David Schweickart

Since first published in 2002, After Capitalism has offered students and political activists alike a coherent vision of a viable and desirable alternative to capitalism. David Schweickart calls this system Economic Democracy, a successor-system to capitalism which preserves the efficiency strengths of a market economy while extending democracy to the workplace and to the structures of investment finance. In the second edition, Schweickart recognizes that increased globalization of companies has created greater than ever interdependent economies and the debate about the desirability of entrepreneurship is escalating. The new edition includes a new preface, completely updated data, reorganized chapters, and new sections on the economic instability of capitalism, the current economic crisis, and China. Drawing on both theoretical and empirical research, Schweickart shows how and why this model is efficient, dynamic, and applicable in the world today.

Democratic Socialism -- The relationship between democracy and socialism is a curious one. Both traditions are rooted philosophically in the concept of equality, but different aspects of equality are emphasized. Democracy appeals to political equality, the right of all individuals to participate in setting the rules to which all will be subject. Socialism emphasizes material equality--not strict equality, but an end to the vast disparities of income and wealth traceable to the inequalities of ownership of means of production.

My interest in China was rekindled several years ago by an invitation to a conference, "Modernization, Globalization and China's Path to Economic Development," to he held in Hangzhou, July, 2002. The conference was organized by Cao Tian Yu, a philosopher of science at Boston University and his wife Lin Chun of the London School of Economics--both deeply concerned about the future of China. It was attended by a number of Western Leftists (Samir Amin, Perry Anderson, Robin Blackburn and myself), by China specialist Joseph Fewsmith, by representatives from Singapore, Taiwan and India, by representatives from China's developing "New Left," (among them Wang Hui, whose book China's New Order was recently published by Harvard University Press1), by the president of Hangzhou College of Commerce (where the event was held) and by three retired, once prominent government officials, among them Du Runsheng, a principal architect of China's agricultural reform of the late 70s, early 80s.

What are we to make of the "Parecon" phenomenon? Michael Albert 's book made it to number thirteen on Amazon.com a few days after some on-line promotion.1 Eight of the twelve Amazon.com reviewers had given the book five stars. It has been, or is being, translated into Arabic, Bengali, Telagu, Croatian, Czech, Finnish, French, German, Greek, Italian, Japanese, Korean, Spanish, Swedish and Turkish.2 The book has been endorsed by Noam Chomsky, who says it "merits close attention, debate and action," by Arundhati Roy, who calls it "a brave argument for a much needed alternative economic vision," by Ben Bagdikian, who finds it "a compelling book for our times," and by Howard Zinn, who sees it as "a thoughtful, profound meditation on what a good society can be like."3 Yet it is a terrible book

If we look at world history over the course of the past several centuries, it is hard to miss the fact that democracy has been advancing. Not steadily. There have been fits and starts, setbacks as well as gains, but it can scarcely be denied that the world is more democratic now than it was three centuries ago, or two centuries, or one century or fifty years ago or even twenty. There is scarcely a country in the world that does not at least call itself democratic. To be sure, there is a lot of hypocrisy here, but as we know, hypocrisy is the tribute vice pays to virtue. The notion that people have the right to rule themselves is an idea of near-universal currency right now, and it shows no signs of weakening.

David Schweickart moves beyond the familiar arguments against globalizing capitalism to contribute something absolutely necessary and long overdue—a coherent vision of a viable, desirable alternative to capitalism. He names this system Economic Democracy, a successor-system to capitalism which preserves the efficiency strengths of a market economy while extending democracy to the workplace and to the structures of investment finance. Drawing on both theoretical and empirical research, Schweickart shows how and why this model is efficient, dynamic, and superior to capitalism along a range of values

The remarks that follow are not the work of a China specialist. I am a philosopher who has spent most of his scholarly life--from my days as a graduate student in the early 1970s to the present--grappling with one of the great lacunas in Marx=s work. As everyone knows, Marx thought that capitalism will eventually be replaced by a higher form of society that will resolve humanity's economic problem. He characterized this ultimate Acommunism@ in various ways: rather whimsically as a socio-economic order that allows us to hunt in the morning, fish in the afternoon, criticize after dinner, without ever becoming hunters, fishermen or a critical critics; more seriously, in accordance with the need for a compelling political slogan, as one that allows us to work according to our abilities and consume according to our needs; more philosophically, as one that reduces the realm of necessity to a minimum so as to maximize the realm of freedom. But Marx was no utopian dreamer. He knew that we would have to pass through a transitional stage to get from capitalism to this truly human society. This would be a stage marked by its origins, hence imperfect, even in theory, and yet capable of surmounting the fundamental contradictions of capitalism.

As we all know, Marx's powerful and compelling critique of capitalism provided no explicit model for a viable alternative to capitalism, no "recipes for cookshops of the future," in his disdainful phrase.1 Marx shouldn’t be faulted for this omission. He was a "scientific" socialist. Although there were sufficient data available to him to ground his critique of capitalism, there was little upon which to draw regarding alternative economic institutions. No "experiments" had been performed. We no longer have that excuse.

“Economic Democracy: A Worthy Socialism that Would Really Work” laid out a model that was to form the basis of my book Against Capitalism, published by Cambridge University Press in 1993. The article, like the book itself, was a theoretical response to the triumphalism of the TINA crowd that followed the collapse of Soviet Union and the rejection of socialism by its satellite states in Eastern Europe. “A Worthy Socialism” was intended to demonstrate rigorously that there is an alternative, at least in theory: an economically viable form of socialism that would be more democratic than capitalism and at least as efficient. Against Capitalism made the same point, but extended the argument further. Economic Democracy would be not only as efficient as capitalism and more democratic, but also more rational in its growth, more stable, more egalitarian, less prone to high unemployment, more ecologically friendly. I was sick of hearing even progressives say that “we are going to have to stop using the term ‘capitalist economy’ as if we knew what a functioning non-capitalist economy would look like.”

Capitalism causes staggering inequality, rising unemployment, growing poverty, and the degradation of democracy. But is there any viable alternative? Is there a form of socialism that would preserve the strengths of competitive capitalism, yet mitigate its worst evils? This paper argues that there is such an alternative -- economic democracy. An economic democracy keeps competitive markets for goods and services, but dispenses with labor markets and capital markets. It replaces labor markets with worker ownership, and capital markets with democratic control of investment. These mechanisms will preserve the principal advantages of capitalism, while mitigating its worst evils.

In a recent article Robert Paul Wolff has argued that Marx's theory of capitalist exploitation is incorrect, in that its ground is the premiss that labor is the source of all value.1 This, of course, is a well-rehearsed objection to Marx, but Wolff gives it a novel twist. He notes that the defense of this premise in the opening pages of Capital is inadequate, but he is not troubled by this ‘bad argument,’ for he sees Marx's real argument as something else: the claim that unless labor is the source of all value, an adequate account of profit is impossible. In other words Marx is seen to be making a transcendental argument: an inquiry into the conditions for the possibility of profit. Wolff proceeds to argue that Marx goes astray here, but not so far astray that a valid transcendental argument, faithful to Marx's essential insight, cannot be charted.