Interrogating Participatory Economics

1. Parecon’s organization of allocation takes place on a participatory level. Does this not mean that when developing a complex product it will take a very long time for it to go through all the stages of its development from its conception to its realization? Should this in turn not be done in a centralized manner, so as to make it easier to see whether the product is attractive to the consumer on a national/global scale?

Participatory planning, which is basically the cooperative negotiation of what and how much to produce and consume (rather than their competitive or authoritative imposition), doesn’t mean it will take unduly long to pursue innovations.

Consider two kinds of new product – one that, currently, would be developed by a private firm such as the watch that Apple just released, or one that is developed instead by government support and research, such as the internet writ large, or computers in the first place, and so on. Currently, by the way, the latter approach is more important to large scale innovation.

For the single firm or industry case, if the firm is operating in a parecon instead of in capitalism, it has balanced job complexes, equitable remuneration, and self managed council based decision making, and it engages with the economy by way of participatory planning. So, in a parecon, suppose Joe works for a firm and has an idea for a complex new product. Joe proposes his idea to his workmates, and it resonates. They go to the division of the firm, or if need be, of the larger industry, that is concerned with research and design and present their idea. Again, let’s say the idea resonates. So the responsible R&D workers, whether the idea came from the base of all workers – starting with Joe – or perhaps came from someone working specifically on research and design, begin to explore the possibilities.

The R&D division has a certain budget which has been deemed by the planning process a socially desirable amount to allocate for innovative research and development. The people working in the division decide how to apply the funds and their own time to examining and testing and perhaps even prototyping Joe’s idea. Lets next assume the relevant people explore and decide, yes, they determine that this in their view is a really good idea that we should pursue. Assuming it wasn’t in the normal order of stuff they can simply act on, they would then propose the endeavor to the firm, and if the assembly also decided it was a go, the firm would  seek any additional inputs needed and proceed. The firm, which already has a budget for research and design might be able to proceed as is, within that budget, or, the idea could exceed the budget and in that case the firm would need to get allocation suitable, via refined planning including some interim alteration of plans.

The essential difference from now is nothing technical, and not about the duration of the process, which is largely set by technical limits and options and in that limited sense is actually rather similar to now. The difference is instead that in the parecon case the entire process occurs in context of the need to convince division mates, then firm mates, then perhaps industry mates, and then an audience from the broad public of the merits of the pursuit. This replaces trying to convince authorities in the firm, bankers, the media, and then the public that has disposable income. The overarching context, even more important, is that in parecon the criteria of persuasion, so to speak, is the benefits for those who will utilize the results or bear the burdens of associated work as compared to in the capitalist version where when trying to convince firm authorities to allot income or to convince a bank to risk a loan, the criteria is prospects for profits.

Getting beyond one firm, when you think about really large scale product development, things are different because so many people and institutions are involved for long periods of costly research and development that often requires really large up front outlays. Currently the government is the main actor in such endeavors – think of the Manhattan project as the archetype case, or the transit system, or, say, the early development and deployment of what has become the internet which was only later privatized, and so on.

In a parecon, there can and I assume would be separate firms and research institutes that undertake such work (sort of like Bell Labs or Darpa in the capitalist case) and they would have budgets due to participatory planning, just like any other economic unit, but there might also be governmental units like the CDC now, say, or NASA and so on. Basically, the issue is, what does society want to allot for innovation, even realizing that an endeavor may or may not succeed? Instead of a government that is bought and paid for by the rich overseeing that determination, it would be, again, the workforces and broad public making the decision subject to constraints imposed by the collective, cooperative, planning process and in some cases also political process, and of course in light of the best available research.

Would any of this add time to a parecon version of a new product as compared to a capitalistic version of the same product? I doubt it, but let’s say it would in some or even in all cases. So? That would mean that we were adding in some extra time because we wanted to ensure self management, classlessness, etc., plus to ensure that the choice take into account personal, social, and ecological implications, and be guided not by the profit of the few but the well being of all. In these respects concerns that a parecon approach might take a bit longer than a capitalistic approach to some pursuit resemble saying democracy might take longer than dictatorship, not only in ignoring the intrinsic benefits of participation per se, but also in ignoring that just like dictatorship doesn’t, in fact, pursue the same projects as democracy, likewise capitalist allocation doesn’t pursue the same outcomes as participatory allocation.

 2. You mention that in the case of disparities between different businesses in terms of their productivity, those of sub-par productivity are urged to either increase their efficiency or their input, because if they fail to achieve this they will be closed. In the Parecon an increase of input normally goes hand in hand with an increase in wages, except in this particular case. In doing this you are taking the business’ liberty and externally demanding it to change its mode of production. Would this not contradict the values of the Parecon and cause competition between businesses?

I am not sure what you have read, that you are extrapolating from, but what you are asking is, I think, based on inaccurate assumptions about parecon.

If a parecon firm is utilizing some combination of resources, equipment, and human effort to produce outputs that are not wanted, or that are wanted but not wanted enough to warrant the costs, then, yes, that firm has to either change its product or produce enough – given the inputs – for the ensuing benefits to warrant the outlays since otherwise it is a socially counterproductive endeavor and the planning process will stop allotting it inputs and stop ratifying the budget for income to its workers. Thus such a firm will have to retool or close in which case the workers will have to do socially productive work in some other venue. And this is as it should be. It makes no sense to have a firm use energy, labor, resources, intermediate goods, spew pollution, and so on – producing something that people do not want, or do not want enough to justify the debits incurred. The ability to identify and either revamp or close such firms is something markets claim to be able to do as a virtue. Their problem is, they are not assessing full and true social and personal costs and benefits for all involved – but rather whether the firm outlays are justified by profits for a few – not to mention having gigantically skewed allocations of wealth pervert public preferences and distort their weight in any assessment. A firm generating liposuction treatment for the rich will typically persist. One generating basic medical care for the poor, often won’t.

Regarding the implications of the requirement that firms do socially desired work, I don’t know what you mean by saying that an increase in input – or perhaps it is a typo and you meant in output – leads to higher income for workers in a parecon. This too is incorrect. If a firm is producing socially desired outputs in an amount that warrants the firm’s outlay for labor, resources, etc., then those working in the firm will get income for their labor – but the income they get will not be correlated to either personal or group output, but, instead, to the duration, intensity, and onerousness of their socially valued labor. Whether a workforce deserves income is affected by whether their output is socially desired and thus useful. But the income they actually get is governed not by output levels, but by duration, intensity, and onerousness of socially valued work done.

So, you are right that businesses don’t get to use lots of stuff to produce less than what its cost of inputs calls for if it is to be socially valuable. It might help to think of one worker to understand it.

Suppose Sam decides to dig holes and fill them. He uses big backhoes, or whatever they are called, to do it. He may work really long hours, really effectively, and the conditions may be onerous. But the effort is not socially useful since, in this extreme case, there is simply no output for anyone to benefit from. Sam cannot claim income, much less high income, based on his effort, because his effort is not generating socially valued output. That should be uncontroversial. The implication is that if Sam wants income from labor then Sam has to reconsider and do some warranted work.

Well, the logic is the same for a whole workplace. It is only socially valued labor that is remunerated and, indeed, the planning process would not allot backhoes to Sam, nor would it allot lots of resources or tools or workers to a firm that the planning process found to be not delivering socially useful outputs. And for a firm, the implication of that, again, is it needs to retool or refocus, or disband if that is wisest. But this is not some backdoor introduction of competitive dynamics including seeking to win higher incomes, or to accumulate wealth, or anything else. Nor do its workers suffer due to the changes that make some firm’s product no longer worth producing.

3. One of your premises is that each person can roughly estimate their consumption for one planning period. Do you not think that you are disregarding human spontaneity? Reserves and flexible updating can probably not compensate entirely for the spontaneous developments of demand. How would you handle this problem?

That minds change is not a problem of parecon, but of any economy at all. If we cannot, in some particular case, plan in advanced for fluctuations, which, by the way, under capitalism, must be done all the time, though often horribly badly, so that, for example, in the U.S. a huge percentage of food goes to waste, then when the information that we were off in our plan becomes known, we must simply make adjustments. The same thing has to occur now, the difference is that now adjustments happen due to new preferences only when meeting those changed preferences instead of what previously was underway will increase the profit going to owners and preserve power relations. In a parecon, in contrast, adjustments happen when they will benefit people more than anything that must be reduced to facilitate the adjustments.

My guess is that a participatory plannings calculated reserves and its flexible updating that are both built into the process of cooperative negotiation, would be vastly better than the current market dynamics even at this specific task – avoiding gluts and shortages, even in cases where both were trying to address the same newly stated desire – much less in when determining which newly stated desires should be addressed, and to what extent – where the parecon process would obviously excel.

But, in tune with your question, let’s say something happens that can’t be quickly accommodated due to reserves and simple updating. A massive earthquake, say. The event hugely and urgently changes the desires of a very large number of people from what they had registered during planning. Now what?

Well, in a typical current corporate situation there will be some charity – largely misdirected due to driving institutional pressures. Then there will be some retooling in various industries, too, but this will be to achieve profits, not to meet needs. Hotels will not look at displaced people as citizens needing housing, but will try to amass profits by jacking up prices for the few who can afford them. Powerful forces may even exploit the disaster to hurt certain constituencies still more, if that can benefit other more powerful constituencies.

In a parecon, in contrast, we would immediately see reduced demand from the affected constituencies for all kinds of stuff that was no longer suitable, and we would have a very good idea of the new kinds of stuff needed. Partly diminishing the former to enlarge the latter would be the path followed with firms quickly beginning that reorientation for the coming periods. But let’s say that wouldn’t do it fully. Instead let’s say doing more of some things and less of others would require transfers of workers and materials, and so on. This might happen simply by political mandate conveyed to workers councils, or even by reconvening the planning process, if the events were really large scale. But it should be evident that there is nothing about participatory planning and human centered motives that makes this harder, much less less likely to be done humanely and well, than having competitive or centrally planned allocation, plus profit or even just surplus centered motives address the situation. Quite the contrary.

4. You mention that people who are more skilled in rhetoric and attend more meetings cannot in a parecon achieve any material advantages through this position of relative influence. While doing this you also mention that the urge to strive for material riches isn’t primarily linked to materialism, but much rather that it is about acknowledgment and power. Do you not think, that the more active individuals in a parecon have more power and therefore indirectly have more influence than the less active individuals, which means that their interests will be more visible and therefore acted on?

Suppose Joe is very energetic and active, and also incredibly smart and verbal – very good at coming up with good ideas and convincing others of their merit. What does he do if he wants to parlay these traits into personal gain beyond what society would otherwise allot him? He can’t use his qualities to get more income since income is a function of duration, intensity, and onerousness of socially valuable labor. He can’t argue for more, or bargain for it, or grab it, or even get it for having more good ideas. He also can’t use his qualities to get better work conditions because jobs are balanced. He can perhaps get one balanced job instead of another due to being better at convincing workmates, but that isn’t amassing excessive advantage. He can also use his qualities to try to convince folks of views he favors. If he does that, and he succeeds, and the new ideas that he advocated prove beneficial, he will likely gain respect, maybe various kinds of stature, etc. But again, he cannot amass material or social advantage.

The point is, Joe’s options is to use his talents in the social context that he inhabits which means in accord with society’s structures and roles. He can’t gain beyond what the society’s values favor. And if he benefits in the form of adulation or stature, it will reflect that there is benefit for many.

In any society you can say what if so and so behaves poorly or even abominably? The question to ask about such possibilities is why would people behave badly or abominably? What would they gain? And even more important, would making unwarranted gains snowball into conditions yielding their doing it more, or yielding more people doing it? Parecon, its advocates would maintain, yields desirable results on all these counts, compared to other systems. The reason equitable apportionment of social product and fair allocation of conditions minimizes the benefits of violations.

Take one example. Suppose Joe steals. Maybe he just takes stuff. Or maybe he figures out some hyper smart technique that funnels stuff to himself – though I would be curious what this might be. And let’s assume Joe doesn’t get caught. What does Joe do with his bounty? He can’t make it visible because there is no legitimate way for anyone to amass seriously disproportionate wealth so that publicly displaying such wealth would be a sign saying, I stole. So if Joe undertakes such abominable behavior despite his having a socially fair income from his normal work, he risks getting caught in order to enjoy benefits in his basement but not in public. I suspect we won’t need much of a police process to deal with stealing – a little maybe, but not much.

And the same goes for a more subtle worry, black market activity. Let’s say Joe is the world’s best tennis player. He decides to exploit his talent to get higher than socially warranted income. He will give lessons or just play with people for lots of pay. But problems arise, where will he play with them, on what courts? How will he get the planning process to abet his subterfuge? And if he finds some way to do it, what does he get paid with? It will have to be stuff – items that others have bought and give him, like gifts, except in exchange for the lessons or games. What does he then do with all that bounty – again, into the basement it must go, lest everyone knows what he is up to.

Honestly, all this is of some interest on the road to enacting a good economy, but not too very much, because even if the answers parecon had were much weaker than they are, the response ought to be, okay, then let’s experiment and we can fix any ills as we learn more about them. After all, the worst results any of these worries would imply – even if we ignored my replies – wouldn’t even remotely approach the levels of graft, fraud, waste, and shortage that are endemic in market economies, not to mention that even when these illegal ills aren’t present, the actual business as usual apportionment of outputs in market economies can quite reasonably be called graft and fraud itself.

5. The organization of balanced job complexes is very complex as there are many different companies each with thousands of different tasks. These pieces of information would have to be brought into society so that fair balanced job complexes could even begin to exist. Doing this requires a lot of effort and the idea that everyone would join in this effort conscientiously seems improbable to me. How would you approach this problem?

Parecon is a social system, not a bridge. Outcomes are fluid, necessarily constantly updated, and never perfect. Similarly, the idea that everyone must be involved in every assessment and decision is of course unviable.

What I mean by parecon not being a bridge is that balanced job complexes aren’t something one engineers to a fine degree, like the fittings of parts of a watch or a bridge, say. They are instead something that continually adapts and alters. Balanced job complexes are first created inside firms by way of the workers there simply convening and reapportioning the firm’s tasks and responsibilities as best they can – including incorporating and undertaking relevant training. This is those workers purview and there is no need for everyone in society to know about all the tasks in the firm and how they are mixed and matched into balanced job complexes. Later, when complexes exist and stabilize inside firms, they would be periodically refined due to workplace changes, perhaps yearly, or whatever was sensible.

The more difficult issue of balancing between workplaces wouldn’t be very different. At first this would address the most egregious societal differences such as workplaces where the work was overwhelmingly without empowering aspects compared to workplaces where the work had only empowering aspects. The balancing would occur in two ways: 1) technical innovations to improve the average job quality in below average settings, and, 2) the people in below average settings working shorter hours there, and taking up that slack in other kinds of more empowering labor, likely in their communities, for example.

To transition from the horrible allocations, motives, and related tructures that we now endure to preferred equitable and self managed relations with balanced job complexes and equitable remuneration will not occur overnight. Nor will it occur without confusions, errors, corrections, and so on. Nor will it ever attain perfection, whatever that might mean. However, to not travel this type of path will be suicidal whereas to do so will lead to a truly worthy economy where equitable classlessness is attained.

6. Assuming that a person is performing a task rated as having a difficulty of 4, and the overall average, however, lies at 7, said person would have to perform a task with a difficulty of 10 in order to reach the average. How does one respond if said person is not capable of performing the higher difficulty task? What about if said person is simply not interested in doing another job?

First, and this might just be a poorly chosen word, “difficulty” is not the issue. Empowerment effect is the issue. The reality is disempowering work is typically far more difficult – in the sense of debilitating and exhausting – than empowering work. You perhaps meant empowerment, so the question put relevantly to parecon becomes, take Joe who has been doing rote and repetitive labor. His moving to having a balanced job complex might entail his still doing some of that rote activity, but it will also entail doing other empowering tasks. What if Joe simply cannot do empowering tasks, or doesn’t want to?

Well the first concern is overwhelmingly unreal. Being able to do some empowering work doesn’t mean being able to do one explicit empowering thing – say, surgery. It means, from a vast array of empowering tasks, being able to do those that suit one. To say people who haven’t done empowering work can’t to empowering work, is, honestly, classist in precisely the same sense as in the past saying women who haven’t done x, or blacks, who haven’t, can’t. The deduction mistakes a human group’s condition that is caused by social relations for, itself, a natural given that in turn causes the relations.

Still, some folks, you might reply, won’t be suited for any empowering tasks. If so, and I suspect this will only be true for people who can’t work at all, then they will do what they are suited to do. This is a small scale issue, medical, really, and treated without implication for the larger social relations.

And you may now add, what about the person who could do empowering work, but doesn’t want to. This is a serious question, I think, especially for transition during which the sentiment may initially be pretty widespread, mostly due to mistrust and insecurity. So, a movement spreads and makes progress, and tries to interest workers in some firm in balancing job complexes their. Many resist. They say it will disrupt their habits and patterns, but also acknowledge that they just don’t believe it. They think it is scam to induce more intense work levels.

That is a very real issue, and simply part of the many problems that have to be overcome on the road to a very widespread movement for fundamental change.

Still, you say, what of the person who balks out of honest personal preference. Let me tell you a little story that embodies my inclinations about this. I was part of a publishing project called South End Press quite some time back. It was organized with balanced job complexes even though operating, of course, within a market context that continually pressed against the innovative features. One day, one employee (of I think about eight employees at the time) said, hey, I want to change my job. I want to do only rote work, clean bathrooms, take the mail, type manuscripts. I don’t want any of the responsible and empowering tasks, editorial, finance, and so on. They stress me out. This means the rest of you get a little more of the empowering work that I would have done, and I get a little more rote work, that you would have done. It is my life, it is my preference, it doesn’t hurt you, so let’s do it.

We thought about this for awhile. It took everyone by surprise. The final verdict was no, if you want to work at South End Press you have to do a balanced job complex. And he actually decided, no, he would leave, and he did. What was the logic of the decision? The rest of us said we do not want to work in an environment where you are doing only disempowering work and, as a result, we are dominant over you. We are not telling you what you should enjoy, we are telling you the kind of workplace we want, and, writ larger, the kind of economy. We are happy and even eager to help you overcome any fears or trauma or excessive pressures you feel doing more empowering tasks, but we are not okay with you doing only disempowering tasks.

Well, the same applies to a whole society/economy, except it becomes simpler. Not only do people have relevant training and skills from their upbringing and schooling, and including expecting to have a balanced job complex, but, it is the only option since all jobs are balanced.

7. You completely reject the market. Why can’t you conceive a market which follows ethical guidelines? There are suggestions within market economy to redefine general welfare as the primary goal of economic activity rather than financial success. One of these suggestions can briefly be summed up as follows: Each business creates a welfare balance sheet, which rates the activities of the business according to ethical values such as human dignity, solidarity, justice, ecological sustainability and company democracy. If the business has a bad welfare balance it has to face economic sanctions. The welfare balance has more importance than the financial balance. Do you not see any possibility to impose ethical incentives within the market in order to restrain it?

Suppose someone said to you, you completely reject dictatorship. Why can’t you conceive a dictatorship which follows ethical guidelines? I would imagine your answer would be, I can’t because the dynamics, pressures, and implications of the relationships that constitute dictatorship work so aggressively against such an outcome. It doesn’t mean I can’t conceive of a worse or better dictatorship, or of a dictatorship in a society that somehow has developed some counter balancing pressures that diminish dictatorship’s worst effects, though I would know that those counter balancing efforts would be constantly in danger of disappearing. But it does mean I don’t want dictatorship, even if I prefer a better to a worse one, and if I prefer having counter balancing pressures, however unstable, to not having them.

The logic of my view of markets is similar. A market is a particular kind of allocation institution in which separate producers and consumers compete to get ahead. Without going into detail, market dynamics intrinsically violate sociality and produce the worst kinds of individualism. They misprice virtually all inputs and outputs and most particularly those with effects that extend beyond the direct buyer and or seller. They routinely and intrinsically violate ecological sanity, and they even create class division (coordinator/worker) even when private ownership is eliminated. There is more, but that is more than enough to make me anti-market. Of course it is possible to have laws and other counter balancing pressures, and to have them is better than not. In fact, you could almost say that extending that corrective logic to its fullest, that is, taking each horrible or suicidal or just humanly deprecating and denigrating aspect of market allocation and steadily making changes or imposing constraints to remove the ill and replace it with good, would lead to participatory planning. Such reforms, therefore with that goal guiding how they are conceived and implemented, are to me very worthy endeavors.

But taking markets and saying they should operate such that every business, and presumably every consumer as well operates in light of social and ecological welfare is no different than saying a dictatorship should do so. The institutional structure is contrary to and works against the desire, arguably even more so with markets than dictatorship, I tend to think, because the suggested behavior actually undercuts the ability of markets to operate at all.

Some people use the word market to literally mean exchange or  allocation. In that case, your injunction that the market – now meaning exchange/allocation – should occur according to criteria of social and economic benefit is precisely the injunction that guides the definition of participatory planning and the rest of parecon as well. But to talk about an allocation system stripped of competing for self advance, stripped of authoritarian imposition, conveying full information about ecological and social implications, and conveying appropriate influence to all actors, simply is not talking about a market, anymore, but about desirable allocation.


  1. avatar
    Michael Albert October 15, 2015 2:11 pm 

    What makes something worth having is not that it is on the horizon, of course, but that it is worth having – elementary, but true.

    What makes something meaningful about social relations possible, or even imminent, is not a new technology, but ultimately people seeking it in sufficient numbers and with sufficient commitment and means. Also elementary, but also true.

    History can travel many paths. Nothing much is pre inscribed – in any meaningful sense. Parecon is not imminent or inevitable, but it is possible – just like, once, an end to slavery wasn’t imminent or inevitable, but was possible. And so on.

    There is no point, honestly, in hoping for cracks in history to open up of their own accord and dump us someplace better….that posture is one of observing while others are busy subverting. There is a point in acting, pursuing, trying, however.

    Waiting for forces of production to burst relations of production and usher in change, is, in my view, the real fool’s errand, honestly, on so many grounds… Acting to try to create sufficient support for change, and sufficient means of marshaling that support, to win changes and eventually a new system is, in contrast, sensible – but without guarantees.

  2. CJS October 15, 2015 11:57 am 

    There is an old Marxian chestnut about the productive forces outgrowing and exploding social relations. Chestnut perhaps but it describes compellingly so much that has happened over the past century, both revolutions and their undoing. It also unlocks the climate crisis we face in a new way (especially if we consider the biosphere as the ultimate productive force). Anyway I will get to the point. I wonder, how is Parecon not simply ethically or philosophically better than capitalism in some ideal sense but actually historically imminent? Where are the latencies building? In what sense is something like Parecon a productive, living necessity, a ‘real movement’ for all us workers here looking and hoping for those cracks in history to open up?

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