Labor, Corporate Power and Neoliberalism

Labor, Corporate Power and Neoliberalism

Op-Ed Essay by Mike Shesterkin, Exec. Dir. SMSBF

This month, our newsletter is focused on “labor”, and I thought it would make sense to wrestle a bit with the more fundamental aspects of our system and where labor fits within it.

To begin, by labor we mean the collective of folks who “do work”. What we think of as work has certainly evolved over the years. As creatures within the Earth system, the work we do with our minds and our backs, and the length of time we spending doing it, is quite varied. What is truly lacking in our day is a well-developed sense and application of justice in how we’re compensated for the work we do. The reason for this is grounded in fundamental, economic systems related flaws.

When it comes to labor, and as the term relates to work, many of us are part of the labor collective in some way or another. We work within classifications of professions; skill sets and types of work. As creatures, we engage in work that is in some way interconnected with the whole of the Earth system. In the least, we eat food, expend calories and produce things. Of course, there are those who cannot work, and in our culture, we care for these. How we do so, and whether it is just, will not be covered here. It’s at least enough to recognize that in our society not everyone can work, and at some level, we make accommodations for this reality.

The notion of work as a human thing is primordial; it is a fundamental an inalterable manifestation of the Earth system itself. What’s left to us to decide is how we organize the work we do, and most importantly, whether that work is done in a manner that seeks social, environmental and economic justice.

For many of us – at least those familiar with punching a clock and performing manual work – the term labor implies “those who perform hourly work”. Hourly work is a fundamental aspect of the capitalist system: The laborer exchanges his or her “labor power” – the work he or she performs over a period of time – for money. In the capitalist system, the money exchanged for labor power is provided by the “owner of the means of production” (henceforth, “owner” or “owners”). The owner can be comprised of a group of individuals (e.g., shareholders) or a single person, or some other similar arrangement.

The amount of money paid to the worker is calculated, not on its “true value”, but on an amount less than that. The money paid to the worker is affected by a number of factors, but most importantly, it is an amount less the profit the owner takes. The owner must extract, or exploit profit from the worker for the purposes of purchasing raw materials, tools, computers, pens and paper, paying the rent and, of course, stuffing his or her pocket.

One of the more puzzling questions of the capitalist system – and it’s one seemingly more elusive than establishing the existence of God –is this: What is an appropriate amount to be allocated to stuff the owner’s pocket? Despite our putting a human being on the moon; producing artful entertainment, such as “Keeping Up with the Kardashians” and creating cool games, like “Minecraft”, we still cannot figure out what makes for just compensation of the owner.

In the capitalist system, the owner is a “private” entity, as opposed to the state. To be sure, we have plenty of folks who are paid by the state and what they do would certainly be considered work. In this case, however, our focus is on what we’re led to believe is a “free market” and the entities that operate within it. In other words, we’re concerned with private entities acting freely and within the confines defined by the laws of the state

Back some 200 to 300 years ago, when “liberalism” was hatched as a philosophical framework –  the same framework that dominates our age as “neo-liberalism”, or the “new” liberalism – thinkers like John Locke, who is considered the “Father of Liberalism”, came-up with the idea that it is economics, or the desire for wealth that grounds human behavior. According to liberalism, provided government and political philosophy “get out of the way”, and people, acting freely and unencumbered, are allowed to pursue wealth with impunity, a harmonious society emerges, one that sees the “pursuit of happiness” evenly realized throughout. In short, the notion that “greed is a virtue” emerged and was let loose on humanity. (1)

As technology evolves, and we figure-out how to industrialize the means of production, we find ourselves in the middle of the 1800’s, when children worked in coal mines – twelve hours per day, six days per week. Far from being something harmonious, or even remotely just, society saw very clear distinctions between owners and labor: the former were clean and wore cravats, while the later were covered in the grime of labor and wore rags. This is the world on which Marx’s criticism of capitalism is based; it’s also the world that established the notion of “corporatism”.

In part because atheist socialists were beginning to win the hearts and minds of labor, the Catholic Church published, “Rerum Novarum”, or in English, “On Labor” in 1891, eight years after the death of Karl Marx. “Rerum” would become the first in the pantheon of “Catholic Social Teaching”.

What “On Labor” did was make clear that private ownership was fine, but so, too, was the ability of the individual worker to organize into entities such as unions. This is the basis of corporatism. According to this framework, two “corporate” entities share power: one is the ownership and the other is the worker, organized in groups (e.g., unions). Workers must be free to organize in unions, otherwise the notion of free will is usurped. Since both sides are free to act, which indicates freedom from state coercion (i.e., laws), the whole thing fits nicely within the framework of liberalism. (2)

Over the past nearly 150 years, the power tension between owners and labor has waxed and waned. From the start of the 20th century, through to the end of WWII, a net flow of power went from owners to labor. At the end of the WWII, and through to the late ‘60’s, union power – at least in the form of benefits and compensation – saw its zenith. Today, some fifty years hence, union power has been eviscerated and is almost negligible; the result is grotesque corporate power that colludes with government. Why is this so? Because folks who worshipped Ayn Rand, and thought Nietzsche had it all figured-out, found a willing ear in the leaders of private business.

It was Milton Friedman, who in 1970 established the theory of “shareholder primacy” and the notion that the social role of business is to “maximize profits”. These asinine ideas took neoliberalism from the baby bottle to adult food. From deregulation, to globalization, to Reagan’s union busting, to mass incarceration, the root cause of just about every social, environmental and economic injustice we endure can be traced to neoliberalism, or the idea that “economic man” is somehow “humane”. Where we see injustice, we can find its roots in the way in which we chose to organize our communal life. In this system, societal organization is not based on a common and shared sense of humanity, and our relationship to the Earth system, but on the size of one’s wallet. When we build our communities, whether local, state or national, around an economy of “things”, then we find ourselves with little sense of justice.

Starting with our shared humanity, doesn’t it make sense that we ought to at least have just access to clothing, shelter, food and the other necessities of life? How ‘bout freedom from oppression? When we see the injustice perpetrated on folks such as George Floyd, do we stop and ask ourselves the extent to which – in this system – poor folks are treated differently from rich folks. Don’t get me wrong, racism is a real thing: we must recognize it and root-it-out. But if we only look to racism as explaining injustice, we fail to see how this system of economics is destroying our sense of what is humane, along with the very thing that gives us life.

Liberalism, and its grotesque recapitulation as neoliberalism, literally says the acquisition of property and wealth is the most effective way of sorting out how we ought to live together. I hate to point this out to folks who would die to save neoliberalism, but it’s a 250-year-old philosophy that emerged at a particular point in Western history, and under a particular set of circumstances. We must move on.

There are compelling criticisms of liberalism, about which far, far too many of us are unaware. This is because, in the US, rather than critically and rationally evaluating what these criticisms have to say, we’ve made it a sport to vilify people who call themselves socialists. Of course, what better way for those in power to dupe the rest of us into willingly giving up the very thing that could level the playing field – our sense of shared humanity – than to convince us that “being free” to act as “economic individuals” is the best way to secure our future. (3)

To bring about social, environmental and economic justice, we must begin the long and arduous task of dismantling the corporate state, as it is manifest in the grotesque and incestuous relationship between the aggregated wealth of large, private corporations, and the national government.

Next, we must establish local, vibrant economies, reduced to a “human scale” and not predicated on wealth aggregation, but on the collective will of “we, the people”. We must do away with an 18th century view that sees all human activity as motivated by greed. We must see that it is in community, at a local level and made manifest among brothers and sisters of all colors, faiths and beliefs who aspire not to hate,  but to love, that power ought to be grounded. Further, we must recognize that power springs, not from the size of one’s wallet, but from the polis – the human scale community – where values and customs, centered on seeking social, environmental and economic justice, will emerge.


  • Wolin, S. S. (2016). Politics and vision: Continuity and innovation in western political thought. Princeton: Princeton University Press.
  • Massaro, T. (2016). Living justice: Catholic social teaching in action. Lanham: Rowman & Littlefield.
  • See the work of Richard Wolff

About The Author

Join SMSBF Today

Are you interested in learning about improving job quality, lessening harm to the environment and how these things can lead to more business? If so, click here!

Scroll to Top