Wednesday, June 25, 2008
Tuesday, June 24, 2008
Taking lessons from the masters
The BBC gets all indignant about the latest , and very predictable news from Afghanistan. The Taleban made an estimated $100m (£50m) in 2007 from Afghan farmers growing poppy for the opium trade, the United Nations says. Antonio Maria Costa, head of the UN's Office on Drugs and Crime (UNODC), said the money was raised by a 10% tax on farmers in Taleban-controlled areas. The UN estimates last year's poppy harvest was worth $1bn (£500m).
The same BBC website carries an interview with the Indian writer Amitav Ghosh about his new book Sea of Poppies .
"...Under the British Raj, an enormous amount of opium was being exported out of India until the 1920s... India was the largest opium exporter for centuries. ..I had no idea that opium was essentially the commodity which financed the British Raj in India. Opium steadily accounted for about 17-20% of Indian revenues..."
What did the Indians gain out of it ? Before the British came, India was one of the world's great economies. All the empirical facts show you that British rule was a disaster for India. Before the British came 25% of the world trade originated in India. By the time they left it was less than 1%.
Sunday, June 22, 2008
Indian reads
No way am I adopting Gandhi as a socialist because he wasn't, preferring to believe that he could use moral force to achieve a more equitable society where capitalists would become trustees over the labourer and a levelling of incomes. However, i visited the museum in his honour at Madurai and bought a book of selected quotes. I have come across a few pertinent quotations that are worth posting.
"According to me, the economic constitution of India and for that matter of that of the world, should be such that no-one under it should suffer from want of food and clothing. In other words everybody should be able to get sufficient work to enable him to make the two ends meet. And this ideal can be universally realised only if the means of production of the elementary necessaries of life remain in the control of the masses. These should be freely available to all as God's air and water are or ought to be; they should not be made a vehicle of traffic for the exploitation of others. Their monopolisation by any country, nation or group of persons would be unjust. The neglect of this simple principle is the cause of the destitution that we witness today not only in this unhappy land but in other parts of the world too."
Elsewhere, Gandhi says:-
"The real implication of equal distribution is thateach man shall have the wherewithal to supply all his natural wants and no more. For example, if a man has a weak digestion and requires only a quarter of a pound of flour for his bread and another needs a pound, both should be in a position to satisfy their wants. To bring this ideal into being the entire social order has got to be re-constructed."
And again he said:-
" The elephant needs a thousand times more food than the ant, but that is no indication of inequality. So the real meaning of economic equality was:
" To each according to his need".
That was the definition of Marx."
I have also been reading a more contemporary book. Riot after Riot by M.J. Akbar , his reports on caste and communal violence in India.
Some things are worth while posting from that.
From the introduction by Khushwant Singh:-
"There was reason to hope that we had seen the last communal strife and that India would indeed fulfil Gandhi's dream ...But that was not to be. Our hopes have turned to ashes. Hindu-Muslim confrontations on religious festivals have begun to occur with sickening regularity in riot-prone arts of the country where the two communities co-exist. From being Hindu versus Muslim, they have become Hindu versus Christian, Hindu versus Sikh, upper-caste Hindu versus lower caste Hindu, Christain versus Buddhist, hill tribal versus plains tribal. In the massacre at Nellie in Assam, it was just about everyone against his neighbour. It has become clearer that we are too many with not enough land or jobs available for all of us. The root cause of spreading endemic violence is economic: religious linguistic and ethnic differences provide the excuse and motivation to indulge in it..."
Akbar in The Spiders of Orissa writes:-
"...To create a good slave you must first kill his pride, his self-respect, his notion of himself as an ordinary equal human being. The slave's body is needed - the man's for labour, the woman's for labour and abuse; but to control the body the inner spark which ignites anger must be crushed. There are many weapons in the spiders arsenal, both psychological and physical, but the chief one is dramatically simple: hunger. When a generation or two dies of the ultimate denial, delirious for a handful of rice, while a chorus of spiders fattens indifferently in the background, physical and mental slavery becomes an easy option to the dying. The young woman at your feet is not prostrate through love or devotion; she is there because over many lifetimes she has learnt that the degradation of the spirit is the only guarantee she has against the degradation of the body, that food and safety are not her right but a gift which a superior might grant if she behaves. The man, his taut, dark body glistening with youth which will fast wither, is allowed the hint of a sullen look, but no more. Oppress by destitution. Keep a people on the permanent knife-edge of hunger: normalcy should never mean more than one meal of rice and dal a day...
...The real trick is to destroy the confidence of a people: make them believe the caractures you have created about them. Less than 500 years ago, these tribals of Orissa and Bastar and Andhra ruled over a brilliant empire; today they have been turned into parodies of a cruel fiction. The tribal man is a mahua-swigging drunk. The woman is an easy lay. The strength of the hoax lies, of course, in the fact that it is constructed on a malicious distortion of reality to give it a facade of believability. The tribal does like a drink and has none of the hypocritical duplicity of the middle class towards liquor. That does not maker him a drunkard. The woman is beautiful; she does not wear a blouse and no-one in her village looks twice at her exposed breasts; leering is the prerogative of the starved visitor. To equate this with prostitution is the task of the pervert. What has made one tribal an emaciated drunkard and another a prostitute in Raipur or Calcutta is hunger; gnawing, tearing, shattering hunger. And the last stage of hunger: despair. There is no hope left of escaping from the web, so lie somnolescent at the centre, praying that destiny grants you a few extra days before the spider inevitably consumes you ..."
Monday, June 16, 2008
Pareconfusion
In "Ideology over Reality" Michael Albert appears quite willing to engage in further debate with the WSM therefore i will endeavour to present our practical alternative , mostly cutting and pasting from previous exchanges and various articles .
Having laid down 5 rules to engaging in constructive discussion and accusing the editors of the Socialist Standard of failing to uphold this standard of intellectual honesty , yet MA in his article betrays that he has made little or no attempt whatsoever , not even by the briefest of Wikipedia searches , to seek out an understanding of the views of the WSM , or otherwise he woulds not have mistakenly associated the WSM with Trotsky " as in this excerpt , "...(The editors want to reject the Soviet system I hope for good reasons rather than only because Trotsky did, in the end.)...." and again here "...And all this is so, note,just by decree, by definition, by the authority of humpty dumpty, in my view, and I guess Trotsky, or whoever, in the editors' view..." . MA is unaware that the WSM was perhaps the earliest critics of Bolshevism from 1918 , very much alone and against the popular feeling within the socialist movement when they questioned the validity of the Bolshevik claims . MA , nevertheless , unintentionally reveals that his attitude is that all criticism of Russia begins and ends with Trotsky or Trotskyists , (which explains the obssession with bureaucracy of the deformed workers state or bureaucratic collective state or whatever neo- or ex--Trotskyist of Russia view MA adheres to .)
He failed to practice what he preached , to seek an understanding of his opponents position. His 5 precepts of debate are more a matter of "Do what i say . Not what i do ." to score debating points
We employ "obscurantist jargon" according to MA - and of course Parecon doesn't , but forgive me , but a whole glossary of Parecon terms meanings is required and words redefined to mean what they aren't such as remuneration doesn't really mean wages . However , as someone who can judge that Joan Robinson "as one of the more knowledgeable people in marxist economics in the world" he fails to recognise Marxist terminology and concepts that he so readily dismisses as obscurant .
But i do not consider that a necessary failing because Marx was required to de-mystify existing language by creating or re-defining those new terms to reach the kernel of the social problems , just as Parecon writers have also been required to do to elaborate its ideas .
Marx is famous for his anti-philosophy quotation "philosphers have only interpret the world , the point is to change it " to paraphrase , yet amazingly enough what is often over looked is the sub-title of Capital - " A Contribution to a critique of political economy " . Marx desired the abolition of economics , the same objective shared by the WSM who wish to challenge the assumptions and preconceived ideas of those economists that endeavour to re-create social relationships in the image of the existing society . Marx was not writing as a simple economist but was putting forward a “critique of political economy” , his main argument being that, whereas writers like Adam Smith and Ricardo regarded economic categories such as capital, wages, value, price, money, etc as eternal, natural features of human social existence, these were in fact categories of capitalism which would disappear when it did.
Conventional academic economics declare that the true state of the world is scarcity - limited supply - versus- boundless demand , denying the potential for a state of abundance can exist.Our wants are essentially “infinite” and the resources to meet them, limited , claim the economists . However in the real world , abundance is not a situation where an infinite amount of every good could be produced . Similarly, scarcity is not the situation which exists in the absence of this impossible total or sheer abundance.( It is these economists who really are the Humpty Dumpties when it comes to re-defining words , not ourselves ) . Abundance is a situation where productive resources are sufficient to produce enough wealth to satisfy human needs, while scarcity is a situation where productive resources are insufficient for this purpose. Admitting this would mean the end, not only of the economy as a system of allocating scarce resources but also of goods having an economic value and price; goods would simply become useful things produced for human beings to take and use, while economics as the study of the most rational way to employ scarce resources would give way to the study of how best to use abundant resources to produce free goods in the amounts required to satisfy human needs .This is the purpose of the WSM , to speed the day towards free access and the end of economics . That is what could be described as a revolutionary concept and not the idealised buying and selling world of commerce without exploitation that Parecon wishes to establish.
The real discussion is how to provide for the needs of all using the ingenuity of the human race . That is the big X which both MA and WSM share and wish to address . So lets use the napkins as recommended by MA to outline the type of new society we desire without any reference to Marx's Labour Theory of Value . Just some application of common sense to solve a pressing problem . Let us compare one with another . Participatory Economics V Free Access Socialism .
"When I tell them that this means they have not only jettisoned prices, income, etc., but they have done away with all possibility of sensible allocation because they have no way to decide between options based on valuations ... ", they simply ignore it. When I tell them they have also done away with all possibility of attaining just distribution because, again, there is no way to say to a consumer, or for a consumer to even know that some amount is more (or less) than he or she should have, or to say to a worker, or for a worker to even know, some level of work is more (or less) than you should be doing - the editors think they don't need to answer....they don't offer a serious set of institutions without those features and show their viability - though perhaps somewhere else they do and I am just unaware of it - though I very much doubt it. "
And in case we never understood the first time , MA repeats it
"...And yes, people have incomes, or said differently, have budgets, which limit how much ofthe social product they are entitled to. And yes, allocation decisions about what to produce using resources and labor, etc. and about who winds up producing it or getting it, use valuations and are impacted by budgets. Not only does all this happen in a parecon, but more, I claim if it didn't the system would be utterly incapable of functioning intelligently, or even at all, much less functioning equitably and with self management. That ought to be trivially apparent. You can't make sound judgements about producing one item instead of some other, or vice versa, without knowing how much cost and benefit the item and its production involve..."
And MA KNOWS that only prices and money can be used to rationally organise society because the professors text-books say sot, thus it must be true and a law as natural as the Law of Gravity . Another example of MA not practicing what he preaches .
MA reveals this slavery to orthodox capitalist economists when he employs what is called the Economic Calculation Argument (developed by Von Mises , even if MA declines to quote chapter and verse of Mises , he nevertheless , accepts it without questioning the actual requirement of a pricing mechanism for the well-being of society . It is automatically taken as fact , an economic law ).
And YES he is unaware of our rebuttals and our own analysis of future society because he did not follow his own admonishments and recommendations for healthy exchange of views and research his opponents webpages .
Let us begin with prices and how practical allocation of resources do not require the intervention of a pricing mechanism and how resources can be rationally allocated in a moneyless society .
A monetary economy gives rise to the illusion that the “cost” of producing something is merely financial . Money is the universal unit of measurement, the “general equivalent” that allows everything to be compared with everything else under all circumstances—but only in terms of their labour-time cost or the total time needed on average to produce them from start to finish.Such non-monetary calculation of course already happens, on the technical level, under capitalism. Once the choice of productive method has been made (according to expected profitability as revealed by monetary calculation) then the real calculations in kind of what is needed to produce a specific good commence so much raw materials, so much energy, so much labour.In socialism it is not the case that the choice of productive method will become a technical choice that can be left to engineers (perhaps those of the co-ordinator class that MA fears ) , as is sometimes misunderstood by critics, but that this choice too will be made in real terms, in terms of the real advantages and disadvantages of alternative methods and in terms of, on the one hand, the utility of some good or some project in a particular circumstance at a particular time and, on the other hand, of the real “costs” in the same circumstances and at the same time of the required materials, energy and productive effort.
By the replacement of exchange economy by common ownership basically what would happen is that wealth would cease to take the form of exchange value, so that all the expressions of this social relationship peculiar to an exchange economy, such as money and prices, would automatically disappear. In other words, goods would cease to have an economic value and would become simply physical objects which human beings could use to satisfy some want or other. The disappearance of economic value would mean the end of economic calculation in the sense of calculation in units of value whether measured by money or directly in some unit of labour-time. It would mean that there was no longer any common unit of calculation for making decisions regarding the production of goods. This is MA contention , that without prices we can not allocate resources . The WSM counter this with the proposal that socialism, as a moneyless society in which use values would be produced from other use values, there would need no have a universal unit of account but could calculate exclusively in kind .The only calculations that would be necessary in socialism would be calculations in kind. On the one side would be recorded the resources (materials, energy, equipment, labour) used up in production and on the other side the amount of the good produced, together with any by-products. This, of course, is done under capitalism but it is doubled by an exchange value calculation: the exchange value of the resources used up is recorded as the cost of production while the exchange value of the output (after it has been realised on the market) is recorded as sales receipts. If the latter is greater than the former, then a profit has been made; if it is less, then a loss is recorded. Such profit-and-loss accounting has no place in socialism and would, once again, be quite meaningless.
Calculation in kind entails the counting or measurement of physical quantities of different kinds of factors of production. There is no general unit of accounting involved in this process such as money or labour hours or energy units. In fact, every conceivable kind of economic system has to rely on calculation in kind, including capitalism. Without it, the physical organisation of production (e.g. maintaining inventories) would be literally impossible. But where capitalism relies on monetary accounting as well as calculation in kind, socialism relies solely on the latter. This is one reason why socialism holds a decisive productive advantage over capitalism AND Parecon by eliminating the need to tie up vast quantities of resources and labour implicated in a system of monetary/pricing accounting.
MA tells us that without the guidance of prices socialism would sink into inefficiency . “Socialism” or “communism” has for the WSM meant a society without markets, money, wage labour or a state. All wealth would be produced on a strictly voluntary basis. Goods and services would be provided directly for self determined need and not for sale on a market; they would be made freely available for individuals to take without requiring these individuals to offer something in direct exchange. The sense of mutual obligations and the realisation of universal interdependency arising from this would profoundly colour people’s perceptions and influence their behaviour in such a society. We may thus characterise such a society as being built around a moral economy and a system of generalised reciprocity.
Lets get to the practicalities of Free Access Socialism .
The problem with a centrally-planned model of socialism was its inability to cope with change. It lacks any kind of feedback mechanism which allows for mutual adjustments between the different actors in such an economy. It is completely inflexible We witnessed in Russia how it was unable to determine prices by central planning. Prices were set , re-set , fixed then re-fixed , plans were made then re-appraised , re-defined , changed and dropped .
Socialism however is a decentralised or polycentric society that is self regulating , self adjusting and self correcting , from below and not from the top . It is not a command economy but a responsive one .
Stock or inventory control systems employing calculation in kind are absolutely indispensable to any kind of modern production system. While it is true that today they operate within a price environment that is not the same thing as saying they need such an environment in order to operate. Most students of Logistics will be able to explain how unnecessary dollars and cents are for its operation. The key to good stock management is the stock turnover rate – how rapidly stock is removed from the shelves – and the point at which it may need to be re-ordered. This will also be affected by considerations such as lead times – how long it takes for fresh stock to arrive – and the need to anticipate possible changes in demand. The Just- In- Time systems are another tried and trusted tool of warehousing and supply chains which can be utilised . And even so the existence of buffer stocks provides for a period of re-adjustment. We even have the existence of store "loyalty cards" that can be put to more creative and constructive non-commercial usage . Socialism does not necessary involve the creation of new layers of administrations but simply the transformation of them . There will be little need for the creation of Iteration Facilitation Boards to produce indicative prices
The “law of the minimum” was formulated by an agricultural chemist, Justus von Liebig in the 19th century. Liebig’s Law can be applied equally to the problem of resource allocation in any economy.For any given bundle of factors required to produce a given good, one of these will be the limiting factor. That is to say, the output of this good will be restricted by the availability of the factor in question constituting the limiting factor. All things being equal, it makes sense from an economic point of view to economise most on those things that are scarcest and to make greatest use of those things that are abundant. Factors lying in between these two poles can be treated accordingly in relative terms.
Actually to claim that all factors are scarce (because the use of any factor entails an opportunity cost) and, consequently, need to be economised is not a very sensible approach to adopt. Effective economisation of resources requires discrimination and selection; you cannot treat every factor equally – that is, as equally scarce – or, if you do, this will result in gross misallocation of resources and economic inefficiency.
In any economy there needs to be some way of prioritising production goals.How might these priorities be determined? We can apply Maslow’s “hierarchy of needs” as a guide to action. It would seem reasonable to suppose that needs that were most pressing and upon which the satisfaction of other needs are dependant would take priority over those other needs. We are talking here about our basic physiological needs for food, water, adequate sanitation and housing and so on. This would be reflected in the allocation of resources: high priority end goals would take precedence over low priority end goals where resources common to both are revealed (via the self regulating system of stock control) to be in short supply .
We can also speculate, that some kind of “points system” might be used with which to evaluate a range of different projects facing such a society . Again those more qualified can explain how cost-benefit analysis is not dependant upon dollars and cents calculations, as even now ecological concerns are required to be taken into consideration in planning . In fact each day we all individually use various methods of adding up pros and cons to determine actions . Naturally, under capitalism ( read Parecon) the balance sheet of the relevant benefits and costs advantages and disadvantages of a particular scheme or rival schemes is drawn up in money terms , but in socialism a points system for attributing relative importance to the various relevant considerations could be used instead. The points attributed to these considerations would be subjective, in the sense that this would depend on a deliberate social decision rather than on some objective standard. In the sense that one of the aims of socialism is precisely to rescue humankind from the capitalist fixation with production time/money, cost-benefit type analyses, as a means of taking into account other factors, could therefore be said to be more appropriate for use in socialism than under capitalism. Using points systems to attribute relative importance in this way would not be to recreate some universal unit of evaluation and calculation, but simply to employ a technique to facilitate decision-making in particular concrete cases. The advantages /disadvantages and even the points attributed to them can, and normally would, differ from case to case. So what we are talking about is not a new abstract universal unit of measurement to replace money and economic value but one technique among others for reaching rational decisions in a society where the criterion of rationality is human welfare.
Marx and the WSM has been generally reluctant about producing "recipes for the cook-shops of tomorrow" ( unlike the detailed and specific constructs of Parecon ) but a broad picture would be that production- for- use would operate in direct response to need . These would arise in local communities expressed as required quantities such as grammes , kilos , tonnes , litres , metres , cubic metres , etc , of various materials and quantities of goods . These would then be communicated as required elements of productive activity , as a technical sequence, to different scales of social production , according to necessity .Each particular part of production would be responding to the material requirements communicated to it through the connected ideas of social production . It would be self -regulating , because each element of production would be self-adjusting to the communication of these material requirements . Each part of of production would know its position . If requirements are low in relation to a build-up of stock , then this would an automatic indication to a production unit that its production should be reduced . If The register of needs and the communication of every necessary element of those needs to the structure of production would be clear and readily known . The supply of some needs will take place within the local community and in these cases production would not extent beyond this , as for example with local food production for local consumption .Other needs could be communicated as required things to the regional organisation of production. Local food production would require glass, but not every local community could have its own glass works . The requirements for glass could be communicated to a regional glass works . These would be definite quantities of required glass . The glass works has its own suppliers of materials , and the amounts they require for the production of 1 tonne of glass are known in definite quantities. The required quantities of these materials could be passed by the glass works to the regional suppliers of the materials for glass manufacture . This would be a sequence of communication of local needs to the regional organisation of production, and thus contained within a region .Local food production would also require tractors, and here the communication of required quantities of things could extend further to the world organisation of production . Regional manufacture could produce and assemble he component parts of tractors for distribution to local communities .These would be required in a definite number and , on the basis of this definite number of final products , the definite number of component parts for tractors would also be known . The regional production unit producing tractor would communicate these definite quantities to their own suppliers , and eventually this would extend to world production units extracting and processing the necessary materials .This would be the self-regulating system of production for need , operating on the basis of the communication of need as definite quantities of things throughout the structure of production . Each production unit would convert the requirements communicated to it into its own material requirements and pass these on to its suppliers . This would be the sequence by which every element of labour required for the production of a final product would be known .This system of self-regulating production for use is achieved through communications . Socialism would make full use of the means communications which have developed . These include not only transport such as roads , railways , shipping etc. They also include the existing system of electronic communications which provide for instant world-wide contact as well as facilities for storing and processing millions of pieces of information . Modern information technology could be used by socialism to integrate any required combination of different parts of its world structure of production . Simpler is Better.
Planning in socialism is essentially a question of industrial organisation, of organising productive units into a productive system functioning smoothly to supply the useful things which people had indicated they needed, both for their individual and for their collective consumption. What socialism would establish would be a rationalised network of planned links between users and suppliers; between final users and their immediate suppliers, between these latter and their suppliers, and so on down the line to those who extract the raw materials from nature. There is no point in drawing up in advance the sort of detailed blueprint of industrial organisation that the old IWW and the Syndicalists used to and what Parecon now does , but it is still reasonable to assume that productive activity would be divided into branches and that production in these branches would be organised by a delegate body. The responsibility of these industries would be to ensure the supply of a particular kind of product either, in the case of consumer goods, to distribution centres or, in the case of goods used to produce other goods, to productive units or other industries.
Since the needs of consumers are always needs for a specific product at a specific time in a specific locality, we will assume that socialist society would leave the initial assessment of likely needs to a delegate body under the control of the local community (although, other arrangements are possible if that were what the members of socialist society wanted). In a stable society such as socialism, needs would change relatively slowly. Hence it is reasonable to surmise that an efficient system of stock control, recording what individuals actually chose to take under conditions of free access from local distribution centres over a given period, would enable the local distribution committee to estimate what the need for food, drink, clothes and household goods would be over a similar future period. Some needs would be able to be met locally: local transport, restaurants, builders, repairs and some food are examples as well as services such as street-lighting, libraries and refuse collection. The local distribution committee would then communicate needs that could not be met locally to the bodies charged with coordinating supplies to local communities.
The individual would have free access to the goods on the shelves of the local distribution centres; the local distribution centres free access to the goods they required to be always adequately stocked with what people needed; their suppliers free access to the goods they required from the factories which supplied them; industries and factories free access to the materials, equipment and energy they needed to produce their products; and so on. Production and distribution in socialism would thus be a question of organising a coordinated and more or less self-regulating system of linkages between users and suppliers, enabling resources and materials to flow smoothly from one productive unit to another, and ultimately to the final user, in response to information flowing in the opposite direction originating from final users. The productive system would thus be set in motion from the consumer end, as individuals and communities took steps to satisfy their self-defined needs. Socialist production is self-regulating production for use.
To ensure the smooth functioning of the system, statistical offices ( and many of those now exist ) would be needed to provide estimates of what would have to be produced to meet peoples likely individual and collective needs. These could be calculated in the light of consumer wants as indicated by returns from local distribution committees and of technical data (productive capacity, production methods, productivity, etc) incorporated in input-output tables. For, at any given level of technology (reflected in the input-output tables), a given mix of final goods (consumer wants) requires for its production a given mix of intermediate goods and raw materials; it is this latter mix that the central statistical office would be calculating in broad terms. Such calculations would also indicate whether or not productive capacity would need to be expanded and in what branches. The centre (or rather centres for each world-region) would thus be essentially an information clearing house, processing information communicated to it about production and distribution and passing on the results to industries for them to draw up their production plans so as to be in a position to meet the requests for their products coming from other industries and from local communities. The only calculations that would be necessary in socialism would be calculations in kind. On the one side would be recorded the resources (materials, energy, equipment, labour) used up in production and on the other side the amount of the good produced, together with any by-products.
Stock or inventory control systems employing calculation in kind are, as was suggested earlier, absolutely indispensable to any kind of modern production system. While it is true that they operate within a price environment today, that is not the same thing as saying they need such an environment in order to operate. The key to good stock management is the stock turnover rate – how rapidly stock is removed from the shelves – and the point at which it may need to be re-ordered. This will also be affected by considerations such as lead times – how long it takes for fresh stock to arrive – and the need to anticipate possible changes in demand.
To summarise a typical sequence of allocation and information flows in a socialist economy might be as follows. Lets assume a store stocks a certain consumer good – say, shoes and boots. From past experience it knows that it will need to re-order approximately 1000 pairs from its suppliers at the start of every month or, by the end of the month, supplies will be low. Assume that, for whatever reason, the rate of stock turnover increases sharply to say 2000 tins per month. This will require either more frequent deliveries or, alternatively, larger deliveries. Possibly the capacity of the distribution point may not be large enough to accommodate the extra quantity of footwear required in which case it will have to opt for more frequent deliveries. It could also add to its storage capacity but this would probably take a bit more time. In any event, this information will be communicated to its suppliers. These suppliers, in turn, may require additional leather or plastic , to make the shoes or boots to be processed and this information can similarly be communicated in the form of new orders to suppliers of those items further down the production chain. And so on and so forth. The whole process is, to a large extent, automatic – or self regulating – being driven by dispersed information signals from producers and consumers concerning the supply and demand for goods and, as such, is far removed from the gross caricature of a centrally planned economy.
Socialism will be a self regulating , decentralised inter-linked system to provide for a self sustaining steady state society. And we can set out a possible way of achieving an eventual zero growth steady state society operating in a stable and ecologically benign way. This could be achieved in three main phases. First, there would have to be emergency action to relieve the worst problems of food shortages, health care and housing which affect billions of people throughout the world. Secondly, longer term action to construct means of production and infrastructures such as transport systems for the supply of permanent housing and durable consumption goods. These could be designed in line with conservation principles, which means they would be made to last for a long time, using materials that where possible could be re-cycled and would require minimum maintenance. Thirdly, with these objectives achieved there could be an eventual fall in production, and society could move into a stable mode. This would achieve a rhythm of daily production in line with daily needs with no significant growth. On this basis, the world community could reconcile two great needs, the need to live in material well being whilst looking after the planet which is our shared home in space. Thus , we can settle Parecon's claims that moneyless society cannot calculate opportunity costs and allocate rationally :-
1) calculation in kind
2) a self regulating system of stock control - which identifies
quantities of stocks available and provides a reliable indication
of consumer demand (via the the depletion rates of stocks)
3) the law of the minimum - whereby you economise most on those
factors of production that are relatively scarcest
4) a social hierarchy of production goals - which sorts out the
allocation of scarce factors where competing demands are placed
upon them.
With this approach it is possible to ascertain opportunity costs. Assume a
particular factor X has 20 units in stock (as revealed via the self-regulating system of stock control mentioned above - feature 2). Assume there are two end-uses for X , end-use A and end-use B. Assume A requires 12 units of X and B requires 10 units of X.Clearly the full requirements for X for both A and B cannot both be met. If we chose to met A's requirements fully then the opportunity cost of this is a slight reduction in the output of B - and vice
versa. Deciding which end use should take priority is a function of feature 4 of a socialist allocative mechanism.
This mechanism will direct producers towards economically efficient outcomes for the economy as a functioning whole since every part of it is connected to every other part via a feedback system.
Simplicity .
MA alleges that from each according to ability , to each according to needs is an unachievable utopia , while elsewhere castigating Marxists for not being utopian enough , this Marx who also challenged the division of labour long before Balance Job Complexes when he described that “… in communist society, where nobody has one exclusive sphere of activity but each can become accomplished in any branch he wishes, society regulates the general production and thus makes it possible for me to do one thing today and another tomorrow, to hunt in the morning, fish in the afternoon, rear cattle in the evening, criticise after dinner, just as I have a mind, without ever becoming hunter, fisherman, shepherd or critic.” It was Marx , this not utopian enough Marx , who said in communism it will be society’s free (disposable) time and no longer labor time that becomes the true measure of society’s wealth. Nor should we forget his son-in-law Larfargue who wrote "The Right to be Lazy"
In socialist society , productive activity would take the form of freely chosen activity undertaken by human beings with a view to producing the things they needed to live and enjoy life. The necessary productive work of society would not be done by a class of hired wage workers but by all members of society, each according to their particular skills and abilities, cooperating to produce the things required to satisfy their needs both as individuals and as communities. Work in socialist society could only be voluntary since there would be no group or organ in a position to force people to work against their will. As to collective needs (schools, hospitals, theatres, libraries and the like), these could be decided by the groups of individuals concerned, using the various democratic representative bodies which they would create at different levels in socialist society. Thus production in socialism would be the production of free goods to meet self-defined needs, individual and collective . Society require a rational, long-term attitude towards conserving resources and yet present day society imposes intolerable conditions on the actual producers (speed-up, pain, stress, boredom, long hours, night work, shiftwork, accidents).
Socialism, because it will calculate directly it kind, will be able to take these other, more important, factors than production time into account. This will naturally lead to different, in many cases quite different, productive methods being adopted than now under capitalism. If the health, comfort and enjoyment of those who actually manipulate the materials, or who supervise the machines which do this, to transform them into useful objects is to be paramount, certain methods are going to be ruled out altogether. The fast moving production lines associated with the manufacture of cars would be stopped for ever ; night work would be reduced to the strict minimum; particularly dangerous or unhealthy jobs would be automated (or completely abandoned). Work can, in fact must, become enjoyable. But to the extent that work becomes enjoyable, measurement by minimum average working time would be completely meaningless, since people would not be seeking to minimize or rush such work.
And no matter how Parecon coats it with honey , people will be selling their labour power in exchange for the means to live and some will receive more and some will receive less .
The threat of the bureaucracy assuming a new class in socialism that Parecon spends many pages warning and organising to avoid simply cannot arise in this form of socialism . Free access to goods and services denies to any group or individuals the political leverage with which to dominate others (a feature intrinsic to all private-property or class based systems through control and rationing of the means of life ) . This will work to ensure that a socialist society is run on the basis of democratic consensus. Decisions will be made at different levels of organisation: global, regional and local with the bulk of decision-making being made at the local level. A socialist economy would be a polycentric, not a centrally planned, economy.Free access to the common treasury and no monopoly of ownership , not even by the producers who call for ownership of their own product ,( as promoted by mutualists and syndicalists ) can deprive individuals in society of common ownership of the means of production and distribution .
Parecons Co-ordinator class thesis is rather an academic one , in fact , for those who felt that the Russian Revolution was a failed revolution rather than what it was a still-born one , since after all the intelligentsia of the 19th century , Lenin's professional party cadres and the rise of soviet apparachiks were one and the same process . ( A bourgeois revolution without the bourgeoisie as some scholars have described it and Marx had envisaged the possibities of capitalism without the capitalist - "the collective capitalist" , "the associated capitalist" , "the national capitalist " employing "state" , "industrial" "social" capital perhaps co-ordinated through Central Bank to continue exploitation without individual ownership . )
The notion of status based upon the conspicuous consumption of wealth would be devoid of meaning because individuals would stand in equal relation to the means of production and have free access to the resultant goods and services . Again Parecon ( since of its support and the continued existence of a wages system and remuneration differentials ) cannot do away with a status hierarchy in which social esteem is closely related to an individual’s “pecuniary strength” , those at the top of this hierarchy exercising their pecuniary strength which provides the key signifier of social esteem in this hierarchy. Hence there remains emphasis on extravagant luxury which only the rich can really afford and those lower down this hierarchy imitating those higher up. We can readily guess that with luxury items rationed only to those that "deserve " by their work contribution settled by bjc committees , the less fortunate and more envious will endeavour to appropriate these luxuries by theft which will require Parecon police , Parecon lawyers and judges and ultimately Parecon jails and warders .
To have a system that allows wages to be dispensed on the basis of work carried out, allows money to circulate, and presumably restricts access to wealth ( food or housing) unless you have sufficient money to purchase something, doesn't seem to be too far from capitalism in terms of its outward appearance.
Parecon appears to me to be about building a massive (and socially unproductive) administration for policing all the wage levels, labour outputs prices etc. In contrast the practical aspects of a (world-) socialist revolution is not about creating ever greater bureaucratic structures, but quite the opposite - it will be about removing the barriers capitalism has developed which prohibit access to wealth, and at a stroke create an economic environment without individual (ie monetary or , in Pareconese, consumer credit accumulation ) incentives .
The reason that Parecon has to go to such lengths to construct such a complicated and complex (and wasteful system ) of elaborate checks and balances is ultimately that its proponents are unwilling or unable to accept that if given the right economic framework (or arguably no economic framework, as we maintain ) , then , in fact , humans can consciously co-operate, work and consume together.
Parecon doesn’t just “not go far enough”offering a model that retains major elements of the market system, but more importantly is simply highly unlikely to be workable in the real world.
Parecon is attractive to those who dislike capitalism, but who, in the final analysis, lack confidence that either there are sufficient resources on the planet to provide for all , or that human beings can work voluntarily, and co-operate to organise production & distribution of wealth without chaos, and consume wealth responsibly without some form of rationing .
In the end, Pareconists remain fixated to the lazy person, greedy individual critique of human behaviour as one pro-Pareconist has written - "Under the moneyless scheme, those with the least social consciousness or least sense of social responsibility will win out because they will be more aggressive in taking "free" items from the distribution centers. Since there is no requirement of work the "free riders" who do no work will burden the system to the point of collapse...Why, then, burden ourselves with the risky system of moneyless "free access," with its huge dangers of being dragged down by parasitical free riders?" .
Having laid down 5 rules to engaging in constructive discussion and accusing the editors of the Socialist Standard of failing to uphold this standard of intellectual honesty , yet MA in his article betrays that he has made little or no attempt whatsoever , not even by the briefest of Wikipedia searches , to seek out an understanding of the views of the WSM , or otherwise he woulds not have mistakenly associated the WSM with Trotsky " as in this excerpt , "...(The editors want to reject the Soviet system I hope for good reasons rather than only because Trotsky did, in the end.)...." and again here "...And all this is so, note,just by decree, by definition, by the authority of humpty dumpty, in my view, and I guess Trotsky, or whoever, in the editors' view..." . MA is unaware that the WSM was perhaps the earliest critics of Bolshevism from 1918 , very much alone and against the popular feeling within the socialist movement when they questioned the validity of the Bolshevik claims . MA , nevertheless , unintentionally reveals that his attitude is that all criticism of Russia begins and ends with Trotsky or Trotskyists , (which explains the obssession with bureaucracy of the deformed workers state or bureaucratic collective state or whatever neo- or ex--Trotskyist of Russia view MA adheres to .)
He failed to practice what he preached , to seek an understanding of his opponents position. His 5 precepts of debate are more a matter of "Do what i say . Not what i do ." to score debating points
We employ "obscurantist jargon" according to MA - and of course Parecon doesn't , but forgive me , but a whole glossary of Parecon terms meanings is required and words redefined to mean what they aren't such as remuneration doesn't really mean wages . However , as someone who can judge that Joan Robinson "as one of the more knowledgeable people in marxist economics in the world" he fails to recognise Marxist terminology and concepts that he so readily dismisses as obscurant .
But i do not consider that a necessary failing because Marx was required to de-mystify existing language by creating or re-defining those new terms to reach the kernel of the social problems , just as Parecon writers have also been required to do to elaborate its ideas .
Marx is famous for his anti-philosophy quotation "philosphers have only interpret the world , the point is to change it " to paraphrase , yet amazingly enough what is often over looked is the sub-title of Capital - " A Contribution to a critique of political economy " . Marx desired the abolition of economics , the same objective shared by the WSM who wish to challenge the assumptions and preconceived ideas of those economists that endeavour to re-create social relationships in the image of the existing society . Marx was not writing as a simple economist but was putting forward a “critique of political economy” , his main argument being that, whereas writers like Adam Smith and Ricardo regarded economic categories such as capital, wages, value, price, money, etc as eternal, natural features of human social existence, these were in fact categories of capitalism which would disappear when it did.
Conventional academic economics declare that the true state of the world is scarcity - limited supply - versus- boundless demand , denying the potential for a state of abundance can exist.Our wants are essentially “infinite” and the resources to meet them, limited , claim the economists . However in the real world , abundance is not a situation where an infinite amount of every good could be produced . Similarly, scarcity is not the situation which exists in the absence of this impossible total or sheer abundance.( It is these economists who really are the Humpty Dumpties when it comes to re-defining words , not ourselves ) . Abundance is a situation where productive resources are sufficient to produce enough wealth to satisfy human needs, while scarcity is a situation where productive resources are insufficient for this purpose. Admitting this would mean the end, not only of the economy as a system of allocating scarce resources but also of goods having an economic value and price; goods would simply become useful things produced for human beings to take and use, while economics as the study of the most rational way to employ scarce resources would give way to the study of how best to use abundant resources to produce free goods in the amounts required to satisfy human needs .This is the purpose of the WSM , to speed the day towards free access and the end of economics . That is what could be described as a revolutionary concept and not the idealised buying and selling world of commerce without exploitation that Parecon wishes to establish.
The real discussion is how to provide for the needs of all using the ingenuity of the human race . That is the big X which both MA and WSM share and wish to address . So lets use the napkins as recommended by MA to outline the type of new society we desire without any reference to Marx's Labour Theory of Value . Just some application of common sense to solve a pressing problem . Let us compare one with another . Participatory Economics V Free Access Socialism .
"When I tell them that this means they have not only jettisoned prices, income, etc., but they have done away with all possibility of sensible allocation because they have no way to decide between options based on valuations ... ", they simply ignore it. When I tell them they have also done away with all possibility of attaining just distribution because, again, there is no way to say to a consumer, or for a consumer to even know that some amount is more (or less) than he or she should have, or to say to a worker, or for a worker to even know, some level of work is more (or less) than you should be doing - the editors think they don't need to answer....they don't offer a serious set of institutions without those features and show their viability - though perhaps somewhere else they do and I am just unaware of it - though I very much doubt it. "
And in case we never understood the first time , MA repeats it
"...And yes, people have incomes, or said differently, have budgets, which limit how much ofthe social product they are entitled to. And yes, allocation decisions about what to produce using resources and labor, etc. and about who winds up producing it or getting it, use valuations and are impacted by budgets. Not only does all this happen in a parecon, but more, I claim if it didn't the system would be utterly incapable of functioning intelligently, or even at all, much less functioning equitably and with self management. That ought to be trivially apparent. You can't make sound judgements about producing one item instead of some other, or vice versa, without knowing how much cost and benefit the item and its production involve..."
And MA KNOWS that only prices and money can be used to rationally organise society because the professors text-books say sot, thus it must be true and a law as natural as the Law of Gravity . Another example of MA not practicing what he preaches .
MA reveals this slavery to orthodox capitalist economists when he employs what is called the Economic Calculation Argument (developed by Von Mises , even if MA declines to quote chapter and verse of Mises , he nevertheless , accepts it without questioning the actual requirement of a pricing mechanism for the well-being of society . It is automatically taken as fact , an economic law ).
And YES he is unaware of our rebuttals and our own analysis of future society because he did not follow his own admonishments and recommendations for healthy exchange of views and research his opponents webpages .
Let us begin with prices and how practical allocation of resources do not require the intervention of a pricing mechanism and how resources can be rationally allocated in a moneyless society .
A monetary economy gives rise to the illusion that the “cost” of producing something is merely financial . Money is the universal unit of measurement, the “general equivalent” that allows everything to be compared with everything else under all circumstances—but only in terms of their labour-time cost or the total time needed on average to produce them from start to finish.Such non-monetary calculation of course already happens, on the technical level, under capitalism. Once the choice of productive method has been made (according to expected profitability as revealed by monetary calculation) then the real calculations in kind of what is needed to produce a specific good commence so much raw materials, so much energy, so much labour.In socialism it is not the case that the choice of productive method will become a technical choice that can be left to engineers (perhaps those of the co-ordinator class that MA fears ) , as is sometimes misunderstood by critics, but that this choice too will be made in real terms, in terms of the real advantages and disadvantages of alternative methods and in terms of, on the one hand, the utility of some good or some project in a particular circumstance at a particular time and, on the other hand, of the real “costs” in the same circumstances and at the same time of the required materials, energy and productive effort.
By the replacement of exchange economy by common ownership basically what would happen is that wealth would cease to take the form of exchange value, so that all the expressions of this social relationship peculiar to an exchange economy, such as money and prices, would automatically disappear. In other words, goods would cease to have an economic value and would become simply physical objects which human beings could use to satisfy some want or other. The disappearance of economic value would mean the end of economic calculation in the sense of calculation in units of value whether measured by money or directly in some unit of labour-time. It would mean that there was no longer any common unit of calculation for making decisions regarding the production of goods. This is MA contention , that without prices we can not allocate resources . The WSM counter this with the proposal that socialism, as a moneyless society in which use values would be produced from other use values, there would need no have a universal unit of account but could calculate exclusively in kind .The only calculations that would be necessary in socialism would be calculations in kind. On the one side would be recorded the resources (materials, energy, equipment, labour) used up in production and on the other side the amount of the good produced, together with any by-products. This, of course, is done under capitalism but it is doubled by an exchange value calculation: the exchange value of the resources used up is recorded as the cost of production while the exchange value of the output (after it has been realised on the market) is recorded as sales receipts. If the latter is greater than the former, then a profit has been made; if it is less, then a loss is recorded. Such profit-and-loss accounting has no place in socialism and would, once again, be quite meaningless.
Calculation in kind entails the counting or measurement of physical quantities of different kinds of factors of production. There is no general unit of accounting involved in this process such as money or labour hours or energy units. In fact, every conceivable kind of economic system has to rely on calculation in kind, including capitalism. Without it, the physical organisation of production (e.g. maintaining inventories) would be literally impossible. But where capitalism relies on monetary accounting as well as calculation in kind, socialism relies solely on the latter. This is one reason why socialism holds a decisive productive advantage over capitalism AND Parecon by eliminating the need to tie up vast quantities of resources and labour implicated in a system of monetary/pricing accounting.
MA tells us that without the guidance of prices socialism would sink into inefficiency . “Socialism” or “communism” has for the WSM meant a society without markets, money, wage labour or a state. All wealth would be produced on a strictly voluntary basis. Goods and services would be provided directly for self determined need and not for sale on a market; they would be made freely available for individuals to take without requiring these individuals to offer something in direct exchange. The sense of mutual obligations and the realisation of universal interdependency arising from this would profoundly colour people’s perceptions and influence their behaviour in such a society. We may thus characterise such a society as being built around a moral economy and a system of generalised reciprocity.
Lets get to the practicalities of Free Access Socialism .
The problem with a centrally-planned model of socialism was its inability to cope with change. It lacks any kind of feedback mechanism which allows for mutual adjustments between the different actors in such an economy. It is completely inflexible We witnessed in Russia how it was unable to determine prices by central planning. Prices were set , re-set , fixed then re-fixed , plans were made then re-appraised , re-defined , changed and dropped .
Socialism however is a decentralised or polycentric society that is self regulating , self adjusting and self correcting , from below and not from the top . It is not a command economy but a responsive one .
Stock or inventory control systems employing calculation in kind are absolutely indispensable to any kind of modern production system. While it is true that today they operate within a price environment that is not the same thing as saying they need such an environment in order to operate. Most students of Logistics will be able to explain how unnecessary dollars and cents are for its operation. The key to good stock management is the stock turnover rate – how rapidly stock is removed from the shelves – and the point at which it may need to be re-ordered. This will also be affected by considerations such as lead times – how long it takes for fresh stock to arrive – and the need to anticipate possible changes in demand. The Just- In- Time systems are another tried and trusted tool of warehousing and supply chains which can be utilised . And even so the existence of buffer stocks provides for a period of re-adjustment. We even have the existence of store "loyalty cards" that can be put to more creative and constructive non-commercial usage . Socialism does not necessary involve the creation of new layers of administrations but simply the transformation of them . There will be little need for the creation of Iteration Facilitation Boards to produce indicative prices
The “law of the minimum” was formulated by an agricultural chemist, Justus von Liebig in the 19th century. Liebig’s Law can be applied equally to the problem of resource allocation in any economy.For any given bundle of factors required to produce a given good, one of these will be the limiting factor. That is to say, the output of this good will be restricted by the availability of the factor in question constituting the limiting factor. All things being equal, it makes sense from an economic point of view to economise most on those things that are scarcest and to make greatest use of those things that are abundant. Factors lying in between these two poles can be treated accordingly in relative terms.
Actually to claim that all factors are scarce (because the use of any factor entails an opportunity cost) and, consequently, need to be economised is not a very sensible approach to adopt. Effective economisation of resources requires discrimination and selection; you cannot treat every factor equally – that is, as equally scarce – or, if you do, this will result in gross misallocation of resources and economic inefficiency.
In any economy there needs to be some way of prioritising production goals.How might these priorities be determined? We can apply Maslow’s “hierarchy of needs” as a guide to action. It would seem reasonable to suppose that needs that were most pressing and upon which the satisfaction of other needs are dependant would take priority over those other needs. We are talking here about our basic physiological needs for food, water, adequate sanitation and housing and so on. This would be reflected in the allocation of resources: high priority end goals would take precedence over low priority end goals where resources common to both are revealed (via the self regulating system of stock control) to be in short supply .
We can also speculate, that some kind of “points system” might be used with which to evaluate a range of different projects facing such a society . Again those more qualified can explain how cost-benefit analysis is not dependant upon dollars and cents calculations, as even now ecological concerns are required to be taken into consideration in planning . In fact each day we all individually use various methods of adding up pros and cons to determine actions . Naturally, under capitalism ( read Parecon) the balance sheet of the relevant benefits and costs advantages and disadvantages of a particular scheme or rival schemes is drawn up in money terms , but in socialism a points system for attributing relative importance to the various relevant considerations could be used instead. The points attributed to these considerations would be subjective, in the sense that this would depend on a deliberate social decision rather than on some objective standard. In the sense that one of the aims of socialism is precisely to rescue humankind from the capitalist fixation with production time/money, cost-benefit type analyses, as a means of taking into account other factors, could therefore be said to be more appropriate for use in socialism than under capitalism. Using points systems to attribute relative importance in this way would not be to recreate some universal unit of evaluation and calculation, but simply to employ a technique to facilitate decision-making in particular concrete cases. The advantages /disadvantages and even the points attributed to them can, and normally would, differ from case to case. So what we are talking about is not a new abstract universal unit of measurement to replace money and economic value but one technique among others for reaching rational decisions in a society where the criterion of rationality is human welfare.
Marx and the WSM has been generally reluctant about producing "recipes for the cook-shops of tomorrow" ( unlike the detailed and specific constructs of Parecon ) but a broad picture would be that production- for- use would operate in direct response to need . These would arise in local communities expressed as required quantities such as grammes , kilos , tonnes , litres , metres , cubic metres , etc , of various materials and quantities of goods . These would then be communicated as required elements of productive activity , as a technical sequence, to different scales of social production , according to necessity .Each particular part of production would be responding to the material requirements communicated to it through the connected ideas of social production . It would be self -regulating , because each element of production would be self-adjusting to the communication of these material requirements . Each part of of production would know its position . If requirements are low in relation to a build-up of stock , then this would an automatic indication to a production unit that its production should be reduced . If The register of needs and the communication of every necessary element of those needs to the structure of production would be clear and readily known . The supply of some needs will take place within the local community and in these cases production would not extent beyond this , as for example with local food production for local consumption .Other needs could be communicated as required things to the regional organisation of production. Local food production would require glass, but not every local community could have its own glass works . The requirements for glass could be communicated to a regional glass works . These would be definite quantities of required glass . The glass works has its own suppliers of materials , and the amounts they require for the production of 1 tonne of glass are known in definite quantities. The required quantities of these materials could be passed by the glass works to the regional suppliers of the materials for glass manufacture . This would be a sequence of communication of local needs to the regional organisation of production, and thus contained within a region .Local food production would also require tractors, and here the communication of required quantities of things could extend further to the world organisation of production . Regional manufacture could produce and assemble he component parts of tractors for distribution to local communities .These would be required in a definite number and , on the basis of this definite number of final products , the definite number of component parts for tractors would also be known . The regional production unit producing tractor would communicate these definite quantities to their own suppliers , and eventually this would extend to world production units extracting and processing the necessary materials .This would be the self-regulating system of production for need , operating on the basis of the communication of need as definite quantities of things throughout the structure of production . Each production unit would convert the requirements communicated to it into its own material requirements and pass these on to its suppliers . This would be the sequence by which every element of labour required for the production of a final product would be known .This system of self-regulating production for use is achieved through communications . Socialism would make full use of the means communications which have developed . These include not only transport such as roads , railways , shipping etc. They also include the existing system of electronic communications which provide for instant world-wide contact as well as facilities for storing and processing millions of pieces of information . Modern information technology could be used by socialism to integrate any required combination of different parts of its world structure of production . Simpler is Better.
Planning in socialism is essentially a question of industrial organisation, of organising productive units into a productive system functioning smoothly to supply the useful things which people had indicated they needed, both for their individual and for their collective consumption. What socialism would establish would be a rationalised network of planned links between users and suppliers; between final users and their immediate suppliers, between these latter and their suppliers, and so on down the line to those who extract the raw materials from nature. There is no point in drawing up in advance the sort of detailed blueprint of industrial organisation that the old IWW and the Syndicalists used to and what Parecon now does , but it is still reasonable to assume that productive activity would be divided into branches and that production in these branches would be organised by a delegate body. The responsibility of these industries would be to ensure the supply of a particular kind of product either, in the case of consumer goods, to distribution centres or, in the case of goods used to produce other goods, to productive units or other industries.
Since the needs of consumers are always needs for a specific product at a specific time in a specific locality, we will assume that socialist society would leave the initial assessment of likely needs to a delegate body under the control of the local community (although, other arrangements are possible if that were what the members of socialist society wanted). In a stable society such as socialism, needs would change relatively slowly. Hence it is reasonable to surmise that an efficient system of stock control, recording what individuals actually chose to take under conditions of free access from local distribution centres over a given period, would enable the local distribution committee to estimate what the need for food, drink, clothes and household goods would be over a similar future period. Some needs would be able to be met locally: local transport, restaurants, builders, repairs and some food are examples as well as services such as street-lighting, libraries and refuse collection. The local distribution committee would then communicate needs that could not be met locally to the bodies charged with coordinating supplies to local communities.
The individual would have free access to the goods on the shelves of the local distribution centres; the local distribution centres free access to the goods they required to be always adequately stocked with what people needed; their suppliers free access to the goods they required from the factories which supplied them; industries and factories free access to the materials, equipment and energy they needed to produce their products; and so on. Production and distribution in socialism would thus be a question of organising a coordinated and more or less self-regulating system of linkages between users and suppliers, enabling resources and materials to flow smoothly from one productive unit to another, and ultimately to the final user, in response to information flowing in the opposite direction originating from final users. The productive system would thus be set in motion from the consumer end, as individuals and communities took steps to satisfy their self-defined needs. Socialist production is self-regulating production for use.
To ensure the smooth functioning of the system, statistical offices ( and many of those now exist ) would be needed to provide estimates of what would have to be produced to meet peoples likely individual and collective needs. These could be calculated in the light of consumer wants as indicated by returns from local distribution committees and of technical data (productive capacity, production methods, productivity, etc) incorporated in input-output tables. For, at any given level of technology (reflected in the input-output tables), a given mix of final goods (consumer wants) requires for its production a given mix of intermediate goods and raw materials; it is this latter mix that the central statistical office would be calculating in broad terms. Such calculations would also indicate whether or not productive capacity would need to be expanded and in what branches. The centre (or rather centres for each world-region) would thus be essentially an information clearing house, processing information communicated to it about production and distribution and passing on the results to industries for them to draw up their production plans so as to be in a position to meet the requests for their products coming from other industries and from local communities. The only calculations that would be necessary in socialism would be calculations in kind. On the one side would be recorded the resources (materials, energy, equipment, labour) used up in production and on the other side the amount of the good produced, together with any by-products.
Stock or inventory control systems employing calculation in kind are, as was suggested earlier, absolutely indispensable to any kind of modern production system. While it is true that they operate within a price environment today, that is not the same thing as saying they need such an environment in order to operate. The key to good stock management is the stock turnover rate – how rapidly stock is removed from the shelves – and the point at which it may need to be re-ordered. This will also be affected by considerations such as lead times – how long it takes for fresh stock to arrive – and the need to anticipate possible changes in demand.
To summarise a typical sequence of allocation and information flows in a socialist economy might be as follows. Lets assume a store stocks a certain consumer good – say, shoes and boots. From past experience it knows that it will need to re-order approximately 1000 pairs from its suppliers at the start of every month or, by the end of the month, supplies will be low. Assume that, for whatever reason, the rate of stock turnover increases sharply to say 2000 tins per month. This will require either more frequent deliveries or, alternatively, larger deliveries. Possibly the capacity of the distribution point may not be large enough to accommodate the extra quantity of footwear required in which case it will have to opt for more frequent deliveries. It could also add to its storage capacity but this would probably take a bit more time. In any event, this information will be communicated to its suppliers. These suppliers, in turn, may require additional leather or plastic , to make the shoes or boots to be processed and this information can similarly be communicated in the form of new orders to suppliers of those items further down the production chain. And so on and so forth. The whole process is, to a large extent, automatic – or self regulating – being driven by dispersed information signals from producers and consumers concerning the supply and demand for goods and, as such, is far removed from the gross caricature of a centrally planned economy.
Socialism will be a self regulating , decentralised inter-linked system to provide for a self sustaining steady state society. And we can set out a possible way of achieving an eventual zero growth steady state society operating in a stable and ecologically benign way. This could be achieved in three main phases. First, there would have to be emergency action to relieve the worst problems of food shortages, health care and housing which affect billions of people throughout the world. Secondly, longer term action to construct means of production and infrastructures such as transport systems for the supply of permanent housing and durable consumption goods. These could be designed in line with conservation principles, which means they would be made to last for a long time, using materials that where possible could be re-cycled and would require minimum maintenance. Thirdly, with these objectives achieved there could be an eventual fall in production, and society could move into a stable mode. This would achieve a rhythm of daily production in line with daily needs with no significant growth. On this basis, the world community could reconcile two great needs, the need to live in material well being whilst looking after the planet which is our shared home in space. Thus , we can settle Parecon's claims that moneyless society cannot calculate opportunity costs and allocate rationally :-
1) calculation in kind
2) a self regulating system of stock control - which identifies
quantities of stocks available and provides a reliable indication
of consumer demand (via the the depletion rates of stocks)
3) the law of the minimum - whereby you economise most on those
factors of production that are relatively scarcest
4) a social hierarchy of production goals - which sorts out the
allocation of scarce factors where competing demands are placed
upon them.
With this approach it is possible to ascertain opportunity costs. Assume a
particular factor X has 20 units in stock (as revealed via the self-regulating system of stock control mentioned above - feature 2). Assume there are two end-uses for X , end-use A and end-use B. Assume A requires 12 units of X and B requires 10 units of X.Clearly the full requirements for X for both A and B cannot both be met. If we chose to met A's requirements fully then the opportunity cost of this is a slight reduction in the output of B - and vice
versa. Deciding which end use should take priority is a function of feature 4 of a socialist allocative mechanism.
This mechanism will direct producers towards economically efficient outcomes for the economy as a functioning whole since every part of it is connected to every other part via a feedback system.
Simplicity .
MA alleges that from each according to ability , to each according to needs is an unachievable utopia , while elsewhere castigating Marxists for not being utopian enough , this Marx who also challenged the division of labour long before Balance Job Complexes when he described that “… in communist society, where nobody has one exclusive sphere of activity but each can become accomplished in any branch he wishes, society regulates the general production and thus makes it possible for me to do one thing today and another tomorrow, to hunt in the morning, fish in the afternoon, rear cattle in the evening, criticise after dinner, just as I have a mind, without ever becoming hunter, fisherman, shepherd or critic.” It was Marx , this not utopian enough Marx , who said in communism it will be society’s free (disposable) time and no longer labor time that becomes the true measure of society’s wealth. Nor should we forget his son-in-law Larfargue who wrote "The Right to be Lazy"
In socialist society , productive activity would take the form of freely chosen activity undertaken by human beings with a view to producing the things they needed to live and enjoy life. The necessary productive work of society would not be done by a class of hired wage workers but by all members of society, each according to their particular skills and abilities, cooperating to produce the things required to satisfy their needs both as individuals and as communities. Work in socialist society could only be voluntary since there would be no group or organ in a position to force people to work against their will. As to collective needs (schools, hospitals, theatres, libraries and the like), these could be decided by the groups of individuals concerned, using the various democratic representative bodies which they would create at different levels in socialist society. Thus production in socialism would be the production of free goods to meet self-defined needs, individual and collective . Society require a rational, long-term attitude towards conserving resources and yet present day society imposes intolerable conditions on the actual producers (speed-up, pain, stress, boredom, long hours, night work, shiftwork, accidents).
Socialism, because it will calculate directly it kind, will be able to take these other, more important, factors than production time into account. This will naturally lead to different, in many cases quite different, productive methods being adopted than now under capitalism. If the health, comfort and enjoyment of those who actually manipulate the materials, or who supervise the machines which do this, to transform them into useful objects is to be paramount, certain methods are going to be ruled out altogether. The fast moving production lines associated with the manufacture of cars would be stopped for ever ; night work would be reduced to the strict minimum; particularly dangerous or unhealthy jobs would be automated (or completely abandoned). Work can, in fact must, become enjoyable. But to the extent that work becomes enjoyable, measurement by minimum average working time would be completely meaningless, since people would not be seeking to minimize or rush such work.
And no matter how Parecon coats it with honey , people will be selling their labour power in exchange for the means to live and some will receive more and some will receive less .
The threat of the bureaucracy assuming a new class in socialism that Parecon spends many pages warning and organising to avoid simply cannot arise in this form of socialism . Free access to goods and services denies to any group or individuals the political leverage with which to dominate others (a feature intrinsic to all private-property or class based systems through control and rationing of the means of life ) . This will work to ensure that a socialist society is run on the basis of democratic consensus. Decisions will be made at different levels of organisation: global, regional and local with the bulk of decision-making being made at the local level. A socialist economy would be a polycentric, not a centrally planned, economy.Free access to the common treasury and no monopoly of ownership , not even by the producers who call for ownership of their own product ,( as promoted by mutualists and syndicalists ) can deprive individuals in society of common ownership of the means of production and distribution .
Parecons Co-ordinator class thesis is rather an academic one , in fact , for those who felt that the Russian Revolution was a failed revolution rather than what it was a still-born one , since after all the intelligentsia of the 19th century , Lenin's professional party cadres and the rise of soviet apparachiks were one and the same process . ( A bourgeois revolution without the bourgeoisie as some scholars have described it and Marx had envisaged the possibities of capitalism without the capitalist - "the collective capitalist" , "the associated capitalist" , "the national capitalist " employing "state" , "industrial" "social" capital perhaps co-ordinated through Central Bank to continue exploitation without individual ownership . )
The notion of status based upon the conspicuous consumption of wealth would be devoid of meaning because individuals would stand in equal relation to the means of production and have free access to the resultant goods and services . Again Parecon ( since of its support and the continued existence of a wages system and remuneration differentials ) cannot do away with a status hierarchy in which social esteem is closely related to an individual’s “pecuniary strength” , those at the top of this hierarchy exercising their pecuniary strength which provides the key signifier of social esteem in this hierarchy. Hence there remains emphasis on extravagant luxury which only the rich can really afford and those lower down this hierarchy imitating those higher up. We can readily guess that with luxury items rationed only to those that "deserve " by their work contribution settled by bjc committees , the less fortunate and more envious will endeavour to appropriate these luxuries by theft which will require Parecon police , Parecon lawyers and judges and ultimately Parecon jails and warders .
To have a system that allows wages to be dispensed on the basis of work carried out, allows money to circulate, and presumably restricts access to wealth ( food or housing) unless you have sufficient money to purchase something, doesn't seem to be too far from capitalism in terms of its outward appearance.
Parecon appears to me to be about building a massive (and socially unproductive) administration for policing all the wage levels, labour outputs prices etc. In contrast the practical aspects of a (world-) socialist revolution is not about creating ever greater bureaucratic structures, but quite the opposite - it will be about removing the barriers capitalism has developed which prohibit access to wealth, and at a stroke create an economic environment without individual (ie monetary or , in Pareconese, consumer credit accumulation ) incentives .
The reason that Parecon has to go to such lengths to construct such a complicated and complex (and wasteful system ) of elaborate checks and balances is ultimately that its proponents are unwilling or unable to accept that if given the right economic framework (or arguably no economic framework, as we maintain ) , then , in fact , humans can consciously co-operate, work and consume together.
Parecon doesn’t just “not go far enough”offering a model that retains major elements of the market system, but more importantly is simply highly unlikely to be workable in the real world.
Parecon is attractive to those who dislike capitalism, but who, in the final analysis, lack confidence that either there are sufficient resources on the planet to provide for all , or that human beings can work voluntarily, and co-operate to organise production & distribution of wealth without chaos, and consume wealth responsibly without some form of rationing .
In the end, Pareconists remain fixated to the lazy person, greedy individual critique of human behaviour as one pro-Pareconist has written - "Under the moneyless scheme, those with the least social consciousness or least sense of social responsibility will win out because they will be more aggressive in taking "free" items from the distribution centers. Since there is no requirement of work the "free riders" who do no work will burden the system to the point of collapse...Why, then, burden ourselves with the risky system of moneyless "free access," with its huge dangers of being dragged down by parasitical free riders?" .
Tuesday, June 10, 2008
India - the booming economy ?
"Sometimes we get work, sometimes we don't. Together with our children we are dying from hunger. What can we poor people do? Nothing."
There are around 10 million children in the Indian state of Madhya Pradesh . A decade ago 55% were malnourished. Two years ago the government's own National Family Health Survey put the figure for Madhya Pradesh at around 60%.
"Because of the increase in food prices a mother cannot buy an adequate quantity of milk, fruits and vegetables. So their staple diet has become wheat chapattis," she explains. "A child cannot survive on wheat chapattis alone. About 80% of mothers and children are anaemic because they can't get good quality food."
The problem of malnutrition is getting worse, not better.
There are around 10 million children in the Indian state of Madhya Pradesh . A decade ago 55% were malnourished. Two years ago the government's own National Family Health Survey put the figure for Madhya Pradesh at around 60%.
"Because of the increase in food prices a mother cannot buy an adequate quantity of milk, fruits and vegetables. So their staple diet has become wheat chapattis," she explains. "A child cannot survive on wheat chapattis alone. About 80% of mothers and children are anaemic because they can't get good quality food."
The problem of malnutrition is getting worse, not better.
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