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Goodbye Soviets?


The dissolution of the Soviet Union has been a severe psychic loss for many leftists. Why? The end of Soviet power has increased U.S. military dominance. There is a grave possibility of famine. Even without a new coup, Yeltsin and/or his counterparts in other republics could become dictators. And the possibility of widespread racial and ethnic violence is steadily climbing. On the other hand, recent events have also spurred demands for disarmament and conversion and released millions from one-party dictatorship and cultural domination. Moreover, massive, opposition has again curtailed elite machinations, and in response to inequality, unemployment, violence, and impoverishment, the new Soviet movements may arise.

However, these countervailing points don’t significantly assuage leftists any more than fear for the Soviet future most disturbs them. They mourn what has been lost. To them everyone’s future appears bleak because economic hope is gone. They accept the “End of Economic History” interpretation of Soviet decline:

  • The demise of the Soviet Union is the demise of communism and all economic planning. Capitalism and markets will live forever. Markets yes. Hope no.

Two less depressing economic analyses vie for attention. First, there is the “Optimistic Markets” view.

  • The demise of the Soviet Union is the demise of communism and all economic planning. Since markets are desirable, transcending capitalism requires retaining markets. The economic future need not be capitalist. We can instead join markets with state ownership. Markets yes. Hope yes.

Second, there is the “Participatory Economic” view.

  • The dissolution of the Soviet Union dissolves a Stalinist state, a coordinator economy (including central planning), and a repressive ethnocentric culture. Since markets are terrible, transcending capitalism requires jettisoning markets and avoiding central planning. The economic future need not be capitalist or coordinator. Markets no. It can join decentralized participatory planning with collective public ownership. Central Planning no. A more desirable new economy, yes.

 

The End of History

The end of history argument has some problems. If by “communism” its proponents mean a one-party state, central planning, authoritarian production, and cultural domination, then they are right, “communism” has died. Likewise, that death plus explanatory theoretical analysis has removed central planning from sensible visionary agendas.

But what justifies dismissing all planning? In fact, there is no evidence regarding the impossibility or undesirability of other types of planning or other ways to organize an economy. Not in any text, monograph, periodical, or speech.

The end of history deduction—that the future will necessarily remain forever capitalist—holds only if there can be no viable alternatives to capitalism. Since the only support for this claim is prejudice, we have no reason to fear an end of history.

 

Optimistic Markets

The optimistic markets claim that planning is universally undesirable is subject to the same criticisms as the end of history’s similar claim. Debunking central planning does not justify dumping all planning. Worse, celebrating markets as desirable is pure propaganda. In practice, markets have always produced grotesque inequality, rampant alienation, debauched ecology, a progressive decline of social concern, and sharp class division. For those not wearing blinders, this historical record should undercut claims that markets are ideal. Add to this compelling theoretical analysis that markets yield these ills regardless of accompanying ownership relations, and optimism about markets becomes ridiculous.

What does such theoretical analysis of markets include? Markets operate by way of buyers and sellers each seeking to attain the best conditions for their own aggrandizement. This competition makes markets run and decides the outcomes. In the ideal case, competition is perfect in that no units are big enough to tilt the playing field by significantly influencing pricing. In the real world, of course, units grow and combine until they are of varied sizes, including competition-thwarting oligopolies and monopolies.

Of the many intrinsic failings of markets, here are five. Remember, we are not even including unemployment, inflation, monopoly, corruption, and the commodification of politics, culture, etc.

(1) Antagonistic Roles

The competitive pressures of markets make cooperation irrational. Neither buyers nor sellers can afford to consider the situation of the other. Not only is relevant information unavailable, solidarity would be self-defeating. Polluters must try to hide their transgressions since paying a pollution tax or modernizing their equipment would lower profits. Even if one producer in an industry does not behave egocentrically, others will. Moreover, if the altruists persist in their socially responsible behavior they will ultimately be driven out of business for their trouble. In a market context, even workers’ councils motivated by humane considerations ultimately fail. Market competition therefore militates against solidarity and promotes duplicity, regardless of ownership relations.

(2) Antisocial Bias

While it requires more technical substantiation, markets are biased against the provision of goods with greater than average positive social effects (like parks and text books) and in favor of goods with less than average positive social effects (like nuclear waste and vodka). Market prices misestimate social benefits and costs for goods with social impact, and, as a result, misallocate related resources. Since these types of goods are ubiquitous and since consumers eventually bend their preferences toward relatively less expensive offerings and away from relatively more expensive offerings, constant misestimation of prices causes markets to produce egocentric behavior and antisocial outcomes, regardless of ownership relations.

(3) Commodity Fetishism and Insufficient Data

Markets coordinate economic activity by providing separate units the opportunity to offer their outputs in exchange for the outputs of others. Commodity relations between people and things or things and things are always evident. However social relations between people and people (such as consumers and the workers who produce for them or people in different firms that deal with one another) are obscured. This has been termed “commodity fetishism” and its corrosive ills are independent of ownership relations. Moreover, the only information markets provide, with or without private property, are prices of the commodities people exchange. Even if these prices accurately reflected the human and social relationships lurking behind economic transactions (and because of anti-social bias, they do not), they would not allow producers and consumers to adjust their activities in light of a self-conscious understanding of their relations with one another. The absence of information about the concrete effects of my activities on others leaves me little choice but to consult my own situation exclusively. The individualism this leads to impedes solidarity and efficiency, regardless of ownership relations.

(4) Workplace Hierarchy and Coordinator Class Dominance

Workers’ councils in Yugoslavia have long had the right to meet and make decisions, but why should they? Market competition forces decision makers to maximize a bottom line. Calculations are technocratic. Any human effects unrepresented in costs and revenues are ignored on pain of competitive failure. Since competitive pressures militate against criteria such as workplace satisfaction, it is perfectly sensible for workers’ councils (not wanting to explicitly oppress themselves) to hire others to make their decisions for them. The pattern is simple. First, worker desire for self-management erodes. Next, workers hire managers who in turn hire engineers and administrators who transform job roles according to competitive dictates. A process that begins with workers choosing to delegate technical and alienated decisions to “experts” ends by increasing the fragmentation of work, bloating managerial prerogatives, and substituting managers’ goals for those of workers. Shortly, a burgeoning managerial class of coordinators begins to maximize the size of the surplus earmarked for themselves and to search for ways to preserve their own social power. Couple this with market-induced alienation, apathy, egocentric personalities, and competitiveness, and it is easy to see why, even with workers’ councils, legal guarantees of workers’ rights, and no capitalists, markets foster the emergence of a new ruling class of coordinators, as in Yugoslavia.

The optimistic markets conclusion wrongly denies that markets engender grotesque ills regardless of accompanying ownership relations and suppresses the possibility that a nonmarket model could be desirable. The optimistic markets interpretation, like the end of history interpretation, has only prejudice and propaganda for support.

 

Participatory Economics

The participatory economic claim that the demise of the Soviet Union is the demise of an authoritarian, exploitative system—including central planning—is so self evident from the historical record that it ought not be controversial. I cannot parade thousands of pages of names of jailed and tortured souls, rehearse a litany of crushed working class institutions, exhibit the detailed mechanisms of cultural subordination, enumerate every detail of work under central planning directives and local workplace management, show the unique details of Soviet sexism, or describe the horrid details of KGB repression and Party domination, but we should all be able to agree that these ills have been at the core of Soviet history.

Yet, even for those who didn’t long ago reject the Soviet system as a horrible crime, surely the image of a population eager to reject even the names of their cities and towns reveals real hatred for the past system. The current display of violent ethnocentrism is not only grounds for concern, it also buries the idea that the Soviet system has nurtured liberated behavior. Coercively keeping antisocial hostility in check is not the same as promoting “socialist man” and woman. Finally, the presence of an economy so fantastically top-heavy, militarily biased, ecologically devastated, and unable to deliver even for its elites, ought to close the book on any claims to justice or rationality for the Soviet economic model.

Participatory economy’s second claim—that the only way to transcend capitalism will be to couple a new kind of decentralized planning with collective public ownership—is more problematic. Is it true that markets are so bad that incorporating them in a new economy automatically precludes desirable economics? And is state ownership so bad that we must instead try collective public ownership?

Regarding state ownership, it clearly leads to bureaucracy, privilege, inefficiency, elite control, and overwhelming central power, none of which promotes desirable economic outcomes. To avoid all this, dominion over property must avoid bureaucratic intermediaries able to exploit their roles. If “collective public ownership” isn’t a good name for this, fine, we can adopt another. But dispensing with state ownership is essential.

Regarding markets, I have made a brief case above and elsewhere I and others have made the case definitive. Moreover, readers can do the same with not much additional work. If this is so, what can we conclude? First, there is no reason to take the end of history and pro-market interpretations as gospel. They are propaganda. Second, a longterm abolitionist stance toward markets makes infinitely more sense than celebrating their virtues or resigning to their faults. Third, with the addition of a compelling argument for a better economy we could even adopt the participatory planning conclusion—that the future economy can be liberating—and work for that end.

Space precludes comprehensive treatment, but maybe I can briefly attest the possibility of a desirable economy.

For a desirable economy we would have to eliminate not only the capital/labor division—by making “capital” publicly owned and thereby no longer monopolized by a single class—but also the coordinator/worker division. Eliminating this means eliminating a division of labor that rewards some people with jobs that are more empowering, exert more influence, accrue more status, or earn more reward. But this requires dividing up work so that everyone has a fair mix of different responsibilities—conceptual and manual, skilled and unskilled, executive and executionary. While these egalitarian aims can’t be attained under capitalism or coordinatorism because they would undercut the class basis of those systems, nothing precludes attaining them in a desirable economy. Incentives can still operate effectively, partly by being more collective and social. Eliminating struggle between order-giving managers and planners and order-taking rote workers—by ensuring that everyone participates in decision making and does a fair share of onerous work—will free tremendous energy that must otherwise go to defending hierarchies and eliciting work from alienated employees. Comprehensively training everyone will tap immense new creative potential from all those people who now have little education and skills development. Indeed, unless racists, classists, and sexists are right that children of people of greater income are genetically disproportionately more able than children of people with lower income, this broadening of the pool of educated and skilled citizens would more than offset losses due to even exceptionally creative people having to their share of not so creative tasks.

The second main institutional change to attain a desirable economy is to empower all participants equally while simultaneously ensuring that decisions are reached without undo bother and according to norms of need and not profit. This is a hard nut to crack, but not impossible. In one vision, we could incorporate decentralized unit-to-unit planning in which each actor has a say in decisions proportionate to the degree he or she is affected by those decisions. The means of communicating proposals and responses could provide all the quantitative and qualitative data prerequisite to making intelligent choices that account for effects on material needs but also on personality, skills, social relations, etc. Doing this would require, in turn, installing democratic and participatory councils in work places and highly user-friendly means of communication among and between workplaces and industry and consumer council units of various sizes. These allocation tools would all facilitate a period of planning at the start of each new year and of updating for unexpected circumstances and changes as the year progresses. This participatory allocation would promote the same types of egalitarian concern as the nonhierarchical organization of workplace production and vice versa. Advertising, banks, tax bureaus, law firms, realty agencies and many other institutions as we know them would be replaced by democratic and more modest apparatuses with emphasis on facilitating planning and implementation, not on aggrandizing individual advantages.

Beyond making income and wealth equitable, balancing job allocation, and ensuring that allocation fosters proportionate participation in informed decision-making, most other changes in the switch to a desirable economy would be due to the choices that would be made rather than the institutions that would be employed. For example, if the economy was really to serve human development and fulfillment, people would need to make ecologically sound, healthful, and spiritually enriching choices. To this end, all we can ask of the economic institutions is that they prepare the kinds of informed, socially conscious actors that would be inclined toward making such decisions and that they provide the necessary information and allow for the needed follow through when such decisions are made. With this achieved, we can anticipate people eliminating redundant and wasteful production, ecologically unsound production, military production, and so on.

With Robin Hahnel I’ve described elsewhere how I think all this can be done, why it will work, and what its benefits will be. But even if the particular vision we offer doesn’t appeal to you, that would be no reason to quit seeking a new economy better than capitalism or coordinatorism. There is nothing about seeking economic improvement that is contrary to nature, technology, or human potential. On the contrary, to deny the possibility of economic progress implicitly advocates capitalist and/or coordinator injustice, exploitation, and even barbarism.


Conclusions

What has been lost in the Soviet Union and Eastern Europe is Stalinism in the polity, coordinatorism in the economy, and, hopefully, cultural homogenization in the community/cultural sphere of society. Do not cry that the Soviet people have somehow mistakenly rejected a desirable past. Their past had a degree of equity and security, yes, but also regimentation, authoritarianism, depression, alienation, and repression.

If we brush aside propaganda and unsubstantiated assertion, calls for an end of history or for a market-centered future lack support. In contrast, the case for seeking a new economic and social vision incorporating neither markets nor central planning and seeking to avoid class division and any fixed hierarchy of rewards or power makes no less sense now than it did a year or five or ten years ago. On that score, absolutely nothing has changed other than the potential removal of Leninist confusion.

The left agenda has to be to fight against denials of humanity, whether their form is capitalist or coordinator, fascist or Stalinist, patriarchal, heterosexist, or racist. But it must also be to fight for a classless economy, ecological diversity, participatory democracy, feminism, sexual liberation, and antiracist intercommunalism. These ultimate aims can sustain short and long term struggle in the U.S., the Soviet Union, Europe, and the Third World. The goal, still, is to make the world safe and desirable for all humanity. As Noam Chomsky expresses it: “The task for a modern industrial society is to achieve what is now technically realizable, namely, a society which is really based on free voluntary participation of people who produce and create, live their lives freely within institutions they control, and with limited hierarchical structures, possibly none at all.”

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