Reimagining Political Economy

March 25, 2022

Over the last couple of months I’ve discussed the way that contemporary industrial societies struggle under the weight of a disastrous failure of imagination. That’s among the most potent and disturbing political facts of our time.  Even though the existing order of society has proven to be a miserable failure in terms of every human value, and is cracking apart around us as we watch, an astonishing number of people have lost the ability to imagine any alternative to it that doesn’t duplicate all its worst features.

Now of course there are reasons for this. I’m thinking here, to begin with, of a thoughtful recent essay by Eve Ettinger challenging the current popular notion of “burnout.” Ettinger spent twenty years in an abusive religious environment and, like many survivors of experiences of that kind, came out of it with complex post-traumatic stress disorder (C-PTSD). Her essay notes that many of the people she knows who complain of “burnout” as a result of their work experiences are describing symptoms that she’s lived with for years.

All things considered, it’s not surprising that working in a modern corporate environment would have roughly the same impact on the body and mind as belonging to a dysfunctional religious cult. There’s the same entrenched culture of abuse and exploitation, not to mention the same pervasive gaslighting—the constant insistence on the part of the people who have power over you that the abuse and exploitation you experience aren’t real, that everyone belongs to one happy team, and if you don’t like what’s being done to you, it’s your fault and you need to improve your attitude. It makes all the sense in the world that the inmates of any such system would end up with serious mental and physical health consequences as a result.

All that deserves attention in its own right, but I want to focus here on one of the many aspects of chronic PTSD.  Ettinger sums up that aspect memorably:

“[M]y friends and colleagues started expressing a relationship to time and the future that alarmed me. They began talking about the future as if it didn’t exist, as if their imaginative powers were gone. There was no future; there was only this moment, this week, this day, and getting through it. We could be stuck here forever was the vibe at large. This shift was alarming, because up until that point, I was the only person I knew who consistently related to time that way —thanks to complex PTSD.”

We need to consider the possibility, in other words, that a great many people in today’s industrial world have taken so much psychological damage from the constant maltreatment meted out to them by modern corporate culture that all they can do is keep stumbling blindly ahead from day to day. That would certainly go a long way to explain the way that our societies have been doing the same thing on a collective level, lurching forward mindlessly toward one preventable disaster after another:  it’s because too few people have the mental resources left to do anything else.

Fortunately the situation isn’t as hopeless as that last comment might make it sound. One of the things that makes me think so is the extraordinary rate at which people here in the United States are bailing out of their jobs, sometimes to get a better job elsewhere, sometimes to find some way to make a living outside the prison walls of nine-to-five employment. People whose imaginations have been wholly crushed don’t do that.  Thus I think it’s worth suggesting that there’s room for a rebirth of imagination in contemporary industrial societies—and one of the themes that it might focus on first and foremost is the sphere of political economy.

I insist on those latter two words, by the way. One of the reasons that economics has become such a reliable source of bad advice over the last century or so is that it neglects half its original subject matter. The science that Adam Smith founded, and that so many other thinkers pursued in his wake, was properly called political economy, because it dealt with the relationship between wealth and power. That turned out to be too explosive a mix for the comfort of the privileged, and so in the early twentieth century political economy was chopped in half. The bleeding fragments got turned into the half-sciences of economics and political science, which have spouted twin plumes of comforting nonsense ever since.

The system of political economy in most of the industrial world these days is neoliberal corporate capitalism.  Each of those words has a specific meaning.  It’s capitalism because the means of production and distribution are owned by people who have large amounts of financial capital; it’s corporate because the corporation—an imaginary legal person with more rights and fewer responsibilities than the rest of us—is the structural mechanism by which capitalists exert their ownership; and it’s neoliberal because it demands, and usually gets, legal arrangements that place the rights and profits of corporations ahead of the rights and interests of nations and the people who live in them.

It’s not a very good system, unless you happen to belong to the 5% or so of the population of industrial nations who profit mightily from it, or the 15% or so who receive more benefits than costs from their participation in it. Since the late 1970s, however, the corporate media across the industrial world has loved to insist that neoliberal corporate capitalism is the only possible system nowadays—that, in the words Margaret Thatcher made infamous, “there is no alternative.” Francis Fukuyama’s 1989 essay “An End To History?” gave that claim a veneer of philosophical respectability, borrowing Hegel’s logic to claim that history consists of the struggle between competing systems of political economy, neoliberal corporate capitalism won, and therefore history is over and we have no choice but to put up with the current status quo forever.

Hegel’s name is worth noting here, though not for the reasons Fukuyama had in mind. It’s a curious fact of the history of ideas that all the most dysfunctional ideologies of modern times have Hegel’s stamp on them. Fascism is a good example:  Giovanni Gentile, who was Benito Mussolini’s pet philosopher and lent his considerable talents to the sorry task of giving Italian Fascism the same sort of pretensions Fukuyama gave to the regime of George Bush the elder, was a Hegelian philosopher. Then there’s the biggest name of all, the man who turned Hegel’s airy abstractions into an ideology that racked up well over 100 million political killings during the twentieth century. Yes, that would be Karl Marx, the inventor of modern socialism.

The ownership, however, is a very abstract thing. Individual members of the working class don’t get to exercise their ownership in any way that matters. Rather, the means of production always end up controlled by a government  bureaucracy over which the workers, individually or collectively, have no control or even influence. (Remember that socialists inevitably reject democracy, with its inconvenient checks and balances, as hopelessly bourgeois.)  That’s why socialism soon comes to resemble nothing so much as corporate capitalism, not least in its treatment of workers. “We pretend to work,” ran the joke in the Soviet Union, “and they pretend to pay us”—a wry comment that could be made just as accurately of the corporate sweatshops of modern capitalist America.  Thus socialism is not an alternative to capitalism in any way that matters. It might be best described, in fact, as capitalism without shareholders.For more than a century now it’s been a standard rhetorical device for socialists to insist that their belief system is the only alternative to capitalism. It’s understandable that they should insist on this, since at this point—with Stalin, Mao, and Pol Pot to look back on—it’s hard to think of any reason why anyone would embrace socialism if they thought they had any other choice at all. There’s a fine irony in the way that the promoters of capitalism and socialism both insist that the only alternative to one of these is the other. Yet there’s a deeper parallel between the two systems that explains this comfortable partnership readily enough. Socialism, according to its own definition, is a system of political economy in which the means of production are owned by the working class. (The means of distribution, which are at least as important, don’t get as much discussion in socialist literature.)

(Yes, I’m well aware that there are many different sub-sub-subspecies of socialism; there have been since Charles Fourier invented socialism in 1810 or so, but when they get into power, they all turn promptly into bureaucratic state socialism. I’m also well aware that socialists love to insist that the Soviet Union, Communist China, and Kampuchea weren’t real socialism, and that if we hand over absolute power to them again, they promise, cross their hearts, that it really, truly won’t turn out the same way. Somehow the old routine in the Peanuts comic strip with Lucy and the football comes to mind….)

The point that’s missed here is that there are in fact viable alternatives to the Tweedledum and Tweedledee of capitalism vs. socialism. All through the nineteenth century and the first half of the twentieth, people who recognized the failings of the existing order of things explored other options and put those options into practice in various ways, and socialism—in any of its forms—was only one of the systems of political economy that came out of the resulting intellectual ferment. I’m going to talk about three of the other options here.

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Cooperativism. This is the 800-pound gorilla of alternative economic schemes, that one that has been put to work successfully over much of the world already with very good results. As the name suggests, this is a system in which cooperatives—voluntary associations of individuals—own and control the means of production and distribution. There are two broad categories of cooperatives in a fully developed cooperativist system, worker cooperatives and consumer cooperatives, and they deserve separate discussion.

Worker cooperatives are already found all through the world’s industrial nations. In a worker cooperative, the employees own the business, and elect a board of directors that hires and fires the people who fill corner-office roles. There are various ways to run a worker cooperative, each with its own strong and weak points.  If you look into the very extensive print and online literature on cooperative organization you can find ample information on the options, and many countries have associations of cooperatives that are eager to help new co-ops get started.

Consumer cooperatives are not quite so common as they used to be, but you can still find them, and you can also start them. The simplest form of consumer cooperative is a buyers club, in which a group of people get together to buy groceries and other products wholesale and split the cost, cutting out as many middlemen as possible. Once a consumer co-op gets going, if its members want it to expand, they can add members and raise the money to open a cheap storefront somewhere, though of course this involves additional costs. Alternatively, it can stay a buyers club and thrive indefinitely.

At its upper end, cooperativism turns into syndicalism—a roadmap for a new society in which workers and consumers organize until they become the dominant political force, and take over. There are various flavors of syndicalism, ranging from democratic syndicalism to anarcho-syndicalism, and various theories about how best to manage the various stages of the syndicalist project; again, you can find plenty of reading material on the subject if you want to. Start with Ursula K. Le Guin’s brilliant novel The Dispossessed, which is set in a syndicalist society and offers a remarkably clear discussion of the strengths and weaknesses of the movement.

Other resources? Here’s a good introductory articlehere’s the website for the International Cooperative Alliance, and here’s an old but still useful book on the subject. If you can find a copy of The Food Conspiracy Cookbook—it’s out of print but still in copyright—it’s a fine guide to organizing a buyers club.

Distributism. This is more an attitude than a specific program, though some very thoughtful work has been done on it over the years, especially in Roman Catholic circles. The basic theme of distributism is that Marx was right in recognizing the serious problems caused by putting ownership of the means of production in the hands of a tiny minority of rich people, but wrong in thinking that transferring notional ownership of the means of production to “the working class” as an abstract whole would improve matters at all. The distributist idea is that the best way to get the means of production into the hands of the working class is to distribute the means of production so that each worker owns the means he or she uses to produce goods and services.

In its late nineteenth and early twentieth century forms, as worked out by writers such as Hillaire Belloc and G.K. Chesterton, distributism had a distinctly retro focus: the goal was to return the agricultural sector to family farms and to replace the factories with individual producers, perhaps organized in local or regional guilds as they were in the Middle Ages. These days, by contrast, you can also find what could be called technodistributism, which argues that modern technology makes factories an anachronism and proposes a radical decentralization of work empowered by the latest technological gimmickry. No, it’s not my cup of tea, but it may be yours.

The most thoroughly worked out system of distributist thought so far is the work of E.F. Schumacher, the dissident economist whose book Small is Beautiful has been discussed at length in some of my past series of blog posts and was a central inspiration to my book The Wealth of Nature. Schumacher argued that modern economics is such a steaming mess because it ignores every bit of evidence that fails to support the “greed is good” school of mindless excess. He warned of the impending energy crisis long before it arrived.  (It probably helped that for many years he was the chief economist of the British Coal Board.) He also wrote extensively on one of the most important and least discussed sources of inequality between classes and nations, the cost of establishing and equipping a workplace, which is kept artificially high to prevent more people from entering business and driving down profits for the big boys.

Other resources:  This encyclicalthis essaythis essay, and this book will get you started. You’ll have to buy Small Is Beautiful, since it’s still in copyright, but it’s well worth your while.

Social Credit. Imagine for a moment that a century ago there was an alternative system of political economy supported by public figures ranging from Dorothy Day on the left to J.R.R. Tolkien on the right, not to mention Robert Heinlein (and Robert Anton Wilson later on) off on their non-Euclidean vector.  It offered a straightforward response to some of the most obvious economic problems of our time, but it was erased from our collective memory so completely that next to nobody even remembers its name. Sounds improbable?  Welcome to the world of social credit.

Social credit was founded by a British economist and engineer, Major C.H. Douglas, who focused on the role of debt and credit in generating the wildly unbalanced distribution of wealth in capitalist societies. He noted, and proved by extensive studies, that the vast majority of businesses pay out less in wages, salaries, and dividends than the value of the goods and services they produce; as a result, it’s mathematically impossible for consumers to buy everything the economy produces without running up unpayable debt—and that’s where you get economic crises. There’s a great deal of theory, but a very rough sketch of the practical consequences is that under social credit, banking is a public utility rather than a for-profit industry.  Money is recognized as a system of tokens rather than a commodity, and is issued directly by the government rather than by issuing bonds. (Do we really want to have the government paying rich people for the privilege of issuing its own currency?  That’s what today’s system of money creation via debt amounts to.)

Finally, a national dividend is paid out annually to each citizen to balance out the imbalances in purchasing power, so that consumers can afford to consume everything that producers produce. These and other factors in a social credit system prevent the absurd accumulations of wealth in the hands of the wealthy few that make capitalism so destructive, without allowing the absurd accumulations of power in the hands of the politically connected few that do exactly the same favor for socialism. Thus a social credit society permits free enterprise in every field except finance, and is wholly compatible with democratic systems of governance.

Resources? This website and this website will get you started; Douglas’s books Social Credit and Credit-Power and Democracy will take you deeper. If you’re a Heinlein fan, you might also try his novel For Us, The Living, which is set in a future United States run according to social credit principles.  The second volume of Robert Anton Wilson’s Schroedinger’s Cat trilogy also has a modified form of social credit as a central theme.

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Are there other options? You bet. My point in describing these is not to claim that the three systems of political economy I’ve outlined are the only games in town. It’s to point out that neoliberal corporate capitalism and bureaucratic state socialism aren’t the only games in town, and that it’s possible to rethink political economy in other ways. I also chose these to show that retrovation—the deliberate use of the past as a resource for the future—is a live option right now. We don’t have to reinvent the wheel from scratch; we can draw on the experiences of wheelwrights of the past to get past those initial mistakes and let our imaginations stretch further than they otherwise would.

Imagination is the crucial factor here.  One of the reasons neoliberal corporate capitalism and bureaucratic state socialism are both so toxic is that they can tolerate no alternatives. In a healthy system of political economy, by contrast, there’s always room for people to experiment with radically different approaches to the ownership of the means of production and distribution, and for nations to explore different policies in the hope of finding the mix that works best under local conditions. When the radicals of past decades insisted “another world is possible,” they were right, but they didn’t go anything like far enough. Many other worlds are possible, and it’s also possible—to borrow a line from certain more recent radical thinkers—to envision a world in which many other worlds will fit.  To my mind, that’s a useful goal to work toward—more useful, certainly, than a mental monoculture fixated on any one system of political economy.

John Michael Greer

John Michael Greer is a widely read author and blogger whose work focuses on the overlaps between ecology, spirituality, and the future of industrial society. He served twelve years as Grand Archdruid of the Ancient Order of Druids in America, and currently heads the Druidical Order of the Golden Dawn.

Tags: cooperativism, distributism, political economy, social credit