What if there is no such thing as a socialist “economy”?

by Jehu

chaplin-charlie-modern-times_01According to a post on the NorthStar blog by Gavin Mendel-Gleason and James O’Brien, at least part of the problem socialism has gaining purchase among the working class is that socialists have difficulty describing what it will look like:

“Nothing springs from the naked void fully formed. We need to examine the best avenues open to us for changing our current social direction into a society we would like to bring into existence.”

This is creating a problem for socialists, because, as the writers explain, socialists have so far been unable to coherently describe the society they propose to replace the present mode of production:

“Socialists are often loathe to get into the exact details of what a socialist economy would look like. This is caused, perhaps in equal measure, by complete ignorance and an extensive knowledge of just how large the space of possibilities is. Indeed many proposals have been given about how a socialist economy might best be run.”

And here, of course, the problem only gets worse.

Realist versus Utopian ideas of communism

Socialists have so far been unable to even agree that such a description is necessary. There are “realist” schools, like wertkritik which have met this difficulty by proposing to limit themselves to a negative critique of the existing mode of production, but others of a more “utopian” bent who have sought to put down on paper in some details how the new society should (will?) be organized.

Mendel-Gleason and O’Brien, appear to fall into a third group: admitting some vision of the new society must be provided, but that we cannot limit ourselves solely to a vision of the future. The writers think our vision of the future must be expressed in present activity through experiments at post-capitalist enterprises:

“The question of which system is desirable, in detail, is quite important. Unfortunately we cannot determine in abstract which system will work best and what problems will develop, though we can make guesses. To fully understand the consequences of an economic system can only be decided experimentally. This leads us to the chicken and the egg problem. How can we promote a new system without knowing what it will look like and if we don’t have a new system to promote, how can we convince the broad masses that we should remove the presently existing system – however deformed our present system becomes.”

Following an argument made by Milovan Djilas, Mendel-Gleason and O’Brien have concluded that the change in the mode of production might need to precede the revolution. They argue cooperatives can be one important way of establishing a “beachhead” for communist relations of production before communism actually emerges. And they build their case by referring to the favorable view held of co-ops by the First International and by Marx. Both of the latter held that, while problematic,

“the co-operative movement [was] one of the transforming forces of the present society based upon class antagonism. Its great merit is to practically show, that the present pauperising, and despotic system of the subordination of labour to capital can be superseded by the republican and beneficent system of the association of free and equal producers.”

The first international advised workers to engage in cooperative production, rather than cooperative stores. It made clear, however, that “the co-operative system will never transform capitalist society.” The latter required, “transfer of the organised forces of society, viz., the state power, from capitalists and landlords to the producers”. In other words, although pointing to cooperatives as a potentially important adjunct to the class struggle, the international did not believe co-ops could serve as a substitue for the class struggle.

Mendel-Gleason and O’Brien acknowledge this, but believe they have figured out a way to get around the objections. In first place, they do not propose the cooperative movement as a substitute for the class struggle, but as prefigurative forms pointing to the sort of relations that will emerge after a socialist revolution. In second place, they try to address some of the practical problems of creating and sustaining cooperatives like the lack of capital and markets.

Is there a socialist economy as such?

I think, however, the argument, although not to be dismissed as completely utopian, stumbles on an essential and unavoidable fallacy. To describe the fallacy clearly requires us to ask a simple question: Is it true that socialists cannot describe the details of a socialist economy because of ignorance or the range of possible socialisms? Suppose the problem socialists have explaining the details of a socialist economy is that there is no such thing as a socialist economy? Socialists, in this case, would be trying to explain the details of something that, by definition, could not exist.

Let me explain what I mean.

First, it could very well be that once the law of value is replaced by the association of producers, describing the “economy” of this association is redundant. What is “the economy of socialism”? It’s an association of producers; in this association, the producers have subordinated the production of use values to their needs — they reduce everything we presently call “the economy” to a mere economic organization under the complete control of the producers. These material needs no longer appear to the producers in the form of a law of value imposed on them that determines their activity through a series of forcible adjustments. In large measure what is meant by the term “the economy” is this alien force determining the economic activities of society.

Since the law of value no longer exists, there is, in reality, no “economy of socialism” as such, but only the decisions arrived at by the producers. Once the association arrives at certain decisions, the labor required to make these decisions a reality, follow almost automatically. Having made a decision on the division of the product of labor into so many parts, actual labor must now be apportioned in reality in accordance with this. So much labor for immediate consumption, such and such an amount for new means of production, a certain measure of labor for those unable to work, education, healthcare, etc. These divisions of the total labor time of society have been arrived at beforehand by the association and are not imposed on society after the fact through exchange.

Insofar as we could call this an “economy”, describing it is not even interesting, nor does it pose any necessary theoretical problem — it is more akin to describing the logistical operations that keeps Wal-Mart’s shelves stocked.In the end, the problem posed by “socialist economics” is simply one of making sure use values are on the shelves for the producers.

In this sense, the experience of the Soviet Union and preceding “socialist” countries provides little or no guide. In first place this is true, because the Soviet Union aimed at production of surplus value, not the needs of the producers. The Soviet Union had an “economy” precisely because production was carried on for aims other than the needs of the producers. As a result, labor itself was divided into the needs of the producers (wages) and the need of the state (surplus). Marxists try to argue this was a necessary division because of the hostility of the west or the immature stage of socialism, but, of course, this is complete bullshit. The real problem in the Soviet Union was that no matter the development of the productive forces, the state demanded still more labor. The Soviet Union went head first into the earth in a blinding orange fireball, as the CPSU struggled to increase labor still more; it never swerved from its aim of maximum extraction of surplus labor from the population although drowning in excess labor. The excess labor was so great in one or two years after the end of the plan, GDP fell more than 40%; the Soviet Union could have easily reduced labor by this amount and more.

Every “socialist” with a plan for a socialist “economy” of the future risks simply following in the footsteps of the Soviet Union. Simply put, they have their own ideas on how to dispose of the labor of the working class and want to impose these ideas on the class.

Second, the real problem at present, which the two writers never address, is that this is not the 1860s. The problem faced by cooperative ventures today is that society faces massive excess capital and massive overproduction of capital. Cooperatives would face the same problem Apple or GE faces: that there are few opportunities for profitable investment. If there is a distinction to be made between the 1860s and 2013, it is that capitalism was in a period of robust expansion then. Today we face the opposite problem: expansion only comes at the price of massive state intervention in the “economy”.

Some have labeled this “stagnation”, although it is nothing of the sort. The problem is likely best expressed by Keynes, who admitted capital’s economizing on the need for labor was outrunning new needs of labor. If we are trying to imagine a post-capitalist society, such a society is likely to be characterized by little or no need for labor at all.

Mendel-Gleason’s and O’Brien’s argument is based on the assumption the problem will be how to organize labor when it is actually something that is more difficult for socialists to grasp conceptually: how to live without it.