Markets#2

Robert Peter Burns rburns at chaph.usc.edu
Tue Nov 14 23:23:57 MST 1995


 Okay, here's something better--more efficient and feasible
 than a totally planned economy, more likely to gain and
 retain the support of the working class, and yet something
 that still requires a lot of class struggle to achieve.
 
 We need to distinguish "market forces"--the atomistic,
 anarchic determination of investment and the structure
 of production, on the one hand, from "market exchanges"
 on the other--the use of flexible, non-centrally determined
 money prices as a mechanism of distribution of a range of
 goods and services, and as a source of information about
 costs and demand.  Socialism requires the abolition of
 the former but can coexist with the latter.  My position
 would be, therefore:
 
 1.  There should be planning of the aggregate level and
     composition of *investment* by democratically accountable
     public agencies, with the aim of ensuring full employment
     and adequate productivity and infrastructure improvements
      
 2.  There should be a large nonmarket based public sector
     for education, health care, social services, parks
     and other leisure facilities, libraries, public transport,
     etc., and an income-support system to ensure decent nutrition,
     housing, etc for all those unable to support themselves 
     through employment, as well as a decent minimum income for
     those who do.

 3.  Major industries in the transportation, energy, and
     telecommunications sectors should be publicly owned.
     Individual enterprises in other sectors should be worker 
     self-managed but "socially" owned, with ownership rights disaggregated 
     and distributed between the workers, democratically
     accountable investment agencies, and local, state, and federal
     government.  Small private cooperatives and self-employment 
     should also be permitted.
 
 4.  Where it operates, the market should be held in check by 
     regulation covering matters like workplace health and safety, 
     product safety,and environmental protection, and by a progressive 
     taxation system to finance the nonmarket sectors of the economy.
 
 In this system, enterprises would have to produce and price their
 products within the parameters laid down by the aggregate and 
 sectoral investment plans.  Though plan and market would check and
 balance each other, politics would definitely be in command through
 public control over investment and regulation of production units, and the
 the counterweight of the tax-financed nonmarket public sectors.
 Democratically accountable investment agencies would monitor firms
 and appraise individual investments not simply on the basis of
 enterprise profitability, but using "social return" criteria to take
 care of major externalities <e.g. pollution>, monopoly power, and 
 community and local needs.  Investment and production would not be 
 determined atomistically, but in a conscious coordinated way.  But once the
 plans had been set, enterprises would not be under centralized 
 operational management, but would respond autonomously to the 
 pattern of demand that resulted from the plan, with those responding
 effectively having some financial incentive to do so.  But the 
 tax and public provision system would act as a powerful redistributive
 mechanism to offset large inequalities.  And in any case there would
 be no income merely from owning private capital, so that would lessen
 inequalities in the first place.  Imagine Swedish social
 democracy transformed into socialism by adding investment planning,
 social ownership, workers' self-management, instead of it being 
 thrown to the dogs of global capitalism.  Wouldn't that be worth
 fighting for?  Wouldn't that be attractive to workers?
 
 For how a model like this would work, and its many advantages over
 both capitalism and total central planning, see D. Schweickart, 
 AGAINST CAPITALISM, Cambridge University Press, 1993.
 If this is *still* too market-oriented for you, then try P.
 Devine, DEMOCRACY AND ECONOMIC PLANNING, Polity Press, 1988

 Peter Burns SJ
 rburns at scf.usc.edu
 PS--the answer to the famine question from Markets#1 is:
 Mao's China <1959-1962--at least 20 million dead>
 PPS--Oh my God, I've just remembered I said I wouldn't
 post on market socialism again!  Will you forgive me?



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