Which Production System for your Post-Capitalist Society?

The core goal of a post-capitalist production system is to produce what society needs - no more and no less.

The “no more” is important: producing more than necessary may imply that labour and natural resources (both scarce) are being wasted, or it might be simply impossible to provide for everyone’s extravagant desires using the available resources. Therefore, some systems may approach the problem of production by setting limits or rations on the amount that can be consumed, or by tying people’s consumption to their labour contributions, to prevent people from making extravagant demands of the production system. For want of a better term I will call these systems “consumption-setting” systems.

But “no less” is also important: producing less than necessary may imply that people are being deprived and their needs are going unmet. Hence another kind of system will define the amount of labour that each working person is supposed to contribute, with the goal of ensuring that all the necessary labour actually gets done. I’ll call these systems “labour-setting”. Some systems might be both labour-setting and consumption-setting, or they might be neither.

The “problem of production” is a twofold problem. The system must specify how to divide up the labour and how to divide up the output. That is the essence of “labour-setting” and “consumption-setting” systems respectively. For labour-setting systems, underproduction is considered a risk and so quotas are put on labour. For consumption-setting systems, overproduction is considered a risk, and so limits are placed on consumption.

Having neither of the two systems and allowing people to contribute and consume entirely according to their whim, would put society in serious danger of not even solving the basic problems of production: there is no guarantee that it would produce enough, and it might also produce lots of things that are not needed. The eight systems below are solutions to these problems.

We will discuss four consumption-setting and four labour-setting systems. Each system is defined by a simple equation. The terms that appear in the equations are as follows:

Each of the systems we’ll consider below should be thought of as a starting point for working out the details of a post-capitalist production system. Each one can be modified in a variety of ways to solve further problems, as we will see. Furthermore, it is not necessary to choose one and only one system and apply it to the entire economy. It makes perfect sense to use different systems for different parts of the economy.

  1. ci = C / N, “Planned Equal Consumption”

  2. ci = ∑li / N, “Dynamic Equal Consumption”

  3. li = C / n, “Planned Equal Labour”

  4. li = ∑ci / n, “Dynamic Equal Labour”

  5. ci = αiL, “Planned Labour-Linked Consumption”

  6. ci = αi∑li, “Dynamic Labour-Linked Consumption”

  7. li = αiL, “Planned Proportional Labour”

  8. li = αi∑ci, “Dynamic Consumption-Linked Labour”

1. ci = C / N, “Planned Equal Consumption”

In ci = C / N, the economy is planned. An estimate, C, of society’s total consumption is made at the start of every production cycle. This quantity could be chosen by a planning committee based on data about the population. Each product and service is then assigned a price. This price could be chosen arbitrarily, or it could be set so that it equals the number of hours required to produce it, or the amount of energy required to produce it. Every citizen receives exactly C / N credits - that is, everyone receives an equal number of credits and the total number of credits in existence exactly matches the amount of products and services that have been produced, C. Therefore it is not so important how the price is set; what is important is that the sum of the prices is equal to the sum of the ‘wages’, which equals C. These ‘wages’ are not really wages, because they are given to every citizen regardless of whether or not they work or how much labour they contribute.

It is also very important to realise that the ‘money’ or ‘credits’ given to each person are not actually exchanged or traded. When a consumer accesses a product or service the price is deducted from their account, but the money does not ‘go’ anywhere. The function of the credits is to ration the output, so once they are spent, they have served their function and therefore cease to exist. If hypothetically all the products and services are purchased then there is no longer any money in existence. When the next production cycle is complete, a new batch of credits is created which exactly covers the new value of C and each citizen is again granted exactly C / N credits for them to spend however they wish. Therefore, production does not depend on money or “investment” as it does in capitalism. Production depends only on labour and natural resources. The economy (whose size is given by the quantity C) can grow, shrink or remain the same size purely at the whim of the planning committee or whatever other system is used to plan the economy.

Instead of an undemocratic planning bureaucracy, Castoriadis[1] suggests that planning decisions be made by a majority vote of the population. In our terms, that means that for each production cycle, the population votes on various proposals which specify a product or service whose production should either expand or contract and specify how this affects the value of C.

Since this is a consumption-setting system, the labour has to be handled by choosing a supplementary labour-setting system, or by leaving it to pure voluntarism, with each person contributing however much they like, where they like. For these purposes it certainly makes sense to set the price of each product to reflect the amount of labour that it requires to produce. This way, society can make planning decisions based not only on how it affects their consumption but also on how it affects their workload.

2. ci = ∑li / N, “Dynamic Equal Consumption”

This is the unplanned, or “dynamic”, version of system 1 above. Like in that system, credits are used to limit people’s consumption and the quantity of credits exactly matches the economic output. Unlike that system, however, the output (the size of the economy) is not known in advance. The consumption limit is calculated as the sum of the contributed labour hours (for all i in the set of workers) divided by the total citizen population.

Assume that labour is handled by voluntarism. People are contributing labour where they like and to the extent that they like. Once something has been produced or when a service is ready for consumption, its total value - whatever it is - is divided equally among the citizens. As such, the balance of a person’s account naturally increases as society produces more things, and decreases as that person consumes them. Again, the price of each product could be set arbitrarily but it makes sense that it reflect the amount of labour or energy required to produce it.

This system is instantiated by technocracy - for example, the system espoused by EOS[2]. They call this system “energy accounting”. The total energy (a physical quantity) required to power the society is divided equally among the citizens. They spend these “energy credits” however they wish.

Note that this system cannot be combined with one of the labour-setting systems because then labour and consumption would be defined in terms of each other. However, a labour quota could be set to a constant value - requiring each worker to contribute, for example, at least 15 hours of labour a week. But then the size of the economy would be arbitrary and would not necessarily meet people’s needs. For handling labour, this system might be best combined with a system of “split voluntarism”.

3. li = C / n, “Planned Equal Labour”

This is the labour-setting counterpart to system 1. As in that system, an estimate of total consumption, C, is required to start the production cycle. In this case however, instead of dividing the output among the citizens so that each person has the same consumption, we instead divide the labour among the workers so that each worker has the same labour quota.

Once C has been determined, each worker is required to contribute an equal share of the necessary labour, C/n. This time, no money or credits are required unless a consumption-setting system is also in use. Consumption could be handled “according to need” - that is, allowing each person to take whatever they like from the output. If people try to take more than the amount that has been produced, this means that there was a failure at the planning stage: C was underestimated. This would need to be corrected as soon as possible and each worker then receives a revised labour quota.

This system can be combined with the preceding system so that it is both labour-setting and consumption-setting. That way it avoids underproduction by giving each worker a labour quota, equal to C/n and avoids overproduction by giving each citizen a consumption ration, equal to C/N. In that case, both the labour and the output are divided up equally.

4. li = ∑ci / n, “Dynamic Equal Labour”

This is the dynamic version of the above, as well as the labour-setting version of system 2. In this system, the labour that each worker must contribute is an equal proportion of the actual demand, rather than a proportion of the estimated demand as in system 3 above. For this to work, consumers would need to request exactly which goods and services they require in what quantity, before they are even produced. This is hardly problematic, since we already have thriving “production-on-demand” systems today. Here, the amount of labour required to produce the requested products and services is then divided by the number of workers. Each worker contributes their share, no more and no less; when production is complete, the products and services are then delivered directly to the consumers who ordered them.

Products and services could be available “according to need”, but that is risky in the case of an unplanned production system like this one. If people have extravagant demands then the size of the economy would have to expand to meet them and this might not be possible, at least not without severely overburdening the working population. The simplest way to solve this problem is for each production system to define the maximum that it is prepared to or able to produce and to process orders in the order that they are received, and then try to re-prioritise orders that come from people whose need is greater - for example the infirm, elderly and young children.

5. ci = αiL, “Planned Labour-Linked Consumption”

In the first four systems, labour was divided equally among the workers for labour-setting systems, and consumption was divided equally among the citizens for consumption-setting ones. In the next four systems, the labour and consumption are not divided equally.

For ci = αiL, a person’s consumption limit is directly related to the amount of labour which that person has contributed. To illustrate with example figures, suppose L is 1000. Society is saying “1000 hours of labour are required to produce everything we have decided to produce in this period”. Therefore, exactly 1000 labour credits are up for grabs. Each person contributes a certain proportion of this labour (represented by αi) and receives that number of credits in return. As a result, the amount that each person is allowed to consume is proportional to the amount of labour that they contribute. If someone does 1% of the work, they get 1% of the output.

In the communist literature, “socialism” is often defined as a system which is based on the adage, “a fair day’s pay for a fair day’s work”. The term “communism” (or the “higher phase of communism”) is reserved for a system based on the adage “from each according to their ability, to each according to their need”[3]. Some people have ended up advocating the “socialist” system as an end in itself - for example, in the collectivist wages system advocated by anarcho-collectivists, which finds a modern instantiation in Michael Albert’s Parecon (participatory economics)[4].

The system as it is presented here suffers from a potentially fatal flaw. Not everyone in society is capable of working. Without modification, a real society adopting ci = αiL would be at risk of collapse, because many non-working people such as infants, the elderly and the infirm would not be able to get any labour credits. It might be assumed that every non-working dependant is “naturally” paired up with one or more working people, probably members of their family; non-working people would be completely dependent on the labour contributions of their carers, who would have to work more than other people in order to support them. This results in a situation where both dependants and the people who have dependants are systematically disadvantaged, which is a moral injustice. Today, the people who have dependants are women, overwhelmingly, and this self-same systematic disadvantage is one of the factors sustaining patriarchy.

One way to overcome this problem is to have a separate “benefits” system for non-working people. They would be provided with a constant number of credits which would have to be enough to cover their needs. In our example, suppose that 200 of the 1000 planned total labour credits are reserved for non-working people. Then, 800 credits are up for grabs. The amount of time that you must work in order to receive one credit is now longer than one hour. For one hour’s work you will receive 0.8 credits in this example. Some people might think that this violates a principle, the American Dream nonsense that you should be entitled to the “fruit of your own labour”. Unfortunately for them, there is no way to get around this issue. You can never receive the “full product”[5] of your labour, because some of it must be reserved for those who cannot work; and those people, a group which includes newborn infants, will never go away, not even in their wildest American Dreams.

Because of the necessity of the benefits system, this system turns into a hybrid, where cii(C−C2) is used for working people and ci=C2/(N−n) for non-working people, where C2 is the estimated total consumption of non-working people. I would argue that having an entirely separate system for non-working people is undignified and raises the question why we wouldn’t just choose to use ci=C/N for everyone.

6. ci = αi∑li, “Dynamic Labour-Linked Consumption”

This is theoretically the unplanned version of the previous one. Here, the size of the economy is not know in advance. Each person contributes whatever amount of labour they like. Once they produce something, a corresponding number of credits is created to cover it and is immediately given to the worker. This means they can buy the product that they produced or some other product or service of equal value.

Like with system 5, this system does not naturally have any way to deal with those who cannot work, who remain dependent either on charity or on a separate system of taxation and benefits. In system 5, a quantity of the total credits was reserved for non-working people. Here, since the total number of credits is never known in advance, it would be necessary to tax people’s earnings. This means non-working people would be entirely dependent on the working habits of working people, which they would have no control over - a serious flaw.

Naturally we have to ask ourselves, is this system capitalism or is it just something very similar? In capitalism, people do not receive the full product of their labour less taxes, they receive even less. Surplus value is extracted from their labour to fuel capital accumulation. As a result, there is not enough money in consumers’ hands to buy everything that has been produced. In this system, in contrast, the sum of the wages exactly matches the sum of the prices. There are other general differences between the “credits” we have been talking about here and the system of money in capitalism. We will talk about those in a little while.

Who exactly is regulating the money supply here? If anyone were allowed to create money out of nothing then clearly the system would be ripe for fraud. Since this is not a capitalist system the only viable option is for money to be created as a deliberate act by the political organs of society to cover a particular product or service. In practice, what that means is that people would contribute labour autonomously and then some sort of political decision must be made to “reward” this contribution with a monetary value equal to the labour hours expended, less tax. The simplest way to do this would be to allow every citizen to vote for a product or service and if it receives more than a certain number of votes, it is accepted. The corresponding amount of money is then brought into existence and the worker can spend it how they like.

Therefore, every labour contribution starts off life as a voluntary contribution. Then society decides whether or not to accept it as a contribution to society. If society does not accept it, the worker is stuck with what they’ve produced themselves. It’s no good to anyone else, as far as society is concerned. Unfortunately, if the work is not accepted then the worker may not have any credits with which to buy the products they actually need. Unless the benefits system covers them they might have to eat the thing they’ve produced or else risk starvation.

7. li = αiL, “Planned Proportional Labour”

Although the formula is indeed similar to system 5, we should not be fooled: this system has a totally different character to Planned Proportional Consumption and probably deserves to be named differently. (This is because αi in both cases is related to the amount of labour contributed, not the amount that is consumed.) It is instantiated by a system called the “volunteer game” described by Christian Siefkes[6]. In this system, as in the other planned systems, society first decides what to produce and estimates the number of labour hours required to do so. It is not necessary to plan everything down to the last pin head; all that is necessary is to decide which parts of the economy need to expand production and which need to contract, relative to the actual data from the previous production cycle. Then we have our quantity L.

In the volunteer game, there is a guideline labour contribution quota and each working person must choose for themselves what proportion of the quota they wish to fulfill. When everyone has chosen, the proportions are added up and the guideline labour contribution is then revised - either upwards, if the chosen proportions mean that we won’t get everything done, or downwards, if people are being over-eager. If the guideline contribution has changed significantly then the volunteers are given the opportunity to revise their proportions, and this process continues until everyone is happy with the amount they are going to contribute. Their labour quota, li is then equal to their chosen proportion of the guideline amount, and this is some proportion of the total, which is here called αiL.

The important feature of this system is that each person contributes a variable amount of labour that corresponds to their own capabilities and wishes. Since all the available labour has been claimed and there is no more labour available, you know that once you have contributed your share of the labour you have no other duty. At the same time, since everyone chooses the size of their contribution for themselves, they hopefully never need to feel overburdened or underburdened. All the labour gets handled - there will be nothing left over and no more than this has to be done.

If the economy is planned carefully so that it correctly takes into account everyone’s needs, it probably does not need to have a separate consumption-setting system for dividing up the output. In that case, the system instantiates the adage “from each according to their ability” in its labour system and “to each according to their need” in its consumption system.

8. li = αi∑ci, “Dynamic Consumption-Linked Labour”

Finally, we have the labour-setting counterpart to 6, or the dynamic counterpart to 7. Like 7, Christian Siefkes has also documented an instantiation of this system which he then called “peerconomy”[7], an economy based on peer production.

In this system, the amount of labour that you have to contribute is a function of the amount that you intend to consume. This is the reverse of the crazy system we talked about in 6 where the amount that you were allowed to consume was proportional to the amount of labour you contributed.

This is also the “consumption-linked” counterpart to system 4, which was Dynamic Equal Labour. Like in that system, people put in orders for products and services that they want to have. Unlike in that system, however, the amount that you are required to contribute in labour corresponds to the labour required to produce what you’ve ordered. You don’t have to contribute that labour by actually producing the things you’ve ordered. You can contribute that labour anywhere you like. You are doing the labour that is necessary for other people’s orders. Once the product is finished or the service is ready, it is provided directly to the person who ordered it, so long as they can be trusted to contribute their share of the labour if they haven’t already. If they fail to do so, perhaps they won’t be trusted to do so in future and will therefore be expected to contribute the labour before they are allowed to receive the product, even if it is ready for consumption.

People who are unable to work need to be provided with ‘free credits’ in order for this system to be viable. Then, the amount of labour each person has to contribute ends up being more than the amount of labour required to produce what they’ve ordered, because they have to produce for the non-working members of society as well. Like the other systems that require some sort of ‘exemptions’ or ‘benefits’ system, the resulting system ends up being a hybrid. The labour required to cater for non-working people is socialised and distributed evenly among the working population as if we were using li=C/n or li=∑ci/n, depending on whether the consumption of non-working people is planned/static, or if the workers will simply handle any extra required effort regardless of its magnitude.

Communalist vs Distributed Systems

Each of the systems described above potentially has two variants. In a communalist system, production is handled on a society-wide scale. For consumption-setting systems, that implies that credits are distributed to every single citizen in society. In a labour-setting system, it implies that labour is distributed to every single worker. In a planned economy, it implies that the economy as a whole is planned. A distributed system, on the other hand, does things on a workplace-by-workplace basis. I usually call these workplaces “guilds”. In general, a guild is autonomous in terms of its decision-making structures, controlled by its workers and/or consumers, whereas a communalist service is managed as a public service and is controlled by citizens.

Imagine we have a consumption-setting guild that produces food, using the system ci=C/N. Consumers sign up to receive products from the farm, like in Community Supported Agriculture. The production is then planned accordingly. The yield may vary, but an equal number of credits is distributed to each consumer that has signed up. Then the consumers take what they want up to the maximum that their credits allow. Compare that with a communalist agricultural system, where the farm is producing some proportion of the total food required and distributes credits to everyone in society. (Hence, consumers in communalist systems don’t need to “sign up” for anything.)

Now consider a tailoring guild that uses the labour-setting system li=∑ci/n in a distributed fashion. Consumers place orders for the clothing that they require. The labour-hours required for all the orders are totalled and distributed equally. Now there is a further choice: the labour might be distributed only among the workers in the guild, people who have specifically decided to work here. Or it might be distributed among the consumers, meaning that they are responsible for contributing the labour. In that case, it would be convenient if they can contribute their labour to a completely different guild (cf. Siefkes 2007, the concept of a ‘distribution pool’), because they might not be skilled in tailoring. The important point is that the labour of this guild is handled by the guild. In a communalist system, by contrast, the labour required to make these garments would be evenly distributed among every working citizen in society.

One is not better than the other. The average workload for a citizen in both communalist and distributed systems would be the same, though in distributed systems it is no longer the same for each person, because you only have to handle the labour that is relevant to your own life.

Just as we can use different algorithms for different sectors of the economy, it is also possible to have one society in which some sectors of the economy are handled distributively and others are handled communally. For example, labour for agriculture might be communalised (everyone contributes) whilst labour for tailoring is distributed (only members of the guild contribute). This corresponds to the situation in capitalist “mixed” economies, where some sectors are handled by a market and others are handled by the state. I discuss this in more detail here and give a detailed example here.

General Problems

A general problem with the “equal” systems - the first four - is that they do not take into account the differences between people. By treating everyone equally they imply that everyone has an equal capacity for labour, in the case of labour-setting systems, or an equal consumption demand, in the case of consumption-setting systems, and while this might be a reasonable approximation for some purposes, it doesn’t match up to reality. Different people have different needs, a different calorific intake, a different taste or a different ambition. As a result, some people in “equal consumption” systems might end up with fewer credits than they actually need. Different people also have different capabilities and a different capacity for and proclivity to labour. In labour-setting systems, a person who wants to work more than average could do so, and consequently reduce the labour quota for everyone else; but a person who wants to work less than the average would have to negotiate this with their co-workers. These are not fatal, society-destroying flaws, but they need to be considered.

A general problem with the “linked” systems (systems 5, 6 and 8) is that they have no natural way of handling the people who are unable to work. This is a society-destroying flaw. It can be rectified, as outlined in the text, but only by falling back on one of the “equal” systems. This not only potentially subjects the non-working people to the propblems of “equal” systems, such as not exactly meeting their needs, but also raises the question of whether it is morally justifiable for non-working people to be treated completely differently from everyone else.

A general problem with labour-setting systems is that they must somehow decide who is and isn’t eligible to work - a labour-intensive process in itself with many grey areas. Furthermore there need to be consequences associated with a failure to fulfill the labour quota.

However, eschewing a labour-setting system in favour of pure voluntarism also has potentially serious pitfalls. With pure voluntarism there is no guarantee that all of the tasks will actually get done. If they do get done, it might only be possible by seriously overburdening the volunteers. Furthermore, many unpopular tasks (think waste disposal, cleaning or mining) might not be chosen at all. In the absence of a “system” people might be subjected to informal coercion or even intimidation in an attempt to get some people to do the unpopular but necessary tasks that nobody else wants to do. Finally, the stress of handling all the labour might make the volunteers resent the non-working people and may lead them to ignore the wishes of consumers and citizens. All of these problems could make the production system dysfunctional or cause it to collapse.

To avoid the pitfalls of these two extremes we can consider a labour-setting mechanism called split voluntarism.

Split Voluntarism

The “volunteer game”, li = αiL, is a kind of split voluntarism. In short, you decide whether or not you want to play the game, but deciding to play means you play by the rules. In its original formulation it was intended as a planned, communalised system, but there can be a distributed variant too, whereby people volunteer for a role in a guild/workplace of their choice, and this carries with it the responsibility to contribute their share of the labour in that guild.

What if some sectors of the economy (e.g. refuse collection) are still not freely chosen at all? This labour could be communalised among all of the guilds. They would probably use a rota system so that the duty for these unpopular parts of the economy is rotated among the guilds. As a result, a working member of a guild might end up with several different perks and responsibilities. Here is one possible example:

(The unpopular tasks are simply those tasks that haven’t been freely chosen by a volunteer.)

Using split voluntarism means it is no longer necessary to decide who is and isn’t eligible to work. The incentive for working is that you get to do whatever it is that you really want to do, which depends on your personal ambitions, affinities and abilities. Doing so, however, carries responsiblities towards the guild and to society. The most severe consequence of shirking your responsibilities would be expulsion from the guild. Unless there is a labour-linked consumption system in place, this would not be a death sentence, and the person in question would still be entitled to their share of the output.

There may be many so-called “free riders” who decide not to play the game at all even though they physically could manage it. But this is not a problem so long as this group of people is not too numerous and all of the necessary tasks are getting done without overburdening anyone. If the twofold problem of production is solved, then the presence of free riders is irrelevant, just as the presence of non-workers is irrelevant, given that society will always have many non-working people in it.

Credits vs Money

Consumption-setting systems involve the use of “credits”. Castoriadis insists[8] that these credits are a type of “money”. Yet the credits considered here have an altogether different character and a different modus operandi from the thing we know as “money”. Credits, unlike money, disappear when they are spent, and unlike in capitalism they are not needed to invest in the production system. Credits are created by the production process and are expended by consumption. Every credit in existence is matched to a product or service somewhere in society which already exists and merely needs to be claimed. The sum of the credits always exactly equals the sum of the prices, which matches the sum of the labour contributions.

In fact, money and credits have a completely opposite character. In capitalism, money is the input of the production system and the size of the economy is determined by the amount of money available. In contrast, credits are created by the production system and the number of credits reflects the size of the economy. The entire causal sequence is reversed. In one system, money is the cause and production is the effect; in the other, production is the cause and money is the effect.

I consider the latter, where money (credits) follows production, to be the natural order of causality and that capitalism has it the wrong way around. The reason for this is that when production comes first, the purpose of the economy is the production of use values - things that society needs - which reflects the fact that the goal and raison d’être of a production system is to produce the things that society needs and wants. If the causality is reversed, however, and money itself becomes a prerequisite of production and therefore a prerequisite for obtaining the things we need, then the economy’s purpose is to produce exchange value which can act as an input for future production. Ignoring the necessity of exchange value and focusing instead on use value is systematically disincentivised because a lack of exchange value poses an existential threat to production itself. In a “natural” production system, this is nonsensical because production physically only depends on labour and natural resources, not on exchange value.

It is not the focus on “profit” which is the evil in capitalism, it is the focus on exchange value itself. This is explained in more detail here. Money being required for production implies that the means of production are privately owned; whilst credits being created by production implies that the means of production are held in common. Therefore, a system with exchanged money is necessarily capitalist. This reveals the reason why Soviet economies were in fact capitalist: they failed to reverse the causality of the production system, and therefore failed at being communist. Capitalism and exchange value go hand in hand, and they must go away hand in hand.

In the natural systems described above, credits are not exchanged; they disappear when spent. They are like single-use vouchers. As a result, it’s not possible for there to be a second hand market in a natural production system, because no additional labour is required to provide something that has already been produced. Second hand products can only be given away for free, never sold. If this sounds problematic, think again. The second hand market exists because some people have something which they no longer have need of. Rather than producing a new product, which would require additional labour, it makes sense to recycle the old product by giving it to a new owner, so long as it is still functional. Therefore the problem of the second hand market is merely about matching up a person who doesn’t need a product with a person who does.

This process would be a lot smoother if money were not involved, and indeed there are already plenty of so-called “gift economy” services on the internet where people do exactly this. Of course, people rarely give away expensive objects like cars and houses in this way - for obvious reasons. But in a natural economy that is exactly what they would have to do. If you wish to move house it is only necessary for you to find a house which someone is moving out of. The exchange of money that also takes place in a capitalist system is a bizarre ritual that serves no purpose. The houses have already been built. The labour has already been handled - usually by people who are not party to the exchange. And those people have already been paid in full. Exchange is always robbery, regardless of the quantities involved.

Credits vs Approval

In Binding Chaos, Heather Marsh proposes an economy based on approval[9] rather than money. In an approval economy, people are granted approval for contributions to society and have approval deducted if they commit acts harmful to society. Reaping the benefits of society is then dependent on your approval rating, not on your credit.

This is a variation on dynamic consumption-setting systems and can potentially sidestep the pitfalls of those systems. People who are unable to work still have opportunities to gain approval in other ways, so they do not need to be subject to a separate and complex system of taxation, benefits and exemption. We also noted that consumption-setting systems may end up not giving people the right number of credits for their needs. In an approval system, your approval does not go down when you take from the output: so long as you have at least the approval value required for the given product or service, you are entitled to take what you need (and society is obligated to provide it).

Other Variations

Instead of money, credits or approval, Alfred Fresin[10] proposes a system where products are categorised into one of three tiers: basic provision, normal provision and special provision. Basic provision is open to any and every citizen and covers a person’s basic food, shelter and healthcare needs. Normal provision is only open to people who contribute a certain amount of labour or to those who are exempt from labour, and includes additional services that most people need occasionally. The special provision includes luxury products and is only open to people who have contributed a larger amount of labour.

Both Fresin and Christian Siefkes also propose “weighting” tasks based on their (lack of) popularity or their perceived strenuousness. For example, an unpopular task like cleaning might be weighted double, so that one hour of cleaning labour counts as two hours towards a labour quota. The other tasks in the system have to be weighted lower to compensate for this, because the total amount of labour is constant. This gives people an incentive to choose the less popular or more demanding tasks.

Examples and References

For further exemplification see my fictionalised example, “Welcome to Liminas” or my earlier Vision article. For details on these systems by other writers - who are my main sources - see this references list.

  1. Cornelius Castoriadis, Workers Councils and the Economics of Self-Managed Society.  ↩

  2. The Earth Organisation for Sustainability: see their explanation of energy accounting.  ↩

  3. See Vladimir Lenin, The State and Revolution, chapter 5.  ↩

  4. See Michael Albert, Parecon: Life after Capitalism.  ↩

  5. Again see Lenin (above). Lenin also writes: “Marx shows that from the whole of the social labor of society there must be deducted a reserve fund, a fund for the expansion of production”. This idea is also noted by Castoriadis[1]. As far as I can see, however, this “investment fund” is not necessary in a system that has abolished exchange.

  6. Das Freiwilligenspiel by Christian Siefkes.  ↩

  7. See Christian Siefkes (2007), From Exchange to Contributions. Link.  ↩

  8. Cornelius Castoriadis, Workers Councils and the Economics of Self-Managed Society, section 7d.  ↩

  9. In Heather Marsh, Binding Chaos.  ↩

  10. Alfred Fresin (2009), Bedürfnisorientierte Versorgungswirtschaft statt Kapitalismus.  ↩