Gar Alperovitz's Blog, page 7

Podcast: Conversation with David Harvey on Capitalism

TeleSUR English’s “The Laura Flanders Show” hosted a conversation with economic theorists Gar Alperovitz and David Harvey on what is to be done about wealth inequality and capitalism, and efforts currently underway to move beyond them.

Listen now:

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David Harvey and Gar Alperovitz on Cooperation and Capitalism

The post David Harvey and Gar Alperovitz on Cooperation and Capitalism appeared first on Gar Alperovitz.

Is economic stagnation the new normal?

Originally published in the Los Angeles Times on September 4, 2014.

The concept of “secular stagnation” — that the economy may be facing a protracted period of low growth and high unemployment — has been seeping back into economic and policy discourse. Once relegated to the margins of heterodox economic theory, the idea of stagnation as a likely ongoing direction for the economy, in fact, is now virtually mainstream, expounded by such well-known figures as Lawrence Summers and Paul Krugman.

Stagnation, however, is not a new problem. Careful examination of the U.S. economy over the last century suggests that stagnation may not be the exception but just possibly the rule of modern economic performance — a rule that was mainly broken only by the stimulus effects of massive military expenditures at three crucial junctures.

Major economic floundering in the first quarter of the 20th century was relieved by the boost World War I gave to the economy, and the tremendous economic collapse in the second quarter was ended by World War II’s huge increase in military spending. In the third quarter, the Korean War, the Cold War and the Vietnam War added major stimulus at key times.

Moreover, several of the indirect consequences of World War II — including wartime savings, the compression of wages, the strengthening of unions, the GI Bill that educated millions of veterans, and the reconstruction of Europe, together with the fact that major competitors had been temporarily destroyed by war — all contributed to the third quarter’s great economic boom.
The modern trend, despite Iraq, Afghanistan and other smaller-scale wars, is also clear. Defense expenditures declined decade by decade from a Korean War high of 13.8% of the economy in 1953 to 3.7% in the 2000s, with steadily reduced economic impact. The financial bubbles in the late 1980s, 1990s and early 2000s produced only partial and highly unstable upswings that masked the underlying decline.


The notion that stagnation is far more important than is commonly understood has been bolstered by Thomas Piketty’s landmark book “Capital in the Twenty-First Century,” which also emphasizes just how unusual the era of the Depression and two world wars was. Piketty’s analysis suggests that the high growth rates of the post-World War II period were, by and large, an aberration. “Many people think that growth ought to be at least 3 or 4 percent a year,” he wrote. “Both history and logic show this to be illusory.”


Viewed in this light, the latest long-range projections from the Organization for Economic Cooperation and Development, the Paris-based intergovernmental group for advanced economies, make for sobering reading. In a new report, “Policy Challenges for the Next 50 Years,” the OECD warns that economic growth in the world’s advanced industrial economies — including Europe, North America and Japan — will likely slow even further from historic levels over the next half-century, while inequality will rocket to new heights and climate change will take an increasingly damaging toll on world GDP.

According to the projections, the OECD member nations’ annual average contribution to global GDP growth will steadily fall from 1.19% this decade to 0.54% between 2050 and 2060. Meanwhile, inequality in these countries may rise as much as 30% or more.

The OECD projections are, if anything, optimistic, since they assume that Europe and the United States each will absorb in the neighborhood of 50 million new immigrants over this period — an assumption that may run contrary to the restrictive politics of immigration playing out on both sides of the Atlantic.

The economic remedy for stagnation is relatively straightforward — in theory: Faltering demand could be offset by large-scale government spending on infrastructure, education and other much-needed investments. In practice, however, it is painfully clear that large-scale Keynesian policies of this kind are no longer politically viable.

The implications of the emerging possibility of a sustained period of stagnation are profound. Through the repeated economic downturns of recent U.S. history — 11 since 1945 alone — the expectation of eventual sustained recovery has been the critical assumption underpinning both politics and policy. An era of stagnation would undermine the economic basis of traditional political hope of both left and right. It would mean ongoing high unemployment, ongoing deficits, ongoing struggles to fund public programs and, in all probability, ongoing and intensified political deadlock and wrangling as unemployment continues, deficits increase and a profound battle over narrowing economic possibilities sets in.

If stagnation is the new normal, we will likely be forced to reassess the fundamental assumptions of politics and the economy and to ultimately get serious about restructuring our faltering economic system in more far-reaching ways than most Americans have contemplated.

 

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Envisioning Where We Want to Go: An Interview With Evolutionary Reconstructionist Gar Alperovitz

Originally published on Truthout on August 22, 2014. Interview by Leslie Thatcher.

Longtime activist, historian and political-economic theorist Gar Alperovitz, whoseAmerica Beyond Capitalism was serialized on Truthout, conducted an email interview with us on the occasion of the creation of his new website.

Leslie Thatcher for Truthout: Gar, you’ve just created a new website that seems both to sum up the principles of your work on democratic ownership and on building a sustainable and equitable political-economic system and to track your personal trajectory as an activist and thinker over the last 50 years: What are your goals in establishing the website?

Gar Alperovitz: As you know, the Democracy Collaborative does a great deal of direct hands-on work helping establish worker-cooperatives and other efforts aimed at democratizing the ownership of wealth at different levels. The impetus for the website came from one of our lead researchers, Thomas Hanna, who suggested it might be useful to pull together some of the work I had been doing over the past several decades on the theory that informs much of our strategy.

From the late 1960s on, it seemed to me that a serious movement would ultimately have to go beyond simply urging “elements” of the next system (as for instance, simply promoting worker-owned firms, necessary as this is). It will have to begin to develop a clear and explicit larger vision and some quite specific ideas about why the “institutional design and architecture” of that vision would produce results better than the two traditional models – corporate capitalism, on the one hand, and state-socialism, on the other.

The primary goal of the website is to offer some explicit hand-holds (as I see them) for activists and theorists on how we might get serious about what a “next system” might really look like, and why, precisely, it would be better than the traditional models – and better, too, than some of the models that are commonly discussed in rhetorical terms without adequate attention to some of their well-known failings.

Put another way, the goal is to contribute to the discussion that is fast becoming critical: “If you don’t like capitalism and you don’t like traditional socialism, what do you want, and why – specifically, not rhetorically, would it be better?”

We’ve covered this before, but I’d be so grateful if you’d explain what you mean by and how you developed the term, “Pluralist Commonwealth.”

Briefly, I use this term to suggest that a serious next system must be built on the principle of plural forms of common wealth ownership – hence “pluralist commonwealth.” Basically, I’ve been trying to help move the dialogue beyond the oversimplified left debate that poses the only alternatives as either state socialism or worker-owned or worker-self-managed socialism. I think the next system will be much more interesting and complex in its structure - and should be!  Especially, if we want to build a genuine democratic community-nurturing system from the ground up.

Among the forms: worker ownership, neighborhood ownership (particularly for some forms of land); community (or municipal ownership) for other functions; state ownership (as, for instance, in the State Bank of North Dakota); regional ownership (particularly when large ecological challenges are involved – as in the original plan for the Tennessee Valley Authority before it was undermined and corrupted); and, of course, national ownership for larger entities still. Participatory worker self-management in all elements, etc.

The website brings together work suggesting that if you really dig into the questions involved, it becomes clear that any viable next system is all but certain to have to develop forms of ownership appropriate to different scales and functions (and also environmental) issues and also to different democratic challenges – and that it is time to recognize this. “Pluralist Commonwealth” simply underscores this point, and also attempts to suggest various approaches can be integrated in a larger community nurturing and sustaining systemic architecture.

In the very moving video of a 2012 address you gave that’s on the site’s homepage, you describe the price that must be paid to work for systemic change as “decades of your life.” You have clearly paid this price and then some, but a cynical observer might say the systemic change – at least for the last 40 years – has all been in the wrong direction. How would you counter that?

Specifically, you were involved early on and very actively in the civil rights movement in the ’60s and the apparent legislative and social victories against institutional racism, yet here we are with the new Jim Crow and an arguably stronger – because ostensibly color-blind – structural racism that includes a rollback of key provisions of the Voting Rights Act. What has this trajectory taught you about social change?

The first and most fundamental answer is that any attempt to challenge the structure of the most powerful corporate capitalist system in the history of the world would be foolish to assume this can be done in a short period of time. Hence, obviously, decades of one’s life are required if you are serious.

I am not, however, a utopian. I come at the question as an historian and a political-economist.  I believe there are quite specific reasons why the current system is facing huge problems that it cannot solve – and that therefore we are likely to face ever-growing difficulties for some time. It is no surprise to me that we are seeing rollbacks of the Voting Rights Act, and I expect many other rollbacks, along with economic pain, and social disruption, etc.

I do not, however, think that this phase of development is the only or final phase of development. Indeed, precisely because there is growing pain, social disruption, the rolling back of previous gains, etc., there are also reasons to believe quite new directions in social movement building, in the construction of pre-figurative economic and other institutions and in serious strategic and systemic thinking are all but certain to continue to grow, deepen and become more and more sophisticated as time goes on. Indeed, although the decaying national press does not report on it, anyone who follows what is going on at the grass-roots level – from climate change activism to worker-owned co-op construction to the takeover of a municipal utility in Bolder, and the use of eminent domain in Richmond, California, etc., etc. knows that something is quietly building in response to the systemic failures (and, too, in response to the decay of the traditional progressive solution – liberalprogrammatic politics, a politics that is no longer empowered, as it once was, by a strong labor movement . . . )

I think the emerging era – despite the pain, and indeed in large part because of it – may be the most important and interesting era in American history: The existing system is running out of options. Hence getting very, very serious (and thoughtful) both about what we really want and how to move forward laying groundwork, in practice and in theory, is of extreme importance.

Under the “Climate Change Growth and the Environment” rubric of the Pluralist Commonwealth principles, you note: “the critical importance of rebuilding cultures of community accountability and ecological sustainability from the bottom up as ultimately the only way to nurture a larger politics and culture that constrains larger-scale and higher-level enterprise and statist functions in all systems – even those not driven by profit-maximizing pressures” as a strategy to counter the socially and environmentally toxic pressures of an economic growth goal. Concretely, how do you see an alternative to growth being implemented – and, realistically, given the probability of abrupt anthropogenic climate disruption, do we as a society have time to build a new system from the ground up?

No we do not have enough time to do what we know is necessary. But yes, we have enough time to do a very, very great deal to lay foundations for what will be imperfectly necessary, but absolutely critical. I worry about the way in which some people understand terms like “abrupt anthropogenic climate disruption.” It sometimes is taken to mean “the end of the world” – rather than “very, very severe ecological disruptions that can be threatening to many things we hold dear.” The two understandings have radically different implications: Assuming that if we do not change things quickly it will be something like “the end of the world” is disempowering. It’s “all or nothing,” and since things cannot change quickly, what is the point?

I think we are in for very, very severe problems, but I do not think that means we can do nothing to partly moderate and ultimately overcome the problems, or at least establish a new equilibrium. My view is as follows:

[1] It is “possible” nothing significant can be done; [2] It is also possible that we can lay groundwork for long run change to a new direction – moving to and through the great disruptions – and ultimately establish the basis of a new reality; [3] It is impossible to know in advance how far we can go towards a serious solution; [4] It is far better to act in ways that can help produce what can be produced than to assume in advance that it is all impossible. That direction insures that the problem will never be dealt with in any form or in any way.

What is interesting and important in all this is that at the grass-roots level there is enormous energy building around localist elements of a larger long-term solution – solar, new forms of agriculture, altering transportation, capturing methane from garbage and turning it into energy production, challenging universities to alter their investment patterns, creating worker-owned co-ops, etc. etc. The trajectory here is one of ever increasing sophistication and activism, building new institutions and practices from the bottom up – a necessary, but clearly not sufficient, stage in laying groundwork for larger systemic approaches and longer-term political change.

None of this means, of course, that I wouldn’t welcome limitations to carbon emissions under the current system if an unexpected political opportunity made such limitations possible, just as I would welcome non-system-transforming reforms that ameliorate the conditions of the poor.  In both cases (and in many other areas), however, I think it is clear that over the long haul we need to change the logic of the system itself if we want a serious solution.

One of the critical elements of the pluralist commonwealth that most appeals to me is the idea that everyone – especially those presently marginalized because of our social and economic organization (for example, LGBT persons or unpaid caregivers) – should enjoy a role in the community’s economic and political decision-making. How do you see such a program being implemented?

Central to the pluralist commonwealth vision is the notion that unless we put the reconstruction of community at the forefront of strategy – locally, politically and theoretically – we will never build a politics and culture of genuine inclusion. The theory and ideal can be found in most religions, in Martin Buber’s anarcho-communalism, in Raymond Williams culture theory, but also in Karl Marx’s appreciation of the Paris Commune, on the one hand, and the Russian peasant mir  communal form on the other (to say nothing of related themes taken up in the Economic and Philosophical Manuscripts). This emphasis also helps open a direction beyond liberal strategies, on the one hand, and beyond narrow forms of state socialist and worker-owned or controlled socialism on the other. In practical terms it means taking seriously the step-by-step reconstruction of community-building institutions and many forms of cooperative structures. And it means economic planning to stabilize the underpinning local communities.

Do not misunderstand: The fight for individual “rights” is critical – along with institutions like a guaranteed job and/or guaranteed income that give economic support to the individual. But without changing the nature of how we understand the relationship of each individual to the community, what we end up with is individualist demands to be allowed in – rather than a rebuilding of a thorough-going common understanding that there can be no real embrace of individual difference in the absence of a genuinely inclusive community

Take one of the examples you mentioned: unpaid caregivers, whose work is absolutely vital to society, but whose contributions are more or less invisible in the current system. This is a clear case where we need to think in terms of a plural set of institutions rather than a particular “silver bullet” that might solve all our problems in one stroke.  A system based on worker cooperatives, for instance, might be appealing, but some caregivers would likely not be able to participate in such efforts and would be excluded from the place where collective democratic power over the economy is exercised. A guaranteed basic income would do much to help individuals in general and for people whose work centers around unremunerated care in particular. On the other hand, a guaranteed income alone would still leave many individuals isolated from the process of building democratic, community-sustaining institutions like co-ops. We need to think holistically about such questions, about who gets to participate in different efforts, and how both individuals and community institutions are sustained.

“The Pluralist Commonwealth model holds that not only is a redistribution of work-time possible, but that it is also a necessary condition of democratic participation and of personal liberty – liberty, that is, “to use one’s time as one sees fit.” Please talk about how you see a guaranteed living income and/or job and a reduction of hours worked becoming a reality in the land where workers work the most hours a year of anywhere in the world?

The US economy currently produces roughly $200,000 for every family of four – even with high unemployment, even in stagnation. Viewed differently, this is the equivalent of roughly $100,000 for every family of four - and roughly a twenty hour work week. Technically speaking we have no economic problem; we have a political problem in managing the most powerful economy in the world. A restructured system could move rapidly toward a reduced work week, along with redistributive measures to alter the current radically unequal distributions of income and wealth. Alternatively, individuals might work longer hours, but take the equivalent amount of free time in several-month breaks, during which they could study, learn new skills, take up creative arts, or just vacation. These are not technical problems; they are political problems a serious next system could undertake to resolve if the structures of power that now block solutions were altered.

I’m sending you these questions on Hiroshima Day: how does your activism and scholarship on nuclear issues intersect with the Pluralist Commonwealth?

My work on the bombing of Hiroshima was (and is) one of the things that forced me up against the system problem. We now know that use of the bomb was unnecessary and known at the time to be unnecessary. Most of the highest-level US generals and admirals (including President Eisenhower, and even hawks like Air Force General Curtis Lemay) went public after World War II criticizing the bombing as totally unnecessary. To ask how a nation and its leaders could in such circumstances knowingly come to a decision to destroy roughly 300,000 people, almost all of whom were the elderly or children who stayed at home while the young men were at war, is to ask some of the most disturbing questions about the nature of the current system.

The bombing of Hiroshima cannot be understood without clear recognition that it was in many ways the culmination of a development over almost two centuries of a system based on expansion – first, the taking over of an entire continent; second, the extension overseas of economic and other strategies aimed at the control of markets and raw material. Along with this came the development of an ideology, a genuine belief that what was being done was also helping support democracy and freedom around the world. Yes, based on corporate interests, but also - and this is what made it truly powerful - based for many on a genuine belief that this was helping save the “free world.”

Space does not permit a full discussion, but ultimately the use of the atomic bomb was intimately related to a belief that what was being done would both end the war and further such a vision against the challenges raised by the Soviet Union and others who disagreed with the premises of the global “free world” democratic capitalist system US policy promulgated. (For more on this see my book, The Decision to Use the Atomic Bomb, and the Introduction to my “Cold War Essays”.)

You’re on the advisory board of the intentionally optimistic Yes! Magazine and have worked apparently tirelessly for justice for over 50 years: How do you maintain your energy and hopefulness – I would even say, optimism?

Part of what keeps me going is respect for what others have done in difficult times; part derives from history. Some people believe that they contribute only if they can see the positive result of their action, now! My heroes are the unknown civil rights workers in Mississippi in the 1930s and 1940s who worked for change against great odds and in great danger (many were hung, often after being tortured). Their work laid the groundwork for what came later, in the 1950s and 1960s – and was just as necessary and just as valuable (if not more valuable) than efforts of those who happened to be born at the particular moment when they could see the results of their work for change.

Again, look at Chile: It would have been easy, once Pinochet took over, to assume that was the end of history. It would also have been wrong. What was true was that going through the dark, dark moment was not the end, that new possibilities could develop beyond the dark moment. (A good point to keep in mind as our own civil liberties decay, perhaps.)

There is no way to truly know the future. The easy path is to assume nothing can be done, the odds are too great. We all have a vested interest in pessimism: If you believe nothing can be done, you are off the hook, no responsibility.

In the end, I chose for possibility, for building forward, and then seeing what happens. The alternative is certain failure.

That said, my own deeper analysis of the emerging historical context suggests many reasons to believe that the steady development of a profoundly serious movement for change is highly likely, given the system’s failings. And that such a movement is likely to go beyond traditional activism to much deeper questions. (See Parts I and VI of my recent book, What Then Must We Do: Straight Talk About the Next American Revolution.)

In the speech on your website, you refer to a broken system that will change neither through reform nor revolution, but through what you call evolutionary reconstruction, which as I understand it, should allow correction of the inevitable unintended consequences that come with planning and markets and democratization of ownership? Please explain how scale considerations factor into this scenario.

There are really two parts to your question, so two answers: (1) “Reform” – as in liberalism, for instance – assumes that the existing corporate capitalist system will continue and that the task is to clean up around the edges; tax, spend, regulate (if you can), but don’t assume you can change the underlying system’s core institutions. (2) “Revolution,” means you change the underlying system and its core corporate capitalist institutions; usually the term also implies a violent overthrowing of power. I suggest there is a third possibility: (a) Yes, we do mean changing the underlying core institutions; but (b) No, not necessarily by a violent explosion. “Evolutionary reconstruction” involves the laying down of institutional structures, step by step, in diverse areas to steadily build a mosaic of democratizedownership - and also to steadily develop democratic ownership as an idea, indeed, an idea whose time has come (in Gramscian terms, to crack the hegemomic ideology). Thus: worker-owned firms, land trusts, state banks, municipal takeovers, maybe nationalization next time the big banks and General Motors go down (or the time after), etc, step by step over time, as the pain worsens and more and more people realize that something different must be done. What may happen if and when such foundations are established over substantial periods of time is indeterminate, but the process involved in the here and now is different from either of the traditional models.

Such a process can also help correct some (not all) of the problems of markets and of planning, above all because it builds a new culture. To really answer your question, however, I’m afraid would require more space than we have. (The planning section of the website might possibly be of interest.) As to the question of scale: It is very, very difficult to imagine anything like meaningful and participatory democracy in a Continental scale system of over 300 million people. We rarely talk about how huge and inherently undemocratic our Continental scale system is: You could tuck Germany into Montana!  William Appleman Williams, the great radical historian (as well as many others, left and right, during the 1930s) urged that ultimately we will have to regionalize the system if we hope to have anything like meaningful democracy. I think he was right – and that any serious movement needs to begin considering what this means. (In my experience people find it easier to talk about overthrowing capitalism than they do about regionalizing the national system as the only way to achieve real democratic control – so it’s a very challenging issue!)

“Why do you hold that it is important to have a vision of where we want to go? Isn’t it enough just to fight back against all of the outrageous things that are happening?”

I think the absence of a coherent vision of where we want to go has been one of the most important limiting factors that has constrained movements for change in many, many situations and countries. At the end of his life, Martin Luther King Jr. recognized this explicitly: Most of what the civil rights movement was about – as was also the case for the feminist and gay rights movement – a demand for equal treatment in the existing system. (There were of course exceptions in all three movements, but the people who saw the need for broader systemic change were rarely the dominant voice in the national conversation). When the civil rights movement began demanding economic change, it came up against levels of power far greater (and more sophisticated) than the crude violence of the South. King understood that there could be no answer just getting into the system. What was needed was changing the system (to what he called some form of democratic socialism).

But if changing the system is what is required – and I agree – then it is incumbent on those of us who call for this to say what we mean. The truth is most people have been very vague or rhetorical about what they want, so for the most part they have little more than rhetoric to offer. Thankfully, we have seen the beginnings of some very serious discussions of what, specifically, a next system that you might want to live in might look like in recent years. It is a very positive sign: We are approaching the point where we might actually be able to say something clear and understandable in answer to the very reasonable question: “What specifically do you want? And why, specifically, would it be better than what we now have, or, for instance, better than the “socialism” of the Soviet era?” The www.pluralistcommonwealth.org site is an attempt to track some of the answers to these questions that I have been working to develop for the much of the past half a century.

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Is Worker Ownership a Way Forward for Market Basket?

Originally published on Truthout.

The Market Basket situation is indeed, as many commentators have remarked, nearly unprecedented in the annals of American labor relations: When have we ever seen so many workers protest so vigorously for, rather than against, their boss! (For those new to the story, the New England supermarket chain has been wracked by massive employee protests, organized without any union involvement, after a faction of the family that owns the chain took control and ousted extremely popular CEO Arthur T. Demoulas. The mobilization in support of the former chief executive has resulted in nearly empty shelves and the mobilization of angry communities of formerly happy customers.)

But beneath the surface of the singular job action, in which workers and community have banded together to demand the reinstatement of the former CEO, the conflict in New England points toward something much more fundamental: the need to build institutions that can sustain the kind of community- and worker-friendly business leadership that earned “good brother” Arthur T. such incredible loyalty.



Happily, such institutions already exist, here in the United States. While undoubtedly not perfect as a form of workplace democracy, the Employee Stock Ownership Plan (ESOP) offers a proven template for making the interest workers have in a thriving business part of the discussions about a company’s future. As Market Basket demonstrates, lovable CEOs who treat their workers well are wonderful – until someone else takes their place. With millions of Boomer bosses set to retire in the coming years, a transition to employee ownership – with the attendant tax breaks it offers to business owners – is an attractive and sensible option that allows a culture of community and sense of mission to outlast changes in the person sitting in the chief executive’s chair. And selling to your employees doesn’t mean immediately handing over the reins: As examples like the employee-owned brewery New Belgium or the publishing house Chelsea Green show, a transition to employee ownership can keep the leadership that built a company’s culture in place, while simultaneously laying the groundwork to maintain that culture for the long haul by rooting ownership in the company itself.

Interestingly, regional supermarket chains like Market Basket seem particularly well suited for this kind of democratized ownership: The National Center For Employee Ownership estimates that at least 300,000 American supermarket workers are also owners of their workplaces. Take Boise-based WinCo Foods, for instance: Its nearly 15,000 employee-owners enjoy generous health-care benefits, high wages and a large stake in the company as retirement savings, with the company itself able to operate so effectively and efficiently that it beats Walmart on prices – something much appreciated by the communities the business serves. On the leading edge of food cooperative development, such mutually beneficial relationships between fairly treated workers and satisfied communities of consumers are being taken a step further and made explicit in so-called “multi-stakeholder cooperatives,” like Weaver Street Market in North Carolina, where 185 workers and 18,000 consumers democratically co-own a chain of groceries with more than $30 million in annual sales.

With approximately 6 million more worker-owners than private-sector union members in the United States today, this kind of democratized ownership is not a marginal or niche approach. While unions are an excellent tool to protect workers from the abuses of bad bosses, it’s less clear how well-suited they are to protecting good bosses from the abuses of stock owners with no long term stake in the future of the community. Indeed, many unions seem to be recognizing that they need to be ready to help workers on both fronts: UFCW, for instance, recently negotiated the conversion of the Homeland grocery stores in Texas and Oklahoma to 100 percent employee ownership, with a significant seat at the table for the company’s 15,000 employees in the management of the business and with the union’s involvement guaranteeing that the deal was a good one for the workers. If such democratized ownership and workplace co-determination is possible in some of the reddest of the red states, surely it’s possible in New England!

Ultimately, whether or not an ESOP conversion makes sense in the current no-holds-barred battle raging around Market Basket is difficult to say from a distance – the situation may have changed significantly before this piece even appears. But there can be no doubt that in the long term, an employee-owned company would provide a much better solution for the workers and larger community than the current mess.

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America Has a Scary Sewage Problem: Let’s Clean It Up and Jumpstart the Economy While We’re At It

Originally published on Alternet.

The problem is simple, surprising, and quite honestly disgusting: Our nation’s older cities depend largely on sewage treatment systems that overflow when it rains, dumping 860 billion gallons of raw sewage a year into “fresh” water across the country—enough to cover the entire state of Pennsylvania an inch deep.

This problem is very, very real for people like Lori Burns in Chicago, whose basement full of sewage and “climate change maggots” recently found its way into the Washington Post. Or for the people of Toledo, where a chronic “combined sewer overflow” problem has combined with runoff from industrial agriculture to drastically alter the ecological balance of Lake Erie, with toxic algal blooms making the city’s drinking water poisonous.

But the stormwater crisis is also a tremendous opportunity to move in the direction of a new, community sustaining local economy.



Traditionally, the solution to keeping sewage out of our rivers and lakes involves capital-intensive expansion of sewage treatment capacity—or even rebuilding these systems altogether to separate out waste from stormwater. Even in the face of strict consent decrees imposed by the EPA, it’s highly improbable that our most cash-strapped cities are likely to be able to find the funds—estimated at over $100 billion nationwide—to sufficiently rebuild their underground infrastructure; in metro Washington DC, this requires 23-foot wide tunnels.

As climate change continues to generate bigger storms and more intense flooding to the point that even insurance companies are beginning to sue cities for inadequate drainage capacity, can we find a way forward?

Happily, new methods of stormwater management are increasingly recognized as compelling alternatives to burying bigger and bigger pipes under our city streets. In green stormwater management, rather than scaling up overtaxed sewage pipes, the point is, wherever possible, to prevent runoff from entering the system in the first place. A rain garden with native plants captures water running off roofs and channels it into the soil, not the streets. Permeable paving does the same for traditionally impervious parking lots.

By reworking the urban environment along ecologically sensitive lines, the green stormwater management toolbox—which also includes urban forestry, green roofs and artificial wetlands—provides an effective way to lighten the load on our sewage systems, while reducing the pollution associated with runoff—not to mention sprucing up our communities with more plants.

But jobs–and new principles of systemic and institutional design that can be implemented in the creation of those jobs—are the real reasons to be encouraged by green stormwater management. Legal pressure from the EPA forcing many local governments to fix their stormwater problem means that, ultimately, stormwater work is being driven by public money, whether directly when that work is done on public lands and streets, or indirectly when the work is incentivized elsewhere to help reduce the total amount of water flowing into the public sewer system.

There’s an opportunity to demand that when public money is spent, it is spent in ways that maximally benefit the public. That means we can also use the stormwater crisis as a real opportunity, connecting public money with “high road” strategies to create much needed jobs—and when possible, develop new forms of democratic ownership.

Green stormwater management has unique advantages: it’s much less capital intensive than the traditional approach, and because it relies on living systems, it helps establish a market for continuous skilled maintenance. Moreover, because it relies on many decentralized small projects, it opens up the space for experimentation with different approaches to create jobs building the needed infrastructure—and at a scale amenable to community ownership and control.

PUSH Buffalo and the Partnership for Public Good’s recent report “Building the Blue Economy” lays out in detail many possible models for such experiments in job and new institution creation, including PUSH Buffalo’s own PUSH Blue initiative—where stormwater projects are being pursued in a targeted geographic area, together with weatherization and other sustainability work. The goal in this “Green Development Zone,” located within—and built with the support of—a low-income community, is to help align multiple economic development projects with long-term organizing for economic equity and sustainability.

Our team at the Democracy Collaborative has also been involved in a project in the Washington, DC metropolitan area that’s taking advantage of the opportunity presented by the stormwater crisis—in this case with an eye to explicit cooperative/community ownership. The first company to launch in the regional Community Wealth Building Initiative will be an employee-owned, green stormwater maintenance and monitoring company located in neighboring Prince George’s County.

The nationwide possibilities are vast, both in terms of the scale of resources that are going to be made available for green development, and in terms of how well suited this particular industry is to providing entry-level jobs for residents of marginalized communities in a tight jobs market.

There are certainly challenges that need to be addressed—the fact that stormwater jobs create low-skilled work for people who need them most now also means that many of these jobs don’t present a clear career ladder. Nevertheless as techniques for green stormwater management are increasingly refined—both Philadelphia and New York City have launched credible large-scale initiatives—and the strategies for capturing the maximum economic benefit for low-income communities are fine-tuned, there are likely to be increasing possibilities for developing further, more advanced jobs as time goes on.

Billions in public money is being spent to deal with stormwater already, with tens, if not hundreds, of billions more all but certain over the next decades. The crisis offers an opportunity not only to create a sustainable infrastructure, but a path to increasing numbers of jobs requiring higher skills rooted locally in new community-building institutions. Not only can such jobs meet an immediate and pressing need in our nation’s urban communities, but the patterns learned and reinforced—solving social problems at the lowest appropriate scale in the interests of both decentralization and efficiency, leveraging the natural world rather than circumventing or ignoring it, and using public money to bootstrap cooperative and community-based enterprises that can multiply the social benefits realized—can provide hands-on training in principles that will serve us well in the larger and ever more pressing green economic transition.

The post America Has a Scary Sewage Problem: Let’s Clean It Up and Jumpstart the Economy While We’re At It appeared first on Gar Alperovitz.

The Cooperative Economy: A Conversation with Gar Alperovitz

Published in the May/June & July/August 2014 issue of  Orion  magazine

IN THE MID-1960s, when author, historian, and political economist Gar Alperovitz was working as legislative director for Senator Gaylord Nelson, change was in the air. Ink had dried on an early version of the Clean Air Act, the civil rights movement had won major victories, and the first Earth Day was in the works. The U.S. still faced plenty of serious challenges, but many Americans felt their country was capable of dealing with them successfully.

Today, things feel very different. “From climate change to a medieval level of wealth disparity, what we face in this country is no longer a regulatory crisis,” says Alperovitz. “We face a systemic crisis. And if you begin there, you begin to wonder: Is capitalism itself in profound trouble?”

Alperovitz believes it is. The author of several books on the subject, including America Beyond Capitalism, and a professor of political economy at the University of Maryland, he points to capitalism’s increasing dysfunction as the impetus for the rise of another economy, one built from the ground up by democratically owned organizations like cooperatives, community land trusts, and municipal institutions.

Orion editor Scott Gast spoke with Alperovitz after the publication of his most recent book, What Then Must We Do?: Straight Talk About the Next American Revolution, which explores whether the cooperative economy can provide the seeds for a system that isn’t capitalism and isn’t socialism, but something entirely new.

***

SCOTT GAST: You’ve been thinking, writing, and speaking about alternatives to capitalism for a long time. Where did your interest in cooperatives begin?

GAR ALPEROVITZ: My interest began back in 1977, when a big steel company, Youngstown Sheet and Tube, went out of business. Five thousand people in Youngstown, Ohio, lost their jobs in one day, which was disastrous. Layoffs of that size are common today—especially when multinational corporations shift capital around—but in 1977 that was front-page, national news. It was a big, big deal.

But the community leaders and steel workers in Youngstown decided that they didn’t have to go down without a fight. They got together and built a coalition to buy the steel mill back and run it themselves, under worker-community ownership. They began organizing locally and statewide, and soon the Carter administration agreed to provide funds to hire experts who could help them with the mill’s technical designs.

Things were looking up until the mid-term election of 1978, after which the Carter money disappeared and the project fell apart. It was a serious blow—but everybody involved in the coalition knew it might happen. They understood that part of their job was to educate people about this alternative form of ownership, because what happened in Youngstown was going to happen to other communities, and at some point, they might win the battle. So they launched an educational campaign throughout Ohio, and they began talking about worker and community ownership as a means of rescuing cities and towns from decay.

So even though the Youngstown experiment failed, it succeeded in a much larger sense: Some thirty-five years later, there are now a great many worker-owned businesses in the state of Ohio, and the support system for building them is one of the best in the nation. We don’t know the exact number, but very large numbers, per capita, in Ohio, are traceable to this education effort.

SCOTT: What exactly is a worker-owned company? What makes them different from conventional businesses?

GAR: A worker-owned company, or cooperative, is essentially a one-person one-vote, member-owned and -controlled economic institution or business. Included in the American cooperative experience are agricultural co-ops, insurance co-ops, food co-ops, housing co-ops, health-care co-ops, artist co-ops, electrical co-ops, credit unions, and many more. Large retail co-ops many Americans are familiar with include REI, the outdoor clothing and supply company, and ACE, the hardware-purchasing cooperative.

The modern cooperative form is often dated back to the Rochdale Society of Equitable Pioneers founded in England during the 1840s, although other cooperative economic arrangements have existed throughout human history. At roughly the same time, in the United States, cooperatives were being formed by both the National Trades’ Union and the associationist movement. And many farm co-ops date from the 1930s and the New Deal.

But aside from being owned by members rather than by shareholders or individuals, cooperatives differ from many traditional businesses in their values and motives. Also, they’re not required to grow, but they can and do, which is important in terms of designing an alternative to capitalism, because we need to get beyond the existing economy’s drive to use resources and produce waste, including carbon emissions, in ever-increasing quantities.

SCOTT: Does worker and community ownership exist in forms other than cooperatives?

GAR: Yes, these institutions come in several varieties—from employee stock ownership plans to municipal enterprises and community land trusts.

In employee stock ownership plans, voting rights are retained by a trust, not by the workers. These organizations commonly create worker ownership via special tax incentives given to the companies’ heads, who then decide to sell the company to their employees. These are by far the most prevalent form of worker ownership in the United States; there are now roughly eleven thousand of them. More than 10 million people are involved as owners in virtually every sector; some firms are very large and sophisticated, such as Publix Super Markets, while others are more modest in size.

Municipal enterprises—or businesses owned by local governments—are a larger-scale form of democratized ownership. Local governments often operate utility companies, help build telecommunications and internet infrastructure, and invest in mass transit. Increasingly, city governments have turned to these enterprises to promote local jobs and economic stability.

Land trusts are a third form. Essentially nonprofit corporations, they own housing and other property in ways that prevent destructive gentrification and support low-income housing. In 2012, 255 community land trusts were operating in forty-five states and the District of Columbia.

SCOTT: You mentioned earlier that, in the wake of the Youngstown Sheet and Tube collapse, there are a great many worker-owned companies in Ohio. Can you describe one of them?

GAR: In Cleveland’s Glenville neighborhood—which is a poor, mostly black neighborhood with high unemployment and an average income of about $20,000—there exists a complex of worker owned companies called the Evergreen Cooperatives.

Evergreen is not a collection of small co-ops; these are significant scale companies linked together with a nonprofit community corporation, and they employ many local people. The largest urban greenhouse in the United States, Green City Growers Cooperative, is one of the companies in the complex, and it’s capable of producing 3 million heads of lettuce a year, plus other greens. There’s also Evergreen Cooperative Laundry, which is an industrial scale laundry serving hospitals and nursing homes in the area; they’re housed in a LEED-certified building and use about a third of the heat and a third of the water of ordinary laundries. And there’s a solar installation company, Evergreen Energy Solutions, which employs men and women from inner-city Cleveland and recently installed a forty-two-kilowatt solar unit on the roof of the Cleveland Clinic.

But what makes this complex particularly interesting is the way it’s anchored to its community: In the middle of this very poor neighborhood, there are two major hospitals. The Cleveland Clinic is one; University Hospitals, the other one, is attached to Case Western Reserve University. Together, those institutions purchase about $3 billion—that’s billion with a b—in goods and services a year, which, until recently, were purchased almost entirely outside the community. Now, though, they’ve begun to direct some of that purchasing power at this complex of cooperatives.

In this model, those big, quasi-public institutions are called “anchor institutions.” Unlike major corporations, they don’t get up and leave; they’re anchored to their neighborhoods, and they drive the local economy.

SCOTT: Surely, though, those anchor institutions are looking to purchase goods and services at a low price. What’s to prevent a corporation—like Walmart—from moving to the edge of town and undercutting the local cooperatives by selling the same stuff for less? In other words, how can a cooperative economy survive the mainstream market economy?

GAR: Well, in addition to their relationships with anchor institutions, some co-ops are beginning to buy from each other in order to widen and stabilize their markets. For instance, I’ve just been down to Texas, where there’s work being done to build a system of co-ops that buy from other co-ops, which in turn sell to regional public school systems. In general, as these co-op complexes group together, and get more sophisticated, they also become better able to withstand pressure from the market economy.

A stable market also means that growth isn’t a requirement, which is important in terms of environmental sustainability. Usually, it’s fear of instability or being undercut that drives a firm’s desire to grow: if somebody else invests in a new machine that makes things a little bit cheaper than you can, you either invest and grow enough of your market to pay for the machine, or you’re out of business. What that means is companies eat each other up; the winning company displaces the losers, and the losers are thrown away.

SCOTT: But isn’t some degree of competition between companies healthy?

GAR: Absolutely—to a point. But community stability is important too. And the current economy isn’t providing it. Which has been disastrous for many reasons. For instance, Cleveland was once home to more Fortune 500 corporation headquarters than perhaps any city other than New York. Today, almost all of them are gone. The city’s population has gone from 900,000 to under 400,000, all because the economic decision making power was left to corporations, leaving the city vulnerable. It’s a wasteland now—we’ve thrown away the houses, schools, and local businesses for 500,000 people. Which comes with huge carbon costs. It’s even worse in Detroit, where a million people have been forced out. And people don’t disappear; they need houses and hospitals and schools someplace else.

All of this is very, very costly to people and places, which means that there is an incentive, if you do it the right way, to begin stabilizing these communities and their local economies.

SCOTT: What’s going on in Cleveland seems to represent something more sophisticated than the traditional corner-store grocery co-op. These businesses are nurturing a set of ideas as well as providing products and services.

GAR: That’s right. Taken together, these efforts are beginning to address one of the fundamental questions at the heart of our many crises, which is, who controls wealth?

Throughout history, controlling wealth is a big part of controlling politics and, as a result, making decisions about the future. And the richest four hundred people in America have more wealth than the bottom 180 million. So the efforts in cities like Cleveland to change patterns of wealth ownership at small and medium scales, local and regional scales, are very important in terms of building political power. They’re doing it at the neighborhood scale, through cooperative forms, and within an ecologically intelligent context.

In contrast to corporations, which have every interest in cutting costs wherever possible, locally rooted cooperative institutions are inherently responsible to people and place. They give local people a stake in the enterprise, which means that the health of the community comes first. Local people have good jobs, and the land, air, and water are treated with care.

SCOTT: Why are these forms proliferating now? What’s driving the experimentation?

GAR: In a word, pain. Many communities are simply not able to deal with their employment problems. In a city like Cleveland, or in any major city for that matter, the typical pattern for employment is, “Major corporation seeks major subsidies to come into the city, while attempting to avoid regulation wherever possible because it’s costly.” The city’s in a box, because it needs to provide jobs, and so it’s forced to cut corners and make a deal.

Communities need alternatives to these difficult confrontations with corporations. Without them, many are simply decaying, and unless they try something new, things are likely to get worse. And so we’re finding, all over the country, attempts to draw on the experience of cities like Cleveland and its experiment with worker-owned complexes.

SCOTT: What are some examples of this kind of thing—the Cleveland model—at work elsewhere in the country?

GAR: In Boulder, Colorado, there is a major city effort to take over a large electric utility, which up to this point has been run by a private energy corporation. It’s part of an effort to move away from polluting forms of energy and toward solar and other renewables. So far, the successes have been hard fought. Activists in Boulder realized corporate regulation was hopeless, so they’ve helped their city fight for ownership of the utility. They recently won by a large majority in a second referendum and, as a result, are continuing to move away from fossil fuels.

People in Boulder have recognized that attempting to regulate corporations while leaving ownership in their hands also leaves the power in the hands of that institution. But making their utility municipal—which is a form of democratization—gives decision-making power back to the community.

There are literally hundreds of experiments going on at different levels that point to changes in ownership as a way to build new institutions—institutions that emerge from a more locally minded set of values. The Cleveland model is proliferating all over the country—there’s an effort like it in Atlanta, three in the Washington DC area, one in Pittsburgh, one in Cincinnati, a new one in the Bronx. Most people don’t realize that 25 percent of American electricity is provided by municipal ownership or co-ops, and much of it in the traditionally conservative South.

SCOTT: How many people and how much capital are involved in cooperative institutions?

GAR: There are around 130 million Americans who are members of co ops. The credit union sector, which is part of the co op sector, has more or as much capital as any one of the big five New York banks. The nonprofit sector is about 10 percent of the economy. And you can add in employee stock ownership plans, municipal enterprise, and community land trusts.

At a slightly larger level, twenty states have introduced legislation to create publicly owned banks. The Bank of North Dakota, for example, which has been a state owned bank for about one hundred years, puts the public in control of investing, and has been very popular among residents.

All of this is part of a larger movement toward democratically controlled and owned pieces of the economy, which is slowly building new institutions and infusing them with a different culture, ethic, and environmental concern.

SCOTT: If these activities manage to continue, and to keep growing, what’s next? Can some kind of critical mass be reached, at which point an alternative economic system presents itself to average Americans?

GAR: We’re talking about building a foundation of ideas and culture, which can then begin to command political power. That’s what occurred during the time of the Progressive movement, the women’s movement, the populist movement, and the civil rights movement.

There’s also something very American about the bottom-up process at work here. It doesn’t look anything like the old, state-centric European model. It begins instead by asking, What can you do in your neighborhood? What can you do in your city? Can you build at the neighborhood, city, and state levels a whole culture of institutions that sets the terms of reference for the larger order system?

SCOTT: What you’re describing reminds me in some ways of bioregionalism, the idea that human settlements and economies should be scaled according to distinct ecological regions.

GAR: Yes, I think scale is a very important aspect of this. We tend not to remember how gigantic the United States is compared with other countries: you could take the whole of Germany and drop it into the state of Montana. It’s very hard to organize a democratic politics in a system of that scale. Large corporations can dominate the media and dominate the capital city, as we’ve seen.

So the logic does point toward a regional structure of some kind: New England, the Pacific Northwest, the Upper Midwest. Or the state of California, which is itself a giant region. In fact, debates about this took place in the 1930s among liberals, conservatives, and radicals. The Tennessee Valley Authority, for example, began as a regional body oriented around a river system.

Still, though, we’ve got to think at both small and large scales. For instance, in the future, if anybody still wants to fly an airplane to get across the continent, or take a large train, the work of building planes or trains will likely not be done in one neighborhood. That kind of work requires larger, more sophisticated institutions, and we should be thinking about those, too.

SCOTT: Our country’s size, along with its concentration of political power, seems to inhibit progress on all sorts of issues, including climate change. Should we start small, then, and attempt to address that issue community by community, region by region?

GAR: As you’ve probably noticed, my bias is always to start at the smallest scale possible. Ultimately, unless the culture changes from the bottom-up, in a direction favorable to the ecological and community-oriented values we’re talking about—and I think there is movement in that direction—nothing is going to change.

But in terms of climate change, we’ll eventually have to deal with the problem of the giant corporation, because it’s corporate power that’s warped the political system. As we’ve seen, it’s all but impossible to regulate greenhouse gas emissions: corporations make the argument, particularly as the economy worsens, that they can’t sustain the cost of regulation. And so politics fail in this respect; emissions continue to expand.

It’s interesting to note that the economists at the Chicago School of Economics looked at the principle underlying this problem during the 1930s and 40s. The argument was made by the same people who taught Milton Friedman—the famously conservative economist—that in a free market, the power of the giant corporation is simply overwhelming. They are so powerful that they actually distort the market and trample competition. Remember, these were conservatives!

Later economists from the same school of thought argued that if you try to regulate, the large corporations will take over the regulators, because the corporations are more powerful than they are. And, going one step further than they did, we now know that even if the corporations are broken up via antitrust laws, they’ll simply regroup under another name, the big fish will eat the little fish, and pretty soon you’ll be back in the same place—that’s what happened with AT&T and with Standard Oil.

So these economists faced the dilemma directly: If you can’t regulate corporations because they’ll overpower the regulators, and if you can’t break them up, it was argued that the only option left is to make them into public corporations. It’s hard to call Milton Friedman’s teachers socialists, but in fact, that’s what some of them concluded.

In terms of climate change, where corporate power is a primary obstacle to meaningful change, I think we need to face the same answer—return the power concentrated in corporations to communities via public ownership. To get there, we need to build a culture that is less frightened of these ideas, a culture in which people experience, in their own lives, co ops, land trusts, municipal utilities—local, direct, participatory democracy.

SCOTT: Is what you’re describing—the democratization of wealth, beginning at the community level—a kind of socialism? That word, of course, is so loaded these days.

GAR: Well, it certainly wouldn’t be accurate to say that co ops in their current form—democratically owned economic institutions—are socialist entities. But a municipal utility might be called “socialist.” A neighborhood land trust owned by the neighborhood or controlled by a city could be called “socialist.”

So, yes, that charge can be leveled, but the key difference between what I’m describing and what most people think of as socialism is that, with socialism, ownership of wealth and power is traditionally concentrated within the state and its national government. The vision that’s emerging in these experiments around the country is anathema to that. It begins in neighborhoods and communities, in cities and states. It’s about decentralizing power, changing the flow of power to localities rather than to the center.

But I think the old worries about socialist rhetoric come out of the Cold War. The people under thirty who are going to build the next politics over the next three decades are looking for answers; I don’t think they’re much concerned about that old rhetoric. What’s most important is that the answers be practical. That’s what we’re finding. For instance, in Cleveland, the worker-owned complex is giving people jobs and a stake in the future of their communities.

Even conservatives have turned out to be supportive of these local experiments. People forget this, but Ronald Reagan, for instance, was a great proponent of worker-owned companies and is publicly on the record as believing they’ll be an important part of our future.

SCOTT: In your writing and speaking you’ve used the term “evolutionary reconstruction” to describe the work of the next several decades. What do you mean?

GAR: What I’m talking about is the reconstruction of a culture of community in this country. Neither simple reform of old institutions nor “revolution.” And that’s a project that depends not only on local-level work, but also on institution building and long-term cultural change. It’s not just about climate change or any other issue; it’s about re-conceiving ourselves as people who care about the country and want to move it in a different direction. I think younger people get that and understand it instinctively.

Through all of this, we should remember to think of ourselves as historical actors. We are facing systemic problems, like climate change, that are historic in scale. And you don’t change systems without thinking in terms of decades. Remember, big shifts happen all the time in world history: the American Revolution, the French Revolution, even the modern environmental movement. But all of these things were thirty or forty years in development before they exploded. That’s true of the civil rights movement: there were people in the 1930s and ’40s whose names we’ve never heard of who were developing a long-term vision that made possible what happened in the 1960s. Without that kind of a vision, there is no base for a larger change.

Developing a democratically oriented alternative to capitalism can’t be done overnight. This work requires a different sense of time and a deep sense of commitment—the bargaining chips are decades of our lives. But the shifts are already happening in places like Cleveland and Boulder. What we’re seeing is the prehistory, possibly, of the next great change, in which a movement is built from the grassroots that becomes the foundation of a new era.

 

 

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Growth for growth’s sake will kill us all: Moral and ecological truths are challenging economic doctrines

Originally published on Al Jazeera America

One economic fact is held to be self-evident: that the future well-being of the United States requires economic growth — preferably, as much of it as we can muster. Despite wildly divergent policy recommendations, this basic assumption is made clear and explicit by everyone from the fiscally conservative Club for Growth to the left-leaning Center for American Progress. In the boardroom of the Federal Reserve, at the negotiating table for the Trans-Pacific Partnership and on the shale fields of North Dakota, our national economic policy is built on the unshakable conviction that the only way to grow the middle class is to grow the economy — by any means necessary.

Aside from the fact that the top 1 percent has taken most of the gains of growth, leaving the rest of society in virtual stalemate for three decades, there is a profound problem with this solution. Indeed, it’s time to face an ecological truth that makes the traditional assumption increasingly untenable, as unpopular and difficult as this conclusion might be: Growth isn’t always possible. Nor is it necessarily desirable.

Growth is good?

For the generation that came of age in the post-WWII period, the “growth is good” assumption made perfect sense. And why wouldn’t it? The period between 1946 and 1973 saw the emergence of an “American dream” that was characterized by a robust middle class and accompanied by an annual increase in real GDP that averaged close to 4 percent. But as growth began to slow in the 1970s, our national economic politics began to split in two, with the vestiges of the Keynesian liberal consensus, which favored government involvement in the economy, clashing more and more frequently with a nascent neoliberalism that supported free-market policies. The systemic problem posed by long-term stagnation has been masked by the spectacle of Washington politics, where everything seems to come down to conservatives animated by laissez-faire fantasies and the rearguard liberal defenders of a crumbling social safety net fighting each other to a perpetually dramatic stalemate.

Even if this particular ideological logjam were to suddenly and unexpectedly clear, the case for unrestricted growth is not convincing for other reasons — in particular, environmental ones, as the new report from the U.N.’s Intergovernmental Panel on Climate Change makes clear. The heat waves, droughts, floods and other harbingers of a changing climate catalogued in the report continue to multiply, and governments are now forced to get serious about adaptations to the world our carbon-fueled economy has produced. Yet so far a serious conversation about reducing emissions remains politically impossible. Despite the head-in-the-sand antics of “skeptics,” climate change is real, and economic growth, even at today’s historically depressed levels, is a major factor.

Other studies suggest we are approaching real limits to the availability of numerous basic resources necessary to economic advancement. No technological quick fix is going to change the fact that our finite planet has definite limits. And the more we grow, the more we begin to trip over them, in an increasingly chaotic and interconnected fashion. The energy business and its deleterious impact on the environment are only the most obvious of many examples: The trajectory of the hydrocarbon industry toward costly and carbon-intensive tar-sand extraction and extreme deep-water drilling now makes “sense” from the perspective of a market that has exploited most easily available energy deposits and ignores the consequences of its actions with impunity. Meanwhile, hydraulic fracturing, or fracking, is pouring more carbon into the air while depleting dwindling aquifers and destroying the very rock formations that some had hoped might be available to sequester excess carbon. The planet cannot sustain this type of growth, but the economy, we are told, commands it.

 A rising tide used to lift all boats, but now it just drowns our cities.

This is a problem. Our national political debate is so constrained that accelerated growth is presumed to be the necessary precondition for broad prosperity. We’re told the only way to help the 1 in 6 Americans living in poverty is to keep enlarging the pie until everyone has a big enough slice. But is this worth it if we lose Miami in the process? A rising tide used to lift all boats, but now it just drowns our cities. A genuine alternative instead of attempting to press beyond the limits we face would distribute the fruits of our technological and economic prowess away from those at the top and toward the vast majority.

Turbocharged

Moreover, it’s unclear — even if we decided the benefits of turbocharged growth outweighed the very real ecological risks — that it would be possible. As Thomas Piketty’s new book “Capital in the Twenty-First Century” amply demonstrates, the era of 4 or 5 percent growth in the developed countries was a historical exception, and we’re likely to be heading back to an era characterized by slower growth and steadily increasing income inequality. In other words, we need to rethink our political strategies for an economic situation likely to be dominated by stagnation and decay.

Traditional economic policies, both left and right, assumed that growth could drive robust progress toward a more equal society. Take the so-called Treaty of Detroit. The labor movement’s historic post-WWII compromise with capital traded the productivity of a disciplined workforce for the promise of the steady growth of a blue-collar middle class. A look at today’s Detroit, of course, shows to what extent that treaty has been definitively broken. The promise of stable, high-wage manufacturing jobs has given way to a city where unemployment is over 18 percent and 4 in 10 people live below the poverty line. Meanwhile, the new automobile manufacturing jobs being created are precarious, low-wage positions, not pathways to middle-class economic security. Consequently, what meager growth there is no longer brings with it a guarantee of broad prosperity.

Aggressive growth is impossible ecologically and implausible economically. We need economic strategies at the local, state and national levels that prioritize community benefit over corporate gain, and which presume a need for local resiliency instead of depending on uncontrolled growth. We also need to develop new strategies to democratize wealth in the face of extreme inequality. Like the programs developed in “the state and local laboratories of democracy” that led to the New Deal, numerous experiments percolating across the country in the “new economy” — building cooperative and community-owned businesses, developing locally focused supply chains at a municipal and regional level, building new forms for public ownership of essential services like banking and power generation — may just point the way. The end of growth poses a long-term systemic challenge, and such explorations suggest that a new direction may be quietly being explored in the midst of economic and ecological degradation. It is a direction that is likely to accelerate as economic and social pain of the decaying economic system continues to force Americans to explore solutions that take us beyond the tired nostrums of the past.

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Podcast: Interview with Disorderly Conduct’s Jesse Myerson

Alexis Goldstein and Jesse Myerson host “Disorderly Conduct,” a podcast dedicated to making economic and financial news accessible. Gar Alperovitz spoke with Myerson for the program’s April 29 edition about the features of an alternative to capitalism: the Pluralist Commonwealth.

Listen now:

Download this segment

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In conversation with Michael Albert

An abridged version of the following conversation with Michael Albert, developer with Robin Hahnel of  the participatory economics model or “Parecon” appeared on Truthout.

MICHAEL ALBERT: Participatory economics proposes a small set of institutions that define the heart of a new type of economy. These institutions are conceived to further various values: self-management, solidarity, diversity, ecological sanity. The idea is that as you carry out economic activities—in other words, as you produce and you allocate and consume—you simultaneously accomplish not only those functions, but by virtue of what the institutions require of us as we operate, you also advance those values.

The basic institutions that are meant to accomplish this are few. There are worker and consumer self-managing councils; where self-management means that people should have a say in decisions proportionate to the degree they are affected by them. There is equitable remuneration—referring to the share we get in the economy in the form of income, our claim on the social product. Under participatory economy these are in proportion to how long we work, how hard we work, and the onerousness of the conditions under which we work. There is also what’s called balanced job complexes, which is a way of organizing the tasks that we do, so that our work lives, our economic activity and production, has a comparably empowering effect on us all. Finally, there is an allocative system to apportion work, labor and effort—the goods and services we produce—that isn’t a market or central planning but is something we call participatory planning. So in a nutshell, that’s participatory economics (http://zcomm.org/category/topic/parecon/).

GAR ALPEROVITZ: Even though I disagree with many aspects of Michael’s model, what I like about it its rigor and clarity. Parecon is a very tough-minded economic vision and model and it sets a standard for us to look at.

One place to start (with my own work) is that—given the specific historical conditions we face in the United State—I’m primarily interested in the question of how we begin to move in the direction of a model that realizes the kinds of values that Michael just laid out though is different in structure. I am interested in the political economy of institutional power relationships in transition. The question is one of “reconstructive” communities as a cultural, as well as a political fact: how geographic communities are structured to move in the direction of the next vision, along with the question of how a larger system—given the power and cultural relationships—can move towards managing the connections between the developing communities. There are many, many hard questions here—including, obviously, ones related to ecological sustainability and climate change.

I’ve called the model for what this might plausibly look like in practice “the pluralist commonwealth”: commonwealth because it seeks transitionally to restructure political reality by democratizing the ownership of wealth, pluralist because it embraces a variety of institutional approaches towards that end. The model includes some planning, a great deal of decommodification, and partial use of markets in certain areas. It adheres to the principle of subsidiarity, meaning we decentralize as far as possible to the local level where direct democracy is truly possible, but we are also not afraid to look towards institutional forms like regional or national public ownership when the problems are best solved at those scales…

More broadly, it’s a community-centered vision, starting with the questions “How does the community I live in begin to restructure? What are the next steps that could move us towards a larger egalitarian, democratic, and ecologically sustainable culture?” As we move towards the pluralist commonwealth, economic interventions that stabilize communities–for instance by localizing the flows of goods and services, or by promoting worker ownership–not only have immediate practical benefits, but provide the necessary preconditions for the growth and development of a renewed culture of sustainable democracy that can serve as the basis for still further transformations at larger scales. But the model is designed to make maximal use of actual on-the-ground forms of democratized ownership–the millions of employee-owners, the thousands of community development corporations and cooperatives that already exist in the US serve as a key starting point.

Importantly, the focus is on transitional forms, not on ultimate theoretical final states. A full description of the model, its elements, and many of the challenges that come up in connection with the approach is available at:www.pluralistcommonwealth.org

 

On Experimentation and Possibility

MICHAEL ALBERT: I appreciate in Gar’s work the emphasis on being attentive to what is possible now. We don’t go out in the streets trying to do things that can’t be done. In the context in which we find ourselves seeking ideal relations now, as if they can be had over night, doesn’t make a lot of sense.

I think where we may have a difference, is on the importance not only of addressing what’s possible now, but also whether or not this leads where we want to go—which to me means that we have to have some understanding of where we’re trying to go. So for instance, Gar mentioned that his understanding of the future would include some markets. Well, if we mean the same thing by “markets” (people use the term in all sorts of conflicting ways), then I would probably disagree. Markets are a form of allocation that I don’t think a good classless self-managing society can have, and have it be consistent with those kinds of values. Now that doesn’t mean that you can just say: no markets tomorrow. That’s the part I agree with Gar about.

GAR ALPEROVITZ: Here’s how I think about it. We need to remember the importance of learning and experimentation—you can’t really know what’s going to happen. For instance, if you take control of a workplace, there are a lot of different ways in which a workplace can be controlled. And since nobody knows enough about what all the effects are going to be at large scale, with really significant social change, I think we should try to do some of this piecemeal.

I think that Michael’s projection is utopian in the best sense of that term; I don’t see that as a negative. It’s where we might be when we get to where we want to be. But I think, both as a historian and as an economist, that the problem is quite different from that: how, in the specific historical condition of the United States today, do we move towards a more egalitarian society, one that transforms the ownership of capital, one that builds and nurtures community and that is ecologically sustainable? Lay three or four decades on the table: how do we move towards these larger goals?

So I’m much more interested in an evolving and reconstructive approach that reconstructs community, changes power relationships, and also moves towards some kind of planning. Not just allocative planning, but, in a society of 300 million, large-scale geographic planning to stabilize communities. I come from Racine, WI, a city of about 100,000. The rug was pulled out from under the economy there: industries moved out, all driven by the capitalist relationships dominant in the marketplace. What would be ways to stabilize economies, stabilizing the health of communities so that we can build constructive kinship and other relationships of democratic participation in them?

MICHAEL ALBERT: I agree we need to experiment—but I would say, for instance, we have been doing this for, conservatively, a couple hundred years, and some things we have learned. We may not know all the different options various kinds of workplaces will adopt, from country to country, from locale to locale, etc. But we do know that some very few things need to occur if people in those workplaces are going to be free to decide what they want.

What participatory economics is saying about economic life and what participatory society is saying more generally about the other realms in life is that there are a few institutional choices that really aren’t particularly optional. We can’t have private ownership of the means of productions and vast corporations and make believe that we’re going to have self-management for everybody. In the political sphere, you can’t have a dictatorship and make believe that you’re going to have public participation, freedom, and self-management and justice. Those institutions are contradictory.

So participatory economics doesn’t say that all workplaces will look alike. It does say, however, that we need to apportion work in such a way that 20% don’t dominate 80%. That should be a truism, basically.

GAR ALPEROVITZ: Let me clarify several different points in agreement and disagreement. I don’t disagree in principle with Michael: finding ways to organize work in which people are not locked into power relationships of the kind he’s talking about, is very important. Having said that, it’s not easily done, and it’s complicated.

For example, I was just out at Isthmus Engineering in Wisconsin, a worker-owned company that was in Michael Moore’s Capitalism: A Love Story. It is a real high-tech, very advanced scale, robotic building worker-owned cooperative and nobody in their right mind in that place wants to be the power player. You’d think somebody would want to take control of the damn thing. Not at all. No one wants to be in charge. So what do they do? What they do is hire a manager who wants to do that, subject to the recall of the workers themselves. And they regularly recall them, when they don’t like what they’re doing. So how people actually in the practice of the workplace want to allocate different roles becomes extremely complex.

 

What Must Be Done?

GAR ALPEROVITZ: I don’t claim to have a sophisticated view of how transitions might take place in the specific conditions facing other countries, but I do think a lot about the United States. Here, we need to develop community-wide structures of democratic ownership, we need to work out cooperative development, we need to work out participatory management, we need new ecological strategies developed at the local city, state, regional level. We need to go forward in nationalizing several large corporations: I think that’s possible, we nationalized General Motors, we nationalized several of the big banks, de facto, we nationalized Chrysler, we nationalized AIG. I think there will be more crises, and at some point rather than being bailed out by the government, the public may keep the corporations it has to rescue.

We’re talking about democratizing the ownership of wealth, or socializing in some form. I think that needs to be a pre-condition in any of the systems we’re talking about. The model that I call the pluralist commonwealth incorporates a variety of these strategies, not simply worker ownership—though I do put a great deal of emphasis on worker-ownership and workplace democracy. But that’s only one form of democratizing ownership. There are also, for instance, city-wide models. In Colorado, we just had the takeover (“municipalizing”) of the electrical utility. That’s city-wide, geographic ownership of the means of production, it’s democratic ownership. There are 2,000 public utilities which could become the basis of a whole municipal scheme or strategy. Several hundred cities own hospitals. A number of the states already are moving toward ownership of state banks; many already own chunks of other businesses. Most people are simply unaware of these developments, or of models like this where we already can see expanding public ownership through municipal and state ownership. These are geographic ownership structures, that point for larger scale entities towards regional or national forms of public ownership.

The Pluralist Commonwealth model aims at steadily beginning to develop the institutional substructure necessary for future larger changes, but also that begins at the level of an ordinary community re-orienting itself. I think the appropriate near term trajectory of change we’re working with is 30 years, that’s a timeframe that’s reasonable for developing participation to the degree possible, ecological sustainability, reconstruction of community, laying groundwork for a reconstruction of a non-growth system over time. Beyond that timeframe other things may be possible…

MICHAEL ALBERT: You mention nationalizing, and it could be a good thing or a bad thing. It can be a good thing if it’s moving us in a good direction and a bad thing if it’s moving us in a bad direction. That seems pretty obvious. But if we look at it over time, we have lots and lots of instances that are not good, that don’t move us in a positive direction.

What characterizes positive direction? What characterizes it is more and more people having a more and more appropriate level of say over their own lives. What characterizes it is more and more people getting a fairer and fairer share of a social product and getting a fairer set of burdens they have to fulfill to be a part of society. If we can agree about that, we can make demands. Right now in the present, we can demand changes in the minimum wage, changes in the wage structure in a particular firm, we can demand new budget items in our national or local budget. But to do these things and much more in a way that moves us forward, our approaches now have to create an infrastructure that will stay with us and aid us rather than be corrupted and hurt us in the future. And they will have to develop more and more movement, and more and more activism because people are liking them.

There’s a resistance, it seems to me, about saying something about what we want, as if doing so would cause us to trample real and desirable options. If we say we don’t want a division of labor that would put 20% above 80%, somehow that’s going to cause a problem. If it doesn’t cause a problem to agree on that, and agree that it ought to be part of what we are seeking, let’s just say it and move on. If we say that we don’t want people to own the means of production and who get their income in the form of profit, if we don’t want that because that makes class division, crushes solidarity, demolishes dignity, and creates skewed income distribution, then we should just say it. That isn’t going too far. It’s not extrapolating so far into the future or into details that it somehow restricts us. On the contrary, it can help orient us.

We have to think about how to make demands and how to build structures that are part of the trajectory of change that takes us where we want to go. But that means we need to know something about where we want to go, as well as where we are at and what’s possible right now.

GAR ALPEROVITZ: For 40 years, my argument has been that democratizing ownership of wealth has been the key to egalitarian society and the goals of egalitarian society. That’s what I’ve been writing about, that’s what I’ve been experimenting with, that’s what I’ve been developing, and that’s what the vision of pluralist commonwealth is all about. But you start at the local level, both at the workplace, community and other institutions and you reconstruct the egalitarian democratized structure as well as participatory structure. That is where the learning takes place. You learn to do it in one community and it may be possible to spread to another community if you have achieved anything of significance. And as this happens, we learn more how to move towards the vision that is much larger than just the community level. That’s the whole strategy of what we’re doing in the current phase of development. Beyond this, if the work is done well, further things may be possible.

That doesn’t mean there isn’t an absence of fear that bad dynamics are going to emerge. For instance, worker-owned co-ops, on their own, floating in the market, tend to replicate the behavior of worker-owned capitalists in some circumstances. They sometimes develop positive participatory schemes, sometimes not. But we know from the studies of worker-owned plywood companies in the US, they can tend to develop conservative attitudes, not socialist attitudes. So there’s a whole question about the role of worker-owned companies, and even though I’m an advocate of further democratization of the workplace, we also need to be building larger structures.

This is what’s happening, for instance, in cities like Cleveland: the notion is a community-wide ownership structure that encompasses partially independent worker-owned companies. And these businesses are partly supported by the purchasing power of non-profit institutions like universities and hospitals that depend on lots of public money, and this arrangement then begins to give stability to the whole geographic community, articulating a vision and politics that builds for the entire community. It’s a mixed model that is being tested.

My argument is that the planning model can be managed partly by economic participatory economic planning, partly by market, but critically, when you get to the point where you can do that kind of planning, the model becomes less and less significant because it’s constrained and encompassed in a larger framework. I think the question that most critics of your model, Michael, have raised is important: the notion of each person laying down what he or she plans to buy or needs against a production schedule, that is, what they’ll actually contribute, becomes an extremely difficult path to envision as realistic. Somebody pointed out recently in an article in Jacobin that if you look at just the kitchen goods for sale on Amazon, there are millions of items. Now that’s not the society we want, obviously, but it points to the magnitude of the issue: the planning problem becomes extremely difficult if you don’t use some forms of market to adjudicate purchases and production.

I think we need to move experimentally with planning and markets, as well as with community development forms that don’t include either one. I’m very interested in how we democratize and socialize, at different levels, the ownership of productive wealth. And then moving steadily from models we learned from up from community to region to nation, always following the principle of subsidiarity: keeping it as low as possible.

MICHAEL ALBERT: You mention that markets will corrupt a worker cooperative because it’ll create a context in which—and I agree with you—there’s a tremendous incentive to essentially, maximize, not just profits for owners, but surplus among that workforce. And so you begin to see the same kinds of behavior, say colluding, not cleaning up the environment, speed ups exploiting workers who are weaker, and so on and so forth. Okay, agreed. The solution you bring up is that we can have some community-wide participation that puts restraints upon the way those pressures and incentives play out. Well, I don’t disagree with that as part of an answer. That’s certainly plausible.

But another way you can try to proceed is by understanding that the problem is the impact of the market. Or understanding, that a corporate division that divides the work classes into two classes of labor, one above and one below, corrupts what you’re doing. If we understand these two sources of corruption or subversion of our aims, then we can talk about them, and we can build a movement where the people who are participating are aware that over the long haul, we have to solve the problem of the division of labor and the problem of allocation, because if we don’t, the old corporate and market structures will corrupt what we’re doing.

It’s certainly true that if you have millions of goods, and you ask, can Joe look at all those millions of goods, evaluate them, and ask how much of each he wants—that’s absurd. Joe can’t do it, and he’s also not remotely interested in doing it. But even now, of course, neither Joe nor you nor I evaluate all possible options, but we still find options that suit us. So in a participatory economy, the consumer and the producer basically have to indicate their desires for different categories of clothing or food or housing, or various kinds of luxury goods or enjoyable goods. That doesn’t mean you have to itemize down to the color or the size. Many things are statistically totally determinable once you have the overall inclinations of people.

In Venezuela right now, there are diverse experiments going on, trying to experiment locally with alternatives that move towards a more egalitarian society, in which wealth and power are democratized—they’re trying to do at least elements of what we’re talking about. And in these experiments, two things come up pretty often, not just as long-term issues, but as immediate short-term issues: the division of labor in the workplace, and the impact markets in corrupting possibilities.

So for instance, in the countryside they have consumer co-ops, that is to say, communities which are trying to find a way to determine their overall consumption and trying to share it among the various members of the commune in a fair way. And then nearby, there are producer communes that are producing, for instance, the agricultural goods that the neighbors are going to consume. So what they have begun to do is to negotiate allocation. Instead of having a market determine how this transaction between the people who are farming and the people who are eating in the countryside will occur, they meet together and negotiate cooperatively what they think is just and fair and right. That’s potentially a beginning for participatory planning.

You mentioned the case of workers in the factory that didn’t want to be the ones particularly running the show, so they would go out and hire a manager. I understand that. It’s a perfectly understandable dynamic and even predictable. What happened in Yugoslavia is instructive: they made a revolution, got rid of the capitalists, instituted market socialism, and initially had workplaces where everybody was treating everyone equally, everyone calling everybody comrade and so on. But over time, because of what you described earlier, the competitive pressure of markets, these Yugoslav workplaces have to cut costs, make alienated decisions, to pollute, and on and on. If they previously met together in councils and decided they wanted things like daycare, air-conditioning for everybody, and clean air in the workplace and wanted to clean up for the community and so on. Then, nonetheless, under the pressure of competition, they had to start going back on those decisions. And because most people didn’t want anything to do with going back on those decisions, and certainly didn’t want to be the ones to make such degrading choices, they went out and hired managers and got them from business schools from capitalist countries to a large extent.

This wasn’t a healthy process, and this is what we’re talking about when we talk about changing the division of labor in the workplace so that everyone’s doing their fair share of empowering and disempowering work. It doesn’t mean that management pe se disappears. It means that managing, and conceptualizing and organizing and doing agendas, and all sorts of various empowering tasks, as well as the rote tasks, are handled in a way which doesn’t elevate some people to dominating others.

 

On the ground

GAR ALPEROVITZ: Just to clarify: In the model I mentioned—the one that featured in Michael Moore’s movie—the workers didn’t want to “manage;” they wanted control—which is to say the manager (administrator) if he was not responsive to their needs and desires. Let’s again return to what’s happening on the ground—all but ignored by the mainstream press. What’s interesting is that a truly massive process is underway that I have not seen happen in my entire adult life, particularly with regard to the ownership of capital and the development of co-ops, and worker-owned companies, and land trusts, and community owned structures and municipalization strategies. Though the public press does not cover this, it is, in fact, explosive. In my experience most activists and radical theorists are also unaware of the range of activity. (Our website community-wealth.org is one useful resource for coverage of these developments). As people learn more and more about the development of this pattern of democratization, they are also teaching each other principles that can be applied at higher levels as we move forward. As I said earlier, given the challenges facing the dominant system there are certain to be opportunities again with the big banks—more crises—and as people learn different principles over time, getting to national and regional scale of democratization is possible. I believe a parallel process is also likely over time in connection with health care: As the system falters and fails, moving towards democratization is likely. California passed single-payer twice, but this was vetoed by Schwartzenegger. Vermont is likely to establish it this year. And beyond single-payer is likely to be a still more democratized system in a sector now nearly 20 percent of the economy.

The most interesting developments that are going on, in my experience, are those that build and anchor workplaces in communities. In Cleveland—and an increasing number of other cities in the United States—what you have is a quasi-public entity, that is, a hospital or university that has a lot of public money in it, providing support by purchasing goods and services from worker owned companies linked together as is part of a geographic community-wide structure, with part of the surplus feeding back into the community to create new businesses. So it’s not just about the workers, but as a matter of structure and principle, it’s a vision that builds a community—or commune—and that’s happening experimentally in many parts of the country.

Interestingly, in Argentina, if you look at the recuperated factories and other businesses, many of them now are actually moving towards the model I just suggested, with places like the municipality (for instance Buenos Aires) purchasing from them as a way to stabilize their market and to socialize their procurement for public use, schools and hospitals, for instance. That structure of using a larger public institution—in this case, city government—to sustain and nurture different patterns of cooperative production stabilizes the market. This is where I think the exciting action is if we want to think about possibilities of moving toward a larger systemic vision. And as I said earlier, we could come back to the question of whether that eventually ends up using markets in some cases, or cooperative parecon styles in some areas, or public planning in other areas. I think it’s an open question.

MICHAEL ALBERT: I don’t disagree that there are many experiments, and in those experiments, people learn principles and those principles can be applied more broadly. There can be instances, although I’m not sure there’s much of this in the US that’s of any merit, of governments helping local experiments to stabilizing their operations, but I don’t think this is going to happen at a significant scale anytime soon unless movements force it. And I don’t disagree that in Venezuela and, to an extent, in Argentina, the government has indeed helped experiments become more and more participatory, more and more moving toward self-management, and that is exciting. I was very much excited by the taking of the firms in Argentina. I am excited in the United States, by the development of co-ops, and the extent to which people in the co-ops really do want something new, and more generally by the simple fact of the changing consciousness in the United States which is very much drifting away from faith in capitalism.

GAR ALPEROVITZ: On that latter point, that’s exactly where you and I agree entirely!

MICHAEL ALBERT: But where we seem to disagree is around participatory planning. Most people don’t criticize Parecon because of its notion of what is equitable, or its notion of self-management, or its notion that we should have solidarity; they criticize it for being too complex. The claim is that at some point the participatory planning process simply burdens people in a manner that people won’t accept, or shouldn’t have to accept, and that we should try to do it in a more efficient way, for instance, through markets.

My problem with this objection is twofold. First, it very quickly comes to the conclusion that it’s too complex, there are too many steps or too many people involved in the planning process—all of which there are answers for, which, however, are generally ignored by the critic. And second, it goes back to markets as a solution. The problem with markets isn’t necessarily their complexity (although some of the ones that exist today are so complex that nobody knows remotely what they’re all about!). The problem with markets is not that they demand too much of us. The problem is that they turn us into egomaniacs. They destroy the ecology. They produce class difference and gargantuan income differentials, much poverty and some plenty.

So I will grant you that it may be the possibility that when we experiment with it, and when we learn more about it, participatory planning will require some very clever refinements so as to reduce the amount of time and complexity that’s involved with that part of our lives. But to say that we can’t go through this process of experimentation and refinement, and that therefore we have to fall back on markets, is analogous, to me, to somebody saying that democracy puts complex demands on the voters, and therefore it would be much easier to have a dictator decide. Actually, it’s even worse, because you could imagine a dictator who is reasonably humane but markets are structurally incapable of delivering humane outcomes. In such an approach one is literally trading a fear of complexity, for a certainty of cataclysm.

GAR ALPEROVITZ: Michael, we just discussed two specific models in which worker-ownership is combined with one or another form of public planning, and a third where this is partially true. In Cleveland and in Buenos Aires the use of public purchasing partially stabilizes the market for worker-cooperatives. In Venezuela co-ops themselves provide support for each other (while in practice they also receive public support, i.e. another form of planning in the real world.) The critical point here—for a transitional strategy—is to understand the complexity of these processes and at the same time attempt to foster further movement, practically, towards a more evolved model without jumping steps and creating chaos in the learning and development process.

 

On values:

MICHAEL ALBERT: Gar, you’re involved in what I think are incredibly important and valuable experiments trying to do things in new ways. Wouldn’t it be advantageous when working with people who are setting up co-ops to help them understand that they don’t want to replicate the old division of labor which will corrupt their values and aspirations—that they should want to organize their work in a new way that has everyone participating and empowered? Wouldn’t it be advantageous to help them understand how market pressures will conspire to corrupt their creativity? And wouldn’t it be desirable to help them see that there are ways to avoid those ills?

GAR ALPEROVITZ: On participatory planning within the firm or within the community question, on restructuring jobs and the culture of work—with rotation and open-book management and so forth—that sort of thing is already being developed in many parts of the country, experimentally, and I certainly agree that that is the direction to go.

Caveat, what you find is that in many situations is that many people don’t want to do these things! The reality of the world we live in is that people sometimes aren’t interested in many circumstances; no matter how much young radicals yell at them, that isn’t what they want to do right now. So you have to work with the reality, and it’s particularly important because what we often find is that people who care about these issues, actually don’t want to deal with what poor black people who are interested in co-ops or what working class people who are actually trying to develop worker-owned firms actually think and feel. We need to learn to listen to what the people need and want, and not try to impose on them a whole schema that they may not. This is historically difficult stuff: how do we balance the project of raising consciousness, advancing a vision of utopia, with the real and honest engagement in real-world experiments.

And more may be possible than we think. As I said earlier, there has been a change in consciousness that makes this one of the most interesting periods of American history, maybe the most interesting. There’s a loss of belief in the corporate system, there’s a recognition that something is fundamentally wrong, there’s a discussion beginning around socialism amongst younger people, who recent polls show react slightly more favorable to that formerly taboo word than to “capitalism”. So there’s an openness to discussing things, and also to questioning the traditional state socialist model as the only alternative on the table. So there’s an opening to a whole different vision of where to go forward. I think that’s where we are in the question, so let’s not blow it; let’s see what we can develop over time.

MICHAEL ALBERT: We agree that there’s a giant opening. We agree that we don’t want to blow it. We agree that it’s certainly the case that lots of times people don’t want to change their circumstances dramatically in a direction which doesn’t seem worthwhile, or which even seems like it might even be some kind of con game.

Again using the Venezuelan example, it’s frequently the case that at workplaces down there’s an effort to introduce workers management or workers self-management that the workers themselves resist, not because they resist the idea of self-management per se, but because they think it’s a scam to get them to work harder, without them really having any more power than they do now. So I agree with you, of course, one doesn’t impose something, but one does have to discuss it if you’re ever going to get there. And that means discussing in a way that moves in the direction that we want to go to: which means talking about changing the division of labor and about the problems with markets and a real alternative.

I could be completely wrong about this, but I think that markets as an institution, even without private ownership, are vile. They’re not just vile; they’re one of the worst creations of humanity in its entire history. They warp human development, warp personality, misprice virtually everything. They skew the direction of development to have little to nothing to do with the human well-being of most of the population. They violate the ecology. They produce class division. We know that central planning is also a horror. It’s a horror when it’s imposed on a workplace like in General Motors, which is essentially planned internally, and it’s a horror when it’s imposed on the whole society. It seems to me that saying these things should be no more controversial than saying we don’t want dictatorship or we don’t want private ownership. No one would say that the fact that we need to experiment, to learn, to listen, implies that we ought to hold in reserve or even jettison our understanding that private ownership and dictatorship are disastrous.

Now, I agree with you, it is a big deal to articulate what the participatory alternative is. But the discussion shouldn’t be that any participatory alternative is too complex or demanding so we have to fall back to markets. There is no falling back to markets. Falling back to markets is like falling back to dictatorship.

There has to be, instead, a constructive suggestion of an alternative way of doing allocation. This idea of the possibility of stabilizing experiments through government policy could be a positive thing, but could also of course be an incredibly destructive thing. To the extent that we can force the government to utilize some of its gargantuan resources to benefit experiments that really would enhance the well-being of the population, that’s terrific. But you’ll have to force it because the government is in the hands of the rich and powerful. That’s part of the process; we don’t want to do it in a way that elevates the government as being our savior and dissolves movements. We want to do it in a way that builds movements and builds continuing pressure.

You talk about all these various experiments and I agree. I think setting up a co-op is good. Setting up a co-op with self-management is better. Setting up a co-op with self-management and with balanced job complexes is even better. Setting one up like that, and that’s in a position to negotiate with its consumers is terrific. And if they can get aid from public funds to stabilize and ensure survival, great. But I don’t think that is the road all by itself to a better society: we also have to have massive movements which are making demands both in specific institutions, say like General Motors, and also in society as a whole.

GAR ALPEROVITZ: That goes without saying, Michael, I totally agree with that! That’s what I’ve saying and writing about for years. But once you get away from the abstract that we’re talking about, these principles, if you actually get your hands dirty and start talking to different groups other than the gang of young people who we find easily these ideas accessible very quickly, it’s a different game. How do we reach ordinary Americans in my hometown of Racine, WI where the problems are just extreme? How do we begin to understand them, and where they are coming from, and actually work with them in a way that works? That requires both understanding of the principles, but also being willing to test different ideas with them: patience and humility.

 

Alternatives

MICHAEL ALBERT: I was in Argentina in a room with about 50 people that were there from different occupied factories and I’d been asked to come and speak. We started around the room and the first person who spoke described their situations and concerns, and by the time we got to the 7th person, and this really happened, a lot of people in the room were crying. This person spoke and put it very eloquently and said: I never thought I could possibly ever be saying anything like this—he, too, was tearing up. He said that we took over the workplace, the owners and the upper management were gone, because they didn’t want to be a part of a workplace that they thought was going to fail. And we took it over and made it work. But now he had to say, I’m afraid Margaret Thatcher was right, there is no alternative. This is why they were crying.

He said: we took it over, we were so excited, we made our wages equal. We instituted democracy. We had a workers’ council. We made our decisions democratically, and after a period of time, all the old crap came back. All the old alienation came back, and now it just feels the way it used to feel. And they were all saying it, person after person was saying it. I talked to a woman in one of those workplaces who had been working in a glass factory, in front of an open furnace all day long. Then they take over the factory and they go around the room and ask who wants to do the finances and keep the books, and nobody would do it, and she volunteered to do it. She’s just a worker, the same as everybody else in the place, she hasn’t gone to school or anything. I asked her “what was the hardest thing to learn?” She wouldn’t tell me. So I asked again and she didn’t want to tell me. “Was it to do the financial books?” No. “Was it to operate the computer?” No. “Was it to do accounting?” No. What was it? I was at a loss. She says “Well, first I had to learn to read.”

And four months later, she is doing the accounting and the bookkeeping for this glass firm which is now functioning at a surplus, whereas the capitalists have been running it into the ground and losing money. But the downside was that she, as the accountant, was becoming a member of a class of people in that factory, about 20%, who were highly empowered and who appeared far more pivotal to the functioning of the factory. And who, over time, were bringing back the old alienation, even though she was just a wonderful person.

So I tried to describe the idea of balanced job complexes. When they took over, and the manager who was doing the accounting left, somebody volunteered because not many people wanted to do it. And I said: well, pretty soon what happened is that you had one-fifth of your workforce doing work that’s really empowering, and after a while they’re governing, and after a while they’re paying themselves more because they think that they deserve more, and the rest of the people aren’t even at the meeting where this gets decided.

And they agreed with this; it helped them see that there was a reason for this: it wasn’t human nature. Thatcher wasn’t right. It wasn’t inevitable. They could’ve done things a little bit differently and could have had significantly better results. But one told me: we did a lot of that, and we still had problems. We were trying to reapportion tasks and so on, and it still went bad. So then we talked about the market and the pressure that it put on them to compete, and the way that pressure slowly but surely re-introduced the old division of labor. So my experience is somewhat different from yours: I find that it’s easy to talk to working people about, say, balanced job complexes—I have more trouble talking to perhaps half the young radicals nowadays, and much more trouble talking to left academics. With the latter, it’s almost impossible!

GAR ALPEROVITZ: I don’t think there’s a difference in the value structure here. We may have some different experiences. I think there are some places where people will in fact pick up on those themes and try to develop rotations and accept the inefficiencies that they will experience in the short run. But all of this takes a lot of energy and a lot of time, and some people just don’t want to do it. In some places, people will. And I think the question of experience, given the stage of history of the real world, where we are really at, will help us understand how to what extent we can push these developments in different areas. I regard this as a question of testing the real world. Not whether or not these principles about planning and markets are correct in the abstract: these questions are testable, and we should test them wherever we can. But I am cautious about imposing or trying to impose a vision on people who don’t want to hear the vision. The critical thing is whether or not the communities in which we are engaged wish to do an experiment with and test the models that intellectuals, and radicals, the left, and theorists, and so on come in with. And the answer is, in many cases, no. And for reasons that are good reasons, for instance, in some places, they are frightened to death that it will blow up the current structure of work and they’ll lose their jobs. People will understand what you’re talking about, but they are going to find the solutions, the mix of principles and problems that works for them, in their situation. And that mix is by no means obvious: by no means is theory a reliable guide to the way this comes out in the real world. So for instance at Isthmus: they understand the dynamics of power and management, but they don’t want to share those responsibilities: for them, the solution is to recognize that those are positions that nobody wants to do, and you hire someone to do them that you can control democratically or even fire, if you don’t like what they are doing. The values you’re talking about, I don’t disagree with at all. What we’re talking about is where we are in this stage of history with specific communities, all with different skills, levels of support, income, and training and all ultimately exposed to the markets whether they like it or not. This is the reality where we need to move and advance these different ideas. And to do so effectively, it seems to me to be a matter of testing as we go, on the one hand—and projecting a larger possible longer-term vision, on the other. I suspect that to the degree we actually keep testing and developing in the real world, there is likely to be convergence on several levels between many of the Parecon and the Pluralist Commonwealth models.

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