Harry Quelch December 1908

The Co-Partnership Fraud

Source: The Social-Democrat, VOL. XII., No. 12, December, 1908, pp.529-532, (1,292 words)
Transcribed: by Ted Crawford.
Markup: Chris Clayton

The annual meeting of the Labour Co-Partnership Association once more calls attention to one of the subtle methods by which the capitalists, or the more astute among them, seek to disguise the class war and to disarm the working class. Among much that was trite and platitudinous in his presidential address, Mr. Balfour clearly stated the object of the movement in saying that they wished to “soften or obliterate the divisions between employer and employed.” It is, of course, no question of removing those divisions or their causes — those are inherent in a system which sharply divides society into two classes, the propertied and the propertyless, master and slave, owner and owned, employer and employed. But those divisions may eventually lead to revolt on the part of the subject class unless they can be softened or bridged over by a seeming identity of interest, and co-partnership offers an excellent means for such softening and bridging over.

Mr. Balfour was willing to admit that the lot of the worker is not “all lavender.” This is a notable admission in these days, when it appears to be universally supposed that all that a workman needs is work and plenty of it. Mr. Balfour, however, while he admits that a life of penury and toil has its draw­backs, and while he would have to admit that none of his own class would be eager to share such a life, was anxious to show that it has its compensations, and that it might be made more agreeable if the workman were made to feel he had a greater interest in the industry in which he was engaged by the institution of co-partnership.

People talk of co-partnership, he said, “as if it was simply a movement to avoid contests between capital and labour, culminating occasionally in strikes, or as if, on the other hand, it was simply a movement to induce workmen to be more energetic and less wasteful in carrying out the work for which they are paid.” Those, he thought, were most excellent objects, but he did not support the movement because it is immediately going to show results in the balance-sheets of employers or companies. He would recom­mend it on much profounder grounds. “In our ordinary speech,” he said, “we lose a great deal by talk­ing as if the labour of a man whose life is devoted to labour was in itself an evil, but which becomes tolerable because he is paid for his labour, and that the payment he receives for his labour can be used to amuse him, or support his family, or in some other way when the hours of labour are over. There is an element of truth in that, but I am quite certain that that element of truth is grossly exaggerated in ordinary speech.” The art of life, he went on to suggest, is to make uninteresting parts into an interesting whole; and this, it appears, is to be accomplished by co-partnership!

Sir Christopher Furness, who followed Mr. Balfour, and who has just succeeded in imposing a system of co-partnership on the men employed by his company, made no attempt to follow the President in his disser­tation on the loftier aims of the movement. He, on the contrary, was brutally frank. For him the object of co-partnership was industrial peace — the suppression of the right and the power to strike, and the preven­tion of strikes and lock-outs. It must have made the chairman, Mr. Shackleton, writhe in his seat, to hear this braggart plutocrat boast of the army of 37,000 workpeople whom he and his company employed, who wasted the substance of the company and frittered away their own opportunities and their own wages by idle, vexatious and unnecessary strikes. Co-partnership, he declared, would have no reasonable chance in the great industrial concerns of this country unless the possibility of striking was entirely removed, and he made it clear that he supported co-partnership solely on the ground that he believed it would achieve that object and make a strike impossible.

This must have been good hearing for the trade unionists present, and for those who have fallen into Sir Christopher’s trap, seeing how clearly the trade unions generally recognise the vital importance of the principle of the right to strike, and how strenuously they have fought to maintain that right. Yet, Sir Christopher is perfectly correct in his view of the advantages of co-partnership to his class. Properly applied, as Sir George Livesey discovered, it makes strikes impossible and trade unionism futile. Under co-partnership every workman becomes a shareholder in the concern. Generally he acquires the shares by way of bonus on extra energy or diligence, or in return for deduction from his wages. Once a shareholder, his interests, he feels, are bound up with those of his employers. Like Desdemona, he henceforth “sees before him a divided duty” — that which he owes to himself as co-partner in the business, and that which he owes to himself as workman, and the former — seeing that his employment, his very existence, depends upon the good-will of his employers — his co-partners — generally outweighs the latter. Thus, no matter how rigorous may become the conditions of his employ­ment, no matter how exigent may be their demands, he must submit, he dare not revolt or strike. He is absolutely chained for life, or as long as the firm — of which he is a co-partner — can make a profit by employing him. When a term comes to that possibility, as come it must, he is turned adrift, just as though he were not a co-partner at all. His co-partnership will not help him, except that, of courser he will be entitled to the dividend or interest on his share, or to the purchase price with which his co-­partners, or anyone else, may choose to buy him out.

It may be that a frugal, industrious workman in favourable circumstances would acquire as much as a hundred pounds worth of stock in the firm in which he was employed. At 5 per cent. — the Furness co­partnership, I think, guarantees 4 — that would bring him five pounds a year, or, say, a couple of shillings a week. Yet, for the sake of this 5 per cent. as co-partner, the fortunate workman would have to acquiesce in a reduction of 10 per cent. or more in wages if a fall in profits gave any excuse for such reduction. As a co-partner, he would be a capitalist concerned in conserving the profits of his firm, even though, as a workman, he was condemned to go short of food in order to safeguard his interests as capitalist! It is a splendid method for binding the workman to the capitalist with hooks of steel, this blessed co-partnership!

The idea which appears to have been in Mr. Balfour’s mind, that co-partnership goes to the root of the existing industrial antagonism, or offers any solution to the social problem has, of course, absolutely no foundation. While strikes and lock-outs, as any other form of war and waste, are bad in themselves, they are essential to present-day economic conditions. It is only by all kinds of most woeful waste that the industrial machine is kept going. If it should be successfully adopted, and there is no reason why it should not be, Labour co-partnership will only serve to intensify labour, increase productivity and the consequent production of wealth, widen the dispro­portion between the wealth which labour produces and that which it receives, and immensely add to the num­bers of the unemployed and to all the evils unemploy­ment involves. That is why Labour co-partnership is a fraud upon the workers.