers are so heavily regulated, this new union could be seen as a Trojan horse spewing forth waves of interdependent actors taking action to win back worker power.

The struggle will be in vain, however, if all its energies are dissipated in yet another attempt to resolve a crisis of capitalism. Good strategy rests on keeping the end-goal in mind and the end-goal is socialism – that is, a society where people can be made whole again and live in freedom. The task of our times, therefore, is organising for ownership. Organising for ownership is that which the labour movement must do in the face of the present crisis of capitalism. Workers should run and own the businesses they work in, and organising for ownership is the process of making the utopian practical. To be sure it is a hard task, but no harder than living through another 35 years of corruption, crisis and, ultimately, extinction.


How Labour Built Neoliberalism by Elizabeth Humphrys is available through Brill.

Godfrey Moase

Godfrey Moase is an Executive Director, United Workers Union. He’s previously written for the Guardian, Overland, Jacobin and New Matilda.

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  1. In response to the review: I Agree that the labour movement needs to organise – and while the parliamentary emphasis has value , we need to go beyond that as well. We need organisation and action at the grassroots. Not sure what ‘organizing for ownership’ meaningfully refers to today, though. It *could* involve subsidies (re: tax and cheap credit) for workers co-ops. And a gradual swathe of strategic resocializations. But remember what happened to Swedish social democracy when it attempted the Meidner funds. We don’t want to dramatically over-reach either. The counter-argument of that is (re: Luxemburg) the working class grassroots sometimes run ahead of their leaderships. Leaderships need to be adaptable to that. Sometimes the grassroots actually overreach themselves ; at other times the leadership is too conservative. Arguably the Austro-Marxists achieved an awful lot ; but they were too conservative strategically to consolidate their hold on the state apparatus of force in 1918-19 ; or to resist effectively immediately as a response to the coup in 1934. There’s the example of ‘the recovered companies’ in Argentina as well. (showing what MIGHT be possible) Everything differs from context to context. But capitalists don’t give in without a fight.

  2. Hawke and Keating were set to play the Neoliberal game from the outset by floating the dollar so allowing the then power movements of world capital to decide the fate of this country (as with others).

  3. I have not been able to read this book, yet. Check the ridiculous prices to see why: https://brill.com/view/title/35076 . (Why Australian academics, esecially in Political Economy, engage in that nonsense is another question.) However, I have listened to the author on a couple of occasions and read some shorter material by her. Godfrey’s is a thoughtful review that does encourage taking the book seriously. For some time I have used the expression “neolaboralism” to describe the unique way in which neoliberalism established itself and developed in Australia. The dominance of laborist thinking and practice in our union movement over decades was the foundation for that. Also, the strategy of the union movement in the seventies, after the defeat of the penal powers in 1969, was inadequate from the point of view of workers. Among other things it was not up to the task of defending, let alone pushing forward, a reforming Labor government. And, the employers, supported by Fraser, were laying new foundations that would strengthen their power. The decline in union density started in about 1978 but would not be worked out by the union movement until the very late 80’s. A strategy that attempted a “new level of intervention” by the working class was needed. That’s what most of the union left was aiming to do from about 1978 onwards. Some remained bogged in “money militancy” for its own sake. There should be a lot more study and discussion about that, especially in the lessons it might offer to a union movement at 12% union density. Strategy is critical. Finally, what the employers were up to throughout these years, as the dominant class in society and how, with that, the capitalist dynamic was unfolding exposed the core problem of laborism. When we see the widespread acceptance among the Change the Rues activists that the parliamentary Labor Party can bring employers into consultations about any new rues for the Fair Work Act, the core problem remains alive and well in our movement. To our detriment.
    , L

    1. There is little choice for early career academics but to publish with expensive academic presses, as a job requirement. I chose Brill because they guarantee a cheap paperback in a year, through Haymarket Press in the US, unlike many other scholarly presses.

  4. Interesting review. I look forward to reading Elizabeth’s book when it appears in paperback.

    I was in the UK in the 1970s and 1980s when the union movement was confronted with neoliberalism – first under the Wilson Labour govt in 1975/76, and then more forcefully under Thatcher after 1979.

    Remembering and understanding the period is important because it illustrated the political weaknesses of Keynesian statism and labourism in very stark terms.

    The neoliberals effectively challenged the Left to offer an alternative to the increasingly obvious failures of Keynesianism (inflation, mass unemployment, a crisis of investment and profitability). But the Left couldn’t.

    After 1945 much of the Left threw its weight behind the Keynesian state as the vehicle for permanent full employment and industrial “modernisation.” By the late 1970s the Keynesian state was manifestly failing to deliver either.

    Understanding the limits and failures of post-war Keynesianism is important because the Left (including Corbyn) continues to offer partial and recycled versions of Keynesianism to this day.

    Organised labour was also involved in making neoliberalism in the UK – but in a much more uneven and fractious manner than perhaps in Australia.

    After the disastrous 1983 election defeat, many of the unions abandoned their prior support for one of the many versions of the Alternative Economic Strategy. Led by the electricians and engineers (among others), “realism” became the watchword of increasing numbers of UK unions.

    One positive aspect of the UK experience is that most unions, despite their increasing fatalism, did not buy into an ideology of national consensus and reconstruction. Many (particularly in the public sector) continued to fight against neoliberalism as a class project. They didn’t always win (although some did). But their struggles did help to cultivate and preserve a layer of experienced and talented workplace activists – without which the UK union movement would be much weaker than it is.

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