Sure, that’s the point of the system from the point of view of the capitalist. But why not a free market system set up to benefit the customer and laborer, while removing the influence and profit of the capitalist as much as possible? The capitalist might not care (and with a few exceptions it seems that they mostly don’t) about their customers or laborers. But surely the customers and laborers care about themselves. That seems to me like it should incentivize them setting up a system where the capitalist (who really does seem to me to just be a middleman) is relegated to being just another laborer whose output happens to be making the connection between the customer and the laborer who does the actual production of a good or service. What I’m trying to figure out is why a system like that has failed to come about in real life.
My guess, based on my own experience, is that a large chunk of labor think of themselves as temporarily embarrassed capitalists, who would surely not want to replace a system that would benefit them once their luck turns around. I of course would disagree with them about the accuracy of that perception. That’s my best guess as to why it hasn’t been tried, but I’m not an economist, and I’m just hypothesizing about things that seem obvious but turn out to be incorrect.
I don’t think it does. The most essential work — getting people fed and child care and cleaning and so on — is often very poorly paid, while less essential work is often paid better, and as you point out work that does damage instead of providing benefits sometimes pays quite well.
The question is, will that leave the people genuinely unable to work in serious poverty, getting barely enough to get by? Are they to be condemned to living in barracks, eating only the cheapest foods that will keep them healthy, having minimal furniture and clothing, with no pets to feed or take to the vet? That’ll give an incentive for people to take minimum wage jobs, all right. But it seems a hell of a price to pay for getting old or getting sick or being born sick.
Standard capitalism has that problem too, of course.
“To each according to their needs, from each according to their ability” doesn’t, in theory. As has been pointed out, it doesn’t work in practice in groups of any significant size; and it doesn’t always work in small groups. Any properly functioning family works like that — nobody expects the little kids or the very aged or someone who’s ill or otherwise incapable to do much or any work, but they get taken care of and live the same general lifestyle as the healthy adults. But even on that scale some families get taken over by assholes. It’s probably the scale we evolved to live in, though — small groups mostly related one way or another, hooked into much larger networks for trade of items, knowledge, and genetics but mostly dealing with people we knew well. I’m not sure if the species is going to survive long enough to evolve to deal with our current population levels.
I will add in here that most people actually want to work at something. While sitting on one’s butt doing nothing may seem ideal for a while to people who have been overworked and/or have been working at jobs set up to be crappy, I’m pretty sure there’s only a small percentage who will do that for very long. If the minimum level of sustenance is made to be comfortable, then the minimum wage jobs will need to be set up so that they’re not crappy jobs. Considering the really wide range of things that people will do as a hobby, I think that’s possible. But it would take a major revamping of society; especially because a lot of the issue is an issue of respect.
This is the part tripping you up in two ways. First, capitalists, which Marx called the bourgeoisie, aren’t middlemen, and second, middlemen aren’t dismissible; they are vital.
The role of middlemen - traders, shippers, money changers, record keepers, etc. etc. - go back to the earliest days of cities. They were and are the oil in the machine of commerce; without them everything grinds to a halt.
You, like Marx, are dividing commerce into two classes and saying that one is a oppressor and the other does all the work. That has never been true at any time. Inventors, scientists, bankers, insurers, academics, all the professions create valuable assets to a society, that are difficult or impossible to value in strict terms. How would one compare a scientist whose basic research pays off 40 years later and changes society with someone who invents a better mousetrap that is useful tomorrow?
Marx’s 19th century London could be slotted more easily into evil factory owners and virtuous factory workers, although even that was a minor slice of the entire British economy. Extrapolating off that to any other set of conditions was a failure; economies are too complex for two classes. Stalin tried, in a still mostly pre-modern country, to apply Marx’s classes to evil kulaks - wealthy landowners - and virtuous farmers, and then undercut the role of the farmer/workers by collectivizing their output, sending it to the state and leaving nothing for them. That’s about as opposite to what you’re proposing as an post-Marxian economy can get.
Modern American society doesn’t run in any way compatible with your proposal either. We live in a service economy totally dominated by middlemen. Amazon and Google, e.g., are middlemen enabling ordinary consumers’ access to nationwide and global commerce. The systems themselves create the value, much more so than individual workers, and this is shown by the way large middlemen companies hire vastly fewer workers per unit of revenue than factories ever could. Trying to retrofit an obsolete hierarchy onto today’s economy instantly shows the giant holes in the concept.
By definition, a system in which customers and workers made all the decisions would not be capitalism. The reason we don’t have such a system is that the system we do have was imposed on people by force and violence, starting with the separation of peasants and workers from the land and control over production. 400 years later, we have all become habituated to believe it is the only possible, viable system, just as earlier societies believed in the divine right of kings. And force and violence are still used to maintain the system and to disrupt and destroy alternatives when they spring up. Whatever negative things existed in Cuba were unquestionably made much worse by the actions of the US, for example; other examples abound. That has a chilling effect on people who might want to pose the same questions you do.
In the middle of this system, it is also very hard to create and maintain the co-ops and collectives and democratic enterprises you’re talking about. My own experience in a collective bakery was we had little money, our business model was not a good risk by the rules of the bank (“No boss? I don’t think so!”) so funding for equipment, advertising, etc., was really limited. It required long hours and less pay than if we’d all gone to work at a bakery. Nonetheless, it lasted for 15 years.
Today, 8% of Italy’s GDP is generated by co-ops and collectives. It is typically easier to set up such enterprises there than in the US or Canada, with some government assistance available. They also tend to be created in areas and sectors where the private enterprise (capitalist, for profit) model has failed. Local water supply systems are one example where people just got sick of the terrible results of the private system and set up their own. Mondragon in Spain is a collection of collectives that currently has about 75,000 people in it, running businesses ranging from retail to actual production.
To your point that the capitalist could be considered a middleman, I’m not sure what you mean by capitalist. Someone who supplies capital and expects a return on the investment? Someone with specific management skills or facilitation skills? Sales people? These are very different functions and some could indeed be simply another job, paid a decent wage, rather than “boss who also takes out a lot of money unrelated to the effort he puts in.”
So you’re on to something, and there are some examples of success!
“Economic production” doesn’t do or regard anything. It is a human activity wherein human labour is applied to nature to produce the goods and services we want and need. There are many examples of different kinds of economic production, based on different principles, methods, aims, and rules, designed and participated in by humans.
Marx never argued there were only two classes, only that “modern capitalism” (not a phrase he used) tended more than say feudalism or slavery to divide people into two classes. Indeed, he noted that the “modern” corporation needed an expanding middle class of engineers, managers, etc. Ditto the other occupations you list. But I think it is the case that many of those “inventors, scientists, bankers, insurers, academics, all the professions” are more and more employees of large corporations and organizations that are run like corporations, and so have less control over their work and are bound more and more by the logic of capitalism rather than free and independent producers. My dentist and doctor are employees in corporations, unlike the independent dentist and doctor of my youth. Universities hire part-time faculty to teach for very low pay; the engineer and lawyer work for large corporations more and more.
Stalin’s actions were as deplorable and evil as those of the English capitalists he learned them from, without a doubt. Neither has anything to do with the model FliktheBlue is suggesting. Their suggestion is, “could we create an economy that was run more democratically and distribute wealth and goods and services more equally?” The answer is 1) we absolutely can 2) while it seems to be the case that it is easier to imagine the end of the world than the end of capitalism, if we don’t start working on this, we’re doomed.
I recently mentioned this in another thread. If you have a centralized economy, you have decisions being made by a small group of people at the top. (In Stalin’s case, that group was effectively Stalin himself.) A person can only do so much work in a day. So the total amount of decision making and organizing that can be done by a few dozen people is relatively small.
In a free market economy, you have thousands of people making decisions and organizing things. They are collectively doing a lot more than the rulers in the centralized economy. Granted, some of this work is duplicating what other people are doing and some of it is being used wrongly. But the volume of the work being done is much greater than what the centralized system is doing, even when you subtract the non-productive work.
Another problem with Stalin’s version of communism was Stalin’s penchant for punishing errors. If you made a mistake, you might be severely punished. So people were afraid to take risks. And a good economy needs to take risks and try out new ideas, even though many of those new ides won’t work out. Trying them out is the only way you’ll discover new ideas which do work. An economy where everyone is afraid to risk trying something new is going to stagnate.
Because the company has expanded, for instance? Or people expect it to expand in the future? Or because another company is thinking of acquiring it for cash?
There are many, many examples of companies that make no profit and yet have high stock prices.
This is of course also true of corporations and especially large, virtually monopoly, corporations. The parallels of Soviet management and capitalist management have long been noted.
The question you leave out is “what is the pathway from here to there?” I don’t see any path at all to the OP’s world.
I also believe that “an economy that was run more democratically and distribute wealth and goods and services more equally” is necessary. I also think it is possible. But that society would be a modification of our world, and not a utopia built from scratch.
So we are all agreed on where we want to go! That’s great! Now we can get to work and start figuring out how we get there. I suspect there are many different paths and that it will take time, but at least we’re all pulling in the same direction now.
This 1) is a grossly over-optimistic appraisal of typical family dynamics and 2) has nothing to do with whether we can organize enterprises and communities on a much more democratic basis than we do at present. As noted above, Mondragon in Spain manages to coordinate 75,000 people in a variety of enterprises, all of them much more democratic than any US corporation.
There are many varieties of “socialism,” and only a few advocate command economies of the nightmare types represented by the Soviet Union and Maoist China. Even those that do do not attribute “global wisdom” to the leaders so much as argue that a planned economy can offer efficiencies and more equality than a relatively unplanned capitalism. For the record, this is not my position or that of FliktheBlue.
As for the argument that a market lets us vote with our dollars, as it were, this is inherently an undemocratic system that replaces one person, one vote with one dollar, one vote. There is a great deal of force inherent in this system (cue Monty Python peasants!); as the old song says, “the whip that drives me onward is my family must eat.” While the naked force of the state is largely held in abeyance, unlike the Soviet and Maoist models, the reality for many is a far cry from democratic control of what to buy and how to influence the board of directors when they decide to produce Labubus instead of bread. And the reality is, for millions in the Soviet Union and China, those command economies offered more than capitalism in the aftermath of decades of invasions and wars. Let’s not forget that those economies regularly outpaced “the West” in growth and expansion, as China continues to do today.
And again, I’m not calling for Soviet-style anything. Heck, I haven’t even forgiven them for Laika. I’m merely suggesting things are a little more complicated than we typically imagine.
How did your co-op deal with the Iron Law of Oligarchy– that the emergence of a specialized managerial class seems inevitable?
And yet at the end of the day some things just work and others do not. Lenin, Stalin and Mao thought that they could by fiat redefine what work was worthwhile by simply indoctrinating people to regard it as so, irrespective of physical reality.
we were all familiar with the work of Robert Michels, had training in democratic decision making, talked things out, and had no “executives” empowered to make binding decisions on the group.
Capitalists, while relying much less on brute force, though never forsaking it, also indoctrinate people into thinking what work is worthwhile, who gets to direct it, and where profits go. They are backed up by the power of the state, ranging from law to the police to the courts to education. And they have a great deal of control over the “public” discourse through control of media and advertising.
The power of capital, as Adam Smith noted, is precisely the power to command the labour of others.
As for some things just “working,” the questions of “work for whom, in what way, to what end?” must always be asked, and as in so much else, our mileage may vary based on our experiences, values, ethics, and politics. Like you, I see many problems with capitalism and “the west.” I think many of them are “the way the system works” and that benefits some much more than others. It is how the system was designed and implemented. I also think we can do better, and for me, that means thinking about expanding democracy greatly, to encompass how decisions around work and production and the economy are made. From your writing here, it seems we are somewhat agreed that more democracy is better than less. We may be arguing over how much is desirable and possible.
China did figure it out… After Mao and millions did die. As Sarah Payne can tell you, (Youtube video, recommended to check the basic errors that dictators do)
The problem with the Communist Party, the paradigm of we’re going to have a monopoly, it’s a route to poverty. Think about it. When the communists took over, they didn’t restore the grain harvest that had happened during the Civil War. The 1930s version until after Mao was dead, it’s incredible.
It’s a really lousy system for promoting economic growth, and it matters in a poor country. It’s going to determine your per capita standard of living. And the poorer you are, the more that makes a huge difference to you to have somebody say. Communism doesn’t produce wealth. It’s an incredibly effective way for taking power within a failing state and putting a dictatorship in power. It’s incredibly good at that. But it doesn’t deliver prosperity afterwards.
(Sarah C. M. Paine is William S. Sims University Professor of History and Grand Strategy in the Strategy & Policy Department of the U.S. Naval War College.)
It’s only a minor hijack, and could be relevant, so I’ll bite. My impression is that Cuba went wrong for the same reasons that Venezuela, North Korea, and many others throughout history have gone wrong. That is because Castro was an authoritarian asshole who was only interested in propping up his own regime and maintaining power as the supreme leader rather than doing the right thing for the Cuban people. That sounds like a simplistic conclusion, but I’d bet it’s biggest contributing factor.