Defining “Alternative Systems”

 

The topic “alternative economic systems” is generally construed as “economic alternatives to capitalism.” This presumes we agree on what “capitalism” is. I don’t think we do.

Many neoclassical economists won’t even use the word “capitalism” referring instead to a “market society” or sometimes a “modern” society.

I think this a serious mistake. We need words to describe the institutional arrangements in which markets are situated, because these institutional arrangements shape market outcomes.

On the other hand, many economists on the left use the word “capitalism” as an all-encompassing label for our global economic system. Capitalism is everything and everywhere.

When capitalism is defined in these terms there is no escape from it. This definition elides the significance of economic differences based on gender, race/ethnicity, and citizenship, treating them purely as aspects of “identity” rather than as social relations of production.

I side with a critique launched more than ten years ago by the radical hybrid geographer JK Gibson-Graham in The End of Capitalism As We Knew It. By defining capitalism as hegemonic we make it so. We give it power over our lives and our ideas. We constrict the space available for articulation of alternatives.

Feminist theories of intersectionality suggest that we should describe the world in terms of hybrid, overlapping structures of inequality. This description helps explain both the stability of hierarchical structures and their points of vulnerability. Hence its relevance to discussions of “alternatives.”

In developing this general point further I want to explain 1) why feminist theory urges a more complex description of the U.S. economy than “capitalist” 2) the implications of this description for how we think about “social democracy” and its relationship to socialism 3) what this means for practical political engagement today.

The legacy of Marxian political economy urges us to define the economy in terms of the corporate for-profit sector. Even well-known efforts to articulate a vision of market socialism, a radical departure from centralized democratic planning, focus primarily on the for-profit sector.

But the U.S. economy, to take one example, is way bigger than the for-profit sector. It includes a large public sector (whose size is underestimated relative to the private sector because of several arbitrary accounting rules). Much of the spending in this public sector is devoted to the care, protection, and development of human capabilities in health, education, and social services.

Our economic system also includes a substantial number of non-profit organizations and many for-profit firms explicitly committed to larger social goals, including worker-owned and managed businesses.

Our economic system also relies heavily on the unpaid labor of people devoted to meeting their own needs and those of their families, friends, and neighbors. Such commitments account for about half of all the time devoted to work in the U.S. today, according to the American Time Use Survey. (For more details, see this previous post).

In sum, a significant share of the work performed in the U.S. today is not governed directly or indirectly by principles of profit maximization.

We already inhabit a world that includes significant alternatives to capitalist forms of organizing work, and it would be helpful to spend more time figuring out why.

Surely part of the reason is that the demands of care for other human beings——along with the hugely significant implications of teamwork, externalities and public goods–make a completely capitalist system infeasible.

Applying a phrase lifted from the lexicon of historical materialism, I attribute this variation and complexity in productive arrangements to the technical forces and social relations of production.

This leads to very different conclusions than the traditional Marxian assumption that public provision of health, education and social services represents an element of consumption–a hard-fought element of the social wage fought for by the working class, or an epiphenomenon of the Keynesian welfare state.

Many different dimensions of inequality are contested in these arenas of social reproduction. Political struggles for a higher minimum wage, single-payer health insurance, improved public school finance, free higher education, paid family leave, early childhood education, old age security, “black lives matter” and immigrant rights are not merely social issues. They also represent efforts to develop alternative forms of economic organization.

Social democracy is not about “class compromise” or gutless reformism. It is about socializing the costs and risks of developing human capabilities in ways that enhance economic opportunity and fairness. This is exactly why political struggles over the extent and funding of such programs cannot be boiled down to class interests. They are infused with conflicts based on citizenship, race/ethnicity, gender, and age, among others.

Still, class conflict plays a central role. In an increasingly de-nationalized global economy with a labor surplus, capital finds it increasingly easy to avoid paying the costs of developing human capabilities. Profit-shifting and international tax havens are only the most obvious examples.

National capitalist economies will not be able to find a solution to this problem until they reduce the weight of plutocratic influence through (among other things) campaign finance reform and significant redistribution of income and wealth.

Bottom line: the political efforts I have described above are sometimes interpreted as “reformist” because they don’t challenge the all-in-capital-letters LOGIC OF CAPITALISM.

But they are the necessary steps in the development of a sustainable, equitable, and efficient economic system, not a diversion from it.

I think that many Americans share this view. I think they define socialism largely in terms of social responsibility for the egalitarian development and maintenance of human capabilities.

This is especially true of the younger generation. A Pew Foundation poll in December 2011 reported that 49% of 18 to 29 year-olds in the U.S. held a favorable view of socialism compared to 46% with a favorable view of capitalism.

The poll didn’t offer a definition of socialism, but support for it didn’t break cleanly along class lines. Only 24% of whites overall held a favorable view of socialism, versus about 55% of African Americans and 44% of Hispanics. Among all ethnic groups, Hispanics had the least favorable view of capitalism.

These results suggest that socialism now has a much broader meaning than it once did. They also suggest that some important economic alternatives are within our reach. Let’s fight for them.

 

P.S. I say more about what I call “care socialism” in an interview in In These Times
from 2011, but am obviously still working on what it means—and would especially appreciate any comments or criticisms.

 

 

This post is based on my presentation at the panel discussion “Envisioning Alternative Economic Systems” co-sponsored by the Union for Radical Political Economics and the International Association for Feminist Economics at the meetings of the Allied Social Science Association in San Francisco, CA, January 5, 2016.

 

Posted January 15, 2016.