The pseudo-private corporations of the United States and the pseudo-public firms of the USSR have this much in common: neither comes close to achieving “industrial democracy.” As an organizing principle, hierarchy seems to have won out over democratic participation.
Probably the most radical alternative to the American and Soviet methods of governing economic enterprises is the system of self-management that has been developed in Yugoslavia since 1950. Yugoslavia is the only country in the world where a serious effort has been made to translate the old dream of industrial democracy into reality—or into as much reality as dreams usually are. Let me add at once that in the government of its state apparatus, Yugoslavia is not, of course, a representative democracy. The leadership has not yet permitted an opposition party to exist; as the famous cases of Djilas and Mihajlov show, merely to advocate an opposition party may land one in jail. Yet if Yugoslavia is less democratic than the United States in the government of the state, it is more democratic in the way industries and other enterprises are governed. In both respects, of course, it is much more democratic than the USSR.
In fact, it was after Yugoslavia broke out of the Soviet orbit that her leaders introduced social self-management1 as a deliberate and systematic effort to shift from the orthodox, highly centralized, bureaucratic Soviet-style socialism toward a socialism that would be more democratic, liberal, humane, and decentralized. During their brief revolution in 1968, the Czechs also moved rapidly toward decentralized socialism. Beginning in June, 1968, elected councils were established within a few months in several hundred firms, including the Skoda works in Pilsen, the largest in Czechoslovakia. But after the Russians moved in, this dangerous challenge to bureaucratic socialism was suppressed and the radical idea of self-management was attacked as anti-socialist; the only appropriate representative of the workers was, naturally, the party.
Although in Yugoslavia the most dramatic step toward industrial democracy and the one most relevant here was the introduction of workers’ councils throughout all economic enterprises,2 the principle of social self-management was gradually extended to include practically every kind of organized unit—local governments, rural coops, schools, hospitals, apartment houses, the post office, telephone services.3
It would be a gross exaggeration to say that self-management of economic enterprises in Yugoslavia is a complete or wholly satisfactory achievement of industrial democracy. But, in conjunction with other aspects of the Yugoslav system, about which I shall have a word to say in a moment, the workers’ councils seem to have produced not only a relatively decentralized economy but a substantial amount of participation by workers in the government of industry and of work generally. To be sure, the workers’ councils are by no means autonomous; here as elsewhere in Yugoslavia organized party opposition is not permitted; strikes are rare and of doubtful legality; and the special influence of the party is important. Nonetheless, it seems clear that the councils elected by the workers are…
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