Tag: market socialism

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Interviews Postcapitalism

Paul Cockshott Interview on Towards a New Socialism – Part 4 – Worker Self-Management in Central Planning

Editor’s note: discussion topics include what worker self-management is, the division of labour, how to overcome rule by the professional-managerial class, whether the Towards a New Socialism model (TNS) can fulfil aspirations for worker self-management, innovation and product development, the managerial structure of a project in TNS, hiring and firing in TNS, employment, and strategic planning.

[After The Oligarchy] Hello fellow democrats, futurists, and problem-solvers, this is After The Oligarchy. Today I’m speaking with Dr. Paul Cockshott again.

Paul Cockshott is a computer engineer, Marxist economist, and author of several books, but today I’m interviewing him as co-originator with Allin Cottrell of the post-capitalist model first presented in the book Towards a New Socialism published in 1993.

Today’s conversation is in association with meta: the Centre for Post-capitalist Civilization.

This is the fourth in a series of interviews with Dr. Cockshott about Towards a New Socialism, make sure to watch the other interviews. Today we’ll be discussing some more advanced questions about Towards a New Socialism, so I recommend you read the book to understand what we’re talking about. It’s still in print and there’s free PDF available online which I’ll put in the description.

So, Paul Cockshott thank you very much for joining me again.

[Paul Cockshott] Hi.

[ATO] Today we’re going to talk about worker self-management. We’re going to talk about the relation between the centre and the periphery, or projects, in central planning and in socialism in general.

And how this started was – for viewers, to give context – is that I put a quote to Paul Cockshott from a book that was published by Robin Hahnel, who is co-originator of Participatory Economics and wrote a book called Democratic Economic Planning recently. And I read a quote which was making some criticisms of central planning on the basis that it was incompatible with worker self-management. And then we talked about that briefly, but we didn’t get a chance to go into it fully so that’s what we’re going to do now. So, since then I’ve had an interview with Robin Hahnel about this topic and Dr. Cockshott has seen that as well.

I made the same kind of preamble when talking to Robin Hahnel, just for viewers, that I’m just going to ask you to approach this with an attitude of curiosity and problem solving. That this isn’t about clinging to whatever political identities which we’ve decided that we have and trying to win a debate or score points. It’s about trying to create a better world, and in doing that to honestly look at these problems. I know that that’s how Robin Hahnel approaches this, I know that is how Paul Cockshott approaches this, and I’m just asking you, the audience, to approach it like that as well.

So, before I ask you specific questions are there any initial remarks you’d like to make in response to that interview that I did with Robin Hahnel?

[PC] I think it’ll all come up in the questions you ask.

[ATO] Okay I’d like to begin with a framing question, a general question, which is what in your view is worker self-management? Why is it important? And how is it achieved, how can it be achieved in a society?

[PC] Well it’s fundamentally a question of overcoming the division between mental and manual labour, between those who tell people what to do and those who actually do it. And that is an old basis of class hierarchy going back to the early stages of class society. And in a modern society it takes the form of less educated people being told what to do by more educated people generally. Or in some cases there may be no difference in educational level but people have a managerial authority which enables them to say what’s going to be done.

And this has the disadvantage that the ideas and initiative of people who don’t have the mark of authority and which could improve the operation of systems, whether it’s healthcare systems or industrial production systems, and their knowledge is disregarded or down-valued compared to the knowledge of those who are put in authority.

Overcoming this requires the sorts of struggles that were partially worked out during the cultural revolution in China. They didn’t end up with forms of organization that were stable to deal with that. But the issues that were being raised were relevant, and these will certainly still be a big issue in any society where you’re having radical socialist change. The issue of how do you get people who are initially educated members of the upper middle class, the professional managerial class, who have certain skills which are necessary for society but they have their own class interest. They have their interest in maintaining a higher social status, and a higher income and authority over other people. So, it’s the issue of how do you get people who are both read an expert and how do you ensure that those who may not initially ideologically support socialism will still work for the common good.

Now to the extent over time where there’s a radical improvement in educational levels and equalization of educational opportunity, that kind of issue may become less important to some extent. But given that in a market economy those with qualifications tend systematically to have a higher income and towards the upper end of that there are people who aren’t actually exploited, they’re either receiving something roughly equivalent to the labour they put in, or actually receiving part of the labour that others put in. This means that what is in the West the professional managerial class, there’s an interest in becoming a professional managerial class in a socialist economy. And they will push for the increase in their power and their authority. So, it’s basically a question of class interest. Class interest mediated through educational privilege.

[ATO] Okay let’s go into this further by moving into the next question. This is about specifically now Towards a New Socialism. In Towards a New Socialism, there’s a comprehensive plan for the production of the entire economy. And this plan is set by a planning bureau, which is overseen politically by a randomly selected body from the general population. And production is accomplished by projects, which we might think of as enterprises but they’re not exactly the same. And the projects implement the plan.
So, what decisions do workers in a project have control over? And what decisions do workers in a project not have control over?

[PC] Well, let’s take an example where these social relations to an extent already exist, in terms of the production not being enterprise-based in like in the British National Health Service. In that case a hospital is equivalent to a project. Now, over time from the 1980s onwards running of hospitals was increasingly professionalized and handed over to a professional managerial elite, who are distinct from the medical staff and ancillary workers who actually provide the care.

And there was a scandal recently. You’re in Ireland, you may not have seen it. There was a scandal associated with Shrewsbury Maternity Hospital, where there was a very large number of excess neonatal deaths – or babies delivered with brain damage and other injuries. Now, in pursuing what caused that, the inquiry found that it was a managerial policy to set a target to reduce the number of caesarean sections. This was not something that was arrived at by the obstetricians or the midwives, it was a target set by professional managers. By having it set by professional managers they were overriding the clinical judgment of the medical professionals and the result was clearly proven to be deleterious for the mothers and the babies.

If the management of hospitals was made up, or policy was set, by a committee drawn from the different sections of the medical and ancillary staff that worked there, that kind of policy would not have been arrived at. Now, exactly how the supervisory board would be formed, there’s room for discussion on that. Whether it be elected, chosen by a lot, by quotas, or what. Had it been based on the people who actually were delivering the care, the policies would have been different. And these are policies related to how to treat the patients. What practices should be pursued.

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Robin Hahnel Interview on Participatory Economics – Part 4 – Outsourcing and ‘Wage Labour Through the Back Door?’

Editor’s note: discussion topics include how to decide which workers are members of a particular worker council in Participatory Economics (parecon), whether this threatens wage labour exploitation through the back door in market socialism or parecon, balancing jobs and reproductive labour in parecon, and outsourcing in capitalism.

[After the Oligarchy] Hello everybody, this is After the Oligarchy. Today I’m speaking with Professor Robin Hahnel.

Robin Hahnel is a professor of economics in the United States, co-founder with Michael Albert of the post-capitalist model known as Participatory Economics (Parecon), and author of many books.

Today’s conversation is in association with meta: the Centre for Post-capitalist Civilization. This is the first in a series of interviews with Professor Hahnel about Participatory Economics, and in particular his latest book Democratic Economic Planning published in 2021. If you haven’t watched the first interview check out Part A and Part B here.

It’s an advanced discussion of the model proposed in that book so I recommend you familiarize yourself with participatory economics to understand what we’re talking about. You can do that by visiting participatoryeconomy.org. You can also read Of the People, By the People for a concise introduction to parecon.

The discussion will also continue on the forum of participatoryeconomy.org.

Robin Hahnel thank you very much for joining me.

[Robin Hahnel] Great to be with you.

[ATO] So, the question is about how to decide who is a worker council member and who isn’t. In parecon, how does a worker council decide who is a member who isn’t?

For consumer councils the answer is a simple matter of geography, if you live in a certain area you’re part of that consumer council. That’s easy.

However for worker council it’s more complicated. A worker council will use many labour inputs, but some of them will be considered internal inputs of labour from the worker council members and some will be considered external inputs of labour from non-members. How is this distinction made in practice? And how is this distinction made such that wage labour isn’t introduced through the back door by excluding certain workers from membership? For example, just to illustrate that, again coming back to our furniture factory, let’s say you have a handful of cleaners who come in and they clean the offices every day. You could imagine that those cleaners would be part of the furniture factory worker council. You could also imagine that there’s almost a subcontracting situation where the worker council hires the cleaners as external labour and then pays them differently.

But then again, maybe I’m thinking of this just in terms of a market. But please, anyway, just come in.

[RH] There are no external workers.

I mean, first let’s just deal with the basics. So, how do you become a member of a worker council? You go to their personnel department and you apply. So for existing worker councils you’re free to quit the one you’re in and apply to work in any other one.

There’s a more complicated issue about how do new workers councils come into being, particularly because as soon as we have a worker council they get to participate during the annual planning process and they could be allocated social resources. So there’s a question of do you have to establish some sort of credentials and credibility before we have you participating in the planning process.

But you’re not you’re not concerned with that.

[ATO] No.

[RH] You’re concerned with an issue that basically comes down to how integrated is an industry. So you could have a single company that makes its own steel and then makes its own automobiles. On the other hand, you could have two companies, one that makes the steel and sells the steel to the automobile company, and the automobile company buys the steel and then goes ahead and makes the automobile out of the steel.

[ATO] Yes. But do you mind if I just make the question a bit more pointed? So, I think probably in the context of parecon the question might be a confusion. But I’m thinking about it because this is a concern that I have about market socialism. And, for example, let’s look at Google under capitalism, then consider it under market socialism, say, and this will explain where I’m coming from.

So, Google today has wonderful conditions, like many such workplaces with highly skilled labour, where you can get your food there, and relax on bean bags, and blah, blah, blah. However, if you clean the offices where the software engineers work, you have no labour rights, you’re considered self-employed, you’re paid very little, and you’re just treated like human waste essentially. Okay, that’s capitalism.

Now let’s look at market socialism. I have concerns that even in a market socialist society that that worker council which operates Google could have an incentive to treat the cleaners in a similar way. That the cleaners would not be part of that worker council, they wouldn’t get the profit divided by number of members, because there is an incentive to have as few members as possible and it’s still a competitive market situation. So you can reduce costs by paying these cleaners less. And, of course, there’s a whole coordinator class element there, where there’s an issue of bargaining power, and that’s why I picked the cleaners because they have less bargaining power.

So that’s in a market economy. But is that even a question in parecon?

[RH] First of all, this is not an issue that I have thought about so I’m thinking out loud here.

You have a place like Google, and one of the things that has to happen at that place is offices have to be cleaned and the cafeteria has to be [served]. I can tell you that back 30 years ago, thinking about this, the way I would have thought about it would have been well those are some unpleasant tasks and we have to be sure that when we create jobs we have to be sure that everybody is going to have to do some of those unpleasant tasks along with those more pleasant tasks. So I would have viewed this as an issue of how do you balance jobs for both empowerment and desirability. And if you don’t balance them for desirability, how do you compensate that in terms of greater sacrifices and therefore effort ratings.

And I think those are perfectly good answers, but what you’ve introduced is a is a second possibility which is, well, wait a minute, you’ve imagined the more integrated production process where a single worker council is both producing software and also cleaning offices. What if we have a whole separate workers council that is cleaning offices? Now the place that that that I’ve actually done some thinking about this is in the chapter on reproductive labour. And there it’s not a question of a workplace, it’s a question of are there going to be households that hire people to [do reproductive labour]? Are you going to be able to [hire someone to do] gardening for you and they’re going to be all male? And are you going to be able to hire people to come and make your beds, and do your laundry, and do a deep cleaning on your house, and those people in that workers council are going to be all female? It was that sort of problem and issue that we were trying to address. But it introduces the same issue which is if we have this place that says ‘we don’t want to clean our offices at all, we want to hire another worker’s council to come and do this’ …

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Robin Hahnel Interview on Participatory Economics – Part 3 – Worker Councils, Efficiency, Labour Cost, Automation

Editor’s note: discussion topics include what production targets for individual production units benefit society as a whole the most in a Participatory Economy (parecon), how to calculate the cost of labour in parecon, how to determine pay for workers in parecon, the role of automation in parecon, unemployment in planned economies vs. market economies, and whether parecon is incentive compatible with efficient use of automation.

[After the Oligarchy] Hello everybody, this is After the Oligarchy. Today I’m speaking with Professor Robin Hahnel.

Robin Hahnel is a professor of economics in the United States, co-founder with Michael Albert of the post-capitalist model known as Participatory Economics (Parecon), and author of many books.

Today’s conversation is in association with meta: the Centre for Post-capitalist Civilization. This is the first in a series of interviews with Professor Hahnel about Participatory Economics, and in particular his latest book Democratic Economic Planning published in 2021. If you haven’t watched the first interview check out Part A and Part B here.

It’s an advanced discussion of the model proposed in that book so I recommend you familiarize yourself with participatory economics to understand what we’re talking about. You can do that by visiting participatoryeconomy.org. You can also read Of the People, By the People for a concise introduction to parecon.

The discussion will also continue on the forum of participatoryeconomy.org.

Robin Hahnel thank you very much for joining me.

[Robin Hahnel] Great to be with you. [Music]

[ATO] We were talking about worker self-management there at length, and there’s been a lot of talk of social cost and social benefit, and production proposals, and how the social interest is factored into the formulation and revision of production of proposals through this calculation of social benefit and social cost.

So, let’s dive into that with this question, and the question is: you made the point that if a workers council makes a proposal, as long as the social benefit that is produced by that proposal, and calculated, is at least equal to the social cost of that proposal – for the labour, the different resources, the capital goods, the pollution it generates, and so on – if those are at least equal, at parity, then at least people are no worse off because of it, right? And so the question is: are worker councils always aiming for social benefit divided by social costs is equal to one (SB/SC = 1)? Surely there is no progress unless the social benefit is greater than the social cost, in the long run, say. Would it not be desirable if the aim was for the social benefit to be much greater than the social cost? Representing getting much more out of much less. And if so, what will drive worker councils to achieve this? So it’s two questions there.

[RH] My answer is going to be very economics-y, okay?

[ATO] Sure.

[RH] And when you sent me these questions in advance, and when I looked at this series of questions, I realized ‘oh my god’.

When we teach economics classes and we teach ‘well, how would a profit-maximizing firm decide whether to use more of some input?’, what we say is, well, if when we use more of the input the increase in revenues is higher than the increase in costs, then the firm will keep doing it. And we come up with this rule which basically says a profit-maximizing firm is going to keep using every input right up to the point where the last unit that it used generated an increase in revenue that was exactly equal to the increase in cost.

And then the students will eventually ask me – some bright student in the class at some point will raise their hand and say – ‘well then why did the firm use that last unit?’. And my answer is we don’t really care if it used the last unit. It’s just a little thought experiment so that we can show that it wants to use every unit that generates a little more in revenues than it does in cost. It doesn’t want to use any units that would increase cost more than revenues.

And what you’re asking me is: that marginal unit should I use it or not? And what I’m saying is that’s not the point. So, part of my answer to your question is: when we say that we want workers councils to keep doing what they’re doing right up to the point where the social benefits equal to social costs, it is the same kind of reasoning. What if the social benefits were still greater than the social costs of doing something? Well then we should want that council to keep doing more of it. Whether it does the last little bit isn’t really the point.

Now here’s the second place where things are going to get a little economics-y. One of my criticisms of the usual teaching of microeconomic theory about capitalism is that that’s actually not what profit-maximizing firms do.

[ATO] Yes, yes, yes, yes.

[RH] And they don’t do that because if you keep buying units all the way up to the point where the increase in revenues that comes from it is no bigger than the increase in cost, you haven’t earned any profit on that last unit. And what profit-maximizing firms actually do is they basically have an expected rate of profit. So they’re not going to keep using inputs unless … They’re going to stop whenever the increase in revenues is not only as large as the increase in cost but it’s a little bit more. That gives them that standard rate of profit that they’re insisting on.

And this has been one of the things I’ve always loved about Sraffian economic theory compared to mainstream neoclassical economic theory. Sraffian economic theory basically says: look, in economies there’s a going rate of profit, and that’s rather arbitrary; when the workers’ bargaining power is high, the standard rate of profit will be low; when capitalist bargaining power is high, the standard rate of profit will be high; but there will be some standard rate of profit and firms take that into account.

And so, in a sense, you’re also asking me that. And the answer is again going to be a little economics-y and complicated.

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Yanis Varoufakis Interview on Another Now – Part 2 – Housing, Taxation, Inequality, Monopoly, Workplace Democracy

Editor’s note: discussion topics include security in commercial housing in the Another Now model (AN), taxation in AN, income and wealth inequality in AN, inheritance in AN, time-limited or depreciating money, whether divergent incomes combined with compound interest can lead to class divisions in AN, firm size in AN, monopoly in AN, workplace management structures in AN, and the argument for equal decision-making rights within enterprises.

[After the Oligarchy] Hello everybody, this is After the Oligarchy. Today I’m speaking with Professor Yanis Varoufakis.

Yanis Varoufakis is the former Greek Finance Minister, a professor of economics, co-founder of DiEM25 and the Progressive International, leader of MERA25, and a member of Greek parliament. This is the second in a series of interviews with Professor Varoufakis, if you haven’t watched the first check that out.

Today’s conversation is in association with mέta: the Centre for PostCapitalist Civilization. And the topic is Yanis’s latest book Another Now, published in 2020, which presents a vision of a post-capitalist society. It’s an advanced discussion of the model proposed in that book. If you want an introduction, I wrote an essay and made a 40-minute video doing just that. Though I do recommend that you read the book.

Yanis Varoufakis, thank you very much for joining me.

[Yanis Varoufakis] Well thank you very much for having me on After the Oligarchy. We are living under the oligarchy, but anyway let’s imagine, let’s imagine.

[ATO] Exactly.

So again I have a lot of questions for you. We’ll begin with a question about housing, because after I posted the first interview and also the model summary something that kept coming up again and again from commenters was that they were worried about security in the commercial housing sector. The problem raised was basically that you’re saying that every year, or every period of time, I have to keep bidding to retain access to my house. And if somebody comes along who has more money than me then then I get kicked out.

And, of course, I certainly appreciate the ingenuity of the mechanism, to try to constantly reveal the opportunity cost of the land and the housing for society to be able to get that back so that there isn’t a rentier dynamic in housing.

How would you respond to that question of security?

[YV] Well, firstly, remember that this is about the commercial zone. In in my blueprint, every county – think of it as counties – chooses to create a space that’s not … I mean, it’s democratically determined how large this commercial zone will be. The purpose of this commercial zone is for it to be run commercially by the many, for the many, in order to extract rents from those who want to operate in the commercial zone; rents with which to build social housing, social zoning, social entrepreneurial activities, common spaces, the commons. So it is a good feature, a well-designed feature of the commercial zone, that anybody who wants to operate in it has to live in fear. If you wanted to live in a house that that you paid for, not in a social house, not in a unit within social housing, then yeah I mean live in fear.

Remember, it’s not just that once a year you bid for it, but it’s something like a perpetual auction whereby anybody can actually outbid you and throw you out. Which is great because the commercial zone is there to make money for the many, for every citizen who lives in the social zone and whose activities – whether they’re poetry readings, or paintings, or producing social goods – are being funded by the commercial enterprises within the commercial zone. So it’s okay if you if you live in fear. And the whole point of this permanent auction is to ensure that there is complete incentive compatibility. In other words, that when you declare to the authorities what you value that building or piece of land as that you’re truthful. And you will only be truthful if … you can undervalue it if you want, but then somebody can come and outbid you and throw you out. So I have no defence to those who say that ‘oh, the people who live there in commercial zone will live in fear’. We want them to live in fear.

And, you know, it’s a game for them. The crucial point here is that you don’t have to live in the commercial zone. I would live in the social zone. But if you want a fancy house, a much fancier house than you deserve, or you want to create an enterprise in a place that society does not deem that you should have it, then yes you pay for it. And if you make the money for it, yeah good it all goes back to social housing and the social zone.

[ATO] Okay, so it’s really that that the priority is being put on the redistributive function of the commercial housing zone.

To move on to something else, I’ve a series of questions about income and wealth inequality. This is also a concern for some people, it’s a concern for me as well and any kind of market system … so, for example let’s talk about taxation. In Another Now there are two taxes. I mean, maybe there could be a carbon tax but let’s not go into that. There is a corporation tax, which is a tax on the revenue of all firms, and then there’s a land tax and we were talking about that there.

[YV] Land tax only in the commercial zone, only the commercial.

[ATO] Yes exactly, on the commercial zone. One might say ‘well, are you serious? There’s no income tax?’

[YV] Yeah! There’s no income tax.

[ATO] Because there could be seriously divergent incomes, because different firms could have much different rates of profitability or revenue streams, so it’s likely, one might say, that there is a lot of inequality generated. But there’s no progressive income tax.

[YV] I’m not convinced. I don’t believe there will be. If you look at the capitalist system, or techno-feudal system, in which to live today, inequality – mind numbing and soul-crushing inequality – is the result of two things. Firstly, the private ownership of firms, of the means of production, shares, share markets. That’s one, and finance is the second one. That’s where the huge inequality that is destroying our spirit comes from. Not to mention our planet.

In Another Now there would be neither. Because shares are distributed on the basis of one employee, one member, one share, one vote. And there is no financial sector, the financial sector has been taken over by a distributed ledger of the central bank. And therefore this highly problematic toxic duet – duetto in Italian – between the banker and the mogul, the banker creating, printing, money out of thin air, lending to the mogul, who uses the printing presses of the private bank in order to corner the market in the share market and effectively own everything. And then the wealth begets wealth.

Now why is Zuckerberg so much wealthier today than he was at the beginning of the pandemic. Nothing to do with the profitability of Facebook. It’s got to do with the fact that there is this combination of financial capital – the printing presses of the central bank working for Zuckerberg, not for the people, not for the many unlike in Another Now – and ownership of Facebook. And if you break down ownership of Facebook, and Facebook is equally owned by everybody who works in Facebook, and if you end the printing presses both of the state and the private sector banks operating at full throttle on behalf of the very, very, few, then the inequality that you and I are used to goes.

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Yanis Varoufakis Interview on Another Now – Part 1 – Nationalization, Unemployment, Climate, Public Finance, Debt

Editor’s note: discussion topics include the role of nationalization in the Another Now model (AN), unemployment in AN, whether AN can overcome the climate crisis, interest in AN, public finance in AN, the scope for and means of debt cancellation in AN.

[After the Oligarchy] Hello everybody, this is After The Oligarchy. Today I’m speaking with Yanis Varoufakis

Yanis Varoufakis is the former Greek Finance Minister, a professor of economics, co-founder of DiEM25 and the Progressive International, leader of MERA25, and a member of Greek parliament.

Today’s conversation is in association with mέta: the Centre for Post-Capitalist Civilization. And the topic is Yanis’s latest book Another Now, published in 2020, which presents a vision of a post-capitalist society. It’s an advanced discussion of the model proposed in that book. If you want an introduction, I wrote an essay and made a 40-minute video doing just that. Though I do recommend that you eventually read the book itself, it’s very good.

Yanis Varoufakis thank you for joining me.

[Yanis Varoufakis] Well thank you for doing everything you’ve done, it’s remarkable what you did, thank you.

[AO] Oh yeah my pleasure, my pleasure absolutely.

I have many questions to ask you, including from some viewers, but we can only cover so much in one interview. So we’ll see how we get on.

Q1 – The first question is about nationalization. In Another Now you briefly mentioned that utilities have been nationalized and I was just wondering what is and what is not nationalized? Because ‘utility’ usually refers to things like electricity, gas, sewage, rubbish, and so forth, but … if you want to jump in you can.

[YV] In the book, what I do is I try to tell a story of how we could change the very fabric of the social economic system that we live in by starting from the fact that these were all nationalized utilities, in Ireland, in Britain, Germany, everywhere, they were created by the state primarily because no private business was interested in creating them. Even the BBC was created by the BBC before there was private radio because the fixed costs were too large.

And then in the 1970s with the onslaught of neoliberalism, with Margaret thatcher in Britain, with Ronald Reagan in the United States a bit later in 1980, you have the privatization of all utilities. Effectively the conversion of state monopolies into private monopolies that were presented as marketized, decentralized, but were not really. I mean if you look at the electricity grid and the electricity network in our countries they are still monopolies except that there is an infrastructure of speculation on energy prices. Which is today, given the rise in energy prices and inflation in the post-pandemic world, a clear and present danger to the fabric of society.

So as far as I’m concerned the answer to this is not a re-nationalization but the answer that I propose in the book – and you know this very well because you’ve done a great job at summarizing the blueprint that I’m putting forward – so instead of nationalizing the privatized utilities, I am proposing the socialization of all companies not just the former nationalized utilities or nationally state-owned utilities. Because I’m challenging the very notion of tradable shares. Something we take for granted, that the property rights over companies are segmented in tiny little pieces of paper or digital pieces they call ‘shares’ and that these shares are traded anonymously in markets called ‘share markets’. I challenge that very notion. I think that in the end it’s even antithetical to the mentality, the philosophy, of the original proponents of market societies like Adam Smith.

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Postcapitalism

Post-Capitalism: Another Now by Yanis Varoufakis – Model Summary

Introduction

In this essay, we will summarize the model presented in Another Now, a proposal for a post-capitalist society. This summary is also available in video format (see video embedded below). However, the essay is definitive.

In 2020, Yanis Varoufakis, professor of economics, former Greek finance minister, co-founder of DiEM25 and the Progressive International, general secretary of MERA25, and member of parliament in Greece, published the book Another Now: Dispatches from an Alternative Present. The book discusses an alternate history where humanity broke with capitalism after the 2008 financial crisis. It’s a brilliant book, highly readable, inventive, and likely to appeal to general audience, so I recommend that you read it. This essay will present an abstract summary of the model found in those pages.

Before we begin though, some clarifications are needed.

Firstly, this is not a summary of the book Another Now. Another Now is written in a science fiction format with a lot of dialogue between characters with different opinions. In the book the characters find themselves in contact with another reality i.e Another Now, a post-capitalist reality. The details of that new society are scattered throughout the narrative. So I’m only going to present that alternate reality here. I will not say anything about the characters. And for the most part I’m not going to summarize the arguments made in the book, just the conclusions.

Secondly, this is only a summary of the economic model of Another Now. I’m not going to discuss activism, strategy, and transition, even though these topics are discussed in the book and they are crucially important.

Thirdly, this isn’t a review, analysis, critique, or endorsement. I will only provide an exposition of the model.

Brevity is the reason for the foregoing. Those are topics for another date.

Lastly, this essay emphasizes accuracy and completeness. However, it will be very clear and will make extensive use of illustrations. If you follow you’ll understand and by the end you’ll be an expert in Another Now.

Now, before we dive into the details I want to quickly give you the gist of Another Now. It’s a kind of socialism. There’s a big emphasis on properly functioning markets, on worker self-management, on radically reforming finance (especially through a public payment system), on international economic institutions, on the public ownership of land, on digital data rights, and there is extensive use of sortition for regulation and governance.

If you haven’t come across the word ‘sortition’, it means picking people at random (sorting people). You can use many different words: sortition, lottery, by lot. Effectively it means picking people at random. And this is the technique which was used predominantly in the Athenian democracy.

The main headings for the essay are as follows. I grouped the proposals in Another Now into five main categories:

  1. Production Units & Regulation
  2. Finance
  3. Digital Information
  4. Land & Immigration
  5. International Trade and Development.
Figure 0 – Summary diagram of some key features of Another Now.

Before moving systematically through those headings, I want to give you a global picture of the model. Production units are divided into a nationalized sector, a worker-owned sector, and a domestic economy. And these production units are regulated by Social Accountability Juries. The central bank has a very important role, with a public payment system, local digital currencies, a private credit system, and each resident having an account at the central bank (broken into three sections with different functions). People have full property rights over their digital information and its use is controlled by a Sovereign Data Fund and micro-payment system. Land is publicly owned and is governed by County Associations, and immigration is managed regionally. Lastly, there’s a relation between the nation state and other states through the International Monetary Project, which regulates international trade and economic development.

Don’t worry, I don’t expect you to understand this yet. All will be explained.

Continue reading “Post-Capitalism: Another Now by Yanis Varoufakis – Model Summary”
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Interviews Postcapitalism

Paul Cockshott Interview on Towards a New Socialism – Part 1 – Planning, Self-Employment, IP, Media, Privacy, Transition

Editor’s note: discussion topics include the motivation for economic planning versus market socialism, self-employment in the Towards A New Socialism model (TNS), intellectual property in TNS, independence of media in TNS, efficiency in TNS, labour credits and privacy in TNS, the weaknesses of TNS, how not to implement TNS in a socialist transition, and a hypothetical TNS research programme.

[After the Oligarchy] I’m talking to Paul Cockshott today. I’m just going to read his bio from a book How the World Works which I’m reading at the moment (which is very good): Paul Cockshott is a computer engineer working on computer design and teaching computer science at universities in Scotland. Named on 52 patents, his research covers robotics, computer parallelism, 3D TV, foundations of computability, and data compression. His books include Towards a New Socialism, Classical Econophysics, and Computation and its Limits.

Today we’re going to be talking about the book Towards a New Socialism written by Paul Cockshott and Allin Cottrell, published in 1993. There the authors present a bold vision of a democratically planned economy using computerized labour time. In this interview we’ll be discussing some more advanced questions about that model so I recommend that you read the book to really understand what we’re talking about.

You can also watch some excellent videos on Dr. Cockshott’s YouTube channel, here is a link to that, and his website and blog.

[Paul Cockshott] Just seeing if I had a copy of the book but I don’t seem to have one. I can’t wave one around here …

[AO] I have one actually … do I? Yeah I have one here so it’s all right. Look there it is!   

Dr. Paul Cockshott thank you very much for joining me.

1 – So we’ll begin with the first question, a more general one. Some advocates of market socialism say that ‘central planning is a solution looking for a problem’. How would you answer in response to an advocate of the most sophisticated and radical kinds of market socialism? A critic might say something like ‘well, yes, there can be direct state provision of all necessities and control key sectors, but once working-class incomes are substantially increased due to worker self-management of firms, suppression of rentiers, plus state regulation of the market, a Job Guarantee, and so forth, there’s no need to have a society which uses central computerized planning and labour time. How would you respond to that?

[PC] Well my feeling is that whilst a Yugoslav-type system would be a considerable advance for most people, the Yugoslav economy – which is the historical example we’ve got of such a model – had a series of contradictions which developed over time. One of them was that because it is a market system the market does not regulate total demand for labour to be equal to the number of people wanting to work and there was an unemployment problem in Yugoslavia because of that. There was never an unemployment problem in the Soviet Union, for example. And the solution to it during the 1960s and 70s was emigration to Germany so it can’t be said to have really solved the problem of providing full employment for everyone.

Now the second point is that over time you also got the build-up of increasing regional disparities. These regional disparities became so intense that the conflicts associated with them eventually led to the breakup of the state. And the problem is that market economies tend to lead to uneven development – geographically uneven development – and the state can survive if it’s a strong centralized state that holds the country together and is not threatened but it certainly proved to be a critical failure in the Yugoslav example.

More generally if you say there’s going to be a job guarantee what does that job guarantee mean? How is the job guarantee going to be met? Is it going to be met by the state expanding employment in state industries? In which case you have the progressive replacement of a cooperative sector with a state sector.

The next issue is how does such a market socialist system adapt to externally imposed imperatives? Now, historically, the externally imposed imperatives have been to industrialize as rapidly as possible, for example, but at the moment the externally imposed imperatives are to transform the whole economy within a very short time from one based on fossil fuels to one based on non-fossil fuels. Now that is an in-kind constraint. It’s a physical constraint. It’s not a constraint that is readily addressed by market means. Any attempt to address it by market means is an indirect dressing up of state planning via market incentives. The state plans to do something and has rather inefficiently to try to create a set of market incentives which realize the plan.

Now we know that for the last couple of decades, states have formally been agreeing to reduce carbon output. And following the neoliberal doctrine that everything has got to be done by market incentives, attempts have been made to do this by market incentives. And in general the performance has not been good

Continue reading “Paul Cockshott Interview on Towards a New Socialism – Part 1 – Planning, Self-Employment, IP, Media, Privacy, Transition”