Parecon and Internationalism
This essays is excerpted from the Zed Press book, Realizing Hope
For this chapter, to take a different angle on things, let’s begin with what we currently endure internationally and ask what changes we would like to win with our activism, short and mid term. Then we can see what our aspirations for international relations imply for economics per se, and, in turn, what our proposed new economic vision implies for international relations.
Rejecting Capitalist Globalization
Current international market trading overwhelmingly benefits those who enter today’s exchanges already possessing the most assets. When trade occurs between a
Opportunist rhetoric aside, capitalist globalizers try to disempower the poor and already weak and to further empower the rich and already strong. The result: of the 100 largest economies in the world, over half aren’t countries, they are corporations, and tens of millions throughout the world not only live in abysmal poverty, but starve to death each year.
Similarly, international market competition for resources, revenues, and audience is most often a zero sum game. To advance, each market participant preys off the defeat of others so that capitalist globalization promotes a me-first attitude that generates hostility and destroys solidarity between individuals, corporations, industries, and states. Public and social goods are downplayed, private ones are elevated. Businesses, industries, and nations augment their own profits while imposing losses on other countries and even on most citizens of their own country. Human well being is not a guiding precept.
Moreover, in current global exchange structures, whether they are McDonaldsesque or Disneyesque, or even if they instead derive from worthy indigenous roots, cultural communities and values disperse only as widely as their reach permits them too, and worse, are routinely drowned out by other communities with greater reach.
Capitalist globalization swamps quality with quantity. It creates cultural homogenization, not diversity. Not only does Starbucks proliferate, so do
In the halls of the capitalist globalizers, only political and corporate elites are welcome. The idea that the broad public of working people, consumers, farmers, the poor, and the disenfranchised should have proportionate say is actively opposed. Indeed, the point of capitalist globalization is precisely to reduce the influence of whole populations, and even of state leaderships, save for the most powerful elements of Western corporate and political rule. Capitalist globalization imposes corporatist hierarchy not only in economics, but also in politics. Authoritarian and even fascistic state structures proliferate. The number of voices with even marginal say declines.
As the financiers in corporate headquarters extend stockholders’ influence, the earth beneath is dug, drowned, and paved without attention to other species, to by-products, to ecology, or even to humanity. Only profit and power drive the calculations.
Anti-globalization activists oppose capitalist globalization because capitalist globalization violates the equity, diversity, solidarity, self-management, and ecological balance that activists pursue.
Capitalist globalization also establishes norms and expectations of international dominance and subordination. To establish, enforce, defend, and punish violations of those norms, the strong will often use violence against the weak. Domestically this means growing police state apparatuses and repression. Internationally it means local, regional, and international hostilities and war.
So the question naturally arises, what is the alternative to capitalist globalization violating, as it does, virtually all norms of civilized and mutually beneficial exchange and development?
Supporting Global Justice
What do anti-globalization activists propose to put in place instead of the institutions of capitalist globalization, including most prominently the International Monetary Fund, the World Bank, and the World Trade Organization?
The International Monetary Fund or IMF and World Bank were established after World War II. The IMF was meant to provide means to combat financial disruptions adversely impacting countries and people around the world. It initially used negotiation and pressure to stabilize currencies and to help countries avoid economy-disrupting financial machinations and confusion.
The World Bank was meant to facilitate long-term investment in underdeveloped countries and to expand and strengthen their economies. It was set up to lend major investment money at low interest to correct for the lack of local capacity.
Within then existing market relations, these limited IMF and World Bank goals were progressive. Over time, however, and accelerating dramatically in the 1980s, the agenda of these institutions changed. Instead of facilitating stable exchange rates and helping countries protect themselves against financial fluctuations, the IMF began bashing any and all obstacles to capital flow and unfettered profit seeking, despite that this was virtually the opposite of its mandate.
Instead of facilitating investment on behalf of local poor economies, the World Bank became a tool of the IMF, providing and withholding loans as carrot or stick to compel open corporate access. It financed projects not with an eye to accruing benefits for the recipient country, but with far more attention to accruing benefits to major multinationals.
In addition, the World Trade Organization (WTO) that was first proposed in the early postwar period actually came into being only decades later, in the mid 1990s. Its agenda became to regulate trade on behalf of ever greater advantages for the already rich and powerful.
Beyond imposing on third world countries low wages and high pollution due to being able to easily coerce their weak or bought-off governments, as IMF and World Bank policies were already achieving by the 1990s, the idea emerged that the rich could also weaken all governments and agencies that might defend workers, consumers, or the environment, not only in the third world, but everywhere. Why not, wondered the truly powerful, remove any efforts to limit trade due to its labor implications, its ecology implications, its social or cultural implications, or its developmental implications, leaving as the only legal criteria of trade’s regulation whether there are immediate, short-term profits to be made? If national or local laws impede trade - say an environmental, health, or labor law - why not have a new organization of world trade to adjudicate disputes, and to render an entirely predictable pro-corporate verdict in all cases? The WTO was thus added to the IMF/World Bank team to trump governments and populations on behalf of corporate profits.
The full story about these three centrally important global institutions is longer than this brief synopsis can present, of course, but even with only an overview, improvements are not hard to conceive.
First, why not have, instead of the IMF, the World Bank, and the WTO, an International Asset Agency, a Global Investment Assistance Agency, and a World Trade Agency. These three new (not merely reformed) institutions would work to attain equity, solidarity, diversity, self-management, and ecological balance in international financial exchange, investment, development, trade, and cultural exchange.
They would try to ensure that the benefits of trade and investments accrue disproportionately to the weaker and poorer parties involved, not to the already richer and more powerful.
They would not prioritize commercial considerations over all other values, but would prioritize national aims, cultural identity, and equitable development.
They would not require domestic laws, rules, and regulations designed to further worker, consumer, environmental, health, safety, human rights, animal protection, or other non-profit centered interests to be reduced or eliminated, but they would work to enhance all these, rewarding those who attain such aims most successfully.
They would not undermine democracy by shrinking the choices available to democratically controlled governments, but would work to subordinate the desires of multinationals and large economies to the survival, growth, and diversification of smaller units.
They would not promote global trade at the expense of local economic development and policies, but vice versa.
They would not force
They would not block countries from acting in response to potential risks to human health or the environment, but would help identify health, environmental, and other risks, and assist countries in guarding against their ill effects.
Instead of downgrading international health, environmental, and other standards to a low level through a process called “downward harmonization,” they would work to upgrade standards by means of a new “upward equalization.”
The new institutions would not limit governments’ ability to use their purchasing dollars for human rights, environmental, worker rights, and other non-commercial purposes, but would advise and facilitate doing just that.
They would not disallow countries to treat products differently based on how they were produced - irrespective of whether they were made with brutalized child labor, with workers exposed to toxins, or with no regard for species protection - but they would instead facilitate just such differentiations.
Instead of bankers and bureaucrats carrying out policies of presidents to affect the lives of the very many without even a pretense at participation by the people affected, these new institutions would be open, democratic, transparent, participatory, and bottom up, with local, popular, and democratic accountability.
These new institutions would promote and organize international cooperation to restrain out-of-control global corporations, capital, and markets by regulating them so people in local communities could control their own economic lives.
They would promote trade that reduces the threat of financial volatility and meltdown, expands democracy at every level from the local to the global, defends and enriches human rights for all people, respects and fosters environmental sustainability worldwide, and facilitates economic advancement of the most oppressed and exploited groups.
They would encourage domestic economic growth and development, not domestic austerity in the interest of export-led growth.
They would encourage the major industrial countries to coordinate their economic policies, currency exchange rates, and short-term capital flows in the public interest and not for private profit.
They would establish standards for and oversee the regulation of financial institutions by national and international regulatory authorities, encouraging the shift of financial resources from speculation to useful and sustainable development.
They would establish taxes on foreign currency transactions to reduce destabilizing short-term cross-border financial flows and to provide pools of funds for investment in long-term environmentally and socially sustainable development in poor communities and countries.
They would create public international investment funds to meet human and environmental needs and ensure adequate global demand by channeling funds into sustainable long-term investment.
And they would develop international institutions to perform functions of monetary regulation currently inadequately performed by national central banks, such as a system of internationally coordinated minimum reserve requirements on the consolidated global balance sheets of all financial firms.
These new institutions would also work to get wealthy countries to write off the debts of impoverished countries and to create a permanent insolvency mechanism for adjusting debts of highly indebted nations.
They would use regulatory institutions to help establish public control and citizen sovereignty over global corporations and to curtail corporate evasion of local, state, and national law, such as by establishing a binding Code of Conduct for Transnational Corporations that includes regulation of labor, environmental, investment, and social behavior.
And beyond all the above, in addition to getting rid of the IMF, World Bank, and WTO and replacing them with the three dramatically new and different structures outlined above, anti-globalization activists also advocate a recognition that international relations should not derive from centralized but rather from bottom-up institutions. The new overarching structures mentioned above should therefore gain their credibility and power from an array of arrangements, structures, and ties enacted at the level of citizens, neighborhoods, states, nations and groups of nations on which they rest. And these more grassroots structures, alliances, and bodies defining debate and setting agendas should, like the three described earlier, also be transparent, participatory and democratic, and guided by a mandate that prioritizes equity, solidarity, diversity, self-management, and ecological sustainability and balance.
The overall idea is simple. The problem isn’t international relations per se. Anti-corporate globalization activists are, in fact, internationalist. The problem is that capitalist globalization alters international relations to further benefit the rich and powerful.
In contrast, activists want to alter relations to relatively weaken the rich and powerful and empower and improve the conditions of the poor and weak. Anti-corporate globalization activists know what we want internationally - global justice in place of capitalist globalization. But what if that is what we want internationally, what implications does it have for what we want domestically, inside our own countries?
Participatory Economics Not Capitalist Greed
There is still a vision problem for anti-globalization activists, even after we describe alternative global economic institutions. Everyone knows that international norms and structures don’t drop from the sky. It is certainly true that once in existence they impose severe constraints on domestic arrangements and choices, but it is also true that global relations sit on top of, and are propelled and enforced by, the dictates of domestic economies and institutions.
The IMF, World Bank, and WTO impose capitalist institutions such as markets and corporations on countries around the world, of course. But the existence of markets and corporations in countries around the world likewise propels capitalist globalization.
So when anti-globalization activists offer a vision for a people-serving and democracy-enhancing internationalism in place of capitalist globalization, we are proposing to place a very good International Asset Agency, Global Investment Assistance Agency, and Global Trade Agency, plus a foundation of more grassroots democratic and transparent institutions on top of the very bad domestic economies we currently endure. The problem is that the persisting domestic structures inside our countries would continually work against the new international structures we construct on top of them. Persisting corporations and multinationals would not positively augment and enforce our preferred new international structures, but would at best temporarily succumb to pressures to install them and then perpetually exert pressures to return to their more rapacious ways.
So when people ask anti-globalization activists “what are you for?” they actually aren’t asking only what are we for internationally. They also mean, what are we for in place of capitalism?
If we have capitalism, they reason, there will inevitably be tremendous pressures for capitalist globalization and against anti-capitalist innovations. The new IAA, GIAA, and GTA sound nice, but even if we put them in place, the domestic economies of countries around the world would push to undo them.
Capitalist globalization is, after all, domestic markets, corporations, and class structure on a large scale. To really replace capitalist globalization and not just mitigate its effects, we would have to replace capitalism too. Reducing or ameliorating corporate globalization via the proposed new international institutions shouldn’t be an end in itself, but should be part of a larger project to transform the underlying root capitalist structures as well.
If we have no alternative to markets and corporations, many feel, our gains would be at best temporary. This assessment is widely held and fuels the reactionary slogan that “there is no alternative.”
To combat this mentality and underlying reality we need an alternative vision regarding international agencies and global economics, such as the proposed new institutions, but also an alternative vision regarding markets, corporations, and domestic economies.
Capitalist economics revolves around private ownership of the means of production, market allocation, and corporate divisions of labor. Remuneration is for property, power, and, to a limited extent, contribution to output, all causing huge differences in wealth and income. Class divisions arise due to differential property ownership and due to differential access to empowered versus obedient work. Huge differences exist in decision-making influence and in quality of circumstances. Buyers and sellers one-up each other, and the broader public reaps what self-interested competition sows. Antisocial trajectories of investment and personality development result. Decision-making ignores or exploits ecological decay. Reduced ecological diversity results.
To transcend capitalism, suppose we were to advocate the same values I proposed above for global assessments: equity, solidarity, diversity, self-management, and ecological balance. What institutions could propel these values in domestic economics, as well as admirably accomplish economic functions?
Of course in this book our answer is parecon and we don’t need to repeat the first chapter’s summary of its features save in a very abbreviated form.
In a new economy consistent with just international relations, all citizens own each workplace in equal part. This ownership conveys no special right or income. Bill Gates won’t own a massive proportion of the means by which software is produced. We will all own it, or symmetrically, no one will own it. Ownership becomes moot regarding distribution of income, wealth, or power.
Next, workers and consumers will be organized into democratic councils that disperse information and arrive at and tally preferences in ways that convey to each participant influence over decisions in proportion to the degree he or she will be affected by them.
Councils will be the seat of decision-making power at many levels, including work groups and teams and individuals, and workplaces and whole industries. People in councils will be the economy’s decision-makers. Votes could be majority rule, three quarters, two-thirds, consensus, etc.
Next, we alter the organization of work by changing who does what tasks in what combinations. What changes from current corporate divisions of labor to a preferred future division of labor is that the variety of tasks each actor does is balanced for its empowerment and quality of life implications.
Balanced job complexes complete the task of removing the root basis for class divisions that is begun by eliminating private ownership of capital. Balanced job complexes eliminate not only the role of owner/capitalist and its disproportionate power and wealth, but also the role of decision-making coordinator who exists over and above all other workers. Balanced job complexes apportion conceptual and empowering and also rote and un-empowering responsibilities more equitably and in tune with true democracy and classlessness.
Next comes remuneration. In this new vision we receive for our labors an amount in tune with how hard we have worked, how long we have worked, and with what sacrifices we have made while doing our work. This is morally appropriate and also provides proper incentives due to rewarding only what we can affect, not what we can’t.
With balanced job complexes, for eight hours of normally paced work Sally and Sam receive the same income. This is so if they have the same job, or any job at all because no matter what their particular job may be, no matter what workplaces they are in and how different their mix of tasks is, and no matter how talented they are, if they work at a balanced job complex, their total work load will be similar in its quality of life implications and empowerment effects so the only difference specifically relevant to reward for their labors is going to be the duration and intensity of work done, and if we assume these are the same, then the share of output earned will also be equal. On the other hand, if duration of time working or intensity of work differ somewhat, so too will the share of output earned.
There is one very large step remaining, even to offering merely a broad outline of economic vision. How are the actions of workers and consumers connected? How do decisions made in workplaces, and by collective consumer councils, as well as by individual consumers, all come into accord? What causes the total produced by workplaces to match the total consumed collectively by neighborhoods and other groups and privately by individuals? For that matter, what determines the relative social valuation of different products and choices? What decides how many workers will be working in which industry producing how much? What determines whether some product should be made or not, and how much? What determines what investments in new productive means and methods should be undertaken and which others delayed or rejected? These are all matters of allocation.
Suppose in place of top-down imposition of centrally planned choices and in place of competitive market exchange by atomized buyers and sellers, in accord with extending the logic of our internationalism into our domestic economies, we opt for cooperative, informed choosing by organizationally and socially entwined actors each having a say in proportion as choices impact them and each able to access needed accurate information and valuations including each having appropriate training and confidence to develop and communicate their preferences. That would be consistent with council centered participatory self-management, with remuneration for effort and sacrifice, with balanced job complexes, with proper valuations of collective and ecological impacts, and with classlessness.
To these ends, global activists turning their attention to domestic economics might favor participatory planning, a system in which worker and consumer councils propose work activities and consumer preferences in light of accurate knowledge of local and national implications and true valuations of the full social benefits and costs of their choices.
The system utilizes a back and forth cooperative communication of mutually informed preferences via indicative prices conveying summary information about relative valuations and facilitation boards processing and communicating preferences and other data, rounds of accommodation to new information in which actors cooperatively negotiate with one another, and so on.
Thus the core of a new economic vision, parecon, that is consistent with the aspirations of anti-corporate globalization activism, is:
Democratic workplace and consumer councils for equitable participation
Diverse decision-making procedures seeking proportionate say for those affected by decisions
Balanced job complexes creating just distribution of empowering and dis-empowering circumstances
Remuneration for effort and sacrifice in accord with admirable moral and efficient incentive logic
Participatory planning in tune with economics serving human well being and development
The Implications of Parecon for International Relations
Now suppose we approach the problem of this chapter - the relations between a domestic parecon and international relations - from the opposite direction. What are parecon’s implications for international relations?
First, the pressure of capitalism to conquer ever expanding market share and to scoop up ever widening sources of resources and labor is removed. There is no drive to accumulate per se, and there is no tendency to endlessly expand market share or to exploit international profit-making opportunities, because there is no profit-making. The sources of imperialism and neo colonialism, not merely some of their symptoms, are removed, at least in the country with the parecon.
If the whole world has participatory economies, then nothing structural prevents treating countries like one might treat locales - neighborhoods, counties, states - within countries. And likewise, there is no structural obstacle to approaching the production side similarly, seeing the world as one entwined international system.
Whether this would occur or not, or at what pace, are matters for the future. It certainly seems to be the natural and logical international long-run extension of domestic advocacy of parecon. If balanced job complexes and equitable distribution in light of the total social output are morally and economically sound choices in one country, why not balance across countries and relate incomes based on effort and sacrifice to international output so as to attain international equity?
Likewise, if it makes sense to plan each country in a negotiated participatory manner, why wouldn’t it make sense to do that, as well, for interactions from country to country?
Of course, even with the structural obstacles emanating from capitalist relations of production gone, and even assuming cultural and political forms would allow, or even welcome, extending the logic of domestic parecons to a worldwide participatory economy, the remaining difficulty is the magnitude of the inter-nation gaps that would need to be overcome.
Even if one wanted to, one simply cannot sanely equilibrate income and job quality between a developed and an underdeveloped society, short of massive and time consuming campaigns of construction, development, and education. Moreover, if there are some parecons, and some capitalist economies, the situation is still more difficult, with gaps existing in development and also in social relations.
So the real issue about parecon and international relations becomes: as countries adopt participatory economies domestically, what happens to their trade and other policies with still capitalist countries?
No outcomes is inexorable. We can conceive, I suppose, of a country with a parecon that is rapacious regarding the rest of the world. It is difficult to imagine, yes, but not utterly inconceivable. What we are assessing is a policy choice.
How should a parecon interact with other countries who do not share its logic of economic organization and practice?
A good answer seems to me to be implicit in the whole earlier discussion of international global policies. The idea ought to be to engage in trade and other relations in ways that diminish gaps of wealth and power.
One obvious proposal is that the parecon trades with other countries at market prices or at parecon prices, depending on which choice does a better job of redressing wealth and power inequalities.
A second proposal would be that a parecon engage in a high degree of socially responsible aid to other countries less well off than itself.
A third proposal would be that a parecon supports movements seeking to attain participatory economic relations elsewhere.
There is every reason to think the workers and consumers of a parecon would have the kind of social solidarity with other people that would drive them to embark on just these kinds of policies…but such actions would involve a choice, made in the future, not reflect an inexorable constraint that is imposed on society by a systemic economic pressure.
The long and short of this chapter is that seeking just international relations leads, rather inexorably, toward seeking just domestic relations and vice versa. Parecon fulfills both agendas.