# 1922 Encyclopædia Britannica/Guild Socialism

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GUILD SOCIALISM, the name given to a school of socialist thought which originated in England early in the 20th century, and has since spread to other parts of the world, particularly to the English-speaking countries—the United States, Australia, New Zealand and South Africa—and to Japan. As its name implies, it had, in the minds of those who originated it, a definite relation to the forms of industrial organization which existed throughout the mediaeval world, and it was an attempt to apply to the solution of modern industrial problems certain of the principles which were in active operation in the economic organization of mediaeval society. This does not mean that Guild Socialism is an attempt to restore the mediaeval guild system, or that it has any necessary relation to the restoration of a system of hand craft in place of the modern system of machine production. In harking back to the mediaeval organization of industry, Guild Socialists for the most part have in mind not the forms of production which prevailed in the Middle Ages, but the mediaeval principle of industrial self-government.
The origin of the Guild Socialist movement is to be found in The Restoration of the Gild System (1906), a book written by A. J. Penty, the well-known architect and craftsman, and in an article published at about the same time in the Contemporary Review by A. R. Orage, editor of the New Age, which was, during the following decade, very closely associated with the guild propaganda. In both these articles Guild Socialism appeared in an essentially preliminary form, and the emphasis was laid, far more than by the more recent guild writers, on an actual restoration of the mediaeval system. Mr. A. J. Penty, who has perhaps the best claim to be regarded as the originator of the modern guild movement in this form, took the craftsman's point of view and set himself in direct hostility to the modern systems of large-scale production and trading.
From 1906 to 1912 the guild idea developed gradually and almost unnoticed in the columns of the New Age; but during this period a gradual transformation of the theory was taking place, and the emphasis was coming to lie, not upon the return to craft organization or the restoration of a system closely similar to that of the Middle Ages, but upon the utilization of the modern trade-union and working-class movement as the basis for a system of industrial self-government, directly related to modern conditions and to large-scale production. During this stage the propaganda for the “restoration of the gild system” was developing into the propaganda of National Guilds, the emphasis on the word “National” indicating the necessity for a different kind of guild system corresponding to the “National Economy” of modern times.
This transition was made definite, and the first attempt to expound the new guild theory as a complete system of socialism began to be made in the New Age in 1912, when a series of articles, subsequently reprinted in the volume, National Guilds, which was written by S. G. Hobson, and edited by A. R. Orage, was published week by week. It was with the publication of these articles that the guild theory first became a definite force in the British socialist movement.
While this process of theoretical development was going on the situation in the British industrial world was rapidly changing. The earlier years of the 20th century were years of comparative industrial tranquillity, during which the main attention of the working-class movement was concentrated on political questions and on the building-up of the Labour party. From 1909 and 1910 onwards, however, a big wave of industrial unrest passed over the country. Big strikes broke out in a number of the most important industries, and a great stimulus was given to the movement for wider industrial combination. This industrial ferment also served to arouse a corresponding ferment in the realm of ideas. New socialist theories, based mainly on the working-class industrial organizations, sprang rapidly into prominence, and in particular the “Industrial Unionist” ideas, which had entered Great Britain from America a few years earlier, and the syndicalist ideas derived from contemporary developments in the French labour movement, gained for a time a large number of adherents and excited vigorous controversy. It was in the midst of this controversy and of this industrial ferment that the guild idea developed from a “Utopian” plan for the restoration of mediaeval conditions into the outline of a practical policy of industrial self-government, appealing particularly to the British organized working-class movement. The transition, however, was not fully completed with the publication of the “National Guilds” series of articles in the New Age; for the influence of the New Age, although it was during these years steadily growing, reached only a comparatively narrow circle of intellectuals in the middle and working classes. It was when a group of the younger men took up, from 1913 onwards, the wider dissemination of these ideas, particularly through the then newly founded Labour paper, the Daily Herald, that the movement began to exercise an influence over larger circles. This wide appeal, moreover, also resulted to some extent in a transformation of the Guild Socialist theory itself. The theory became steadily less Utopian and remote; and its advocates applied themselves more and more to a study of actual, pressing trade-union problems, and to the working-out of proposals for the “next steps” to be taken.
Up to this point the guild movement had remained entirely unorganized, save for the small degree of cohesion secured through the medium of the New Age. It was in 1914 that the idea of creating an organization for the propaganda and study of Guild Socialism in England first took shape at a private conference of the younger Guild Socialists. This led, at Easter 1915, to the formation of the National Guilds League, which immediately set on foot an active propaganda in the working-class and professional movement. There is no doubt that this propaganda was largely helped by the conditions of war-time industry. Workshop problems were constantly arising owing to the operation of dilution and to war-time changes in the
methods and forms of production. This situation served to awaken a critical spirit in the workers, and made them more ready to listen to plans for a change in the industrial system.
It is legitimate to say that by 1921 the guild propaganda, while it had not made any direct appeal to the larger masses of the workers in Great Britain or other countries, had come to exercise a powerful influence over a steadily growing number of the younger local and national leaders of the Labour movement and in the professions. This influence could be seen in the changing policies and programmes both of trade unions and professional associations and of socialist societies. For example, the Miners' Federation, which before the war advocated a measure of nationalization of the mines which would have placed them under direct State administration, laid before the Coal Industry Commission, in 1919, a scheme which was in substance an adoption of the Guild Socialist proposals for industrial self-government. Similar influences have been at work in other industries, notably in the post-office, on the railways and in the building industry. The influence of the Guild Socialist propaganda has also been considerable in the professions, and especially in the teaching world; while in the sphere of socialist organization the policy and programme of the Independent Labour party, the Labour party and other organizations have been largely changed so as to incorporate the idea of control of industry by the workers more or less on the lines advocated by the Guild Socialists.
The National Guilds League, which is the only organization directly representing the Guild Socialist movement in Great Britain, defines its objects in the following terms: “The abolition of the Wage System, and the establishment by the workers of Self-Government in Industry through a democratic system of National Guilds, working in conjunction with other democratic functional organizations in the community.” An examination of this definition will serve to indicate clearly the main ideas upon which Guild Socialism is based.
The central idea, undoubtedly, is that of self-government in industry. The guild propaganda is above all connected with the advocacy of a change in the system of industrial administration which would result in placing the power and responsibility of administration in the hands of the workers engaged in each particular industry or service. Guild Socialists have always stressed the point that by “workers” they mean not simply the manual workers engaged in industry, but the whole necessary personnel. Indeed, the oft-used phrase “workers by hand and brain” seems to have been coined by the Guild Socialists, and was used by them from the beginning of their propaganda. They have stressed, moreover, not only the need for common action by all the workers “by hand and brain,” but also the need for the recognition, in any form of democratic industrial organization, of vital functional differences between one grade of workers and another. The democracy which they have advocated has been not the government of industry by indiscriminate mass voting, but a system in which power and responsibility would be definitely related to the particular function which each individual or group of individuals is called upon to fulfil in the service of the community.
The central idea of Guild Socialism is thus the idea of functional democracy, or, in other words, the application of democratic principles to the organization of all forms of industry and public service. This advocacy is closely combined in Guild Socialist propaganda with a critique of the current conceptions of democracy. Guildsmen are fond of pointing out that the present forms of democratic organization, which may be called, for short, “parliamentary democracy based on universal suffrage,” are not in reality democracy at all, and do not in fact provide for the direction of the affairs of the community by the positive wills of its members. They urge that it is useless to look for effective democracy in the political sphere as long as the principle on which industry, which so largely dominates men's lives in modern communities, is organized is the principle of autocracy, or, at best, of fundamental class divisions. In this aspect their teaching may be regarded as a precise application
of the Marxian “materialist conception of history” to the criticism of modern parliamentary democracy. If industry is democratically organized, they hold that real democracy in the political sphere will follow almost as a matter of course; but, as long as men, in their daily work, are compelled to submit to external dictation and have no recognized voice in the ordering of their service, these class conditions, they hold, will inevitably reproduce themselves in the political sphere. Guildsmen say that “economic power precedes political power.”
The central object, then, of the Guild Socialists is to establish democracy in the sphere of industry, and thereby to secure that it shall be applied throughout the whole sphere of social organization. In advocating such a change they recognize that their hope of success rests on relating their ideal definitely to actual movements existing within the world of capitalism, but capable of being so transformed as to supplant capitalism and replace it in the organization of industries and services. They have therefore always based their propaganda directly upon the organizations which the manual and professional workers have created for the purpose of protecting their interests and improving their position under the wage system, and they have sought to persuade these organizations to accept the principle of industrial self-government, and to work for the realization of it by endeavouring, in proportion as their power increases, to extend their actual control over capitalist industrialism. Mention has been made above of the transformation which has taken place in the programmes of many trade unions and other working-class bodies, largely under the influence of Guild Socialist ideas. The members of these bodies, from regarding the purpose for which their organizations are built up as limited to the protection of their members' interests under the wage system in face of those by whom they are employed or the securing of useful legislation, are gradually broadening their conception of the function of these organizations so as to include the assumption of direct “control” and responsibility for the organization of industry. Nor is this influence manifest only in the changing programmes of the working-class organizations, but also in their positive policy and action. It was particularly plain in the “shop stewards' movement” in the British engineering and kindred industries, which, during the war, endeavoured to establish in the workshops a wider measure of direct trade-union “control of industry.” It is also manifest in the widening of the range of industrial disputes, and in the putting forward by the unions of claims which involve the recognition of their right to interfere and negotiate on behalf of their members in connexion with questions of “discipline” and “management.” It appears further in demands that foremen and supervisory workers should be members of the trade unions, and even that they should be appointed by, and responsible to, those who have to work under them.
The most remarkable outcome of the guild propaganda, and also the only important practical experiment which the Guild Socialists have so far been able to make, is to be found in England in the Building Guild movement. Towards the end of 1919 a movement arose, largely fostered by the local branch of the National Guilds League, among the building operatives in the Manchester area, for the formation of a guild which would be prepared directly to undertake work, especially on behalf of the public authorities, in the sphere of house-building. A local Building Guild organization, governed by representatives from the local management committees of the various building-trade unions, was set up in the Manchester area, and the movement spread very rapidly throughout the country, so that during the following year something like a hundred local Building Guild committees, linked up in a central organization, were brought into being. These guild organizations proceeded to make tenders to the local authorities for the carrying-out of the housing schemes which were then being brought forward in most parts of the country, and after some difficulty the Ministry of Health was induced to sanction a limited number of contracts on an experimental basis. In March 1921 work was already proceeding on about 20 such contracts.
Some of the difficulties which arose in the starting of the Building Guild movement serve to illustrate very clearly certain of the fundamental principles underlying the Guild Socialist movement. When the Building Guilds first tendered for contracts they were asked by the local authorities and by the Ministry of Health, as a private contractor would have been asked, what “financial guarantees” they were willing and able to give. They replied that they would give no financial guarantee, even if they were in a position to do so, since their intention was not to produce for profit, but to produce for the public absolutely at cost price. There is in the constitution of the Building Guilds not only no provision for capital or for interest or profits, but a definite clause which prohibits the distribution, under any circumstances, of any form of dividend or bonus or profit to the workers. This is one of the features which clearly differentiate the Building Guild movement from the movement for “Coöperative Production” with which it is sometimes confused. In their refusal to give financial guarantees the Building Guilds stressed the fact that they were in a position, as a private contractor was not, to give a “labour guarantee,” i.e. a guarantee that they could and would supply all the labour, including technical and supervising ability, necessary for the execution of the job. Stress has been laid, throughout the guild propaganda, on the idea that the power of the workers is based on their possession of a “monopoly of labour,” and the Building Guild movement itself is based on this monopoly, largely possessed by the trade unions which control the Building Guilds.
In the second place, difficulties arose because the Building Guilds firmly insisted that all workers employed by them must have security against unemployment, and must receive full-time wages irrespective of bad-weather conditions which so often cause an interruption of building work, of sickness, and of the other factors which serve to make the wages of the worker, especially in the building industry, vary so largely from week to week, and thus throw him into a position of permanent insecurity. This condition was accepted in the contracts actually signed by the Building Guilds and endorsed by the Ministry of Health; but considerable trouble subsequently arose over it in consequence of the opposition of the building-trade employers, who regarded it as “preferential treatment.”
This point is very important, and is fundamental to the whole guild theory. In the statement of objects of the National Guilds League quoted above, it will be noticed that the Guild Socialists set out first of all to secure the “Abolition of the Wage System.” A part of what they mean by this is that the conditions under which the workers at present receive wages involve permanent insecurity and are therefore degrading, and such as to place the worker at the mercy of the “governing class in industry.” Guildsmen, therefore, have always made the principle of “continuous pay,” or, as it is sometimes called, “industrial maintenance,” a fundamental part of their propaganda. They have insisted that all those who are willing to do service for the community have a right to continuous pay in return for that willingness to serve, and that the maintenance of the “reserve of labour” is a necessary and legitimate charge upon the various industries, and forms a real part of their costs of production. This principle of “industrial maintenance” has undoubtedly been one of the most favourably received and influential aspects of the Guild Socialist policy.
Guildsmen thus claim the recognition, not only of the principle that the responsibility for industrial administration should be placed in the workers' hands, but also of the principle of economic security for every worker in the widest sense. They recognize fully that this involves changes far more fundamental than any mere alteration of the machinery of industrial administration. They are not simply Guildsmen: they are also Socialists. They are in agreement with other schools of socialist thought in holding that it is necessary to transfer the means of production and distribution and exchange from private hands to some form of communal ownership. They are, however, strongly hostile to the older schools of collectivism or “State” Socialism, which contemplate the nationalization of industry in
a sense which would involve its direct administration, after transference to public ownership, by the governmental organization of the political State. Guildsmen have always laid great stress in their propaganda on the evils of bureaucracy and political control in industry; and their system of direct workers' control is put forward as an alternative to State administration.
This, however, does not mean that they hold that the entire control of the various industries and services ought to pass into the hands of the workers organized as producers. They have always contemplated the exercise of direct producers' control over administration in close conjunction with a control over policy in which the representatives of the organized citizen-consumers would have an effective voice. This is what they mean when they say that self-government in industry will be exercised through guilds “working in conjunction with other democratic functional organizations in the community.”
Guildsmen differ in their conception of the precise changes which are required in order to give effect to this principle. They are united in recognizing that the working-class coöperative movement is destined to play an important part as the representative of the organized domestic consumers in the society to which they look forward. But there is much difference of opinion amongst them concerning the character and role of the State. The majority in the National Guilds League has taken a view concerning the State which is closely similar to that of the Marxians. They regard the State as a form of capitalistic organization—“an Executive Committee for administering the affairs of the whole capitalist class”—and they look forward to its supersession “by forms of organization created by and directly expressing the will of the workers themselves. . . . It (the N.G.L.) holds, however, that the exact form of organization required in any country cannot be determined in advance of the situation which calls it into being.” There is a minority, however, in the Guild Socialist movement which holds that the State is capable of adaptation to the function of acting as the political representative of the community in a state of society in which economic organization is based on the Guild Socialist principle of industrial self-government.
The Guild Socialist theory concerning the precise forms of socialist organization which would replace the present machinery of industry and the capitalist State is still in the making, or rather, to some extent, in the unmaking. Different Guild Socialist writers have put forward different views on this question; and on the whole the recent tendency of the Guild Socialist movement has been towards the abandonment of any attempt to define at all precisely the structure of the future society, and towards a concentration rather upon the principles and policies which are to guide the transition to it, preserving only in general outline a common conception of the character of the future organization. The movement has undoubtedly been influenced, as it has been sharply divided, by events in Russia from 1917 onwards. The National Guilds League in England has affirmed its “solidarity with the Russian Soviet Republic,” but has refused to commit itself as an organization to Communist principles, or to declare for the adoption, in Great Britain, of methods similar to those which the Communists have applied in Russia. It is important to point out that the Guild Socialists and their organization, the National Guilds League, must not be regarded as a party or group at all parallel to other socialist organizations such as the Independent Labour party or the Communist party. Guild Socialists in many cases belong to, and work within, one or other of the socialist parties; and they are held together not so much by a common attitude on the question of socialist political policy, as by a common belief as to the principles which must guide the making of the new society— principles which are compatible with varying views as to the policy which it may be necessary to pursue in the political field. Differences on this question of method have not prevented the guildsmen from working together in their endeavour to promote in the trade-union world, and to a less extent in the coöperative movement, a policy designed to strengthen the demand for workers' control, and to bring about substantial encroachments by the
workers on the capitalist control of industry, even while the capitalist system as a whole remains in being. Mention has been made before of the development of the Building Guild organization. Side by side with this practical object-lesson, guildsmen have worked out policies for adoption in those industries in which it is not possible at present to establish guild organizations in rivalry with the existing capitalist system. They have supported, in the case of the railways, the mines and certain other industries, demands for nationalization, always, however, coupling their support with the demand that nationalization must be accompanied by a large measure of democratic control over administration. At the same time they have pressed, in industry generally, the policy known as “encroaching control.” “Encroaching control” means the attempt by the trade unions, while not at once overthrowing capitalism or dispossessing the present owners of the means of production, to transfer into the hands of the organized workers as many as possible of the functions of control which are at present exercised by employers or their representatives. The two outstanding forms of this propaganda of “encroaching control” are to be found: (a) in the demand put forward by the guildsmen for the election of foremen and supervisors by the rank-and-file workers; and (b) in the policy known as “collective contract.”
(a) Guildsmen are never weary of urging that in place of the present system, under which the foremen and industrial supervisors are appointed by the employers, usually from the ranks of the manual workers, the workers, through their trade unions, should take into their hands the right to appoint their own foremen and supervisors. This demand has not at present been conceded save in an insignificant number of instances; but the trade unions have taken certain steps towards it by securing, in numerous instances, the dismissal of foremen to whom their members have taken objection. The carrying-through of this policy of democratic election of foremen is closely bound up with the policy of “collective contract.”
(b) By “collective contract” is meant a scheme capable of assuming a number of different forms, under which the whole of the workers in a particular shop, factory or department would make with their employer a single agreement as to their terms of service, the amount and character of their output, and the payment for it. Instead of the present system, under which the employer engages and pays each worker individually, and appoints his own representatives to exercise discipline in the workshop, the trade unions themselves, under this system, would make a contract with the employer to supply the necessary labour, including workshop supervision, and to carry out the work required, and would thus control engagements and dismissals as well as workshop discipline. The employer, instead of paying each worker individually, would pay to the union, or to the works committee on its behalf, a lump sum, which the workers would then distribute amongst themselves in such a way as they might agree upon. By this arrangement, it is contended, the employer would be directly excluded from a certain sphere in which he now exercises control. The workers would thus not only get a valuable lesson and experience in the work of controlling industry, but would also greatly strengthen their position for a subsequent further assumption of power, which 'would involve the winning of industrial control over a wider area, including commercial as well as purely productive operations. This system, too, has not yet been adopted anywhere in full; but certain approximations to it have been made.
The guildsmen stress, in the whole of their propaganda, the need for an appeal to a new motive in industry if men are to be persuaded to put out their best efforts, and to do their best work in the service of the community. They claim that in the past, since the coming of large-scale industry, production has been secured mainly by the operation of two motives fear (of unemployment and starvation) and greed (for higher remuneration secured, e.g. by “payment by results”). They contend that these two motives are showing themselves more and more inadequate to secure the continuance of production, and that this is shown both by the increasing frequency and severity
of industrial disputes, and by the diminished willingness on the part of the workers to do their best. They maintain that a different spirit can be made to prevail in industry only if two conditions are satisfied. The first of these conditions is that the worker must have a sense that, in putting his best into his work, he is serving, not the private interest of any individual, but the whole community, and that his work is being directed to that end which will most conduce to the common benefit; the second condition is that the responsibility for doing his best must be placed upon the worker himself, and that he must be given freedom, in the form of self-government, in the organization of his work. These two ideas are often put together in the phrase “free communal service,” which is regarded by guildsmen as the condition of the creation of reasonable industrial order. It is recognized that such an order would make higher demands upon the will and good-will of the mass of the people than the capitalist system; but guildsmen contend that, if the right appeal is made and the above conditions satisfied, the workers will rise to the occasion and will be prepared to do their best in the service of the public, because they will feel that they “count,” and that the responsibility for the good conduct of industry rests directly upon them. Guild Socialists always insist that the power which goes with responsibility must be diffused to the widest possible extent among the whole mass of the people, and that this is the necessary condition of democratic efficiency and healthy social organization.
References.— There is a large and growing literature dealing with Guild Socialism. See National Guilds, by S. G. Hobson; Guild Socialism Re-stated, by G. D. H. Cole; The Meaning of National Guilds, by M. B. Reckitt and C. E. Bechhofer; Old Worlds for New, by A. J. Penty; Self-Government in Industry, by G. D. H. Cole; other works by Hobson, Cole and Penty; and the various publications of the National Guilds League (39 Cursitor St., London, E. C. 4.). For hostile criticism see Guild Socialism, by G. C. Field; Our Social Heritage, by Graham Wallas; and The Case for Capitalism, by Hartley Withers. For the social theory of Guild Socialism see Social Theory, by G. D. H. Cole; Authority, Liberty and Function, by Ramiro de Maeztu; The Sickness of an Acquisitive Society, by R. H. Tawney; and Roads to Freedom, by Bertrand Russell. For its industrial policy see Chaos and Order in Industry, by G. D. H. Cole; The Nationalization of the Mines, by Frank Hodges, and the evidence volumes of the Coal Industry Commission, 1919 (evidence of Cole, Straker, Slesser, and others). The National Guilds League publishes a monthly journal, The Guildsman, in which questions of Guild Socialist and trade-union policy are regularly dealt with, and news given of the movement in various countries.
(G. D. H. C.)