The Primary Determinant: Need, Not Profit and Market Forces

In a satisfactory society the basic economic priorities must be decided by discussion and debate and deliberate, rational decision. Chapter 10 emphasised that market sys­tems cannot meet the most urgent needs or produce just or ecologically sustainable development, because they inevitably allocate resources to the highest bidder. It is axiomatic that if there are to be sustainable and just outcomes in the coming situa­tion of intense scarcity, the basic economic processes will have to be under social control. If they are left to market forces then the rich will quickly take everything of value through their superior purchasing power and there will very likely be rapid descent to a new feudalism, soon followed by terminal chaotic breakdown.

However, in the near future we might choose to leave much of the economy as a form of private enterprise carried on mostly by small firms, households and cooper­atives… under the umbrella of social control. Market forces might be allowed to operate in many relatively unimportant sectors. For example the kinds of bicycles on sale might be left entirely to the market. Local market days could enable individuals and families to sell small amounts of garden and craft produce. In other words mar­ket forces might be allowed to make most of the economic decisions – but none of the important ones! They would never be allowed to settle the distribution of income, basic development issues, access to livelihood or the way the environment is treated.

In the present economy the notion of having firms under social control is taken to mean big centralised bureaucracies and states. These can be entirely avoided by devolving most of the control to small localities where citizens can deal with issues through direct and participatory procedures. Again, because local conditions and resources, skills and traditions are the important factors determining how local economies can best function, local people are the ones who are familiar with these and they are in the best position to make the decisions most likely to satisfy local needs. It will make no sense for distant governments to decide what is best for your town to plant when another of its parking lots has been dug up. Thus the form of social control envisaged here has nothing to do with “big-state socialism” as social­ism is usually conceived and has mostly been practised. What we must strive for is a radically participatory democracy. Without this the town will not arrive at deci­sions that work.

In making these decisions, communities can take into account all relevant moral, social and ecological considerations, not just dollar costs and benefits to those with capital or to purchasers. If a development would be costly and “inefficient” but ecologically important or good for the town, we could still opt for it. If a firm was struggling, or becoming inefficient we would not let market forces dump those workers and owners into unemployment, although we might need to phase out the firm. We would have to grapple with finding the best rearrangement for the town, knowing that if we don’t, then the town will be weakened.

Our chances of running our local economies satisfactorily will be increased by the fact that they will be far less complex than present economies. There will be less producing and consuming, there will be no growth, there will be no interest payments (if there is interest there is growth) and there will only be a small finance sector. As time goes by people will increasingly come to see the economy not as the arena where all compete for as much wealth as possible, but as the system we maintain for rou­tinely providing us with those relatively few goods and services we need in order to live well while we get on with important things like rehearsing for our next festival.

It is conceivable therefore that early in the transition process much of the econ­omy will still be made up of private firms but as time goes by we will see the sense of reducing and eventually eliminating the role for market forces as we develop more satisfactory ways of ensuring efficiency and innovation. Many firms might remain privately owned, but serve the town under the watchful but helpful eye of its citizens. A key assumption here is that efficiency, “work” motivation and innova­tion can eventually come from a) the good will of citizens who understand the importance of contributing to their local economy and find that enjoyable, and b) via extensive monitoring and feedback and adjustment systems, rather than mar­ket forces. Crucial for this would be the development of elaborate systems (which might be run mostly by volunteers), constantly making clear how well various agencies, including firms, were performing and what innovations seemed desirable. These monitoring systems would also focus on indices of social cohesion, quality of life and footprint, and would be in touch with similar agencies and information sources all around the world.

There are only two ways of determining what happens in an economy. Either a society tries to determine outcomes via rational, deliberate processes, which can vary between authoritarian-totalitarian and participatory-democratic, or it is all left to market forces. The second option allows your fate to be determined by what will maximise the wealth of the richest few and a glance at the state of the planet shows where that option is taking us.

If the transition gathers momentum it is likely that people will in time come to see that there is no need for the remaining elements of the market system. To retain any element of the market system is to retain forces which generate and reinforce self­ishness, inequality and injustice, and more important it is to subvert the crucial col­lectivist values on which our survival will depend. In the long run economic success will cease to be important to people, because it will have diminishing significance for their quality of life. That will derive mainly from the spiritual and ecological wealth of their community, and how well people get together to provide for their collective welfare. Obviously none of this is possible without immense cultural change (… which of course might be too difficult for us.)

Updated: October 27, 2015 — 12:08 pm