It is a little ironic that the fight for collective bargaining today is
taking place in Madison, Wisconsin where John R. Commons taught for
years. Street  (1966) observes that Ayres agreed with Veblen on the
negative effect of ceremonial activities and institutions, calling them
a “persistent drag.” But a very different view of social institutions
emerges from the work of John R. Commons, who saw collective action
through the democratic process as reshaping institutions to improve
society and individual freedom. 

Commons was the source of many landmark social innovations
(institutions) that helped to soften the clash of social interests in a
modern capitalist economy and improve the standard of living of the
average worker and citizen. Variations of his workers compensation
program, devised for Wisconsin, were rapidly adopted by other states
(Street 1973) and the unemployment insurance and pensions systems became
models for the New Deal.  This was all based on his view that
“collective action within a responsive democratic framework of
legislation and judicial interpretation can transform existing legal
arrangements into more effective instruments to promote development.”
(Street 1974).

As some of you know I’m starting to work on a book that focuses on Post
Keynesian economics and Social Justice. One issue I’m exploring is
whether there are conditions needed for true freedom and what are they.
Let us take a case where you have a worker in Bahrain where his
situation is to work long hours in a terrible and unsafe environment or
starve. Some would say that he has liberty and freedom since he has a
“choice.” No one is coercing him to work at this place.  But freedom
should mean much more than just having the freedom to make a choice, but
having “meaningful” choices in one’s life that will truly make one’s
life better off and happier. Since the choice the worker has is not a
“meaningful” choice, similar to “take your life or your money” then
in many ways he is a “victim” and his choice and freedom is being
coerced. 

Liberty, then, is not just dependent on being able to make choices, but
something much more, which is being able to make meaningful choices in
one’s life. In this case the choice of working or starving is not being
imposed by a particular individual, but by the type of social
arrangements that exist. If we change those social arrangements which
might include the right to bargain, provide unemployment compensation
where being unemployed is not equal to starving, or educational
opportunities to learn new skills for other job opportunities, then
these change in social arrangements has significantly increase the
liberty and freedom of this individual in a meaningful way. So
following, in many ways, the ideas of Commons the type of social
innovations that we put into place can dramatically increase our
individual freedom and lead to less conflict and more harmony in society
which will increase overall social welfare. Economic development has
both quantitative and qualitative changes that can increase liberty or
restrict it. 

Ric Holt
Southern Oregon University