Participatory Economics

Civilized Values

A good first step in thinking about a new economy is determining our basic economic values. Here is a minimal list of values for a civilized economy, which, if attained, would have maximal implications. That is because the institutions of our envisioned participatory economy will produce outcomes in accord with the values set out below.


Self Management

All people should have a say over decisions in proportion to the degree they are affected by them. Different deliberation and voting methods may best approximate such self management in different situations.

Sometimes one person one vote majority rule can do an excellent job. Other times consensus will do better. Sometimes more deliberation, debate, and challenge will best propel self management, other times, we can do with less. Sometimes a single person should overwhelmingly decide an issue – as we decided to type this sentence. Other times a highly affected group should overwhelmingly decide, though in context of larger decisions taken by larger groups that set boundaries due to effects on them.

The guiding logic is that self management means no person deserves more say due to being male or female, gay or straight, or having a different economic position, cultural affiliation, and so on. We all deserve a proportionate say about what effects us.

The most typical criticism of favoring self management is the observation that some people will make better decisions, so why should we forego their greater insights by limiting their say?

First, this ignores that self managing say has social and personal benefits – respect for all, solidarity, participation – even in cases where it would yield less insightful choices, if such cases exist.

But, second, the complaint also ignores that each of us is the world’s foremost expert on our own preferences so that each of us expressing our personal preferences is warranted by the simple fact that we know best what we want. Crucially, this complaint also masks that nothing in self management precludes ample attention to expert insights. With self management, I decide whether I want to undergo a medical treatment, but only after a doctor tells me the need and implications. The doctor’s expertise should inform my decision, but the doctor shouldn’t decide for me. My preferences matter. Economic institutions should incorporate and facilitate self management.



What is fair regarding benefits and costs? Philosophers debate. Constituencies battle. We know society produces outputs which require effort, convey benefits, and whose production affects workers doing it. Our value question becomes, how should we apportion it all?

Suppose we tally up the benefits and debits that each person receives, both from producing and from consuming, both as individuals and socially.

Why should one person have a better mix of benefits versus debits than other people? Why shouldn’t all people have a fair share of benefits for in turn shouldering a fair share of burdens?

For economic involvement equity implies that we should each receive consumption rights to enjoy a share of the social product in accord with the duration, intensity, and onerousness of the socially valued labor we contribute to help generate it – unless, of course, we are unable to work for health reasons, in which case humanity dictates that we should get a full share, plus socially supported medical care, in any case.

This approach treats everyone the same. If you work longer, harder, or at worse conditions, you get more. If you work less long, less hard, or at better conditions, you get less.

Everyone has a mix of responsibilities to contribute to producing social benefits and in turn receives options to consume from the social product. Taken together, the total of production and consumption we do is comparably rewarding for us all. This is equity.

One might complain that inequity creates motivations to excel without which the total product will shrink. This is, however, absurd. Rational incentives do not require or even benefit from inequity. We do need incentives to work longer, harder, or at worse conditions and that is what equitable remuneration conveys, since you can receive more for precisely those reasons and no others. We do not need to get more for being genetically better endowed, or because we happen to produce something more valued, or because we happen to use better equipment, much less based on owning property. Economic institutions should generate equity.



Another value is that people should feel solidarity, not simply in families or in small (or large) tribes, but also across communities. Circumstances and options should not produce a zero sum rat race where our local or a distant neighbor’s loss becomes our gain. Instead, my well being and your well being should be intertwined so we each benefit in tandem thereby enjoying feelings of empathy and benefits of mutual aid. Who would instead prefer anti sociality as a value? Economic institutions should foster solidarity.



Also uncontroversially, another value is diversity. We should not put all our eggs in one basket. Partly we want to insure against losing our way all at once. Partly we realize that while we can each do only what we ourselves do, we can all vicariously benefit from others doing a wide range of things that we do not do. Variety is the spice of life. Who would prefer social homogeneity to diversity? Economic institutions should generate and preserve diversity.


Ecological Wisdom

As a last value, we should of course want to live in the world without defiling it and compromising further survival. Our accounting of why something is worth doing should assess implications for the environment – and thus for life – both in the present and the future. Who would favor unsustainability? An economy should not be suicidal, but sustainable.


Civilized Institutions

The values outlined above were not chosen arbitrarily. They reflect the values that have been developed over centuries by progressive social movements struggling for civil rights, social justice, gender equality, environmental stewardship and much more. If we assume the above are worthy values, pending evidence to the contrary, what institutions could make them real in people’s daily economic lives? Participatory economics claims to answer this question.


1. Worker and Consumer Councils

For each person working or consuming in an economy to be prepared to participate in decision making in proportion as he or she is affected requires a place to do that.

In workplaces, we opt for workers councils and at a lower level work teams. For issues that transcend individual workplaces, each local workplace council is part of an industry council, and the sum of industry councils is workers in a whole economy.

For consumption each person consumes as an individual, often, but also typically as part of a family, living unit, neighborhood, region, or country, including having a council for each.

The structure and logic of each council is similar. Actors at the appropriate level express preferences, deliberate, debate, and finally tally their preferences fulfilling, as well as possible, collective, cooperative, self management.


2. Balanced Life Circumstances

Next comes organizing and apportioning tasks. We want what people do to be fair as well as people doing things they are able to do well and that are worth doing. A subtle but profoundly important issue arises.

What we do affects how we feel and who we are, as well as what else we are able to do.

If we spend most of our time doing acts that convey confidence, knowledge, skills, social connections, and access to decisions, it will prepare us for being creative and initiating. In contrast, if we spend most of our time doing acts that deskill us, bore us, reduce our knowledge, isolate us, and diminish our confidence, then we will be ill prepared for creative involvement.

In the economy, if we do a few rote tasks over and over each day, when we are not at work as well as while we are on the job, we will be prepared for little more than obeying orders. On the other hand, if we do tasks that are overwhelmingly empowering, we will be prepared to take initiative and exert influence while at work and also beyond.

In the economy, suppose we call those who do mostly empowering work coordinators and we call those who do very nearly entirely disempowering work, workers. Not only will the coordinator class dominate the working class – setting agendas, determining options, etc. – but, strikingly, even most workers most will, by virtue of easily apparent data, tend to feel that the situation is appropriate. Coordinators will appear prepared, able, confident and initiating. Workers will appear unable, lacking confidence, obedient. It will appear natural that coordinators rule and workers obey, even though, in fact, such a pecking order is actually a product of contingent social relations making some people more confident and prepared and other people less confident and prepared.

What this reveals is that class differences in the economy that establish and even seem to justify harsh hierarchies, can arise not only from capitalist ownership relations, but also from the kinds of tasks we do for the greater part of our waking lives. Thus it is not only owning or not owning means of production that can relegate some people to rule and other people to obey, but also monopolizing empowering tasks or conversely doing mostly rote and obedient tasks.

In the economy, we call the solution to this class division a balanced job complex. We define jobs so everyone gets a fair share of empowering and disempowering tasks.

We must also acknowledge, however, that until we all experience classlessness on a massive scale, some will say changing the division of labor to have balanced job complexes is insane. They will say some people deserve to be doctors, lawyers, engineers, and decision makers – while others ought to be subordinate because they cannot make good decisions and will even be oppressed by being required to do so.

Of course, this recalls sexists and racists claiming the same things about women and minorities. Dominators universally claim those who they dominate are subordinate due to being inferior. They self servingly mistake the effects of oppressive structures for the cause of those structures.

In short, while some will say that having balanced job complexes violates nature, they ought to be ashamed to harbor such classist views. We can not all do everything, but certainly we can all, with rare exceptions, shoulder a fair share of creative and decision responsibilities. If we want classlessness – and who will admit to not wanting it – balanced job complexes are essential. The unbalanced alternative inexorably creates rule by those who are structurally empowered. Economic institutions should include and sustain balanced job complexes.


3. Equitable Distribution of Benefits and Debits

The value we espoused earlier, equity, when writ into institutions, entails that society apportion its responsibilities and offerings in such ways that each member gets a fair overall package.

Taking the economy, this means we should receive a claim on consumption in proportion to the duration and intensity of our socially valued work as well as accounting for the onerousness of the conditions under which we do it.

Critics of this approach will claim it would cripple output. Who would want to be a doctor, goes the refrain, if there was no large reward for doing so? But let’s examine the situation.

Would you really, other things equal, prefer to skip college, skip medical school, and skip being a doctor (or the similar choices prerequisite to some other empowering position) to go straight from high school directly into, say, a coal mine, or directly to tending a stove in McDonalds? The claim everyone parrots on behalf of inequity, implies you would. But would you in fact prefer flipping burgers to being in college so much that you would have to be paid twenty or even fifty times as much for forty years, every year, to get you to undergo the so called hardship of college and empowering work? Would you opt for entirely rote repetitive labor over some empowered role you were suited for, if the pay for being a rote worker were half (rather than a small fraction) of the pay for doing some more empowering work? What about if it was the same? What if it was more for rote work? The truth is – just ask students to see – pay the doctor a good living wage, and people wouldn’t instead do only rote work even for a whole lot higher pay than doctoring, lawyering, engineering, or whatever.

Please note, though, with the institutions we are proposing the situation doesn’t even arise. Everyone works at a balanced job, doing some empowering tasks and some more rote tasks, and receiving a fair income for the combination. The arrangement gives everyone an incentive to work capably and well, doing useful activity, for as long as needed for their well being, because duration and intensity of work is what earns income. Economic institutions should apportion rewards and costs equitably.


4. Participatory Planning and Generalized Self Management

The idea of the last institutional innovation underpinning a civilized economic setting is that the apportionment of energies, resources, and labor, and of the benefits that derive from their utilization, should be decided consistent with collective, cooperative self management, as well as in a way that gets the tasks done insightfully and in tune with people’s needs and desires.

In current real existing „capitalist“ and „socialist“ economies the allocation function occurs by way of markets or central planning. These institutions are, however, horrendously flawed tools even when there is no private ownership of productive assets. Harsh and irrational competition, authoritarianism, ecological calamity, fiscal crises, anti social personal motivations, and class division are intrinsically promoted by these institutions. Markets and central planning are utilized despite these flaws due to the benefits they convey to the most powerful and most wealthy.

For the values we have settled on new structures of allocation, like new structures of local decision making, remuneration, and division of labor, are needed. Indeed, markets and central planning would each by their operations subvert the earlier advocated institutional choices and values.

We have described having workers and consumers councils. Work happens. Consumption happens. The allocation task is that each workplace must arrive at an agenda regarding intermediate goods from other workplaces, labor, and the outputs generated for whoever wishes to receive them. Likewise, each individual consumer, neighborhood, city, county, etc. must arrive at an agenda for what it will receive that others will produce and provide.

Of course there are some requirements.

The decisions of each participating workplace and each individual consumer and collective consumer must sensibly match up to minimize shortages or left overs. Also, we certainly want choices to account for the personal, social, and ecological costs and benefits as we pursue options which are overall positive while avoiding options which are overall negative. Finally, we allocation’s requirements for our behaviors to foster values we favor and facilitate relations we desire, rather than to subvert both.

We are talking about millions of participants negotiating the distribution of vast quantities of goods and services so the above are major constraints on a massively complex problem. So now what?

The usual answer is, let’s have markets or central planning or a combination of the two. The problem is that markets and central planning in any combination mis account costs and benefits, pervert behavior, generate class division, destroy equity, violate self management.

So we propose, instead, participatory planning. Each workplace council (and by aggregation higher councils), and each individual and collective consumer, take into account last year’s actions as well as predicted changes for this year to propose their preferred activities. There is no reason to think that they will all immediately match up desirably, so each participant then takes into account the proposals of other participants and the implications of those for predicted costs and benefits, and modifies and resubmits new preferences. There will still likely be no match, but we will be closer. So this happens five or six times, with some adroit mechanisms consistent with the guiding values facilitating coming more closely into accord each time.

It is a cooperative and collaborative process. Actors massage their requests and offerings in light of their own desires and the revealed desires of others as well as the revealed social and ecological costs and benefits to society.

Details aside, the claim of participatory economics is that this planning can be done, without competition and without an authoritarian center, to arrive at a worthy plan that manifests collective self managed preferences. More, the steps involved and actions of people called for will be consistent with, manifest, and facilitate other features sought for the economy including balanced jobs, equitable remuneration, and self managing councils.


Closing Remarks on Civilised Values and Institutions

One should not read the above and say, okay, great, I like the values, I want classlessness, so I favor participatory planning and participatory economics. One should, instead think – if this claim is true, then I ought to favor this vision, and therefore I need to look into the logic and features of the claim further to decide. Meanwhile, here we can at least consider some implications.


Ending Crises

Why would attaining the above modest list of institutions – self managing councils, balanced job complexes, equitable remuneration, and participatory planning – eliminate the types of crises we are currently enduring, and many other types, as well?

The short answer is because these new institutions won’t intrinsically produce, as part of their very logic, the dreaded outcomes. Easy to say, but what about plagues, drug epidemics, rampant immigration problems, wars, and situations in which the value of one’s holdings collapse, workplaces under produce or over produce, or global warming and ecological disasters proliferate?

Having a participatory society does not preclude a disease developing and spreading. But it does ensure that assessments of how to address such problems dramatically change. Rather than the allocation of intellectual energies to medical tasks being ruled by profit potentials, they – like all decisions – will be ruled by best estimates of impacts on human well being and development. Errors will remain possible, of course, but systematic violations of health to generate profit – as we now have all over the world – will not.

Regarding health more broadly, in a civilized economy there would be no incentive to accumulate profit for the few while ignoring, blocking, and even exacerbating conditions of danger on the job, toxic environments, or the need for worthy insurance. Even more critically, there would not be debilitating poverty, horrible malnutrition, widespread starvation, etc.

Similarly, a good society removes the incentive to produce and distribute addictive drugs (or foods), by making it impossible to earn and enjoy great wealth based on such endeavors. That is, in a participatory economy income is a function of duration, intensity, and onerousness of labor undertaken via a workers council in an industry which the plan labels worthy due to popular desires for its product. Now suppose that some cartel or corporation decides to try to amass wealth via providing an addictive drug – cigarettes, diet pills, lifestyle drugs or whatever – by creating a gigantic market for it. How would people doing that earn from their actions?

First, such activity wouldn’t garner resources via the participatory planning system. But even if resourceful dealers found a way to escape that barrier and temporarily managed to amass huge revenues (actually also impossible unless each dealer was not only able to produce and distribute, but to amass income for lots of false names), how would they then enjoy their massive income? Any huge amount of consumer benefits in the hands of any individual must be a result of cheating, stealing, etc. That is, no one can work long or hard enough to legitimately amass such excessive wealth, so having really excessive wealth reveals that one is a thief.

Since penalties for illegal activities presumably exist, and since options to enjoy the fruits of illegal activities are nearly nil, and since even generating exorbitant sums in the first place is virtually impossible, and since everyone gets fair income in any event, there is zero reason to cheat, steal, push drugs, or even just try to sell as much as possible of some product for any reason other than to meet needs of users. A dealer risks debits as severe as society chooses to impose, and can’t enjoy massive benefits due to dealing drugs in any event – other than by hiding away the gains in his or her basement since a civilized society lacks massive differences in income, so that visible grossly excessive consumption is a billboard saying, I cheated.

Potential immigration problems could persist until equitable relations were international – at which time there would be no reason for mass migrations. This gives each participatory society very good reason to help spread participatory structures broadly. Consider trade. It ought to occur in a manner that benefits weaker and poorer parties more than richer ones, so as to reduce gaps in wealth, rather than benefiting powerful and richer parties more, thereby increasing gaps in wealth, as now. This positive result is not intrinsic to the new institutions existing in one country but depends instead on future policy choices among countries. On the other hand, populations would function in environments without antisocial pressures, emphasizing solidarity, and enjoying security, so it is reasonable to predict they would favor positive policies.

Wars over oil or tungsten, or for imperial sway over trade routes, or to ratify or protect corporations, or to bolster political elites, or to punish populations, would disappear because these causative dynamics would themselves disappear, at least, as with immigration, once new institutions are international.

Typically, war, and even colonialism, is not about benefitting whole populations at the expense of other whole populations. Instead it is elites in one country who promote war at the expense of the population of their own country, and, as a kind of gigantic collateral damage, the population of other countries as well.

The idea is simple. Suppose Britain colonizes India. It steals wealth, oppresses the population, etc. So, the population of India certainly suffers. But who gains? Britain? Not so fast. Britain is an abstraction.

What is taken from India goes overwhelmingly to corporate elites in London. The bill for this extraction is, however, paid by the British population, via their taxes, and of course by the Indian population. This can even mean that for every $2 depleted from Britain in costs of maintaining empire, only $1 comes back in ripped off profits. And yet empire would persist. Why? Because the population pays the $2 and the corporate elites collect the $1. It turns out war not only rips off others, it redistributes wealth at home.

Now consider wars like in Indochina, undertaken to preserve empire from a “bad example” (that is, from a country choosing to extricate from oppressive relations), or wars in the Mideast, undertaken to control oil as a bargaining chip in international relations, and so on. Who pays? Everyone in the targeted country, and, as well, everyone in the host country paying taxes to support the costs. Who benefits, elites in the host country – materially and politically, and some quislings, often, in the assaulted country too.

Now why does all this disappear as we attain civilized relations? Because in a worthy society and economy, there are no such elites to benefit in the attacked or attacking countries, and because the populations of each, well informed and capable, would never sanction such sadistic aggrandizement by and for a few. In a classless economy there is neither an institutional push toward war, nor is there a compliant population that would accept it.

What about what people usually mean by crises, that is, economic dislocations? If productive units over produce so that there is great waste that is simply thrown out – which is an endemic condition of contemporary economies without even taking account of useless war production, duplication, etc. – that is a crisis for resources and labor allocation – and ecology. It becomes a crisis for elites only if it hurts profit possibilities.

If productive units underproduce, so there are shortages, and do so in a runaway pattern so that too little consumption causes cuts in production, which causes further cuts in consumer income, which yields still less consumption, then it is crisis as well, certainly for the population and also for elites, when, again, it grows to hurt profit possibilities.

A civilized economy would avoid all this by correlating output and consumption closely, and doing so not to aggrandize a few, or to abide orders given by a few, but to equitably address everyone’s needs in light of the self managing preferences of everyone. But this is participatory planning plus equitable remuneration and balanced job complexes, and with these institutions there is simply no motivation to do other than fulfill the agreed scenarios of society’s plans as best as units can. There is no way for individuals or groups to make higher income or otherwise gain by producing less or more than desirable. There is also no way to make higher income by inducing consumption through false advertising or other deception, since such consumption wouldn’t actually meet needs and would not increase incomes.

Similarly, in a civilized economy, any project that destabilizes ecology makes no sense. There may be benefits for some, as with continuing to use oil, now, say, but there will also be offsetting harm for many, perhaps immediately, or certainly in time, as with global warming threatening millions if not tens or hundreds of millions of people – and perhaps more.

If the economy’s allocation system (as with markets or central planning) seeks to benefit only some, or has a short time horizon, or doesn’t account for the ecology in its weighing of factors, then horrible violations will occur, as we witness in current societies. But if an allocation system properly assesses the ecological as well as social and personal implications of choices, and then it weighs the impact on everyone, and chooses actions consistent with people’s wills in light of carefully conveyed information and proportionate decision inputs for everyone, then these violations will disappear. Informed and confident populations will never agree to policies enriching a few while hurting the many.

When all is said, however, the real virtue of a participatory economy and participatory society isn’t in eliminating current tendencies toward crises, as important as that is, it is in eliminating the business as usual condition of permanent crisis that currently average daily levels of inequality, authoritarianism, alienation, ecological dissolutoin, etc. The virtue is attaining self management, equity, solidarity, diversity, ecological sustainability, classlessness and freedom, and extending these beyond economy, via feminism and intercommunalism, are positive daily gains, not only in warding off calamities.

Questions should arise in your mind. More assessment is needed to make a full case. In this brief presentation we claim only that the above presentation, albeit brief, ought to motivate further investigation and thought. After all, if things are as indicated here, the implications for current activity are profound, and that is important to determine.


Current Choices

What would having a vision like the one described above, called participatory economics imply for today’s practical choices?

The answer in the large is as self evident as the rest of this discussion. If you want to get someplace new from where you are, it behooves you to take steps that take you where you want to go, not steps that take you somewhere else.

An obvious corollary is that you shouldn’t reinforce unwanted old structures nor should you create new ones that are contrary to reaching your destination. Conversely, you should want to undermine unwanted old structures and to develop new structures in tune with your aims. The familiar slogan is, “Plant the seeds of the future in the present.”

With this view we should want to win changes that better the lot of people who are suffering. We should want to seek those changes, however, in ways that develop consciousness, commitment, and desires suitable to winning still more gains on a continuing path toward our ultimate destination. And we should want to build new institutions – both for struggle and when possible also for daily life – whose attributes increase consciousness, commitment, and desires suitable to winning still more gains, and whose features are compatible with and able to melt into the features of the new society we seek.

Suppose we take a couple of examples – where more are easy to assess. Say we desire improvements in income for some poor constituency such as low wage workers. Of course we will demand and seek to win higher pay, as one possibility. But with the approach suggested here we would do it talking not only about the immediate demand, but about what is really ultimately warranted, which is equitable remuneration, including developing awareness of what that would look like and imply, and of what it would take to win, and of how the current effort to win more pay now for some workers could be part of a longer project to win equitable remuneration for all. We would organize, as well, in ways that would leave our constituency not only more aware and desiring still more gains, but also stronger and ready to embark on winning more. We would develop campaigns and organization designed to move on to new goals after winning the current one.

The same logic applies far more generally. Say we are addressing some more macro issue such as defense spending. Again we would make demands for immediate gains in defense spending cuts, for example, but we would use rhetoric and discussion elaborating ultimate aims – say a new mode of allocation – and we would try to create structures of struggle that would persist and keep battling to eventually melt into new structures of a new society.

If we compare the above – which is taking a non reformist approach to winning reforms that would benefit worst off constituencies while developing on going campaigns and movements with ever increasing commitment and clarity about ultimate vision – to current approaches to dealing with various crises, the difference should be evident. It is the difference between being status quo oriented (now called reformist) and being change oriented (now called revolutionary) and it is precisely the difference that people of good will and serious intent must embrace on the road to a better society.

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