One of the most common questions posed by anarchists looking at the parecon model concerns the existence, or nonexistence, of a state in a society with a functioning participatory economy. What is the role, if any, of government in the maintenance of a parecon system? Further, what role, if any, might a state take in the establishment of a participatory economy? These are very important questions, if only because as activists working for radical change not only in the economic, but also the political sphere, we are concerned with issues of strategy and consistency with our ideals.
The short answer is simple: No, there is nothing in the abstract theory, in the existing literature on parecon, which necessarily calls for state intervention in or control of economic activity.
Of course, there is always a “but…” Satisfactory answers are rarely that simple, and neither staunch anti-authoritarians nor those more willing to accept various forms of government in a revolutionary society, are likely to settle for such a basic explanation. In addressing anarchists on the question of parecon and the state, it’s important to note that advocates of parecon are not necessarily in total agreement on these questions. We do agree, though, that the state has no role to play in an economy to the extent that economy has rendered political intervention unnecessary. However obvious, that’s the key point. If you understand the basic concepts of participatory economics, it shouldn’t be hard to see why a parecon could function – though perhaps not optimally – in the absence of tinkering from the political institutions. (These issues are handled briefly in John Krumm’s ParEcon FAQ.)
The Government and Economic Functioning
One mainstay of parecon is the relative separation of the political and economic spheres. It’s assumed that certain affairs will be handled by political institutions, others by economic institutions. The latter are tasked, in any society, with the maintenance of material relations: the production, allocation and consumption of goods and services. Meanwhile, the polity, whatever form it takes, handles the organization of a society’s moral function. Be it a strictly hierarchical and undemocratic state, or a loose array of institutions intended to coordinate such activities as dispute mediation (as in “the anarchist ideal”), or something in between, the polity serves a function which can theoretically be almost wholly removed from the economy.
Most of what present day governments handle in so-called “mixed economies” is the consumption, production and allocation of public goods and services. But since these activities are central concerns of the parecon model, as described in detail by Albert and Hahnel, the need for a polity to take on such tasks becomes superfluous, assuming proper development and functioning of the participatory economy. It is decidedly difficult for people living in our present society, where capitalism cooperates and clashes with the state in so many ways, to imagine a society where the economy is organized (a) along principles of direct democracy, with controls to ensure the participation and fulfillment of all economic actors on an equitable basis, while remaining (b) outside the control of political institutions.
Somewhat ironically, when many anarchists inquire about the necessity of state involvement in a parecon, they have actually assumed that political institutions will need to be involved in the “governing” of economic affairs, in order to maintain a balance between the people (or the “community”) on one hand, and economic institutions on the other hand. But just as the polity in an anarchistic society can be established such that the people are the polity, so too does parecon ensure that the people are the economy.
In fact, while the processes for democratic politics are in many ways different from democratic economic activity, the guiding principles are the same: decision-making input in accordance with the amount one is in turn affected by the outcome of a given decision. Of course, both economic and political democracy also require transparency of decision-making processes, in addition to full availability of information relevant to decisions. In truth, because economics is a more tangible “science” than politics, it is actually easier to determine fairness of input and outcome (both quantitatively and qualitatively) in an economy than in a polity.
Some questions arise at this point. One regards the relationship between morality and the decisions made in a participatory economy. Parecon is by no means “amoral” – many of the concerns addressed by parecon are particularly ethical ones, especially in parecon’s promotion of equitable circumstances and rewards for economic actors. Exploitation of labor, as well as resources, are thoroughly dealt with as both implicit and explicit issues. But the present theories are limited.
For instance, there are many people who believe there is inherent value in “nature,” from trees to animals to soil. They argue that nature has a value not to be determined merely in accordance with ecology’s effects on or usefulness to human society. To such people, human interaction with the natural environment, whether it’s called economics or something else, is a vital concern. Even if this seems a bit extreme, it should be generally agreeable that all our social activity should take into account its effects on the world around us. While some “humanists” may argue that questions of environmental impact shouldn’t extend beyond their discernible effects on human society and social well-being, many people (perhaps most) reject this outright. That is, even if it could be proven that the extinction of a certain species by humans would have no effect on humans or society whatsoever, few would be willing to accept the extinction of that species, at least without such extinction leading to some substantial human gain, or there being a definite lack of reasonable alternatives. Even then, many would have ethical concerns with human-induced extinction, or even exploitation, of other species.
Obviously, there either needs to be further development of parecon theory to incorporate mechanisms for introducing solely “ethical” or “moral” ecological factors into a desired economy, or we must assume that some political intervention is necessary. A purely “humanist” economy is unlikely to satisfy many people, since it is inherently incapable of protecting the “nonhuman” environment except as the latter pertains to human needs.
So what are the options? One is to include qualitative valuations of environmental effects into parecon. To the extent the environmental impact of economic activity in turn effects humanity, the “pricing” mechanism of parecon incorporates the need to discourage such activities with high social costs and encourage those yielding social benefits. But the key word here is obviously “social.” If it is deemed socially beneficial (by a standard, humanist definition of “social”) to exploit animals, for example, a parecon will make exploitation possible.
Adding further mechanisms for qualitative valuation of parecon activity is certainly possible, but of course it would be humans who ultimately make the qualitative judgements, based on evaluations and decisions more political than economic, if we can truly separate both concepts. Alternatively, a polity could impose regulations on economic activity as a result of deliberation and democratic decision-making with regard to moral concerns. In a society with the ability to legislate, laws could be established through political means which would effectively place bounds on economic activity.
This debate about moral authority and economic activity in a parecon society is likely to be alive well after a participatory economy has been established through popular revolution. It probably behooves us greatly to leave these questions wide open for now. Indeed, so often we see only two options (recall market capitalism vs. central planning…) – perhaps there is a “third way” here, too. I have discussed these issues here only to highlight the fact that there may very well be a need for political intervention in a parecon, in the relatively few areas where the economy itself has not been structured suitably to handle certain concerns. To its credit, participatory economic vision has left remarkably little outside the capable domain of the economic institutions it envisions – before we get too troubled by questions like those raised above, we should take note that few such questions even exist.
Government and Establishing ParEcon
Since I am elsewhere writing more extensively on strategy for bringing about a participatory economy, I will only briefly comment on the role the state should or should not play in economic transformation. Obviously, if we look at the process of changing over to parecon as starting now, the state presently in power plays a role whether we like it or not. There are clear legal prohibitions on the development of parecon, and the current government is certainly on the side of pareconers’ capitalist adversaries.
This doesn’t, however, exclude political activity from our tactical toolbox. If the development of stronger, more democratic unions is a component of economic revolution, it makes sense to strengthen laws which protect labor organizing. If increased consumer awareness now is recognized as lending to the creation of consumer control in a transformative, participatory economy, it’s reasonable to pressure the state to regulate capitalists’ packaging and promotion of their products. Also, the imperative of consumer control, in present political terms taking the form of government bodies which restrict the powers and “freedoms” of producers to exploit or “cut corners,” leads us to advocate an increase in government authority where the oversight and limitation of corporate activity is concerned. If resisting neoliberalism will strengthen domestic labor forces worldwide, we should fight “free trade” agreements and support legal restrictions on multinational capital.
Many whom we might call “anarcho-purists” insist that any advocacy of government intervention (or existence) strengthens the present state and is thus anathema to our aims. To a large extent, this rings true in reality. Looking to the government to resolve our problems certainly distracts us from our own, popular power. Still, we should be willing to admit that in the here and now, certain exploitations of workers, consumers and the environment cannot be resisted directly by existing social movements. While every activist has priorities, and radicals tend to place theirs on popular (not electoral or legislative) organizing, this doesn’t mean anyone should be unable to recognize small victories such as the restriction of corporate power to assault people and the environment. There is a noteworthy difference between using reforms as tactical components of a revolutionary strategy, and focusing on reforming society as the strategy.
In the end, we can all agree that organizing which turns its back on (or directly confronts) the state in favor of direct democracy and participatory development of economic alternatives is absolutely necessary if we truly wish to revolutionize society. Since we live in a society with a very strong government, we cannot deny that it will play some role in economic change – mostly resisting (at least for now), but perhaps also abetting.
That said, we should all be fully aware that if the revolutionary economy we seek is to be truly democratic and participatory, it cannot be legislated into existence from the top down. It will never make sense to lobby for the implementation of a parecon system, not least because it’s ridiculous to assume any government would support an economy which largely (if not totally) excludes government involvement and functions generally independent of political intervention. Additionally, the decentralized nature of parecon demands its development at and emergence from the grassroots.
To the extent parecon is agreeable to anarchistic aims, because of its directly democratic, participatory structures and processes, it will have to be brought about by means precisely consistent with such ends. Perhaps benefiting along the way from gains achieved through political agitation, only through hard work at the grassroots level will we be able to create the foundation for an economic system we can truly be happy with.
In dealing with a different kind of polity – a revolutionary polity managed by a directly democratic, participatory government – the question of government’s role in establishing a parecon changes quite dramatically. At some point, rules, policies and structures for the new economy will have to be established. As the authors of existing material on parecon theory would be the first to explain, it wouldn’t be desirable for those creating a new society to one day sit down and start directly implementing parecon theory as now written. Some rather thorough decision-making process, based on theory and experience, has to take place in formalizing and setting up a participatory economy.
Even in a society populated by a foundation of participatory cooperative workplaces and the like, transformations will be necessary. Indeed, these decision making and transitional processes will need to take place over and over again in different societies and communities, with varying results. In cases where democratic polities have been established, it might make sense for them to take on the organization of a participatory economy by coordinating and implementing the mandates of populations.
Most likely, directly accountable councils or committees would be established at numerous levels, perhaps in cases independent of one another, to write public proposals for parecon bylaws, policies and so forth. This would ideally occur during a period when the general public is becoming more educated about economic theory and vision. That is to say, during a revolutionary period.