Economic democracy: building the future, a better world for all

If you've read previous posts on this blog, you'll know that I've been blogging about how we build a form of socialism that will work for the 21st century. In order for socialism to succeed, it's vital to create a viable economic alternative to capitalism. I've also looked at how a socialist government could drive lasting change in our society. Here I want to further explore two key requirements for building socialism. They are: 

1. capitalism cannot be replaced politically, it must be overcome economically 

2. socialism must empower individuals and social groups to take control of their own lives and communities. The key to this control is economic control. 

Real power is economic power. If socialists want to transform society, they must gain economic power. Simply winning political power in elections is not enough. Historically, socialist and social democratic governments have been able to use the power of the state to ameliorate the excesses of capitalism without ever shaking its grip on society. 

Real power has always remained with those who own the means of production. The traditional socialist answer to this has been to put the means of production in the hands of the state, thus ending the power of capitalists to dominate society. 

This didn't work in the Soviet Union - why? Because it didn't fulfil the requirement in 2. above. People weren't empowered economically. They swapped a capitalist employer for a state employer without ever gaining real economic control over their own lives. They lacked the incentive and power to create real wealth for themselves and the communities they lived in. To gain economic power, socialists need to start creating wealth, and by wealth I don't just mean money - I mean strong, vibrant, healthy communities without poverty of any kind. Workers create all the world's wealth. Marx's development of the idea of surplus value in Das Kapital enabled socialists to understand how capitalists expropriate that wealth for themselves, leaving the crumbs from the cake of wealth creation for the rest of us. 

To gain economic power, socialists must enable workers to create wealth and keep it for themselves, and their communities. How can workers do this without becoming capitalists? The answer is mutualism. There is nothing new about this. Robert Owen advocated this 150 years ago. In the UK there are 7000 successful co-operatives with a turnover of £40 billion. 

This may be small beer compared to the whole economy, but it has the potential to grow. Co-operatives are socialism in action. They are democratically controlled enterprises in which the workers own the means of production. They create wealth for workers and communities instead of for capitalists. Co-operatives tend to have a greater success rate when started up than capitalist companies. Some socialists feel uncomfortable with the notion of making profits and commercialism of any kind, but these organisations can be not-for-profit if they choose. What is key is how the profits are used.

Profits made can be used to make co-operatives grow and benefit communities. Commercialism does not have to be of the rapacious, dehumanising capitalist variety. One of the historical weaknesses of socialism is that it has failed to meet the aspiration of people to improve their material condition. Co-operatives allow workers to do just that without the need for capitalism. Co-operatives are social enterprises. They can be not-for-profit or explicitly for community benefit. The key is that workers have control over their own economic destiny, and are able to improve their own and their community's well-being. 

The beauty of this is that we can do it now. There is no need to wait for a general election or a socialist government. If you want to help to bring about socialism, go out and start up a co-op. Demonstrate that we can create wealth democratically and equitably without the need for capitalism. Co-operatives completely undermine many of the arguments of the right - that socialism doesn't reward individuals or encourage enterprise, and can't create wealth.

Essential reading for anyone who wants to know about economic Democracy and what is happening now.

Of course, cooperatives aren't just about businesses they are about housing, which should and could be controlled by the people who live in them - not grifting landlords. And of course it goes further than this. Communities should have control of public spaces, community centres, allotments, energy, water, schools and public transport. 

Every successful co-op diminishes capitalism. I'm not suggesting that we don't need socialist parties, or trade unions, or that we shouldn't be trying to create a socialist state. But doing those two things without creating a viable, productive, inclusive economic alternative to capitalism won't bring about a socialist society. Maybe we should be talking about a communitarian society? Oh, and it's crucial that Your Party adopts this approach and builds economic democracy.