Dignity, Status, and Function: Pay Attention to the New Concerns of Knowledge Workers

Karen Linkletter, Ph.D.

PUBLISHED:

December 15, 2022

The recently averted railroad worker strike reminded me of an important event in history that most people today are probably unaware of. In 1877, rail workers across the United States went on strike, creating what historians now refer to as the Great Railroad Strike. When historians think an event was significant, causing some kind of cultural, economic, social or other upheaval, they designate it with the term “Great” (the Great Depression, the Great Awakening, the Great Recession).


Peter Drucker looked at events of his time through the lens of a social ecologist: someone looking for meaningful change that has already impacted or would impact society in the long run. This change may be in the form of demographic trends, shifting attitudes, or significant events. In hindsight, we know that the 1877 strike was significant although, at the time, it appeared to be a short-lived, albeit violent, worker uprising.  The Great Railroad Strike showed the changing nature of class identity, and what can happen when people feel a loss of dignity, status and function in society. While certainly not a “great” event, the averted 2022 strike is perhaps another event that points to changing attitudes about work and the continued importance of dignity, status and function. I think it presents us with a moment to consider the nature of work in our post-pandemic environment, particularly as many organizations grapple with challenges related to finding and retaining qualified workers – especially knowledge workers.


Before we get to the details of the 2022 railroad strike that didn’t happen, I’ll give a brief summary of the Great Railroad Strike. Economic conditions in 1877 were grim. The United States suffered an economic “panic” in 1873, when the failure of a major investment firm triggered a loss of confidence in the financial markets. The country plunged into a depression, and firms began cutting jobs and wages, raising unemployment and further dampening the economy. The railroads, which were the primary means of transporting goods across the United States, had been a growth industry until the Panic of 1873, and employed large numbers of workers. In May of 1877, the Pennsylvania Railroad, the nation’s largest railroad, cut wages by ten percent, and then cut them by another ten percent the following month. Other railroad companies did the same thing, and also cut the work week down to a couple of days. In July, the Pennsylvania Railroad doubled the size of its eastbound trains with no increase in staff to manage the additional workload. In that month, workers began to rebel, taking control of train switches and preventing cars from moving. Violent strikes began to erupt in cities across the country; Maryland, West Virginia and Pennsylvania called up their state militias to respond to the violence. In some cities, militia members sympathized with the strikers, and joined in. President Rutherford B. Hayes called in federal troops, and in Pittsburgh, these troops fired into crowds of people, killing more than 20 civilians. By the end of July, the strike had subsided, leaving 100 people dead across the country and over a thousand arrested.

The workers received none of their demands (better pay, restored hours), and labor unrest continued in the industry well through the late 1800s. So why was this such a momentous event?


·     Public support: Mark Twain published The Gilded Age: A Tale of Today in 1873. In this novel, he satirizes the wealth inequality that was a feature of American society in the late nineteenth century. The greed and political corruption of this era is well documented; as working-class Americans became increasingly aware of the growing class divisions in society, they sympathized with the railroad strikers. This public opinion fueled an eventual call for labor reform.

·     Multi-industry support: This was the first general strike in American history, where workers from other industries supported the rail workers. The Great Railroad Strike touched a nerve in the growing working class, who felt devalued, increasingly marginalized, and exploited by a wealthy ruling class.

·     Catalyst for unionization: At the time, there were few organized labor unions; organized labor consisted of local brotherhoods of primarily skilled workers. The Great Railroad Strike galvanized workers to organize into more effective unions, such as the American Federation of Labor, to attempt to ameliorate their work conditions, hours, and wages.

·     Power: The Great Railroad Strike showed the power of human action. Without any organization and structure, rail workers were able to cripple the transportation network of the United States. Meat rotted on railroad cars, mail was not delivered – an entire national system of order was brought to a halt by a relatively small group of people wielding enormous power.

 

There are some parallels between the Great Railroad Strike and the averted 2022 railroad strike, and also some remarkable differences. First, the parallels.


·     Essential workers: People in the 1800s paid a LOT of attention to what happened with railroads, because they understood how goods moved through the country, and they felt the impact. The COVID 19 pandemic highlighted the importance of “essential workers,” including those employed in transportation. As supply chain constraints led to shortages of all kinds of goods, from microchips to toys to food items, most Americans, probably for the first time, were unable to purchase some product for lack of supply. During the pandemic, essential workers in health care and grocery stores were heralded as “heroes.” Workers in rail transport received little attention even though that industry experienced enormous upheaval. However, the threat of a strike in 2022 just before the holidays put the railroad industry in the spotlight, showing how, in spite of their small numbers, these workers could inflict considerable damage and pain to the U.S. economy. President Biden cited the devastating effects of a rail strike, pointing to the possible loss of 765,000 jobs. In 1877, railroad workers shut down the economy of the United States in a time where rail transportation was the primary way to ship material interstate. Rail workers were few, but powerful. Today, rail workers are an even smaller portion of the labor force, but they still wield power as essential workers.

 

·     Industry turmoil: In the late 1800s, the United States was in the throes of an economic decline precipitated by a financial panic. The railroads were the primary source of interstate transportation (and also a new, growth industry, and thus their securities were susceptible to price fluctuations). The railroad industry of the 21st century also faced considerable turmoil, including international pressure. Following a steady decline since the 1940s, employment in the railroad sector remained relatively stable from the 1980s until 2018, when employment numbers began to drop. One reason for this decline in jobs was the decrease in shipments of coal resulting from a shift away from fossil fuels. Another reason was the uncertain trade relationships the United States had with key partners, particularly China. Tariff threats between the two countries involving both agricultural products and manufactured goods caused rail companies to reconsider hiring new employees. Company practices also played a role. In the early 2000s, the railroad companies began to pursue a business model that emphasized boosting profits by reducing labor costs. The implementation of precision scheduled railroading (PSR) allowed railroads to operate more efficiently, but it also eliminated the business’s ability to have staffing cushions or manage unforeseen circumstances, such as weather disruptions. Finally, like all industries, the nationwide shutdowns forced by the COVID-19 virus outbreak caused widespread unemployment in the railroads. When the economy began to recovery from the pandemic in 2020, the industry faced staffing shortages, and made increasing demands on workers’ already stressed schedules. Train operators don’t have regular days off; when they return from a trip, they are rotated to the bottom of the staffing list to give them time off. However, if the staffing list is short, workers have little to no time off, and are discouraged from taking any paid leave. With deteriorating work conditions, attrition increased, exacerbating the railroad companies’ already stretched staffing problems. As was the case in many other sectors, the “Great Resignation” impacted the rail business, as older workers opted to retire, and younger workers prioritized work-life balance over wages.  So, as in the late nineteenth century, the industry looked to labor reductions to cope with changes in externalities.

 

·     Lack of dignity, status, and function: In the 19th century, workers felt devalued for a number of reasons. As America industrialized in the early 1800s, skilled workers saw themselves as partners with management; management and labor both had a seat at the table to negotiate work conditions, output, wages, and goals. In a way, these early years of labor reflected Drucker’s idea of Management by Objectives. Each party saw themselves as having responsibility for the organization’s success. However, as industrialization matured in the late 1800s, coupled with immigration of lower-skilled labor, relations between management and labor soured. Growing class division and economic uncertainty fueled the working class’s sense that they were inferior, unvalued, underpaid, and lacking in status and function. The Great Railroad Strike was but the first of many labor actions that reflected this sense of indignity in a country that preached that hard work would equal success. In 2022, dignity for workers of all kinds means not just money. Railroad workers are highly paid, but cannot take time off for personal needs, such as doctor visits. In the 21st century, dignity involves being treated as a human being, not an economic being. Drucker wrote about this tirelessly. We should not be surprised that workers who cannot have time to have a meaningful life outside of work should be unhappy and unproductive. Railroad workers are not merely labor inputs.

 

Now, the historical divergences.


·     Union power: The Great Railroad Strike of 1877 did not involve union participation because there was no railroad union. Today, there are multiple unions representing the various trades associated with railroad work (37 railroads and 12 unions), including machinists, train operators, electricians, blacksmiths, and transportation communication professionals. The interests of all of these parties are not the same. Negotiating a labor agreement requires balancing the desires of all participants and involves compromise. The 2022 agreement was criticized by many – a sign that it was a compromise that involved parties giving in on positions. In 1877, workers had no bargaining power, and violence became the tool of last resort.


·     Unimportance of wages: The Great Strike of 1877 was primarily about wages (and job retention). The workers of 2022 were paid well; the average pay for a train conductor in 2022 was $53,571, and they certainly did not want more hours! The issue in 2022 was about time. As discussed previously, dignity, status and function – aspects that Drucker emphasized from the beginning of his writing – are key in both of these labor actions. In 1877, wages and more hours were valued. Today, workers value time with their families, time to take care of their personal needs, and having a life outside of work, especially if they are an essential worker, stretched to the limit during the pandemic and the years of recovery after. Money is important to cope with inflation and financial stressors, but this strike shows that highly-paid workers can still feel undervalued.


·     Technology: In 1877, the railroads were still relatively new technology. The financial meltdown in 1872 was a result of speculation in railroad securities. By 2022, rail transportation was a very old industry that has undergone major shifts to stay alive and relevant. The railroad industry, like many others, has seen an increased use of technology and a subsequent shift in job requirements for workers. Rather than rely on human eyes for inspecting tracks and equipment, companies use drones and sensors to collect large amounts of information and rely on data analytics to streamline operations and improve safety and efficiency. Positive Train Control (PTC) uses Artificial Intelligence and algorithms to determine the location, direction, and speed of a train on many routes, notifying the train operator of a problem and, if no action is taken, stopping the train. Those tasked with developing and using these new technologies are a new kind of knowledge worker in the rail industry.

 

 

Takeaways


·     Knowledge workers are essential workers too. The pandemic shed light on existing class divisions (as well as ethnic, racial, and gender divides). People celebrated “essential” workers who were visible, working on the front lines. But many other workers were just as “essential,” managing freight traffic to accommodate the shift towards purchasing consumer items during the lockdowns. When the economy reopened, these same workers were tasked with managing supply chain issues. In the 19th century, railroad workers were, for the most part, skilled labor. They are even more so now. We need to think through who is an “essential” worker and what is “knowledge” work.


·     All workers need balance. Workers in the 1800s needed adequate wages and hours to survive – but not to the point of being worked to death. Once unionization provided some control over wages, workers in the late 1800s and early 1900s were pushing for balance. “Eight hours labor, eight hours recreation, eight hours rest” became the rallying cry for an eight-hour work day. Knowledge workers may scoff at such an idea, but for manual laborers in heavy industry, physical labor takes a toll. Today, it is easy for knowledge workers to toil for 12 plus hours a day. But the pandemic created a shift in attitudes about work/life balance. We all need time to manage personal needs (doctor appointments, child care, etc.). Even if work isn’t physically grueling, it shouldn’t prevent us from being human beings.


·     Wages are important in an inflationary environment, but time is more important. Early labor actions fought for better wages and work conditions. Today, wages are important, and lower-skilled workers are fighting for better pay to keep up with the cost of living. Knowledge workers also need to be paid a reasonable wage or salary, especially given our inflationary environment. However, increasingly, time is more valuable to people than money. At some point, the utility of time outweighs the utility of money. The Great Resignation and the threatened railroad strike show that we are seeing this economic tradeoff become more widespread.


·     All workers need a sense of dignity, status, and function. This sounds great. What does it actually look like? It is complicated. In the 1800s, American society began to sort people into an increasingly divided class system, with industrial workers (no matter how skilled) at the bottom. The managerial and professional class began to rise as the new middle class (replacing teachers, tradesmen, and others of the old pre-industrial era), while the wealthy plantation owners and merchants were joined (in many cases surpassed) by a growing upper class of industrial elite. When the working class of the United States sensed a lack of dignity, status and function, they rebelled – and organized. When the organized railroad workers of 2022 sensed a lack of dignity, status and function as a result of years of overwork, they spoke. It seems to me that if managers can grasp the importance of such key aspects of MLA (dignity, status, function), then we can prevent such actions in the future. And, if we can view things through the lens of a social ecologist, we can see the bigger picture, understanding how history can teach us how not to repeat the errors of the past.

 

https://www.digitalhistory.uh.edu/disp_textbook.cfm?smtid=2&psid=3189

https://www.nytimes.com/2022/09/15/business/economy/railroad-workers-strike.html

https://www.aar.org/article/the-future-of-rail/

https://www.bls.gov/opub/mlr/2021/article/employment-in-rail-transportation-heads-downhill-between-november-2018-and-december-2020.htm

https://www.whitehouse.gov/briefing-room/statements-releases/2022/11/28/statement-from-president-joe-biden-on-averting-a-rail-shutdown/

https://raillaborfacts.org/bargaining-essentials/the-parties/

https://www.glassdoor.com/Salaries/railroad-conductor-salary-SRCH_KO0,18.htm

https://www.nelp.org/blog/this-week-in-labor-history-remembering-the-adamson-act/


On Decisions and their “Agents”

By Richard Johnson Ph.D. • December 17, 2025
This essay was inspired by an article recently published by Karen Linkletter and Pooya Tabesh (2025). They were in search of the meaning of “decision” in the works of Peter Drucker. To this end, they used Python to identify and locate all the times the word, “decision”, came up in Peter Drucker’s oeuvre . They then characterized the contexts (“themes”) in which the word came up. The result was a nuanced but very clear characterization of the evolution of his thinking on the topic. Here, we will focus on a key theme for Drucker: the case where your decisions involve other people’s decisions and actions . For present purposes, we can start with their statement: One of Drucker’s valuable contributions to the literature on decision-making is his adamance that implementation be built into the decision-making process.” (Linkletter and Tabesh 2025 8) To be clear, “…it is not a surprise that his integration of implementation of and commitment to decisions is part of his process of decision-making. He argues that a decision “has not been made until it has been realized in action.” (2025 8) The question, therefore, is how to make this happen, how to turn an organization from an aggregate of individuals whose decisions may or may not be aligned, into an agent—an entity that makes decisions, implements them, and then ascertains that what was done was, in fact, what was decided, as we try to do when making purely individual decisions. Let’s look at the matter more closely… A few years ago, I read a story about a road crew that was painting a double-yellow line on a highway. In their path was a dead raccoon that had been hit by a car or truck. It was lying right in the middle of the road. The crew didn’t stop. Someone later took a picture of the dead raccoon with a double-yellow line freshly painted right over it. The picture is below. It went viral on the Internet.

Paul Polman: Management, Sustainability, and Stewardship as a Liberal Art

By Robert Kirkland Ph.D. • December 17, 2025
When Paul Polman became CEO of Unilever in 2009, he did not inherit a troubled company. He stepped into a large global enterprise with familiar consumer brands that sat on shelves in cities from Amsterdam to Manila. Even with that scale and reach, the business rested on foundations that were beginning to crack. Public faith in multinational firms was fading, climate change was moving from a distant worry to a financial reality, and investors were increasingly locked into the rhythm of quarterly results that encouraged short term decisions and discouraged real strategy. Polman’s answer was surprisingly philosophical for a leader of such a company. Rather than defend profitability as the central corporate purpose, he attempted to redefine what the company was for. His response may suggest a contemporary expression of Peter Drucker’s idea of Management as a Liberal Art. Drucker described management as a moral undertaking that must be anchored in judgment, responsibility, and service, not only in efficiency or cost control. Redefining Corporate Purpose Soon after taking the role, Polman stunned many investors by ending quarterly earnings guidance. He went further and encouraged investors who focused only on short term returns to place their money elsewhere (Polman and Winston, 2021). The gesture appears to have been meant to reset the company’s relationship with financial markets. Drucker consistently argued that true leadership cannot be tied to the emotional fluctuations of short term financial reporting. By refusing to follow the ninety day cycle, Polman gave Unilever enough breathing space to think about long term issues. He also sent a powerful message inside the company. Unilever would no longer place shareholder extraction above every other consideration. Drucker might say that Polman was returning management to a place where purpose and meaning had priority. Drucker had long argued that institutions must be run for durability and social legitimacy, not just for quarterly outcomes (Drucker, 1946). The Unilever Sustainable Living Plan In 2010, Polman introduced the Unilever Sustainable Living Plan, which attempted to grow the company while reducing its environmental footprint (Unilever, 2010). The plan contained measurable goals for carbon emissions, water use, waste, sustainable sourcing, health, hygiene, nutrition, and economic livelihoods in the supply chain (Unilever, 2018). This was not presented as charity. It was presented as the business model itself. This approach fits well with Drucker’s view that a company must justify its existence through contributions to the common good (Drucker, 1946). Polman noted that a company serving billions of consumers could not thrive in a world marked by climate disruption, fragile supply chains, and social instability (Polman and Winston, 2021). He reframed sustainability as a competitive requirement. There are many examples of how this mindset influenced operations, such as targeted efforts to stabilize incomes for small farming communities or reduce water dependency in detergent production. Drucker would likely describe this approach as a return to institutional citizenship, which is the idea that power involves obligation (Drucker, 1989 and 1993). Human Dignity in Management Drucker believed that effective management is inseparable from human dignity. He argued that organizations must offer people both identity and contribution (Drucker, 1946). Polman appeared to take this to heart. Under his leadership, Unilever pushed for higher wages, safer working conditions, and expanded training programs across its vast networks of suppliers and small scale producers (Unilever, 2018). He also shifted language in a revealing way. Polman preferred speaking about farmers and families rather than vendors and suppliers (Polman and Winston, 2021). This change hinted at a deeper moral view of business. It positioned Unilever as a partner invested in the stability of the people who provided its raw materials. That reading fits closely with the idea of management as a liberal art, which sees leadership as an act of stewardship for the growth of people, not just the supervision of tasks (Drucker, 1989). Climate Leadership and Ethical Risk Management Drucker warned that management cannot be reduced to engineering efficiency. Managing also requires wrestling with consequences (Drucker, 1990). Polman pressed Unilever to treat climate risk as a direct business issue. He connected environmental damage to cost volatility, to consumer trust, and to the company’s long term future. Under his leadership, Unilever accelerated its use of renewable energy, sustainable materials, lighter packaging, and lower water use in many products (Unilever, 2010 and 2018). Polman’s climate agenda blended science, logistics, ethics, psychology, and an understanding of global politics. Drucker described this type of synthesis as central to Management as a Liberal Art. Responsible executives, he argued, must integrate many forms of knowledge into decisions (Drucker, 1989 and 1993). Polman framed sustainability as fiduciary responsibility rather than philanthropy. His influence is still visible in the way many global firms now treat environmental commitments as strategy rather than charity. This framing closely reflects Drucker’s view that corporate social responsibility must be rooted in a firm’s core mission, capabilities, and day-to-day operations rather than treated as a separate act of goodwill. By embedding sustainability into Unilever’s strategy and value chain, Polman demonstrated Drucker’s argument that responsible management integrates social obligations into how the business competes and performs, allowing ethical action and profitability to reinforce rather than undermine one another. Reviving Stakeholder Capitalism Polman helped restore credibility to the idea of stakeholder capitalism. He insisted that corporations must serve employees, consumers, suppliers, communities, and the environment rather than focus only on investor returns (Polman and Winston, 2021). He also pushed Unilever to evaluate brand performance partly through its social or health impact (Unilever, 2018). Under this model, brand equity included moral equity. This aligns with Drucker’s view that corporate legitimacy must be earned and never assumed (Drucker, 1989). For Polman, consumer trust was a survival requirement. When customers believe that a firm contributes to a worsening world, the company risks losing not just reputation but also the permission to operate (Drucker, 1990). Moral Leadership and Institutional Courage Polman spoke in moral terms more openly than most executives. He frequently challenged governments that fell short on climate commitments and he encouraged other business leaders to adopt fair labor standards and responsible tax behavior (Polman and Winston, 2021). Drucker argued that real authority is moral before it is positional. Polman’s conduct fits that idea well (Drucker, 1989 and 1990).  Inside the company, Polman asked employees to see themselves as contributors to social improvement and not merely as managers of brands or operations (Unilever, 2010). This practice reflects MLA. Drucker believed that people should find meaning and contribution through their work, not only wages (Drucker, 1989). Performance, Profit, and Purpose Some critics argue that purpose oriented leadership reduces profitability. Polman countered this by pointing to performance. During his tenure, Unilever posted steady growth, especially in emerging markets, improved margins, and delivered strong long term returns (Unilever, 2018). He argued that long term value and social value reinforce one another (Polman and Winston, 2021). Drucker had long dismissed the idea that ethical leadership conflicts with economic effectiveness (Drucker, 1999). Even with strong performance, tension remained. Certain investors disliked the refusal to play the quarterly guidance game. Some environmental advocates believed Unilever could have moved faster on issues such as plastics. Drucker never said that Management as a Liberal Art would eliminate conflict. He said that it would give leaders a moral compass for navigating conflict in a transparent way (Drucker, 1989). Polman seemed to follow that guidance by making tradeoffs visible and by emphasizing choices that protected dignity, stability, and ecological viability (Drucker, 1990). Building a Network of Responsible Institutions After leaving Unilever, Polman co founded Imagine, an organization that works with senior executives to accelerate progress toward the United Nations Sustainable Development Goals (Polman and Winston, 2021). This next step reinforces the idea that sustainability for Polman is a theory of governance rather than a branding strategy. Drucker believed that modern society relies on networks of responsible institutions. These include corporations, governments, and nonprofit organizations that understand their interdependence and act accordingly (Drucker, 1946 and 1993). Polman’s post CEO work attempts to strengthen that network. He is essentially trying to rebuild the trust and cooperation among institutions that Drucker warned could erode in a fragmented society (Drucker, 1999). The Legacy of a Modern Druckerian Paul Polman’s leadership at Unilever provides one of the clearest contemporary examples of Drucker’s idea of Management as a Liberal Art. He treated the corporation as a civic institution rather than a simple profit generator. He wove climate stability, labor dignity, and social inclusion into the core of strategic planning. He asked brands to earn moral legitimacy. He emphasized supply chains as human communities. He took personal risks by arguing that corporations hold responsibility for the future of the planet on which their operations depend (Polman and Winston, 2021). In Drucker’s language, Polman practiced stewardship. He demonstrated that management concerns human beings, the communities they inhabit, and the ecological systems that support them (Drucker, 1989 and 1990). In an era shaped by climate upheaval, inequality, and declining institutional trust, Polman shifted the central question. Instead of asking whether companies can afford to care, he asked whether they can survive if they refuse to care at all. References Drucker, P. F. (1946). The concept of the corporation. New York: The John Day Company. Drucker, P. F. (1989). The new realities: In government and politics, in economics and business, in society and world view. New York: Harper & Row. Drucker, P. F. (1990). Managing the non-profit organization: Practices and principles. New York: HarperBusiness. Drucker, P. F. (1993). Post-capitalist society. New York: HarperBusiness. Drucker, P. F. (1999). Management challenges for the 21st century. New York: HarperBusiness. Polman, P., & Winston, A. (2021). Net Positive: How courageous companies thrive by giving more than they take. Harvard Business Review Press. Unilever. (2010). Unilever Sustainable Living Plan. Unilever PLC. Unilever. (2018). Sustainable sourcing and livelihoods progress report. Unilever PLC. World Business Council for Sustainable Development. (2019). Business leadership for a net-zero economy.

From a Functional to a Free Society-- The End of Economic Man: Drucker's Diagnosis of Totalitarianism

By Bo Yang Ph.D. • December 10, 2025
Peter Drucker suggested that readers view his first three books as a unified body of work: The End of Economic Man(1939), The Future of Industrial Man (1942), and Concept of the Corporation (1946). These works share a common theme: politics. Drucker did not think about politics like scholars who strictly follow modern social science norms. Instead, he viewed politics as part of social ecology and understood political events through the dynamic changes in social ecology. Despite having "corporation" in its title and using General Motors as a case study, Concept of the Corporation is indeed a book about politics. In this work, Drucker attempts to address the main issues that industrial society must resolve: the legitimacy of managerial authority, the status and function of managers and workers, and the power structure of society and organizations. In Drucker's own words, this is a book exploring the specific principles of industrial society. Corresponding to these specific social principles, Drucker had earlier attempted to develop a general social theory, which was the aim of The End of Economic Man and The Future of Industrial Man. The subtitle of The End of Economic Man is "The Origins of Totalitarianism." The book focuses on how society disintegrates in industrial societies and how totalitarianism rises. For Drucker, the real challenge of this topic isn't explaining how Hitler and Mussolini came to power, nor the actions of Germany and Italy in government, military, and economic spheres. Rather, it's understanding why some Europeans accepted clearly absurd totalitarian ideologies, and why others seemed potentially receptive to them. Drucker's writing style is argumentative. He clearly knew that to effectively advance his arguments, he needed to engage with popular theories of his time. Back then, there were two main explanatory approaches to Nazism and Fascism, which Drucker termed "illusions." Some viewed totalitarianism as ordinary political turmoil similar to previous historical revolutions. In their view, totalitarianism was characterized merely by cruelty, disruption of order, propaganda, and manipulation. Others considered totalitarianism a phenomenon unique to Germany and Italy, related to their specific national characters. Drucker thoroughly refuted explanations based on "national character." He believed that any historical approach appealing to "national character" was pseudo-history. Such theories always emphasize that certain events were inevitable in certain places. But all claims of "inevitability" negate human free will and thus deny politics: without human choice, there is no politics. If the rise of totalitarianism were inevitable, there would be no need or possibility to oppose it. Viewing totalitarianism as an ordinary revolution is equally dangerous. This thinking merely emphasizes how bad Nazis and Fascists were. But the real issue is that Europeans were not merely submitting out of fear—they were actually attracted to totalitarianism. And those attracted weren't just the ignorant masses but also well-educated intellectual elites, especially the younger generation. The world cannot defeat totalitarianism through contempt alone, especially if that contempt stems from ignorance. Understanding the enemy is a prerequisite to defeating it. Drucker identified three main characteristics of Nazism and Fascism (totalitarianism is a social type, with Nazism and Fascism being its representatives in industrialized Europe): 1. The complete rejection of freedom and equality, which are the core beliefs of European civilization, without offering any positive alternative beliefs. 2. The complete rejection of the promise of legitimate power. Power must have legitimacy—this is a long-standing tradition in European politics. For power to have legitimacy means that it makes a commitment to the fundamental beliefs of civilization. Totalitarianism denied all European beliefs, thereby liberating power from the burden of responsibility. 3. The discovery and exploitation of mass psychology: in times of absolute despair, the more absurd something is, the more people are willing to believe it. The End of Economic Man develops a diagnosis of totalitarianism around these three characteristics. Drucker offers a deeper insight: totalitarianism is actually a solution to many chronic problems in industrial society. At a time when European industrial society was on the verge of collapse, totalitarians at least identified the problems and offered some solutions. This is why they possessed such magical appeal. Why did totalitarianism completely reject the basic beliefs of European civilization? Drucker's answer: neither traditional capitalism nor Marxist socialism could fulfill their promises of freedom and equality. "Economic Man" in Drucker's book has a different meaning than in Adam Smith's work. "Economic Man" refers to people living in capitalist or socialist societies who believe that through economic progress, a free and equal world would "automatically" emerge. The reality was that capitalism's economic freedom exacerbated social inequality, while socialism not only failed to eliminate inequality but created an even more rigid privileged class. Since neither capitalism nor socialism could "automatically" realize freedom and equality, Europeans lost faith in both systems. Simultaneously, they lost faith in freedom and equality themselves. Throughout European history, people sought freedom and equality in different social domains. In the 19th century, people projected their pursuit of freedom and equality onto the economic sphere. The industrial realities of the 20th century, along with the Great Depression and war, shattered these hopes. People didn't know where else to look for freedom and equality. The emerging totalitarianism offered a subversive answer: freedom and equality aren't worth pursuing; race and the leader are the true beliefs. Why did totalitarianism reject the promise of power legitimacy? One reason was that political power abandoned its responsibility to European core beliefs. Another reason came from the new realities of industrial society. Drucker held a lifelong view: the key distinction between industrial society and 19th-century commercial society was the separation of ownership and management. The role of capitalists was no longer important. Those who truly dominated the social industrial sphere were corporate managers and executives. These people effectively held decisive power but had not gained political and social status matching their power. When a class's power and political status don't match, it doesn't know how to properly use its power. Drucker believed this was a problem all industrial societies must solve. Totalitarianism keenly perceived this issue. The Nazis maintained property rights for business owners but brought the management of factories and companies under government control. This way, social power and political power became unified. This unified power was no longer restricted or regulated—it became the rule itself. Why could totalitarianism make the masses believe absurd things? Because Europeans had nothing left to believe in. Each individual can only understand society and their own life when they have status and function. Those thrown out of normal life by the Great Depression and war lost their status and function. For them, society was a desperate dark jungle. Even those who temporarily kept their jobs didn't know the meaning of their current life. The Nazi system could provide a sense of meaning in this vacuum of meaning—though false, it was timely. Using the wartime economic system, the Nazis created stable employment in a short time. In the Nazi industrial system, both business owners and workers were exploited. But outside the industrial production system, Nazis created various revolutionary organizations and movements. In those organizations and movements, poor workers became leaders, while business owners and professors became servants. In the hysterical revolutionary fervor, people regained status and function. Economic interests were no longer important, freedom and equality were no longer important; being involved in the revolution (status) and dying for it (function) became life's meaning. The Nazis replaced the calm and shrewd "Economic Man" with the hysterical "Heroic Man." Though absurd, this new concept of humanity had appeal. What people needed was not rationality but a sense of meaning that could temporarily fill the void. Those theorists who despised totalitarianism only emphasized its evil. Drucker, however, emphasized its appeal. He viewed totalitarianism as one solution to the crisis of industrial society. From 19th-century commercial society to 20th-century industrial society, the reality of society changed dramatically. 19th-century ideas, institutions, and habits could not solve 20th-century problems. Capitalism could not fulfill its promises about freedom and equality, and neither could Marxism. It was at this point that totalitarianism emerged. Nazism and Fascism attempted to build a new society in a way completely different from European civilization. Drucker said the real danger was not that they couldn't succeed, but that they almost did. They addressed the relationship between political power and social power, proposed alternative beliefs to freedom and equality (though only negative ones), and on this basis provided social members with new status and function. The war against totalitarianism cannot be waged merely through contempt. Defeating totalitarianism is not just a battlefield matter. Those who hate totalitarianism and love freedom must find better solutions than totalitarianism to build a normally functioning and free industrial society. Totalitarianism gave wrong and evil answers. But they at least asked the right questions. Industrial society must address several issues: the legitimacy of power (government power and social power), individual status and function, and society's basic beliefs. These issues became the fundamental threads in Drucker's exploration of industrial society reconstruction in The Future of Industrial Man. The Future of Industrial Man: From Totalitarian Diagnosis to General Social Theory Both The End of Economic Man and The Future of Industrial Man feature the prose style of 19th-century historians. Even today, readers can appreciate the author's profound historical knowledge and wise historical commentary. For today's readers, the real challenge of these two books lies in Drucker's theoretical interests. He doesn't simply narrate history but organizes and explains historical facts using his unique beliefs and methods. In The End of Economic Man, Drucker developed his diagnosis of totalitarianism around three issues: power legitimacy, individual status-function, and society's basic beliefs. In The Future of Industrial Man, he also constructs a general social theory around these three issues. In "What Is A Functioning Society," Drucker explains three sets of tensions that exist in social ecology: 
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