[lbo-talk] Socialist modelling (Was: Louis Proyect...)

Wojtek S wsoko52 at gmail.com
Wed Dec 28 09:27:30 PST 2011

Marv: "The reality is that the capitalist state would not permit a social economy to encroach on social ownership"

[WS:] And how exactly would it do it without encroaching on property rights?

I think your premise is based on the typical American mistrust of the state (it must be in the water here ;) and the Marxist belief equating capitalism and state. I think both are idealistic beliefs not grounded in reality. In reality, social economy exists in many countries without much state hostility and is some regions it even received state support. And the fact that the state seems overwhelmingly capital friendly nowadays is precisely because the labor is so weak. Where and when the labor was strong, the state was labor friendly. So the argument that the "capitalist" state will not permit "social economy" is really having it all backwards.

As to the Kibbutz movement - afaik it problems were sociological rather than economic. Membership was too restrictive for the younger generation who wanted greater freedom of career choice - at least according to what I read.

While we are at that - the problem with Kibbutz and similar cooperative movements is imo that they try to infuse too much cultural identity and identity politics to economics to be viable. The Kibbutz had to embody "Jewish" cultural identity, the coops had to embody anarcho-syndicalist life style and values in addition to be economically viable. That is, in my view a fatal flaw that made these movements vulnerable to capitalist competition that did not subject its employers or clients to strict cultural identity demands. In fact. capitalist firms made the point of catering to any identity the paying public wanted.

The way I see "social economy" is that aside using the same democratic principles that are accepted in modern polity it is essentially cultural identity free. It does not have to be Jewish, or hippy-dippy, or blue collar, or anarchist, or countercultural - in fact it can be plan vanilla business. To work there I do not have show that I am true believer in this or that Cause - all I need to do is to follow the company policy that gives employees certain rights and certain powers vis a vis the management, the rights that are basically the same as my rights as a citizen.

RE: "The rare companies which return to profitability are invariably reprivatized."

[WS:] It depends who owns them in the first place, no? If a business firm is owned by a holding company which in turn is cooperatively owned by, say, unions, municipalities or kindred collective entities - they cannot be just 'reprivatized' without breaking property rights, at least in the developed countries.

As to the profit maximization of the corporation - I think John Kenneth Galbraith dispelled that myth in _The New Industrial State_ and I do not have much to add to his excellent argument. The fact that an establishment must turn a profit to exist i.e. cover its operating costs and have surplus to cover capital and in our case political expenses goes without saying - but it is a nonsequitur that this inevitably leads to labor repressive policies. Contrary to neoclassical economic ideology, corporations have considerable choice in how they remain profitable, especially if they are non-stock corporations which I believe is the legal form of cooperative entities in Canada.


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