JASON SCHULMAN

I appreciate David Schweickart’s response to my critique of his “Economic Democracy” vision, which helps me to clarify what I see as the problems with it as an “end-goal” for the socialist movement. (And I apologize if my tone was perhaps too antagonistic.)

First, I’ll happily acknowledge the gray area between certain “market socialists”  like David and advocates of more comprehensive democratic planning — like Pat Devine and Fikret Adaman, who are the real authors and developers of “negotiated coordination” — who accept a role for market mechanisms but emphasize that social choice and planning will have the central role in regulating the economy. Market exchange will have simply have a role,  particularly in areas pertaining to individual choice of products.

I would perhaps be less adamant in my “anti-market” views if David and those who agree with him would simply drop the term “market socialism.” Obviously, socialists can’t make markets a “good” in themselves in the way that Hayekian liberals and conservatives can. David can’t really be a “market socialist” but only a socialist who sees some value in markets in serving to further socialist goals.

I think it’s a mistake for socialists to politically refer to their vision as “market-anything.” It conflicts with our fight for reforms which have to do with expanding the power of democratic and collective social choice  over markets (what I would call “anti-market politics”). Socialist goals are incompatible with “market ideology” and this has to be made clear in the label that we give to our vision. (“Economic Democracy” is fine, of course, as a general label for “socialist economy.”)

My Main Fear: A “Market Socialist” Economic Elite

David argues that market competition between co-operatives is less cut-throat than between traditional capitalist firms: “A firm does not want to lose market share to a competitor, but neither does it want to drive its competitor out of business.” But doesn’t this interfere with the efficiency which Economic Democracy (ED) is supposed to have due to its retention of competitive markets in consumer goods? Are there not losers as well as winners under ED? Won’t the existence of these losers be incompatible with the values of equality and solidarity we associate with socialism?

Is it not at all likely that the “winning” co-op workers would want to accumulate more wealth than they can under ED? I suspect they would. And they would resent the redistribution of their wealth in the form of the welfare state, for why would they want to subsidize those whom the market had fairly and impartially — if harshly — judged?

One does not have to desire complete equality (whatever that might mean — cf. Marx, Critique of the Gotha Programme) to worry that even ED would generate an economic elite. And that elite would fight to remove all the genuinely socialist aspects of ED, particularly if they were aided by a group of entrepreneurial capitalists (as David has said elsewhere should still exist). I suspect that such an elite is an inevitable result of any economy where market forces remain a major determinant of the allocation of investment and most firms continue to act atomistically, with their interdependent decisions being coordinated after-the-fact by markets rather than “before hand” through a process of participatory planning. (In ED it is very unclear to me how local community needs will remain predominant under the more general criteria of profitability which is key to David’s vision of social investment. What happens when the two contradict each other?)

I might be wrong. We can’t be sure, as we’ve never something like David’s system within the context of a radically democratic state. Of course, we’ve never seen comprehensive planning within such a context either. So David can’t be certain of the nonfeasiblity of “negotiated coordination” either, especially as it differs from the USSR-type model which David and I — and Devine and Adaman — have no desire to revive. I can be certain, however, that Devine’s system would not generate an economic elite — which is why I find his line of thinking more promising than David’s.

Responding to David’s Critique

In the interest of brevity, I’ll simply reiterate the points that were made by Comrade R. Burke in the comments section of David’s post.

First, Devine puts his model of negotiated cooperation within a context of social ownership, defined as ownership by those who are affected by, who have an interest in, the use of the assets involved.  So those involved in the negotiation process would already have access to funds — it is simply a question of how to use them.

Second, governments are a part of the negotiated cooperation process, and would be collecting taxes just as under Mr. Schweickart’s proposals, which would obviously be available to negotiated cooperation bodies.

Thirdly, the process of negotiation occurs at several levels. Devine writes: “the social owners will differ according to the scope, the reach, of the activity or decision involved. Thus, the principle of subsidiarity applies: social ownership should be defined and decisions should be made at the most local, decentralised level that is consistent with all, and only, those who are affected by the use of the assets involved participating in the decision-making process with respect to those assets. This means that a process of negotiated coordination would take place at all levels, from the local to the global, according to the characteristics of the activity in question.”

Fourthly, Devine has made some suggestions about how local communities could make available facilities for small scale enterprises, which would not be a part of the negotiated cooperation process unless they grew to a larger size.

Fifthly, Devine’s proposals are based on a certain amount of empirical data, starting with the fact that limited forms of negotiated cooperation have actually been tried and found effective. He uses the example of wartime Britain, where such a process was used quite effectively, but was dismantled ironically by the 1945 Labour government because of its association with wartime austerity, not because of ineffectiveness. He also points to historical attempts at market socialism, which led either to a combination of central planning and markets — as in Hungary, or to an abandonment of planning altogether — as in Yugoslavia. In both cases the results were less than desirable.

I would add that Devine pays more attention than does David to the need to overcome the social — as opposed to technical — division of labor.  Again, quoting Devine:

Generalising from Marx’s distinction, we can classify activities, or labour, into different categories. I have suggested five: administering, directing and planning; creative activity; caring and nurturing; skilled activity; unskilled and repetitive activity … Within each category there is a wide variety of different functional activities. The first four categories, freed from the relationships of domination and subordination arising from the hierarchy of social power, are in different ways psychologically productive and contribute to the realisation of human potentiality. The fifth category is in general psychologically unproductive and an important social objective should be to reduce the amount of such activity that has to be undertaken.

Abolition of the social division of labour means ending the social stratification that arises when people spend their lives performing primarily just one category of activity, when they are defined by their jobs as skilled or unskilled workers, creative or caring workers, or are members of the establishment who direct and run society in all its aspects. It does not mean ending the functional division of labour. Rather, there would be an expectation that over their lives people would specialise in functional activities within each category, performing their share of the labour that is socially necessary within each category.

With the overcoming of the social division of labor comes the time to partake of different activities, including taking part in negotiation coordination. Hence, those working at self-managed enterprises would work less than David’s suggested “forty hours a week.” Nor is there any reason to think that negotiated coordination would involve endless meetings: Only decisions with respect to major investment would be made by negotiated coordination bodies, more-or-less like the decisions made by the headquarters of multi-division firms under capitalism. Moreover, the total social time involved in running a self-governing socialist society would be more evenly distributed among people.

Markets, Big-M and small-m

I’m willing to compromise partially with market socialists. No socialist should have any problem with what the Marxist economist James Westra has called “small-m markets,” the sorts that have “existed in the interstices of the world since ancient times, that may persist benignly in a socialist society.” Farmers’ markets don’t need to be abolished under socialism. Nor do any other types of markets that involve “independent democratic communities, largely insulated from the ravages of global markets, working ‘for themselves.’” But by and large, I believe that market forces — Big-M Markets — need to be replaced by participatory planning through negotiated coordination. The historically specific, integrated, “self-regulating” markets of the capitalist commodity economy need to enter the dustbin of history. And the usefulness of the work of Devine and Adaman is that it helps socialists say just what the alternative could be.

Works by Pat Devine can be found at http://charliemarks.wordpress.com/reading-material/.