Sunday, January 29, 2012

America towards cooperativism

Book Review of America Beyond Capitalism by Gar Alperovitz

If I were to propose a way to put the United States, and the rest of the world, on a path towards a sustainable economy and a liveable, humane, and vibrant society, I would begin like this: First, I would nationalize the media, revising the constitution to institute the media as a democratically-controlled, de jure fourth branch of government. I'd then turn to the nationalization of the banks, energy companies, and all other natural monopolies, creating a democratic governing structure for nationalized industries equally responsive to their workers and the public at large. Then I'd cut the military by 80% or so, re-purposing "defense" companies with government contracts to build a sustainable energy infrastructure, and a sustainable agriculture system. Maybe then I'd focus on democratizing university governing structures while increasing funding both to eliminate tuition fees and to equip them to produce far more graduates with advanced degrees to form the core of a massive increase in adult education nation- and worldwide. Oh, and then there's the matter of instituting maximum work weeks and work-sharing requirements, to both increase free time and eliminate unemployment.

Unfortunately, taking a flight of fancy such as this soon puts one in the position of a Wiley E. Coyote, pausing and looking down to realize that he has left the ground beneath him a while ago, and is now hundreds of meters above the floor of a canyon. As one plummets down, reality becomes clear: the next presidential election will be between a Mormon private equity capitalist and a milquetoast reformer with the daring of an ostrich and a big crush on financiers. There. Is. No. Hope.

But then comes a book written by someone with over half a century's worth of experience with social change, to say: "those who say that nothing can be done because reactionaries control everything simply do not recall or do not know how impossible the world felt before the 'unexpected' explosions of the 1960s." Well - that is me. "Those who tell me the opposition to change, now, is so great that nothing can be done would do well to read just a bit about what it was like before the civil rights movement was a movement." Touché! OK, old man - whaddya got?

For one, he's no googly-eyed optimist, ignorant of just how fucked we currently are: "[c]ontributing to both the relative and absolute trends during much of the final quarter of the twentieth century was the fact that hourly wages of the bottom 60 percent did not rise as fast as inflation - with the result that the real income each person earned, hour by hour, was actually lower in 1995 than in 1973. For very large numbers of Americans, the only reason total family income rose - very modestly - was that people worked longer hours and/or spouses (mainly wives) went to work in increasing numbers. ... [M]any would have been better off if the economy had simply stood still at the 1973 level."

Check. But what to do about it?

That's coming. But first, Alperovitz demonstrates that the recognition that our economy is structured in an absolutely insane way is not exclusive to the Left. In fact, some of the most interesting parts of the book lay out the thoughts of older conservative economists and political theorists, which demonstrate that many of the core values of the Left may be shared more broadly than one might think. For instance:
"The 'Chicago school' conservative economist Henry C. Simons analyzed the underlying logic of [concentrated corporate] power and came to the conclusion that 'regulatory strategies' involved the worst of all solutions. Even public ownership was better, he felt - even from the perspective of free-market economic theory. At least it provided for public disclosure of information and open oversight. The state, Simons proposed, 'should face the necessity of actually taking over, owning, and managing directly ... industries in which it is impossible to maintain effectively competitive conditions.' Likely candidates included railroads, 'utilities, oil extraction, life insurance, etc.' For similar reasons Simons suggested that it might make sense for metropolitan governments to 'acquire much or most of the land in their areas.'"
Sure hasn't hurt Singapore.

But this is just one of the interesting asides in the book. The heart of the book is a revealing, surprising, and heartening description of how much progress has already been made, under the radar, in a staggering variety of cooperative, municipal and employee-owned enterprises. To provide just one example:
"In general, ESOPs [employee stock ownership plan-having companies] have been found to be as productive or more productive than comparable non-ESOP firms. Annual sales growth, on average, is also greater in ESOP than in non-ESOP firms. When ESOPs are structured to include greater participation, however, the advantages of worker ownership increase substantially. Studies [...] all confirm that combining worker ownership with employee participation commonly produces greater productivity gains, in some cases over 50 percent."
And this is just one example of hundreds that Alperovitz provides of a country experiencing the development of a substantial cooperative sector within an otherwise dog-eat-dog capitalist economy. As opposed to my flight of revolutionary fancy above, Alperovitz's vision is a piecemeal, ground-up process of continual development and improvement. His idea, it seems, is that the cooperative sector can grow to such an extent that its existence, and viability, will become apparent on a national level. And, when the next economic crash comes (just give the financial sector a little more time), the idea of cooperativism will be prominent enough that it will form the paradigm the federal government will have to turn to in reforming and rebuilding the economy.

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