what about inequalities between firms (market socialism)

Justin Schwartz jschwart at freenet.columbus.oh.us
Thu Nov 3 22:18:15 MST 1994


On Thu, 3 Nov 1994 tgs at cunyvms1.gc.cuny.edu wrote:

> It strikes me that I've left Justin off the hook by simply discussing
> intra-firm inequality.  What about inter-firm?  Isn't there objective
> evidence from Barcelona in the 30's that producer capitalism led to growing
> inequalities between firms?

I do not know this evidence. I do not understand, either, the concept of
capitalism without capitalists. I presume by "producer capitalism" you
mean cooperative production in a market. Let's call it cooperative
production, or I'll get nasty and start calling democratic planning
"Stalinism with a human face." But the point is well taken. Markets
produce winners and losers and there would be inequalities among firms.

  If Justin is saying that the profit motive
> acts as a whip to spur satisfaction of demand, is not the threat posed
> losing out to one's competitors in the great rat race?  And as Louis
> has said, what happens to the workers, do they get pink slips for making
> the wrong decisions?

Yes. They aren't fired, since they're their own bosses, but if they're not
making money, they will want to either reorganize or do something else. I
take it that this is supposed to be a reductio. I don't get it. Do you
mean that under Stalinism With a Human Face, oops, I mean democratic
planning, that inefficient and unsuccessful production units will just be
carried by everyone else? Why isn't that waste and exploitation?

>
> Now i hear Justin rolling his eyes and saying, "But the state can take
> care of that!"

You are worried, as well you should be, about what happens to workers in
firms which close down (go bankrupt, whatever). Here is a range of
possibilities. (1) They go to more successful coops and become cooperators
there. (2) They get together, either among themselves or with others, and
start new cooperatives in the usual way (draw up a business plan, get a
grant from the state bank, go to work). (3) They get a job in a state firm
or a government enterprise--this is a measure of last resort. (4) As a
measure of last last resort, they go on the dole. So, what's the problem?

 But my whole point has been, besides the problem with
> the commodificatin of labor and the fallling rate of profit, which are killers
> in and of themselves, that the state is corrupted by the inequalities produced
> by the market.

This is a problem. Better off firms will lobby on their own behalf. Though
I don't see how it is problem with regard to unemployment. Unlike in
capitalism, where there's structural pressure to create high unemployment
to keep down wages, in market socialism there is none. No one wants low
profit shares (the analog to wages) and no one benefits by unemployment.
So any undue influence of better off firms in the market will not tend to
create structural unemployment.

Labor is not commodified under the version of market socialism I advocate.
In the strong version of the model, it is illegal to buy or sell labor
power, capiche?

Besides--I'm getting tired of being ignored here--the issue is
comparative. You want corruption, look at a planned economy. Oops, I'm
sorry. You hit it with the democracy stick and that fixes everything.
Democracies are never corrupt.

  This is why even Rousseau, the founder of all this bunk about
> how the political will can stand up to the evils of private property, insisted
> that in his ideal state THERE MUST BE AS LITTLE COMMERCE AS POSSIBLE AMONG
> WELL-NIGH INDEPENDENT, SELF-SUFFICIENT FARMERS.

Rousseau is not naive in the way you make out.

>
> Who regulates the regulator, when the regulators see their main chance in allowing
> themselves to be paid off by the wealthiest worker-controlled firms? The
> all-beneficient state, Justin, is no more to be trusted than the wondrously
> labor-commodified and profit-declining market.

Well, hit it with the democracy stick. WE regulate the regulators. Got a
better idea?

When will you start defending your proposed model? Listen to me Tom. No
one but me and the converted are listening to you. Nobody in the real
world, least of all workers, believe in a planned economy. What are you
going to do to change their minds?

--Justin Schwartz


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