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Twenty years ago Michael Albert already developed an alternative economic system. It offers not only an alternative to capitalism but also to a centrally planned socialism and a so called bio-regionalism, the idea that regions should function autonomous from each other. Albert calls the economic alternative “participatory economics”. Instead of pushing inequality and competition the economy should be designed to further solidarity and mutual help. To achieve this aim four institutional commitments are necessary, says Albert: Workers and consumers self-managing councils, equitable enumeration for the ratio of intensity and onerousness of socially valued labor, balanced job complexes and participatory planning. The overarching goal must be classlessness. Participatory economics not only want to get rid of markets and the 2-percent-owner-class as driving forces behind the economy but also the 20-percent-coordinator-class of engineers, lawyers or managers who monopolize all the empowering tasks in society. These tasks should be spread over the whole population.


Michael Albert: US writer, activist and economist, co-founder of ZMag and t ZNet, author of "Realizing Hope. Life Beyond Capitalism" and "Parecon" ("Participatory Economics")


Fabian Scheidler: Welcome to Kontext TV. In the wake of the financial and economic crisis in the US and Europe as well as the social protests around the world a basic critique of capitalism and a discussion about alternatives has gained again some form of attention

David Goessmann: At the same time a lot of people in Europe and in the US are dissatisfied with the economic system. According to polls 80 per cent of Germans want a different economic system. 40 per cent of the population in the United States has a negative attitude toward capitalism. In a Pew Research Center poll a majority of young Americans prefered socialism over market economy.

Fabian Scheidler: In this broadcast we want to talk about alternatives. Our guest is US writer, activist and economist Michael Albert. More than 20 years ago he already outlined an alternative economic system which he calls Participatory Economy or Parecon. Recently he founded the International Organization for a Participatory Society. It should be a global network for movements, activists and dissidents with national chapters around the world, also in Europe.

David Goessmann: Michael Albert is Co-founder of the alternative publishing House South End Press and ZNet, one of the most renowned global platforms for left critique, social change and activism, where dissidents like Noam Chomsky, Arundhati Roy, John Pilger, Naomi Klein or Tariq Ali are regularly publishing articles and essays. Albert is author of many books, among them “Realizing Hope: Life Beyond Capitalism”.

David Goessmann: You have outlined an alternative economic system not only to capitalism but also to a centrally planned socialism and bio-regionalism. You call it a participatory economy. Explain exactly what you mean by that.

Michael Albert: It means to be an alternative to capitalism which is just the system we live on in the United States, you live onto in Germany. It means to be an alternative to the system called central-planned economy, it is typically called centrally planned socialist economy, I call it centrally planned economy, we will come to that in a second, what was in East Germany, Soviet Union and so on. It is also an alternative to that. And, as you say, it is also an alternative to another idea as it existed, bio-regionalism, a concept that a region should be self-sufficient and should function sort of autonomously from one another. Okay, so participatory economics basically is not a blueprint. It says, here are some key institutional commitments at the heart of an economy which is, if we have these then we will have an economy which is desirable. We all have an economy which does not have classes. It does not have one set of people dominating, ruling  aggrandising  themselves of the expenses of another set of people. Moreover, it will help people controlling their own life, manage themselves. It will have diversity of outcomes, it will have solidarity between people and otherwise it won't have as markets do for example a context in which to get ahead you have to trample on others. Rather it will have a context in which there is mutual aid. So, what kind of institutions accomplishes these kinds of ends? Equitable distribution, so it is fair. Participatory economics advocates just a few simple institutions. One, worker and consumer assemblies or councils. In some places you would call it council, I call it. They are self-managing. That just means that in the workplace, for example, the workers which is everybody in the workplace, constitute a council or an assembly of the workplace and they are the decision-making body. And they make decisions in a manner that is organized by the principle of self-management. And the principle means, I should have a say decisions in proportion to how I am effected by them. And so should everybody else. So there is not somebody who has way disproportionate to say and other people have less say. So that is one institution. We can talk more about if you want. Second institution has to do with income distribution. Society and economy produces a lot of stuff. Think of this as a giant pie. When we talk about the income distribution we are talking about which slice of the pie you get, maybe the quality of the slice. So it is the amount and the quality. Your share of the social output. And there are lots of norms that you could have for that. You could say people should get a slice that is proportionate to the amount of productive assets, of means of production that they own. So in that case Bill Gates is worth more say than the population of Norway that I do not know, but it is probably close to true, and more than the population of few countries in Central America. That is why I do not like that option. These are values. It is not like two and two is four. It is not true or false. You either like it or you do not like it. I do not like it. It is not equitable, it is not fair, it is not just, it is not humane. Another possible norm that you could have is that people get the income based on the power: I am more powerful and I can take more, I get more. It is a bargaining process, so your power determines your income. So that is actually operative in market systems. That is quite typical in Germany, say, and in the United States. Both the property and the power norm come into play. Another norm which people think is at play, which I do not like anyway but a lot of socialists like it, a lot of market socialists, socially-planned socialists like, it says that you get back in proportion to the amount that you contribute. So if I produce by my efforts, by my labor a certain amount of that social pie I should get back essentially the equivalent amount. Not same stuff. Maybe I produce only bicycles then I do not get back only bicycles, but I get back an amount that is comparable in value to the amount I produce. This means that Michael Jordan was under paid when he was earning 20, 30 mio dollars a year, because the value of his product way more. Leftist do not want to hear this, but the value of his product in terms of how much people wanted to see Michael Jordan play basketball was way more than 20 mio dollars. Who else got it? The people with property. The owners of Nike, the owners of the basketball team, TV network. Lots of owners got it, people who had more power than him. He did not have enough power to take a lot. But if you paid him according to output he would have gotten even more. And I do not like that, I do not think people should on top of being lucky enough to be born with some incredible talent: Frank Sinatra's voice, Michael Jordan´s athletic powers, Chomsky's Brain, whatever. To be lucky enough to be born with these attributes, showered with wealth on top of this makes no sense to me. You should not get an award for having won in the genetic lottery. So, if you are not going enumerate for power, and you are not going to enumerate for output, and you are not going to enumerate property, what are you going to enumerate for? Well, the second institutional commitment of participatory economics is to enumerate for how long you work, for how hard you work, and for the intensity of your work, so how hard you work. So it is duration and intensity and then the onerous conditions. So in other words if I work longer I get more, if I work harder I get more, if I work under worse conditions I get more. As long as I am producing something valuable. I cannot produce junk and get enumerated for it. I cannot be the Goldie for the German national soccer team and get enumerated for it because it is worthless, so I cannot do that. But I can do something that I can do and get enumerated for how long I do it, how hard I do it and the conditions. That is the second institutional commitment. Third institutional commitment is about balanced job complexes. This one gets slightly more complicated but not much. In contemporary economies like Germany and the United States there is the owning class. Occupy movement to say the 1 %, it is actually like 2 % I think, who basically own the productive assets of society and who are incredibly powerful and incredibly wealthy. And then there are working people who have no say, have no power, have no circumstances that give them an ability to take much of income. But in between those two there is another group. And that other group is call the coordinator class. And that other group does have something. The owners have a monopoly on property. The coordinator class has a monopoly of empowering tasks and positions in an economy, so lawyers and doctors and engineers, various other actors, accountants and so on, high level managers who have the empowering work and the power that comes with the empowering work which gives them the ability to take from that social product that pie a lot of income and to have a lot of say about the direction of the economy. That class in between labor and capital, the coordinator class can become the new ruling class. That is the system called centrally-planned socialism and market socialism. Does away with owners, does away with capitalists, but it leaves that 20 % and that is what it is, roughly 20 % in charge. So, participatory socialism wants that wants classlessness. But it not only wants to get rid of private ownership of all the workplace and all the resources and everything else that are in the hands of 2 %. But it wants also to get rid of 20 % monopolizing all the empowering work. And there is only one solution. And that is get rid of it. You cannot have 20 % monopolizing all the empowering work. This is not complicated. So that means you must distribute it among the population. So you must have something which we call balanced job complexes, which simply means that everybody in the economy who is working does a mix of responsibilities and tasks and activities. And the mix is such that each person has comparable empowering work. So you no longer have somebody who is doing only empowering tasks. All get supported equally. You have still people who do surgery and there are still people who do calculations and etc. But they also do dis-empowering tasks. And they do a mix. And the mix is such for each person. We all from our work are comparably empowered. So that means we are all going to participate rather than some of us being exhausted, dead, having no information, no knowledge, nothing to bring to the table and others doing all the deciding. So that is balanced job complexes. Finally, get rid of markets and central planning. And the reason why you have to get rid of those without going to long is that their structures and their implications that is built into the dynamics of markets and central planning are working precisely the way they are supposed to work. They are not corrupted, not taken over by a bad person but doing what they are structurally inclined to do. They are horrifically destructive. They destroy self-management, they destroy justice, they destroy equity and so on and so forth. They destroy all these values that we are inspired to. So participatory economics comes up with something like participatory planning. The idea is that the workers and consumers councils cooperatively negotiating they engage in a process with each other that arrives at inputs and outputs. Central planning arrives at inputs and outputs by way of command, reaction, command, obedience. Markets arrive at it by the way of competition that is very screwed to the powerful. Participatory planning arrives at it, the final results, what is going to get out of the economy, what is produced here what is consumed there by a way of negotiation among the actors. It is consistent with self-management, it is consistent with the other institutions. So that is it: Just workers and consumers self-managing councils, equitable enumeration for the ratio of intensity and onerousness of socially valued labor, balanced job complexes and participatory planning. Beyond that everything else varies from place to place, from time to time and country to country. Even the implementation of those four will take on various different attributes but the basics of those four I think will be the same in participatory economy. And this is what will allow and indeed propel that economy of being classless and to being equitable and treating people like people instead of means to the end of the empowerment and the enrichment of the few. So that is participatory economics as an alternative.