David Schweickart

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

I T I S S T A R T L I N G T O realize that the concept of economic exploitation, which has been the focus of intense philosophical debate for what seems like decades now, was barely touched on in John Rawls's 1971 masterwork, A Theory o f Justice, the book that ushered in the present era of Anglo - American social and political philosophy. The subject was broached just once by Rawls, and only to be dismissed as being of such secondary importance as to be "out of place here."1 The concept, however, had begun to attract the attention of a generation of students and young faculty who were rediscovering Marx, to the point that it could not much longer be ignored, not even in Harvard Yard. Robert Nozick, in his famous juniorcolleague, neoconservative rebuttal to the liberal Rawls, devoted a full nine pages to attacking "Marxian exploitation," concluding that "Marxian exploitation is the exploitation of people's lack of understanding of economics.".

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.

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.

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.

Abstract David Ramsay Steele's From Marx to Mises argues correctly that the standard account of the economic calculation debate is a misrepresentation. Mises and Hayek were not bested by Lange and Taylor. However, it is not true, as Steele claims, that socialists have yet to face the Misesian challenge, nor that the debate over socialist calculation sheds much light on the recent collapse of communism. Steele's critiques of market socialism and worker self?management and his treatment of Marx are, moreover, deficient, as a consequence of his ?Libertarian Panglossism.? Tout est an mieux . . . dans ce meilleur des mondes possibles.

Professor Arnold's reply to my reply seems not to have touched the substance of my argument. Perhaps I have been unclear. Arnold contends that any form of market socialism, if unchecked by central authorities, would revert to a system essentially undistinguishable from capitalism. Against this contention I have argued that a democratic, worker-controlled, market socialism that generates its investment fund by taxation exhibits no such tendency. Specifically, I argued that in such a society 1. there exists no tendency for socialized property to revert to private property ; 2. the ability of private individuals to accumulate vast wealth is sharply curtailed ; 3. the authority structures within enterprises are much more democratic than under capitalism; 4. intra-firm income differentials will be far more egalitarian than under capitalism

This paper argues that Marx’s critique of capitalism is not, as commonly believed, a critique of the “free market.” I argue that the “market” under capitalism should be understood as a three-fold market—for goods and services, for labor and for capital. I argue that Marx’s critique is essentially a critique of the latter two markets, and not the first. Hence theoretical space opens up for “market socialism.” I proceed to elaborate briefly what specific institutions might comprise an economically viable socialism that would not be vulnerable to Marx’s critique.

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.

This book is a completely rewritten version of the author's earlier Capitalism or Worker Control?. Its central thesis is that, despite the collapse of communism in Eastern Europe and the break-up of the Soviet Union, capitalism cannot be justified on either economic or ethical grounds. There is in fact an alternative to capitalism that promises greater efficiency, and equality, and more rational growth, democracy and meaningful work. This alternative, Economic Democracy, is market socialism with decentralised investment planning and workplace democracy. Professor Schweickart compares this model with other models – laissez-faire conservatism, the Keynesian welfare state, and 'neo-liberalism' – and argues that it is really superior on every count. He also sketches out a possible transition from advanced capitalism, from what is left of the centrally planned economies, and from Third World underdevelopment, to Economic Democracy. The author concludes with some reflections on Marx's communism, as historical materialism, and on the future of Marxism.