For many people, a major mental barrier to accepting economic change is the lack of a conceptual alternative. It’s not just enough for Leftists to criticize the current system: people can move past their accustomed patterns of thinking only when you offer them a new model to replace the old. The Left, however, has become really bad at getting new ideas heard, because its centrists constantly resist casting a vision in moral terms. And we need the world to start thinking now about change if we are going to be nimble enough in the coming decades to successfully face our many self-created crises.
I have been thinking about economic alternatives for a long time, so it is very easy for me now to imagine all kinds of different economic arrangements. Our current system calls itself a free market democracy, but it is really a consumerist corporate oligopoly, although it wasn't always so. There are many alternatives to consider that would be beneficial for people and the environment, and I will discuss some of them in future posts, but for now I’ll just list a few. These are just a start, and there are many more:
- Worker’s Cooperatives, such as Mondragon, in which workers own their enterprises and run them democratically
- Parecon, or participatory economic councils where interested stakeholders like town and cities help organize economic activity
- Strict anti-trust laws and enforcement to keep businesses small and subject to the discipline of both competition and rational government regulation
- Intentional communities, such as cohousing and even self-sustainable ecovillages
- Permaculture and local agriculture
- Dispersed renewable energy – not massive power plant or even giant wind farms, but smaller, networked generation
- Local currencies
- Public enterprises – nationalization or utilities – where appropriate, such as in the finance, energy, defense, and infrastructure sectors, and to some degree communications and transportation.
- A rational industrial policy, to promote diversification of the economy away from finance
- Much greater public investment in research, infrastructure, and environmental renewal, through public research institutes and a revitalized Works Progress Administration and Civilian Conservation Corps.
- Remove basic goods, such as milk and bread, from market pricing altogether, an idea of Howard Zinn’s, who argued that we can surely do so with the incredibly productive economic engine we have
- Free public education at all levels, even up through college.
- And the full scale of social insurance in health, retirement, unemployment, injury and disability, and parenting.
State communism, the last major real-world challenger that attempted an alternative system to capitalism, died when the Berlin Wall fell. This also has discredited all attempts to explore alternative economic systems, for good or ill. Since communism offered the only alternative system to capitalism philosophically as well, the fall of the Soviet Union also left a vacuum of vision in economic philosophy. Already by the 1950s and 1960s much of the Left, for example the Frankfurt school of critical Marxists, turned solely to social critique of capitalism and the culture it manufactured and declined to offer positive alternatives. Then, after 1989, many if not most on the American Left and center-Left accepted the market as the basis for the economy, if modestly restrained by an active government to blunt its edge, provide a safety net, and prevent pollution. Many accepted consumerism and growth as the purposes of economic activity, but just wanted to make sure they were widely spread.
The Cold War thus imposed a simplistic economic dichotomy, presented as an existential death match between state and market, and the residuum of that dichotomy remains with us as a conceptual frame through which nearly all economic thinking is filtered. In the aftermath of the Cold War many people still instinctively fall into the conceptual trap of the either/or capitalism/communism binary. Much of that dichotomy was false in the first place: all economies are actually mixed economies, some combination of state and private activity: the pure market of naïve libertarian dreams is as much a fantasy as the pure planning of communist dreams. America has always had strong state “intervention” in the economy, and a large part of the Soviet economy consisted of black markets.
As I’ve argued, we don’t have to be stuck in that dichotomy. The trick, given where we are starting, is partially about finding the right balance of state and market, and the US needs to learn many lessons from the more egalitarian Western European countries. But we also need to overhaul the cluster of economic institutions at lower levels to make them just, egalitarian, and sustainable. The solutions to our problems are not about the overarching system: an economy consists of real, concrete practices, institutions, and cultural habits, and these vary in different times and places. Change them and you can make great improvements:
- Property rights, which are always somewhat different for different kinds of goods, i.e. owning a car is subject to different rules than owning a cup or a crayon, and owning a factory to other different rules
- Labor systems, whether slavery, serfdom, wage-labor, or cooperative firm
- The basic economic unit: the feudal manor, slave plantation, yeoman farm, small business, large corporation, or cooperative firm
- Production centers – factories, farms, offices
- Warehouses and other wholesale facilities
- Retail stores of various sizes
- Zoning ordinances
- Banking and finance – there are many ways of doing this that differ from our rapacious sociopathic Wall Street institutions, from small community or association banks to national banks to sovereign wealth funds
- Currency – local or national? Is it a tender of price or of time?
- Physical infrastructure – roads, canals, seaports, airports, communication lines
- Energy system - Renewable or petroleum-based? Centralized or decentralized?
- Communication and information delivery systems – whether carrier pigeon, newspaper, telegraph, telephone, broadcasting, or the internet
- The so-called “informal” economy of unpaid domestic labor (which has often had sexist undertones in economic theory)
- This list is not exhaustive; there are many other smaller, sub-system components to an economy. Thinking about these smaller, concrete parts differently lets one imagine changes that go beyond the capitalism/communism binary.
I’m all for anything that allows non-commercial economics, and thus non-commercial values, to flourish. So how do we start from here and create an environmentally sustainable economy that supports human flourishing? Throw the kitchen sink at it. Go full bore with any reform, large or small, that will end corporate oligarchy, democratize the economy, and solve the problem of inequality. Once we have done that, at the end we will look back and say that we have created a new economy, and may even be ready to take further steps in the future. The sum of the changes would end up being greater than each part.