The Political Economy of Participatory Economics - by Michael Albert and Robin Hahnel
2 Workers' Councils We claim neither that conceiving and agreeing on the most appropriate arrangement
will be free of dispute within actual workers' councils, nor that any particular
arrangement will be universally applicable. The first point is simply that meetings
of workers' councils where each worker has one vote would be the final arbiter
just as stockholders' meetings where each owner votes as many times as shares
she or he owns are the final arbiter in privately owned enterprises. And the
second point is that in a situation where each worker has an interest in selfmanagement
and none has disproportionate power, it is not unreasonable to hope that workers'
councils will strive for decision making structures and ways to delegate authority
that accord with selfmanagement rather than establish hierarchies.1
But even procedures that poll council members in proportion as they are affected
may not ensure collective self-management. If some people hold authoritative
jobs while others only obey, even in formally democratic meetings people who
hold more authoritative and information-rich jobs will exert more influence.
Beneath formal democracy, a hierarchy of managers can still dominate deliberations.
Democratic councils,
therefore, do not by themselves ensure full participation. Additionally, the
organization of work must guarantee that all members of councils are equipped
to express their desires and opinions. Work Organization We know that not all work is equally desirable and that even
in formally democratic councils rote workers will lack the information, skills,
and energies to participate equally with conceptual workers. Democratic councils
help foster participation and equity but something must equalize daily work
assignments so the impact of people's work experience does not destroy equity
and self-management. If some have greater information and responsibility to
use to their advantage to dominate policy making, they can become a ruling "coordinator
class," both thwarting workers' participation and monopolizing desirable work
roles. The remedy is conceptually simple: If you work at a particularly unpleasant
or disempowering task, you should spend some time working at other more pleasant
or empowering tasks as well. Pleasant and unpleasant work, rote work and conceptual
or administrative work must be balanced. People should not do one type all the
time. To foster participation and equity people must be assigned to a balanced
mix of tasks. Which is not to say every person must perform every task in every
workplace. This is impossible and unnecessary. The same person need not work
as a doctor, an engineer, and a literary critic, and those who assemble cars
today need not assemble computers tomorrow. Nor should everyone who works in
a hospital perform brain surgery. The point is simply that people should rotate
in some reasonable time period through some sequence of tasks for which they
are adequately trained so that no one enjoys consistent advantages over others. However, we are not merely suggesting that doctors occasionally clean bed
pans or that secretaries attend an occasional seminar. Parading through the
ghetto does not yield scars and slinking through the country club does not confer
status. Short-term stints in alternative circumstances do not rectify inequalities
in basic responsibilities. Likewise, for those doing elite work in one workplace
to do rote work in another does not challenge mystification, deference, and
authoritarianism in either workplace. Only primary job complexes balanced
for desirability and empowerment can give all workers an equal chance of participating
in and benefiting from workplace decisions. Since disparate empowerment destroys participatory potentials and creates
class differences that in turn lead to inequity, we focus on empowerment without
implying that balancing to rectify differential desirabilities is not also important.
But balancing for empowerment is more complicated and solutions are also applicable
to balancing for equity. Likewise, for the reasons noted above, our initial
focus is each individual's primary responsibility. Is it a number of
different rote tasks, a number of different skilled tasks, or a combination
of diverse tasks in a single package balanced with others in the unit for empowerment?
Whereas capitalist and coordinator jobs combine tasks with the same qualitative
characteristics so that each worker has a homogeneous job complex and most people
do one level of task, in contrast, participatory jobs combine tasks into
balanced job complexes where everyone does many levels of tasks. Everyone
works at a particular bundle of diverse tasks, but all bundles prepare people
to participate as equals in democratic workplace decision making. While one might question the efficiency of organizing workplaces and industries
this way, it is certainly theoretically possible. Formally, for any economy
E: 1. We construct the set of all possible single types of productive activities,
{PA}. 2. We construct the subsets of "practically identical production activities"
of {PA}, {PIPA}i
where each member of each {PIPA}i
has essentially the same qualitative effect on workers as any other
member of that subset, and a different effect than any. member of any other
practically identical subset,{PIPA}j so that: i. The set of all practically identical activities subsets of {PA} constitutes
a partition of {PA}. The critical practical issue in creating this spectrum of subsets of activities
is how finely to measure "qualitative effects." If we measure too precisely,
each {PIPA}i will have only one element.
If -we measure too flexibly, each {PIPA}i will be huge. Both partitions
would be useless. In practice, experience and special evaluative boards would
settle this matter. In theory, there is no problem. 3. We construct the menu of available job complexes by combining different
productive activities from different subsets of practically identical production
activities to form balanced job complexes so that the menu of available job
complexes includes only offerings that incorporate a mix of tasks which together
have comparably empowering effects. In balancing job complexes within each workplace for equal empowerment, the
goal was to prevent the organization and assign ment of tasks within a
workplace from preparing some workers better than others to participate in decision
making. But balancing job complexes for empowerment within workplaces does not
guarantee that work life will be equally empowering across workplaces, any more
than balancing job complexes for desirability within workplaces guarantees that
working in different industries will be equally desirable. Establishing conditions
for a participatory, equitable economy requires overall balance in addition
to balance within each workplace. Clearly, to guarantee equal opportunity
to participate both within units and in the economy as a whole requires
internal as well as overall balance. Strictly speaking, overall balance for
desirability is sufficient for work equity. But since, in practice, this will
usually be easiest to achieve by arranging internal balance regarding desirability
and then correcting for differences between workplaces, the conclusion that
a participatory, equitable economy requires approximate internal and external
balance for both empowerment and desirability is a useful rule of thumb. The only way to balance for desirability and empowerment across workplaces
is to have people spend time outside their primary workplace. How can an economy
accomplish this? How can it calibrate balance? For that matter, how do people
come to work in one or another workplace in the first place? In a participatory economy, everyone will have the right to apply to work
wherever they choose, and every workers' council will have the right to add
any members they choose. We must wait until after explaining participatory allocation
to analyze when and why workers' councils would wish to add or release members,
but for now it is sufficient to know that once the plan is finalized, each workers'
council will have a list of openings for which all can freely apply. So any
worker can apply for any opening, and move to a new workers' council that wants
them should they prefer it to their present council. While this resembles traditional labor markets, much is different. Under traditional
labor markets people generally change employment to win higher pay or enjoy
more desirable working conditions. But if a participatory, equitable economy
balances job complexes across as well as within workplaces, and if equitable
consumption requires "equal pay for equal effort," people will be unable to
attain these traditional goals by changing workplaces. This is not to say people
will never change workplaces in a participatory, equitable economy. If a person
would prefer a different group of workmates, or working at a different combination
of tasks, she or he would have good reason to apply for membership in a different
workers' council. But to the extent job complexes are balanced, these personal
preferences will be the only motives to move, and, conversely, the freedom to
move will provide a check on the effectivneess of efforts to balance for equity
across workplaces. Higher pay will not be available by changing jobs, nor will
objectively better work conditions, since pay and conditions will be balanced.
Just as workers must balance complexes internally through a rating process,
so will delegates of workers from different councils and industries develop
a rating process to balance across workplaces. There will thus be "Job Complex
Committees" both within each workplace and for the economy as a whole. The internal
committees will combine tasks and assign work times to achieve balanced work
complexes within workplaces. The economywide committee will assign workers in
less desirable and less empowering primary workplaces offsetting time in more
desirable and empowering environments, and, vice versa, it will also assign
workers in more desirable and empowering primary workplaces offsetting time
in less desirable and empowering environments. The check on internal calibration
will be whether more members of a workers' council want one assignment or another.
The check on overall balance will be excessive applications to change workplaces.
Economywide committees will adjust rotation times to eliminate significant discrepancies
in people's applications to work in different workplaces. Creating balanced job complexes is theoretically possible. And if we combine
balanced job complexes with democratic councils, we would have nonhierarchical
production relations that promote equity and participation. But in practical
situations, could workers really rate and combine tasks to define balanced complexes
within and across plants? Provided we are talking about a social process that never attains perfection,
but does fulfill workers' own sense of balance, the answer is yes. The idea
is that workers within a plant would engage in a collective evaluation of their
own circumstances. As a participatory economy emerged from a capitalist or coordinator
past, naturally there would be a lengthy discussion and debate about the characteristics
of different tasks. But once the first approximation of balanced complexes within
a workplace had been established, yearly adjustments would be relatively simple.
If the introduction of a new technology changed the human impact of some task,
thereby throwing old complexes out of balance, workers would simply move some
tasks among affected complexes or change the time spent at different tasks in
affected complexes to attain a new balance. The new balance need not be perfect, nor the adjustments instantaneous, nor
would everyone need to agree completely with the result of a democratic determination.
As a matter of fact, individual preferences that deviate from one's workmates
would determine who would choose to apply for which balanced complexes.
If I am less bothered by noise but more bothered by dust than most, I will apply
for a complex whose rote component is attending noisy machinery rather than
a complex with a sweeping detail. Participation Versus Efficiency
We have argued that balancing work complexes for empowerment is a necessary
condition for guaranteeing all actors equal opportunity to participate in economic
decision making. But many believe that this would destroy efficiency. In our
own view, the relation between participation and efficiency will more likely
be positive than negative, but in any case it is more complicated than contemporary
"common wisdom" asserts. One prevalent view has it that some people make decisions better than others,
so that the only efficient arrangement is for them to make all important decisions.
In other words, participatory decision making is inherently inefficient since
it gives everyone decision making input proportional to the degree she or he
is affected even though some people make decisions better than others. Of course,
this was the same argument used to support the rule of kings against demands
for popular representation, the rule of "wise" and "benevolent" dictators against
demands for democracy, the rule of men against demands for women's suffrage,
and the rule of a "vanguard" party against demands for political pluralism.
Do those who accept the wisdom of universal suffrage, democracy, and political
pluralism do so at the expense of efficiency? Does some distinction between
political and economic decisions warrant popular participation in the former
but not the latter? Human beings have the potential to make conscious choices in light of our
understanding of the consequences of alternatives . Particular social environments
can subvert or suppress this potential in the majority as when political dictatorship,
patriarchy, dogmatic religions, slavery, and authoritarian education stifle
people's decision making potentials. But one important goal of desirable social
institutions is that they develop rather than thwart our most creative potentials.
If we assume that noneconomic institutions develop these potentials, and if
we choose economic institutions that do likewise, it is reasonable to assume
participants would be capable of making economic choices in light of predicted
consequences. This is not to assert that everyone is equally knowledgable about every decision,
or to deny a role for "expertise" in economic decision making. We often need
"experts" to interpret the consequences of choices and to explain the likely
implications of possible decisions. If experience shows a greater role for expertise
in economic decisions than in political or other decisions, so be it. But once
consequences are known because ordinary people have had the opportunity to hear
diverse expert opinions, what remains is for the affected people to register
their choices. While those with expertise in a particular matter may well predict
consequences more accurately, those affected know best whether they prefer
one outcome or another. In other words, making economic choices entails both
determining consequences and evaluating them. While efficiency
requires an important role for experts in determining complicated consequences,
efficiency also requires that those who will be affected decide which consequences
they prefer. Therefore, it is just as inefficient to keep those affected by
decisions from making them Still, there is a sense in which guaranteeing the conditions necessary for
establishing a fully participatory economy might be at the expense of efficiency.
If a specific skill is scarce-either because an essential innate talent is only
present in a fraction of the work force, or because training required to develop
the skill is time consuming for trainees or trainer and less pleasurable than
alternative human activities-then balancing work complexes for empowerment by
assigning someone with this talent or training to work at an activity that requires
a less scarce skill would be inefficient. Even so, assignments of this type
might be less inefficient than any humanly feasible alternative. For
example, 1. If always working at the same task proved so monotonous and boring that
people's concentration, effort, and performance deteriorated, balancing might
be more efficient than not balancing. 2. If failure to balance was deemed unfair, and resentment led to deteriorating
performance on others' part, it is possible for balancing to be more efficient
than nonbalancing. Besides a remarkable propensity not to consider these possibilities, the traditional
view of the relation between job-mixing and efficiency rests on questionable
assumptions regarding talent and training. In the traditional view, many productive
talents are assumed present in only tiny fractions of the population, while
most training is assumed terribly burdensome. Since doctors changing bed pans
is an example those opposed to job balancing like to cite, it is not inappropriate
to point out: 1. Ample experience demonstrates that it is possible to train only moderately
good students to become physicians, so the "talent" necessary to become a
doctor is apparently distributed among a rather large fraction of the population,
and the inefficiency of having doctors change bed pans could be greatly reduced
by training more doctors. 2. Protests of medical students aside, a substantial portion of medical
training could be highly illuminating and have a positive "consumption" component
so that the time occupied in the training process need not be as burdensome
as the AMA. would have us believe. 3. There is an implicit assumption that while it is inefficient for doctors
to change bed pans, it is not inefficient for others to change them. However,
while it is true that in societies where a large number of perfectly talented
members of the work force receive no training, the opportunity costs of having
them change bed pans are obviously less than the opportunity costs of doctors
doing so, this would not hold if everyone received ample training in some
area for which they had relevant talent. If all have their particular talents
trained, there would be significant opportunity costs no matter who changed
bed pans. As to whether it is more efficient for an economy to train all in
accord with their talents, or more efficient to train the productive talents
of only a few, the answer is obvious. A new technology is superior if it yields greater net social benefits
than existing ones. The simplest kinds of superior technologies use less of
some scarce input without using more of any other input, or yield more of some
desirable output without yielding less of any other output. These "pure input
saving" and "pure output enhancing" techniques are probably not the most common
superior technologies, although interestingly enough, new organizations of production
that increase opportunities for workers' participation can often be counted
among them. However, most new technologies use less of some inputs, but more
of others, or generate more of some outputs but less of others. In these cases,
whether the new technology is superior depends on whether the social cost of
the inputs saved outweighs the social cost of the inputs used, or whether the
social benefit of the outputs increased outweighs the social benefit of the
outputs lost. Whether the information available and incentives for those who choose technologies
in different kinds of economies can be relied on to lead them always and only
to implement superior techniques is, of course, of great concern. John Roemer
presents an interesting model in which capitalist economies fail to achieve
these goals whenever the rate of profit exceeds the growth rate.3
Moreover, numerous proponents of the "conflict theory of the firm" have suggested
that capitalists will not always choose superior techniques for reasons additional
to the one Roemer analyzed. 4
And we have clarified the logic of why capitalists, even under competitive
conditions, will reject superior techniques if they are sufficiently worker
empowering. 5
On the other hand, our analysis of coordinator economies concludes that
choice of technique in those systems will also be biased against worker empowering
technologies. 6
While the full explanation of why we believe our participatory economy
will implement superior techniques must wait until we present our allocation
procedure, it should be clear that there is no reason for workers' councils
to be biased against superior technologies because they are worker empowering!
Moreover, since the criteria of choice are different, there is every reason
to expect technologies developed in participatory economies to diverge from
those that have developed in capitalist and coordinator systems. Over time this
could dramatically improve the nature and quality of work life. It is important to note that nothing we have said implies that workers in
different workplaces must make decisions or organize job complexes entirely
alike. There will be a variety of ways workers can pursue the principles discussed
in this chapter, so that each participatory workplace will optimize within constraints
imposed by the allocation system, but according to the tastes of their own council
members. Differences in workers' preferences and leeway in the constraints on
council decision making will permit technologies and social relations
to vary from workplace to workplace. 1. For those familiar with
John Rawls' idea of an "Original Position" and his argument that those in such
a position would logically agree to the "liberty
principle"--maximum
liberty for each consistent with equal liberty for
all-we might point
out that the argument here is similar. 2. Those interested in the
details of how all this might be accomplished and what the result might look
like in different workplaces and industries should
see Albert and Hahnel,
Looking Forward:
Participatory Economics for the
Twenty First Century
(Boston: South End Press, 1991). 3. See theorem 4.9, John
Roemer, Analytical Foundations of Marxian Economic Theory (Cambridge:
Cambridge University Press, 1981), 102-3. While Roemer's model assumes one primary
input, homogeneous labor, we see no reason the problem he illustrates should
not obtain in more realistic settings. 4. For example, see Herb
Gintis, "The Nature of the Labor Exchange and the Theory of Capitalist Production,"
Review of Radical Political Economics 8, no. 2 (Summer 1976).
5. Theorem 8.1, Welfare
Economics. 6. Theorem
9.1, Welfare Economics. PRODUCTION
It is an abuse of words to apply the same term "discipline" to
such unrelated concepts as the mindless reflex motions of a body with a
thousand hands and a thousand legs, and the spontaneous coordination of
the conscious political acts of a group of men.
-Rosa Luxemburg
Now, as to occupations, we shall clearly not be able to have the same
division of labor as now: vicarious servanting, seweremptying, butchering,
letter carrying, boot-blacking, hairdressing, and the rest of it, will have
come to an end ... we shan't put a pattern on a cloth or a twiddle on a
jughandle to sell it, but to make it prettier and to amuse ourselves and
others.
-William Morris
If hierarchical relations of production and segregation of conceptual and executionary
labor are incompatible with economic justice, how can we organize work to be equitable,
to allow workers who are prepared and inclined to participate in decision making
to do so, and to ensure that all workers are prepared to partake
in making decisions as well as in carrying them out?
The first step toward establishing nonhierarchical work is to establish workers'
councils. Every workplace is governed by a workers' council in which each worker
has one vote. Smaller councils are organized for divisions, units, and work
teams as circumstances dictate. All issues are ultimately subject to majority
rule in the workers' council, but this does not preclude establishing more refined
procedures where different degrees of consensus make sense. In fact, forging
a workplace decision making structure that allows people to influence decisions
in proportion to the degree they are affected would almost always require more
refined decision making than simple voting since not all workers are equally
affected by all workplace decisions. By leaving decisions that only affect
a subgroup of workers to those workers and their councils, by assigning initiative
to those most affected by matters, and by weighing voting to reflect differential
impacts, democratic workers' councils would fashion their own best approximation
to self-management.
Balanced Job Complexes
ii. The subsets{PIPA}i can
be ordered along a spectrum of qualitative effects on workers ranging from
empowering to debilitating.
It is useful to note that we can learn much about the social relations, human
effects, and class structure of any economy by examining its menu of available
job complexes. Suppose, as in capitalism and coordinatorism, a few elements
of the menu of available job complexes combine tasks that all come from {PIPA}i
high on the empowerment spectrum, and most combine tasks that all come from {PIPA}i
is low on the empowerment spectrum. However talents among participants in the
economy may be initially dispersed, eventually a work force assigned roles from
this menu will divide into classes enjoying disparate decision making input and
receiving unequal rewards. Alternatively, if all elements from an economy's job
complex menu are equally empowering, even a work force that begins with disparate
decision making abilities will move toward nonhierarchical participation, the
hallmark of a truly participatory economy.
Balancing Across Workplaces
Balance in Practice
after experts have analyzed and debated consequences, as it is to prevent experts
from explaining and debating consequences of complicated choices before those
affected register their desires. In sum, for informed self-management,
there is no conflict between participation and efficiency.
3. If working at a complex including a number of tasks provides an overview
of how different tasks depend on one another thereby enhancing the intelligence
of people's efforts in their primary responsibilities, then even for the most
skilled balancing might be more efficient than not.
4. If performance is positively correlated with participation, and participation
is positively correlated with balancing, balanced complexes might prove more
efficient than unbalanced complexes.
In sum, the "scarce talent" argument against balancing job complexes hinges on
the assumption that a great deal of the work force has no trainable talents, while
the "training cost" argument against balancing for empowerment ignores the fact
that training can be quite enjoyable. Moreover, the claim that balancing is necessarily
inefficient also ignores a number of ways in which balancing may improve performance
that should be weighed against any opportunity costs that may exist.
In any case, we do not claim there are never opportunity costs to having people
work outside their area of comparative advantage. We only claim that the case
against balancing on efficiency grounds has been greatly exaggerated. In a society
that provides all with appropriate training delivered in the most enjoyable rather
than most distasteful ways, the opportunity costs of arranging job complexes with
balanced empowerment are not likely to be anything like what opponents claim.
Any losses in efficiency should be weighed against the importance of participation
and reductions in coercive management needed to extract effort from recalcitrant
"underlings."
Equity Versus Efficiency
We believe: (1) an equitable economy requires that people's work experiences
be equally desirable, and (2) an equitable economy can be fully efficient. However,
some economists dispute the conclusion that equitable means equal, and even among
those who agree that equitable means equal, many believe an equitable economy
must be inefficient due to lack of "material" incentives. Since the debate over
what constitutes an equitable system of rewards, and the debate over the relation
between "material" incentives and efficiency are the same whether we are talking
about more desirable work conditions or greater consumption opportunities, we
defer this issue to chapter 3 where we explore the meaning
and consequences of insisting on equitable consumption opportunities. The conclusions
we reach regarding equity and efficiency in consumption apply as well to equity
and efficiency in work.
Information and Incentives
We would like workers to govern their activities in light of the full social costs
of preparing the inputs they use, the social benefits of the outputs they make,
and the costs in their time, energy, and the like, of doing the work. This entails
evaluating a great deal of both qualitative and quantitative information. And
while workers can best estimate the human effects of different options on themselves,
the qualitative and quantitative consequences for others are not something we
can expect workers to either know or respect unless the allocation system provides
the necessary information and incentives. We argued in chapter
1 that neither central planning nor markets provide the necessary information
and incentives for workers to make socially responsible decisions. Whether or
not our allocation system will provide means and incentives for workers' councils
to, make decisions according to the criterion of overall social costs and benefits
remains to be seen.
Choice of Technology
Diversity