Julien,
Thanks for your response. I will respond [IN CAPITALS IN BRACKETS] in order
to distinguish my response from your orginal commentary:
> >Soviet-style socialism has been shown unworkable
>
> What do you mean by "unworkable"? It worked quite a while, isn't it?
[I HAVE TWO RESPONSES TO THIS:
1) IF WE GRANT FOR THE SAKE OF ARGUMENT THAT IT DID WORK "QUITE A WHILE,"
THE QUESTION IS STILL BEING BEGGED AS TO WHY IT DOES NOT CONTINUE TO "WORK."
VIZ., IF IT WERE TRULY WORKABLE, IT WOULD STILL BE WORKING . . .
2) IT ALL DEPENDS ON WHAT YOU MEAN BY "WORK." YES, THINGS GOT PRODUCED AND
CONSUMED, ESSENTIAL NEEDS WERE PRETTY MUCH MET (EXCEPT FOR A FEW MILLION
UKRANIANS), BUT JULIEN, HAVE YOU EVER VISITED THE EASTERN BLOC COUNTRIES
DURING THE SOVIET PERIOD? I HAVE, AND I CAN TELL YOU THAT A MAJOR PROBLEM
IN THEIR SYSTEM, FROM MY SPOILED WESTERN POINT OF VIEW, IS THAT WHILE THEIR
PRODUCTIVE ORGANIZATION WAS IN MANY RESPECTS MORE WORKER-FRIENDLY, IT WAS
NEVER VERY CONSUMER-FRIENDLY. INDEED, I WOULD CHARACTERIZE IT AS
CONSUMER-UNFRIENDLY. IMO, THIS IS NOT UNRELATED TO THE COLLAPSE OF THIS
SYSTEM. WORKERS ARE ALSO CONSUMERS. HERE IN THE WEST, WORKERS ARE
BRAINWASHED BY THE MEDIA TO SEE ONLY THEIR CONSUMING SELVES AS IMPORTANT,
BUT IN THE USSR, ETC., THIS "SELF" WAS AS REPRESSED AS THE WORKING SIDE IS
IN THE WEST. IS THIS JUST A QUESTION OF "PICK YOUR POISON?" NO, I THINK WE
CAN DO BETTER, AND THAT IS THE WHOLE POINT OF THE "THIRD WAY" APPROACH:
BOTH THE WORKING AND CONSUMING SIDE OF THE EQUATION ARE IMPORTANT.
>
> >, yet when a viable model of
> >transcending capitalist relations such as Mondragon is presented
>
> Cooperatives are cool. There's no question. However, I don't know much
> about this case. Have they completely transcended capitalist relations
> internally? And, as to the presence of exploiters, they surely pay taxes
and
> probably pay interests on the money they needed to buy land and other
stuff.
> Besides, one can say that they are exploited when they sell at a lower
than fair
> price due to market conditions, dumping, etc.
>
[ONE OF THE ELEGANT ASPECTS OF MONDRAGON, WHICH MAKES IT ALMOST UNIQUE AND
CERTAINLY CONTRIBUTES MIGHTILY TO ITS SUCCESS, IS THE INSTITUTION CALLED THE
"CAJA LABORAL POPULAR," THE PEOPLE'S LABOR BANK, WHICH PROVIDES BANKING
SERVICES TO THE WORKERS OF MONDRAGON, AND LINES OF CREDIT TO THE
COOPERATIVES.
NO, CERTAINLY ONE CANNOT COMPLETELY TRANSCEND THE SEA OF BOURGEOIS VALUES IN
AN ISLAND OF SOCIAL PRODUCTION, BUT YES, ONE CAN ELIMINATE THE PROFITEER
ENTIRELY, AND THIS HAS BEEN ACCOMPLISHED!
I DO NOT HAVE ENOUGH INFORMATION TO ANSWER YOUR SUGGESTION ABOUT "DUMPING"
ETC. I WOULD BE VERY SURPRISED IF THEY ENGAGED IN SUCH BEHAVIORS. YES, OF
COURSE THEY ARE COMPETING WITH CAPITALIST FIRMS FOR MARKET SHARE, BUT THEY
HAVE NO PROFIT-IMPERATIVE TO MAINTAIN, AND CAN BE MUCH MORE FLEXIBLE IN
THEIR APPROACH. FOR EXAMPLE, THEY WILL ACCEPT A LOWER "PROFIT" MARGIN IN
ORDER TO MAINTAIN EMPLOYMENT.
I DON'T WISH TO MAKE MONDRAGON SOUND LIKE AN IDEAL. IT HAS PROBLEMS,
INCLUDING THE RECENT ADDITION OF MANY WORKERS TO THEIR CORPORATION WHO ARE
NOT COOPERATORS, AND RELATIVE TO WHOM THE CORPORATION IN THOSE AREAS ACTS AS
CAPITALIST (THESE WORKERS WERE NOT DENIED COOPERATOR STATUS, THEY JUST
DECLINED IT -- THESE WERE FIRMS ACQUIRED FROM CAPITALISTS BY THE MONDRAGON
COOPERATIVE CORPORATION). BUT THE POINT IS, IT WORKS, IT CONTINUES TO WORK,
AND THE MODEL APPEARS TO BE UNIVERSALLY APPLICABLE.]
> >a practical program that will enaable
> >us to overcome the flaws of capitalism in a way that suffers no loss of
> >efficiency such as that attained by the market principle of determining
> >demand.
>
> I think that this efficiency of the market remains to be seen. I guess it
depends
> on what kind of efficiency (efficency of what?) you wants. Could you
expand on
> what you mean by "determining demand"? Markets do equilibrate supply and
> demand by excluding the poorest and/or less eager demanders. In a free
> market functioning as in theory, it is generally demand which adapts to
supply
> short-term and not the reverse. Anyway, it's clear that markets are very
bad at
> some things and rather good at others. One thing they are good at IMO is
> distributing production and dynamically signaling the most demanded things
> through price. However, if there's inequality it means that the poorest
won't be
> able to get the most demanded things. A partial solution that is already
> applied now in many countries is restricting the markets in the essential
> products like some foodstuffs. A more comprehensive and complementry
> solution would be a direct attack on inequality.
[THERE, NOW YOU'RE TALKING! YOU SEEM TO HAVE CONFLATED TWO SEPARATE
QUESTIONS HERE: WHETHER THE MARKET CAN EFFICIENTLY EQUILIBRATE SUPPLY AND
DEMAND AND WHETHER ALL THE ACTORS IN THE MARKET ARE ENABLED TO GIVE EQUAL
EXPRESSION TO DEMAND. I WOULD ANSWER THE FORMER WITH AN UNEQUIVOCAL "YES,"
AND IT SEEMS THAT YOU ACKNOWLEDGE IT AS WELL. HOWEVER, WE BOTH RECOGNIZE
THAT UNDER CAPITALISM, MANY WHO PRODUCE HAVE VERY LIMITED PURCHASING POWER,
WHILE MANY WHO DO NO WORK AT ALL ARE IN THE POSITION TO SKEW THE DEMAND
CURVE WITH THEIR OBSCENE PURCHASING POWER. BUT UNDER A COOPERATIVE SYSTEM,
WHERE WOULD THOSE FOLKS DERIVE THEIR INCOMES? YOU BRING UP A GOOD POINT
ABOUT SPECULATIVE ACTIVITY, BUT IF ONLY WORKERS OWNED, AND ALL OWNERS
WORKED, WHAT WOULD THERE BE TO SPECULATE ABOUT? YES, I SUPPOSE THERE IS
TILL ARBITRAGE, BUT THAT IS WHY I HAVE ALWAYS CONSIDERED THE IDEA OF A
COMMON CURRENCY A PROGRESSIVE ONE. MOROEVER, THIS RECENT IDEA OF TAXING
SPECULATION (ARBITRAGE) STRIKES ME AS ALSO A PROGRESSIVE IDEA.]
Markets also obviously fails
> where there's not much elasticity in demand and supply.
[CAN YOU ELABORATE THIS POINT PLEASE?]
There's another
> problem: speculation. It's especially severe in the case of the things
that don't
> deteriorate quickly like real estate. Anti-speculative laws have existed
in
> some critical situations but I think that the only good answer is weaking
> property rights and creating a counter-speculative institution who does
> something like the Fed does with the dollar rates (trying to stabilize the
rates
> by buying low and selling high).
[AGAIN, JULIEN, YOU MAKE A GOOD POINT HERE, BUT THE COOPERATIVIZATION OF
INDUSTRY WOULD GO A LONG WAY TOWARDS LEVELING INCOMES, AND THIS WOULD IN
ITSELF MINIMIZE THE PROSPECT OF SPECULATION, SINCE THIS TENDS TO REQUIRE
CONSIDERABLE RESERVES. YET YOUR POINT IS TAKEN: SO LONG AS MARKETS EXIST,
SOME POSSIBLITY OF SPECULATION WILL PROBABLY ALWAYS ACCOMPANY IT.
BUT THIS IS AN "EVIL" WITH WHICH IT WOULD BE POSSIBLE TO CONTEND. WHAT WE
CANNOT CONTEND WITH, AND WHAT IS AT THE BASE OF OUR MYRIAD SOCIAL PROBLEMS
AND THE ECO-CRASH WHICH IS THE MAIN POINT OF THIS LIST, IS THE LABOR MARKET.
THAT IS THE MARKET THAT WE MUST READ OUT OF THE EQUATION FOR GOOD. CAPITAL
MUST BE MADE TO SERVE THEWORKER WHO USES IT, AND NOT VICE VERSA. THE OTHER
POTENTIAL PROBLEMS WILL PALE BY COMPARISON. BY THUS ELIMINATING THE IDLE
CAPITALIST FROM THE EQUATION, AND THE IRRATIONAL PROFIT MOTIVE, WE MAKE EASY
ROOM FOR BOTH THE CONSUMER AND THE ENVIRONMENTALIST TO JOIN THE WORKER IN
DETERMINING THE ESSENTIAL QUESTIONS OF ECONOMICS, SINCE BOTH OF THESE ARE
SIMPLY THE WORKER IN HIS OTHER HUMAN CAPACITIES: WHO SHALL PRODUCE HOW MUCH
OF WHAT FOR WHOM?]
PEACE,
KEN
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