Typology of Approaches

Compiled and commented upon by Jean-Daniel Cusin:

Parecon: Participatory Economics

From Wikipedia:

Participatory economics, often abbreviated parecon, is an economic system based on participatory decision making as the primary economic mechanism for the allocation of the factors of production and guidance of production in a given society. Participatory decision-making involves the participation of all persons in decision-making on issues in proportion to the impact such decisions have on their lives. Participatory economics is a form of decentralized economic planning and socialism involving the common ownership of the means of production. The participatory economic system is proposed as an alternative to contemporary capitalism, as well as an alternative to central planning. This economic model is primarily associated with the proposals put forth by the political theorist Michael Albert and economist Robin Hahnel, who describe participatory economics as an anarchistic economic vision.

The underlying values that parecon seeks to implement are equity, solidarity, diversity, workers' self-management and efficiency (defined as accomplishing goals without wasting valued assets). The institutions of parecon include workers' and consumers' councils utilizing self-managerial methods for making decisions,balanced job complexes, remuneration based on individual effort, and participatory planning.

[...]

Albert and Hahnel argue that it is inequitable and ineffective to compensate people on the basis of their birth or heredity. Therefore, the primary principle of participatory economics is to reward for effort and sacrifice.[3] For example, mining work — which is dangerous and uncomfortable — would be more highly paid than office work for the same amount of time, thus allowing the miner to work fewer hours for the same pay, and the burden of highly dangerous and strenuous jobs to be shared among the populace.

Additionally, participatory economics would provide exemptions from the compensation for effort principle.[3] People with disabilities who are unable to work, children, the elderly, the infirm and workers who are legitimately in transitional circumstances, can be remunerated according to need. However, every able adult has the obligation to perform some socially useful work as a requirement for receiving reward, albeit in the context of a society providing free health care, education, skills training, and the freedom to choose between various democratically structured workplaces with jobs balanced for desirability and empowerment. The starting point for the income of all workers in participatory economics is an equal share of the social product. From this point, incomes for personal expenditures and consumption rights for public goods can be expected to diverge by small degrees reflecting the choices that individual workers make in striking a balance between work and leisure time, and reflecting the level of danger and strenuousness of a job as assigned by their immediate peers.

New Socialism

As described by Nick Dyer-Witheford in Red Plenty Platforms:

...its twenty-first century super-computer planning follows to the letter the logic of the late nineteenth century Critique of the Gotha Program (Marx, 1970), which famously suggests that at the first, ‘lower’ stage to communism, before conditions of abundance allow ‘to each according to his needs’, remuneration will be determined by the hours of socially necessary labour required to produce goods and services. In the capitalist workplace, workers are paid for the reproduction of the capacity to labour, rather than for the labour actually extracted from them; it is this that enables the capitalist to secure surplus value.

The elimination of this state of affairs, Cockshott and Cottrell contend, requires nothing less than the abolition of money—that is, the elimination of the fungible general medium of exchange that, through a series of metamorphoses of money in and out of the commodity form, creates the self-expanding value that is capital. In their new Socialism, work would be remunerated in labour certificates; an hour’s work could be exchanged for goods taking, on a socially average basis, an equivalent time to produce. The certificates would be extinguished in this exchange; they would not circulate, and could not be used for speculation. Because workers would be paid the full social value of their labour, there would be no owner profits, and no capitalists to direct resource allocation. Workers would, however, be taxed to establish a pool of labour-time resources available for social investments made by planning boards whose mandate would be set by democratic decisions on overall social goals.

[...]

Cockshott and Cottrell’s answer [to the Calculation Problem] involves new tools, both conceptual and technical. The theoretical advances are drawn from branches of computing science that deal with abbreviating the number of discrete steps needed to complete a calculation. Such analysis, they suggest, shows their opponents’ objections are based on ‘pathologically inefficient’ methods (Cockshott, in Shalizi, 2012).

The input-output structure of the economy is, they point out, ‘sparse’—that is to say, only a small fraction of the goods are directly used to produce any other good. Not everything is an input for everything else: yogurt is not used to produce steel. The majority of the equations invoked to suggest insuperable complexity are therefore gratuitous. An algorithm can be designed to short-cut through input-output tables, ignoring blank entries, iteratively repeating the process until it arrives at a result of an acceptable order of accuracy.

Shalizi takes up Cockshott’s proposals in another article responding to the criticisms of the first article cited above:

For Cockshott's algorithm, or any other linear solver, to be of real relevance here, we need to presume that

• we have settled on exactly how much of every good (and service) we want the economy to produce, including indexing by time and space;

• we have, for each good in the economy, exactly one way to produce every good in the economy, or we have, somehow, settled on one such way per good;

• every good in the economy is produced by combining inputs in fixed, known proportions, with no possibility of substitutions, alternative methods, increasing (or decreasing) returns, etc.;

• we do not need to check whether we actually have sufficient resources to achieve the desired level of output with the given technology

However, it would be easy enough (linear time) to check, at the end, whether the required resources exceed available stocks, so the last point is not all that bad.

What is bad is completely assuming away having to chose what to make and having to chose how to make it. That’s all interesting, but while I may care technically or in the long run, I don’t care in this head design. I am not after optimums. And I am not trying to compute the whole economy at once. And I do assume that the analysis has roughly figured out the goods and services to produce, the ongoing signals of need will refine them and add new ones, and the value systems for those goods and services will figure out the details.

I do like Cockshott’s wage proposals, and he also had another great idea: students should be paid for all educational work. But those are both utopian. More on utopian ideas below.

Red Plenty Platforms

Nick Dyer-Witheford surveys all of the proposals mentioned above, plus his own (at the end of these excerpts),

To bring the New Socialists up to date we should instead refer to Fredric Jameson’s iconoclastic vision of WalMart as ‘the shape of a Utopian future looming through the mist’ (2009: 423). His point is that, if one for a moment ignores the gross exploitation of workers and suppliers, Wal-Mart is an entity whose colossal organizational powers model the planned processes necessary to raise global standards of living. And as Jameson recognizes, and other authors document in detail (Lichtenstein, 2006), this power rests on computers, networks and information. By the mid 2000s Wal-Mart’s data-centers were actively tracking over 680 million distinct products per week and over 20-million customer transactions per day, facilitated by a computer system second in capacity only to that of the Pentagon.

[...]

Thus the trajectory of both information processing speeds and data gathering capacities points to the suppression of the ‘socialist calculation problem.’ However, to speak of planning in such panoptic contexts is to inevitably invoke fears of omniscient state control. The New Socialists come from a vanguard Marxist-Leninist lineage, with a self-avowed ‘Jacobin’ centralist perspective (Cockshott, Cottrell, & Dieterich, 2011). To consider how cybernetic planning might be developed in more transparent and participatory modes, we need to look to different communist traditions.

[...]

Historically, the anti-statist tendency in Marxism has been largely carried in a very different ‘worker council’ tradition, that, against the powers of party and state has insisted on the role of workplace assemblies as the loci of decision-making, organization and power. In an essay antediluvian by digital standards, ‘Workers' Councils and the Economics of a Self-Managed Society,’ written in 1957 but republished in 1972, immediately after the Soviet crushing of Hungary’s Workers Councils, Cornelius Castoriadis noted the frequent failure of this tradition to address the economic problems of a ‘totally self-managed society.’ The question, he wrote, had to be situated ‘firmly in the era of the computer, of the knowledge explosion, of wireless and television, of input-output matrices abandoning ‘socialist or anarchist utopias of earlier years’ because ‘the technological infrastructures ... are so immeasurably different as to make comparisons rather meaningless’ (Castoriadis, 1972: np).

Like the planners of Red Plenty, Castoriadis imagines an economic plan determined with input-output tables and optimizing equations governing overall resource allocation (e.g. the balance between investment and consumption), but with implementation in the hands of local councils. His crucial point, however, is that there should be several plans available for collective selection. This would be the mission of ‘the plan factory’, a ‘highly mechanized and automated specific enterprise’, using ‘a computer’ whose ‘memory’ would ‘store the technical coefficients and the initial productive capacity of each sector’ (Castoriadis, 1972: np). This central workshop would be supported by others studying the regional implications of specific plans, technological innovations, and algorithmic improvements. The ‘plan factory’ would not determine what social targets should be adopted; merely generate options, assess consequences, and, after a plan has been democratically chosen, up-date and revise it as necessary. Castoriadis would agree with Raymond Williams’s (1983) later observation that there is nothing intrinsically authoritarian about planning, providing there is always more than one plan.

This early concept of cybernetic self-management is a precursor of a more recent envisioning of post-capitalism, Michael Albert and Robin Hahnel’s (1991) ‘Participatory Economics’ or ‘Parecon’. This too emerges from a ‘workers council’ tradition, though from an anarchist, rather than Marxist line of thought. Their work is famous for its model of ‘decentralized participatory planning’ (Albert, 2003: 122), alternative to both market mechanisms and central planning. Councils are, again, the basic societal units for democratic decision, but in Parecon these include not just worker but consumer councils, too. Resource allocation is determined by these organizations’ bids for different levels of production and consumption, which over a series of rounds of negotiation are progressively reconciled by Iteration Facilitation Boards. At successive stages of the planning process, worker and consumer councils are encouraged by the IFBs to revise their proposals in knowledge of each other’s inputs, until enough convergence is produced to put a few possible plans to a vote.

[...]

Yet perhaps the idea of everyone watching mobile screens lest they miss, not a Facebook poke, but voting the seventh iteration of the participatory plan, duplicates unattractive features of everyday life in high-tech capitalism. So we might speculate further, and suggest that what decentralized collective planning really needs is not just council media but communist agents: communist software agents.

Software agents are complex programmed entities capable of acting ‘with a certain degree of autonomy... on behalf of a user (or another program)’ (Wikipedia, 2013b: np). Such agents manifest ‘goal- direction, selection, prioritization and initiation of tasks’; they can activate themselves, assess and react to context, exhibit aspects of artificial intelligence, such as learning, and can communicate and cooperate with other agents (Wikipedia, 2013b: np). [...] the arena in which such agents truly excel is in the financial sector, where high frequency trading is entirely dependent on software ‘bots’ capable of responding to arbitrage possibilities in milliseconds.

One can’t help but ask, however, what if software agents could manifest a different politics? Noting that Multi-Agent System models can be thought of as a means to answer problems of resource allocation, Don Greenwood (2007: 8) has suggested they could be geared toward solving the ‘socialist calculation problem’. As planning tools, Multi-Agent Systems, he notes, have the advantage over real markets that ‘the goals and constraints faced by agents can be pre-specified by the designer of the model’ (Greenwood, 2007: 9). It is possible to design agents with macro-level objectives that involve more than just the maximization of individual self-interest; two ‘welfare’ principles that economists have experimented with incorporating are equality and environmental protection sustainability.

[...]

Within capital, automation threatens workers with unemployment or production speed-up. If, however, there were no dominant structural tendency for increases in productivity to lead to unemployment or greater output without reduction in labour time, automation could systematically yield to less time spent in formal workplaces. In a communist framework that protected access to the use value of goods and services, robotization creates the prospect of a passage from the realm of necessity to freedom. It reintroduces the goal – closed down both within the Stakhanovite Soviet experiment and in the wage-raising trades unionism of the West – of liberating time from work, with all this allows both in terms of human self- development and communal engagement.

Juliet Schor’s (1991) estimate, that if American workers had taken gains won from productivity increases since the 1950s, not in wages but in time off, they would by 2000 have been working a twenty hour week.[u][v] [Added note: that seems like too many hours. Paul Goodman in 1950 estimated one day a week.] It indicates the scale of possible change. Proposals for a ‘basic income’ have recently figured in left politics. There are certainly criticisms to be made of these insofar as they are advanced as a reformist strategy, with the risk of becoming merely a rationalized welfare provision supporting neoliberal precarity. But it would be hard to envision a meaningful communist future that did not institute such measures to acknowledge the reductions in socially necessary labour time made possible by advances in science and technology, destroying Hayek’s calculation problem by progressively subtracting from it the capitalist ur-commodity, labour power.

[...]

An abundant communist society of high automation, free software, and in-home replicators might, however, as Fraise (2011) suggests, need planning more than ever – not to overcome scarcity but to address the problems of plenty, which perversely today threaten shortages of the very conditions for life itself. Global climate change and a host of interlinked ecological problems challenge all the positions we have discussed to this point. Bio-crisis brings planning back on stage, or indeed calculation – but calculation according to metrics measuring limits, thresholds and gradients of the survival of species, human and otherwise. Discussing the imperatives for such ecosocialist planning, Michael Lowy (2009) points out how this would require a far more comprehensive social steering than mere ‘workers control’, or even the negotiated reconciliation of worker and consumer interests suggested by schemes such as Parecon. Rather, it implies a far-reaching remaking of the economic systems, including the discontinuation of certain industries, such as industrial fishing and destructive logging, the reshaping of transportation methods, ‘a revolution in the energy-system’ and the drive for a ‘solar communism’ (Lowy, 2009: np).

[...]

By revealing the contingency of conditions for species survival, and the possibility for their anthropogenic change, such ‘knowledge infrastructures’ of people, artifacts, and institutions (Edwards, 2010: 17) – not just for climate measurement, but also for the monitoring of ocean acidification, deforestation, species loss, fresh water availability – reveal the blind spot of Hayek’s catallaxy in which the very grounds for human existence figure as an arbitrary ‘externality’. So-called ‘green capital’ attempts to subordinate such bio-data to price signals. It is easy to point to the fallacy of pricing non-linear and catastrophic events: what is the proper tag for the last tiger, or the carbon emission that triggers uncontrollable methane release? But bio-data and bio-simulations also now have to be included in any concept of communist collective planning. Insofar as that project aims at a realm of freedom that escapes the necessity of toil, the common goods it creates will have to be generated with cleaner energy, and the free knowledge it circulates have metabolic regulation as a priority. Issues of the proper remuneration of labor time require integration into ecological calculations.

[...]

The Soviet experience, of which the cyberneticians featured in Red Plenty were part, was only a narrow, historically specific and tragic instantiation of this capability, whose authoritarianism occludes the most crucial point in the Marxist concept of planning, namely that it is intended as a means of communal election of which, of a variety of trajectories, collective human ‘species-becoming’ might follow (Dyer-Witheford, 2004). A new cybernetic communism, itself one of these options, would, we have seen, involve some of the following elements: use of the most advanced super-computing to algorithmically calculate labour time and resource requirements, at global, regional and local levels, of multiple possible paths of human development; selection from these paths by layered democratic discussion conducted across assemblies that include socialized digital networks and swarms of software agents; light-speed updating and constant revision of the selected plans by streams of big data from production and consumption sources; the passage of increasing numbers of goods and services into the realm of the free or of direct production as use values once automation, copy-left, peer-to-peer commons and other forms of micro-replication take hold; the informing of the entire process by parameters set from the simulations, sensors and satellite systems measuring and monitoring the species metabolic interchange with the planetary environment.