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Review: Parecon: life after capitalism

category international | economy | review author Wednesday November 23, 2005 18:52author by Cian Lynch - WSM - Red and Black Revolution Report this post to the editors

Review of Michael Albert book

Anarchists, in common with all radical proponents of social change are continually asked what their vision of a new society/economy is. The book outlines a radical vision of social and economic reconstruction whose core principles and values, Solidarity, Equity, Diversity and Self-Management, are very familiar to anarchists
Parecon cover
Parecon cover

Book Review

Parecon : life after capitalism

By Michael Albert, Published by Verso


Anarchists, in common with all radical proponents of social change are continually asked what their vision of a new society/economy is. What is the "Master Plan", the "Blueprint" that will be followed? We are justifiably wary of outlining any "Blueprint" for an anarchist society that would suggest that it is THE solution and should be followed to the letter - who would enforce this great master plan after all!?

Any set of theoretical ideas about a new society and economy is only a model and we should all remain flexible in any approaches to its implementation. All of us together will ultimately decide co-operatively on which elements are worthy, which need to modified, and which may be discarded.

This book was written by Michael Albert who helped to found Z Magazine and South End Press. Z Magazine is an excellent progressive political magazine in the U.S. and is also published in an e-mail newsletter format, which I highly recommend.

The book outlines a radical vision of social and economic reconstruction whose core principles and values, Solidarity, Equity, Diversity and Self-Management, are very familiar to anarchists. A quick glance at the table of titles referenced shows up such titles as: Daniel Guerin's - "Anarchism", Kropotkin's - "Mutual Aid", and Rudolf Rockers "Anarcho-Syndicalism". Indeed as will be quickly discovered, the entire vision is built on well-known anarchist values.

What is interesting though, is that the word "Anarchism" does not appear anywhere in the main text, and will only be discovered if you look through the short bibliography at the very end. Was Albert trying to hide what he saw as a "dirty secret" here? I admit this is just a conjecture, but it seems hardly accidental that a book so firmly founded on anarchist principles should so carefully avoid mention of the word anarchism anywhere in the text.

The book is subdivided into 4 parts, part 1 contains an introduction to some basic economic terms and definitions - ownership, allocation, division of labour, remuneration, decision making and class structure. There follows an analysis of economic systems and how they match up to the goals of Parecon : (1) Equity, (2) Self-Management (3) Diversity (4) Solidarity and (5) Efficiency.

Capitalism and Centrally Planned "Socialism" are thoroughly picked apart here and Albert shows how each system will undermine each of the anarchist values I mentioned: Solidarity, Equity, Diversity and Self-Management.

Part 2 contains a comprehensive vision of participatory economics that outlines in some detail the economic structures that are being proposed. We can summarise the core Parecon elements as:

(1) Social ownership of the means of production

(2) Direct democratic councils (Workers and Consumers)

(3) Balanced job complexes

(4) Remuneration based solely on effort and sacrifice

(5) Allocation through participatory planning

It would be impossible to cover these in any real depth here, but suffice it to say that these economic structures do a very good job of describing how one type of anarchist economy might function in practice. A key difference between Parecon and an Anarcho-Communist economy is the continued existence of a form of "money", which some might instinctively balk at, with the implication that some form of "market" economy will continue to exist in Parecon. However I believe this fear is quite unfounded.

The fundamental allocative structure of anarcho-communism, "of each according to his need" is also fundamental to Parecon. Any extra remuneration received by individuals will be due to their own personal effort or sacrifice. To clarify, if someone works in more difficult or dangerous conditions than average, or puts in more hours of work than average, they would be remunerated for this. On the other hand, there is no remuneration for "contribution to output" - e.g. a stronger worker may cut more sugar cane in a days work than a smaller, weaker worker, but they are not paid any differently (at least on the basis of their output).

There is also social ownership of the means of production and participatory planning, organised in a federative and co-operative structure throughout all industries, so there is no "market" system as such. One of the key things to keep in mind is that prices in a parecon are generated and modified through participatory planning, starting off annually as merely "indicative", and consequently passing through several rounds of adjustment. In these pricing adjustment phases, changing productive capacity and demand is taken into account in addition to any arising social or environmental concerns.

Overall, I believe Parecon provides a comprehensive vision that is worthy of serious consideration and debate among those who are interested in more progressive economic structures. For those looking for practical examples, some of the economic structures of Parecon have been implemented on a small scale in South End Press, a publishing co-operative, which Michael Albert helped to set-up.

Reviewed by Cian lynch

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The entire book: Parecon "Life After Capitalism" is online at

www.zmag.org/books/pareconv/parefinal.htm

The Parecon website is: www.parecon.org

The South End Press website is: www.southendpress.org


From Red and Black Revolution No 9

Read the articles online at http://www.struggle.ws/wsm/rbr/rbr9/

Download the PDF file from http://www.struggle.ws/wsm/pdf/rbr/rbr9.html

author by Ilan Shalif - Anarchists Against The Wall, a-infospublication date Thu Nov 24, 2005 05:21author email ilan at shalif dot comauthor address author phone Report this post to the editors

Michael Albert is not anarcho-communist.
His model have lot of flaws and inconsistancies.
He is a kind of "dualist" which mayconfuse people who like one of the sides and do not see the other and the inconsistancy.
"remuneration received by individuals will be due to their own personal effort or sacrifice" is not compatible with the principle of anarcho-communism of from each according to ability - to each acording to needs.
His "balanced jobs" pretend to make work allocation automatic and not part of direct democracy of grass root communities.

He pay lip service to social cohesiveness, but he clearly do not
propose the world commune of grass root communities as the above grass root communities direct democracy. The various organizations are a kind of independant entities and not part of
one direct democracy system.

His model try to integrate the anarcho-communist approach with the anarcho-syndicalist, with some mutualist points... in spite their being uncompatible with each other.

Related Link: http://ainfos.org/ilan/anarchism
author by Guspublication date Thu Nov 24, 2005 11:05author address author phone Report this post to the editors

It's good to see another consideration of "Parecon." (As to M. Albert's anarchism -- I don't think he is one.) There are anarchists who like Parecon and those who don't. I think U.S. anarcho-syndicalist Tom Wetzel has written favorably about it. I believe a Google search, with both Tom Wetzel & Parecon mentioned, will find that article. And I think NEFAC's Northeastern Anarchist magazine has done an article on Parecon. One article against Parecon can be found in the British magazine Organise! of the Anarchist Federation, an anarchist-communist group. It's called: The Sad Conceit of Participatory Economics and is from Organise! #62 - Summer 2004. It can be found at:
http://www.libcom.org/hosted/af/org/issue62/parecon.html

author by Elipublication date Thu Nov 24, 2005 15:43author email notallwhowanderarelost at hotmail dot comauthor address author phone Report this post to the editors

This would be refering to the post Ilan Shalif. The 'remuneration according to sacrifice and effort' need not conflict with 'from each according to ability- to each according to need', since each worker's council member could be paid according to a scheme which factored in thier effort and sacrifice, then determined whether this ended up being less than their need. If it were, the worker could either be paid more as a matter of course if the extra need was ongoing (such as having several children, one of whom had cerebral palsy), or the worker could borrow against future labour credit if the need was temporary ( such as paying off a new vehicle for the family or car co-op).

I should mention that I've not done oodles of reading on communist or anarchist theory and dogma, but it seems to me that just because some aspects of some tenets appear to disagree with others we needn't hold them to be mutually exclusive, we can just massage out the differences and bring them together. Often great truths come of conjoining disparate ideas.

Further, I feel that the 'nested councils' (neighborhood within city within county etc.)approach to direct democracy does envision a global grassroots community of grassroots communities, and the iteration/facilitation boards look to me to be seamlessly cohesive with the whole.

Also, I'm unsure of what you mean exactly by "balanced jobs pretend to make allocation automatic and not part of direct democracy"
Creating balanced job complexes would certainly be difficult at first, but once the groundwork is laid, the refinement of the initial allocations is probably pretty easy. It may be that I've misunderstood you though, if I have, please clarify.

As for other lurking pareconistas out there, has anyone figured out if owning a home works at all in a parecon, or would that be an unfair ownership of productive capacity? I'd love to hear some ideas on that one, particularly in a transition phase (from capitalism to parecon).

author by Ilan Shalif - AATW, a-infos.capublication date Thu Nov 24, 2005 18:23author email ilan at shalif dot comauthor address author phone Report this post to the editors

The choice of anarcho-communism as alternative to capitalism is not because I like it more than the other alternatives... It is because I think it is the ONLY alternative to capitalism.

Albert who dislike A-C proposed his 'Balanced Jobs' as a way to evade the mandating of people to work jobs by the grass root community.

Albert and many other declared anarchists propose models with less than total social solidarity and more "pluralistic" than one multi tyer direct democracy of the world commune of grass root comunities.

In an integrated society there is no "negotiating" between independant agencies/entities, but coordination between autonomeous one within the same decision making system.

In anarcho communist society there is no connection what so ever between the contribution of a person to society and the cover by society of all hir needs. The social appressiation of the contribution of a person is purely in the social sphere.

The model of the post capitalist classless society is not in the science fiction sphere... Hundreds of thousands people have lived in commune within the modern capitalist system, and social scientists did more than basic research on the social aspect of people. We do not need any diluted or dualistic alternative to the multi tyer anarcho-communist "monist" direct democracy of the world commune of local communities.
Ilan

Related Link: http://ainfos.org/ilan
author by Andrew - WSM (personal cap)publication date Thu Nov 24, 2005 19:54author address author phone Report this post to the editors

Actually the reviewers treatment of the concept of communism caused quite a bit of discussion at the editorial meeting of RBR where this was submitted. But as it was a review (and therefore of limited length) we didn't think it make sense to tell him to flesh this out a lot more. It did highlight that the meaning of communism as a concept was probably not as well understood among anarchists as it should be. Which is why we commissioned the article 'What is communism?' - An anarchist analysis of the history and meaning of communism for the following issue. It's at

Related Link: http://www.anarkismo.net/newswire.php?story_id=1555
author by Cian - WSM (Personal Capacity) - Anarkismopublication date Thu Nov 24, 2005 23:08author address author phone Report this post to the editors

Hiya,
I'm happy to see some good responses to this, so I just want to clear up a few things and respond as best I can to the queries and doubts people have about Parecon.
Firstly, a minor correction : the book itself is published by Verso, not South End Press.
Now, one of the main points Ilan makes is that "remuneration received by individuals will be due to their own personal effort or sacrifice" is not compatible with the principle of anarcho-communism of from each according to ability - to each acording to needs."
You must bear in mind that "remuneration according to effort and sacrifice" is not the sole distributive norm of parecon. ". Chapter 2 explains that "Norm 4: Remunerate according to each person’s need." should be implemented "when possible and desirable". Thus "to each according to their need" is, in my view as fundamental a part of a Parecon as it is of Anarcho-Communism.

I have also read NEFAC's critiques of Parecon and the responses to them, but I was not convinced that those who argued against Parecon had understood it properly. Some suggestions were that parecon was a "market system" which is plainly not the case, :- i will summarize Michael Alberts own points here : " (1)Participatory planning doesn’t have buyers and sellers maximizing their own advantage each at the cost of the other.
(2) It doesn’t have competitively determined prices.
(3) It doesn’t have profit or surplus maximization.
(4) It doesn’t have remuneration according to bargaining power or output. "

As for anarcho-communism being the only alternative to capitalism, this is plainly ridiculous, many economic models are possible from State Capitalism, market socialism, to the feudalistic and tribal structures of the past. All these are possible, what matter is what is DESIRABLE, and which we would prefer to implement.

Let me further emphasise that I have no grevious objections to anarcho-communism, I just think that Parecon is a more structured and practical vision which I think makes more sense in terms of how in practice, supply would be brought into line with demand, and how we can reward those who put in extra effort and sacrifice.

author by Ilan Shalifpublication date Fri Nov 25, 2005 00:46author email ilan at shalif dot comauthor address author phone Report this post to the editors

Cian wrote:
Now, one of the main points Ilan makes is that "remuneration received by individuals will be due to their own personal effort or sacrifice" is not compatible with the principle of anarcho-communism of from each according to ability - to each acording to needs."

You must bear in mind that "remuneration according to effort and sacrifice" is not the sole distributive norm of parecon. ".

Ilan
In the capitalist system too "remuneration according to effort and sacrifice" is not the sole distributive norm.

However, like pregnancy... it is mainly if it is or not - qualitative,
though there are quantity too..

Even if marginal, remuneration according to effort and sacrifice
is to my opinion out of the anarcho-communist spectrum.

Cian wrote
Chapter 2 explains that "Norm 4: Remunerate according to each person’s need." should be implemented "when possible and desirable". Thus "to each according to their need" is, in my view as fundamental a part of a Parecon as it is of Anarcho-Communism.

Ilan
Not according to my logic.

Cian
Participatory planning doesn’t have buyers and sellers maximizing their own advantage each at the cost of the other.

Ilan
Participtory planing is compatible with the anarcho-syndicalist
model in which the producers are kind of independant and not
autonomeous delegates of the grass root comunities.

Cian
As for anarcho-communism being the only alternative to capitalism, this is plainly ridiculous, many economic models are possible from State Capitalism, market socialism, to the feudalistic and tribal structures of the past.

Ilan
Non of the above were post capitalist class less societies.

Cian
Let me further emphasise that I have no grevious objections to anarcho-communism, I just think that Parecon is a more structured and practical vision which I think makes more sense in terms of how in practice, supply would be brought into line with demand, and how we can reward those who put in extra effort and sacrifice.

Ilan
If you object to the multi tyer direct democracy, you need another means for coordination of production....

However, the suggested method which is based on consensus as there is no common base for decision all sides are part of.

And we know that mandatory consensus is not compatible with direct democracy.

As for the structure and practicality of the Pancon, every Israel of the hundreds of thousants who were members of communes (Kibbutzes) will lough at it.

Even the anticommunist settler colonialists built communes
that did not include Remunerate according to sacrifice
or effors - just according to needs pluss equal ratio to the
above basic needs.

author by Tom Wetzelpublication date Fri Nov 25, 2005 13:45author address author phone Report this post to the editors

Ilan's view, which isn't really laid out here, is
that all decisions pertaining to an economy
should be made via a One Big Meeting of
the entire population of a community, similar
to the variant of libertarian communism
advocated by Bookchin. The problem with
this is that it violates self-management at least
three ways:

(1) Community assemblies, as economic
decision-making bodies, are only capable of
deciding on public goods (things collectively
enjoyed) for that community. If this is the only
way that people can affect what is produced,
it denies individuals their own means of
distributing their share of the social product
among possible private consumption goods as
they see fit. This violates personal privacy. In
parecon individuals can put in proposals for
products without getting it approved by a general
assembly. This is necessary to have a private
consumption goods sector that actually
produces what people most prefer.

(2) There are decisions in workplaces that
mainly affect the people that work there.
It is a denial of their self-management of
their work to have everyone in the
community have a say equal to the workers
themselves over everything that goes on
where they work. Parecon avoids this by
having a separate srtructure of workplace
assemblies in addition to the community
assemblies.

If Ilan's principle were applied over a large
area, as it must to have a viable national
or continental economy, it would require
a central planning bureaucracy and you'd
be back to a class system like that which
existed in the USSR.

(3) In a complex modern economy you only
have an effective model for how the economy
can work if it can tell us how resources are
to be allocated for vast regions of millions
of people. If a single community makes
decisions unilaterally over its production
facilities, this denies self-management to
the people who receive the products over
things like what the product is like. It also
fails to tell us how work is to be distributed
between many different communities into
a single planned economy.

Because the community assemblies are
the place where decisions are made about
proposals for production of public goods,
the community assemblies and federations
of these over large regions are the key in
parecon for the production and defense
of public goods, like the defense of the
health of the ecosystem, which is a hugely
important public good.

Parecon does have an extensive place for
the principle "to each according to need" --
all the needs of children, the retired,
unemployed, disabled are to be covered
at social expense. Health care and education
are to be provided at social expense.

But it does propose that able bodied adults
earn their share of the social product through
their efforts in socially useful work.

Illan is simply incorrect when he says there
is some "mutualist" element in parecon.
Mutualism says that workplaces are collective
private property of the workers there, and
involves a market system. Parecon is a
socially planned economy, not a market
system. Means of production are owned by
the entire society, they are not private property
of the workers who work there. Possession
of means of production by groups of workers
would enable them to use their effective
possession of the workplaces to as much
of the social product as their market power
enables them to. In parecon workplaces
are all owned by the entire society and
managed by the workers as a kind of
subcontract from the society. Their remuneration
has nothing to do with the sales of the
products but is based only on their effort
and sacrifice in work.

Ilan is also confused about the purpose of
"balanced jobs." This is necessary in order
to dissolve the class distinction between
the elite of managers and top professionals
and the mass of ordinary workers, which is
not based on ownership of the means of
production but concentration of empowering
work -- work that involves conceptualization
and decision-making that gives them control
over other workers.

Participatory planning involves a negotiation
process through which people as workers and
as residents of communities create, from below,
the social plan for the whole economy.

A defect in libertarian communism historically
is that it really has no worked out mechanism
for allocation of resources. The libertarian left
has historically always supposed there was
an alternative to the market and central
planning but never said clearly what it is.
Participatory planning was evolved to fill that
gap.

Tom Wetzel

author by Andrew - WSM (personal capacity)publication date Fri Nov 25, 2005 21:11author address author phone Report this post to the editors

I think the discussion is useful because it clarifies that parecon is not communism but rather a blueprint for another post capitalist economic system. Having communist elements with regard to the old, sick or children does not make it communists - (arguably some advanced capitalist nations also have something close to this)

I actually know little about it - mostly because I'm not that interested in blueprints. But I'd be interested to see how it deals with the traditional problem of non-capitalist economic systems - chiefly the tendancy to recreate class society.

Any system which contains a market will tend to create class society because a market allows trades in which some do better than others and the ones who do better can then accumulate wealth. Importantly the market does not have to be encouraged or even legal - it will arise if someone has access to goods or services that someone else needs. It will continue to exist even if considerable recourses are expended to try and shut ti down - the recreational drug market in the US is very suppressed but it also flourishes.

A good example is prison - this was explained to me by a comrade from first hand expereience. Most prisoners are denied access to money and trade is forbidden. This does not mean it does not happen though - and if you can't stop trade / money / market in a prison how would it be stopped in a free society.

Prisons tends to forbid money so prisoners find things that can be used as money - they may have a use in themselves but they also become the currency by which goods and services are exchanged. The two ones you here mentioned most are cigerates and phone cards.

Under parecon it seems it would be possible for individuals to accumulate goods that other people would desire. This would create a market in the exchange of goods for goods, or goods for services. Probably before long something would become the recognised currency for such a market. Regional differences in the availability of such goods would create merchants who found it more useful to spend their time buying and selling in this market then in engaging in work in the formal system. The existance of currency would probably create a layer of workers working in the production of rarer goods for whom it would make sense to take some of these goods out of the formal system and onto the market. Currency and the market would also make it possible to create goods that society did not see a value in but which individuals might desire (heroin or child pornography for instance). This would allow the massive accumulation of personal wealth and everything that goes with this (private armies etc) - it would also recreate wage labour in the manufacture of these goods.

The point of communism was that it made all this impossible because if goods were produced then everyone had access to whatever they needed. Goods produced outside of that system would not be excahnged into that system becuase the internal goods - being free to all - would have no excahnge value. There would be no force to recreate the market. This would not appear to be the case with parecon or is there something I don't understand.

author by James - WSM - Pesonal Capacitypublication date Sat Nov 26, 2005 06:51author address author phone Report this post to the editors

Andrew: “I actually know little about it - mostly because I'm not that interested in blueprints.”

While a blueprint is never likely to be exactly implemented in a revolutionary situation, it is helpful to have a lot of thinking done before hand. Just as anarchists argue that a widespread awareness of the dangers of an elite taking the reins of a revolution is necessary to prevent it being usurped, it is advantageous to have at least some concrete ideas of how we are to organise society on a libertarian basis. Obviously it doesn't mean these ideas have to be mechanically implemented. But they are a useful starting point.
--------------------------------------------------

Andrew: “Any system which contains a market will tend to create class society because a market allows trades in which some do better than others and the ones who do better can then accumulate wealth. Importantly the market does not have to be encouraged or even legal - it will arise if someone has access to goods or services that someone else needs.”

Communism is not immune to such possibilities either. After all, we are unlikely to blessed with abundance shortly after a revolution (assuming a continent wide revolution for starters). In fact there could well be severe shortages in important products and it's highly likely that less vital ones will be scarce, at least at the beginning. Therefore society will faced with the probability that such trading will take place anyway, even in an otherwise communist society.

A libertarian society will have to decide on some crucial issues, among them:
a) the issue of how to distribute fairly goods which are widely desired, but relatively scarce.
b) there has to be some indication as to what needs to be produced in the near future.
c) the prevention of the re-emergence of a new ruling class, whether that be the old politicians and capitalists or a revolutionary elite.
And generally
d) the raising of the quality of people's lives. Otherwise they'll be returning to the pre-revolutionary set up.

Ilan's point about the basic solidarity that stems from communist distribution is important. In a revolutionary situation, which will undoubtedly be difficult, people will need good reasons to go through those difficult times. A distant future isn't always sufficient. Anarchism has to be seen as a solution to the problems that people face in our daily lives. One of these problems is unfair distribution; from unequal access to health-care, housing, to the free time available to the wealthy, to being herded on to underfunded public transport, to appalling poverty. If genuine improvements are made in this regard, and people can see that a genuinely egalitarian society is being built, their resolve will be all the greater.
-----------------------------------------------

I'd appreciate if Tom could outline the reasoning for payment according to effort expended. Who would measure this? In a sense a communist approach is simpler in that it would reduce the bureaucratic apparatus required to keep account of people's efforts. (Unless Parecon has a very simple method in mind).

I don't see the necessary link between renumeration for effort and capturing people's preference for what should be produced in the future. Tom makes a good point here: “to be socially responsible and to have an effective economy, we need to be able to capture people's evaluations of how important the various costs are in production, including ecological constraints and their own time,and also evaluations about how important the various possible uses of these inputs are to them. It's hard to see how to do this without this being encapsulated in quantitative comparisons, that is, prices. This need not mean that money exists in the form of money-capital . Capital is a social relationship and in the absence of that relationship prices and quantitative entitlements to consume can't imply money in the form of money-capital. But it does imply something akin to money at least as a means of social accounting. It's hard to see how people could be socially responsible in their consumption requests if they don't know what the social cost is of the things they consume.”

However, to reiterate, I don't see how renumeration for effort necessarily solves this problem.

Society could maintain currency system as a means of regulating consumption, but I'm not at all sure that renumeration according to effort is the most viable system for maintaining a libertarian society. Other options like a “family wage”or could be used (and closer to the traditional communist ideal). Expiatory dates can be put on the currency to prevent sinister accumulation. To capture people's evaluations requires them to regulate consumption. This is a somewhat separate issue to renumeration.

I'm inclined to think that with the development of modern technology that using money to measure the desired inputs of the manufacturing process is unnecessary. For example bar codes can be used to account for how many widgets are produced and consumed. If a million are left over, then this information can be forwarded to the producers who can adjust the production accordingly in favour of widgets which are popular. Presumably there will some time lag between people's desire for product x, but that's part of life.

My own experience of work and workmates is that we don't mind doing useful work that we can see is useful for other people. What I dislike doing is working for others, making them nice and rich, and getting bossed around, working too long, etc. In short I doubt that people would need the stick of renumeration based on effort in order to work effectively. As long as people can see that their work is useful and at least partially rewarding, most of us will contribute willingly. Sanctions can be considered for dossers I suppose, though it might be more trouble than its worth. One's view on this question probably stems from one's view of human nature and our work ethic. I think structuring the economic system on the basis that this positive element of human nature isn't there doesn't bode well for the long term.

There are lots of good aspects to Parecon: balanced job complexes (which should help prevent sinister accumulation), the mix of community and workers self-management, the attention to the need for private consumption. I guess my doubts revolve mainly around the renumeration for effort.

author by Tom Wetzelpublication date Sat Nov 26, 2005 13:18author address author phone Report this post to the editors

I'll answer two of Andrews points. First, the
participatory economics model is NOT a
"blueprint." It is a sketch of structural features
for a post-capitalist economy that liberates
the working class from class oppression. There
are many concrete ways in which such a structure
or mode of production could be worked out in
detail. Any possible economy must satisfy three
conditions:

(1) It must tell us what the division of labor is. For
example, how do you propose to eliminate the class division between the working class and the
coordinator class (managers and top professionals)? You don't have a program for
the emancipation of the class unless you can
answer this question. The Leninist revolutions
all created coordinator class modes of production.
Balanced jobs is part of the parecon answer here.
Libertarian communists didn't quite come to
this conclusion because they never developed
a theory of the coordinator class. This is because
anarchism was historically too dependent on
Marxism for its sociology.

(2) It must have a governance structure, that is, a way that decisions are made. Parecon proposes
workplace and neighborhood assemblies as
the building blocks. It doesn't differ from (at
least some forms of) libertarian communism
on this point.

(3) It must have an allocational system. The
majority of economists, both Marxist and
mainstream, believe there are only two
possibilities: markets or central planning.
Libertarian communists have never provided
a clear answer to this question. Parecon
was evolved to fill that gap, through the concept
of participatory planning.

In regard to Andrew's point: "Under parecon it seems it would be possible for individuals to accumulate goods that other people would desire." Unless your libertarian communism
intends to ban people from having personal
possesions, it will have the same possibility.
But this doesn't tell us about allocation in
social production. Within the parecon, markets
don't arrive because allocation of labor time,
use of buildings, and other means of production
is allocated only through the social planning
process, and only to self-managed worker
groups that practice job balancing. Andrew
makes the mistaken of supposing that
it is only through the market that there is
the danger of a renewed class system.
Historical experience suggests there is at
least as much danger from the consolidation
of a new coordinator ruling class.

Now, i will make one further point: Andrew
assumes without argument that communism
is possible. I think in fact that communism
is probably not possible, that it is utopian
in the bad sense of the word. The reason for
this is that you cannot have an effective and
socially responsible allocation of resources
to production unless you have some
quantitative measure of the value of the
resources and the relative value of possible
outputs. How do you know that what you spend
time and resources producing is the most
effective use of that time and those resources?
You can't know that unless you have a way
finding out what people most prefer in terms
of products. If people don't have a finite
income which they must allocate to different
possible products, so that they must make
hard choices between the different possibilities,
how will you know what they would most
prefer? In fact you won't.

This does not mean that everyone's consumption
has to be completely linked to their work. Education and health care is not allocated
according to anyone's work effortt. Children's
needs are taken care of independently of the
work efforts of their parents.

Now, as to why able-bodied adults are to have
a consumption share determined by their
effort and sacrifice in socially useful work,
that is what Albert & Hahnel propose. This is
because it would in fact encourage a greedy
and individualistic mentality if people are just
allowed to take whatever they want, as some
libertarian communists have supposed.

In practice, once job-balancing is in force
and the effort and sacrifice required by jobs
is roughly equalized, the implication is that
everyone is to be paid the same. So, I prefer
to simply say that everyone is to be paid
the same, but with the proviso that job
balancing is in force. The reason for that is
because, without job balancing, those
with special expertise and decision-making
authority could use that to accumulate social
power which they could eventually use to
unravel the egalitarian consumption system,
and move in the direction of a class system.

There needs to be a system of remuneration
of a quantitative entitlement to consume if
there is to be an effective social planning
system. As I argued above, you can't have
an effective social planning system unless
people have a finite quantitative entitlement
to consume so that they must make decisions
about which productive outcomes they most
prefer. On the usual libertarian communist
idea of everything being free and you just
take what you want, there is no possible
way of collecting the information needed to
have an effective and socially accountable
planning system.

Tom Wetzel

author by Tom Wetzelpublication date Sat Nov 26, 2005 13:55author address author phone Report this post to the editors

I see I didn't answer two of James' questions, so
I apologize for so many posts.

In regard to the question of measuring work
effort, Albert & Hahnel propose that the worker
organizations would have some means of doing
this, that is, they'd set up some means of rating
people. This is based on the reasonable
assumption that people who do the same work
are the best judges of whether someone is
shirking, showing exemplary effort, etc. My own
belief is that a revolution would require an
incredible amount of solidarity and that workers
would be likely to give each other slack, and not
want to make any minute judgements of this sort.
Nonetheless, I also think that workers would resent it if people in their workplace were obviously shirking, stealing things, etc. And it is quite reasonable that it would be the responsibility of the production groups to deal with this. Also, there are llikely to be people who at times really make exceptional sacrifices for the common good. Would their coworkers want to reward them or recognize them in some way? I don't think it is possible to decide this in
advance. However, I do think that it should be
an aim of equalizing the power and control
and skill that workers have, to work to systematically reintegrate conceptualization
and doing the work. Albert & Hehnel believe
that effort and sacrifice is the appropriate measure for remuneration because they believe this is the only thing that is actually under a person's control.

Now, James makes the point that it would be possible to separate people having a quantitative entitlement to consume from this being linked to work effort. This is true. People who aren't working for one reason or another could be simply given a socially average entitlement to consume. The requirement to work is a question of social responsibility. Do we want to encourage people in the individualistic attitude of living off the work of others? I think not.

James suggests that it would be sufficient for gaining information about consumption preferences to simply tally what people take.
If there is no price and no finite limit to a person's quantitative entitlement to consume, then this will not measure their strength of desire for this product versus some other. Also, just looking at
things people buy doesn't tell us what they WOULD like to have produced. This is why parecon proposes a means of individuals putting in proposals for personal consumption items in the planning process.

Tom Wetzel

author by Andrewpublication date Sun Nov 27, 2005 20:19author address author phone Report this post to the editors

Re James

I was probably too brief in my discussion of production under communism but the central point is that goods would either be freely available (in which case they have no trade value) or for scarce goods would be allocated on the basis of need rather than ability to work. If this could be done with 100% accuracy then they would also have no trade value as those who needed them most (and who therefore would not want to trade them) would hardly exchange them. Of course 100% is not reachable - but the point is not the creation of an (impossible) perfect system but rather one which minimizes formal or informal markets. Communism clearly comes out of parecon here (and again usefully this conversation demonstrates that the two are not the same).

re Tom
I presume you object to me calliing parecon a blueprint because some old guy said socialism was not meant to be produced from blueprints. Leaving that aside it seems like a quite worked out blueprint to me that seeks to take many aspects of the modern economy into account. I don't see a reason for denying this, apart from the words of the dead guy.

On the co-ordinator class - the reason Leninism never abolished this was that it never sought to. In fact Leninn held the expansion of that class up as the fundamental building block for socialism. Anarchists disagreed with this both in theory and in practise so using Leninism to claimm some flaw in anarchism in that context is bizarre. Not to mention that right back to Bakunin anarchists wrote of the dangers of trying to create a socialist society that depended on just such a co-ordinator class. I think Bakunin referred to this as a new scientific dictatorship.

The theoretical laziness of modern anarchism means that this debate has been obscured but in fact it is still often argued in the distorted form of what are 'working class' and 'middle class' jobs. The argument of the role of teachers in terms of discipline and management very obviously relates to such discussions. But I do not think the answer to this question is complex - perhaps it is contained in the idea of open source programming?

The accumulation of goods is relevant here. For sure everyone needs their own toothbrush but whereas under communism the individual would have a tough time showing a need for more than one toothbrush it would appear under parecon they could have a much as they could 'earn'. Your not going to trade your own toothbrush - in particular as free access to tooth brushes would mean who would want your used one instead of a new one. But a system that allows you to have many toothbrushes and others not to have any clearly encourages a trade to develop where 40 toothbrushes are swapped for a CD player (for instance).

When you asy "Education and health care is not allocated according to anyone's work effort" I am not impressed. The reality is that this is already the case or close to the case under capitalism in the weatlhier European countries that have followed a strong social partnership model (Sweden, Denmark etc). This makes parecon look more and more like a social democracy that may look radical in comparison with the USA model of capitalism but elsewhere looks quite normal.

Of course a system of matching up production and needs would be required but why this would also require a measurement of individual production (something that is a measurement of what is happened, not what is to come) and a reward based on that measurement you have not made a case for. Beyond the standard case of capitalism - that individual spending power provides a measure that production should be fitted to.

Under communism it should be quite straight forward to see what good could be produced in abundance and through linking this with a JIT type system fit production to this. Then there would be the question of goods that can now be produced in abundance. Here is the diference - are production systems then best based on individual ability to work (as under parecon) or on an estimate of the level of 'need' for them. This is the 'do we build cars or buses' question and on the surface it looks to me like parecon will provide the same answer that capitalism does. Here multiplying individual solutions together gives you a very different answer to a rational decision reached collectively.

author by Tom Wetzelpublication date Mon Nov 28, 2005 03:11author address author phone Report this post to the editors

Says Andrew:
"For sure everyone needs their own toothbrush but whereas under communism the individual would have a tough time showing a need for more than one toothbrush."
Can you define what people "need"? And who is to make this determination? Sounds possibly
authoritarian.

Given the role of the TAS councils in the
self-managed industries created in Spain
during the civil war, councils that concentrated
expertise and were given directing power,
and the failure of peoplelike de Santillan
to see the coordinatorist implications of
his central planning proposals, I'm not
impressed by your defense of traditional
anarchism on the question of the coordinator
class. What's missing is awareness of
a program to avoid consolidation of its
class power. This requires a program to
sytematically reintegrate knowledge,
expertise and work, so that workers become
masters of production, not merely formally
through assemblies, but through the
development of their own capacities.

"This is the 'do we build cars or buses' question and on the surface it looks to me like parecon will provide the same answer that capitalism does."
Here you're completely ignoring the ways in which parecon is designed to
vastly increase the production of public goods. A systematic feature of
capitalism is that it under-produces public goods. That's because it is
market-governed. In parecon the geographic assemblies and federations
of them have as one function the articulation of proposals for public
goods into the planning process. In particular they have the power to
exert effective guardianship over the ecosystem. Production groups cannot
exernalize costs such as pollution onto the community because the
community effecitvely owns the ecosystem through the community assemblies
and fedeerations of these, and can force costs of pollution onto the
balance sheets of production groups. Hence all the external costs of
cars are suddenly a negative factor on the balance sheets of car production.

And you didn't answer my question about how effective allocation of
our work time and resources is possible without relative evaluations
of the importance to people of both inputs and outputs to production.
And you have in fact no way whatever to get that information in your
moneyless system.

author by Paul Bowmanpublication date Mon Nov 28, 2005 06:54author address author phone Report this post to the editors

The more I read of this parecon stuff the more it looks like the
nightmare offspring of Lenin, Alfred Marshall and Heath Robinson on a
bad trip...

A quick query in response to Tom:

"The majority of economists, both Marxist and mainstream, believe
there are only two possibilities: markets or central planning."

And do these majority of economists have a particular position on
whether the free software production process is an example of market
or central planning allocation?

Again from Tom:

"The reason for this is that you cannot have an effective and socially
responsible allocation of resources to production unless you have some
quantitative measure of the value of the resources and the relative
value of possible outputs. How do you know that what you spend time
and resources producing is the most effective use of that time and
those resources?"

There is confusion here between cost, value and price. Libertarian
communism abolishes price, evolves cost and liberates/democratises
value. The central social relation of capitalism is the alienated
determination of value by "socially necessary" labour time. In a
society freed from wage-labour and exchange people are free to
establish their values by their own choice, for example
ecologically-minded folk may value goods produced with a relatively
higher labour cost but a substantially reduced carbon cost and/or food
miles, etc. In general people may base their valuation of a given good
or service on individual or collective weightings of different cost
metrics or on aesthetic or taste grounds. We still have to order our
values by their priority to us. Where in the aggregated schedules we
see that resources are being employed lower down the value schedule
whilst there are still gaps higher up - those are the signals for
people to shift their productive time.


and finally:

"Albert & Hehnel believe that effort and sacrifice is
the appropriate measure for remuneration because they believe this is
the only thing that is actually under a person's control."

At the risk of banging my head against a brick wall again, the whole
point of the principle of renumeration that supposedly rewards effort
is that in practice it has completely the reverse effect - this is the
central contradiction in wage labour. People who get renumerated by
time spent working are incentivised to work as slowly and with the
least effort their colleagues will let them get away with. People who
make the effort to finish the work in half the time get half the
renumeration - the productivity paradox.

author by Tom Wetzelpublication date Mon Nov 28, 2005 10:21author address author phone Report this post to the editors

"There is confusion here between cost, value and price. Libertarian communism abolishes price, evolves cost and liberates/democratises
value. The central social relation of capitalism is the alienated determination of value by "socially necessary" labour time."

There is definitely a confusion here but it isn't
mine. The labor theory of value, which this
quote assumes, is a theory of price formation
within a market economy. It's a very poor theory
because, for example, it assumes that ownership
of assets by capitalists is the only relevant
factor, and assumes away the class distinction
among hired people between coordinators and
proletarians. It ignores things like market share
as determinates of price. In general I would
say that it is market clout that shapes price
in a market economy, not "labor time."

The type of pricing that a socialized non-market
economy has use of is not determined by
market clout, unlike prices within a market
system. To have an effective economy is to
have an economy that is effective, among
other things, at giving people what they most
prefer. Here I am talking about use-value, to
use the 19th century language that you seem
to prefer. What a parecon tries to do is
to ensure that the pricing system, the system
of social accounting, reflects actual preferences
in regard to outcomes, not market clout.
A relative evaluation is then encapsulated as
a relative price.

You talk about cost but don't ever really tell
us how it is measured or what it is. Now,
what I am saying is that it is a measure
of the value to us, as reflected in our desires,
of the things that could be done with those
resources.

I find your use of the example of free software
rather strange. I work for a software company
on a project producing a package for use
with Linux. You can be sure they are selling it,
with the aim of making a profit. The software
engineers who participate in free software
generation, are they anti-capitaliist? Are they
for egalitarian work structures, doing away
with the privileges of the coordinator class
in production? Not that I have noticed.

People do a variety of useful things for free.
The idea here is that somehow we are asked
to suppose this is just extended to everything.
But then we have no way of actually gaining
information from people about what they most
prefer in the way of products, in the way of use
of scarce resources. Do we really want to have
lots of people doing X rather than Y? How are
people supposed to make clear their real
preference here?

author by Terrypublication date Mon Nov 28, 2005 23:05author address author phone Report this post to the editors

Well you have a valid point in terms of how do we measure the value and demand for things. I guess the first point is that while money or the market attempts to do that and may even be partially successfull in a few areas, it is probably generally agreed that it is not an effective mechanism and is currently very distored and racked by parasitic effects.

The goal is thus to create a better system and I think the strategy that seems to be felt is to make this system somehow more democratic than it is now.

But we all seem to be looking for the theortical perfect system and are finding flaws in some aspect of every proposed system. We should accept that maybe there is no such perfect system and it would seem to me that all this discussion about trying to wipe out forms of trading which is the precursor to money, is counter productive. There seems to be a certain recognition, but unspoken, that the basic default behaviour of humans is to trade.

Rather than work against it, we should work with the tendency. So far then, correct me if I am wrong, but there's a certain consensus that social goods can be effectively social produced, but with some goods for private use (in the wants, producing and acquiring), the problem gets knotty.

This is really the similar to the situation where supposedly in a communist, anarchist or parceon society where we would have more time, there will also be some individuals who through hobbies and amusing themselves will end up producing goods that they or others want badly. It could be that you are a carpenter and put in really nice floors in your own house and make your own furniture. But your neighbour will very quickly offer some favour in return for doing their house.

There is no way we can stamp this out and presumably most people won't mind a great deal, if people do favours like this. It will really only become a problem where they neglect their 'socially' required work in preference to this since it will be apparent parasitism is at work again.

In Anarchism there is supposed to be a balance between the social and private life and the above falls pretty squarely in the private side. We may just have to accept it and deal with it, rather than trying to devise a rather illusive watertight model.

It's in the pursuit of these guaranteed theoretical models that we can all become a little dogmatic, simply because we are trying to make ensure that there is no way for the old system to come back.

author by Nilpublication date Tue Nov 29, 2005 06:36author address author phone Report this post to the editors

My problem with Parecon has always been it's technocratic leanings. It seems to suggest that political problems (meaning problems of how to structure political activity, as well as day-to-day political issues that need solving in a hypothetical society) can be solved through techical means, through a set of rules, if only it is the right set of rules. And parecon thinking then proceeds to work out in detail exactly how this set of rules ought to work, some One True System of Rules.

It privileges the technical over the political.

One reason Albert isn't an anarchist might be that he loves rules way too much.

Compare to the recent excellent essay "Fetishizing Process" by Mark Lance. http://info.interactivist.net/article.pl?sid=05/10/27/1415254&mode=nested&tid=9. Which talks about consensus, arguing that it is not the _rules_ which make consensus, but the people and their social-political interactions and what they bring to them---which the rules do not control.

Parecon, as far as I can tell, is certainly also a fetishization of process. Now, I don't think it's wrong to think about process. I don't think it's sufficient to say "In an anarchist society, everyone will be good, and that's why it will work." That's not good enough, and we DO need to think about how things might work in an anarchist society, we may not be doing enough of that these days.

But that doesn't mean that politics ARE process. There is no one process which will magically create the society we want through it's excersize, nor is there only one process which is suitable for the kind of society we want. Politics (meaning the way that social decisions are made) can not be reduced to technique--the Pareconists have forgotten the forest for the trees. To their credit, they are at least investigating questions that others think do not require investigation (they do), but their answers are usually not very deep.

author by Nilpublication date Tue Nov 29, 2005 06:43author address author phone Report this post to the editors

Part of the issue, I realize now, reading the "Organize!" review (which may not be an entirely fair way to refresh my memory of parecon, admittedly) is that the Parecon-ists seem to think that economic decisions are NOT political! Ha! That would seem to be a pretty fundamental error, certainly incompatible with any kind of communist understanding including anarchist communist understanding.

author by Tom Wetzelpublication date Tue Nov 29, 2005 10:40author address author phone Report this post to the editors

No, this is incorrect. Parecon derives from
the tradition of radical political economy.
Someone probably infers this because Michael
Albert, in his books, always insists that he
isn't going to talk about the political
institutions of a society where parecon would
exist, because he is trying to limit the scope of
his discussion.

But it doesn't follow that there wouldn't
be a political structure. And, in any event, the
questions about what type of economy we
are to have are obviously "political" in the
ordinary English sense.

author by Nilpublication date Wed Nov 30, 2005 02:05author address author phone Report this post to the editors

But this gets at an important question. Liberal (classical, neo, that is bourgesois) economics, of course, insist that economic planning is NOT political, but is a simple matter of technical engineering divorced from political context. There is an objective right way to run the economy, it's purely a matter of science and technique, best done by technicians, not a matter of political decisions (that is, of negotiating different interests and values and priorities, that may benefit some more than others).

Now, on the one hand, Parecon is a process of collectively making those value judgements socially, yes. That's it's point, to facillitate the politics (in that sense) of economic decisions in a democratic way. On the other hand, though, like I said before, it does get awfully technocratic, awfully obsessed with technique and process and engineering.

Is it really possible to discuss economic decision making institutions without discussing (other. other!) political institutions? What is the effect of segregating the discussion like this on our conception of the relationship of economics and politics? What can we know or predict of a society by considering only this segregated complex economic decision making technique divorced from it's context in many possible political and social environments? (I am again reminded of the "Fetishizing Process" article).

author by Paul Bowmanpublication date Wed Nov 30, 2005 03:37author address author phone Report this post to the editors

To address some of the clarity issues raised by Tom as to the distinction between cost, price and value.

By cost I mean the objectively measureable resources consumed in the production of goods or services. Under capitalism cost is measured in money. However there are many cost metrics that can taken. The actual labour time invested by the producers, kilowatt hours consumed, or absolute energy in terms of joules or calories. In addition we can measure costs that are less to do with resources incorporated into the product such as "carbon cost" a measure of carbon released into the atmosphere, or potentially some measure of quatity of radioactivity produced factoring mass and half-lfe. The point is that these are objectively measurable. NB the idea that labour time required is objectively measureable is nonsensical in waged production where this latter is a main source of struggle, but in non-renumerated production this conflict disappears (which is the main point really, as mentioned in the previous post).

We all know what price is in a monetary system. In general terms it is what must be exchanged for goods or services. Obviously in the absence of money or exchange there is no price per se. The distinction that products can have costs but not price is important distinction, but to see this we need to look at value.

Value is an abstraction originally devised by the classical political economists (Smith, Malthus, Mill and Ricardo for e.g.). It was these bourgeois economists who originally devised the labour theory of value. They did so for two main reasons - first to get around the impact of inflation. The problem they set themselves was to measure whether the national economy was growing or not. Coming from a background of past episodes of hyper-inflation occassioned by past governments often fairly cavalier attitude to the money supply, they realised they needed an inflation proof measure. The other reason is more fundamental and the main reason for the ongoing persitence of the ideology of labour value as "natural" or "common sense". The whole concept of exchange implies the exchange of equivalents - value is what the different sides of the exchange are "worth". In a wage economy I am not going to give you money it takes me a week to earn for something it makes you ten minutes to make - I would feel cheated whether I read an economics text book or not, even if I had never heard of "the labour theory of value". I get paid by the hour, rent is due every month, food bills need to be paid for the weekly shop. Value by labour time is the lived reality of the wage slave, not a theory.

Without getting drawn into an alternative history of the development of bourgeois economics (see my article "What Is Communism" elsewhere on this site for a beginning sketch) the attempt of the neo-classicists to ditch the concept of value altogether was not entirely successful and Keynsian and modern macro-economics has had to re-admit its equivalents to get anything done. The important thing is to realise that while it is an ideology produced by the social relations of capitalism - it is not "real" in any absolute sense. For example freely replicable "non-rival" or pattern products (music, literature, software, medical reasearch) are things that have definitive costs of production but no defineable exchange value in labour time - that's why they such potential huge profit centres in a monetary economy and why Bill Gates is the richest man in the world (last I checked anyway - could be wrong).

OK, I'm out of time. Just to mention that by abolishing exchange we can re-appropriate value as the element of human subjectivity in the economic process - i.e. as a verb, valuing as in something people do. The essence of exchange-free economics is the direct relation of the objective elements of cost with the (re-)subjective(ized) elements of value.

author by Cian - WSMpublication date Fri Dec 02, 2005 00:10author address author phone Report this post to the editors

There's a couple of different lines of argument here so I'll try and take each of them separately.. James mentioned this already, but Andrews comment about the danger of recreating class society is valid of course but the same danger exists in an anarcho-communist society.
Tom considers whether we should give a socially average entitlement to consume to those who choose not to work, and seem to decide we should not. (Maybe I have misread you here). I think, considering this is to be anarchist society, not one that forces people to do things... even if they are "socially useful" things, we should indeed give people who choose not to work some entitlement to consume. I will be more specific though.... I do no believe they should simpy get an "average" share of something like that. Things that are absolutely necessary to human survival are food, water and shelter. In my view, consumption of these items should NOT be deducted from consumption shares. The amount consumed should certainly be tracked to ensure production keeps up with demand but no-one should need to expend consumption shares on such things.
Thats my opinion, it may not be the official parecon line, but there you go....
To clarify, consumption according to need should always come first and basically, be "free to all", with the right to consume anything above and beyond this decided on the basis of effort and sacrifice.
Now briefly, on the toothbrush problem that Andrew has outlined.... I think the key to resolving this is the way goods would be distributed in parecon.... the consumer council for the area would be able to track this enormous toothbrush demand and I think someone would definetely ask.. hang on... why do we have an annual demand for 100,000 toothbrushes if there's only 1,000 people in this village/townland?
Andrew made another comment here which requires a response :

"Of course a system of matching up production and needs would be required but why this would also require a measurement of individual production (something that is a measurement of what is happened, not what is to come) and a reward based on that measurement you have not made a case for"

Hold on .... there's certainly a measure of productivity but it's only used per factory or per sector of industry to guage current production levels and to estimate from the current ones how they will need to change to match up with demand in the next 3 months or whatever.
Let me reiterate, no-one is paid on the basis of this productivity, neither a factory worker, nor the place he works in is paid on the basis of how "productive" he is in churning out whatever widgets. The income(consumption shares) of any individual is on the basis of how much effort and sacrifice they undergo, this being guaged democractically by their fellow workers perceptions of whether this person has made an above or under average effort for this time period.

Paul almost commented about remuneration :- he said "People who get renumerated by
time spent working are incentivised to work as slowly and with the least effort their colleagues will let them get away with".

Well, the thing is... in parecon, you dont actually get remunerated for time spent working.... now you would normally get extra remuneration for overtime
but only if your colleagues see you actually doing some work in those extra hours!! If you just sit on your ass for all that time, your colleagues will just bring that up when remuneration is being decided and you probably wont get a cent more. In the end, people who make a more serious effort at work would be recognised by their team as doing such and would be paid a bit more even if they didnt work crazy long hours. For instance if somebody is working until 9 o clock, but their colleague knows its because they surfed the web for the first 3 hours of the morning, they wont get any extra remuneration for that!!! Ultimately, its a socially & democratically decided reward not a rigid time/hours payment.

author by Terrypublication date Fri Dec 02, 2005 01:39author address author phone Report this post to the editors

It would seem that up complex systems have in-built into them inherent parastic tendencies and much of the discussion here around Parcecon is basically trying to deal with that.

But there seems to be an un-said assumption that it only works at the individual level and there is no recognition that small groups can also co-operate to take resources that they don't deserve -i.e. act parasitically at the group level.

For example in the last comment Cian says:
"... in parecon, you dont actually get remunerated for time spent working.... now you would normally get extra remuneration for overtime but only if your colleagues see you actually doing some work in those extra hours!! If you just sit on your ass for all that time, your colleagues will just bring that up when remuneration is being decided and you probably wont get a cent more...."

However, I have worked in places, where others will cover for their mates, so that basically a group of them will cover for each other and the net effect is they are all on the take as it were. Now I know this doesn't happen all the time and a counter argument might say well group parasitism is less frequent than that by the individual. I actually don't know if that is true or not.

Also we should acknowledge that because of social relationships -i.e. friendship or simply just not wanting to cause dis-harmony that others may not say anything and allow somebody to get paid the extra for sitting on their ass. It happens all the time.

It's certainly a very knotty problem we are trying to deal with here and some real world examples of how this is dealth with in practice would be of help.

So if anyone has real examples from some of the collectives from previous revolutions or perhaps somebody knows somebody who works in one of those worker-run factories currently in existence in Argentina.

author by Paul Bowmanpublication date Fri Dec 02, 2005 01:43author address author phone Report this post to the editors

Cian pointed out:

##Paul almost commented about remuneration :- he said "People who get renumerated by
time spent working are incentivised to work as slowly and with the least effort their colleagues will let them get away with".

Well, the thing is... in parecon, you dont actually get remunerated for time spent working.... now you would normally get extra remuneration for overtime
but only if your colleagues see you actually doing some work in those extra hours!! If you just sit on your ass for all that time, your colleagues will just bring that up when remuneration is being decided and you probably wont get a cent more. ##

Unless, of course, you're sat on your arse playing cards with the rest of your workmates - as indeed did used to happen in many workplaces in Britain in the 70s - the joke at the Trades Council meetings used to be that the reason you waited ages for a bus and then three came along at once was that three was the minimum you needed for a round of cards. The bus drivers didn't like the joke - mainly cos it was true. Ditto the work-rate of the Yorkshire miners in the pre-Thatcher era, the joke used to be that the initials "NCB" (National Coal Board) on the back of the jackets stood for "No C**t's Bothered".

The point is that if I read Cian's interpretation of how parecon is supposed to work rightly, it relies on workers policing each other. Historically wage-workers have had the sense to collaborate to reduce the work rate as much as possible in the face of management counter-strategies. Why under parecon workers would suddenly start thinking as managers is beyond me.

The whole concept of a "mixed economy" of part communism and part waged production seems unworkable to me. My feeling is that in a social relations version of Gresham's Law, the attempt to run cooperative relations side by side with competitive ones seems doomed for the competitive incentives to undermine the cooperative ones. I accept that this needs to be demonstrated at length. Another article to be written, I guess.

author by Cianpublication date Fri Dec 02, 2005 20:09author address author phone Report this post to the editors

Heya folks,
The problem of an entire workforce "dossing off" is addressed by the fedarative structure of parecon. Basically, there would be a productivity norm for instance for all coal mines of the same size using similar equipment and techniques. This would be reasonably adjusted up or down if a particular mine had old technology or was understaffed for some reason or another. If one particular workplace was significantly below the productivity norm and this was not explicable by obvious reasons, then this would need to be explained at the workers council for that industry sector. If no reasonable explanation was found, then their collective remuneration would be be reduced accordingly if a democratic vote agreed upon it. Obviously objections/appeals to this would always be possible.

You might go on to say... well what if an entire sector of industry gets very lazy and expends the least possible effort... well I admit I'm assuming that society will democratically decide to do at least enough work to allow us all to live in reasonable comfort. If you dont trust people to do this without some kind of coercive mechanism, then I fear we would be quickly heading away from an anarchist society....

Remember also... if even one person diverges from the "lazy norm", expends some extra effort, and then looks for a reward for it... (people can be greedy sometimes!!!), their workers council would have no reason not to give them extra remuneration for it, if anything it will encourage the other lazy ones to pick up the pace a bit when they see the next fellow doing well out of it. The worker could even complain or appeal to regional or industry sector level if he was finding his efforts consistently went unrewarded by his council.

Part of my problem with Anarcho-Communism is it provides no such reward for extra effort and sacrifice... those who risks their lives in their workplaces or go the extra mile get no monetary reward for it and I just dont think thats fair.

Thanks for all the replies, this is very interesting dicussion for me. :)

author by Paul Bowmanpublication date Thu Dec 08, 2005 23:24author address author phone Report this post to the editors

Cian:

#You might go on to say... well what if an entire sector of
industry gets very lazy and expends the least possible effort... well
I admit I'm assuming that society will democratically decide to do at
least enough work to allow us all to live in reasonable comfort. If
you dont trust people to do this without some kind of coercive
mechanism, then I fear we would be quickly heading away from an
anarchist society....#

I agree entirely that if you don't trust people to do enough work to
satisfy their own desires without some kind of coercive mechanism then
you are heading away from anarchism - that is why I'm against the
coercive mechanism of the wage.

When you castigate the resistence to imposed work as laziness you are
regurgitating capitalist ideology which pathologizes and dismisses the
refusal of real workers to play the role of the ideal capitalist
worker as a moral disease or degeneration rather than investigating
its real origins in the material interests of the workers in a
capitalist economy. The rotting stench of the protestant work ethic
surrounds this moralising.

Cian:

#Remember also... if even one person diverges from the "lazy
norm", expends some extra effort, and then looks for a reward for
it... (people can be greedy sometimes!!!), their workers council would
have no reason not to give them extra remuneration for it, if anything
it will encourage the other lazy ones to pick up the pace a bit when
they see the next fellow doing well out of it.#

In his "Labour Rewarded" of 1827 William Thompson noted:

"No error is more common or childish than to suppose that human
exertion cannot be produced by any other motives than those which
influence ourselves. The Competitive Political Economist feels that
the strongest motive that influences his exertions, and, from the
circumstances surrounding him and them, that necessarily influences
the conduct of most other people, is _the desire of acquiring more than
others_ [...]. The prevailing motives [...] they are pleased to term,
with all the simplicity of a New Zealander, "human nature". They
denounce as visionary the expectation of seeing human exertions
influenced by any other motives than those which actually influence
themselves. The eaters of human flesh in New Zealand and other places,
equally think that the love of vengeance and of food, their prevailing
propensities, are the only real motives that can lead to energetic
human exertions, are the real unsophisticated "human nature;" and
equally denounce as visionary the expectation of seeing human
exertions excited by any other motives than their own, paticularly by
motives so artificial as the mere love of distinctions of wealth."

To add a little anecdote of more recent vintage. In the 80s I heard
tell of a western volunteer taking part in one of the "Green
revolution" programmes of the 70s amongst the animist bush-dwellers of
Western Nigeria. His job was to go to each village and introduce these
new-breed strains of the local staple crops and explain that with the
new seed-crops the project was providing them with, the yields would
be twice as large. Given the amount of ground to be covered, it was a
year before he could call by the villages he had previously visited to
do a follow-up. In village after village it was the same story. Having
finally been convinced that the new crop strains would produce twice
as much the locals had only planted half the fields. Perfectly logical
behaviour - just not capitalist logic. The western volunteer retired
disillusioned in his belief that scientific crop-boosting was going to
eliminate poverty in the so-called Third World. The geography teacher
who relayed this anecdote opined that the "problem" was the lack of a
cultural equivalent to the protestant work ethic amongst the animist
Nigeria tribespeople. Nuff said.

But in order to complete our deconstruction of the capitalist ideology
of motivation by unequal renumeration, we need not only to demonstrate
its ideological and socially-specific nature, but to expose why
workers resistence to its supposed incentives is not produced by moral
deviance but by real rational interests. I.e. what I term the
productivity paradox is that the capitalist incentive system actually
produces "laziness" as a defence mechanism by the workers against
exploitation.

Productivity is not about increasing production by increasing the
amount of time worked. Productivity is about increasing production by
reducing the amount of time worked per unit of output. The problem is
that in a system of renumeration by time worked, an increase in
productivity penalises the innovator rather than rewarding them. That
is, if the innovator passes on the fact of their breakthrough to the
wider society. Alternatively they could conceal that information and
accrue a benefit by reducing the amount of time they needed to work to
get their standard renumeration or icrease their renumeration while
still only working the average day. Given the risks of being noticed
associated with the latter course of action, the safest option is to
reduce the amount of time worked for the standard wage. Eventually
this propogates around numerous work teams and eventually you have a
generalised state of not much work going on governed by formal paper
statistics of standard productivity levels that everybody knows to be
fictitious. A condition not unlike production in the Soviet Union,
that failed historical exercise in waged "socialism".

author by Jamespublication date Mon Dec 12, 2005 00:31author address author phone Report this post to the editors

Tom:
"James suggests that it would be sufficient for gaining information about consumption preferences to simply tally what people take.
If there is no price and no finite limit to a person's quantitative entitlement to consume, then this will not measure their strength of desire for this product versus some other. Also, just looking at
things people buy doesn't tell us what they WOULD like to have produced. This is why parecon proposes a means of individuals putting in proposals for personal consumption items in the planning process."

Nope, I don't mean to suggest this, though it will be part of the data inputted to see what ought to be produed in the future. (By itself prices don't do this fully either; they will indicate preferences among available products but not tell you much about stuff that hasn't been produced at all.)

In fact I think it's a strength of Parecon that it recognises that past production and preferences doesn't necessarily tell us what people would like to have been produced. I agree that it's important to have a means of individuals putting in proposals for personal consumption items in the planning process. I just think this is a quite a separate question from renumeration for effort, which you agree with, I think!

Speaking of which...
Tom:
“My own belief is that a revolution would require an incredible amount of solidarity and that workers would be likely to give each other slack, and not want to make any minute judgements of this sort. Nonetheless, I also think that workers would resent it if people in their workplace were obviously shirking, stealing things, etc. And it is quite reasonable that it would be the responsibility of the production groups to deal with this.”

Again, I agree. But if there is an incredible amount of solidarity amongst workers then it shouldn't be necessary to construct a system of renumeration for effort, i.e. to structure the system in such a way that anticipates the worst. By all means, have fallback systems if abuse sets in (i. e. the exploitation of others' labour and accumulation of wealth should be minimised), but I'd hope, for reasons stated above, that it won't be necessary. It could be counter-productive as it could undermine the solidarity which is necessary for a revolution to survive.

In my experience when people are doing useful work from which they get a bit of satisfaction, then lazing around isn't a big problem. On the whole Parecon's proposals for mixed jobs, and hopefully a shorter working week should by itself minimise problems.

author by Cianpublication date Tue Dec 13, 2005 02:02author address author phone Report this post to the editors

Hi again,
Paul,
You mention that I castigated the" resistance to imposed work as laziness" in my last post. But, at no point did I suggest that in Parecon there would be an "imposition"of work on anyone. Forcing someone to do work of whatever type is not something I think any anarchist would advocate.

As for the "laziness" part, I was not trying to make a stirring defense of the protestant work ethic, that is the last thing I would advocate!!

Crucially, In talking about "work" here you fail to make any distinction between work in a capitalist economy and work as it would happen in Parecon.
But yet there are enormous differences!!

What I would regard as laziness is if some people decided they were unwilling to expend even the minimum of effort either to provide food for themselves and family or to repay the efforts of farmers who were providing them with the means of existence. This sort of thing I'm sure you will agree would be exceedingly rare, but cases of "social loafing" like this do happen in practice. If you read about the histories of any of the american utopian communities it is a recurrent problem they had to deal with.

You used the word "wage" several times when talking about work under Parecon which implies that you believe some kind of wage-labor situation is occuring in Parecon. I'll make a couple of points to try and explain why the "consumption credits" you receive under Parecon do not amount to a "wage" in any sense.
(1) No-one is forced to work in an anarchist society under Parecon.
(2) One can choose not to do work and still have ones needs provided for :- food, water, shelter, health care needs do not require consumption shares - production is for NEED not profit!
(3) The means of production is socially owned, no-one makes any profits from production or pays anyone a "wage" based on their productivity.
(4) Income disparities under Parecon would likely be very small... most people would earn exactly the same. Only if you worked in hazardous environments or expended extraordinary effort would extra remuneration be due. At the very most this might amount to maybe 1.5 times, or at most double the usual remuneration but I expect this would be very rare indeed!
(5) Balanced Job Complexes would ensure that most people received roughly the same remuneration and had a job complex that combined both rote and empowering tasks in equal measures.

Given all the above, I fail to see how the word "wage" is an appropriate term.

The example you give of the Nigerian farmers is good and its exactly what I would expect to see happening under Parecon. I dont have any problem with it at all. The farmers were simply adjusting work effort downwards to match the necessary demand.

In a Parecon, there might be a consumption demand for say 1000 tonnes of paper. Now lets suppose, it takes 6 hours of effort by paper workers in each plant to produce this.
Now lets suppose an innovation was discovered that meant that only 3 hours of work would be necessary to meet this demand. It would make sense for the worker who discovered this to spread this idea - it would mean he and his fellows only need to spend 3 hours working at the paper plant, instead of 6. The overall level of necessary work in society would thus be reduced, something that is in everybody's interest!!
Balanced Job Complexes would mean that work in other areas could then be taken up for the other 3 hours, or even that the overall societal norm for work effort be reduced. The working day might even be reduced by a half hour or so, if productivity was such that demand could be met this easily...

Remuneration for effort is not intended to be the only motivation for working, I never suggested such a thing. I am well aware off the many others reasons people have for working :- personal satisfaction, contributing to society etc etc.
I advocate remuneration for effort and sacrifice not because I think this is necessary to give people an incentive to work but because I think its fair to reward people for these things.

author by Michael Kearnspublication date Wed Dec 14, 2005 13:45author email Michael.J.Kearns at studentmail dot newcastle dot edu dot auauthor address author phone Report this post to the editors

Near the beginning of this thread Eli asked:

"As for other lurking pareconistas out there, has anyone figured out if owning a home works at all in a parecon, or would that be an unfair ownership of productive capacity? I'd love to hear some ideas on that one, particularly in a transition phase (from capitalism to parecon)."


Here are some relevant quotes from some pareconistas:

(from the vancouver parecon collective)

" In a parecon, private ownership of the means of production would not be allowed. People would own things like houses and toothbrushes, but not workplaces"

http://vanparecon.resist.ca/parecon_files/parecon_leaflet_newestQA.pdf.

(from ZNet Institutional Racism Instructional
Justin Podur (2002) )

"In a participatory economy no one owns any productive property. Incomes are equalized to the overall average with deviations for effort, but property ownership does not exist. ....
A parecon does allow personal property, however, including personal homes"

http://www.zmag.org/racewatch/znet_race_instructional9.htm

(from Albert Replies to Green
by Michael Albert )

" Green says, "Parecon does apparently allow individual ownership of some private possessions. But it's not clear what the extent of this is. For example, could anyone own an individual home? Or is everyone a renter? "

Of course we own almost everything we own now, clothes, chairs, whate have you -- though we get it by very different means. One could imagine a parecon with only renting, or with home ownership. These are blueprint details, in my view. Both can be consistent with the defining relations of a parecon. What wouldn't be consisten is me owning General Motors. "

http://www.zmag.org/content/showarticle.cfm?SectionID=26&ItemID=4426



I disagree with these views - I think that:

(i)
Because parecon is so different from capitalism, with many currently familiar features of the economy like banks, ownership, money and division of labour either being absent or existing in fundamentally different forms, simply saying that parecon does or does not have 'ownership' or 'renting' of personal homes isn't very informative.

For example, how can I know, from the above quoted statements (which btw are all the authers of those statements seem to have said on the topic), whether, as Eli asked, if owning a home works at all in a parecon?

(ii)
If 'owning' and 'renting' do mean something like they do now, then all the things that are wrong with them now would still be wrong with them in parecon.

Personal housing represents a considerable chunk of the capital stock of a country, and the changes over time in the relative values of individual units of housing will vary widely due to differing efficiencies in construction (by building workers councils, and due to differing skill or personal preferences on the part of those making the choices of what to build) and rates of depreciation, differing effects from changing preferences, and most of all from the differing positive or negative affects of individual and collective actions on the characteristics of the area in which the house is located .

So with private ownership of housing, large differences in wealth which have little to do with the preferences and nothing to do with the efforts, of individuals, will inevitably arise. Likewise, ownership of multiple units of housing, inequitable inheritance, exploitive self-management-violating conflict-inducing landlord-tenant relationships, use of housing for capitalist businesses, (perhaps) housing bubbles/crashes, etc would all occur if ownership of houses meant what it does today and was permitted.

'Profitable' housing investment oppertunities would make charging/crediting borrowers/savers with a compound interest rate necessary to balance savings and borrowings, leading to further growth in inequity.

No doubt all these problems could be greatly alleviated by appropriate regulations, but such regulations would be unlikely to fully solve the problems, and would probably not be fully applied in the first place, for reasons such as the legitimacy which would be given to 'doing what one wishes with ones property' by collective approval of ownership of housing.

(Also since if everyone started off owning a house, there would, in time, be some not owning a house, but renting from others who owned several, so owning and renting would not be an either/or thing).

If everyone in a parecon was a renter, then presumably this means that they don't have much decision making power over how to design or modify their home, and possibly don't have much security of tenure either. Denying these rights is clearly a violation of self-management.Who would decide, in a parecon, whether somebody could continue to stay in the house in which they were living or how that house would be modified, if not the people living there, anyway?

(iii)
A desirable option for parecon vis a vis homes can be clearly described, but is neither 'owning' nor 'renting' as currently understood.

Rights to occupy units of housing of each particular variety in the coming year would be allocated via participatory planning. The supply of each variety would be the current housing stock plus changes due to building and renovation planned to be carried out (by building workers councils).The demand for each variety would be the requests from consumers.Excess supply or demand for a type of housing would lead to IFBs adjusting indicative prices down or up.By the end of the participatory planning process supply and demand for each variety of housing will be equal and a final set of indicative prices reflecting the true social benefits and costs of each variety will have been arrived at.

Consumers who did not wish to move house would simply request a unit of the variety of housing that their house is.So provided they are willing to be charged the applicable indicative price in each year they live there, someone could stay in the same unit of housing for as long as they wish.

[Ie there would be security of tenure.Since there would of course also be no owner ( or anyone else ) to which the indicative price for the use of a unit of a particular variety of house would be paid, this situation I have just described is not like current day renting.
Obviously it is not like current day owning, either.]

Consumer who wished to move during the year would request a unit of the variety of housing that they had already decided to move into or would be most likely to choose.
[Michael Albert and Robin Hahnel have already suggested a Housing Facillitation Board to help match up soon-to-be unocupied houses and people planning on moving.]

If they wished, consumers could choose who would occupy a house after they died or moved, subject to anti-discrimination laws and the willingness of the designated 'inheritor' to be charged the applicable indicative price.

Investment in housing would take place in a similiar way to investment by workers councils.Occupants of housing could propose investments (ie construction of new houses or changes to existing ones), which would be approved by consumers councils if their social benefits met or exceeded their social costs. The social benefits would be the estimated net present value of the increase in future indicative prices for using the housing as a result of the investment. The social costs would be the indicative prices of the required services supplied and materials used by the house building (or renovating, etc) workers councils who would carry out the new building/improvements as decided by the occupants of the housing.

One special feature of investment in housing could be to allow the shortfall in net social benefit of disaproved proposals to be charged to willing proposers in return for approval, in order to make idiosyncratic choices about how their homes would be built or renovated possible.[Note that this would provide no rationale for 'ownership' of the resulting houses or improvements since the full social value of the construction would still be being payed for by society as a whole]

Building wcs could also request (in the particpatory planning process) empty blocks of land or existing houses to build on/improve
,to designs they believe will meet the needs of consumers (eg based on information from consumers councils) , and have the estimated increase in net present value counted as part of their social benefits.

Consumers councils would play their usual roles in research, consumer information and protection, etc for housing as for other goods and services.

In summary this option would ensure self-management in housing investment and occupancy decisions, without the various problems of private ownership of housing.
No doubt the exact features of this option for handling housing in parecon are 'blueprint details' that will vary among different participatory economies.However I do not think that having some way of handling housing in parecon in a desirable way, rather than in the undesirable ways implied by 'renting' or 'owning' , is a blueprint detail.


During a transition from capitalism to parecon I suppose existing ownership titles would become void, and a system for dealing with housing like the one I describe would be set up, along with the rest of parecon, but I don't have many ideas about this. Perhaps tax records, etc could be used to work out how much consumption in excess/short of that warranted by effort (soon-to-be-former) capitalists and coordinators/workers had had in the past, and then initial borrowing/saving amounts could be set to offset this (to the extent possible without putting any former exploiters below the poverty line, of course).
This would automatically tend to compensate any deserving former working class former owners of average, aquired-by-hard-work-over-the-course-of-several-decades homes ( for the fact that they would now be paying use-rent ).

author by Tom Wetzelpublication date Wed Dec 14, 2005 15:16author address author phone Report this post to the editors

Those who have objected to remuneration
for work effort and sacrifice object that "people
aren't being trusted." This misses the point.
The problem is that there is no way whatever
to obtain information about what productive
outcomes would be most preferable to people
unless people must make choices for goods
and services within the limits of a finite budget.
If we use resources -- our labor time and materials --
to produce X, we can't use those resources to
produce Y. How do we know people preferred
X over Y? Again, the only way is if people have
to make choices within the context of a finite
share of total social production. Each person
in fact will have only a finite income no matter
what, in the sense that each will consume a
finite share of the total social product. The
problem with a moneyless economy is that it
simply can't provide us with the required
information.

On the question of the political structure,
my own view is that the building blocks
of a parecon economy -- workplace assemblies
and neighborhood assemblies -- also
provide us with the building blocks of the
polity. We could envision the polity as based
on federal congresses of delegates from
the neighborhood assemblies, for example.
There is, however, a distinction between
the economic and political role of the assemblies
and federal congresses. This is because
the economy is a system of negotiation
between people as workers and people
as consumers and residents. The geographic
assemblies and federations of these, in their
economic role, generate proposals for the
production of public goods (health care,
housing, parks, education, etc). But in
their political role, they have the power to
make the basic rules or laws, and the
enforcement of these. For example, the
geographic bodies are conceived of in parecon
as the stewards of the ecosystem and have
the power to protect it. What's not clear to me
is whether the political power should derive
from the workplace assemblies, or only
the geographic assemblies, or jointly.

On the subject of housing, there is really
little reason to continue ownership of houses
in parecon, except as a holdover from the
preceding system. The reason for this is
because housing production is typically
financed through debt, from banks, in
developed capitalist countries. But parecon
does away with interest, and the resources
that are allocated to construction of housing
are simply allocated directly in that year's
budget. This being the case, there'd be no
mortgages. However, as a system of
generalized self-management, this applies
to housing also, and I take this to mean
that houses and housing complexes would
be self-managed by the people living in them.
We could imagine that, in the construction of
new houses, there is some process of
participation in the design of the housing by
the people who are going to be living in it,
as part of the participatory planning process
in that case. What people might be required
to pay for the housing would presumably be
something like the operating and maintenance
expenses. I'm here assuming that we're treating
the housing like a public good. Although there
is no need for a concept of "ownership" of the
housing, I could easily imagine a principle
of security in tenure, that one's house can't
be taken away unless you're given some
equivalent (if for example your house happens
to be on a site needed for some community
purpose and the community wants to move you).
All of this is quite speculative however because,
as I said before, parecon isn't intended as a
blueprint but as a specification of merely a
structure, that is, a particular mode of production.

author by a johnstone - Socialist Party of Great Britainpublication date Mon Jul 03, 2006 04:06author email ajsc21755 at blueyonder dot co dot ukauthor address edinburgh scotlandauthor phone naReport this post to the editors

The main feature of parecon appears to be that consumer and
workplace councils will set prices or the exchange values of
commodities, which will include the commodity labour power or wages,
and that they will be free to set any prices that are democratically
deemed fit.

Another feature of the system is that remuneration for work will be
equitable or fair with remuneration based on effort or difficulty of
the task or whatever. This second feature is actually the essence of
the system and is what needs focusing on in order to understand how
it might actually work as opposed to how it is intended to work.

With the introduction of equitable remuneration for work, we are not
in fact talking about a new system but in fact a return to a very
old one. This system incidentally led to the introduction of
capitalism in the first place as carefully recorded and explained in
Marx's work Capital. However I shall leave that aside for the moment.

Equitable remuneration for effort, however it is calculated, is
merely a return to the central feature of the "Law of Value" that
set the value, exchange value or in colloquial terms the price of
commodities or goods and services according to the socially
necessary labour time or effort required to produce it.

Far from the parecon position that there will be no market in
parecon world and that councils will democratically set prices, I
contend that market forces will exist, there will be a market for
labour power, and that will ultimately set prices. If the
remuneration for a type of work is set too low the workers, the
labour market, will decline to accept the employment for more
financially rewarding options.

If it is set too high the workers will compete for the work and see
that this work is not equitably remunerated. The natural or true
value of the labour power, wages, will be that value at which the
supply of labour power is balanced by demand.

This is presuming that in parecon world there will not be rationing
and restricted or forced labour and such like, features of the old
soviet economic system.

In order to understand how Parecon would operate we need to break it
down into simple idealized models to give us insight to the dynamics
of what would be a complex system.

We need to take first as a starting point a uniform or homogenous
type of labour that would receive the same remuneration per labour
hour performed. For simplicity sake I will start with unskilled
labour and will deal with relative remuneration for skilled labour
later.

If unskilled labour of a standard intensity of effort, standard
unskilled labour, is to receive one pareconite per hour as a unit of
remuneration we can begin to analyse the price of commodities that
this labour produces.

When one starts this kind of thing one always struggles to find a
beginning in a chicken and egg paradigm, so we often have to have a
premise that we can always start with and check again later after a
bit of analysis. We start with premise that remuneration of labour
power and price of raw materials are set.

If we are to produce a commodity with standard unskilled labour at 1
pareconite per hour the raw material that is used will have a price
or value. The price of this raw material for the moment will be just
given. Set according to the parecon theory by councils although as
we will see later I will dispute that.

If the raw material costs 10 pareconites and 10 hours of standard
unskilled labour hours are used to convert it into another
commodity, 10 pareconites of standard unskilled labour power will
need to be purchased to produce the commodity in addition to the
cost of the raw materials. The "cost of production" of the produced
commodity will be 20 pareconites. Up until this point the council
Pareconists will have no choice about the matter. They do appear
however to have some choice about what they decide to sell the
produced commodity for, or in Marxist terms the "price of
production".

The option of selling or exchanging the product for less that 20
pareconites does not seem to be viable however it is worth
considering. If it is decided to sell the product for 15
pareconites, it will be necessary to pay the workers 5 pareconites
for 10 hours standard unskilled labour time. If the workers are
offering their labour power based on how it is remunerated, selling
their labour power as a commodity on the market, they will withdraw
from this form of remuneration and seek more remunerative
possibilities elsewhere. If they are allowed to that is, unlike the
soviet system.

The alternative freedom that the council Pareconists would have is
to sell the product above the cost of production at lets say 30
pareconites. Where the extra 10 pareconites would go is limited to
several possibilities. The workers could get the extra 10
pareconites but I imagine that this would be unacceptable as it
would mean that they were getting more remuneration for the same
standard unskilled labour than other workers.

Or to put another way one worker would be exchanging the product of
10 hours of their standard unskilled labour for the product of 5
hours of somebody else's.

The other possibility is that the extra or surplus pareconites could
go to the state or a communal fund to pay for social "non
productive" activities like healthcare or education. In this sense
it would be acting like a kind of consumption tax that is levied
today in capitalism. Indeed the Pareconists may well levy this tax,
democratically of course, on harmful products like tobacco and red
wine to save and discourage stupid people like myself from harming
themselves, who knows.

The third possibility is that the enterprise or productive unit may
be allowed to keep the surplus pareconites to re invest to expand
production. In fact there is a perfectly sensible and all too
familiar intrinsic logic to this.

Lets go back to the original situation of raw material costs 10
pareconites and 10 standard unskilled labour hours or 10 pareconites
produce a product with a cost price of 20 pareconites. Lets suppose
that this is a wonderful product much in demand, I will deal with
the opposite later, and our council Pareconists set the selling
price, price of production at the same as the cost of production, 20
pareconites .

Our willing consumers, the market, snap this wonderful product up as
soon as they can get their hands on it, even forming queues in shops
just like under the old soviet system. Some kind of rationing system
could be appropriate here and to be even handed we may have similar
problems in free access socialism.

The sensible solution for the council Pareconists however would be
in fact to raise the price of this "over demanded product"
significantly above its cost price thus limiting and curbing demand
at the elevated price. The surplus pareconites could then be
sensibly used to purchase more means of production and perhaps
slightly increased levels of remuneration for the workers in this
industry to attract more labour in order to expand production and
meet demand. In the same way as it does under capitalism.

As production levels were increased prices could be lowered by the
council Pareconists to re equilibrate supply and demand. However it
would be an illusion that the council pareconists would be setting
the price but the market just like under capitalism.

Eventually the price of production or the selling price of the
commodity would re equilibrate to its natural or market value as
production levels increased, ie supply. The market value being
socially necessary standard unskilled labour time necessary to
produce it (plus the fixed cost of the raw materials whose price or
exchange value would be set by the same process) ie 20 pareconites.

The alternative situation is somewhat unpleasant and involves over
production and sacking parecon workers. If our same workers are
producing a product that needs to sell at 20 pareconites to break
even and the parecon consumers won't purchase all that they produce
at that price all will not be well.

The revenue from sales will not match costs, labour and raw
materials and production will have to be curtailed. The workers
services will no longer be required and they will have to seek
career opportunities elsewhere. They will be sacked. The supply of
the product will be reduced until supply meets demand at the price
of production ie when all the product can be sold. The labour time
that is expended in over production is not socially necessary and
therefore something has to give.

For some of you this may sound vaguely familiar, just like
capitalism. Could it be that it is not the council Paraconists that
are really in control and setting the exchange value of commodities
but the "market" or the law of supply and demand that enforces
Karl's law that the value of a commodity is set by the socially
necessary labour time required to reproduce it , and not by council
Pareconists.

There is the much more difficult question of relative remuneration.
Why is it in capitalism that one workers commodity, their labour
power, is worth more than another's. Why is it that a computer
programmer's commodity, their labour power, is worth more than a
sweat shop labourer in Indonesia and how does this effect parecon
world.

Karl stated on several occasions that his Laws only applied with the
condition of the free movement of labour and capital. I think it is
clearly the case today that we are not in a situation of free
movement of labour or to a lesser extent capital. I think there are
complex reasons for this that benefits the capitalist class.

However we could imagine the impact of the free movement of labour
or in the opposite direction the free movement of capital might have
on the wage levels of unskilled labour in the first world. In fact
we do easily see the impact on the free movement of capital on the
position of first world workers with the "outsourcing" of
manufacturing jobs to places in China and such like.

But back to Parecon land and the relative remuneration of skilled or
specialized and unskilled labour.

Lets suppose that a new product became available that required
specialised skills or training to produce. At first this product
would be much in demand and there would be insufficient workers with
the skills to produce it. How would the council Pareconists set the
price of these workers product?

These workers may well accept any wage that is given to them by the
council Pareconists they may even accept the same rate as the
standard unskilled labourer. However with an insufficient number of
workers with the required skills they will not produce enough
product at that price to meet the demand for their work, as there
are not enough of them.

The council Pareconists will either have to increase the price of
their product to curb demand or introduce rationing. In the case of
increasing the price of the product this will involve paying these
workers more, encouraging other workers to acquire the skills for
this more remunerative work. As goes on under capitalism. The
alternative would be for the enterprise to sell the product at a
price well above its cost and make an excessive surplus value, or
profit or a combination of the two.

The pareconists could argue that these excess profits could be set
aside by the state or even the enterprise itself to retrain workers
and thus increasing the supply of that type of labour power. This
would reduce the effective demand for this type of skilled labour
thus depressing the market price that these workers could demand for
their labour.

It is not hard to find reformist politicians and advocates for the
smooth running of capitalism complaining of skill shortages and
proposing the "social" retraining of workers. Although they fail to
mention that their real motivation is to reduce the wages of the
skilled labour power that is irresponsibly taking advantage of the
capitalists.

It would appear that Deleon had a much more sophisticated and
intelligent understanding of this issue than the pareconists. Deleon
seemed to accept the wage levels or non exchangeable labour voucher
remuneration would be set by the supply and demand of the particular
type of labour required and that would set the price of the
commodity produced by that labour.

As the value of commodities ultimately depends on what is used to
produce them or what they are, human effort, their price will be set
by the socially necessary labour time required to produce it. The
table will be worth the same as 10 pairs of shoes as they both took
an equivalent amount of human effort to produce.

The fundamental problem is, as soon as you accept that labour power
is a commodity, something that is paid for, fit for remuneration or
exchange on a market, then everything else becomes the same. Under
the Law of Value the cost, price or exchange value of everything
depends on the amount of human effort or labour that has "gone into
it" or is embodied or crystallized in it.

The issue of different amounts of capital invested in different
enterprises producing the same product would also raise problems in
parecon world. If one enterprise so happened to have better machines
that enabled 1 unskilled labour hour to produce twice as much as the
same unskilled labour hour in another factory it would be able to
pay its workers twice as much as the other factory with less
capital. Otherwise the factory with the larger amount of capital
could pay its workers the same but it would make more surplus value.

This excess surplus value could be taken from one enterprise and
redistributed to another, in fact it would have to otherwise
something far more insidious might happen, capitalism proper.

The workers council in a factory may well see that by paying
themselves less than they produce, generating surplus value for
their enterprise, they may obtain an advantage over a rival factory.
If they invest the surplus value in labour saving machines, capital,
they will be able to produce more and therefore more revenue for the
same amount of effort.

If they don't and their rival does the opposite will occur and they
will find themselves working harder for less. Thus the workers
parecon councils in each enterprise will be driven by the
competition intrinsic in the remuneration money system to behave
just like the capitalist class. To suck vampire like as much surplus
value out of themselve as possible to serve and expand capital.

It looks like we have some illuminating revelations from Parecon
land

" First, there is the indicative price. Price in Parecon is the
effect of participatory decision making from the workplaces. If
something has a high social cost, like cigarettes, the medical
workers need to talk to the tobacco workers and include health costs
in the cost of cigarettes. Why? Because why should doctors and
nurses work more than they normally would because some other product
is making people sick? You have to pay the doctors right?"

So we are going to have consumption tax as I speculated and those of
us with self destructive habits will have to pay for it, fair enough
I suppose as far as it goes.I suppose we could also have a "fat" tax
that is in the news at the moment on this side of the pond.Of more
interest I think is;

"And if a product requires onerous work, we have to pay the workers
more, and the price for that product is higher to reflect this."

Ah good, so we have an acceptance of the labour theory of (exchange)
value. But if the "price" of a parecon commodity is a refection of
the socially necessary labour that has gone into it then the price
of a commodity will be the effect of that and not of "participatory
decision making from the workplaces."

And;

"If you want to consume coal and you have to pay more, you would
think twice."

Yes indeedy, to each according to the size of their pay packet. It
looks as though everyone will be paid the same according to labour
time basically. Perhaps paying someone more labour time for onerous
or unpleasant tasks thus;

"We also pay more to people who make sacrifices by working under
poor conditions. If you work as a dishwasher in a kitchen of some
restaurant, we should pay you more than we pay, a lawyer for
example."

Does this mean we will have "lawyers" in Parecon Land?

"The indicative prices reflect the social cost of the product"

labour time;

"but in the negotiation process, if the demand exceeds the supply,
the price could go up."

Back on more familiar ground.

"This will encourage consumers to find cheaper alternatives,
therefore demanding less, or the producers may decide to work
longer, harder, or create new workplaces in order to increase
production to meet demands."

Looks like I got this bit right as well not bad as I haven't read
the book. Maybe as I speculated the increased surplus value
generated by raising the price above what is required to "have to
pay the workers" or the "the social cost of the product" could be
ploughed into expanding capital in that sphere of production
increasing supply and thus reducing price to Adam Smiths natural
price. I am sure Adam Smith and Karl could understand this quite
well.

"Indicative prices help demand and supply converge in the end.
Computing and communicating prices is the job of the IFB."

A case of the cart before the horse I think.

It also seems that with the ideas presented in this article, the
best I have seen yet, is that whole industries will be grouped
together to prevent the problems of differential advantageous
accumulations of capital. Something absolutely essential, or in
other words as I said I think, the production unit with most capital
and advantageous production facilities would effectively subsidise
the others.

Not bad, I am quite pleased with myself.

http://www.zmag.org/content/showarticle.cfm?SectionID=26&ItemID=10440

David Balmer

http://groups.yahoo.com/group/WSM_Forum/message/30376

Related Link: http://www.worldsocialism.org/spgb/
author by Tom Wetzel - WSA (personal capacity)publication date Mon Jul 03, 2006 05:53author address author phone Report this post to the editors

This person can't seem to undertand something that doesn't fit into the old set of ideas he is working with. The workplace assemblies do not "set" prices in a participatory economy. Nor are prices set by market exchange. Market exchange could happen only if the production groups could acquire revenue from sale of their products -- but they can't in parecon. Market exchange is a system of allocation of resources in production by bargaining power. This presupposes autonomous control by the production units...something that doesn't exist in parecon. When a revolutionary movement sets up a participatory economy, it must set up a set of planning rules for determing prices. It is these rules that would determine what a price would be. The rules would determine prices based on projected supply and initial demand, as revealed through proposals in the planning process. It's part of a process for determining a social plan. There is no place for any group to use autonomous market clout since there is no autonomous control or effective posssession of means of production. Means of production are owned in common by the whole society, in sofar as they could be said to be "owned" by anyone. It would be just as valid to say that "ownership" is no longer a relevant description. Projected supply is whatever production groups initially propose to produce for the community. Initial demand is whatever requests individuals and community assemblies and federations of these. If production groups do not propose to raise supply but there is an increase in demand from community groups, the rules would say that the price goes up. It isn't a question of anyone having the power to arbitrarily "set" prices. Prices emerge, according to the agreed upon rules, as a reflection of proposals for production work and requests for products.

The author of this comment completely ignores a central component of parecon: job balancing. No doubt he does so because, like marxists in general, he has no concept of the coordinator class. The coordinator class is the ruling class in the Communist countries, and is an intermediate class within capitalism. The working class is subordinate to this class. The power of the coordinator class is due to its relative monopolization (accumulation) of levers of decision-making and other forms of empowering work, that is, work giving it power over other workers. To dissolve the power of this class, parecon proposes that the democratic workplace organizations would implement systematic job redesign, and expanded education, so as to increase the knowledge and skill of workers in general and distribute the empowering tasks throughout the workforce. As a result of this process, the relative onerousness and effort required in jobs would tend to be equalized. Hence, other things being equal, the rule that income of able-bodied people is to be based on their effort and sacrifice in socially useful work would lead to equal rates of remuneration. However, if two production groups consume the same social inputs and produce different levels of output, and have the same capacity, as measured by things like equipment and education, we can infer there are different levels of effort the groups have provided. This will lead to less allocation of resources to the group that is underperforming. This provides them with a motive to provide more effort. Without a motive to work effort, we can't reasonably expect that the economy will avoid a catastrophic drop in production.

The claim that capitalism is supposedly based at its point of origin on a system like this is utterly idiotic. Capitalism was based from the very beginning on private ownership of productive assets and allocation by market bargaining power. Neither of these things exist within parecon.

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