Episode 253 is our third and last in a sequence addressing allocation after markets. With the basics of participatory planning in hand, we consider how to deal with collective goods, externalities, allotting income, and undertaking investments.
Episode 253 is our third and last in a sequence addressing allocation after markets. With the basics of participatory planning in hand, we consider how to deal with collective goods, externalities, allotting income, and undertaking investments.
Hello, my name is Michael Albert and I am the host of the podcast that's titled Revolution Z. This episode will perhaps be the 253rd without a break. If so, it will continue a sequence that is presenting chapters from the book no Bosses, written very carefully a couple of years ago, including that I intermittently, spontaneously comment on the material. Now, two years later why only perhaps? Well, as I sit here at my desk getting ready to record, I feel like, really, as holy hell rolls on and threatens much worse to possibly come in the Middle East, as just a little less cacophonous, as business as usual rolls on and threatens ecological catastrophe everywhere, I am going to spend an hour or so talking about the more complex elements of the most complex part of a vision for a better economy that, most doubt, is even possible, much less attainable. Am I up a rabbit hole? Am I doing today what I have done before mainly because I have done it before, by habit, say, or by blind persistence? I can only offer this by way of explanation. It seems to me that if thoughts of fears of or even essential constructive attention to horrors unfolding all around totally trump attention to what we really want, we lose. If images of bombs dropping bellies, distending lights out and hard rain falling blot out images of good day sunshine. We lose, and yet I admit or report it is a hard thing to keep in mind and not forget. So we are today going to complete chapter 7, titled who Allocates what, which presents participatory planning in the book called no Bosses.
Speaker 1:This chapter of the book is seriously long, which explains my having divided it into three episodes. The chapter is a whole, and thus the three allocation episodes taken as a set, presents and discusses participatory planning by way of a sequence of takes I called them and then takes it a step further. Of course, the prior two allocation episodes are available, as are the prior pieces relating to no Bosses, as are 250 other episodes, the overwhelming bulk of which are not time-bound but general and still as relevant as when first generated. So I hope you will consider them to be a library of resources that you can access anytime. You can do that via our Patreon site at wwwpatreoncom. Slash revolutionz or via Znet's RevolutionZ archive page at znetworkorg slash revolutionz, dash 2. While there, you might also consider making a donation. You can also find relevant links on the top page of znetorg.
Speaker 1:At any rate, here is the third and last episode based on the participatory planning chapter of no Bosses. I should say, even in the best of times, allocation is not an easy topic, even taking a step at a time, as in the chapter. But if you were jumping in without the prior two episodes while that's possible it may be still more difficult. In any case, this time we first go just a bit more into the processes already presented of how workers and consumers and their councils make proposals for their production and consumption and then, upon receiving new information, including adapted indicative prices where indicative prices are basically just new guesses as to final valuations, which are themselves based on tallies of all such proposals, will wind up. They adapt their proposals and then do so again in a series of planning iterations until they settle on a plan and associated final valuations. And so here goes.
Speaker 1:Realistically, arriving at prices in light of stated preferences to balance supply and demand is typically more complicated in practice than in economist's theoretical models. A product in excess demand in one planning iteration could, for example, overshoot equilibrium into excess supply, as workers offer to produce more and consumers offer to request less to respond responsibly to prior indicative prices. Likewise, since each product's status affects many others, progress in one industry could disrupt equilibrium in another, to make the participatory planning procedure converge at an acceptable rate. Therefore, it may be agreed that specific economies will incorporate flexible rules that facilitate convergence within a reasonable time but do not unduly bias outcomes or subvert self-management or equity. I comment this reveals, as indicate various other times, a methodology I suppose one might say. We have aspirations and aims. We conceive institutions to facilitate all of them, not just a few oblivious to the rest. We assess what we have conceived and, if need be, we make corrections. The text continues Procedures with this purpose.
Speaker 1:Aiding planning resolving into outcomes might change from simple formulas carried out by computer that seek shortcuts toward convergence to adjustments fashioned and implemented by assigned workers who are experienced in facilitating convergence when particular situations arise. Devising and choosing from among such experience-informed possibilities may become a practical issue in implementing any actual participatory economy, or perhaps such procedures will prove unnecessary due to the bear process itself easily converging. Considerations that a choice between contending convergence-aiding procedures might involve include, for example one, the extent to which iteration workers could accidentally or intentionally bias outcomes. Two, the extent of reductions in the number of iterations required to reach a plan or ease of conducting each iteration and ensuing time savings. Three, the amount of planning time saved through compartmentalizing subsets of iterations with special simplifying procedures. And four, how much more or less onerous to producers and consumers their calculations become with different options in place.
Speaker 1:One thing to make clear about participatory planning and participatory economics in general is, as I have often emphasized, that there is not likely to be a single right answer to how to accomplish all of its various functions. As with capitalism and all other social arrangements, within a participatory economy too, different approaches to problems may be taken in different parts of the economy and in different institutions, and even at different times. Different approaches could exist, for example, for measuring labor intensity or onerousness, or for balancing job complexes in or across units, or for organizing council decision deliberations or tallying procedures regarding participation and apportionment of influence in different industries and workplaces. There could be differences as well regarding handling social consumption and among different instances of the latter, or regarding means of determining proper accounting of externalities, or means for determining income allocation to industries and workplaces, or for facilitating planning convergence while simultaneously promoting empathy, preserving social transparency and encouraging participation. The point is that an economy is a participatory economy insofar as it implements the essential features of a productive commons council organization, self-managed decision making, classless job definition, equitable remuneration and participatory allocation. And insofar as it prioritizes the values of self-management, equity, solidarity, diversity, sustainability and classlessness to guide choices, among more detailed features that fill out the essential visionary scaffold into a full-fledged practical economic reality. I comment In the text there is now a heading Participatory Planning, take 9, some Additional Features, and the chapter continues the above discussion, meaning the prior allocation episodes, and this one so far focuses on individuals and consumer councils making consumption proposals and on workers and workplace councils making production proposals.
Speaker 1:It explains how proposals for what produces wish to supply and for what consumers wish to demand are conveyed and contrasted and how, in light of distributed information, individuals and councils alter their proposals until a plan is reached. Embedded in the logic is how collective consumption and other complexities as well are handled. But even for this all too long chapter, though all too short presentation of participatory planning, we should perhaps further clarify some issues regarding collective consumption, externalities, income via allocation and investment procedures. So first consider collective consumption and externalities. I comment Collective consumption just means when a group, not an individual, requests something from the social product. Externalities are implications of transactions, production or consumption that impact people beyond the immediate producers or consumers. The chapter continues Suppose your neighborhood would like a new swimming pool, your town wants to expand its public park or your state wants to overhaul its public transport system.
Speaker 1:One way to approach collective goods of these sorts is for consumer councils to propose any or all of these as part of their consumption proposals. Here are two aspects to consider. First, if the collective consumption is to occur, it of course has implications for what must be produced. This is no different than what holds for private consumption requests. Second, these types of collective goods are still ultimately consumer goods that benefit people, and they must be both charged to consumer budgets and considered for their impact on everyone they would affect. At first glance, there would seem to be no new issues.
Speaker 1:A neighborhood council discusses the matter and decides to ask for a pool. How do the neighborhood's members register the desire and collectively decide to make the proposal? Via self-management, of course. If the proposal goes through, people in the neighborhood will be charged on their consumption budgets their fair share of the indicative price, which price in turn may alter somewhat during the plan's iterations If the cost to be charged is too high, that is, if the neighborhood residents feel they will have to give up too much of their personal consumption allotments to have the collective pool, the neighborhood cancels the request.
Speaker 1:If, given their desire for the pool, the amount they have to pay from their budgets to get the pools acceptable, the neighborhood persists in its request, some problems arise. Larry and Lance both live in the neighborhood. Larry is going to swim but Lance is not. Are they both charged to share, or only Larry? Or suppose the pool will be used and enjoyed by folks in the surrounding towns as well? Larry and Lance's neighborhood may have proposed the pool, but if it is going to be built, shouldn't all those benefiting bear some of the cost? And what if the reverse is the case? What if the pool's effect on water delivery will adversely affect the neighborhood next door? How do people suffering repercussions from the decision to have a pool influence the decision to propose the pool? To the planning process of a council they are not even in. I comment. I hope you can see that I am perhaps unwisely opening two issues at once the collective nature and the external implications. The text continues.
Speaker 1:Consider a somewhat similar problem on a much larger scale how to deal with pollution. Suppose Michigan citizens, through their councils and after due deliberations, decide to collectively request a hydroelectric dam to replace a horribly polluting series of coal-based electric generators. How do the people of Michigan decide to request this in the planning process? More, how is the dam's cost to be allocated against the consumption budgets of the people of Michigan? Do the asthmatic citizens who suffer hugely from coal-generated pollution pay more than the folks less bothered by that pollution More? It turns out that the pollution from the coal plants afflicted Chicago and, to a lesser extent, other cities in Illinois. Shouldn't those citizens who will also benefit bear some of the costs of the new dam? And if so, how does that come about? To what degree do they pay and what impact do they have on deliberations? Or suppose the reverse is the case? The Michiganites are proposing some mass project which will not benefit but will instead adversely affect people in Illinois? Say, with new pollution Again, how do the citizens of Illinois have their appropriate impact? Even more complicated Suppose the rest of the country enjoys clean air. Is there an equity issue? Why should Michiganers, even if they are most affected, foot the bill if in fact they were enduring worse than average air conditions in the first place?
Speaker 1:Can participatory economic answers to these queries be rooted in the logic of self-managing, council-based organization and participatory planning, each understood as social deliberative processes. First, unlike with markets, we want decisions about goods to account for their full personal, social and ecological costs and benefits. We want the final price of goods to reflect all their effects as best we are able to make that happen. One likely possibility if a firm produces pollution, the planning process considers the pollution a product. However, unlike most products, it registers as a cost. Thus the victims of the pollution establish a price for each unit of pollution. If the production is agreed to go ahead, the firm is charged for the total pollution. The residents who endure the pollution are reimbursed.
Speaker 1:Second, we want all people affected to proportionately influenced decisions. When a proposal affects large numbers of people, it is not just that we want the initially formulated proposal decided on properly, we also want the system to facilitate the proposal's improvement. If a proposal has negative external effects, in addition to properly accounting for them if they persist, we want means to first try to amend the proposal to reduce those effects or even completely offset their impact. And also, the participatory planning process should not only promote that all those affected decide on collective proposals and likewise that all those affected determine the cost of externalities, for example pollution, but that all those affected be able to amend and otherwise improve the relevant proposals. When my neighborhood requests a pool or Michigan requests a dam, very likely the people involved do not have at their disposal the full awareness and insights of people in other neighborhoods or states. We do not want to incorporate only the decision influence of those other people but at least in some cases also their ideas and ingenuity. I comment Again the text is trying to address the economic vision issues, but I had in mind for it to also reveal the kind of thinking, guided by agreed values, that should be at work. The text proceeds To these ends.
Speaker 1:In participatory planning, one possibility is that when the residents of a smaller council propose some desire to collective consumption, a pool or a changed energy delivery system or whatever, the proposal has to not only gain support in their own council but must also be delivered to more encompassing councils above. So a proposal may go from a neighborhood up to a town and then to a city, a county and so on, and likewise it may go from a state to a region and onto a country If a pool is proposed by my neighborhood or a new dam in my state and if there will be beneficiaries beyond the area of the proposing council, then in passing up the proposal, its advocates are looking for it to become a proposal of the higher level council, with the hope that all who benefit at that next higher level will also be charged for its consumption, rather than only a subset in the smaller proposing council paying the whole cost. If we have a proposal, in contrast, which has negative impact beyond our own council citizens, then after passing it up, broader constituencies will presumably indicate their displeasure and establish a price, fee that is a price the producer has to pay adding to their immediate cost of production, and a fee that they who breathe the pollution have to be compensated. In this case too, perhaps the proposal is taken over by the higher level counsel, but this time it is likely adapted through deliberations to rectify or otherwise account for its broader negative impacts. The point is that, regardless of where proposals originate, collective goods consumption proposals could sensibly eventually be sponsored at the level where they have their overwhelming proportion of impact and at that level could be massaged and refined before acceptance With that approach. Only then would the proposal be put to producers and other consumers.
Speaker 1:What about the apportionment of influence over these decisions and payment for these items. In the absolute ideal case, each individual is going to influence a choice in proportion to the extent it affects him or her. Likewise, each is going to carry a share of the costs proportionate to the extent that he or she benefits. Members of a council make decisions by means that involve both information transfer about the decisions properties and about people's reactions to it, as well as deliberations over possible refinements, all via some agreed set of deliberations and then voting procedures. Participatory economic principles say. We are to choose all these mechanisms to try to make most likely an outcome that accounts for all relevant information and effects, that is appropriately influenced by all concerned and that takes time and energy commensurate to what is at stake, but not more. I comment as at every stage the text is setting out the logic and even the kinds of evaluations to arrive at practical results, not dictating what those results must always be.
Speaker 1:The text continues it seems very likely that there is no single right answer. That always applies to how to best achieve all this. One person might feel that with each decision we should try as perfectly as possible to represent divergent opinions. Another person might feel that over the whole planning process there are many such decisions, and if we error a little in some of them, the deviations from perfection will average out. Why not do a good job, therefore, but save the extra time required to do a nearly perfect job, in the knowledge that in some and on average, small deviations from perfect accounting in each decision will more or less be made up for by small deviations and others?
Speaker 1:There are other possible attitudes as well, but the point is that, unless in market or centrally planned systems there are where the outcomes are determined by elites with no attention to most of the relevant information, or to most of the impact on others, or to the wills of most people affected, or to the merits of the methods utilized in participatory planning, all these considerations are central. This is not introducing unnecessary complexity. It is addressing actual complexity responsibly. I comment Very often people hear a summary of participatory economics and immediately recoil and pronounce that it is too complicated, it is too demanding. My reaction today here as a comment is that when people say it is too complicated, it really means it is way, way less complicated than what we now suffer, though the incredible complications of our current situation are hidden from me, so out of sight, out of mind, but it is too unfamiliar and so it feels complicated, and it is too demanding means instead of leaving everything to oppressive structures or elites. It requires that I pay attention. A true observation, which leaves out, however, noticing the benefits that that facilitates. The text continues.
Speaker 1:Take the case of the pool in the neighborhood. Perhaps it is proposed by someone living there, then supported by others and then put forward as a specific proposal. We can imagine neighborhoods having settled on procedures for their members to express their reactions. We can imagine the proposal clearly fits into some broad category of decisions typically decided by a particular decision making approach, let's say majority vote by the whole neighborhood. Suppose the proposal passes, along with a plan for how the bill will be charged throughout the neighborhood. The proposal then goes up to the next council level. If folks in higher councils are adversely affected, they begin to consider a new and they may reject the proposal or, more likely, add various amendments that would make it acceptable by reducing or eliminating its adverse implications. There could be agencies with workers' tasks with various functions. In such processes, debate between levels might also occur, leading to refinements as well. If the initiating neighborhood felt that broader constituencies should help with the payment, it would pass up the pool request, not as a finished proposal but as an entreaty that the higher level council adopted is their proposal, rather than the smaller neighborhood having to go it all alone. Or perhaps in a different participatory economy, or even just in a different neighborhood or for a different type of good, there is a higher premium put on streamlining the planning process, so people opt for different routines and procedures or for the example above.
Speaker 1:What if the original vote in the neighborhood council failed? The proposers have a number of options. We can imagine that those in favor might form a subgroup and join together to propose the pool as part of their personal consumption allocations. As with other personal consumption requests, if they were harmed to others the neighborhood could intervene, but otherwise personal consumption requests that are within budgets would be approved. However, because in this case these are personal consumption requests, the requesters would have to forego help with payment for the pool from others in the neighborhood. A second alternative that could be pursued if the original vote in the neighborhood council failed would be that the proposers could go to the next higher council to see if they could convince that body to fund a pool, though the opposition of the neighborhood council would be a strong count against doing so. The situation is roughly the same from Michigan enacting a massive project that would affect people throughout the state, or also in Illinois.
Speaker 1:Each collective consumption good proposed in the planning process is addressed first to determine the appropriate council level to handle it, to be sure all its significant positive and negative effects are dealt with appropriately. Next, research by relevant agencies discovers the properties of the proposal and its implications for various users or bystanders. Reactions are presented. Deliberations take place when there are negative effects, as with pollution, they are enumerated by agreed procedures, charged against the pollution producer and used on behalf of the producer victim. Finally, decisions are made using rules chosen to be as suitable as possible to the case in question. In the negotiations themselves, proposals are likely altered in an effort to arrive at refinements that are universally desired or at least overwhelmingly accepted.
Speaker 1:Take the Michigan dam. Suppose it would displace various people. The initial proposal, we might hypothesize, could have come from a city well away from the proposed site of the dam that was seeking better energy provision and cleaner air and that might have ignored the harsh implications of the dam for those displaced. As the proposal goes up through the ascending couchal levels, the local people who would be displaced, gain knowledge of it and join the liberal liberations. Given the huge impact on them, they would play a powerful role, being given a chance to make known their horror at the idea and the huge negative impact on them. The proposal might be a change to include reimbursing people from the dam region, providing them with new houses in locales of their choosing, uptune, including reconstructing their town elsewhere, all as part of the cost of the dam.
Speaker 1:The point of all this is that, given participatory values, goods with substantial collective impact would be handled by social deliberations that arrive at choices that try to appropriately incorporate the wills of all the people affected, to massage and modify proposals so they become optimal and to apportion payment for costs in accordance with benefits endured and would need be to correct for negative implications or make restitution for them. Moreover, as noted in similar earlier takes on planning, collective consumption proposals and investment projects and determination of externalities would all need to occur for items to be undertaken in the coming year before that year's more basic planning process begins, due to the implications for people's budgets and workloads. Is there only one way to accomplish all these tasks? I don't think so. Is it all accomplished perfectly? Of course not. Are there disputes or mistakes? Of course, these are fallible social processes.
Speaker 1:Economists typically model these kinds of phenomena far more abstractly than they actually occur, but that is not without lessons. For example, we can imagine approaches that forego considerable cooperative negotiation and refinement and instead adopt simpler dynamics. Maybe such a choice would provide a template for various situations, or perhaps collective goods planning. An attribution of external negative and positive effects would remain complex and somewhat messy, but tractable. One key observation and goal will undoubtedly be to ensure that there is no bias, and certainly no bias that snowballs with errors, producing further errors in the same direction. Indeed, a large part of the contrast to markets and central planning is that, in the participatory case, not only will problematic outcomes arise less often, but the source of the problems will be different. Participatory planning problems will be due to ignorance or to actual error, not due to systematic biases that always elevate some groups and make others subordinate, that always incorporate only limited information or that always employ authoritarian procedures. A common.
Speaker 1:I want to reiterate the overarching point that applies here and throughout. One can imagine many possible approaches within and between councils bearing on how to deal with collective consumption and externalities, consistent with solidarity, diversity, self-management, equity, ecological wisdom and classlessness. If you ask me which will be employed, which is true participatory economics and which is not, I have to say the question is ill-conceived. First, there are no doubt different answers in different contexts and, second, what answers are chosen will depend on insights and lessons that emerge from an experience navigating those contexts. So I am just offering examples, on the one hand, to give some texture and feeling, and also offering a logic that I do think is participatory, economic and that I suspect will guide arriving at choices. And this is the difference between that which is what I call the participatory economic scaffold, or that which will establish that an economy is a participatory economy, and the practical details, which can be hugely important but which I think will vary in different instances of this type economy and even different instances of its core features. The text continues Consider cigarettes In the best possible world, the price of cigarettes should reflect not only the usual matters of the labor and other ingredients that go into cigarette production and the desire of consumers for them, but also their impact on those smoking them and on the health system that cares for those who become ill, and the impact on those in the vicinity of smokers and on the health system that cares for them.
Speaker 1:How does the price of cigarettes get set in participatory planning? How well does it accord with the best possible world where some all knowing cosmic process determines all those impacts perfectly? Who pays the cost and who enjoys the benefits? The adverse impact of smoking on health, society might decide, should be paid for by the smokers. Healthcare would be free. But why should everyone in society foot the bill for aspects of healthcare that arise due to predictable, avoidable choices? Then the external health cross of cigarettes would entirely enter the price of cigarettes rather than being a portion to all citizens alike.
Speaker 1:On the other hand, what about sports injuries or even pregnancy? There are issues, obviously, about what aspects of a good's implications are the responsibility of its users and what aspects are properly a part of society's responsibilities. There is no need to explore all dimensions of all variants for all goods here Indeed. To do so would overstep visions proper mandate. We want to propose a visionary scaffold, not a visionary blueprint. What is important about participatory planning is the institutions that could arrive at assessments in such matters, not the specific contextual policies and methods. Future experiences will lead future citizens to settle on and continually improve. Thus, if the above particular prediction about what people would decide was appropriate.
Speaker 1:The price of cigarettes would include a component fee to cover the costs of healthcare for medical problems that arise from smoking cigarettes. The cost would be high. But what about secondhand smoke? Cigarettes are, in this respect, an item with massive external impact. If a local council proposes in sum to consume a total volume of cigarettes 5,000 cartons, say If their consumption was entirely unregulated, the adverse impact from secondhand smoke would be significant. Councils at many levels wanting a healthy environment might be appalled by the overall consumption request.
Speaker 1:What happens? As with the earlier examples, a procedure must determine the external effect. The first possibility is to implement restrictions that would reduce ill effects, such as no smoking zones. A second option might be to charge fees that cover the costs of ventilation methods and medical charges. A third possibility might be to alter the product itself to reduce its ill effects. A fourth possibility could be the more aggressive banning of the product entirely on grounds that there is simply no way to reduce ill effects sufficiently to permitted sensible consumption. Perhaps there are other possibilities. The point is, individual goods which yield adverse collective effects might well be deliberated partly on a personal level, as in each consumer saying that they want or do not want cigarettes, like they want or do not want a new shirt, but also by larger councils that would consider the sum, total consumption by all members and its broader implications.
Speaker 1:I comment the text now takes up another complexity, beginning with a subheading income via allocation and the text continues. When we earlier addressed issues of income, we focused on how it would be accomplished within workplaces by workers' councils in accord with their own agreed procedures for revealing each member's duration, intensity and onerousness of socially valued labor. We presumed, however, that the total payroll for the workplace was already determined and that a portion of the total-allotted payroll among the workplace's workers occurred. In light of that, one can reasonably ask how is the total that is warranted for any particular workplace's workforce determined? Put differently, once a total income for all the workers in a workplace exists, we discussed how an equitable amount for each separate worker could be agreed on by the workers' council of that workplace and why doing so would have proper incentive effects. The workers equitably apportion income in accord with effort and sacrifice, by a value of methods they choose to a degree of accuracy they favor. But a prior question remains what determines the total payroll for each workplace? I interject In an economy like currently exists.
Speaker 1:In a capitalist economy, what determines the total amount of income is the total amount of purchases of the workplace's item minus the costs of their production. After that, various actors get an income based upon, basically, their bargaining power how much they can demand, how much they can take. But it's the total volume of sales which plays a critical role In participatory economics. That isn't the case If a workplace has two workers and they work, you know an average number of hours and an average intensity and so on, but somehow they produce a gargantuan amount of output or the output they produce is exceptionally highly valued. That doesn't mean they get higher wages. They don't get wages for the value of what they produce. They get wages for duration, intensity and onerousness of socially valued labor. Their output has to be valued, but the value of it doesn't determine their income.
Speaker 1:Okay, so the text continues. Consider the whole society's output for an end user, individual and collective consumption. If everyone were to get an average income, including those who cannot work, it would be the value of the total product divided by the total number of people. In that case, if an industry has end workers as a first approximation, the industry would be a lot of end times the average income per worker for the whole society, unless, due to some special industry features, the particular industry's workforce deserved more or less compared to workers in other industries. This could be so, for example, if the particular industry's jobs were, on average, more onerous or if, on average, its workers put in more time or if, on average, they worked more intensely than in other industries.
Speaker 1:Similarly, let's say that mining lithium was allotted some total industry income. As per the logic above, it would have a new and perhaps somewhat altered average income to a lot per worker because, for example, the lithium industry's work on average might be more onerous or its workers' work on average longer or harder. In that case, each lithium workplace would get income to distribute based on its number of workers times the average income per worker for the lithium industry, unless, again due to some features now, a particular lithium workplace deserved more or less than the industry average per worker because, for example, that particular lithium workplace had some old, onerous technology that had been updated in other lithium workplaces, or its workers put in more time or worked more intensely than those in other lithium workplaces. So the idea is that the overall plan directly determines the average income per person in society and thus also the average income per worker. Then industries are allotted a share of overall income based on their number of workers, but with corrections whenever the industry deserves more or less than average per worker due to its special attributes. Next, each industry determines the total payroll to be allotted to each of its workplaces as the average per industry worker times the number of workers in each of the industry's workplaces, corrected, however, if any particular workplace deserves more or less than average per worker due to its special features. And then each workplace's workers' counsel allots its payroll to its members with the same proviso.
Speaker 1:So some new questions arise 1. How does society make judgments about whole industries? 2. How do whole industries make judgments about their component workplaces? 3. How do firms make judgments about their member workers? The third question we answered earlier Each workplace determines a procedure to use to determine who has worked longer or less long, harder or less hard or under worse or better conditions than average in the workplace and employs their procedure to a degree of precision acceptable to the workers in the workers' counsel in question.
Speaker 1:Now take that logic up one level. Each industry determines a procedure to use to allot the industry total among all the industry's workplaces and employs it acceptably to the industry's federation of its workers' counsels. Take it up another level. The societal counsel of all workers determines a procedure to use to apportion income to society's various industries that is acceptable to the whole population. The procedure chosen determines if each or any industry, or then if each or any workplace within an industry, and then if any work or within a workplace endures above or below average onerousness, or works above or below average duration or intensity, or has above or below average means of production, or above or below average costs for inputs, or if workforces are above or below average in their actual productive capacity. One approach is that to determine the various factors by whatever means experience shows agreeable and effective. Each level addresses the social products and social costs of the industry or of the workplace or of the worker, to ensure that work that is socially valued or otherwise justified is properly remunerated.
Speaker 1:Since the above gets into some more complex aspects of how to have a worthy allocation system, let's try giving it another run-through with a different slant. The issue we are considering centers on how participatory planning and counsel, self-management together, provide appropriate income. There is already clarity about what constitutes equitable income and how a workplace counsel can allocate its allotted payroll to its workers. They do it, we have proposed, as they decide, equitably and with incentives that work, and so on. The question we are now considering is how it comes about that the income allotted to each workplace as income to divide among its workers, that is, as the total payroll for the workplace, is what equity for the various workers calls for it to be. In other words, how is the total income allotted for all workers in each workplace determined such that the total payroll is what it needs to be for each worker in the workplace to receive his or her equitable income? Our answer is that average income is settled for society by the overall plan. Divergences from average are then settled for industries and then in turn for firms within industries and then finally for workers within firms, each by the involved workers' counsel structure at the level in question.
Speaker 1:Imagine a workplace has workers all working average duration, intensity and onerousness for its industry. In that case, that workplace would be allotted the average income per worker for its industry times its number of workers, and each worker would receive that average and all would be well. But what if some of the workers in that same workplace, in that industry work considerable overtime, or in another workplace some do not exert, or still another workplace in the industry has some unduly onerous conditions and so on. What causes the total allotted to each workplace to be such that it equals the sum of what ought to be the income for all of that workplace's workers, even with many of them deviating from the average inside the workplace? Or because the workplace itself deviates from average in its industry, or because the industry deviates from average in society?
Speaker 1:The first thing to notice is that at the level of industries in society and of workplaces in an industry, it is rather like at the level of separate workers in a single workplace. So the whole planning process society establishes total income for society. Dividing by population gives average income per worker. Then society allocates the total societal income among all society's industries, that is, it determines the total income for each industry, which is the industry's total of workers times the average worker's income for the industry, but with an industry correction for each industry, with lithium mining being more onerous than publishing, for example, so that lithium work gets higher average income. Now each industry has its own total income and its new average per worker within the industry, which may differ from the overall average for society due to the industry correction.
Speaker 1:Next, the industry has to apportion its allotted total among the industry's workplaces. Each workplace gets the industry average per worker times the number of workers it has, but now with a possible workplace correction because some workplaces may differ from others in onerousness, intensity or duration. Finally, as the last step, each workplace has to apportion its allotted total among its workers. Each worker gets the workplaces average per worker, modified by a correction if some in the workplace work more, some less, and so on. So what are the corrections? Each industry should receive the social average income for each of its workers if each industry had the same average duration, intensity and onerousness of socially valued work for its workers. So the correction for different industries should account for each industry's deviation from that overall average. Then the same occurs for differences among workplaces within each industry and finally it occurs as well for differences among workers inside each workplace.
Speaker 1:Arriving at the specific determinations is a bit complicated, and more so when we take into account job balancing. But the relevant point is not the details but the overall aim and outcome, which is remuneration for the duration, intensity and onerousness of socially valued work, while also providing the socially average income for those who can't work and, of course, providing health care and diverse other public or personally free goods for everyone. I comment so I mainly explained the general goal and indicated some elements of it in possible implementations. That is, it seems to me, what is needed to make a case for worthiness and viability of the proposal. The text then took on another topic. The text continues what about production of means of future, production, which we call investment and which often requires years to complete and further years to have impact? Investment includes the dam discussed earlier, but also things like new equipment or new factories, where the aim is to increase productivity.
Speaker 1:It is hard to handle wealth for a number of reasons, not least that there are current and future consumers, and they can be entirely different people, with the latter not available to express themselves or not even born when investments are initiated. A key reality is that whatever assets we use for investment for the future, we don't use for producing consumer goods for the present. And whereas current population benefits from consumption now, future population benefits from investment now to enlarge well-being later. We want methods that self-consciously protect and benefit both constituencies, rather than sacrificing one to benefit only the other or vice versa. A second complication is that future preferences and production possibilities can only be guessed at now and that implemented plans continually change the setting of future plans. This means we are guessing future preferences and future effects of our proposed investments. Honest error is quite possible. In fact, to an extent, honest error is inevitable.
Speaker 1:So whenever we undertake an investment plan, it will very likely, at least to some degree, have flaws. Catching such flaws and revising plans in subsequent years is another essential need. Proposals for investments in new consumer products would most often originate in the National Federation of Consumer Councils. Indeed, these councils would not only be intrinsically more closely in touch with consumers' needs and ideas, they would also likely employ workers to do research to inform such proposals. Similarly, proposals for investments in new tools for production or for simply producing more familiar tools would likely come from workplace councils and ultimately from the Industry and National Federation of Workers Councils and the federations, and perhaps each workplace would likely also employ some workers to do research to inform such proposals. The exact procedures to use to price such projects, to decide on enacting them and to later account for the implications for production and yearly planning would certainly be more complex than more basic yearly planning, but would nonetheless be guided by the same values and the same need to function compatibly with the rest of the proposed economic vision. The same holds as for what we earlier called updating as a yearly plan unfolds, but which, in the case of long-term investment, becomes that we carry out year one of the investment plan to discover that things have changed from what we have predicted, and so now we have to update subsequent years.
Speaker 1:What about innovations that don't even fit within an industry but would instead generate whole new industries? Would this be left to university research, or might society have an actual innovation industry whose mandate is to pursue and be a temporary home for such undertakings before they can stand alone as industries participating in planning? Or would both approaches exist or another Time will tell, but what wouldn't occur are approaches undermining self-management, equity, solidarity, diversity, sustainability or participation. To what extent can the yearly and multi-year investments of planning processes work like the yearly planning process of negotiated cooperation among councils, and to what extent will it instead require a set of additional agencies based in federations of councils, not only to generate proposals but so that, when a large-scale deliberation generates refinements and then an overall vote arrives at investment plans which later inform yearly planning? It seems likely that such choices, and perhaps other possibilities as well, will emerge from the future experience and its lessons. But for investment planning to provide part of the information for yearly planning, the main issue will be to ensure that it doesn't interfere with and preferably that it further advances solidarity, diversity, equity, sustainability and self-management.
Speaker 1:The point of the final sections of this chapter, and thus the point of this episode on participatory planning, has been to give a loose introductory feel to some possible approaches to certain detailed pricing and deliberative properties of participatory planning vis-a-vis public goods and what are currently called externalities, whether positive or negative, as well as to allocative processes able to provide equitable incomes and to some of the complexities of investment planning. Participatory economics is a vision whose defining logic and features advance certain core aims and whose social processes will diverge from those aims only due to honest errors or perhaps the choice to save time by settling negotiations satisfactorily rather than more perfectly, but not due to some systematic incapacity or recurring bias that inexorably obstructs aims On all these counts, and particularly for technical aspects of participatory planning, a new book by Robin Hinele, democratic Economic Planning, referenced in our closing selected references, goes further into elaborating possible approaches to and proposals regarding some mathematical complexities than does this chapter For now, regarding our proposal for the essentials of a new economy and thus for a visionary economic scaffold. It comes down to this Do we want people to receive income in accord with capital ownership, power or the value of each person's personal contribution to social production, or do we prefer to base any differences in workers' consumption rights only on differences in duration, intensity and onerousness in producing socially valued goods and services? In other words, do we want an economy that implements the maximum quote to each worker according to the value of his or her property or power or personal contribution, or do we want an economy that implements the maximum quote to each worker according to his or her socially valued effort? Likewise, do we want a capitalist or coordinator few to conceive and coordinate the work of an obedient many, or do we want everyone to have the opportunity to participate in economic decision making to the degree they are affected by the outcome and to enjoy training in other job circumstances that guarantee their capacity to do so? In other words, do we want to continue to organize work and preparation for work hierarchically, preserving class division, or do we want to balance jobs and utilize training for empowerment to attain classlessness?
Speaker 1:Further, do we want a structure for expressing preferences biased in favor of individual over social consumption, or do we want to make it as easy to register preferences for social as for individual consumption? Do we want prices that mishandle or ignore broad social and ecological effects, or do we want prices that account for personal, social and ecological costs and benefits? Do we want economic decisions to be determined by individuals and groups who compete against one another for well-being and survival, where the enhancement of each is attained only at the expense of some other, or do we want to plan or join endeavors democratically, equitably and efficiently, with all actors having self-managing influence and each benefiting in parallel with the rest? In other words, do we want to abdicate economic decision-making to the market or central planning, or do we want to embrace the possibility of participatory planning? In sum, do we want to continue either capitalist rule and production for profit, or coordinator rule and production for surplus, both with ecological decay, inequity and class rule, or do we want to attain classlessness, self-management, equity and attention to full social and ecological implications, and this to ecological and social sanity? It may sound melodramatic, but do we crave class rule or classlessness? Do we desire antisociality or solidarity? Will we have barbarism or will we have participatory economy? And that said, this is Michael Albert signing off until next time for Revolution Z.