Free & Fair, Part II

This is Part II of a series. Read Part I here.

“The inherent vice of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of miseries.” – Winston Churchill

“The rich get richer / The poor get the picture” – Midnight Oil

If you give me a fish, you have fed me for a day. If you teach me to fish, then you have fed me until the river is contaminated or the shore line seized for development. But if you teach me to organize, then whatever the challenge I can join together with my peers and we will fashion our own solution. – Ricardo Levins Morales

In the big picture, there are only two kinds of economies: market and command. In a market economy, you buy and sell what you want and can afford. In a command economy, you sell what you’re told to, and buy whatever you can. The command economy has traditionally been equated with the left, and the market with the right. But increasingly, I’ve come to believe that’s not accurate.

The classic example of a command economy is the Soviet Union, which was famously dour and inefficient. Far from the workers’ paradise its founders envisioned, it became more of a prison camp with twelve time zones.

In contrast, the West surged ahead in the 20th century, creating more wealth than the rest of human history combined. Yet that wealth was extremely concentrated, and the workers in the West also suffered and at times even starved. A dash of command economics, a la Keynes, took the edge off their suffering. But the fact remained that while command economics weren’t doing any good for the workers, the market wasn’t doing much for them, either.

The secret was, most of the workers weren’t in the market at all. They worked for big companies — which is to say, they were in command economies.

A large company has the same inefficiencies as any government, and for the same reason: decision-making simply doesn’t scale up that far. Governments at least allow citizens to vote for the people at the top of the pyramid — companies make only cosmetic gestures (if that) towards considering worker input. People at any tier of the hierarchy can pretend to be — or for that matter, can genuinely be — honest, good-hearted people, but it doesn’t matter. The problem is structural. Disagreements are not worked out. Rather, one tier simply issues commands, and the tiers below it must obey, or lose their job. It doesn’t make the slightest difference how good or bad the command is.

It is always the ones at the top who win, and always the ones at the bottom who lose. This applies equally to the Soviet Union and to modern corporations. The losers (in the West) aren’t generally as bad off as they were a generation ago, but this isn’t because of any benevolence on the part of the top tier. Rather, it’s due to a combination of the stridency of the labor movement and the paternalism of the welfare state wringing some concessions out of them. Even so, benefits to the upper classes vastly outpace benefits to the lower classes in both absolute and relative terms.

In the Soviet Union, there was no alternative, unless you were up for trying to flee. In the West, people can move from one job to another, at least in theory. But they cannot escape the model…. unless they throw caution to the wind and start their own business (going into the public sector or non-profits rarely does much to address the issue of scale).

An important lesson is that the market works for big businesses. They generate billions upon billions of dollars every year in the market (there are many ways they cheat the market, but that’s another essay). The bulk of that money stays with the top tiers, because… that’s what they’ve decided. They chart the course their business will take in the market, and the rest of the employees are not human beings with free will, but resources to be leveraged. These “human resources” are not in the market, and hence do not benefit from it. They are footsoldiers who take orders for their pay, regardless of how conscientious or creative their work may be.

But where does the left fit in to all this? Isn’t the left opposed to, or at best suspicious of, markets? That is the conventional wisdom, but I’ve come to believe that’s because of some muddled or even duplicitous thinking on both the left and right. By conventional wisdom, the left favors the state, and the right favors the market. The left — by which I mean the Soviet model — concentrated power in the state so as to serve the people better than the market had done. It was an utter failure. The right concentrates power in market participants to serve… well, themselves, but with assurances that the rest of us will somehow eventually benefit from their opulence. By and large, it’s not happening.

Both ends of the traditional spectrum take power away from us, and promise us we’ll be better off for it. We’re not.

If we want the economy to benefit us, we must participate in it personally, not by proxy. If we are to be empowered, then we must take our fate into our own hands. A command economy denies this to us, by definition, so the only option left to us is the market.

But before you call me a rightist, let me clarify that. If we are to be in the market, then we must all be in the market. Otherwise, we’re right back where we started, with corporate masters pulling the strings of their human resources. So, how can everyone in a company be in the market, and share its bounty?

By collective and democratic decision-making. This is formalized through worker ownership of the means of production. Not in some symbolic or representative fashion, but in a direct and literal way. The lesson of both the traditional right and the tradition left is that the system benefits those who own and run it — so, logically, the route to shared benefits is shared ownership and management.

We’ve tried the path of violent revolution and state ownership of the means of production, and we all know how that ended up. Now it’s time to try non-violent mini-revolutions, one workplace at a time. In fact, it’s already happening. There are many worker-owned companies out there, and the number is growing slowly but steadily. They tend not to be especially showy, but they are there to be found. They aren’t terribly big, because as I said earlier, direct decision-making only scales up so far. And that’s OK.

In fact, in a way, that’s kind of the point. This brings us back to the old meaning of “company” — we don’t just work in a company, we work in each other’s company.

Continue to read Part III.