Summarizing Participatory Economics

For purposes of exploration and debate with Libertarian Municipalism’s Peter Staudenmaier. See whole debate here.


Since we have already had some exchange on Parecon and Libertarian Municipalism (see http://www.zcomm.org/znet/viewArticle/18571) I will keep these opening comments brief.

The task of developing a vision for any sphere of social life is to set out the functions the domain must accomplish, the values we hold dear, and the institutions that can accomplish the functions while propelling the values.

For the polity, for example, the functions might be legislation, adjudication, and collective implementation. The values might be attaining truthful awareness, solidarity, transparency, justice, and self management. If so, we would have to describe compatible institutions.

For the economy, in contrast, the functions are production, consumption, and allocation. Values I favor are meeting needs and developing potentials plus propelling solidarity, diversity, equity, and self management. An economy should produce worthy outputs, and by the activities it demands produce empathy rather than hostility, variety rather than homogeneity, equity rather than exploitation, and self management rather than elite rule.

We have in the U.S. now a capitalist economy in which some people own corporations, markets regulate allocation, and if you look inside workplaces you find a corporate hierarchies in which some people do rote manual labor, some people have more skilled tasks, and a few people monopolize decision making and the information and skills requisite to it. That’s the guts of capitalism–private ownership of workplaces, hierarchical workplace organization, and market allocation.

Parecon rejects private ownership because it leads to few people owning and controlling almost all the wealth and therefore wielding tremendous power. In the U.S., commentators discuss the bottom 90 percent of the population, and while that’s an amazing and embarrassing concept, it’s reasonably accurate. The top 10 percent, and actually just the top few percent, effectively run the whole economy. That’s inequitable, unjust, and undemocratic.

Parecon also rejects the hierarchical division of work because it ensures that most people have little or no say over their labor and aren’t empowered equally in the workplace or responsible for a fair share of fulfilling as well as not so fulfilling tasks. Yet, there’s no ethical reason or economic reason why some people should enjoy more fulfilling and less dangerous or boring responsibilities than others, much less have greater decision making power.

And parecon also wishes to abolish the market. Markets destroy social conscience. They don’t operate unless people advance only themselves. When people who own businesses advance only themselves, they seek profits regardless of adverse effects on the ecology, on their workers, and even on consumers. Likewise, individual workers and consumers benefit when they ignore the well being of the people who produce what they consume or consume what they produce. Nice guys finish last, or in my own version of this famous aphorism: garbage rises. That is, buyers and sellers operate in isolation from social concern, trying to get ahead at others’ expense. Being nice in the competitive rat race means you don’t rise in income or power. If you win the race, you are just a better rat. And markets have many more ills, as well, for example, creating inequality, fostering unemployment, causing ecological disruption, imposing alienation, promoting personality distortion, and most damning, producing class division.

So participatory economics is a new type system based on different defining institutions. It is described in considerable detail in various books, essays, etc., many of which are available online at www.parecon.org. To accomplish its mutually reinforcing goals it incorporates workplace and consumer councils, self managing decision making procedures, remuneration for effort and sacrifice, balanced job complexes, and participatory planning. Here, then, is only a very brief summary of these features, to set the stage for further discussion.

In participatory economics, instead of private ownership of capital, everybody equally owns the means of production. Productive assets are shared among the whole populace, so ownership is equal and generates no differentials in income, well being, or influence. How well off each person is, how much income they have, and how much influence over decisions they can manifest are all affected by norms of remuneration and by allocation and workplace organization, but not by property.

Thus, in a parecon instead of people being remunerated for their property, or for their bargaining power, or even for their output, people are remunerated for the effort they expend and for the pains they endure in useful labor. If you can’t work, of course you get an average income anyway. If you have special medical needs, naturally, those are socially met. But for those who can work, how much of the social product they consume depends on how hard they work, not on how much power they can accrue or even the output they produce. This is moral and it provides sensible incentives even as it turns upside down current formulations of what is just and equitable.

For allocation in a parecon, people in their councils develop an agenda for what is to be done. Everyone participates in that process. We figure out what we want to do at work or to consume, both individually and with our work groups or consumer units, and we propose our views. The mesh of those proposals is refined, back and forth, in a number of rounds of give-and-take, until we settle on a comprehensive agenda. Everyone influences this give-and-take in proportion as they are affected by the decisions under consideration, so the system is participatory and self-managing. Of course there are various relevant structures and processes of greater detail, but the essence is as noted, a cooperative self-managing negotiation of collective well being rather than a top down or competitive pursuit of narrow gain.

Another key defining feature is the way parecon organizes the workplace. In capitalism, we take all the tasks in the workplace and combine them into jobs where each actor has numerous instances of only one broad type of task. One person does a variety of janitorial tasks and is a janitor. Someone else answers the phone and does some other secretarial tasks and is a secretary. Someone else administers employees or processes information and is a manager. Another person determines financial policy, projects revenues, decides policy, etc., and is the CEO. Each job occupies a place in a hierarchical scheme.

In participatory economics, in contrast, we combine diverse tasks into jobs so that each person has a fair share of different kinds of tasks. It’s like taking items from a menu to make a nourishing meal. The capitalist way is to take instances of only one type of food and call it a meal–only vegetables, only junk food. With the capitalist approach some get all empowering and fulfilling tasks, others get all disempowering and rote or otherwise onerous tasks. The former folks, by virtue of the advantages and inclinations their work gives them, dominate the latter folks. The participatory way, in contrast, is to serve up a balanced selection of a variety of complementary tasks in each job, so that in sum total we each have comparably rewarding and empowering conditions in our daily economic work lives. Each person gets a fair and comparable assignment — what we call a balanced job complex, so that a subset don’t rule over the rest. We don’t all do the same tasks, of course, but we all do a range of tasks with essentially the same sum total of quality of life and empowerment implications for us.

In its workplaces, that is, every economy inevitably creates jobs by combining tasks taken from a menu of all those available. In capitalism, each worker gets one or at most a few very similar types of tasks all situated at one level of authority, skill, and empowerment. In a parecon, instead, each worker gets a diverse selection of tasks combined into jobs that are balanced so that everybody has a share of the more rewarding and the more onerous, the more empowering and the more rote with overall comparable implications. It’s essential to do this, first because it’s equitable. There’s no moral reason why overall some people should be bored and others enlivened, some obedient and others take responsibility. It’s also essential to balance workplace circumstances because balanced conditions empower people to participate appropriately in self managed decision-making. Instead of some of us being bored and kept relatively ignorant by our work while others are continually refining their decision making skills and monopolizing relevant knowledge — with balanced job complexes we all develop our potentials to participate with readiness and skill.

The difference between capitalism and participatory economics is the difference between private ownership, corporate hierarchy, remuneration for property and power, and markets, on the one hand, and council self management, balanced job complexes, remuneration for effort, sacrifice and need, and participatory planning, on the other. It is the difference between class division and classlessness. It is the difference between spending immense sums building missiles that sit in the ground while assigning little to finance quality health care, and doing the reverse. It’s the difference between using schools to teach most people to endure boredom so they’ll be prepared to work obediently beneath other people who have had elite schooling, and using schools to develop all peoples’ skills and talents so that everyone will participate and contribute in a balanced way. It’s the difference between elites making all decisions and pursuing their own gain, the rest be damned, and everyone participating proportionately in a context that makes each person’s well being transparently dependent on the well being of others. It is the difference between a few people having immense power and wealth while most are barely getting by and everyone having a fair share.

Parecon, it would seem, should be congenial to anyone concerned to reduce hierarchy to a minimum, or, put more positively, it should be congenial to all those who wish to enhance each actor’s influence over outcomes commensurate with all actors having the same opportunities. In that sense, it seems to me to be an anarchist economic vision.

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