Realizing Hope Life Beyond Capitalism
By Michael Albert
Zed Books Ltd Copyright © 2014 Michael Albert
All rights reserved.
ECONOMIES INCORPORATE AN almost infinite array of components. Even if they have the same type of economic system, two different societies, whether France and Mexico, or the U.S. and South Africa, will have a myriad of economic differences ranging from population numbers and skills to resources and infrastructure, different industries, organizational approaches, patterns of ownership, secondary economic institutions, class histories and relations, and details of organization.
The same will hold for other economic types than capitalism. Different societies with new participatory economies, say a future Italy, Mexico, the U.S., Malaysia, Venezuela, Poland, Turkey, and South Africa, will have different features beyond the few shared ones that define the economic type. Participatory economics is a proposal for the defining features of a post-capitalist economy.
Capitalism's first defining feature is private ownership of the means of production. A few per cent of the population own almost all industry, machinery, resources, and farmland. They control the disposal and use of this property. They accrue profits from their property's productivity.
Capitalism is also defined by corporate divisions of labor and authoritative decision making. About 20 per cent of the employees of capitalist workplaces do mostly conceptual and empowering tasks, while the other 80 per cent do mostly rote and obedient tasks. The 20 per cent make many decisions and affect social choices. The 80 per cent make few decisions and mainly obey orders.
People's income in capitalist economies comes mostly from their bargaining power. We get from economic output what we can take. Ownership of property conveys rights to profit. The control one has over needed assets or skills, the value of the output one generates, one's social attributes like gender and race, and one's organizational affiliations such as union membership, also convey greater or lesser ability to accrue income.
Another defining feature of capitalism is markets. Markets mediate the amount of any particular good or service produced, the relative valuations of different products, and their distribution to different actors. Buyers and sellers benefit themselves, oblivious to impact on others. I sell at the highest price I can get the least costly items I can deliver. You buy at the lowest price you can offer the most valuable items you can amass. We fleece each other.
Competition drives growth and determines relative valuations. The preferences and bargaining power of buyers and sellers determine prices. The preferences of people who are affected by but aren't directly involved in specific transactions go unaccounted. Your desire for a car you seek to buy influences its price. My dislike for the pollution that it will spew doesn't influence its price. In market exchanges those with more power make out like bandits and "nice guys finish last".
Beyond private ownership of means of production, corporate workplace organization, authoritative decision-making, remuneration for bargaining power, property, and output, and market allocation, myriad variations in secondary institutions, population, local history, and impositions from other parts of society distinguish different instances of capitalism from one another. South Africa is different from the United States. England circa 1900 is different from England circa 2000. India is different from Mexico.
Referring to capitalism, John Stuart Mill, one of the foremost philosophers of the nineteenth century wrote, "I confess that I am not charmed with the ideal of life held out by those who think that the normal state of human beings is that of struggling to get on; that the trampling, crushing, elbowing, and treading on each other's heels, which form the existing type of social life, are the most desirable lot of human beings".
More recently, the great Latin American writer Eduardo Galeano explained how capitalism has nearly all its valuations upside down: "From the point of view of the economy, the sale of weapons is indistinguishable from the sale of food. When a building collapses or a plane crashes, it's rather inconvenient from the point of view of those inside, but it's altogether convenient for the growth of the gross national product, which sometimes ought to be called the 'gross criminal product'."
In my own view, only briefly evidenced here, capitalism is a thug's economy, a heartless economy, a base and vile and largely boring economy. It is the antithesis of human fulfillment and development. It mocks equity and justice. It enshrines greed. It does not serve humanity.
I doubt that many who are reading this book will contest these claims. Similar characterizations of capitalism, for example, are rampant in contemporary literature and other media. In fact, I think that while many people might talk about a humane capitalism, or might not publicly decry capitalism, deep down this isn't due to denying capitalism's ills or to feeling capitalism is liberatory. It is due to feeling there is nothing possible but capitalism, so that operating within its jurisdiction is unavoidable and decrying capitalism is whining about the inevitable. In any event, given my distaste for capitalism, I feel the need to proceed to a better economy.
Participatory economics has completely different defining features than capitalism. Extensive explorations of its economic logic are available online at the parecon web site (www.parecon.org). I don't want to repeat all that here, but preparatory to discussing participatory economics and the rest of society I do want to summarize parecon's main features. Parecon seeks to fulfill four key values: solidarity, diversity, equity, and self-management.
The first value a good economy ought to have bears upon how its workers and consumers relate to one another. In capitalism, to get ahead, one must trample others. To increase your income and power you must ignore the horrible pain suffered by those left below or even help to push them farther down. In capitalism, not only do nice guys finish last, but in my own somewhat more aggressive formulation of the same sentiment, "garbage rises".
In contrast to the capitalist rat race, a good economy should be a solidarity economy, generating sociality rather than social irresponsibility. Its institutions for production, consumption, and allocation should propel even antisocial people into addressing other people's well being to advance their own. To get ahead in a good economy, in other words, you should have to act on the basis of considering and respecting the conditions of others.
Interestingly, this first parecon value, so contrary to the capitalist logic of "me first and everyone else be damned", is entirely uncontroversial. Only a psychopath would argue that if we could have the same output, the same conditions, and the same distribution of income, an economy would be better if it produced more hostility and anti-sociality in its participants than if it produced more mutual concern. Other than psychopaths, we all value solidarity and would prefer not to trample others. Solidarity is thus parecon's first value.
The second value a good economy ought to advance has to do with the options an economy generates. Capitalist market rhetoric trumpets opportunity but capitalist market discipline curtails satisfaction and development by replacing what is human and caring with what is commercial, profitable, and in accord with existing hierarchies of power and wealth. The tremendous variety of tastes, preferences, and choices that humans naturally display are truncated by capitalism into conformist patterns imposed by advertising, by narrow class-delimited role offerings, and by coercive marketing environments that produce commercial attitudes and habits.
As a result, within capitalism we seek best sellers regardless of their impact on society, instead of seeking a wide range of sellers with as desirable an impact as possible. We seek the one most profitable method of doing each task instead of many parallel methods suiting a range of priorities, and we seek the biggest of almost everything, virtually always crowding out more diverse choices that could engender greater and more widespread fulfillment.
In contrast, responsible institutions for production, consumption, and allocation not only wouldn't reduce variety but would emphasize finding and respecting diverse solutions to problems. A good economy would recognize that we are finite beings who can benefit from enjoying what others do that we ourselves have no time to do, and also that we are fallible beings who should not vest all our hopes in single routes of advance but should instead insure against damage by exploring diverse parallel avenues and options.
Interestingly, this value of diversity, like solidarity, is entirely uncontroversial. Only a perverse individual would argue that, all other things being equal, an economy is better if it homogenizes and narrows options than if it diversifies and expands them. So we value diversity, not homogeneity. Diversity is parecon's second value.
The third value we want a good economy to advance has to do with distribution of outputs. Capitalism overwhelmingly rewards property and bargaining power. It says that those who own productive property, by virtue of their ownership, deserve profits. It says that those who have great bargaining power based on anything from monopolizing knowledge or skills, to using better tools or organization, being born with special talents, or being able to command brute force, should get whatever they can take.
A good economy would instead be an equity economy whose institutions for production, consumption, and allocation not only wouldn't destroy or obstruct equity, but would propel it. But what is equity?
People seeking equity, of course, reject rewarding property ownership. It can't be equitable that due to having a deed in your pocket you earn 100, 1000, or even a million or ten million times the income some other person earns who works harder and longer than you. To be born and inherit ownership and by virtue of that ownership, despite having done nothing of merit, to vastly exceed other's circumstances and influence, cannot possibly be equitable.
We also reject rewarding power with income. The logic of Al Capone, Genghis Khan, and the Harvard Business School is that each actor should earn as remuneration for their economic activity whatever they can take. This norm worships not equitable outcomes, but being a thug. Since we are civilized, we of course reject it.
What about output? Should people get back from the social product an amount equal to what they themselves produce as part of that social product? After all, what reason can justify that we should get less than what we ourselves contribute, or for that matter that we should get more than our own contribution? Surely we should get an amount equivalent to what we produce, shouldn't we?
It may seem so, but suppose Bill and Jill do the same work for the same length of time at the same intensity. If Jill has better tools with which to generate more output, should she get more income than Bill, who has worse tools and as a result generates less output even though working as hard or harder?
Similarly, why should someone who happens to produce something highly valued be rewarded more than someone who happens to produce something less valued though still socially desired – again, even if the less productive person works equally hard and long and endures similar conditions as the more productive person?
Extending the same logic, why should someone who was lucky in the genetic lottery, perhaps inheriting genes for big size, musical talent, tremendous reflexes, peripheral vision, or conceptual competency, get rewarded more than someone who was genetically less lucky?
You are born with a wonderful attribute. You didn't do anything to get it. Why, on top of the luck of your inheritance, are you rewarded with greater income as well? There is no earning happening. No high morality is evidenced. You were just lucky.
In light of the implicit logic of these examples, it seems that to be equitable, remuneration should be for effort and sacrifice in producing socially desired items.
If I work longer, I should get more reward. If I work harder, I should get more reward. If I work in worse conditions and at more onerous tasks, I should get more reward. But I should not get more for having better tools, or for producing something that happens to be valued more, or even for having innate highly productive talents, nor should I get more even for the output of learned skills (though I should be rewarded for the effort and sacrifice of learning those skills), nor, of course, should I get rewarded for work that isn't socially warranted.
Unlike our first two values, solidarity and diversity, our third value of rewarding only the effort and sacrifice expended in socially valued work, is quite controversial.
Some anti-capitalists think that people should be rewarded for the overall volume of their output, so that a great athlete should earn a fortune, and a good doctor should earn way more than a hard working farmer or short order cook. An equitable economy, however – or at any rate a participatory economy – rejects that norm.
Pareconish equity requires that assuming comparable intensity and duration of work, a person who has a nice, comfortable, pleasant, and highly productive job should earn less than a person who has an onerous, debilitating, and less productive but still socially valuable and warranted job, due to the sacrifice endured. Parecon rewards effort and sacrifice expended at socially valued labor; it does not reward property, power, or output. You have to produce socially valued output commensurate to the productivity of your tools and conditions, yes, but you are remunerated not in accord with the value of the output, but with the effort and sacrifice you expend.
There are two other anti-capitalist stances regarding remuneration. They have in common that they take a wise insight to a counterproductive extreme.
The first approach says work itself is intrinsically negative. This stance wonders why anyone thinking about a better economy would worry about organizing or apportioning work. Why not eliminate it?
This stance correctly notices that our efforts to innovate should seek to diminish onerous features of work in favor of more fulfilling features. But it moves from that worthy advisory to advocating entirely eliminating work, which is nonsense.
First and most obviously, work yields results we do not want to do without. The bounty that work generates justifies the costs of undertaking it. In a good economy, people would desist from excess work before suffering insufficient returns for it. In parecon, we expend our effort and make associated sacrifices only up to the point where the value of the income we receive outweighs the costs of the exertions we undertake. At that point, we opt for leisure, not for more work.
Second, as the famed geographer and anarchist Peter Kropotkin expressed the point, "Overwork is repulsive to human nature – not work. Overwork for supplying the few with luxury – not work for the well-being of all. Work, labor, is a physiological necessity, a necessity of spending accumulated bodily energy, a necessity which is health and life itself".
In other words, the merits of work are not solely in its outputs, but also in the process and the act itself. We want to eliminate work that is onerous and debilitating, yes, as well as eliminating unjust remuneration for it, but we do not want to eliminate work per se. We need to keep work, but to figure out how to do it differently than now.
A second and related anti-capitalist stance claims that the only criterion for remuneration ought to be human need. "From each according to ability, to each according to need" defines this perspective.
What this stance rightly highlights is that people deserve respect and support by virtue of their very existence. If a person can't work, surely we don't starve them or deny them income at the level others enjoy. Their needs, modulated in accord with social averages, are met. If, likewise, someone has special medical needs, these too are met even beyond the volume, intensity, or type of work the person is able to do.
The problem with rewarding need arises not when we are dealing with people who are physically or mentally unable to work, for which it makes perfect sense, but when we try to apply the norm to people who have no special medical needs interfering with their working.
For example, can I do no work and still benefit from society's output? Can I do no work and consume as much as I choose, with no external limits? This is obviously not viable. We could have no one at all working and at the same time have everyone expecting to consume more than now.
Usually what those who advocate payment for need and people working to capacity have in mind is that each actor will responsibly opt for an appropriate share of consumption from the social total and will responsibly contribute an appropriate amount of work to its production. (Continues...)
Excerpted from Realizing Hope Life Beyond Capitalism by Michael Albert. Copyright © 2014 Michael Albert. Excerpted by permission of Zed Books Ltd.
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