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Making Democracy Economic
The following is excerpted from "An ‘excess of democracy’: what two generations of radicals can learn from each other".
[F]rom the 1980s, at the same time as attacking the trade unions, corporate management was also dismantling the military-style hierarchies characteristic of many leading companies and decentralising the production process. A new generation of managers, especially in the newer industries, was recognising that workers’ tacit knowledge was a rich source of increased productivity and greater profits – so long as workers had little real power over their distribution.
Another example is how, in the endless search for new markets, culturally-savvy marketing managers were able to identify and exploit the commercial opportunities in the expanded horizons and wants of the increasing mass of women with incomes of their own.
The key underlying feature of these and similar trends is that much of the innovative character of capitalism’s renewal in the 1980s and 1990s – underpinned by the expansion of credit – came from sources external to both the corporation and the state. In fact, frequently its origins lay in resistance and the search for alternatives to both.
In other words, capital proved very much more nimble in responding to – and appropriating – the new energies and aspirations stimulated by the critical movements of the 1960s and 1970s than did the parties of the left – for which these movements could have been a force for democratic renewal.
Now, with the credit that underpinned the apparent ebullience of this particular period of capitalism having become toxic, the search for alternatives is back. As I write, the Financial Times, much to its own astonishment, is publishing a week of articles on 'The Crisis of Capitalism'. The opening article declares that 'at the heart of the problem is widening inequality'.
Are we seeing in the combination – not necessarily convergence – of unease within at least the cultural elites, the growth of sustained popular resistance and public disgruntlement, the emergence of what Karl Polanyi called a ‘counter-movement’ to the socially destructive consequences of rampant capitalism? And to what extent might the ideas of the movements of the 1960s and 1970s influence the character of that counter-movement?
A fundamental break
To answer this we need, briefly, to remind ourselves of the core nature of the original social critique made by the 1960s/70s movements and in particular the nature of its potential break with the institutions of the post-war order: their paternalism, their exclusions, their narrow definition of democracy and their assumption that production and technology were value neutral.
Central to the character of this critique was its aspiration, more in practice than in theory, to overcome the debilitating dichotomies of the cold war: between the individual and the collective/social; freedom and solidarity/equality; ‘free’ market versus ‘command’ state – dichotomies that were refrozen through neoliberalism and the manner of the fall of the Berlin Wall.
The ideas and practices of the women’s movement are particularly illustrative. This movement came about partly from the gender-blind inconsistencies and incompletely fulfilled promises of the radical movements of the time. It deepened and extended their innovations, adding insights arising from women’s specific experiences of breaking out of their subordination.
Especially important here was an insistence on the individual as social and the collective as based on relations between individuals: a social individualism and a relational view of society and social change. After all, the momentum of the women’s liberation movement was animated both by women’s desire to realise themselves as individuals and their determination to end the social relationships that blocked these possibilities. This required social solidarity: an organised movement.
The nature of its organisation was shaped by a constant attempt to create ways of organising that combined freedom and autonomy – what every woman struggles for in her own life – with solidarity, mutuality and values of equality. The result – cutting a complex and tense story short – was ways of relating that both allowed for autonomy and also achieved co-ordination and mutual support, without going through a single centre. In other words, here was what could be called an early, pre-ICT [information and communication technology], 'networked' form of organisation.
The political economy of networks
This networked form was distinctive because integral to its origin, character and sustainability were values of solidarity and equality and democracy. Awareness of these origins could help us now, when networked organisations are everywhere, to distinguish between the instrumental use of the concept of network in essentially undemocratic organisations (within states and corporations, for example) and, on the other hand, as a way of connecting distributed activities based on shared values of social justice and democratically agreed norms.
The latter possibility is radically enhanced through the new information and communications technology in its non-proprietorial forms. The new possibilities of systems co-ordinating a multiplicity of autonomous organisations with shared values, through democratically agreed norms or protocols, can help upscale economic organisations based on non-capitalist – collaborative, P2P (peer to peer) co-operative or other social and democratic – forms of ownership, production, distribution and finance.
What enables us to make this apparently surprising leap from the forms of organisation shaped by the consciousness-raising groups of the women’s movement (or indeed other civil society initiatives of the same period, such as the factory shop stewards’ committees combining against multi-plant, multinational corporations and developing alternative plans for socially useful production) is the importance they give to practical, experiential knowledge and the need to share and socialise it.
The political economy of knowledge
The reason why this is important for the development of a political economy beyond capitalism is that behind the imposed choice between capitalist market and the state is the polarisation between scientific, social and economic knowledge on the one hand and practical knowledge on the other. While the former was regarded as the basis of economic planning and centralised through the state, defenders of the free market held up the latter as being held individually by the entrepreneur and capable of coordination only through the haphazard workings of the market, based on private ownership. The relevant breakthrough of the women’s and other movements of the 1960s/70s was to make the sharing and socialising of experiential knowledge – in combination with scientific forms – fundamental to their purposeful, but always experimental, organisations. And to do so through consciously co-ordinated/networked and self-reflexive relations between autonomous/distributed initiatives.
Translating this into economics in the age of information and communications technology – a project requiring much further work – points to the possibility of forms of co-ordination that can include and help to regulate a non-capitalist market. A regulated, socialised market, that is, in which the drive to accumulate and make money out of money is effectively suppressed. It also provides a basis for democratising and, where appropriate, decentralising the state, within the framework of democratically agreed social goals (such as concerning equality and ecology).
It is over these issues concerning the sharing of knowledge and information and the implications for the relationship between autonomy and social co-ordination that the ideas coming from the Occupy movement can creatively converge with those of earlier movements. It is interesting in this context to read the economics working group of Occupy London describing in the Financial Times how Frederick von Hayek, the Austrian economist and theorist of free-market capitalism, with his ideas on the significance of distributed knowledge, is 'the talk of Occupy London'. No doubt this was partly a rhetorical device for the FT audience. But the challenge of answering Hayek and his justification of the free market on the basis of a theory of distributed practical and/or experiential knowledge does provide a useful way of clarifying for ourselves the importance of the networked social justice initiatives of today and the anti-authoritarian social movements of the past for an alternative political economy.
There is a point at which Hayek’s critique of the ‘all knowing state’ at first glance converges with the critique of the social democratic state made by the libertarian/social movement left in the 1960s/70s. Both challenge the notion of scientific knowledge as the only basis for economic organisation and both emphasise the importance of practical/experiential knowledge and its ‘distributed’ character. But when it comes to understanding the nature of this practical knowledge and hence its relation to forms of economic organisation, these perspectives diverge radically.
Whereas Hayek theorises this practical knowledge as inherently individual and hence points to the haphazard , unplanned and unplannable workings of the market and the price mechanism, the radicals of the 1960s/70s took, as we have just explained, a very different view. For them, the sharing of knowledge embedded in experience and collaboration to create a common understanding and self-consciousness of their subordination and of how to resist, was fundamental to the process of becoming a movement. In contrast to the individualism of Hayek, their ways of organising assumed that practical knowledge could be socialised and shared. This led to ways of organising that emphasised communication and shared values as a basis for co-ordination and a common direction. It provided the basis for purposeful and therefore more or less plannable action – action that was always experimental, never all-knowing; the product of distributed intelligence that could be consciously shared.
At the risk of being somewhat schematic, it could be argued that the movements of the 1960s/70s applied these ideas especially to develop an – unfinished – vision of democratising the state. This took place both through attempts to create democratic, participatory ways of administering public institutions (universities and schools, for example) and through the development of non-state sources of democratic power (women’s centres, police monitoring projects and so on). It involved working ‘with/in and against’ the state, such as when the Greater London Council was led by Ken Livingstone in the early 1980s.
Today's movements are effectively focusing their energies especially on challenging the oligarchic market, and the injustice of corporate, financial power. Here the development of networked forms are increasingly linked to distributed economic initiatives – co-ops, credit unions, open software networks, collaborative cultural projects and so on. In this way, today's movements are beginning to develop in practice a vision of socialising production and finance and creating an alternative kind of market, complementary to the earlier unfinished vision of democratic public power.
What they have in common, more in practice than in theory, is an assertion of organised democratic civil society as an economic actor, both in the provision of public goods and in the sphere of market exchange.
[...]In sum, my arguments point to the importance of the unfinished foundations in democratic civil society of an alternative political economy – including a different kind of state. You could say we were rudely interrupted in our work. But maybe, as we join with new generations with capacities and visions way beyond our own, we will be collectively stronger if we recover what was potentially powerful and what the elites feared and tried to destroy.
It’s not easy to sum up succinctly what the managers of the ruling order felt so threatened by in the 1960s/70s, so let’s use the words they employed themselves. It was ‘an excess of democracy’ that lay behind ‘the reduction of authority’, concluded the Trilateral Commission when it investigated the causes of the political and economic crises of the early 1970s on behalf of governments of the dominant western powers. The elite alarm at that time was thus more than just the regular ruling class fear of the mob. The notion of ‘an excess of democracy’ implied a fear of intelligent and organised opposition, which was hence less easy to counter.
It was the autonomous and yet purposeful, organised and capable nature of the movements - including, perhaps especially, in the workplace that they feared most. Here was the emergence of a new generation with allies throughout society that no longer accepted the place allotted to them by the elite democracy handed down to them after the war. And yet that generation comprised the children of the post-war democratic order, gaining legitimacy through appealing to its claims and its unfulfilled promises. At that moment, the elites lost their authority. Simple repression would no longer work – not that they didn't try it.
Related to this and later on, as the ideas of the radical movements began to shape political debate in the mid-1970s and early 1980s, the threat, at least in the UK, became that a form of socialism (or at least a viable political vision threatening to the elites) might emerge that could no longer be dismissed by reference to the failure of the Soviet model. Norman Tebbit, Margaret Thatcher's right-hand hatchet man, put it neatly in reference to the radically democratic Greater London Council of the early 1980s: 'This is the modern socialism and we must destroy it.'
The grounds for these fears lay in the distinctive features of those movements and projects described in this article. In their ways of organising (combining autonomy and co-operation, creating the participatory conditions for the genuine sharing of knowledge), the alliances they built (across the traditional divides of economics, culture, labour and community) and their vision (beyond state versus market, individual versus social), they held out in practice the possibility of an alternative, participatory and co-operative political economy.
For a time, the new political culture seemed unstoppable. Now, in the presence of Occupy and the multiplicity of movements that share in new ways the same hopeful characteristics, it feels as if, like a mountain stream that disappeared from sight, the same 'excess of democracy', with its springs in the 1960s and 1970s, is bubbling up again.
Hilary Wainwright is a founding editor of Red Pepper and research director of the New Politics programme at the Transnational Institute (TNI).
from Red Pepper, February 2012
by Hilary Wainwright