The Workers' Veto: Democracy and Capital in Postcolonial India

The analogy between the firm and the state has constituted a long-standing debate in political theory. Traditionally, the argument goes, the firm’s structural similarity to a state provides an argument for democratising the firm. Commentators draw on such similarity to argue that relations between workers and the firm should be governed by principles similar to those that underpin the relations between a citizenry and the state (Dahl 1985; González-Ricoy 2014; Landemore & Ferreras 2016). And the firm-state analogy, therefore, generates an argument for workplace democracy. In postcolonial India, however, this analogy took on an inverted form. The writing of the constitution for India’s new republic inaugurated a regime of universal adult suffrage. Although such enfranchisement received little public contestation, it attracted its share of doubters. Could an electorate steeped in poverty, largely illiterate, truly offer stewardship for a new state, with all the challenges of postcolonial transition? Could the masses, seemingly unable to rise above differences of religion, caste, and language, perform the role of citizens of a modern democratic state? The violent partition of India and Pakistan and the bloodshed that followed meant that these questions held still greater stakes. This anxiety about India’s populace extended to scepticism about workers’ capacity for meaningful participation in firm governance. Immediately after independence, India’s new leaders drafted not just the constitution for the new state, but also the blueprint for independent India’s corporate governance regime. There were potential paths this charter could have taken—West Germany’s model of co-determination and Yugoslavian self-determination had arrived on the landscape as possible blueprints for industrial life. Yet, India’s leadership emphasised the demands of order and efficient production over experiments in democratic firm governance. Just like the state required guardrails against the country’s as-yet backward populace, the argument went, Indian industry required careful steering to maintain stability and productivity. Though dominant, this vision of industrial governance was not uncontested. From the early years of the new republic, socialist and communist leaders questioned the wedge that separated democratisation of the state from a participatory firm. If the new state could entrust its citizens, despite all misgivings, with responsibility for governance, why did this faith not extend to industrial life, they asked. This moment of dissent, largely sidelined in the story of Indian democracy, provides an important vantage point for thinking about the intersection of corporate power and democratic politics in the present. Revisiting these debates allows us, I argue, to rethink a key debate in political theory—the longstanding dispute over how political parties are to be funded. In this paper, I defend a framework where corporate donations require workers’ consent—a move that resists, both, the unchecked authority of capital over democratic politics, but also the presumption that the reach of democratisation must end at the factory’s gates. To ground this argument, I excavate a largely forgotten history of workplace democracy in India and its intersection with debates over corporate influence in political life.