The Myth of Collective Management

Park Slope, Brooklyn, is one of those neighborhoods that all Brooklynites (I am one, born and raised) know of, both in location and reputation, even if they’ve barely ever set foot there. Its current reputation is as the epicenter of new-monied NYC wokeness (the old Brooklyn money lives in the Heights), and the place to raise your kids if you’re of that bent and those financial means.

Today, it provides a cautionary tale in the face of the emergence of what is being called Democratic Socialism. One element of this supposedly new incarnation of collectivist thinking and governance is “social ownership,” which is explained at the Democratic Socialists of America website:

Social ownership could take many forms, such as worker-owned cooperatives or publicly owned enterprises managed by workers and consumer representatives.

As a prototype for this idea, we can look to the Park Slope Food Cooperative, where “members” get to shop, exclusively, in exchange for a couple hours a month in labor. Apparently, not all is well in socialist Kumabaya. The full-time employees, who one unfamiliar with socialism’s long history might dream would find themselves very well treated because there’s no evil capitalist overlord exploiting them, are reportedly not happy. They’re unhappy enough to be seeking to unionize, and, in a deliciously ironic twist, their “iron-fisted” management is opposed.

This is not the first time there’s been some selfish non-kumbaya there, with a report from 2017 that a couple administrators flew to Paris on the co-op’s dime.

Are you surprised by any of this? I’m not. This is human nature, and human nature is incompatible with collectivist kumbaya fantasies.

In the under-appreciated Mel Gibson action flick Payback, Gibson’s character Porter, seeking reimbursement from a criminal organization, works his way up the management ladder, and in an exchange with the #3 man, Carter, cuts to the reality.

Carter: We’re not authorized to do things like this.
Porter: Who is? Who makes the decisions?
Carter: Well, a committee would make the decision in this case…
Porter: No. One man… you go high enough you always come to one man… who?

It may not always be just one, but any grouping of individuals bent to a common purpose will, over time, sort itself out into a leadership structure. And, as anyone who’s ever worked in a big company knows, committees are where initiatives and decision-making go to die.

Decisions are the bread-and-butter of any economic enterprise, and they are what executives get paid for. Bad decisions can ruin companies, and even if companies survive bad decisions, they can ruin individuals’ careers. Making a decision is taking a risk, and many people are uncomfortable, if not wildly averse, to making decisions that carry risk. Indeed, this is parodied in the movie Head Office, where a young Judge Reinhold is offered some sage advice by a mentor:

The secret to survival is never make a decision.

The movie then cuts to a manic Rick Moranis screaming into his phone that he “never made that decision. I approved somebody else’s decision!”

This advice and predilection hold true for, I think it’s safe to say, most people in the work place, at least when it comes to the big, difficult, expensive decisions that a handful are expected to make.

Most, but not all. Some aspire to leadership, or power, or decision-making. Their reasons vary, but those reasons don’t matter much – the aspiration does.

This all lies within the spectrum of human nature. Each of us can exercise our will and override our predilections, but in the aggregate, human nature wins out. Groups will organize themselves into hierarchies (and, if large enough, sub-hierarchies, fiefdoms, cliques, klatches, etc), with some taking some degree of leadership, some actively supporting certain leaders (but not others), and some preferring to put their heads down to do their work and steer clear of office politics.

There’s a reason that businesses throughout the world and throughout history have organized in a hierarchical fashion: it’s how human beings behave naturally. It speaks to a near-inevitable outcome of any attempt to impose a cooperative organizational structure universally. It may work in some instances (and even then, as the Park Slope co-op shows, it won’t be a true cooperative, but instead will (d)evolve to a hierarchy), but mostly it’ll become that which it set out to counterweigh: companies managed by a small number of people willing to make decisions. The laws of supply and demand will hold sway, and the few that are willing (and capable – not everyone has the talent and skills to run things well) will be compensated better than the many who aren’t.

Collective management schemes are intellectualist fantasies, perhaps born of some sense of superiority over the people who make decisions under the naturally evolved capitalist system and an anger that they aren’t being sufficiently lauded for their intellectual gifts. They want to organize society in a manner that’s contrary to how society wants to organize itself. They’ll point to the occasional example of cooperative ownership success, and say “see, it can work!” They lose (or ignore) the fact that those cooperatives are voluntary, not imposed by government coercion, and the ignore the fact that many people simply don’t want the responsibility that goes with major decisions.

In fact, that is the great failing of socialists: the idea that something that occasionally emerges via voluntary associations can be imposed, with good outcome, on a large scale via government coercion. As I noted earlier, an individual can override his predilections, but human nature always dominates in the aggregate. The freedom to sort ourselves as we wish allows things like the Park Slope food cooperative to emerge and stick around for a while, but it’s a self-selecting entity, and not one that society as a whole would function under to the exclusion of others.

The government we libertarians aspire to is one that protects us, individually, from the worst bits of human nature. The government that socialists aspire to is one that pretends human nature does not exist.