Sunday, April 24, 2011

What transition? Part 4: Renewing the framework (Installment #1: "De-growth" and an economic Kyoto protocol)

Now that we have seen how flawed the current mainstream responses to global imbalances are (in Part 2), and what alternative vision might guide citizens and decision-makers towards a new horizon (in Part 3), we're ready to spell out the framework conditions -- at least some of them, and if possible the most strategic ones -- which could ensure that the "muddling-through" process will lead to a real and effective, durable and viable, pluralization of modes of production, patterns of consumption, conceptions of work and work practices, monetary systems, and ways of social life more generally.

Given what I said in the previous post about my own libertarian take on progressive politics, I believe that we ought to promote nothing but these framework conditions, because in a democracy the public sphere, where debates take place and binding decisions are made and justified, should never be a place where doctrines are imposed at the level of personal lives. If what we are after is the "integral" liberation of persons -- and this, I believe, is what genuine liberalism is all about -- the conditions we do accept to be binding on us ought to be conditions that ensure radical equality of opportunity. As we saw, this means the possibility for each citizen to choose, and to modify over his or her lifetime, the sort of economic mechanisms she accepts to submit to. Such a choice is never completely unconstrained, and the way of life one chooses is never free from encroachment from other ways of life -- but this fact of democratic life is not an argument for upholding, and even reinforcing, the power relations currently prevailing within capitalist social democracies.

As a result, the framework conditions we are going to be studying over the next few posts should
  • be implemented by deconstructing the ongoing power relations -- which is, of course, the hardest political task in any transition, and requires the framework conditions to be designed in such a way that people become able to sidestep power relations with as little sanctions as possible
  • contain mechanisms and tools (especially cultural and political tools and, more prominently still, legal and legislative ones) that will make it possible not to build up new, post-transition power relations which would cancel the pluralizing dynamic that was initiated


1. Global footprint reduction, "de-growth," and an economic Kyoto protocol

I have repeatedly spoken of the fact that today's globalized, industrial-financial capitalism, with its highly non-selective trade flows and its clear tendency to view human labor as one more raw material, generates (as its forebears have been generating at least since the mid-19th century) both (a) bio-environmental externalities which mean that all economic actors taken together are busy, each in his own way, making the natural environment unbreathable and less and less hospitable for life; and (b) anthropo-environmental internalities which mean that, within economic organizations, actors are busy (also each in his own way, depending on the place he occupies in the functional distribution of roles within capitalist social democracy) making the human environment less and less bearable for each other. Not all externalities are internalized by capitalist markets -- in fact, with the help of various pieces of legislation, there might well be a tendency for the reverse, with less and less externalities needing to be internalized because of sacrosanct competitiveness imperatives. And not all internalities are externalized within capitalist organizations (including profit-financed public services and nonprofit organizations) because, again, capitalistic bottom lines make it costly to do so, implying an increased pressure for the costs of "humanizing the economy" to be shoved onto the victims themselves. (A paradigmatic case is the trend towards denying the validity of claims concerning suffering at the workplace, and attempting to make all moral harassment legislation inoperative, with the complicity of the judicial system itself, so that individual sufferers have the choice between passive but illegal protest and uncomplaining adaptation.)

Greenhouse gas emissions are just one aspect of the negative effects of our current economic model. More generally, there is the issue of humanity as a whole having a much too large ecological footprint -- you know, all those estimates that say that, were all inhabitants of the earth to produce and consume like those of the so-called developed world, anything between three and nine planets Earth would be necessary. The resource overshoot day (i.e., the day on which humanity starts going into ecological overdraft given the planet's regeneration capacity) comes earlier and earlier each year.

The world-famous US environmentalist Bill McKibben (see his website in the sidebar) is known for having said that before we run out of oil and other non-renewables, we're likely to run out of planet: Pollution and climate change might well reach catastrophic tipping points soon. McKibben has coined a new term for the kind of planet which our earth is in the process of becoming: he calls it Eaarth (the title of his latest book), to emphasize the reflexes of disgust and alarm -- as in "Aargh!" -- evoked by the recent developments on the bio-environmental front. McKibben's militancy within the group (a group set on acting and encouraging collective action so that the density of greenhouse particles in the atmosphere is kept below 350 parts per million, or ppm; see [Note: 1 ppm = .0001 percent of the atmosphere's volume] has led him to advocate drastic reduction measures, focusing especially on the richer countries, and even though he is certainly no technophobe he does realize that the state of today's transportation and manufacturing industries cannot be upheld. This is essentially the same message as the one circulated by most climate-change experts within the IPCC. The massive and drastic CO2 emission reductions these people and organizations call for (the figure gets updated constantly, ranging anywhere from minus 85 percent within ten years to minus 120 percent within five years) is utterly frightening to most traditional economic elites in our part of the world, but it's also utterly exciting for those techno-geeks who want to use this sad opportunity to experiment with new combinations of old, traditional technical lore and frontline, cutting-edge innovations. (Juliet B. Schor's new book Plenitude contains many stimulating vistas in this area.) And clearly, the Kyoto protocol and whatever successor accord the world's leaders may be able -- or grudgingly willing, as the case may be -- to agree on is paramount if we're not to run out of planet even faster than we run out of oil.

A frequent topic for contention in debates on climate-change and footprint-reduction issues is whether "market forces," left to themselves, can generate the appropriate motivations in individuals, firms, and countries. Free-market zealots like Wilfred Beckerman have long claimed that price changes for raw materials and cost-driven price hikes for energy-intensive manufactured goods will eventually shift supply and demand into more environmentally sound niches. Those who, like Beckerman (and many others), want to remain inside the capitalistic logic and who place their full trust in private-profit-driven bottom lines believe that what must prevail first and foremost is the individual freedom to exchange and transact. The two main tools to coordinate people's voluntary self-restraint are the market and technological innovation. The underlying vision relies on the self-regulation of the profit-cum-research pair, via the mechanism of market competition. As non-renewable resources become scarcer and/or renewable ones are discovered, private firms' search for profitable outlets for accumulated capital (including the private financing of academic research) is assumed to push them into investing in innovation in order to safeguard their market shares by reducing costs. (Fossil-fuel-extracting firms, in their turn, are assumed to play a specific role -- that of carrying out profit-maximizing R&D so as to substitute renewables for non-renewables.)

As a result, thanks to the market's automatic mechanisms (and provided all resources are private property), "green capitalism" will supposedly generate productivity increases in "clean" sectors, which will usher in a new era of "green growth." The underlying hope is that, thanks to endless human ingenuity, we might collectively be able to produce more and more by consuming less and less energy -- more precisely, by perpetually reducing the second-degree energy incorporated into products plus the first-degree energy needed to extract the second-degree one. And what can only be produced with large quantities of resources will be rendered wasteful through the market-price mechanism: too expensive, hence not profitable enough, hence abandoned.

This purely market-based vision of green growth has been challenged by many social democrats who are skeptical of the market's ability to induce, on its own, the required reorientations (a) quickly enough and (b) in an equitable fashion. On the one hand, market mechanisms are not capable of integrating long-term effects because the horizon of actors' profit seeking is relatively short compared to what is required to address most intergenerational as well as minority-protection issues (i.e., taking into account the interests of future human generations as well as the present "interests" of nature). On the other hand, the market registers only the aspirations and desires of people who have the monetary means to buy, so that whatever market-driven re-adaptations might occur through a globalized, "green" capitalism, they are likely to be responses to the preferences of the relatively rich citizens of the planet. That's why the role of the State and of collective decision-making in general cannot be simply to draw up a juridical and regulatory framework that will permit green capitalism to work optimally. We need ecological priorities to be integrated into prices, in particular through taxation schemes that force polluters to pay the full and complete price for their long-run impact on the environment.

In a nutshell, according to many skeptics of the free market, green growth needs to be decoupled from mere green capitalism and has to be integrated into a much more demanding "green social democracy." It is up to the State, not the market, to guarantee the conditions of economic growth in such a way that, though R&D and through re-orientations prompted by the change in the structure of prices, investment and trade decisions fully integrate the economic reality of resource scarcity and the political imperative of doing more than maximize short-run financial surpluses. But can a social democracy that remains anchored in capitalist wealth creation -- albeit, now, "green" wealth -- actually deliver on this ambition? I doubt it. This is so especially because, beyond McKibben's claim that we may run out of planet before we run out of fossil fuels, there's another claim that sounds equally alarming, having to do more with what I called anthropo-environmental internalities: Way before we came to realize we might run out of planet, we have been running out of humanity -- in the sense of human lives that have deep meaning and a deeper sense of purpose. And while I'm not a Marxist, I do believe that the young Karl Marx in the 1840s had already seen this very clearly. So had those whom he derogatorily called the "utopian Socialists." Our economic system isn't just about resource depletion, even though that issue is paramount; it's equally much about human alienation, or human-content depletion. And it's actually our alienation -- this deep-seated and nagging feeling that we might be missing something, that we always need to have more individually, that we are responsible for not doing what it takes to contribute to the collective effort of wealth creation -- which accounts for much of the environmental damage we inflict, often quite unwittingly, on our biosphere.

A reluctance to squarely face the issues of human alienation is, to my eyes, one of the main reasons why pure green capitalism is found to be so attractive by many economists. That attraction is not completely illegitimate, either. I mean, who wouldn't dream of being able to solve the planet's ecological problems without so much as tweaking the "crooked timber of humanity," as Isiah Berlin called it, taking his cue from Immanuel Kant? And indeed, free-market green capitalism postulates that human mentality need not change. More precisely, it postulates that it should not change: In the eyes of free-market defenders of green capitalism, the condition for market self-regulation to work optimally -- in the form of the proverbial invisible hand -- is that the timber of humanity remain adequately crooked... Green social democracy, on the other hand, is more schizophrenic and, in that sense, actually somewhat less credible. It postulates that in their economic lives, citizens need to remain homo economicus but that they have a moral duty to agree with stricter rules and regulations imposed in the name of the common good by public servants and public-minded actors (administrators, public lawyers, and political decision-makers) who do not reason as homo economicus does. If one were to follow this strange scenario, one would obtain green growth and new green jobs (presumably, at least as long as productivity-enhancing competition hasn't eroded the need for workers), but the raison d'ĂȘtre of these new jobs would continue to be the maximization of profits -- not of completely free-market, unencumbered firms, but of capitalist firms disciplined by an environmentalist State. (A discipline whose stringency would, in classical fashion, depend on the latitudes left to the State by the globalized character of the corresponding trade and capital flows.)

Unsurprisingly, the promoters of ecological and economic transition are very skeptical about the coherence of such a "green social democracy" scenario, even though they clearly share with the social democrats a rejection of free-market green capitalism. Firstly, they observe that the central engine of the economy would remain capital accumulation and, therefore, classically construed economic growth. Now, to what renewed horizon would this green growth be referring us? Whether or not it's green, whether or not it's mitigated by fiscal measures, it remains the same open-ended, non-selective, and downright anarchic economic growth and will sooner or later enter into collision with the biosphere's finiteness. Secondly, the "transitionists" underscore the fact that the fundamental problems of alienation linked to the denial of human finiteness are not addressed at all in a green social democracy: The State may seek to impose macro-level norms of "sustainability," but we still don't know what kinds of human life are supposed to thereby be made sustainable. It is myopic to want to organize the interdependency between human beings through a mixture of market and State without ever leaving any room for serious reflection on the questions, "What variety of human lives? What models of human beings?" True enough (and I've already emphasized this repeatedly in previous posts because I find it crucial not to be misunderstood in this area), you cannot "re-educate" citizens and force upon them ways of life they haven't themselves chosen consciously. Therefore, thirdly, it is very important that the monolithic character of the industrial-financial capitalist structure of our society be questioned via the creation of participatory spaces of reflection and action in which citizens can clarify their ideas on the purpose of life and the economy. This sounds grand and unrealistic, but it actually isn't. Those spaces need not, and probably shouldn't be, officially sponsored or privately engineered forums; they can emerge relatively spontaneously if more and more citizens become aware of the depth of the crisis and of the depth of their own alienation (somewhat along the lines of point (1) as raised in the quotation by Ivan Illich in the previous post).

What matters ultimately is that the growth imperative, as a structural and "genetic" necessity of capitalist social democracy, stop being seen as the foremost imperative guiding political decisions. But this, of course, means that the hegemony of capitalistic bottom lines has to be broken down -- and it's a classical chicken-and-egg question that can never be settled once and for all: Do we need to deconstruct the current system as a whole before we can usher in sufficiently momentous change, or will preexisting, necessarily partial and incomplete, small-step changes suffice to destabilize the system? In part 5 on the Next-Step Economy, we will of course need to give priority to this second assumption, because according to the transition model -- and in opposition to the revolutionary model -- it's the only one that can allow for initial steps right here and now. The whole issue will be how to calibrate those initial, first steps so that the larger-scale systemic issues beckoning on the horizon don't vanish in the quicksands of immediacy.

Questioning the growth imperative in the name of a general reduction in "toxic economic emissions" is very much akin to questioning the industrial practices of the day in the name of reducing toxic gas emissions. Toxic economic emissions include the alienating effects of consumerism on consumers as well as on workers, the alienating effects of productivism on workers and on managers, and the culturally destructive effects of growth-driven world trade. Most of these toxic effects are internalities, i.e., they are effects experienced "on the inside" by individuals and groups who have a hard time expressing them because they lack both the words and the legitimacy, as well as the public forums in many cases, to express them. That's why, just as in Kyoto world leaders, climate experts, and NGOs set up global norms for the reduction of greenhouse gas emissions, we also need a kind of "economic Kyoto protocol" that will allow for a wholesale reduction of those internalities.

Now it's not as if nothing at all existed in this area. The advances are somewhat timid, and mostly inserted into an economic worldview that remains pro-trade because it remains pro-growth. But there have been, and there still are, debates within the WTO on social and cultural norms to tweak some of the detrimental effects of uniformization through trade. The ongoing debates are strongly limited in scope by the fact that virtually no connection is made between the reduction of alienation-related human nuisances and the across-the-board growth imperative to which all parties to the negotiations accept to -- or feel they have to -- submit. In fact, given the prevalence of a system-dictated growth obsession made into a political goal, even socially or culturally motivated trade regulations may be used (and even advocated) by strong economic actors as additional ways to strengthen their domination. As
international trade-law specialist Krista Nadakavukaren puts it in her recent book, Social Regulation in the WTO:

"It is impossible to state in the abstract which of the possible solutions to the pursuance of social goals through the use of trade regulations is the 'correct' one. Not every use of social trade regulations is going to be either good (in the sense of minimizing the harmful impacts of the panoply of values to be balanced in the search for human dignity and sustainable development) or legitimate (in the sense of promoting an idea which every individual could accept as life-enhancing). And while I have argued that protectionism ought not to be the ultimate factor in determining whether a trade measure should stand or fall under WTO rules, certainly the implementation of an overwhelmingly rent-seeking measure [i.e., protectionism to shelter the strong and powerful] would be undesirable. (...)

Social trade regulations are not appealing political instruments. The denial of economic opportunities is seldom the most effective way to achieve political goals and the haphazardness of trade restrictions' use threatens to overshadow the particular achievements of any specific program. Moreover, in all but the most restrictive contexts they are illegal under the rules of the World Trade Organization agreements -- agreements which were voluntarily accepted by the Membership as comprehensively binding on their use of trade measures. Yet, economic measures are sometimes politically necessary instruments of remedying violations of the international legal system or of beginning a process of legal development. While not often the most 'efficient' tool of foreign policy, social trade regulations may be the optimal tool of foreign policy in a particular context. (...) While sceptics are right to criticize senders' inconsistency in applying social trade regulations, perhaps some attempt at improving the life of the international community is better than the politically-achievable alternative of no attempt. (...)
[U]nilateral actions may sometimes work more towards a community goal than multilateral inaction would. Until the members of the international system internalize the rules necessary for a recognizable society, social trade regulations will remain a necessary element of shaping that community." (Krista Nadakavukaren, Social Regulation in the WTO: Trade Policy and International Legal Development, p. 307 and pp. 314-315 passim, © 2010, Edward Elgar)

A trade lawyer's perspective on the legal and political difficulties of even a modest transition from socially unregulated to partially socially regulated world trade is invaluable to those head-in-the-clouds transitioners among us. What Nadakavukaren shows very clearly is that under the general worldview that rules the day among members of the WTO, often either social regulations will be introduced at home and/or promoted abroad as covert ways of securing rents for powerful domestic actors, or they will be opposed as politically unfeasible. The same is true for cultural protection (which she studies on pp. 213-240). The role of good working conditions and of culture in people's lives is, she argues, seen by the Appellate Body as something "left for others to worry about" (p. 220). This is, of course, only normal in the context of an economy that functions hegemonically on an unquestioned growth imperative, in the framework of which both cultural specificities and social norms or values are viewed mostly as obstacles to the creation of a level playing field for the most powerful members of the transnational capitalist class.

In fact, within that context the refusal of many developing and emerging countries to yield to the rhetoric of social protection (pushed by rich countries that have previously profited from its absence during the centuries of their own development) and of sacrosanct cultural protection (promoted by countries that have a powerful cultural-production and marketing sector) is more than understandable. In a world economy such as ours, where economic growth is totally uncoordinated politically -- and left to private forces linked to transnational capital accumulation -- and where there is no other way to attract international investors than to offer them powerful and short-term growth-boosting opportunities, it is only normal that many countries feel they cannot afford to adopt what are perceived as growth-impairing measures. So collective immobility ensues logically, such as has now virtually led the Doha round to a complete halt. In such a context of growth-necessity dictatorship, no "upward" norms might ever be forthcoming. And so, as Nadakavukaren rightly argues, unilateral departures from an international treaty or a multilateral status quo may be productive in the end, even if they are unbalanced to begin with: Pushing for tariffs or other barriers so as to stave off imports from low-wage, low-working-conditions countries may create short-term advantages -- perhaps even abusive, downright "protectionist" ones -- for powerful countries and their domestic firms, but it may still in the end generate a positive dynamic towards a worldwide upgrade in social standards or, for that matter, in culture-protection or environmental ones -- those she eloquently calls "
the rules necessary for a recognizable society," for a genuine community of nations or regions.

Now the crucial issue here is to what extent such a pragmatic, ultimate-value-oriented defense of even seemingly protectionist social (as well as cultural or environmental)
trade regulations might benefit from the existence of a more internationally coordinated, differentiated, and regulated economic-growth policy. I believe it would, in fact. I think it would go quite some in the direction of what Nadakavukaren calls "a recognizable society" at world level. Here's the idea: Low-wage, low-social-condition countries are likely to agree more spontaneously (at least, most of their citizens, apart from their own international economic elite) to more demanding social and cultural norms being pushed for worldwide if they don't feel these norms are a way for stronger countries of "kicking away the ladder" from under their attempts at attracting FDI and multinational capital with the feeble means at their disposal -- namely, a deregulated, unprotected labor market, no environmental obligations, no cultural barriers to Western products, etc.

One effective way of ensuring this is to build up an economic-growth "Kyoto protocol" in which (a) the world growth rate is calculated so as to be a cap on humanity's ecological footprint, (b) that world growth rate is furthermore adapted downward (if necessary) or upward (if at all possible) according to what is required for social and cultural protection norms to be practiced by all countries on an equal footing, and (c) most importantly, poorer countries get a growth credit while richer countries are asked to settle for the lowest possible (negative, if really necessary) growth rate. This would mean that as the planetary growth rate gets gradually reduced for ecological and/or alienation-related reasons, differentiated treatment would be given to the few already superlatively opulent and to those innumerable human beings whose communities and countries still need to achieve positive real growth per capita. This is precisely what economist Peter A. Victor emphasizes when, in his landmark book Managing Without Growth, he writes that "rich countries that have benefited most from economic growth should manage without growth to make room for the poorer countries where the case for growth is much stronger" (p. 21). He explicitly presents this as a matter of communicating vessels: less growth for the rich "makes room for" more growth for the poor. And this, of course, requires a macroeconomic framework which Victor is currently developing and which Tim Jackson is calling for under the label of an "ecological macroeconomics."

We need
  • planet-wide "de-growth," that is, an aggregate reduction in material throughput and output -- whereas the current trends all point in the opposite direction, despite all the technological progress and all the increased energy efficiency (because so much more less energy-intensive units of goods get produced, so that the per-item effect is more than offset by an explosion in the number items produced -- a phenomenon well known as the "rebound effect")
  • de-growth in the richest part of the planet so that there can be massive "re-growth" in the many maimed and all but destroyed economies of Africa, Asia, and South America (and, since there is to be net de-growth at the world level, this means a much more than proportional reduction in throughput and output in richer countries)
  • selective de-growth within richer countries, too, since there is no reason why even with a negative macroeconomic growth rate, countries such as the US or Germany should not have positive growth in certain selected sectors (Education and health? Public services? "Love-miles" or human-relations-related transport? etc.)
The domestic growth objective for poor countries would most likely not be achievable through FDI from richer countries now slowing down their own economies. Thus, within a global de-growth compact to be institutionalized (see the next post on new governance structures), the transition of poorer countries towards a high-growth regime will most probably have to occur by a high premium being given to the buildup of domestic, local human, social, and economic capital. This is truly a huge task for the elites as well as the citizens of such countries, but some of the most frontline development economists of our time (such as Jeffrey Sachs and, in a very different vein, Esther Duflo) are confident that with the right mixture of top-down steering, citizen-oriented (rather than elite-oriented) expertise, and bottom-up citizens' participation, significant progress can be made towards experimenting with culturally differentiated as well as locally adequate incentive schemes and governance structures.

To be sure, a global de-growth compact in which the rich countries stand to lose a great deal of prima facie comfort and know they will have to abandon time-honored reflexes of extraction and accumulation is a tall order. With an environmental Kyoto protocol, every political leader could still come home and try to argue that reducing emissions could still be made into a new growth engine. This proved to be very difficult in most cases, and that's why virtually no progress (beyond bouts of rhetoric) was made in Copenhagen in 2009 and in Cancun in 2010. Still, with the continuation of the Kyoto protocol looming in 2012, climate experts and environmentalists (not all of whom come across as neo-Luddites) are convinced that there is no other solution but to push greenhouse gas reductions further down. But while a post-carbon economy can be presented as a growth-boosting opportunity, a de-growth economy leading the developed world to have to rely on the long-lost virtues of stationarity, on increased social justice in the distribution of current stocks of resources and flows of goods, and on reasoned relocalization as well as selective deglobalization, is by definition not a very attractive prospect for growth as classically construed... We therefore need to create new accounting tools, new legal frameworks, and a new worldview in which anthropologically oriented, "human," relational, qualitative growth can be institutionalized into measurements and in which a materially stationary, less trade-intensive, and less hyper-productive economy can actually be seen to generate positive value and to "grow" in dimensions where today's growth-obsessed economies are faltering dismally. Herman Daly, Douglas E. Booth, and Peter A. Victor have, for quite some years (in the wake of the pioneering work of Nicholas Georgescu-Roegen), been busy trying to work out a credible framework for such a balanced, realistic global de-growth and first-world de-growth scenario, one in which third-world re-growth is included as a crucial aspect. There will be other posts in the future about this scenario and about various aspects of de-growth, since it is so crucial to the overall success of a genuine transition.

Global de-growth and first-world de-growth combined with third-world re-growth is the objective which an "economic Kyoto protocol" should aim for. With such a protocol as a major, frontline framework condition binding all nations of the planet, huge progress would already have been made towards a new logic and the possibility of justifying the need for, and action towards, a genuinely plural economy. Of course, such a protocol has no chance of ever seeing the light of day without intensive citizen advocacy and, perhaps even more so, without a set of national and supranational institutions to implement and monitor it.

The next post will argue that a fair global de-growth compact would require, among other things, the setting-up of a World Transition Organization in which the world's poorer countries have a predominant say. How such a new regulatory body might be constructed, what legal principles might make it easier for it to emerge, and what types of positive duties could be defined for the richer countries to assist the poorer countries by foregoing opportunities for economic growth -- all these procedural and substantive questions will loom large in the reflection on a politically coordinated, planet-wide growth policy.

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This post from the "Eco-Transitions" blog by Christian Arnsperger is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License.

Thursday, April 21, 2011

What transition? Part 3: Renewing the vision (Installment #3: Re-thinking the ethics of equal opportunity)

Just in case you're wondering: (1) no, I'm not actually writing up each of these posts from scratch; they are somewhat expanded and re-cast from a paper I gave at an international meeting on "Ecological and Economic Transition" in Paris, on April 13-15, 2011; and (2) no, you won't need to keep up with one post per day forever; I know you have a life, too (and if you've chosen to devote a small portion of it to reading this blog, I'm grateful); I just want to initially put up a number of entries in close sequence, and this makes it look as if all I will ever do with my workday from now on is blog and blog; actually, I'm taking advantage of the fact that my students are currently on Easter break to get this site started. It's bound to slow down at some point, and won't you just be glad it does? Okay, but for the time being, back to the treadmill. Where was I?... Oh yes.


3. Equality of opportunity, the fundamental right to experiment, and a genuine "plural economy"

If we are going to push for a new politics of prosperity, clearly we need to fundamentally renew the meaning we give today to democracy. For many decades, and certainly ever since the advent of the postwar welfare states, one of the official functions of the State has been to optimize (through decisions ranging from the municipal level to the national and, increasingly, the European and the world level, depending on the issue at hand) its citizens' insertion into the cogs and wheels of the capitalist economic machine. We saw in an earlier post that these capitalist cogs and wheels currently include public as well as third-sector employment, through the twofold "lock" constituted by our generalized dependence on (a) private-profit-financed wages and (b) the private-monopoly circulation of money. Together, these two dependencies mean that, regardless of what sector we are working in (if we have a job at all), the only reason why we are getting any money at all is that somewhere on the planet, some private firm -- and, most likely, a capitalistically driven one -- has made the profits which enticed banks to create debt-money in the first place.

We saw that despite this lock-in, capitalist social democracy does allow for a certain range of life choices. In fact, it's important to emphasize that it allows for much more choice than most traditional societies of the past or present. The range of "small" choices is huge: There are so many products to put on the market for private profit, so many services to perform in order to find a niche where financial surplus can be generated, so many strategies to think up so as to survive the competition, so many "market failures" to mend with non-market activities -- public services or associative, nonprofit endeavors -- that most of us simply don't realize how much our daily creativity, dynamism, allegedly out-of-the-box thinking, and originality are actually piggy-backing more or less invisibly on the rock-hard reality of capital-driven money creation and profit generation. I'm not saying this to make anyone feel bad -- in fact, my own activity right now as an academic using a Google blog template to diffuse "alternative" ideas is just as compromised with this lock-in as is anybody else's. I'm saying it because it means that monolithic bottom lines (ones whose evaluation criteria are sometimes quite unrelated to the very meaning of our activities) de facto rule the day. The question is, Do we agree they should? Or might we not come to the conclusion that this limited variety of choices, or rather this great variety of choices within a limited spectrum, isn't compatible with the democratic ideal, after all?

I think we do need to come to that conclusion. A genuine plural economy -- one whose inner plurality does not hang only on capitalistic bottom lines and private-profit structuring mechanisms -- can only emerge from our own life choices if, as citizens of self-declared democracies, we appeal to the ethos which our public institutions so proudly boast. Here is how we might address our political and economic elites: "We, the people who are in search of a meaningful human life and who realize that part of that meaning flows from the way we work, produce, spend, save, consume, and invest -- we, the people of this country/ region/ town that officially prides itself on being democratic, demand that this industrial-financial capitalism in which we are living bestow upon us the right to experiment with ways of life that may be non-industrial and even non-capitalist. We see this as a fundamental human right. If the incumbent economic and political institutions, as well as the legal rules, of this industrial-financial capitalism in which we are living deny us the real and full possibility of conducting such experiments in a viable and sustainable manner, we will interpret this as a deep discrimination, a blatant violation of the notion of equality of opportunity that is rightly seen as one of the pillars of our democracy."

This demand can be traced back to the threefold de-legitimation of the pro-growth consensus suggested by Ivan Illich already back in the mid-70s, in his famous book Tools for Conviviality:

"[The] political choice of a frugal society remains a pious dream unless it can be shown that it is not only necessary but also possible: (1) to define concrete procedures by which more people are enlightened about the nature of our present crisis and will come to understand that limits are necessary and a convivial life style desirable; (2) to bring the largest number of people into the now suppressed organizations which claim their right to a frugal life style and keep them satisfied and therefore committed to convivial life; and (3) to discover and revalue the political or legal tools that are accepted within a society and learn how to use them to establish and protect convivial life where it emerges. Such procedures may sound idealistic at the present moment. This is not proof that they cannot become effective as the present crisis deepens." (Ivan Illich, Tools for Conviviality, p. 101, © 1973, Marion Boyars)

All three of Illich's points require a pretty fundamental overhaul of what we believe the Sate should be doing for us. The State's -- and, in general, the various public authorities' -- main task should be to secure for all citizens an equal opportunity of access to a realized and effective, non-growth-obsessed, frugal, or convivial existence, lived on a 1:1 scale in real time and on real ground. Not as an obligation, mind you, but as an ever-open possibility. This is what democracy should be used for today, and not just as a tool to slavishly steer the mechanisms of a growth-oriented, growth-dictating capitalism which blinds people to many of the deeper existential potentials they carry inside them -- potentials that go unexperienced because of a lack of opportunities for actual economic and social experimentation. Lying at the base of the need for a transition today is the pluralistic exigency of an egalitarianism of real-life economic experimentation. This is a necessity if we, the people, are to honor the modern ethos of "econo-diversity" -- and this, as we will see starting with the next post, implies certain framework conditions which citizens have to elicit from their elected officials and unelected economic elites by devising the bottom-up processes that are most likely to lead to the right top-down decisions.

So there is clearly a libertarian flavor to my vision here. I think libertarianism, understood in the right way -- which essentially means non-right-wing libertarianism -- is a major resource for progressives. I have always been struck by how right-wing libertarians are deeply correct when they emphasize that a free society is one where initiatives emerge from the bottom up, made possible by a constitution and legal and social rules which liberate people's creativity and inspiration, and how they then blow it by equating freedom and creativity with the latitudes offered by the capitalist, private-profit accumulation system. Much worse than the right-wing libertarian thinkers (such as Hayek or, more recently, Nozick) are the neoconservative pundits and their political partners, who systematically collapse the free society, the market economy, and the logic of capitalism into one big, indistinct blob. In fact, I strongly believe in equating the free society with a society where the framework conditions are "just right" for initiatives to emerge that we think go in the "right" direction. But that also means that the content of "right" is up for grabs in a pluralistic democracy and can't possibly be preempted by the rightness criteria of industrial-financial capitalism and its cognate "democracy." And therefore, I vehemently reject equating the free society with today's capitalist social democracy. Demanding a fundamental re-casting of the notion of equality of opportunity is a crucial part of that effort to disentangle the free society from its misleading ideological doppelgangers.

What I did come away with from having pondered libertarian thought at some length is the idea that it's socioeconomic experimentation on a real-world, real-time scale, carried out under conditions of non-reciprocally destructive coexistence, which alone will make it possible for reasonable citizens (whatever their persuasion, be it capitalist or non-capitalist) to opt for this or that way of economic life. The crucial aspect of this broadened equality-of-opportunity concept is that citizens ought to be given the enforceable entitlement -- i.e., the real freedom -- to freely choose not just some intra-capitalist life style (e.g., becoming a marketing agent rather than a bank director, or creating one's own capitalist software company instead of working for Google) but to choose between an intra-capitalist way of life and an extra-capitalist one (e.g., moving to an ecovillage and exchanging goods and services within a network of user of mutual-credit currency, instead of staying in the hyper-competitive agrochemicals company with whose salary one can consume all one's fill). And, very crucially, if equality of opportunity is to be more than just a word, this latter choice -- between a capitalist and a non-capitalist way of living, working, and doing business -- should be accessible to citizens without there being excessive or disproportionate costs for them, both in terms of massive income loss (although they may well, in some cases, be content with less purchasing power if this buys them a qualitatively better life) and in terms of a loss of basic rights (such as health care, social security, free education for their kids, a pension, etc.). To the extent that such large and often prohibitive costs do exist in today's system, citizens who would like to experiment with a different life are the victims of a form of systemic sanction, and the principle of equality of opportunity is breached in a blatant fashion.

All too often, so-called "marginal" actors in the economy are relegated into a secondary status because they are simply not recognized as playing an important social role -- that of being at the forefront of multifarious, creative, difficult, sometimes even hazardous real-life experimentation. The fact is that one of their basic human rights, which is to apply their own evaluation criteria and their own brand of bottom line in a viable everyday life, is simply not respected. Warren A. Johnson has insisted heavily on this pioneering role played by apparently outcast or "losing" populations within our system:

"The frequently heard criticism that says these people are 'dropouts,' and that they do not contribute their skills and energies to solving society's problems, is totally wrong. They are doing a task that is essential for our future, developing new skills and ways of living that will provide models for others as necessity pushes more of us in that direction. Nothing could be more important. The pioneers are opening up new economic territory where subsequent settlers can join them. (...) Any alternatives that might evolve, whatever their form or function, will make a major contribution to the economy and to the choices available to people. If their numbers were to increase substantially, it is possible that the shortfall in jobs [in the mainstream economy] could be reduced, greatly easing the adjustments to [macroeconomic] scarcity. But whatever their numbers, successful communities will be valuable additions to the range of models available to others in the future. New communities may have to struggle for a long time before getting firmly established, but this should not be held against them; it is characteristic of the muddling process." (Warren A. Johnson, Muddling Toward Frugality, pp. 149-150 and p. 153, © 2010, Easton Studio Press)

Full equality of opportunity never has meant that anyone could do whatever he or she chooses without facing any of the limitations linked with the fact that there are other models being experimented in parallel. Full equality of opportunity requires, rather, that each citizen be endowed with the maximally possible economic means, as well as the necessary social and legal resources, in order to be able to experiment his or her values and to promote the corresponding evaluative and normative criteria in a viable everyday life. This basic fairness requirement is not fulfilled when one's most basic economic and social rights (unemployment support, health care, education, or pension) hinge on one's sole willingness to participate in the range of life experiences offered by today's globalized industrial-financial capitalism. "Marginal" people de facto suffer what amounts to systemic sanctions, due to the way our social democracies calibrate (a) the juridical attribution of rights and (b) the modes of redistribution of capitalist primary wealth.

A genuine transition -- one that would be carried out democratically and that would be based on transparent, open, public deliberation so as to expose the existing power imbalances -- should aim to discredit (through rational argument and impartial analysis) the "monopolization" of primary-wealth creation by those actors who are following a capitalistic logic. A genuine transition should rely on an extended and deepened principle of equality of opportunity to question the link which has come to be established, over a century and a half of hegemonic capitalism and after numerous decades of social democracy, between socioeconomic rights and citizens' participation (whether direct or indirect) in the dominant system. Sure enough, merely to affirm an extended equality-of-opportunity principle is vastly insufficient -- but I deem it utterly necessary as a philosophical and political wedge to be driven between the sphere of socioeconomic rights and the sphere of economic wealth creation. That's why re-casting equality of opportunity is a crucial component of the new vision I am proposing.


This wraps up Part 3 of this long series -- something for which, surely, you are grateful. In Part 4, which will also come in several installments, I will go into more detail about (some of) the main framework conditions which bottom-up citizens' movements should advocate with their top-down decision-makers. This will allow us to have an idea of the overall transition project and of the horizon towards which I think it should be oriented. In Part 5, which perhaps (but just perhaps...) might be a bit shorter, I will then start getting back to today's realities and ask myself to what extent the Next-Step Economy -- the only one we can construct, given the economy and the political system we have now -- can be oriented towards this horizon while remaining the inevitably messy, ambiguous, sluggish, and error-prone "muddling-through" process that it is.

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This post from the "Eco-Transitions" blog by Christian Arnsperger is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License.

Wednesday, April 20, 2011

What transition? Part 3: Renewing the vision (Installment #2: Making prosperity into a political issue)

2. Making prosperity into a political issue: Pluralism, dissensus, and "muddling through"

The currently dominant logic rests on the idea that capitalistic incentives, which channel the behaviors and decisions of major actors as well as of all but the poorest of us through a set of markets for goods, services, and financial assets (a maximally deregulated set of markets, hence a maximally globalized one) -- are the vector par excellence of collective prosperity. The latter is measured by real GDP per capita, i.e., the volume of monetary transactions during a given time period (usually a year), deflated by an aggregate price index to filter out objectionable inflation. (Objectionable, that is, to those who own financial assets and stand to lose from even moderate price hikes.) This is clearly a holistic, monolithic vision of prosperity: one single synthetic indicator, one single reference monetary unit (put into circulation in monopolistic fashion by commercial banks in accordance with private-profitability considerations), and one single criterion for the inclusion of a good or a service in collective wealth -- namely, the fact of having been the object of a market transaction, markets being the place where goods, services, and assets are exchanged ultimately according to the overarching principle of maximal net valuation of capital.

Of course, when I say it's a monolithic vision of prosperity, I am not thereby denying that there there is room for a certain degree of internal pluralism. Within our social democracies, capitalistic incentives and the way they generate income and wealth can accommodate a kind of "plural economy" that includes a public sector as well as a variety of non-profit, "third-sector" private actors. It's all a matter of channeling part of the capitalist profits -- which are the sole source of monetary irrigation of the system, since commercial banks only actually lend when they can be sure that some sufficient chunk of private profit can return to them in the form of principal plus interest -- into tax incomes (directly on private profits and indirectly on profit-derived wages) which are then redistributed in the form of public-sector wages and third-sector subsidies. So there is no question that capitalism currently supports a variety of non-capitalist endeavors. However, upstream from this redistribution of primary incomes, the way the system produces these primary incomes and the corresponding means of payment (and the way part of these incomes is immediately, year in and year out, raked back by the banking system in the form of interest) implies some pretty strong homogenizing constraints on what sort of economic activities and philosophies of life are actually feasible and viable.

The latitude for this private-capital, private-banking-money irrigated, "plural" economy to be a genuine vector of deep change is, in actual fact, strongly restricted. The third sector is completely dependent on tax incomes out of profits, and so is the public sector. One single currency is supposed to be the means of solving all ecological, economic, and social problems, so if you don't get your hands on some dollars or euros -- however far away they were created, and for whatever private-profit purpose -- you have no way of changing things even if you want to. This, of course, explains why so many "alternative" actors end up caught in the ambiguities of having to raise money with large corporations, private-capital foundations, and commercial banks... and why, in the wake of this bank-induced crisis of private capital, so many of those well-meaning "alternative" endeavors have simply had to close down, while we are all holding our breath waiting for corporations and banks to make money again so that we can hope to re-launch our alternative activities and commitments. It all hinges on one single criterion of prosperity: GDP has to be larger this year than last year, and the increase has to be substantial enough so that there's enough of a surplus left after interest has been paid on all outstanding debt -- that is, on all but 5 percent of the money in circulation. That's a pretty tall order and it doesn't seem to get filled these days. (As Tim Jackson has so rightly put it in Prosperity Without Growth, in a system where positive real growth is a structural necessity, when that growth stalls everyone suffers.)

Now one of the foremost priorities of the transition will be to maintain and significantly deepen and enlarge a genuinely plural economy. And that means that our democracies should allow for the fully-fledged coexistence of various -- capitalist as well as non-capitalist -- conceptions of how to produce, how to organize work, how to distribute incomes, how to obtain financing, how to save, and how to consume. This idea of coexistence is absolutely crucial: If I have learned one thing from reading Warren A. Johnson's work (and I have learned many other things, too), it's that the revolutionary idea of replacing industrial-financial capitalism wholesale with one single new, shiny, "post-capitalist" model is an absurdity. It just won't work, ever. The only thing we can really do is push the ethos underlying our self-proclaimed democratic ideals much further, and use the resources of the Greek words "demos" and "kratos" to deepen the functioning of our social democracies in ways that are, until today, unheard of.

This means, for instance, and quite significantly, scaling up the tired slogan of the "Green New Deal" and making it the basis for a deep overhaul of our income-redistribution model -- one that will allow citizens to make a true choice between different options. I'll get into the details of this in later posts. (This blog is becoming a landslide of sorts, isn't it? Oh well...) For now, let me just say that the broadening of choices is going to have to rely on a smooth transition from the mainstream economy towards a plurality of alternative economic forms, and that won't happen if we just dismantle or demolish the incumbent wealth-creation engine too soon. Transition is all about keeping industrial-financial capitalism alive and well as long as possible, letting it go green if it sniffs out new profit opportunities there, but using the proceeds of the resulting taxation of private profits to usher in a plurality of non-capitalist alternatives, grounded in heterogeneous conceptions of what prosperity means: cooperative economies, solidaristic community economies, ecovillage networks, "plenitude"-driven self-provision economies, intentional economies of various sorts, all endowed with their own legally sanctioned and legitimate criteria for what value creation means -- and, therefore, frequently at odds with the idea that to create wealth a firm, a community, or an intentional collective has to ultimately sell something in legal-tender dollars at a profit. That way, we might sustain a green-capitalist economy for a while and then gradually see it dwindle by itself as more radical alternatives become viable. (A great place to start reflecting on the variety of post-capitalist alternatives is J.K Gibson-Graham's remarkable book, A Postcapitalist Politics, published in 2006. It offers a radically pluralist political philosophy as well as an in-depth discussion of existing practices and some great taxonomies to put some order into a messy landscape of "alternatives.")

Such a deep, enacted pluralization of the debate on prosperity is no simple feat, to be sure. It carries requirements that go way beyond, say, the mere legal recognition of a variety of property regimes for firms or of a plurality of statutes for associations and collectives. All this we already have (admittedly, with differences across countries and continents), and it isn't working. Cooperatives are faltering, alternative collectives are gasping for air and cash, ecovillages survive on capitalist perfusion, i.e., some of their members have to go on working for their whole lives in mainstream organizations, or to go sell their produce to mainstream clients, just to get at the means of exchange that will make even the most basic purchases possible -- and those means of exchange are invariably those darn dollars and euros, without which you can't do anything at all. The fact is that we're simply used to the idea that non-capitalist alternatives need to be, at the end of the day, evaluated with capitalist criteria -- in particular, that it's only normal that they, too, should pay back standard bank loans and pay their taxes in legal tender. In the monolithic context where we live, this perception is normal, but we need to be aware that it's these powerful homogenizing constraints which imply what we're, in fact, observing: Non-mainstream alternatives frequently stay feeble and partial, they don't offer a whole lot of real livelihood possibilities, because they are strangled by mainstream bottom lines; and this means that these alternatives only get to occupy whatever niches have been left vacant by the dominant actors who control the issuance and circulation of the means of payment and who, for reasons of profitability, prefer to go and invest the bulk of their capital elsewhere.

What we need, in terms of vision, is the project of a truly free society -- one in which, to put it a bit bluntly, various socioeconomic projects are able to compete on an equal footing for the minds, hearts, and time of citizens. And this requires us to envision a new politics of prosperity: Several competing notions of prosperity, not necessarily mutually exclusive but certainly not reducible to one another, and not all reducible to some chunk of GDP, should be allowed effectively to co-inhabit our socioeconomic space -- I mean the mainstream, industrial-financial capitalist notion of prosperity as well as a variety of more or less radically non-mainstream ones. Therefore, each socioeconomic alternative should be endowed with the appropriate accounting, monetary, and legal tools that will make it possible for it to really unfold (rather than be stifled right away by ill-adapted bottom lines and evaluation criteria) and show all it's got, in terms of offering people opportunities for flourishing, prospering, and finding meaning in life. And citizens should effectively have the cognitive as well as financial means of choosing one such alternative, or (of course) of staying put within the mainstream if that's what they aspire to. (I'll come back to this in a later post, but let me just say immediately that it won't do to foster alternatives through selective subsidies, in the way we today foster associative ventures or the arts, effectively making them into the contemporary equivalent of the infamous Indian reservations. A much less conditional form of universal income support has to be introduced if the idea of enacted plurality is to work in a bottom-up, non-bureaucratic fashion.)

This means that prosperity has to become a political issue, rather than merely a technical one. And in this process of becoming a political issue, the notion(s) and practice(s) of prosperity need(s) to be become part of a twofold dynamic which John Michael Greer, taking his cue in part from Ewa Ziarek and Warren A. Johnson, has identified as "dissensus" and "muddling."

In the age of democracy (at least as an officially proclaimed ideal, if not as a realized ethos), conscious evolution cannot be decreed. There can be no such thing as forced conscious evolution. You can bring a horse to the water, but you can't force him to drink... What is required is a broad latitude for citizens to experiment with different ways of life. Such a latitude is, in fact, one of the pillars of the ethos of modernity. The political vision that guides the transition therefore needs to be one which affirms (not just rhetorically, but in action) the positive value of plurality and diversity when it comes to organizing individual economic options and collective economic projects. In a sense, the ecological principle of biodiversity needs to be translated, socially and economically, into what I will call a principle of econo-diversity: There is value, in a free society, in the fair coexistence of varied and mutually limiting, but not mutually destructive, visions of economic prosperity. Sure enough, no economic project -- be it mainstream or alternative -- can ever unfold without regard for the viability of other projects (this, too, is a fact of life in a pluralistic society). Competition between economic visions will be fierce at times in an "econo-diverse" society, but that's precisely the idea: We need it to be fair competition, and hence we need to give each vision the largest possible chances of attracting citizens on its own terms. (I developed an analogous argument for fair competition between economic theories in a free society, in my book Critical Political Economy, Routledge, 2008. In this blog the emphasis is less on pre-given economic theories and more on evolving economic visions, linked to ways of life which are self-creating and self-transforming as they are being experienced in real time.)

In this context, John Michael Greer calls for what he calls, after Ewa Ziarek (in her book An Ethics of Dissensus), a culture of "dissensus." In the face of major uncertainty as to future scenarios (how damaging climate change will be and how soon, and how steep the decline in non-renewable energy sources might turn out) and as to the practical solutions that will emerge over time (which economic practices, which types of communities and organizations, which sorts of tools, etc.), Greer believes that "encouraging people to pursue conflicting and even diametrically opposed options increases the chance that someone will happen on an answer that works. Dissensus is not simply the vacuum left by a lack of consensus. It has its own methods, values and style, and its results differ in kind from those of consensus or other methods of decision-making such as majority rule." (John Michael Greer, The Ecotechnic Future, p. 96, © 2008, New Society Publishers) A genuine democracy will accept that dissensus between its citizens reaches all the way down to the overall economic projects they adhere to and seek to enact in real time, on a real 1:1 scale. This is not what today's post-WWII, capitalist social democracies do -- they allow for a lot of verbal and intellectual disagreement, but not for very much enacted plurality based on real-time dissensus. (Indeed, both third-sector private actors and public officials are forced, by the way they are being subsidized and financed, to de facto share the vision of prosperity enacted on an everyday basis by the capitalist and for-profit private sector.)

Directly connected to the notion of dissensus is another key concept -- that of "muddling." Here Greer's idea, inspired by Warren A. Johnson, is that "the basic strategy of muddling has much to recommend it" because, basically,

"no one knows what an ecotechnic civilization would look like. (...) What we do know is that certain things are not working now and need to be changed; and that certain things that still work may not work for long, so that having replacements handy is probably wise. In a situation of this sort, betting everything on one grandiose plan for the future is a poor bet. A wiser approach would encourage many different responses to the situation. In the same way, piecemeal responses that focus on narrowly defined dimensions of the crisis and can be implemented on a small scale before moving to a larger one may be more useful than grand attempts to change everything at once. Thus embracing an adaptive approach to the situation, and then simply to adapt, may get us further than any plan at all. Solvitur ambulando is an old Latin phrase that still gets a little literary use in English these days. Taken literally, it means, 'it is solved by walking.' A more idiomatic translation might be, 'you'll find the answer as you go.' An adaptive approach to the crisis of industrial society could well take this as a watchword."
(John Michael Greer, The Ecotechnic Future, pp. 93-94, © 2008, New Society Publishers)

According to Warren A. Johnson, one of the virtues of our democracies is that, despite the fact that the political elite is being deeply co-opted by the economic elite (and and is also happily co-opting the latter), they allow for about as much sluggishness and inefficiency as might be needed to avoid ideological hold-ups and one-sided solutions. (He may have been rendered a bit less optimistic by the Bush years, where crony capitalism and pseudo-messianic grandeur were reigning supreme, but his general point seems quite valid.) Here is how Johnson puts it:

"To the spokesman for specific industries, regions, labor unions, conservation groups, minorities, and radicals of all colors, the issues are clear. But to the politician surveying the scene, it is not clear at all. The genius of our political system is that it provides an arena for the controlled conflict of competing values and ideas. It permits the resolution of conflicts without civil war. (...) ... the process of muddling through is a gutsy, down-to-earth process full of inefficiencies and inconsistencies. It takes an inordinate amount of time to take modest incremental steps forward, and significant bold steps are clearly not in the cards. The process can be a lot of fun for those who enjoy it and do not take themselves seriously -- the politician who loves to talk to people, the lobbyist who thrives on finding ways to gain access to the influential, or the activist who enjoys organizing people. It keeps this country [the U.S.A.] pretty close to the middle of the road, while still permitting slow, faltering adjustments to change."
(Warren A. Johnson, Muddling Toward Frugality, pp. 115-117 passim, © 2010, Easton Studio Press)

Now of course, we shouldn't overdo it. Muddling-through is a good bulwark against crazy visionaries and revolutionary zealots, and it certainly makes it somewhat more likely (all the more so in contexts where coalition governments make most decisions very cumbersome and slow) that more of a plurality of projects and visions of prosperity might one day be honored. However, when muddling-through slips towards lack of transparency, corruption, or oligarchy, things might actually look bad for economic plurality -- and this is what occurred, for instance, under the Bush administration and is occurring, in a sense, under the Sarkozy government in France. Muddling isn't a guarantee that the monolithic, GDP-oriented view of prosperity gets dethroned. It's a necessary condition, but certainly not a sufficient one. In fact, its necessity itself has to be qualified by an important aspect which I already highlighted in the previous post: In order to effectively organize a "pluri-economic" society, we certainly will need certain particular, top-down, across-the-board framework conditions to be put in place. The framework conditions we will need in order to get a genuine transition off the ground are not quite the same as the "mono-economic" conditions ruling today's capitalist social democracies.

Ultimately, there's no way around the fact that we don't need just any old kind of muddling-through; we need transition-oriented muddling-through, and this means that the mechanisms of both parliamentary and participatory democracy have to be monitored and scrutinized by transition-oriented citizens' organizations. So in the end, it all comes down to how we are going to generate sufficient awareness of the requirements of transition in the population at large -- and that, regardless of how much one might be attracted to bottom-up perspectives, is a top-down issue just as much as a bottom-up one... But lo and behold, the distinction is rendered moot by the fact that, in a genuine democracy (that is, in a society where citizens can reflect on, argue for, and directly or indirectly express judgment on, measures and changes without a privileged class having the de jure capacity to overrule them), the top-down decisions instigating changes in framework conditions are bound to flow from bottom-up activism! Bottom-up processes don't exclude advocacy of top-down decisions -- the actors involved simply want to ensure that the top-down decisions that are made will end up catering in the right way to the aspirations and visions voiced through the bottom-up processes.

So at the end of the day, the name of the game isn't bottom-up versus top-down, but which combination of the two, subject to what rules of deliberation and to what values to be promoted, will bring about a genuine transition. And if you think "genuine" is an open-ended word in that context -- well, you're perfectly right. That's the whole point: solvitur ambulando. Unsatisfactory to the fiery radical, weak and self-defeating to the staunch realist, but absolutely necessary for a plurality of visions of prosperity to compete for citizens' minds and hearts not just as dogmatic answers, but as deep-searching questions: What future do we want? What, in the end, is the purpose of work? Why consume, and why not more, and why not less? What's enough? What is money, and why shouldn't there be several currencies? -- to list but a few.

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This post from the "Eco-Transitions" blog by Christian Arnsperger is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License.

Tuesday, April 19, 2011

What transition? Part 3: Renewing the vision (Installment #1: Trade selectivity and reasonable relocalization)

The previous post ended with a call for replacing blind evolution (which has driven the genesis and succession of socioeconomic systems up to today) with conscious evolution. This is not some hazy new-age idea, although the expression "conscious evolution" has been used in hazy new-age contexts, too. The recent history of the developed world, and in particular the emergence of social democracy between the two World Wars and especially after WWII, has shown quite clearly that we have reached a new stage -- a stage where the conscious design of mechanisms permitting free emergence has taken over from the older notion of Adam Smith's "invisible hand." Smith's vision involved the unconscious and un-designed emergence of mechanisms (e.g., the market) which allow you to realize your freedom if you're lucky enough to come out on the right side of those mechanisms. We need something more.

Social democracy has been a first step in the direction of making the invisible hand more deliberate. I don't intend to argue that we should roll back those positive steps. Instead, we should push forward. The industrial-financial-capitalist version of social democracy which we are currently presented with as "the" embodiment of a modern, progressive economy is actually just an initial stage of social democracy -- not its final achievement. (In the same way, John Michael Greer has argued in The Ecotechnic Future that today's industrial civilization is merely an initial stage in what he calls an "ecotechnic age" that is going to involve, or so he believes, centuries of groping for, and muddling towards, more ecologically and socially sound technologies.)

Here I would like to delineate the broad change of vision (sorry for those readers who are allergic to "grand" tapestries -- this is going to be one of those...) which I believe we need in order to usher in a new phase of conscious evolution into our economy. I want to make it very clear right at the outset that I am not -- I repeat: not -- going to argue for centralized planning or any other authoritarian device. The transition we need is as far removed from any sort of crypto-Soviet model as you could possibly want. (But don't take my word for it. Read on and you'll see.) It has many libertarian features and it emphasizes bottom-up decision-making as well as decentralized governance. We can't avoid top-down decisions and measures, but they have to be designed in such a way that they very quickly, by the very nature of their design, hand over power and energy to bottom-up processes -- indeed, that they actually create such bottom-up processes where they don't yet exist.

The transition, if it is going to be desirable despite the difficulties involved, will be first and foremost a matter of democratic coordination so that the "economic minorities" (i.e., those who wish to move towards non-mainstream lifestyles in a society that remains hooked to the mainstream) as well as the incumbent "economic majority" (i.e., those who, for various reasons ranging from ideology to comfort to fear, want to remain within the mainstream spectrum of lifestyles while they wait to be convinced to change) are allowed to coexist while, at the same time, not stifling each other's aspirations more than what is at all necessary to keep society from imploding. Needless to say, the current state of capitalist social democracy isn't in line with this requirement, or so I will argue here.

There will be three separate installments in order to avoid that this post becomes a mile and half long. This is the first installment.


1. Trade selectivity, subsidiarity, and participatory coordination

Deglobalization and relocalization have certainly not yet reached the top of political agendas, and this is due to many factors, but I suspect that the two main ones are the following. One, opulent citizens generally worry that their lives will become dreary and contrived if fewer consumer goods are available, if less long-distance travel can be done, and so on. And two, the power relations in the political-cum-economic sphere (where the elites are getting together) are skewed towards the flawed responses I described in Part 2, one of which is to rev up trade and competitiveness in such a way as to keep economic growth going. (And emerging countries, as well as aspiring ones, certainly have no qualms in going along with this idea. Never mind that it doesn't seem to lead to very much trickling-down of wealth to the poor and meek at all...)

Arguing in favor of deglobalization and relocalization can be done on the basis of any number of more or less alarmist scenarios about accelerated climate change, the imminence of the peak in oil extraction, or the fact of deepening human dis-adjustments due to globalization. (One book that presents a credible spectrum of scenarios, ranging from the exalting to the downright scary, is David Holmgren's Future Scenarios.) In fact, it isn't so much a matter of arguing for or against it, as if it were a sheer matter of ethical options or, worse still, of mere opinion. Those who -- from the side of the environmental sciences as well as from the side of culture- and psychology-infused social science -- think that a genuine transition towards more sustainable economic practices is paramount view the reduction in the volume and the geographical reach of economic exchanges (including raw materials and semi-finished manufactured products) as one of the main necessities dictated by reason in our time.

This is not a matter of ideology, nor does it have anything to do with "protectionism" as a covert strategy to secure domestic or local producers' profits and niches. (This strategic use of protection to cater to wealthy special interests is rightly denounced by trade economists and lawyers.) Nor is it a neo-luddite plea against production, consumption, and trade. I have read challenging and even enticing books dealing with the virtues of increased self-sufficiency, such as Sharon Astyk's Depletion and Abundance (a truly remarkable book for its rigor and wonderful sensitivity), but most authors I draw my inspiration from are keenly aware that domestic or very small-scale self-sufficiency is a thing of the past, linked to poverty and destitution and lack of access to basic capabilities -- and they argue, at best, for a deliberate and reasoned selectivity in trade to replace today's no-holds-barred, anything-goes anarchy in trade flows. The problem isn't trade per se -- not at all. Trading is a vital, and often enjoyable, part of economic life. Local market squares as well as shopping streets are among the richest places in terms of human interactions and enjoyment of life. The problem is the political-economy option we have taken, and inscribed between the lines of our macro-rules such as those of the WTO, of viewing any and all trade as potentially beneficial and not questionable as to the possibly perverse effects of excess mobility and of export-led "development."

The wedge between self-sufficiency and relocalization is called subsidiarity. It means, quite simply, that political and economic decisions ought to be made at the level that is most relevant given the underlying issues. In this case, it means that whatever can be produced at level n should not be imported from any place located at a distance on level n+1 -- even if the criterion of comparative advantage (which discards all environmental as well as cultural issues which cross-border trade carries with it) says some other place on the planet should produce it. One of the key aspects of this discussion is how we are going to reinterpret what mainstream trade economists are bound to call the "deadweight losses" to consumers of an incomplete division of labor. The main avenue here is to recover a sense of what a local economy means, and what its intrinsic value might be on top of whatever instrumental benefits we might derive from planet-wide trade flows. In this context, I hope I may be permitted by Counterpoint to quote a page-long passage from Wendell Berry's 2001 essay entitled "The Idea of a Local Economy" (reprinted in his collection, The Art of the Commonplace, pp. 249-261):

"So far as I can see, the idea of a local economy rests upon only two principles: neighborhood and subsistence.
"In a viable neighborhood, neighbors ask themselves what they can do or provide for one another, and they find answers that they and their place can afford. This, and nothing else, is the
practice of neighborhood. This practice must be, in part, charitable, but it must be economic, and the economic part must be equitable; there is a significant charity in just prices.
"Of course, everything needed locally cannot be produced locally. But a viable neighborhood is a community; and a viable community is made up of neighbors who cherish and protect what they have in common. This is the principle of subsistence. A viable community, like a viable farm, protects its own production capacities. It does not import products that it can produce for itself. And it does not export local products until local needs have been met. The economic products of a viable community are understood either as belonging to the community's subsistence or as surplus, and only the surplus is considered to be marketable abroad. A community, if it is to be viable, cannot think of producing solely for export, and it cannot permit importers to use cheaper labor and goods from other places to destroy the local capacity to produce goods that are needed locally. In charity, moreover, it must refuse to import goods that are produced at the cost of human or ecological degradation elsewhere. This principle applies not just to localities, but to regions and nations as well.
"The principles of neighborhood and subsistence will be disregarded by the globalists as 'protectionism' -- and that is exactly what it is. It is a protectionism that is just and sound, because it protects local producers and is the best assurance of adequate supplies to local consumers. And the idea that local needs should be met first and surpluses exported does not imply any prejudice against charity toward people in other places or trade with them. The principle of neighborhood at home always implies the principle of charity abroad. And the principle of subsistence is in fact the best guarantee of giveable or marketable surpluses. This kind of protection is not 'isolationism.' "
(Wendell Berry, "The Idea of a Local Economy," pp. 260-261, © 2002, Counterpoint)

This quote clearly does not exhaust all problematic issues linked to striking a balance between openness to trade and the protection of local producers and local values. Far from it. Berry is more than a bit idealistic about the readiness of many local producers to use the protection bestowed on them in order to maximize the surplus to be given and/or sold at a fair price to foreigners who need them. He seems not to take into account the experience of past bouts of protectionism, such as the Smoot-Hawley Act of 1930 in the U.S. (see Douglas A. Irwin, Peddling Protectionism), which were mainly devices to secure rents for local producers concerned with their private interests rather than with the general interest.

However, I take Berry to mean that deglobalization has to be judicious, and therefore selective, and that relocalization has to be reasoned. It isn't a catch-all solution to all problems -- but then, neither is free trade. Selective deglobalization would imply, in particular, that there be political coordination -- with intense citizen participation -- as to the legitimate and illegitimate uses of fossil fuels and other non-reneawble energy sources (as well as of renewable ones, of course). It would also imply that each citizens' group, anchored within a suitably defined "bio-region" (see e.g. Kirkpatrick Sale, Dwellers in the Land: The Bioregional Vision), be able to determine which goods and services it needs to import and which ones it deems necessary, or at least possible and desirable, to have manufactured and distributed locally. The idea is not at all to isolate bio-regions from one another, but rather to ensure local resilience (as opposed to a volatile world market economy in which more and more "fire doors" are being dismantled) so as to make subsequent cross-region trading innocuous and, actually, truly optimal because the rationale for trade (as well as for protection) will then have been, as much as at all possible, disconnected from special interests thanks to widespread democratic participation subject to the usual countervailing powers and checks and balances of a messy citizen-based decision process. (There is a wonderfully instructive chapter on this democratic "muddling" in Warren A. Johnson's book, Muddling Toward Frugality, pp. 105-117.)

What I am advocating is not a vision of extreme localism. The relevant regions have to be large enough so that a significant division of labor can occur in them, so that a large number of goods and services can be forthcoming with the help of local talents, and so that economic activity is lively and vibrant, including the development of local "short circuits" and local "soft" transport options. The non-local, "hard" transport options -- such as road or air traffic, which will still involve the use of fossil fuels for quite some time -- need to be reserved as much as possible for (a) whatever cross-border trade still needs to be carried out (and that may quite a lot, especially in the early phases of the transition) and (b) what George Monbiot, in his jarring book Heat, has ironically called "love miles": the travel of persons for the sake of family, affection, love, or other human bonds.

All these choices need to be made through some multi-level coordination device. For reasons which ecological economists understand better and better today, the current capitalist market economy and its short-term pricing logic is unable to accommodate such complex issues, be it only because most producers as well as consumers simply do not have enough of an interest to integrate medium- and long-term aspects into their outputs and their purchases. The market is not about to disappear, but it needs to be supplemented by alternative devices which are more deliberative and qualitative in nature. This is why, as we will see again in later posts, a crucial component of the transition has to be the deepening of decentralized, participatory, bottom-up decision processes that can be summarized under the heading of "participatory economics," as spearheaded a.o. by Michael Albert and Robin Hahnel in several pathbreaking books in the 1990s and 2000s. The basic idea of participatory decision-making is that nested popular assemblies send "up" to level n+1 data about level-n consumption, work, and production plans, the data get aggregated and sent "up" to level n+2, and so on. (The basic mechanism is described, for instance, in Michael Albert, Parecon, Verso, 2003, Part III.)

As Robin Hahnel has emphasized quite rightly in his excellent book Economic Justice and Democracy, since total regional self-sufficiency is illusory (and I agree it is), what we really need is a multi-layered governance structure which allows various coordination agencies at the municipal, regional, national, and international level to compute "full-reality" prices which will take into account not just short-term, quantitative profit-seeking and goods-buying, but also qualitative aspects linked to working conditions and to the types of goods we ought to produce (so as to integrate the anthropo-environmental internalities into the allocation mechanism), as well as longer-term and planet-wide quantitative information about the side effects created by economic activities (so as to include the bio-environmental externalities into allocation, too). As Albert and Hahnel have endeavored to demonstrate (in particular in a rather technical but enlightening book entitled Quiet Revolution in Welfare Economics, published in 1990), neither central planning nor the competitive market are able to perform the complex qualitative-cum-quantitative tasks that democratic coordination can. And just as democratic coordination needs nested decision-making that goes all the way down to small localities (communes, barrios, arrondissements, etc.), by the same token it needs national and supra-national decision-making instances as well. Democratic (and possibly participatory) decision-making all the way down, as it were, but also all the way up.

So, to conclude, the basic idea here is not relocalization on the basis of any neo-luddite, or "Little House in the Prairie," vision of plain and simple, small-sized, "human-scale" communities. Such communal rootedness does have its rationale within the new framework conditions we'll need, and I'll come back to it later. But let me just emphasize that my only reason for integrating deglobalization and relocalization into our new vision at this point is that ecological as well as human problems simply make them an eminently reasonable response. This is why there is no dogmatism here -- just an attempt to pragmatically pose the question of deglobalization and relocalization as a problem in selecting the reasonable extent of globally-oriented viz. the reasonable extent of locally-oriented activity. Trade and mobility are not seen here as problems in themselves. What is a problem, however, is when there are no properly designed decision and coordination instances which can introduce a modicum of hierarchy and priorities into the anarchy of anything-goes trade and mobility -- which means, essentially, that we leave it all for the market to decide, and we ought to know what that implies: "one dollar, one vote," and if you have no money you cannot effectively express your aspirations and demands on the market. This, it seems to me, is not a properly designed device for today's problems.

In the two next posts, I will offer installments #2 and #3 of this Part 3 devoted to vision-building:
  • Main political challenge: to introduce plurality into our discussion on the meaning of economic prosperity
  • Main political/philosophical tool: a renewed concept of equality of opportunity, which will allow us to subsequently justify framework conditions that make room for a plurality of economic life-choices

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