Re: Bolivia, Nationalization, Socialism, Communitarianism
Posted by Steve Welzer on 05/03/06[This is adapted from a post on the NJGreenTalk discussion e-list. The debate reflected here goes on and on without yielding much in the way of ideological budging. The socialists stay socialists and the communitarians stay communitarians. In his book, The Structure of Scientific Revolutions, Thomas Kuhn made the point that believers in a discredited paradigm don’t tend to get enlightened, rather they just die off and get replaced by advocates of a new paradigm!]
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NJ Green Talker “A” wrote:
> I, for one, would like the leadership
> of GPUS to consider calling for the
> nationalization of the US oil industry.
NJ Green Talker “B” responded:
> ... why would anyone want a government
> that can’t even efficiently run itself
> to run the oil industry?
Here was my reply:
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I don’t trust either the nation-state governments or the private cliques who own/control the corporations to run any economic enterprise in a socially and ecologically responsible manner.
Under capitalism private cliques own and control the major means of production. Even in a “public” corporation where the stock is widely held, the vast majority of stockholders each own too small a percentage to have any input into the running of the enterprise. Typically a few dozen individuals, at most, own enough stock as to dominate the Board of Directors decision making. Macro-consequential decisions for enterprises that affect thousands or millions of people (as employees or consumers-of-products or members of communities where production facilities are located) are made by tiny, elite, self-interested, controlling Board members and their beholden managerial staff. Obviously that’s not democratic and inexorably it results in obscene concentrations of wealth and power.
Under socialism the government owns and controls the major means of production. Historically, there have been a handful of revolutions involving dramatic wide-scale expropriations, but most democratically elected socialist regimes have moved toward changing the balance between private enterprises and public enterprises through a gradualist program of nationalizations.
Is Green Talker “A” right to say that we’d be better off if the oil industry was nationalized? Or is Green Talker “B” perceptive in disdaining governmental control?
Socialist theory and aspirations centered on the idea that with collective ownership the general interest could be represented and the economy could be subject to democratic control. The reality, to date, has been less than satisfactory. Government ownership has tended to be bureaucratic and, at the large scales found in a modern industrial economy, governmental control has been remote and often unaccountable. The opaqueness of centralization allows power elitism to continue to flourish, almost to the same extent that it flourishes under capitalism.
I say “almost.” At least the principles of socialism strive toward egalitarianism (whereas capitalism accepts class division of society as natural, normal, or inevitable). If the only two choices were socialism and capitalism, I guess I would choose the former. But those are not the only two choices, as I’ll discuss below.
Should Greens support nationalizations of enterprises or entire industries? The answer may be dependent upon the specifics of circumstance. There are cases where, among all policy alternatives, nationalization might constitute a supportable reform.
On May 1 Bolivia moved to regain majority control over its energy production. President Evo Morales said: “The time has come for Bolivia to retake control of our natural resources,” decreeing what he called a nationalization of the natural gas industry, currently operated by Brazilian, Spanish, French, and American corporations. Morales said foreign companies must turn over most production control to Bolivia’s state-owned oil company, Yacimientos.
Bolivia could have moved toward more stringent regulation and/or a degree of control through legislation which left ownership formally in private hands. Government ownership may or may not work out better. This remains to be seen, but the Bolivian masses should have no illusions that it will result in “power to the people.”
Socialists might say: “What we advocate is for workers to have ownership and control - not the state or the government bureaucracy.” But the reality has never conformed to that ideal. I don’t believe it’s possible for tens or hundreds of millions of people (a nation-state population) to have any meaningful sense of ownership and control of a vast industrial economy.
Socialism has high ideals, but I’ve become convinced that those ideals cannot be realized within the context of large-scale polities and economies. Some contend that the vision just hasn’t been fully realized yet. But after 150 years of attempts to implement socialism - in countries as diverse as Russia, China, Britain, Sweden, Ghana, Chile, Vietnam, (etc. etc.) - I have to assume that the burden of demonstrating feasibility at this point falls to those who still call themselves socialists.
Socialism was put forward as The Liberatory Alternative to capitalism during an historical period between the mid-19th century and the late 20th century. I believe socialism failed and we have entered a post-socialist period based on an entirely new paradigm of human liberation, one that opens up the possibility that capitalism and socialism are not the only two choices (this is the theme of the current issue of Green Horizon Quarterly).
If neither the governments nor capitalists can run the economy democratically, in a socially and ecologically responsible manner, who or what can? Within what socio-economic context can bureaucracy, unaccountability, and irresponsibility be avoided? I think the answer is: within a communitarian context.
What I call communitarianism Ted Trainer (University of New South Wales, Australia) calls The Simpler Way: “The top priority is to develop small-scale local economies which enable people to provide for themselves most of the things they need, using local resources and labour. This frees a country from having to export fiercely in order to have the money to import what it needs. Above all it enables a country to take control of its own fate.”
I would add that a small-scale local economy is the only context which enables true participatory democracy - thus the validity of the Green movement’s key value: Community-Based Economics.
Below is a short article by Ted Trainer on this theme. For a more detailed critical account, see “Our Economic System: Why It Must Be Scrapped,” which includes ideas on the form that a satisfactory economy must take:
http://www.arts.unsw.edu.au/tsw/
At that Web site, TSW = The Simpler Way: analyses of global problems (environment, limits to growth, Third World ...) and sustainable alternatives (… simpler lifestyles, self-sufficient and cooperative communities, a new economy). Organised by Ted Trainer.
SW
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THE ECONOMY - A CRITICAL SUMMARY
by Ted Trainer
What should be the purpose of an economy?
Surely we would agree that the purpose of an economy should be to organise production, distribution and development, in order to provide people with the things they need for a satisfactory quality of life - with a minimum of work, resource use, waste, environmental impact, stress, etc. We would make sure that the benefits of the system were distributed satisfactorily. We probably would not say they should be distributed perfectly equally but we would probably want everyone to be able to work if they wanted to and were able, and to receive enough of the goods and services produced to have a satisfactory life.
In other words we would tackle the problem in a cooperative and collective way, with control in the hands of society as a whole, so that we could all discuss and decide on what seemed to be the best arrangements. (Of course we might decide that it was best to have many things produced by private firms and distributed via markets.)
But the economic system we have is nothing like this. What we do is:
a) allow a few very rich people to own almost all of the productive capacity in our society, the factories and farms and corporations. (Most of the world’s corporations are now owned by about 2% of the world’s people.),
b) allow the owners of the productive capacity to decide what is to be produced simply in terms of what will maximise their profits. We do not say “What do we need, what should be produced ... so let us organise our productive capacity to produce it.” There is a vast difference between organising production to meet needs and organising it to make profits. When you let profit determine what is produced many needs remain ignored, especially the most urgent needs which are experienced by the poorest people. This is because the best profits are never made by producing what poor people need (or what the environment needs, or what is necessary for social cohesion.) You make the best profits producing what middle and high income earners want and are willing to pay for.
The market.
In other words, we have an economy which allows the market to be the major determinant of what is produced, and who gets it. People are free to decide whether to produce or buy, and at what prices. This is claimed to be the most efficient way; the market is supposed to make the best economic allocations.
But the market actually makes the most appallingly bad allocations and investment decisions!! The market does some things well and in a satisfactory economy there could be a large role for it. But if it is the major determinant it will never allocate a fair share of scarce resources to those in most need, it will never protect the environment, and it will never do what is best for social cohesion.
In markets things go to those who can pay most for them. As a result the rich get most of the valuable resources and goods. For example one third of the world’s grain production is fed to animals in rich countries every year, while 1200 million people are hungry. Why? Simply because that is the most profitable thing to do with the grain.
Even more importantly, the development that results from market forces is inappropriate; investment will not go into what is most needed by poor majorities, or by the environment. It is much more profitable to develop and produce to meet the demand of richer people in rich countries.
These fundamental faults cannot be overcome without a great deal of regulation. A sensible economy would have to be under social control; i.e., the society as a whole would have to be able to decide how production and distribution and development were to be carried out.
The best way to do this is, of course, [a major issue of our times]. Few of us would now want it done by a big centralised state. However it could be done in ways that were quite democratic and participatory. Such an economy might have a large role for private firms and for markets, so long as these were carefully regulated.
The existence of many distressing problems is directly due to the fact that we allow the economy to be determined by what those who own capital want. For example, unemployment and poverty could be easily eliminated if society was in a position to allocate the necessary work among all who want work, or to give everyone a basic minimum income. But in our current economy whether or not people get work depends on whether or not it suits corporations to employ them.
Most important is the way this economy enables and legitimises the strong taking things from the weak. Richer people take scarce resources poor people need - including resources they once had, such as land and forests - simply by being able to pay more for them. Corporations can take the sales or markets small firms had, just because they can produce more cheaply and therefore whole industries and regions can be devastated when some foreign corporation comes in and undercuts their production costs.
We have an economy that enables the richest and most powerful to do what they want, rather than one which ensures that all can work and produce and earn a reasonable living.
Growth.
To conventional economists growth is unquestionably good and it is the supreme goal. There is never enough producing, selling, investing, trading and consuming going on! Their supreme goal is to keep the GDP growing forever! But continual economic growth is absurd. We are depleting world resources and destroying the environment because we are producing far too much already. A sustainable economy must be a zero growth economy, in which per capita levels of resource use must be far lower than they are in rich countries today.
Growth is crucial for a capitalist economy. Those with capital want to invest it to maxismise their profits. At the end of the year they want to have more capital than at the start, and then they want to invest all this in order to make more. This can’t happen unless there is constant increase in the amount of production going on. Capitalism’s biggest problem is that there will be insufficient investment outlets for all the capital that is constantly accumulating. This is the major force pushing for globalisation; i.e., the breaking down of all the protective and regulatory barriers that previously kept corporations out of many fields.
“Trickle down.”
The assumption is that if there is growth then the increased wealth will in time “trickle down” to enrich all. The best way to solve problems like poverty and unemployment is claimed to be simply to encourage more economic activity, as distinct from taking deliberate action to redistribute wealth and jobs.
However there is usually very little trickle down, and often just the reverse. This is most obvious in the Third World where there is often rapid growth and accumulation of wealth, but the poorest one third of the world’s people are actually getting poorer.
“Trickle down” is an extremely inefficient way of meetings needs. We urgently need more cheap housing and more hospitals, but our economy allows those with capital to devote it to whatever will maximise their profits.
Inequality.
Inequality is extreme and becoming worse. One-fifth of the world’s people are getting 86% of income while the poorest one-fifth are getting only 1.3% of it. About 500 individuals have as much wealth as the annual income of the other 6+ billion people on earth.
This economy causes extreme inequality. It does not need all people or regions, so many are dumped into squalor. For example, foreign investors invest very little in Africa. Modern agribusiness does not need country towns. This economy focuses resources and opportunities and sales on those with more money to spend or more valuable things to sell, i.e., it attends mostly to the rich, and further enriches them.
Globalisation.
Conventional economists are happy to see the emergence of a unified global economy and the passing of the era in which national economies were largely independent and in control of their own affairs. Now the fate of any country or town depends on whether it can survive in competition with all others in the world, finding something it can export more cheaply than any other. Because the supreme and sacred principle is that there must be no interference with the freedom of trade, it is increasingly difficult to block the import of problematic goods. The few most powerful corporations can come in and take over a country’s firms, markets and resources, and a country is not able to organise its own productive capacity to meet its people’s needs. Corporations are free to put that capacity into producing for the global market.
Alternative economists see the top priority as developing small scale local economies which enable people to provide for themselves most of the things they need, using local resources and labour. This frees a country from having to export fiercely in order to have the money to import everything it needs. Above all it enables a country to take control over its own fate.
Labour.
Conventional economists treat labour as just another commodity or factor of production, that can be used or ignored in order to maximise profits. But labour should not be treated as just another input into production. “Labour” is people. It is alright to leave a brick idle or to scrap it. It is not alright to leave a person unemployed and without a reasonable income. In the present economy, whether or not people have jobs is determined by whether the few with capital want more labour in their factories. It is wrong to let profit maximisation determine whether people are unemployed.
Unemployment is avoidable, unnecessary and morally intolerable. We could easily develop an economy in which it did not occur. If only a limited amount of work is necessary to produce simple but comfortable lifestyles then we should just share that work between all who need work.
In the current economy there is constant effort to create jobs, and all must constantly strive to find work to do. This is ridiculous; there is already far more work and producing taking place than is desirable. We should be trying to move to an economy in which we dramatically cut back on production and work.
Putting economics in its place.
In the present society economics is supremely important; the overriding concern is increasing production and consumption. In a good society these would not be very important issues. We would arrange to supply what all need for a decent life with a minimum of work and production, and then give most attention to much more important things, like cultural activities, life-long learning, recreation, solving social problems etc. Economic criteria would take second place to moral, social and ecological considerations. Often we would not do what was most economically efficient or profitable - because it is much more important to do what is good for people and the environment.
“There is no alternative.”
It is widely assumed that there is no satisfactory alternative to a capitalist economy. The only alternative most people can think of is big-state, centralised socialism or communism. But socialism as we have known it has [also, like capitalism, prioritized growth, production, and consumption]. The Simpler Way is for a new economy that is mostly made up of small, localised, largely self-sufficient, cooperative economies - in which the market is relatively insignificant.
Economic Theory.
Conventional economic theory is extremely narrow, warped and misleading. It is not about economics-in- general (for instance it only deals with things that have a monetary value, so it does not take into account housework or mutual assistance, and it cannot be applied to aboriginal societies). It is basically only about a capitalist economy, and it provides powerful ideological support for such an economy. It gets people to take for granted an economy in which capital is owned by a few, who produce not what is needed but only what will make most profit, corporations are given great freedom to do what they want while devastating the lives of billions of people and the environment, and in which the top priority is endlessly increasing sales when this is totally incompatible with sustainability.
Current economic theory rationalises and legitimises a system that is massively unjust, that causes tens of thousands of avoidable deaths every day, that is destroying social structure and cohesion, and is lowering the quality of life in even the richest societies, while rapidly increasing the wealth of the obscenely rich. Conventional theory, and the economics profession, help to get all this accepted without protest - by insisting that the free market works best for all, by never questioning private ownership of capital, by asserting growth to be the supreme value, etc.