BACKGROUND AND ANALYSIS
After more than twenty years of technological revolution, futurologist’s hopeful promises are far away from being accomplished.
Information technology and automation wonders continue to amaze us with new devices, faster, more compact and easier to handle, all of which have provided a fantastic increase in productivity for human beings.
But that astonishing number of prodigies has not succeeded, as we can see, to improve people’s quality of life.
The market has proved to be a tremendous strength to push for innovation, to develop productivity factors and to create a huge amount of consumer goods.
All that wealth should be far enough to supply largely satisfactory living standards for all citizens of the world, without exception.
However, technological innovations, in a competition system, force the companies to produce an effect exactly opposite to the one that should be expected.
When an enterprise purchases a new generation machine, which allows the firm to be ahead in terms of productivity, it will obviously use that technology to produce more, and with lower costs, than its competitors. Never, not even for a second, the employer will think that, now that he and his workers are all more productive, they could alleviate their daily effort, shortening the working shifts in order to enjoy the benefits of technology. In that case, he would be disabling the advantage he has just obtained. He would be, related to his competitors, in the same position as he was before. He would produce the same amount of merchandises, at the same cost, even with less effort.
It would be nonsense to purchase new machines, if we were not going to get an increase in productivity in order to improve the quality/price ratio and, in that way, to get a bigger slice of the market cake.
No enterprise would do such a stupid thing.
However, that is precisely what society needs that be done.
The change that companies are incapable to make individually is, precisely, the one Society has to make, for everyone’s welfare.
KEY AREA FOR CHANGE
This huge nonsense, of historical proportions (and, however, dismissed by contemporary Economics), has disastrous consequences for human society. We could say that the main economic and social problems that now afflict the world are related to this absurd disconnection between technological progress, on the one hand, and working shifts, on the other.
Information technology revolution, which began, with so optimistic forecasts, two or three decades ago, has led to the greatest wave of lay-offs we have ever seen, increasing the number of unemployed people to hundreds of millions.
The simple existence of this enormous army of hungry unemployed people puts a formidable pressure over the ones who still have a job. The last ones, yielded by fear of losing their jobs, and by the threat of closure and offshoring of factories, surrender themselves to the pressure of employers to cut off their wages, raise job precarity and lengthen work shifts, configuring what has been called the “race to the bottom”, a sinister worldwide contest that is devastating the whole planet, from the miserable slums of the third world to the most important cities of the United States and Europe, not to mention the vigorous industrial centers of emerging countries.
It is easy to deduce that, in such a scene, crime, juvenile gangs and drug addiction have the best ground to get a sustained increase, seriously threatening public safety and making more somber the future of new generations.
PROFIT RATE AND FINANCIAL SPECULATION
As if all we have mentioned was not enough, Capital is developing a frenetic spiral of financial speculation and tax evasion, the results of which we have clearly seen in the stock markets crisis of 2008.
Great technological changes bring about a consequence from which Capital cannot escape. More technology means less human work participation in the production process. The huge and growing Capital mass is composed of one part, each time bigger in proportion to the total, which is called constant capital (machinery, raw materials, buildings, etc.), and another part, each time smaller in proportion to the total, which is human work (represented, in Capital, by the value of wages, which is called variable capital).
But this change in Capital’s inside composition has a consequence: the profit rate tends to fall.
The reason is that, considering human work is the only one that gives new value to merchandizes, and considering that, on the other hand, machinery does not produce new value, but only transfers his own value to product, from this relationship we can conclude that, as human work diminishes his share in the production process, creation of new value is also going to diminish (measuring this share in proportion of total Capital, of course). The profit rate, because of that, diminishes also.
When Capital finds itself dragged by that somber force which impeaches it to support its profits, it will try to fight against that with all his means. It appeals then, as we have seen, to lengthening and intensifying work shifts, to precarizing work in order to reduce costs, to making massive dismissals and, finally, to speculating in financial markets. All that, as we have said, in the aim of counteracting to the profit rate’s tendency to fall.
NEW RULE: WORK SHIFTS IN PROPORTION TO PRODUCTIVITY.
Good news, in the middle of this apparently no-escape situation, is that there is a way out. Illness is reversible, and the solution is perfectly at arm’s reach.
The four-hour day should come to counterbalance the huge gap, accumulated in the last decades, when, as we have seen, productivity has more than doubled, while work shifts, instead of being shortened, have lengthened more and more.
Worldwide introduction of the four-hour day should mean almost immediate achievement of full employment, which is, by the way, the first and definitive step toward disappearing poverty from the face of earth.
NEW ECONOMIC STABILITY
Besides the previously mentioned benefits, the reduction of work shifts has the advantage of disallowing what, as we said, is the main cause of economic problems: the decrease in profit rates.
When a company introduces technological advances in its production process, this causes, as we have seen, a raise in constant capital (machinery, royalties, buildings and raw materials). If we could, together with that raise, generate a decrease, in exact proportion, of work shifts, and we compensate this decrease with a raise, again in proportion, in the number of workers, we should obtain, then, an increase in variable capital (as variable capital is composed of wages).
In figures, the process is as follows:
If we have a constant capital (C) of 400, and we make an investment in new machinery, in order to raise productivity, and, as a result of this investment, constant capital (C) increases to 500, then we should cut work shifts in the same proportion. That work-shift decrease will mean, automatically, an increase in the number of workers, because the company will need to hire more people to compensate for the shortened working hours. If we had 100 workers, now there will be 125 (and, if variable capital (V) was 100, now it will be 125).
If constant capital (C) has risen by 25% (from 400 to 500), and variable capital (V) has also risen by 25% (from 100 to 125), then we have supported the proportion between both parts of Capital. In other words, we have reversed the cause of the decrease in the profits rate.
Table I shows profit-rate stabilization at 20%, when raises in constant capital come together with simultaneous raises in variable capital.
C V p g
(constant capital) (variable capital) (added value) (profit rate)
400 100 100 20%
500 125 125 20%
600 150 150 20%
700 175 175 20%
There is still another advantage, in the middle of this fortunate chain of positive effects, and it is that we can get all of them at zero cost.
In order to establish the four-hour day we don‘t need to provide huge amounts of money to help the poor, or to elaborate complicated and expensive feasibility studies, or to design sophisticated projects, or to make budgets, or to recruit and train brigades of volunteers who are going to the field, and all that to find out, when help finally arrives to the target groups, that half of the money has been spent in the way.
Some could say that our proposal really has a cost for enterprises, because they will have to increase their payment rolls. But logic and historical experience have proved that fear is unfounded.
Each new worker hired by any company is, at the same time, a new consumer. By hiring more people, companies are increasing the market for their own products.
Each new worker comes, therefore, with his own bread in hands.
A VIRTUOUS CYCLE
In other words, what we are going to establish with the reduction of work shifts will be a compensation system between factors of production; a virtuous mechanism that allows all technological advance (which, as we know, produces a productivity increase), to also lead, in exact proportion, to shorter work shifts (which means more leisure for all the people), more employment (new workers will be hired, as we said), and a stable profits rate for enterprises.
It will be enough to establish, as a worldwide order, the reduction of work shifts to four hours, to have all the demented present state of things finally reverted, and to start moving towards this virtuous cycle. Then we will have, as a chain-effect reaction, all the benefits that are the exact reverse of the ills today are distressing us: we are talking about full employment, stable profits for enterprises, leisure time and a better quality of life for all citizens. And as a result of all that, a decrease in anxiety and insecurity that are pushing great population sectors, especially young people, to gangs, crime and also terrorism.
To allow this new and positive welfare impulse to endure, it will be necessary to institutionalize work-shift reduction as something periodical and progressive.
After a certain amount of time (it could be each decade), the productivity increase that has occurred during that time will be measured, and then, it will automatically be established an equivalent, and exactly proportional, reduction in work shifts.
That will be done in order to prevent the benefits of work-shift reduction to be erased by new productivity increases, something that could happen, obviously, as a result of constant technological progress.
Besides solving the world crisis –which, by the way, is not a small thing– work-shift reduction would become, finally, the entry door to a totally new age of human progress. What we are talking about is, no more no less, the beginning of our true liberation. We will not live any more to work, but to be free citizens, masters of our time and, because of that, of our destiny.
POTENTIAL ACTORS AND IMPLEMENTATION STRATEGIES.
Potential actors of this change are the workers of the world, simple citizens, all human beings who live from selling their labour force, that is, the biggest and most powerful strength that exists in the whole planet, the sleeping giant, the only one capable of reverting the present state of things.
In order to achieve it, we have to organize a worldwide movement oriented to finally make a worldwide strike –totally pacific and democratic, of course– through which, in a few days or weeks, we should obtain the four-hour day, together with an agreement of additional periodical reductions, adjusted to future productivity increases.
Work-shift reduction has the virtue of being a specific request, tangible, comprehensible and easy to obtain. To get that should mean to put the economy at the service of human beings, instead of continuing to be its slaves.
It is the key request to bring together, surrounding it, the whole diversity of cultural, environmental, gender, minorities and alternative globalization movements, if we take into account that its realization should be such a big victory, enough to completely change the forces of correlation in the world, establishing a new citizen power, upon which we could obtain a chain on new victories, all of them oriented to the attainment of a more democratic and free society.