Introduction to Parecon: The Basics of Participatory Economics

The following are installments for a column that ran in the Nashville Free Press in 2008. Participatory Economics, or Parecon for short, is an economic model developed by Michael Albert and Robin Hahnel as an alternative to capitalism. As I did not come up with this economic model, much was certainly borrowed from Albert and Hahnel for this column (some points and examples come directly from Albert). If you want to find out more about Parecon ahead of my pieces, you can visit the Z PARECON Page for books, articles, and presentations exploring all aspects of Participatory Economics.


Installment 1 of 13

Over the next several months, I will be offering pieces introducing readers of the Nashville Free Press to the basics of Participatory Economics. Participatory Economics, or Parecon for short, is an economic model developed by Michael Albert and Robin Hahnel as an alternative to capitalism.

Now before anyone starts rolling their eyes, please know that this is not some dressed up version of communism. As you will see in the coming pieces, Parecon rejects not only capitalism but market and centrally planned socialism. We reject not only greed and competition but offer an alternative to the traditional economic food chains that have ensured inequities throughout our world.

And probably just as important as what that alternative entails is the concept that an alternative even exists. Those protesting capitalism are all too familiar with smart-asses asking them, “Well, we know what you’re against, but what are you for?” And while the question itself is actually quite pertinent, I refer to it as a smart-ass question because normally when someone asks you this, they don’t expect an answer. Nor do they actually want an answer. The question is meant to drive home the point that it is futile to fight against the system when there is no alternative. The question is meant to open your eyes to the light and bring you home to the flock. Yes, back home where you belong in the Church of TINA, this almost religious faith that there is no alternative to capitalism. TINA - There Is No Alternative.

Made famous by the British Prime Minister Margaret Thatcher, TINA was already a widely shared belief in the Western world. Yet by the end of the Cold War, TINA had become the gospel. There Is No Alternative. An assumption so prevalent, that even those railing against the ills of capitalism are too often convinced that the only choice they have is to try and reform capitalism, to nurture a gentler, more cuddly and adorable capitalism.

Well, advocates of Parecon see things differently. Accordingly, my pieces over the next few months will be about a rejection of TINA, a rejection to the assumption that there is no alternative. And not only do we believe Participatory Economics is an alternative, we believe it is a far better one.

As I did not come up with this economic model, I will certainly be borrowing much from Albert and Hahnel. My writing style will be simple. My language will be conversational. And hopefully by the end of these pieces, I will have aroused enough interest to spur your own investigation into Parecon (or, at very least, to more critically examine capitalism and our potential alternatives).

If you want to find out more about Parecon ahead of my pieces, you can visit the Z PARECON Page for books, articles, and presentations exploring all aspects of Participatory Economics. If you have specific Parecon questions (or challenges) for me, you are welcome to submit them at, and hopefully I can address a good number of these publicly in columns after the conclusion of this series.

I would like to thank the Nashville Free Press for this opportunity and thank you in advance for your time and attention. More to come…


Installment 2 of 13

Now before we dive into the nuts and bolts of economic theory, it’s important that I say a few words to make sure that everyone is in the right frame of mind for such a discussion.

For one, I’m not here to bash capitalism. My job is to tell you why I think Participatory Economics is better. I will surely discuss what I think is wrong with capitalism, but I will focus most of my time on what I think is right with Parecon.

And even more than that, I will try to demonstrate that you don’t have to be anti-capitalist to be attracted to what Participatory Economics has to offer.

See, you could be pro-internal combustion engine and still support the quest for a better model of automobile engine. You could think that the internal combustion engine is the single greatest invention in the history of the world but, for the love of progress, still desire improvement in transportation. Likewise, you don’t have to be anti-capitalist to want something better, to simply desire a better model.

Now the problem we often start off with talking about Parecon is how much better. In other words, when we begin describing the benefits of a Participatory Economy to people for the first time, their reaction is often that it is too utopian. Some have a hard time even listening because they just don’t believe human nature would allow such.

Once again, we see the effects of TINA and how the proponents of capitalism use this concept of social Darwinism and human nature to tell us that there is no alternative. It’s just the way we are. It’s just the way it is. Some things just never change.

So before you find yourself yawning or rolling your eyes and thinking these types of thoughts, I want to give you a little different perspective to start out with.

For thousands of years, Egypt had slaves. As part of their culture, as part of their economy, as part of what they understood to be human nature, for thousands of years Egypt had slaves. Now that’s thousands of years where that didn’t change. So I want you to imagine going back a few thousand years ago and telling someone in Egypt that one day slavery will be seen as not only unacceptable but unnecessary. Imagine telling someone in ancient Egypt about our own economy today, about our social system.

Certainly they would think you’re crazy. And this of course is because they’re thinking under the assumptions of ancient Egypt. Well, it’s the same reason why many today have a hard time believing that Participatory Economics is possible.

People often say things like, “Yeah but people are just too greedy and selfish, too individualistic. Parecon just doesn’t jibe with human nature.” But, again, this is the same thing that could have been said in ancient Egypt.

Most people tend to believe that whatever system they are operating under is the only way. We tend to think within the assumptions of capitalism.

This concept of social Darwinism and dog-eat-dog, every-man-for-himself, free market competition is not human nature. It’s human nature under capitalism.

Think about it. You don’t have to go back to ancient Egypt. Just go back a couple hundred years ago in this country. Try telling someone back then that one day women would be allowed the vote and the same property rights as men. Try telling them about the eight hour work day and child labor laws. Try telling someone 40 years ago that a black man was going to be the President of the United States within their lifetime.

All these things would have sounded too utopian. The argument would have been that we’re just not capable of that. Some things just never change. They’re just human nature. It’s just the way it is.

Well, we know it’s not just human nature. We know we have more potential than that. And as you read my descriptions of the ins and outs of Parecon, I encourage you not to think within the assumptions of the present.

Try instead to think as if we’ve already achieved a Participatory Economy. Try to think like someone looking back on how years before everyone would have never believed possible the things that just seem natural today.

Not only will this help you take Parecon seriously, it may help make my presentation more exciting.

So, having said all that, let’s get to it. More to come…


Installment 3 of 13
An Economy is Nothing More than a Recipe

Because economics affects everyone, it should be understood by everyone. When, however, economics is too difficult for the average person to understand, it’s to keep decision-making power out of his or her hands.

Since that’s not my idea of a good economy, that’s not the way I plan to talk about economics. So for anyone who thinks, like I once did, that this will probably be too much to comprehend, you only need to know one thing. An economy is nothing more than a recipe. There’s what you put in, what you get out, and how you cook it.

What you put in is of course your main ingredients. And in an economy, the main ingredients are what we call institutions.

What you get out is how the dish is experienced (things like look, taste, smell, texture, whether it’s healthy, etc). In an economy, these desired experiences are simply the values we desire in our economic life.

How you cook it is what you do with your main ingredients to get to that desired experience. In an economy, it’s basically all the little details concerning how you run your economic institutions.

And just like we have basic food groups from which to choose our main ingredients, all economies boil down to how you answer a few basic questions. These questions are essentially: Who owns what? Who calls the shots? Who does this, who does that? Who gets this, who gets that? And how are prices and wages set?

As we know, what you choose from the basic food groups makes an enormous difference in what dish you end up with. In an economy, how you answer these basic questions can literally be the difference between life and death. So how do you decide?

Well, any good cook knows that if you’re creating a recipe from scratch, you don’t start at the beginning. You start at the end. You ask what it is you want out of the dish.

And in Participatory Economics, there are four basic values that we want to be experienced: equity, solidarity, self-management, and diversity.

Equity is simply fairness. It’s a fair norm or standard applied to all individuals, a fairness that doesn’t allow for unjust disparity in wealth, resources, or chances.

Solidarity is working together as part of a community rather than working against one another in the service of individual materialism and material disparity. It’s cooperation and civility rather than competition and selfishness. Solidarity is not getting yours at someone else’s expense, but rather standing up for the common good of all.

Self-management is the concept that no one individual or group should have undue power or control over your life. Instead, you have a certain degree of autonomy, a certain amount of say in society proportionate to how decisions affect you. In other words, self-management is real democracy.

Diversity is the idea that if everyone’s inputs are considered, rather than just the inputs of a few powerful individuals, not only will we have more choices, we’ll have better choices. Unleashing the imagination of more minds will enhance the arts and sciences. Greater debate and dissent will enhance democracy. In a world that values education over censorship and dialogue over dogma, our chances at a better quality of life are enhanced.

Equity, solidarity, self-management, and diversity. These are the values we want in a future economy. These are the experiences we desire from a better world. More to come…


Installment 4 of 13
Classlessness and Productive Property

When someone asks you what kind of meal you’re in the mood for, you don’t say “one that’s fried and heavy” or “one that’s light and healthy.” You say I’m in the mood for Mexican or Italian or Indian or whatever. These one-word descriptions sum up the basic experiences you’ll enjoy.

Likewise, instead of having to go into the four basic values of equity, solidarity, self-management, and diversity, you can simply tell someone that the goal of Participatory Economics is a classless economy – one that rejects the food chains of classism, racism, sexism, heterosexism, jingoism, and any other form of hierarchical division.

Now to get there, we must start answering our basic food group questions. The first of which is, “Who owns what?”

Capitalism is defined by how it answers this question. It’s kind of like the apples in an apple pie. And the apples in our capitalist apple pie is the concept of personally owning productive property.

So what do I mean by productive property?

First, I don’t mean private property, or property that you’ve worked to own and that fulfills your needs or personal satisfaction. Productive property is material used to either commercially produce or employ. From land and minerals to factories and machinery all the way to intellectual property and the patenting of life itself, the concept of owning productive property is the apple in the capitalist apple pie.

In contrast, within the Parecon recipe those apples don’t exist. This of course doesn’t mean that we do away with productive property. It just means that we can’t personally own it. It’s simply not an option in our economy.

To be sure, under our capitalist perspectives it’s hard to even understand the concept of not being able to own your own business. Entrepreneurship is the highest calling in capitalism. Capitalists will argue that the engine of ownership has allowed us to do a lot of good with productive property, to provide us with the things we need and want.

And, to a certain extent, they’re right. But what they don’t bring up is all the bad that comes along with that ownership. See, owning something is to have sole decision-making power over it, to decide how it will affect everyone else. So if you buy up the bulk of farmland in an area, you may use it to make sure that no one among you goes hungry. Or you may use a few hundred acres to produce a small amount of food and do nothing with the rest of the land, keeping prices high and people starving.

Whether or not landowners will do this is not the point. The point is that they have the power to do it, that they have this immense power over the lives of others. Wealthy landowners have the power to let people starve, just like insurance and pharmaceutical companies have the power to let people stay sick and die.

And why? Because they own the productive potential of their property. It doesn’t matter if it could benefit millions. It doesn’t matter if lives are in the balance. It doesn’t matter if your child’s life is in the balance. What matters is who owns what.

And in Participatory Economics, no one individual or group of individuals has that type of power. More to come…


Installment 5 of 13
Ingredient One: Worker and Consumer Councils

And voila, we just got rid of capitalism. Capitalists, by definition, are the owners of capital, the owners of productive property. If you eliminate the ownership of productive property, you eliminate capitalists. No more capitalists, no more capitalism.

This of course doesn’t mean that productive property goes to waste. Just because productive property can’t be personally owned doesn’t mean that we do nothing with it.

Productive property can still be used to provide the things we need and want. It’s just that the power to make those decisions is no longer a matter of who possesses a particular receipt, deed, or the right piece of paper. Instead, we allow for a more democratic decision-making process, one that upholds the values of equity, solidarity, self-management, and diversity.

In other words, we answer our next basic food group question: “Who calls the shots?” If there are no individual owners of productive property, then who calls the shots as it pertains to the use of productive property?

The answer to which is actually our first main ingredient, our first economic institution: Worker and Consumer Councils.

Instead of some grand food chain of money and power dictating the use of resources, Parecon allows ordinary people to deliberate in relatively small councils in order to decide what is best for their community. And unlike vertical power images like the corporate ladder, Parecon uses the horizontal image of nests.

Take Consumer Councils for example. Each Consumer Council is like a small nest made up of maybe 20 or so families. If you take that nest and put it with another twenty nests of the same size, you then have a neighborhood sized nest. Take twenty neighborhood sized nests, and you have a town sized nest. And so on and so on until your entire population is represented within these nested councils.

Now under the principles of equity and self-management, the amount one’s voice counts in decision-making is a matter of how the decision impacts that particular individual. So the only time a council decision goes outside your own nest is when it affects another nest. If your council wants to put a water fountain in your part of the neighborhood, there’s little reason why any other council should share in that decision. If, on the other hand, the chemical plant being built in one neighborhood is going to pollute the stream running through another neighborhood, that impact affords a higher level of input in the decision to build such a plant.

So instead of a vertical power structure where those with the most bargaining power call the shots, Parecon offers a more horizontal model of nested councils where decision-making power is based on solidarity and mutual respect.

The same goes for the workplace. Instead of decisions being handed down from above, workplaces and industries are ordered into nested councils so they can discuss, negotiate, and agree on how best to run operations. Now this doesn’t mean that every little decision calls for everyone’s attention or that no one has authority in whatever specialty he or she was hired on for. It just means that decision-making is not monopolized any more than it is deserved and that we all share equitably in the direction of our production.

Later on we’ll get more into Worker and Consumer Councils. What’s important right now is to understand what our first institution represents. This first main ingredient represents a rejection of hierarchy, a rejection that economies must be ordered into a food chain. In short, a rejection of class. More to come…


Installment 6 of 13
The Coordinator Class

Often after hearing that there’s no ownership of productive property, proponents of capitalism immediately argue that Participatory Economics is nothing more than regurgitated communism. The real point of which is to imply that because communism collapsed in the Soviet Union, there is no alternative.

That of course doesn’t work with our recipe. Our recipe is not just an alternative to capitalism. It’s a recipe for a classless economy. We refer to it as an alternative to capitalism because that’s the system we’re in, the system for which we’re told that there is no alternative. If we were living within a centrally planned economy in the Soviet Union, Parecon would still be a very different and desirable alternative.

In fact, while we do share a Marxist view that capitalists (owners of productive property) are indeed a particular class, our understanding of class probably pays more attention to that of capitalist political rhetoric.

While traditional Marxism spends great focus on owners and workers, or rather those at the top and those at the bottom, capitalists like to talk more about those in the middle. In fact, they almost exclusively talk about those in the middle.

Think about it. When was the last time you heard a major presidential candidate or an economist in the mainstream media talk at length about the working class? Almost never. The focus is always on the middle class.

Why? Because the middle are all that separates those at the top from those at the bottom. Those in the middle are responsible for keeping in line those at the bottom. They are responsible for enforcing orders and rules made by those at the top.

And this is not just the case in economics. You can see this in almost any hierarchical structure. It doesn’t matter if we’re talking about the economy, the military, the church, or the mafia. The food chain is virtually the same.

Take the military for example. In the military, we can see that class structure is more than just generals and the enlisted. It’s the officers who hold the food chain together in service to those above them. They are entrusted with keeping the system running, as well as keeping those below them in line. In return, they are afforded enough power and privilege to make it worth it.

In capitalist economy, those officers are the roughly 20 percent of wage workers who monopolize empowering work and its demand of more money, leaving the drudgery and disempowering work for less money to the other 80 percent.

Michael Albert and Robin Hahnel refer to this 20 percent as the coordinator class. Others prefer to call it the managerial class. Still others prefer to call it the boss class. And some people just call it the middle class.

But no matter what you call it, it must be acknowledged and rejected if we are ever to get to a classless society.

Breaking down hierarchy is not about persuading the generals to give different orders. Nor is it just to convince enlisted personnel to refuse orders. It’s about convincing officers to break the chain and walk away from the privilege of their rank.

Now, let me make this quite clear. We’re not saying that these economic officers, this class of coordinators, are bad or evil people. We’re just identifying class structure. If we intend to have a classless society, we must first identify what makes up class. More to come…


Installment 7 of 13
Ingredient Two: Balanced Job Complex

Anyone familiar with failed attempts at socialism knows that classism does not go away just because you eliminate private ownership of productive property. Sure, it may no longer be a Capitalist apple pie. But what about the crust and the filling? What about this coordinator class, this 20 percent of wage workers who run the show for those at the top? Because, whether it’s the state government at the top or the owners of capital at the top, the class itself is still the same. Those who get paid more for doing work that is more empowering and/or more desirable.

Luckily, our next two main ingredients address this middle coordinator class by answering the two basic food group questions that deal directly with work: “Who does what?” and “How are wages set?”

First take the question of “Who does what?” A lot of people associate class with money and power. But often class can be just as much a matter of who does what.

Capitalism tells us that line workers do the labor that supervisors are too important to do, secretaries do the administrative tasks that bosses are too important to do, and janitors do the cleaning the rest of the workers are too important to do. In other words, those higher in the food chain monopolize the more empowering and rewarding work, leaving the shit work to those below them. And usually as it goes down the chain, the tasks get more boring, repetitive, and physically taxing, as well do the working conditions become less comfortable and more dangerous.

And it’s not just about physical conditions. The monopoly of information is what allows this class of coordinators to call the shots and demand higher wages. In other words, the fewer people who understand the big picture, the more valuable those few people become.

So Participatory Economics answers the question “who does what” by asking, “Why not have a workplace that requires everyone to do a balanced mix of tasks, one that does not reproduce the corporate division of labor that is so crucial to class hierarchy?”

Michael Albert and Robin Hahnel describe this new main ingredient to our recipe as a Balanced Job Complex, meaning a balanced mix of tasks. I personally like to think of it as a “fairshare workload,” where you do your fair share of the empowering and rewarding work and your fair share of the mindless and less desirable work. The point, of course, is that at the end of the day everyone’s mix of tasks comes out to about the same balance or average.

Now many who currently hold more privileged positions in the workforce are disgusted with such an idea. But certainly those who clean our toilets and dig our ditches are not too low to use their minds more often. Likewise, doctors are not too good to empty bedpans, nor are lawyers too good to dirty their hands.

Of course, we’re not saying that those currently working as hospital janitors are going to start performing surgeries. We’re saying that, with proper education and training, there are enough tasks to be ranked and divided up among workers that there doesn’t have to be a huge disparity in the quality of our work lives.

Not only does this Balanced Job Complex, or this balanced mix of tasks, promise a higher degree of diversity in our daily lives, everyone doing their fair share moves us closer to equity and greater solidarity. More to come…


Installment 8 of 13
How not to get paid

Equity is not just about everyone doing his or her fair share. It’s also about everyone getting his or her fair share. So if the Balanced Job Complex is our institution to deal with “who does what,” we next have to ask, “How are wages set?”

In other words, what do we get paid? Just because we plan on having a more just economy doesn’t mean you’re not going to get paid. It doesn’t mean you’re not going to see reward for the fruits of your labor. It simply means we have a more just mechanism for getting paid. It means that how we get paid is in line with our values, specifically the value of equity.

Now, remember, equity is really about having a fair norm or standard. So how do we decide a fair norm or standard for getting paid?

Well, we could always take an ironic lesson from our libertarian friends. See, many proponents of the free market tell us that one’s fate is and should be all about the choices he or she makes. Of course the only way this would make sense in terms of being fair is if we were all at the same starting point. And to believe that we are all at the same starting point, you have to ignore our vast array of circumstances.

So I say we do just that. Let’s figure out an institution that doesn’t take into consideration the circumstances that make us different. Let’s figure out an institution instead that puts us all at the same starting point. In other words, let’s rule out what we don’t have control over and instead use what we do have control over. And then it really will be our choice that decides how much we are rewarded. Then how we get paid really will be fair.

The question we have to ask is, “What do we have control over and what don’t we have control over?” Take, for instance, the circumstance of one’s birth, something we obviously don’t have control over.

Under our current system, one’s birth counts big time in relation to where one ends up on the pay scale. With a history of discrimination, it counts in one’s gender, skin color, sexual orientation, and physical limitations. With a history of class division, it counts in the name, wealth, and network one is born into. With a history of domestic violence, it counts in how one is nurtured by his or her caregivers.

And that’s not all. The ownership of productive property also depends on one’s birth. Seeing that no one chooses the time or place of his or her birth, the property available to someone is also a matter of chance.

Even our beloved rule of competition depends heavily on the circumstances of one’s birth. From talent and genetics to the schools and tools one has had available to them, competition often relies on this, our first circumstance.

It’s not hard to imagine how different our lives might be if our circumstances were the opposite. It’s not hard to believe that circumstances beyond your control could put you in an entirely different job, getting paid an entirely different wage.

So what do we have control over? What is a fair norm for remuneration? What is a fair standard for getting paid? More to come…


Installment 9 of 13
Ingredient Three: Reward for Effort and Sacrifice

So what do we have control over? What is a fair norm for remuneration? What is a fair standard for getting paid?

Well, it’s literally the work you are willing to do. Or rather the effort and sacrifice you are willing to let go. And though that may sound a bit simple, that’s actually our next main ingredient: Remuneration for Effort and Sacrifice in Socially Valued Labor. Or, for short, Reward for Effort and Sacrifice. An institution that says what you give of yourself is what you get in return.

To both understand and embrace this, it’s important for us to rethink the way we look at our pay. We have to quit thinking of wages in terms of just cash, and start thinking of such as a claim on a certain amount of what society produces. The idea being that your claim on social output should be equal to your personal input.

By this, we don’t mean input compared to that of another. Getting paid based on competition is partly getting paid according to the work someone else does. You do not, however, have control over the work someone else does. Nor do you have control over someone else’s gifts and background, some of which may offer unfair advantage in performance, all of which competition rewards for. In Parecon, you’re measured not against another’s potential but against your own.

And when we talk about potential, we’re not talking about your job getting as much out of you as possible. Instead, we’re talking about you sacrificing according to how much you want out of the pie. If you really want more stuff, you can work harder and longer for it, or rather you can sacrifice more for it. On the other hand, if you don’t really care as much about material goods and what you really value is more free time, then you can opt to work less. Remember, it’s about choice. You work to the level of what you want out, and that’s it.

I agree that where we end up should be a matter of choice and not circumstance. That’s why in Parecon we give folks (including our libertarian friends) what they claim to want. We create an institution that doesn’t reward for circumstances beyond your control, but rather only for choice. By rewarding for effort and sacrifice, we are all put at the same starting point.

Unlike capitalists, you’re rewarded for the work you do, not the work you own. Unlike in a competition, you get paid according to your individual effort and sacrifice, not how your work matches up to that of someone else. Unlike in a market system, the fruit of your labor is your own and not up for bid. We all have the same chance at getting what we want. We all get exactly what we deserve.

Admittedly, this is not as easy as I’m making it sound. The most obvious problem is how to measure for effort and sacrifice. But this is where the cooking comes in. Since there is no magic textbook for new institutions, in the beginning some of this will be a matter of trial and error.

From peer review and gauging performance over time to scientific methods and the honor system, as time goes by we’ll get a better feel for what works and what doesn’t. Moreover, without the selfishness of competition, we’d have incentive to share our discoveries and could benefit from the diversity of experiments throughout the workforce. More to come…


Installment 10 of 13
Ingredient Four: Part One of Participatory Planning

Having already asked who owns what, who calls the shots, who does this and that, and how wages are set, there are only two basic food group questions left. There’s “who gets this and who gets that,” and there’s “how prices are set.”

Both of which are answered in our next main ingredient: Participatory Planning.

Now, in economic terms these two questions address what we call allocation. And in a capitalist economy, allocation is left to the institution of the market.

And what is the market? Well, it’s basically a competition for resources. It’s a competition in which the ins and outs of our work and consumption are decided by who has the most juice. That’s right. It’s all about bargaining power. And often enough, bargaining power boils down to who has the biggest gun or biggest checkbook.

You’ve heard the saying, “Let the market sort it out.” Well, that’s exactly what that means. In a system where the only rule of fairness is whatever you can legally get away with, there is no justice other than bargaining power.

Forget about the powerless and poor, those whose stake was just enough to make them losers.  Forget about innocent bystanders, those unfortunate souls outside the market transaction that might be ill-affected by the outcome. Forget about the real potential of our economy, what could actually be done with these same resources. Forget about our most basic principles of democracy.

For that matter, forget about morality. In the real world of capitalism, there is only one religion. And that’s the market. There is only one commandment. And that’s profit. Concepts like equity, solidarity, self-management, and diversity are not welcome in such a church.

So what’s our alternative? Many assume that we’re looking toward a centrally planned economy like in the Soviet Union. But we’re not. Remember, we’re looking to avoid the food chain. We’re looking to avoid a class of coordinators. We’re looking to avoid ill-effects felt by those not privileged enough to be in the decision-making process.

Instead of institutions that embrace top-down vertical power, Participatory Economics opts for a system of horizontal power where each person or group has a say proportionate to how the decision affects them.  Through the institution of Participatory Planning, we allow nested Worker and Consumer Councils to cooperate and negotiate the best use for resources. More to come…


Installment 11 of 13
Ingredient Four: Part Two of Participatory Planning

Instead of institutions that embrace top-down vertical power, Participatory Economics opts for a system of horizontal power where each person or group has a say proportionate to how the decision affects them.  Through the institution of Participatory Planning, we allow nested Worker and Consumer Councils to cooperate and negotiate the best use for resources.

And how is this done? Well, it’s done in rounds of planning. The first of which, we’ll call the wish list. Every year, each individual would look at information from the year before (things like how much they consumed, how much they worked, prices, etc.) and turn in a proposal for the next year projecting their consumption in relation to the amount of work he or she wants to do. Additionally, each Consumer Council would submit a proposal for collective council requests, as would Worker Councils have a wish list for workplace upgrades and projected output for the year.

Then through what we call facilitation boards, this first draft of proposals would make its way to all parties involved. Obviously, orders for basketballs would be checked with the plant that makes basketballs, orders for guitars would be checked with the plant that makes guitars, and so on. But that’s not the only place the information ends up.

In a Parecon, everyone has a say to the degree to which decisions affect them. So if an item of consumption is going to pollute a certain residential area, then the residents of that area deserve an input. Such input could range anywhere from smaller councils directly affected by pollution to agencies that represent the greater public in relation to climate change all the way to specialists on particular plants and wildlife.

Consequently, if cars are polluting and less energy efficient, it would reflect in higher prices. If trains and buses would lessen pollution and energy worries, this would reflect in their prices as well.

The point is that consumption in a Participatory Economy will not be just a matter of one’s own self-interest. It will be a matter of equity and solidarity. When our choices impact the lives of others, we should expect and respect the input of others in such decision-making.

So when all affected parties are given equitable consideration or input, new prices can then be generated to reflect the overall impact on society. These new prices are then distributed throughout the councils, so new proposals can be revised in accordance with the new information. This process repeats itself until such budgeted wish lists are acceptable to all parties involved and prices are set for the year.

Unlike in a capitalist market, transparency provides us not only with justification of pricing, but consumers are provided information to better grasp the consequence of their consumption. Each consumer has access to a database that lists not only the descriptions of individual products, but the social costs and effects of those products.

Of course, Participatory Economics is a matter of vision. The cooking will require experimentation and critical assessment. As each year goes by, our wish lists will become easier to project and the process of participatory planning will become more efficient.

And guess what? That’s it. That’s the last of our institutions. We’ve asked all the basic food group questions and answered with ingredients that produce the values we desire. More to come…


Installment 12 of 13
The Implied Value of Effeciency

Let’s take a quick review. We answered the question of “who owns what” with the absence of private ownership as it pertains to productive property. Leaving the question of “who calls the shots,” which we answered with our first institution of Worker and Consumer Councils. To the question of “who does what,” we answered with the institution of a Balanced Job Complex, or a balanced mix of tasks at work. To the question of wages, we answered with the institution of Reward for Effort and Sacrifice. And to the final questions of who gets what and at what price, we answered with the institution of Participatory Planning.

These four institutions (Worker and Consumer Councils, Balanced Job Complex, Remuneration for Effort and Sacrifice, and Participatory Planning) are the main ingredients of our Parecon recipe. And we believe with the right cooking, they will produce the four values of equity, solidarity, self-management, and diversity.

Now before we end, I’d like to cover one more aspect of what we want out of any economy. Just like the absence of ownership of productive property is kind of a hidden institution, there is another kind of assumed value we want from our economy. And that’s efficiency.

And by efficiency, we mean achieving the most while wasting the least. It’s about getting what we want without losing what we love, accomplishing our goals without moral defeat.

Now just in terms of resources, I want you to imagine if we did away with advertising, profits, and useless junk. This by itself would account for trillions and trillions worth of money and work. Additionally, we would be saving all that time and talent (not to mention the earth) so it could then be focused on products and services we really do need and want.

Instead of an economy that’s required to be constantly growing, we could have an economy that was actually sustainable. Instead of discovery and inventiveness going to enrich a relative few, it would benefit everyone in society equally. This means that research and development would be based first on need and never on greed. Furthermore, our best minds wouldn’t be wasted making their masters more money, but making our quality of life better.

Pharmaceutical science would tackle our world’s greatest threats instead of bullshit like restless leg syndrome. Agriculture would be geared toward ending hunger, rather than pitting one hungry population against another hungry population. Cutting edge technology would be used for the advancement of peace rather than figuring out better weapons and ways to destroy our fellow human beings.

Moreover, there would be no capitalist culture of consumption luring us into debt and encouraging us to be personally wasteful. In a Participatory Economy, the only profit being sought is that of social good. All the resources that are saved can be focused on things that really do help us like education, healthcare, and infrastructure.

Now some might ask, “What about work? How is work more efficient?”

Well, for starters, efficiency would mean full employment in a system where advancements are transparent and benefit not just a particular company’s workforce but all workforces. If a manufacturing plant figures out a method to automate production lines in a way that would put ten thousand workers out of a job, those ten thousand workers would simply be trained and placed elsewhere in the workforce.

With more people now doing, or rather sharing, the same amount of work, there’d be less work overall for everyone to do. And that of course means more free time. More to come…


Installment 13 of 13
Vision of Efficiency / Conclusion

We can imagine that, when efficiency is at its highest, you might find yourself working only 15 or 20 hours a week. Who knows, maybe less. This of course means more time to enjoy your life. More time for hobbies. More time to exercise and play sports. More time to enjoy music, movies, and art. More time to visit with your family and friends. More time for love and sex.

In an economy that promotes equity rather than disparity, we could eliminate poverty and in turn the majority of crime. This would mean less resources for prisons and more resources for schools.

And speaking of schools, in our current capitalist culture, education is geared toward meeting the labor demands of corporate bosses. Most are educated to find individuality in their consumption and material wealth. Most are educated to find patriotism in militarism and unquestioning loyalty to those above them. Most are educated to find achievement in memorization instead of questioning. Most are educated not for creativity but for standardized testing.

In other words, education is currently set up to prepare people for the particular class they will occupy in the workforce. There are a select few who are readied for positions of leadership, while most are educated to take orders and endure boring, mind-numbing, and sometimes degrading and debilitating work.

Now, for a profit driven food chain, this may be quite efficient. Yet such definition of efficiency reveals what values capitalism desires.

Participatory Economics has different values. And education in a Participatory Economy would focus on developing individual talents and interests, rather than directing skills to fulfill the wishes of corporate industry. Moreover, education in a Participatory Economy would be structured to ensure and reproduce our values and a definition of efficiency that is not just about preserving resources, but preserving our humanity.

My wife told me a story a while back about visiting a friend of hers in Japan. After seeing that her family had this vast array of recycling containers and recycled almost everything, my wife said, “This is great, but surely your family is the exception to the rule. Certainly, no one else is doing all this.” To which, her friend didn’t understand what she was even saying. She simply replied, “Why wouldn’t they do it?” To her, it was not only common decency. It was common sense.

See, many of us might find ourselves skeptical of Participatory Economics because our economy encourages wastefulness and selfishness. It encourages competition, hierarchy, and conformity. If, on the other hand, we were brought up to embrace values like equity, solidarity, self-management, and diversity, such institutions would seem normal and a matter of common sense.

By embracing institutions that nurture such values, we believe that these values will spread throughout society and become part of the overall culture. Then not only would we have a more desirable economy, we would have a more desirable world. More to come…


Note: As I wrote this a few years ago, I have since expanded my understanding of parecon and have discovered other economic experiments/movements that fall in line with its values. Having written about one such movement, I urge you to check out my song on Open Source Ecology.