Corporatism was originally a 19th-century doctrine which arose in reaction to the competition and class conflict of capitalist society. In opposition to the trend towards both mass suffrage and independent trade unionism, it promoted a form of functional representation - everyone would be organized into vocational or industrial associations integrated with the state through representation and administration.
The contention was that if these groups (especially capital and labour) could be imbued with a sense of mutual rights and obligations, such as presumably united the medieval estates, a stable order based on "organic unity" could be established. Although the notion of industrial parliaments was commonly raised in liberal democracies after WWI, the only states that explicitly adopted a corporative form of representation were the fascist regimes of Italy, Germany, Spain, Portugal, Vichy France and various South American dictatorships.
In all these cases, corporatist structures were primarily a decorative façade for authoritarian rule, state repression of independent trade unionism being the main motive and consequence. Given this experience, corporatist ideology has not been popular in Western liberal democratic societies, but by the 1970s it became increasingly common for social scientists to discern that certain political arrangements had developed within these frameworks, which in operative premise and institutional form bore some resemblance to the functional-representation notions of corporatism.
This was particularly true in many West European countries, where the central trade-union and business federations had joined government representatives in national economic and incomes policy planning. These arrangements helped sustain the Keynesian welfare state, in which governments sought to stem inflationary tendencies in the economy and encourage productivity. Central to all such arrangements was the effort to persuade unions to accept national wage-restraint policies in exchange for representation in economic decision making.
Corporatism temporarily came to be seen by many social scientists as either a new economic system, successor to capitalism, where the state controls and directs a highly concentrated but still privately owned economy; or a new form of state, where the important representation, decision making and administration take place not in the parties, parliaments and ministerial bureaucracies but in the tripartite structures where business, labour and governments are joined; or a new form of interest-group politics, where instead of the competitive, lobbying activities of many pressure groups, there is a monopoly of access to the state by one group from each sector of society, with the state exercising reciprocal influence over the groups.
While each of these scenarios captured some aspects of modern corporatist developments, they were all too expansive and grandiose. Corporatist structures may have supplemented parliamentary forms in certain countries, but they hardly became the centre of the liberal democratic state. They were confined primarily to the relations among big business, organized labour and government. Above all, corporatist arrangements do not challenge capitalism as the economic system of these societies.
Important key investment decisions, although influenced by the state partly through corporatist structures, remained with private corporations. Indeed, far from emerging as the new dominant institutions, corporatist structures displayed an inherent instability, reflecting the asymmetry of the relative power of capital and labour and the tendency of trade unions to withdraw their co-operation in wage-restraint policies when members insist that their leaders represent their demands rather than act as junior partners in managing the modern capitalist economy. In turn, capitalist classes have shown themselves less and less interested, for their part, in maintaining such partnerships, and this has led to corporatist arrangements to be increasingly abandoned along with the Keynesian welfare state through the last two decades of the 20th century.
Corporatist Developments in Canada
Corporatist ideologies were popular in Canada in the first half of this century. The Québec Catholic Church was heavily influenced by corporatist doctrine and this had a direct impact on French-Canadian trade unionism, through the Confédération des travailleurs catholiques du Canada, and on political parties such as the UNION NATIONALE. Corporatist influences were also at work in the doctrine of "group government" espoused by the Prairie farmers' parties between the wars.
Mackenzie KING explicitly espoused a corporatist ideology in his book Industry and Humanity (1918). However, political and economic conditions have not been propitious for corporatist developments; both the decentralized nature of the movement and the absence of a governing social-democratic party at the national level have been critical in precluding them.
Additionally, the heavy pro-business bias of the Canadian state and the difficulty of planning an economy as open as Canada's to FOREIGN INVESTMENT led the state, even in the post-1945 era, to rely much more on unemployment and on legislative restriction of the right to strike than on the incorporation of union leaders into national decision making. Various attempts, ranging from the establishment of the Economic Council of Canada to the discussions with business and labour around prices and incomes policy in 1969-70 and 1975-78, were made in the 1960s and 1970s to create national corporatist structures, but these developments either remained exceedingly minor or came to nothing because business and unions refused to engage in the necessary compromises to institutionalize corporatism in Canada.
In recent decades federal and provincial governments, while sometimes still calling for voluntary co-operation between capital and labour in "social contracts," have tended to impose statutory wage controls and restrictions on the right to strike, especially on public-sector workers, rather than creating a groundwork for integrating the union leadership into economic decision-making structures. While particular examples of corporatism still exist in federal and provincial labour-relations boards, in various government-sponsored "quality of working life" programs and in occasional task forces on economic development and training, they are modest and marginal to the main agenda of political and economic life. In this respect, the demise of corporatism in European societies which often provided a model for those who sought corporatist solutions to Canadian problems seems instead to have followed the Canadian example.