Will the internal conflicts that seem to beset most societies weaken and perhaps sever the tics that keep them intact ?
The man or woman who takes a pessimistic view might well start hoarding canned food and searching the nearest mountains for a dry cave. The optimist may care to read this booklet.
In any society, individuals and social groups are bound to conflict over goals, priorities and their share of available resources. But they can still live tolerably well together if they accept certain minimal rules and principles which inescapably govern how their society functions.
If 26 people decide to have a game and divide into two teams, it might not matter if the sides are uneven. But they will not get far if eleven determine to play by the rules of Association Football and fifteen by those of Rugby Union. They cannot even start without reaching some consensus on the shape of the ball. Nor will the mere appointment of a strong referee help much. Without some common agreement on the rules that he is to enforce, he will rapidly become the subject of their combined contempt.
By the same token, there are rules and principles which are essential to the functioning of any community. This booklet attempts to put the more important of these in simple terms intelligible to any citizen who wants to go on playing the game that we call `civilised society'. (Perhaps even the pessimist may care to glance at it before he sets off for the mountains.)
The contents of this booklet have been formulated from the writings of sociologists and economists of our day and from discussions with people from many walks of life. A great debt is owed to them.
OPUS, an Organisation for Promoting the Understanding of Society
Decision Making and Social Conflict
Never before in the history of man has there been so much
opportunity and demand to take part in the process of decision-making—
by debate, by representation or even by threat of sanctions.
Modern mass media communications create unprecedented public interest in many social questions. Much of this results in pressures for or against change. These pressures are unlikely to be productive unless they be matched by public understanding of how society—any society—could work. Without this essential knowledge it is difficult to see things in their proper perspective. For example, Government measures to deal with inflation are controversial because they hurt some people more than others.
What is essential to improve public understanding ? A group of social scientists associated with the Tavistock Institute of Human Relations has, with the support of many experienced observers from different walks of life, extracted from numerous studies of social behaviour a set of eleven laws and principles which are fundamental to the study of conflict. They have expressed these in plain language in order to make them more widely understood. These laws and principles are independent of value judgements. They are based on logic and general experience rather than just on opinions and therefore should be acceptable as a basis for decisions by all manner of people irrespective of age and of political or religious beliefs.
While these principles are not intended to replace the detailed knowledge required by many decision-takers, they are nevertheless essential to the understanding of society. They are of varying degrees of rigidity. Some are laws of nature or simply arithmetic; these are applicable to every society and no governing authority can override them. Others are social principles or rules created by man which can be altered.
The Tavistock study was therefore designed to establish in simple terms the elements of how society works and to discover whether forms of communication can be devised to achieve wider public understanding.
The problems of communication are considerable. As a society we are tired of exhortation. Facts are essential but reasons are sometimes more important than facts. On the other hand, it is known that acceptance of a statement is governed more by the position of the person who makes it and by the reassurance it brings to the recipient than by the logic on which the statement is based. This attracts the making and acceptance of statements which, either by inference or by omission, arc incompatible with one or more of the basic principles.
What are these laws and principles ? They fall into several categories, including economics, human behaviour and choice, methods of sharing, ownership and power and distribution of wealth.
Consider the economic laws first. Man spends most of his time
either using and consuming goods and services or producing them.
The function of industry is to organise his working time and skill,
together with raw materials and the necessary tools and services, to
enable him to produce what ultimately he and his fellows will consume.
In this connection there is one very basic law of economics:
Principle 1`GOODS AND SERVICES CANNOT BE USED OR CONSUMED UNLESS THEY HAVE BEEN PRODUCED AND MADE AVAILABLE'
This is so self-evident that it is liable to be brushed aside. Its consequences are not so obvious and indeed are sometimes dismissed or at least resented. Nevertheless, this is a natural law as valid as the physicists' law that `man can neither create nor destroy energy and matter.'
This leads naturally to Principle 2
Principle 2`EXCEPT IN TIMES OF SURPLUS, AN INCREASE IN ANY ONE PERSON'S OR GROUP'S CONSUMPTION, IF NOT MATCHED BY INCREASED PRODUCTION, REDUCES THE GOODS AND SERVICES AVAILABLE FOR CONSUMPTION BY ALL OTHER PEOPLE IN THE SAME DISTRIBUTION AREA BY THE SAME TOTAL AMOUNT'
This, of course, is simply arithmetic when applied to each and every commodity. It is especially relevant to those communities that place a value on the growth of, or at least on the retention of, their material standard of living.
By this standard we mean the average consumption by the people in the community of the goods and services that they want; it is the total production arising from the efforts of the people and their machines, the so-called `national cake', divided by the total number of people. Sharing has to be brought into the standard but this is dealt with later
Principles I and 2 state that such a growth can only be achieved by increasing the rate of production of the individual workers and their machines—which we call `productivity'—or by increasing the percentage of the population that is working. Clearly an unemployed person is not adding to the national cake.
The second principle is a severe restraining law and one which can only be be avoided by drawing on stocks so long as they exist. It applies in all countries whatever the political system. It is not always accepted, because people resent restraints and because `common sense' to some people appears to lead to the opposite conclusion. How often have we heard people say: `If my money income goes up my standard of living goes up. If any of my neighbours' incomes go up the same happens to them. So I believe income governs the standard of living, not productivity.' For simplicity the word `goods' is used here to include `tools' (that is, investment goods such as buildings and machinery) as well as consumables such as food. Man as an individual or as part of a group has a choice as to what proportion of his total effort and resources he invests in producing new and better tools.
In this respect Principle 3 applies:
Principle 3`OF THE TOTAL EFFORT AND RESOURCES AVAILABLE, A HIGHER PROPORTION CAN BE DEVOTED TO INVESTMENT ONLY IF A LOWER PROPORTION IS DEVOTED TO CONSUMPTION'
People differ widely in what they think is the optimum balance between the requirements of the future and those of the present. Their judgements can only be personal but science can help to clarify their objectives so that the range of views is narrowed.
It has not been necessary so far to introduce the concept of money except to correct one of the misconceptions associated with it. Money is not in itself `goods or services' but it is a long and well-established device for putting values on goods and services so that they can be more easily exchanged.
Money is also very important as a mechanism of saving. Any individual can reduce or postpone his consumption and accumulate his unused claims on the community (his money) in the form of savings. He can allow someone else to hire or borrow these claims, usually on payment of a hiring charge (interest or dividends)
For example, pension rights are largely derived from savings.
With the concept of money, there is a fourth Principle:
Principle 4`PRICES CANNOT BE HELD BELOW COSTS'
This assumes that costs include not only those of people, materials, taxes, etc. but also the hiring of savings and provision for the future. This is a social principle and it means that attempts to hold prices below costs normally lead to bankruptcy.
A subsidy can lower costs to purchasers of particular goods or services but this merely transfers this part of the cost and price over to the taxpayer or to other people. The make-up of costs for the country as a whole is regularly analysed by the Central Statistical Office. This analysis shows that incomes from employment represent well over half the costs, followed by imports, which represent about one-fifth. A rise of, say, 10% in incomes will directly increase costs by two and a half times as much as would a 10% rise in costs of imports.
These simple facts of arithmetic are frequently contradicted directly or indirectly and alternatives are expressed and sometimes accepted. For example, many people believe that a rise in incomes is caused by a rise in prices. Action based on this belief completes the `vicious spiral' of inflation. Of the two links in this spiral, the first is the unavoidable Principle 4, whereas the second is simply an expression of man's expectations and ambitions. A clear realisation of the extent to which these ambitions are in conflict with the interests of others, and with future national interests, is a first essential step towards the co-operation necessary if inflation is to be curbed without abandonment of important policies such as full employment and free collective bargaining. There are, of course, other important factors which influence inflation, such as money supply and taxation.
Due to improved productivity and technological advance, average earnings in the UK have in most years since the war increased faster than prices. This means an increase in the material standard of living. However, this is now being sustained only by heavy borrowing from overseas with all the inevitable problems that this brings.
These four principles apply with the force of a natural law to the economics of any community. But there are no natural laws governing the economic behaviour of individuals. Accordingly, each community lays down legal laws and social principles which can vary widely but only within the limits set by the natural laws. A society usually agrees that some people, for example the young, the old, and the sick, may consume more (in value terms) than they produce, but overall these must be balanced by others consuming less.
Now consider human behaviour and choice. The variability of man is
enormous; no two individuals have the same assortment of genes (except
identical twins) nor the same accumulation of experience. Accordingly, it
is more difficult to formulate simple principles of human behaviour that
have a universal validity. Nevertheless, the following three principles
are statements of general experience. They apply in so far as rationality
and logic, rather than emotion, form the basis for individual decisions.
Principle 5`MAN HAS THE CAPACITY TO TAKE IN INFORMATION, ASSESS THIS IN RELATION TO HIS PREVIOUS LEARNING AND CHOOSE A LINE OF ACTION IN THE LIGHT OF HIS RECOGNITION OF THE RELATED RESTRAINTS AND PRESSURES. HIS CHOICE USUALLY INDICATES WHAT HE THINKS WILL BRING AN OUTCOME MOST ADVANTAGEOUS TO HIMSELF'
Individuals vary widely in the values they attach to what they perceive and to the possible outcomes. Indeed they sometimes act to give more advantage to others than to themselves, Nevertheless, a large part of man's motivation and behaviour is associated with the influence he may attain over those outcomes which appear important to him.
Principle 5 relates mainly to choice, but it also introduces another key word `restraints' (including pressures). The exercise of one person's freedom of choice very commonly leads to a restraint on others. A specific example is Principle 2.
Human behaviour also responds to external social pressures:
Principle 6`MEMBERSHIP OF A GROUP IS BOTH A MEANS THROUGH WHICH THE INDIVIDUAL ACHIEVES HIS OBJECTIVES AND ALSO A CONSTRAINT ON HIS CHOICES, IN THAT HE EXPERIENCES PRESSURES TOWARDS CONFORMITY TO GROUP STANDARDS AND TOWARDS CO-OPERATION WITH HIS FELLOWS'
Similarly, an organisation may pursue multiple goals. It experiences pressures from different parts of its environment, with the result that the behaviour of one sector may be inconsistent with that of another. Again, education can help to identify inconsistencies, so that they may be examined and perhaps eliminated.
This situation is developed further in Principle 7.
Principle 7`INDIVIDUALS, GROUPS AND ORGANISATIONS TEND TO COPE WITH CONFLICT BY DENYING RESPONSIBILITY FOR THEIR ACTIONS AND PASSING ON THE RESPONSIBILITY TO OTHERS'
It follows that to try to understand conflict, it is necessary not only to consider the more obvious issues but also to explore underlying factors, which may lie within and between each party to the conflict. For example, it is a general experience that a group unites in the face of an enemy; if a suitable enemy does not exist, the group may need to invent one.
Sharing the Cake
We have already seen under Principle 2 that the material standard
of living of a group is defined as the average consumption of goods and
services. This is obviously insufficient and we need to consider how the
goods and services and the jobs which produce these can be shared out
between the members of the group. Furthermore, this standard of living
depends upon the extent to which the goods and services in quality and
quantity match the needs and desires of the consumers, both currently
and in the future. Experience has shown that in any distribution system
it is necessary to take account of Principle 8.
Principle 8`ALL KNOWN SYSTEMS OF DISTRIBUTION OF GOODS AND SERVICES AND OF JOBS ARE COMPOSED OF TWO BASIC SYSTEMS'
(a) The market choice system. (distribution by barter or by the price mechanism: this gives a measure of choice to individuals or production units within the limits of their earnings or costs)
(b) The allocation system (here choice is largely made by decisions of an overriding authority)
Each country can and does decide the balance between the systems, which system is applied to which commodity, and the restraints associated with individual choices.
The major difference between the two systems lies in where and how decisions are made. The first of these, 8(a), operates largely by decisions of each individual as to what he produces and what he consumes. The restraints are put on by what the market (other people) will pay or will charge in respect to alternative actions. However, governments through taxation and the use of subsidies, make or influence decisions on behalf of all individuals covering a substantial part (in the UK over one-third) of total incomes.
The second of these systems, 8(b), operates more by decisions of the group or of its leaders, co-ordinated by planning. Some group decisions, such as those related to differentials and methods of payment, may be influenced by rules or traditions that have grown up over time.
Principle 8 is not a natural law but it is a statement of general experience. Despite numerous attempts no one has yet devised an acceptable and tested system which is other than some combination of (a) and (b). Meanwhile the Principle remains: a group cannot, for example, depart from a market choice system without going more towards an allocation system, and vice versa.
To meet the requirements of Principles I and 2 countries adopting the market choice system generally introduce social rules and money mechanisms to link consumption by individuals to their production. We call that payment by results. For countries adopting the allocation system this link automatically comes out of the planning. At first sight system 8 (a) might appear to be the more natural because it involves the basic Principle 5. If not interfered with it tends to lead to a balance between supply and demand, and thus to a high efficiency in this respect. On the other hand, the actions of large institutions, such as the Bank of England or a powerful trade union, can influence the working of this system in the supply and cost of money and of human effort respectively. Governments as big purchasers can also affect the working of the system and large companies can influence social behaviour to their own advantage. The system has its defects particularly when monopolies are able to corner markets or when the supply of labour substantially exceeds the demand. Without modifications and safeguards, particularly to produce a reasonable distribution of income, it is hardly acceptable today.
One could equally find defects in the allocation system. Without the test of choice it is difficult to reach agreement as to the values that are to form the basis of allocation. It is also difficult to assemble the information necessary for effective planning. To many people the limitation of choice is itself a defect. Indeed, in most countries operating this system (but not in kibbutzim), it has been found necessary to restrain the freedom to opt out of or emigrate from the system.
Another important principle follows from Principle I and from the
fact that the world is composed of more or less autonomous nations and
no international leadership (as yet) exists that can impose allocations
as in sub-principle 8(b). International trade is thus mainly influenced
by market forces. In addition, it is controlled by Principle 9:
Principle 9`FOR ANY ONE COUNTRY, TOTAL OUTWARD PAYMENTS (SUCH AS FOR IMPORTS, CAPITAL INVESTMENT AND LENDING ABROAD) ALWAYS BALANCE INWARD PAYMENTS (FOR EXPORTS AND FOR BORROWING AND GIFTS)'
The validity of this principle has been seen in the UK in post-war years, yet many commentators express resentment when any country finds itself forced to take unpopular action because of it.
For example, when a British industrialist demands protection from imports, he is ignoring the fact that other countries can only pay for their imports from UK if they earn the required UK currency. In this area many decisions are outside our control—for example, the policy dictated by the OPEC countries has had severe repercussions on our economy, far beyond the cost of producing oil.
Ownership and Power
The subject of ownership of wealth has until recently played only a
small part in conventional economics but it always has played a large
part in law and politics. The term could usefully be used in a sense
which equates it to ability or power to make effective decisions or to
exercise choice. In this respect, however, there is a wide spread of
power from very little to very substantial. This leads to Principle 10:
Principle 10`MAN FEELS A STRONG NEED TO CONTROL THOSE EVENTS WHICH HAVE MOST EFFECT UPON HIS OWN WELL-BEING AND SOCIETIES USUALLY GIVE HIM SOME DEGREE OF SUCH POWER THROUGH OWNERSHIP'
The actual rules of ownership vary widely. In many countries there is a substantial concentration of ownership in the hands of the few. There is also a wide variation in the use people make of their wealth. Society generally is currently re-examining these rules to see if they can lead to `better fairness.' The subject has not attracted much interest by analysts except in the political arena; it is included in this study because of the large part it plays in conflict. Much conflict is between the `haves' and `have nots.'
The origins of ownership by individuals include:
Some of these lead to special kinds of wealth.
Distribution of Wealth
Ownership has one marked characteristic in that it has a strong
`positive feedback'. This can be expressed by Principle 11:
Principle 11`THE MORE AN INDIVIDUAL HAS OF MATERIAL THINGS OR POWER THE EASIER IT IS FOR HIM TO GAIN THE NEXT INCREMENT OF HAVING'
This is why inequalities in wealth are often much greater than the range of individual abilities and opportunities. Most market choice societies now reduce this feedback by graded tax systems and death duties, by welfare allowances and by the `one man— one vote' system. Such countermeasures can reduce the motivation of some individuals to create wealth. This principle also applies to the economic strength of groups such as countries.
The Next Step
If the reader compares these laws and principles with his own
experiences and with his own problems and aspirations, he may find some
inconsistencies or omissions. Such inconsistencies are usually due to
a difference in the understanding of words. Omissions, particularly of
time-lags and of other qualifications, have been necessary to keep this
booklet short in order to reach the largest possible readership.
These principles have been found to be widely acceptable. But will improved understanding lead to less wasteful conflict and perhaps less violence ? The belief of many is that it will. For example exposure of selfish actions which hurt others (Principles 2 and 5) normally puts a restraint on such actions. The extent to which inflation can be curbed without abandonment of full employment and of free collective bargaining depends on co-operation and this in turn depends on understanding. Principle 7 highlights a weakness in man which, if not recognised, leads to much conflict. People have been led to have expectations that are realizable only by hurting others. There is a place for conflict, and in particular for debate, in every dynamic society but co-operation is essential if common objectives are to be attained.
The next step therefore has the objective of trying to develop the thinking citizen who can distinguish reality from fiction and who can exercise authority in his various roles with wisdom and integrity in the light of a fuller understanding of society. All responsible people, including politicians, educationists, managers, trade unionists and the media are urged to take part in communicating these fundamental principles to the public at large. They are also urged to add to these or build on them while retaining the objectivity of science. A better understanding will reduce conflict and release additional sources of energy to contribute to a more constructive and happier society.
OPUS is an independent organisation for the promotion
of a wider understanding of the working of society. It has
been established with the encouragement of
The Tavistock Institute and The Industrial Society.|