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May 10, 2014 at 5:22 pm #722707
Have you read, for example, Parecon: Life After Capitalism – or any other long presentation? Your question is basically saying to me – how does participatory planning work – and, well, since that is addressed, at length, carefully, in many places, it seems like the thing to do would be to read one rather than, well, asking me to essentially reproduce one here. Then, if you have a specific question, I could deal with that.
You didn’t get it right, or wrong. The real issue is, given an economy’s institutions, how does it arrive at relative prices, and what do they indicate? So, in a central planned economy, they are largely set by planners and indicate the will of planners. Of course planners may take into account all manner of other information, or may not. In a market system they are set largely by a kind of war – competition – between actors, in which bargaining power is a key factor, though in turn also influenced by many variables. In parecon, it is a cooperative negotiation of inputs and outputs that finally yields relative valuations – prices.
In central planning the prices arrived at will reflect the will of planners, mainly, though off set by other constituencies and of course having to account for certain real constraints, and the process is top down, breeding authoritarianism and class division. In markets the prices reflect largely bargaining power, and the process again yields class division. In participatory planning the prices reflect a summary of true personal, social and ecological costs and benefits and the process is consistent with classlessness.
If the above summary makes you feel like this would be, if true, really valuable and important – and you are interested in the mechanics so you can judge for yourself – then you should read a full presentation.May 10, 2014 at 6:22 pm #722708
I haven’t read all of Life After Capitalism (though, what I have read, I enjoyed). But I’ve read the Q/A and the Parecon/Capitalism comparison, several times. I haven’t found an answer to my question in those sources though, which is why I asked it.
I suppose my question, in essence, was: is what I posted a good way of explaining how materials in production might come upon their prices? Assuming that labor hours are a metric for remuneration, but also effort and sacrifice are tacked on (negotiated or what have you), plus collective decisions for ecological considerations, would that be a good way to explain the supply chain in a parecon situation?
I’m sorry if this is frustrating or you, but I’m not asking out of a place of antagonism. I’m much more of a concrete thinker and grasp ideas better if I can attach them to concrete concepts as I proposed. And, though I understand that thinking about visions for a future society rely quite a bit on abstractions, I try to tie these abstractions to concrete (as in, things we currently deal with now) as much as I can.
If there are any places or articles that have been written or put out that answer this question (which, it’s completely possible that I’m reading through this material and just being oblivious), then could you provide a link, page or chapter number? So as to save you the trouble of having to write it all out again.May 10, 2014 at 7:06 pm #722709
Sorry my last message said it was from admin – I wear both hats and sometimes, whipping through tasks, I forget to change…
As far as where to look – the book parecon, or robin hahnel has a couple of books, then there are older ones – the princeton univ pol econ of parecon book, and the sep book… in all cases, it would be chapters on participatory planning. This stuff is all over…not hard to find.
Labor hours, honestly, is mere rhetoric, most often, when all is said and done. You can measure in terms of anything – ears of corn, pounds of potatoes, particular automobiles… pretty much just like you can use meters or inches for height – think of it this way. Imagine an allocation system has settled on prices for everything, in dollars. So we decide, well, let’s see what the prices are in terms of labor hours – average labor hours, or average potatoes. Well, if an average labor hour was $20 in this allocation system, then everything is one twentieth of what it was in dollars, now in labor hours. But that doesn’t mean that something that was a dollar has three minutes of embodied labor, it would instead mean it is simply valued the same as twenty minutes of labor.
The point of using labor hours is to say – wrongly – that you can just count them up, as you were doing, to get prices. But that is wrong – horribly wrong in capitalism because bargaining power is very much at play – much less wrong in parecon – because (a) labor hours are far from uniform in how they are remunerated due to variations in effort and conditions, so you would have to be counting up average ones but you wouldn’t know what an average one is until you had a full plan, and b) values are not equal to total embodied labor hours even though you can write them in terms of labor hours, like doing so in terms of potatoes, in any event and c) embodied hours just don’t measure value accurately. Take a surgeon working an hour on a brain. Is it one hour of value – is it one hour plus, what, some tiny fraction of the accumulated time in all the surgical equipment, in all the training, etc. etc. In some economic contexts, and ironically not capitalism, you can make a kind of a case after the fact – but you can never count up from scratch to get a total. Some things have value for other reasons than congealed effort and/or depreciation of equipment, and the like – such as scarcity, the impact, and so on, then literally embodied labor hours.
Take watching lebron james play basketball. It is nonsense to say its value to the population is the number of hours james does it. Thus, for a game, about as much value as the same three hours spent picking oranges – even if we include in by some magical means a count of the hours in the stadium, electricity in the lights, the tvs, etc. etc. People value watching – a lot. His labor hours are worth more to society than mine – simple fact. Or, the embodied labor hours of james playing varies only minimally, sometimes more, sometimes less, from the embodied hours of some average player, playing. In no sensible economy would one say that james’s product is equal or less value to society, all its consumers, than some average players product. Likewise a brain surgeon’s time doing brain surgery also doesn’t tell us the value, to society, of this product relative to someone driving a rig. In parecon this doesn’t mean they get remunerated for the value of their output – but the value of the output is real.
I can’t explain at great length here – it is more or less like this.
Actors say what they want – then moderate their requests, or alter, or add, in light of what others are saying, and thus how in light of how relative values are emerging, etc., and of course also in light of their preferences, and their anticipated budget and anticipated final prices. This proceeds for many rounds, at the end of the process there are prices for everything, everyone knows their income, and people have indicated what they want, and producers what they will provide, with all of it matching up sensibly. The prices emerge from the process – a general overall result of many factors – not from counting up just hours of labor, or anything else.
That last phrase is true of any allocation system – some simple – the bosses/planners set the price though having to take into account technologies, avoiding rebellions, etc., some less so – owners dictate and or actors compete with differing bargaining power in ways such that prices emerge, or actors cooperatively negotiate and prices emerge.
Again, to see the whole thing the best bet is to read about it…
I suspect you want, an answer that matches your expectation of the importance and even the centrality above all else of labor hours. That isn’t an answer I would ever give, or parecon would ever give – because it would mislead most people and in any event, ultimately be barely more instructive than saying that prices are a measure of congealed potatoes…May 10, 2014 at 7:53 pm #722710
Well, no, I wasn’t expecting an answer that matches a system where the centrality of value is labor. I don’t agree with how you view it within a capitalist economy, but that’s not here or there, since the subject is — for me, anyway — parecon exclusively. I don’t have an issue with making subjective use-value above all else in a parecon framework. I was just unsure how concepts like money fit in with it. Again, I wasn’t being (or trying to be anyway) antagonistic.
Thanks for your answer. I’ll check out the other books you recommended.May 10, 2014 at 8:11 pm #722711
Money confuses people quite a bit – mainly because in capitalism money is also capital and of course, how you get it is so perverse…
In a parecon money is just a convenience and everyone gets it – basically, claims on a part of the social product fairly and the same way as everyone else.
Suppose a thousand people are on an island. They set up a kind of town – with no rescue in site. Everyone agrees things should be done in a fair and equitable way. After all they have to generate food, housing, schools for kids, ways to travel, some things to enjoy and so on. There is onerous work. Time consuming work. But there are benefits to be had. The apportionment ought to be just.
Someone then says, moneybags who got stranded with the rest, let’s have 100 of us, including me or of course, own everything and the rest can work for them – and the nearly all say, get serious, that is ridiculous. Then someone says, okay, let’s produce and generate a social product. And then we can each get back from it a collection of stuff equal in worth, by everyone’s estimate, to what we each put into it. This means those who have better tools, or who happen to be producing things that are more valued, or who have some great talent, or training, that most people enjoy, etc., get way more of the social product. And again, people, say, no way. And so it is decided that we should get back in proportion to the effort we expend contributing usefully to the whole social product. Thus for the duration, intensity, and onerousness of socially valued work. Okay, that is pareconish.
But now, how do you do it – that is, how do you keep track of what is fair – how do you know how much people would rather have more houses, or better houses, or a big ball field, or more food, or some difficult to make telescopes, and so on. What things do we want to produce, and how much should they count for against our budgets? Well, you have to have a way to see what the 1000 people want, and how much they want it. And then you have to have a way to have them each get their fair share, given their outlay of effort. I should not get a ton, while I spend all day swimming and joking with friends…and so on.
All that money is, in that island, and far more importantly also prices and budgets, is a tool we use to facilitate the outcomes we want. It is really about communication and decision making. Yes, with just a thousand people I suppose one could argue that it may not be needed, but make it 50,000 people and have lots of products rather than only a few, and lots of possible avenues for investment to improve and alter outcomes, and it starts to be very very useful.
My favorite bard said “Money doesn’t talk, it swears” and in capitalism that is not just poetic but instructive. But not in parecon. Where the cursing part of money is simply not an aspect of possibility…only the facilitating aspect of it…May 11, 2014 at 5:14 am #722722
I thought I might add something to something I wrote you a while back Michael. This was the original message and your response.
“After the final plan has been reached, via the iteration process, the social consumption pie has been determined for a year. Divided by 52, a 25 hour work week for every constituent say, has been agreed upon. That’s how long per week we all must work to produce what everyone wants. My weekly income is effectively a 25 hour work week or to put it another way, the total yearly social consumption pie (which has a numerical figure according to the relative prices of the goods and services) divided by the total population, divided by 52. How I spend that income has been determined by my own consumption plan minus the collective consumption (of all the respective councils) that has been agreed upon and divided up among the constituents benefiting form those goods and services or investments, some of which may be long term.
So “borrowing” is merely someone who has had an above average consumption plan (agreed upon by one’s neighborhood council), which means they would have to work harder or longer or consume less in the future to “pay” it off.
How much someone can borrow is determined via self-managed decision making processes within consumer and workplace councils taking in to consideration the effects the extra consumption and the possible extra work (they may decide to consume less) would have on other constituents.
Is the above kind of right?”
“Yes, it is kind of right, and then some – which is to say, quite right. But note, how much people work – how long – is a personal choice – as long as it can be accommodated in their workplace”
So I just wanted to clarify something.
If someone wanted to only work 10 hours and it could be accommodated by their workplace, would their income be, in light of my scenario above, 10/25 or 2/5 of the average income and could easily be determined on an hourly rate? This is assuming workplace analysis is accurate in determining the amount of time it takes to produce whatever it is they are producing, given the required average effort and sacrifice? Could the average hourly rate be determined by dividing the total consumption pie, given a numerical figure by adding up the prices, by the appropriate figure of hours in a year? (I’m not an economist nor a mathematician nor particularly good at this stuff). Then depending on whether someone works with more or less effort, adjustments in weekly remuneration can be made? Given their effort and sacrifice is acceptable they can only consume up to those ten hours a week, unless they decide to go into debt or save?
Or alternatively, am I asking stupid questions? It’s just that this whole area has really bugged me for some reason!
What if someone forgot to put in a consumption request, or decided they couldn’t be bothered but still worked the average? I’m assuming there wouldn’t be many in this group and “slack” could accommodate it but would they get some sort of slap across the knuckles like not putting in a tax return? Is this within the area of polity rather than economics?
Too many questions, yeah, I know. In the somewhat altered words of Ned Kelly, the Australian bushranger, before he was executed, “such is [my head]”! He said “life”.May 11, 2014 at 6:55 am #722723
So, I’ve looked through quite a bit of material. I ordered one of Hahnel’s books so maybe this will be answered in it, but I am still having issues with prices during the production process. Is this an issue that even exists in parecon? Assuming, since people are getting paid, there is some money being exchanged for the materials of production also, right? The only thing I see regarding prices is the resulting output of the iteration plans. It’s just difficult for me to see at that point how prices would only be considered at the output point.May 11, 2014 at 1:48 pm #722745
Yes, you are correct as to what borrowing is.
And yes, if I decide to work, say, half the average number of hours, and my workplaces can accommodate that desire – perhaps easily because some others want to work more, or less easily over time by other alternations – then, yes, I can do so and have half the income/budget for consumption. I may prefer that, valuing leisure more than others in society, and/or consumption less than others.
I don’t understand not putting in a consumption rquest – it would be sort of like not shopping – okay, who is going to do that?May 11, 2014 at 1:52 pm #722746
Is what an issue that exists in parecon? Prices exist, budgets exist. They arise from the planning process, not like in markets or central planning. They exist in context of equitable distribution and self management, etc.
I have no idea what you are asking – prices bear on all transactions, they are not confined to final goods – as you seem to be thinking.May 11, 2014 at 2:06 pm #722747
Thanks Michael. Yeah, sometimes one asks questions without really thinking it through!May 11, 2014 at 2:18 pm #722748
I am largely convinced that the hardest part of comprehension, and even of creation, is very rarely the complexity of ideas, the actual difficulty of the intellectual task. The reason is, if something is really highly complex, it is pretty much impossible to understand or be creative about, or requires years – and thus people aren’t typically doing that.
Instead, the hardest part of comprehending some set of ideas of beliefs, or even generating new ones, is most often, in most situations, for most topics that people care about and can conceivably understand or be creative about – simply doing it. That is, the hardest part is stopping to think and doing so, for the time required – and, as well, doing so without being saddled by past beliefs and habits.May 11, 2014 at 2:38 pm #722749
I’m thinking you may be largely correct. My own experience seems to suggest so as well. It may also be that when some see the words ‘supply and demand’, they also see ‘market’ or when they see ‘remuneration’ they see ‘wages’ in a demeaning market based sense, decoupling remuneration from effort and sacrifice, correlated with a production/consumption plan.
May 11, 2014 at 3:09 pm #722751
- This reply was modified 8 years, 4 months ago by James.
That is what I mean by being saddled by prior expectations and views. I am quite sure the hardest thing about thinking about, in particular, what we want – vision – for a new society, is being able to do it without succumbing to taking as given features of the old society that need to change. So, one starts thinking, say, about new relations – and then evaluates them or worries about them, in context of old ones, instead of realizing that they need other new ones, too.
The way that exchange, prices, budgets, allocations, remuneration all are tied virtually inextricably, for most people, to the capitalist ways of doing each – as if it was a kind of law of nature that one can’t alter these, is obviously a major problem for social change, but highly serviceable to capital. This is why the word market, say, means to most people, a place to get stuff. And of course it is why schooling and media do nothing to upset this particular element of system preservation.May 11, 2014 at 3:49 pm #722752
I’m having trouble seeing how prices and cost come about in the production process. Do they have any bearing on the final price of goods, or is it simply about consumer councils deciding they want x of something and the worker’s council negotiating to produce x-something, and then the materials are allocated to the workers to produce these things and the workers are thus remunerated for their effort/sacrifice in producing the goods? I’m asking about the allocation, prices and what not within the production process and how it works, rather than allocation in consumption, which I understand, or at least, I think I do.
Maybe this is because my thinking is still saddled to the capitalist way of doing things, but I don’t think so. I understand that, at the end, things are valued socially, once distribution of the final goods come about. But what I’m asking you to do is to help me visualize this process. I’ve been going through the FAQs, articles, the parts relevant in the Princeton book — again, I’ve just ordered one of Hahnel’s books, so that may clear it up — but I cannot find an answer to this issue that I’m having.May 11, 2014 at 4:55 pm #722753
There is no difference between an item that is used in production, let’s say steel that arrives from another producer, and then used to produce bicycles…and bicycles…the prices of all items arises from the process of settling on all inputs and outputs.
Or, you can think of it this way…all consumption also produces…sometimes waste, hopefully always changes in fulfillment of the consumer, etc.
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