Guild Socialism

During medieval Europe, Guild system has emerged as a part of the diffused power structure. Guild refers to ‘association of merchants and craftspeople in medieval Europe, formed to give help and advice to its members and to make regulations and set standards for a particular trade.’¹⁰⁸ Each member of an autonomous Guild owned the instruments with which he worked, and determined the nature and extent of his work. Many of the ideas of the pluralists, like role of groups and dispersal of power, were influenced by the medieval Guild system and their autonomy. In the late nineteenth and early twentieth century, while pluralism was gaining its momentum against the constituted authority of the state, writers like A. J. Penty in his book The Restoration of the Guild System advocated ‘a return to the medieval principle of self-government in industry.¹⁰⁹ The idea of organizing industry on the basis of craftsman further emerged in the form of the argument that the decision-making structure either in economic or political field, should be organized on the professional or occupational basis. After Penty, S. G. Hobson, A. R. Orage and significantly, G. D. H. Cole contributed to the Guild Socialist theory. Cole in his book, Self-Government in Industry, advocated a clear-cut theory of self-government in industry by the workers. We find that Laski also advocated industrial federalism and was sympathetic to the Guild Socialist cause. Figgis, in fact, thought that Guild Socialism was a form of pluralism and might be successfully practised.¹¹⁰ It may not be inappropriate to mention that Guild Socialism as a trend was primarily confined in Britain.

The Guild Socialist theory can be said to be a critique of the theory of state and sovereignty in two ways. Firstly, it advocates industrial democracy, i.e., self-government in industry so that industry is administered by the workers and rejects any role of the state in industrial and production functions. As we will see below, Cole denies any role to the State in production and industrial matters and also rejects any coordinating role to the State. Secondly, it also enunciates the principle that ‘power and responsibility in society should be related and proportional to the importance of the functions which individuals perform in the service of the community.’¹¹¹ Thus, as a reaction against a centralized and all-embracing State, it advocates devolution of powers and functions to a number of different bodies in the form of functional democracy. Functional democracy implies representation on functional criteria and not merely on territorial criteria.

Cole’s book Self-Government in Industry by advocating industrial democracy was also an implied criticism of Collectivism and State Socialism. Both, Collectivism and State Socialism supported the state’s role in the industrial and production field. Cole thought that the state is the most unsuitable agency for conducting industrial activities. This unsuitability arises from what Guild Socialists say evils of bureaucracy and its conducting public-owned industry in a manner organized from above. Instead, they say control of administration of industry must be organized from below. Further, this exclusion of the State from industrial and production activities is also premised on the reasoning that ‘those spheres of social action which affect different members of it in different degrees and in different ways’¹¹² should be excluded from the primary function of the state. As production is largely related to respective workers, the State should not interfere. Cole divides the activities in what the state can control, like consumer activities (income, prices) and political activities, and which it cannot control like economic activities, production and coordinating functions. Not only Cole restricts the State from production activities, he denies any coordination activity to the State.

Cole regarded the state as an association of consumers and as one of many associations. He held that the State ‘ought not to be dominant over other associations which represent men in their different capacity as producers, fellow-worshippers, common believers, etc.’¹¹³ Like pluralists, Cole supports the existence of variety of groups and associations as representing affiliations of individuals. As such, in Guild Socialism, the State would be relegated to ‘the role of an association of consumers, representing a number of bodies elected on national basis for the purpose of negotiating with the big producing Guilds.’¹¹⁴ As compared to pluralists like Barker, Lindsay, Follett and Laski who conceded coordinating function to the state, Cole gives no coordination or adjusting function to the State and hence no sovereignty. He says, ‘To entrust the State with the function of coordination would be to entrust it, in many cases, with the task of arbitrating between itself and some other functional associations.’¹¹⁵

S. G. Hobson also thought the state as an unsuitable agency for economic functions and running the industry. However, he assigned legislative and executive functions to the State like civic amenities, taxation, education, health, protection, etc. Moreover, unlike Cole, Hobson allows sovereignty of the State over the guilds when he says, ‘we remain socialists because we believe that in the final analysis the State as representing the community at large must be the final arbiter.’¹¹⁶

The theory of functional democracy is applied by the Guild Socialists both in industrial as well as political spheres. Industrial activities and production should be organized in the form of a National Guild and similarly in the political sphere, there should be provision of functional representation where all interests of society are represented. Thus, producers’ guilds, consumers’ councils, cultural councils, health councils, etc. are advocated. In general, all these functional interests are conceived to federate locally and regionally. According to Cole, producers and functional interests federated as such would result in National Guilds and would be the basis for a National Guild Congress. On the other hand, consumers’ interests and interests which are national affairs affecting equally all the inhabitants like taxation and law, defence, standard of education etc., could be represented on geographical basis. Joad, understanding Cole in the latter sense, adds, ‘men’s will in respect to them are best represented on a national body not dissimilar to the existing parliament.’¹¹⁷ Thus, we have a National Guild Congress and a Parliament as representative bodies both representing two streams of interests and as a check on each other. But for Cole, none is sovereign, ‘Neither parliament not the Guild congress can claim to be ultimate sovereign: the one is supreme territorial association, the other, the supreme professional association.’¹¹⁸ Thus, we find that Guild Socialism, seeks to limit state power and its sovereignty.

We may mention here that Sydney and Beatrice Webb, Fabian Socialists, also conceived of two parliaments namely, ‘Social Parliament’ and ‘Political Parliament’ on similar lines. However, it would be very difficult to divide the interests of individuals as such. It may be mentioned that in some of the existing parliaments, for example in India, some representation is ensured on the basis of various interests in terms of culture, social service, industry, etc.

We should not forget that the Guild Socialists were arguing from the Marxist perspective that ‘economic power precedes political power’ and thought that production and economic activity must be in control of the workers and producers. Based on their understanding of the economic relations, they argued for a limited state intervention on behalf of the consumers and territorial based interests. As such, we can say that Guild Socialism, on the one hand, supports the pluralist idea of recognition of a variety of interests in society and on the other, deals with the aspects of class nature of economic relations, which pluralism lacked. It advocates a higher degree of opposition to the State and its sovereignty than pluralism. And this happens primarily due to the shift from a liberal framework to which pluralism remains committed to a Marxian framework which Guild Socialism espouses.