Ebook: Free Enterprise, Fair Employment

Reviewed in the United States by Barry Linetsky ?? on April 17, 2006
Jaques On How To Shackle Free Enterprise

Despite the title of this book, in Free Enterprise, Fair Employment, Jaques advocates free enterprise without free markets. He is opposed to the voluntary negotiation of wages between employees and employers, and advocates that governments should set all wage rates according to his stratification theory. This, of course, requires the government to assess each person so that they are not being paid more than the government deems they are entitled to based on their cognitive capabilities.

Free Enterprise, Fair Employment is now 25 years old, and it hasn't stood the test of time well. Jaques apparently saw no contradiction between extensive government control of wages, income and the mechanism of free markets on the one hand, and the ability of business to function effectively on the other. He endorses a 'scientific socialist' and social engineering approach to society consistent with his academic training as a sociologist. He advocates paternalistic government limits to freedom of contract between consenting adults, including employers and employees, claiming that all wage agreements are "coercive" and implying that wage negotiations without government intervention are unethical. Philosophically, he advocates that citizens have no rights other than those granted or permitted by governments. He must deny any notion of man's fundamental right to life, liberty, and property.

In publishing this treatise, it appears that Jaques was seeking a coercive government intervention to implement his theories on a nation-wide scale, asserting that only his solution could save democracy and civilization from the ravishes of inflation and high unemployment. What he failed to understand is that both high inflation (around 20% at the time) and high unemployment were the inevitable result of unhindered government intervention and Keynesian economics, the very thing he was advocating more of.

Jaques may have fared better in deriving a reasonable solution to the social problems of the day had he placed more credence in the works of F.A. Hayek or Peter Drucker, rather than Keynes and egalitarian ethicist John Rawls. Margaret Thatcher did the exact opposite of what Jaques advocates, and solved the problem in England through less government and more liberty, thereby refuting Jaques' ideology.

In his last - and very outstanding - book prior to his death, Social Power and the CEO, Jaques cites Hayek in the bibliography, so perhaps he had a change of thinking about the relationship between government intervention and personal liberty. By 2002 he had ceased writing about the need for more government intervention and wrote more generally about the need for free markets and the responsibility of CEOs to create a better, more just world by building humane corporate hierarchies and requisite organizations capable of supporting the full potential of each and every employee.

I would like to think that at the end of his life, Jaques would have repudiated the ideological position he takes in this unimpressive and confused effort.

Don't let this review put you off of Elliott Jaques. His book Executive Leadership, written with Stephen Clement, is one of the best and most important business book I have ever read. This is further proof that Jaques should have stuck to his area of expertise, which surely isn't economics and political philosophy.