March 4, 2025
Source: Jacobin
Image by Carlos Delgado, Creative Commons 3.0
Michael McCarthy’s The Master’s Tools opens with an evocative description of life under a new social order.
“It’s a sunny Friday morning in 2045, and you’re running late for a meeting to deliberate over and agree on the priorities of the city.” You ride to the meeting on a public railway network and step off into the Public Finance District, “where the streets were converted into pedestrian zones after huge investments in transportation eliminated the need for cars.” When you arrive at the People’s Bank of Los Angeles, you join an assembly made up of your fellow workers, and together you set about deciding how to spend the city’s budget.
This vignette works because it is based on democratic innovations that already exist. McCarthy’s vision is not some unrealistic socialist utopia; it’s based on proposals — from community wealth building to participatory budgeting — that exist right now, if you know where to look.
All over the world, citizens are developing new models of local democracy to facilitate public involvement in decision-making. The democratic revival is visible everywhere from Reykjavik, where Icelanders used a participatory budgeting process to allocate more funding to tackling homelessness, to Rosario, where local Argentinians came together to resist gentrification and build a network of cooperatives that could serve the needs of their community.
But up to now, these powerful initiatives have remained localized islands of public power in a sea of oligarchic control. Why? The Master’s Tools provides one answer: if we want to democratize society, we need to democratize finance.
The Neoliberal Revolution
The familiar narrative about the rise of finance in the 1980s is that financial institutions grew so powerful they came to dominate all other areas of society. Productive investment declined as short-term, speculative investment ballooned. Governments felt unable to regulate and control financial institutions due to their immense size and influence over the economy. Financialization is presented as a neutral and inevitable process over which we, as citizens, had little control.
This narrative conceals more than it reveals. Drawing on Nicos Poulantzas, McCarthy argues that the capitalist state has to be understood as a social relation: “the political expression of active material forces — in particular, class struggles — whose power is both produced and reproduced through its formal institutions.” This perspective informs McCarthy’s, and my own, view of the neoliberal revolution of the 1980s, when finance capital became hegemonic.
Proponents of neoliberal policies argued that their political project aimed to promote human freedom, which had been compromised by the social democratic politics of the postwar period. They proposed measures to constrain the size and power of the state to create more space for economic interactions within the free market, supervised by an economized state apparatus.
As I argue in Vulture Capitalism, neoliberalism has not resulted in smaller states or freer markets, but a regime of oligarchic capitalist planning. This was no coincidence. A closer look at their proposals indicates that the neoliberals never really sought to shrink the state or free the market. They sought to shift the balance of power in society away from workers and toward capital — particularly finance capital. As McCarthy puts it, “The shift toward finance principally involved a fight from above, in which the political establishment acted on behalf of capitalism in general to break the power of the unions and workers in the US and the UK.”
The capitalist state was an active participant in the transformation of society and the economy under neoliberalism. Central banks used their power to wage class war on workers. Police forces were empowered to take on those who dared to fight back. The New Deal regulatory agenda was dismantled and replaced with a global system of rules agreed on by governments and private financial institutions. The state did not shrink under financialization; rather, its power became “intertwined . . . with that of financial institutions.”
Neither was the nonfinancial corporation “taken over” by finance. Instead, corporate governance became financialized — shareholders and executives came to focus on corporate balance sheets and share prices over all other metrics. This shift did not take place because bankers or asset managers somehow took over the boardroom; it took place because the interests of corporate executives and shareholders became much more closely aligned with those of bankers and asset managers.
The results of financialization are well known, and McCarthy charts them adeptly. Households became highly indebted, which increased the risks to workers of fighting back against exploitation. Middle-class households used this debt to accumulate assets, which made them identify with the interests of capital. The growing power of finance transformed the nature of corporate investment, leading to “underinvestment in the specific productive projects that society desperately needs.” Instead, financial institutions focused on short-term returns, aware that the governments they had captured would bail them out if things turned south.
McCarthy’s accurate and comprehensive description of the process of financialization sets up the central dilemma of the book: “Who controls investment?” The answer of course is capital and, in particular, finance capital. And the result of the finance sector’s unaccountable control over this critical economic process is not simply the growth of inequality, the increasing severity of financial crises, and the breakdown of the climate, but also the erosion of our democracy. As McCarthy says:
The twenty-first century has thus far been a century of mesmerizing surplus extraction, worker precariousness, macroeconomic instability, and climate catastrophe. . . . How have the financial institutions and actors that benefit from [these processes] . . . pulled off this self-defeating heist? The answer is their power in politics and the near-complete absence of the power of the demos in modern democracies.
Insulated From Democracy
In a capitalist society, financial decision-making is insulated from democracy, even as the decisions taken by financial institutions shape the trajectory of that society and the lives of all the economic actors who compose it. Financial institutions are responsible for making critical decisions about the allocation of credit and investment, with little public oversight, with the sole concern of augmenting their own wealth and power.
The power of financial institutions within a capitalist economy is a central component of what in Vulture Capitalism I call “capitalist planning.” Free-market theorists would respond by arguing that financial institutions do not plan per se; they simply respond to market signals. The job of a good wealth manager is to pick out the investments that are likely to generate the highest return for his clients. The market decides; financial institutions follow.
But this logic only applies in the make-believe universe inhabited by professional economists. In reality, the decisions made by financial institutions shape which investments become profitable, and which fall by the wayside. Financial institutions do not simply follow the market; they often lead it. These institutions are capable of wielding such power because they are, to some extent, insulated from competition. Yet this immense power is not constrained by any democratic accountability.
McCarthy deftly explains how the power of big finance rests on its “asset power”: that is, its power “over the productive assets at the core of a political economy’s accumulation model that they direct.” Capital’s control over productive assets, McCarthy argues, underlies all the other forms of power it is able to wield in a capitalist economy. Without this control over society’s productive capabilities, capitalists would not have the organizational, financial, and structural resources to “push and prod their way through the chess game of capitalist democracy.”
Rather than constraining the power of productive capital relative to finance capital, financialization has augmented the asset power of capital as a whole by making assets more mobile and more liquid. When capital assets are fixed and illiquid, it is harder to move them out of the country — as in capital flight — or cease investment altogether — as with capital strikes. Financial assets that are fixed in place, argues McCarthy, “always face a greater risk of being subject to democratic demands for appropriation, redistribution, and . . . democratic extension.”
The process of financialization has undermined this fixity, augmenting the asset power of capital. This relationships works in a number of different ways:
States have a far harder time taxing mobile assets, mobility makes the provision of social services more difficult, and labor and social democratic parties find it far harder to win meaningful reform when capital can be diverted outside of a political territory.
McCarthy uses the examples of Salvador Allende’s Chile and François Mitterrand’s France to show how finance capital learned early on how to use its power to discipline sovereign governments into submission.
But it’s not just that financial institutions are able to wield power over workers; it’s that they wield much of their power through workers. The privatization of pensions, a central part of the neoliberal revolution, resulted in the growth of large asset managers, responsible for the investment of other peoples’ savings without any democratic oversight. These institutions have channeled workers’ savings into industries that undermine their interests, such as the oil industry. They then use their power as shareholders to enforce corporate practices that further undermine workers’ interests by, for example, demanding cost-cutting measures such as wage cuts to boost returns.
In McCarthy’s view, the political power of finance capital is in large part “an effect of large numbers of people relying on financial assets to generate their own incomes and savings.” The very fact that we rely on financial institutions to manage our pensions and provide us with loans and bank accounts allows them to deepen and extend their power over our lives.
Democratize Finance
The concentrated power of finance means that investment is weighted toward assets that harm the interests of workers and strengthen those of capital. We live in a world of underinvestment in essential public goods such as affordable housing, public transport infrastructure, and renewable energy. At the same time, companies responsible for wrecking the climate, poisoning workers’ bodies, and corrupting our democracies find it easy to access lending and investment.
This imbalance is an inevitable result of the concentrated power of finance capital. You wouldn’t expect an authoritarian ruler to pay much attention to the interests of his citizens as long as there was no threat of revolution. In the same way, why should financial institutions pay attention to the interests of ordinary people who have no role in financial decision-making processes?
The only way out of this bind, argues McCarthy, is to democratize finance. McCarthy proposes a new vision of economic democracy, based on the ancient Athenian model. He proposes the establishment of new financial institutions governed by “minipublics” — much like the one described in the introduction — that would be charged with determining how the resources of their town, region, or nation should be invested.
The minipublics that would govern these new financial institutions would be chosen through a process of sortition, through which members are selected at random to ensure broad social representation. McCarthy writes:
These new democratized financial institutions, at every scale, should be built on a dialogic process of deliberation that not only [identifies] socially and ecologically desirable ways to allocate investment and credit but also [helps] to articular a common working-class political culture and identity, while at the same time giving a platform to the particular needs, grievances, and concerns of subsections of the demos.
He argues that choosing assemblies through sortition is the “most feasible and desirable way to bring working people into meaningful political deliberation and decision making.” He draws on examples from around the world to make his case. Ireland’s citizens’ assemblies helped to create consensus on controversial issues such as abortion and same-sex marriage. In Bogotá, Colombia, the Itinerant Citizen Assembly was set up to develop collective recommendations to the city council on issues such as urban planning. The government of Ostbelgien, Belgium, has set up a permanent citizens’ council to survey public opinion and develop policy proposals.
McCarthy argues that this model could be scaled up to create a tiered network of institutions governed by democratic bodies that would make decisions around investment. For example, a community-based public bank governed by a minipublic of local citizens might decide to invest in affordable housing, community parks and gardens, or community energy companies. At the national level, a public investment bank governed by a representative panel of citizens might decide to direct investment toward renewable energy or improving public transport infrastructure.
Taking On Capital
The vision McCarthy suggests should appeal to voters across the political spectrum. Those on the Left will appreciate his proposals to challenge the concentrated power of finance capital. Those in the center will appreciate his focus on citizens’ assemblies as a means to strengthen crumbling liberal democracies. Even some on the Right should appreciate the idea of handing power back to communities and allowing them to make decisions about their collective futures. The Master’s Tools provides a model that puts meat on the bones of the pro-Brexit slogan “Take Back Control.”
For precisely this reason, these proposals will be fiercely resisted by capital and its allies throughout the state. Financial institutions would resist any move to curtail their powers over investment. If this model was passed into law, these institutions would likely respond with capital flight or capital strike. But they would probably use their coordinated power to prevent these proposals from entering the political mainstream in the first place.
This is the main challenge McCarthy’s model faces: it requires a mass political movement to get off the ground. The democratization of finance is not something that can happen through legislative fiat. As McCarthy himself acknowledges, the capitalist state is a social relation, and legislative outcomes reflect the balance of power in society. His measures, if implemented, would go some way to shifting that balance of power. But this is precisely why they would never be enacted from the top down.
The catch-22 of democratizing finance is the same one that plagues all debates on the Left about policy change: you need power to get power. This is why it is so important for the Left to focus on building power at the grassroots. Realizing the promise of democratic innovations like community wealth building requires the democratization of finance. But the democratization of finance requires building power in communities, workplaces, and on the streets. These two visions of political change — bottom up, and top down — are not competing, but complementary.
Were the Left able to build the foundations required for the construction of this model, the rewards would be significant. The Master’s Tools promises the creation of a society based on equity, public participation in decision-making, and the redirection of investment toward solving the greatest challenges humanity faces. The book is a clarion call to rethink the foundations of our financial system and build a democracy that works for the many, not the few.
Grace Blakeley is a staff writer at Tribune (UK), and the author of Stolen: How to Save the World from Financialisation.
On Transitioning to a Participatory Economy
Image by Carlos Delgado, Creative Commons 3.0
Michael McCarthy’s The Master’s Tools opens with an evocative description of life under a new social order.
“It’s a sunny Friday morning in 2045, and you’re running late for a meeting to deliberate over and agree on the priorities of the city.” You ride to the meeting on a public railway network and step off into the Public Finance District, “where the streets were converted into pedestrian zones after huge investments in transportation eliminated the need for cars.” When you arrive at the People’s Bank of Los Angeles, you join an assembly made up of your fellow workers, and together you set about deciding how to spend the city’s budget.
This vignette works because it is based on democratic innovations that already exist. McCarthy’s vision is not some unrealistic socialist utopia; it’s based on proposals — from community wealth building to participatory budgeting — that exist right now, if you know where to look.
All over the world, citizens are developing new models of local democracy to facilitate public involvement in decision-making. The democratic revival is visible everywhere from Reykjavik, where Icelanders used a participatory budgeting process to allocate more funding to tackling homelessness, to Rosario, where local Argentinians came together to resist gentrification and build a network of cooperatives that could serve the needs of their community.
But up to now, these powerful initiatives have remained localized islands of public power in a sea of oligarchic control. Why? The Master’s Tools provides one answer: if we want to democratize society, we need to democratize finance.
The Neoliberal Revolution
The familiar narrative about the rise of finance in the 1980s is that financial institutions grew so powerful they came to dominate all other areas of society. Productive investment declined as short-term, speculative investment ballooned. Governments felt unable to regulate and control financial institutions due to their immense size and influence over the economy. Financialization is presented as a neutral and inevitable process over which we, as citizens, had little control.
This narrative conceals more than it reveals. Drawing on Nicos Poulantzas, McCarthy argues that the capitalist state has to be understood as a social relation: “the political expression of active material forces — in particular, class struggles — whose power is both produced and reproduced through its formal institutions.” This perspective informs McCarthy’s, and my own, view of the neoliberal revolution of the 1980s, when finance capital became hegemonic.
Proponents of neoliberal policies argued that their political project aimed to promote human freedom, which had been compromised by the social democratic politics of the postwar period. They proposed measures to constrain the size and power of the state to create more space for economic interactions within the free market, supervised by an economized state apparatus.
As I argue in Vulture Capitalism, neoliberalism has not resulted in smaller states or freer markets, but a regime of oligarchic capitalist planning. This was no coincidence. A closer look at their proposals indicates that the neoliberals never really sought to shrink the state or free the market. They sought to shift the balance of power in society away from workers and toward capital — particularly finance capital. As McCarthy puts it, “The shift toward finance principally involved a fight from above, in which the political establishment acted on behalf of capitalism in general to break the power of the unions and workers in the US and the UK.”
The capitalist state was an active participant in the transformation of society and the economy under neoliberalism. Central banks used their power to wage class war on workers. Police forces were empowered to take on those who dared to fight back. The New Deal regulatory agenda was dismantled and replaced with a global system of rules agreed on by governments and private financial institutions. The state did not shrink under financialization; rather, its power became “intertwined . . . with that of financial institutions.”
Neither was the nonfinancial corporation “taken over” by finance. Instead, corporate governance became financialized — shareholders and executives came to focus on corporate balance sheets and share prices over all other metrics. This shift did not take place because bankers or asset managers somehow took over the boardroom; it took place because the interests of corporate executives and shareholders became much more closely aligned with those of bankers and asset managers.
The results of financialization are well known, and McCarthy charts them adeptly. Households became highly indebted, which increased the risks to workers of fighting back against exploitation. Middle-class households used this debt to accumulate assets, which made them identify with the interests of capital. The growing power of finance transformed the nature of corporate investment, leading to “underinvestment in the specific productive projects that society desperately needs.” Instead, financial institutions focused on short-term returns, aware that the governments they had captured would bail them out if things turned south.
McCarthy’s accurate and comprehensive description of the process of financialization sets up the central dilemma of the book: “Who controls investment?” The answer of course is capital and, in particular, finance capital. And the result of the finance sector’s unaccountable control over this critical economic process is not simply the growth of inequality, the increasing severity of financial crises, and the breakdown of the climate, but also the erosion of our democracy. As McCarthy says:
The twenty-first century has thus far been a century of mesmerizing surplus extraction, worker precariousness, macroeconomic instability, and climate catastrophe. . . . How have the financial institutions and actors that benefit from [these processes] . . . pulled off this self-defeating heist? The answer is their power in politics and the near-complete absence of the power of the demos in modern democracies.
Insulated From Democracy
In a capitalist society, financial decision-making is insulated from democracy, even as the decisions taken by financial institutions shape the trajectory of that society and the lives of all the economic actors who compose it. Financial institutions are responsible for making critical decisions about the allocation of credit and investment, with little public oversight, with the sole concern of augmenting their own wealth and power.
The power of financial institutions within a capitalist economy is a central component of what in Vulture Capitalism I call “capitalist planning.” Free-market theorists would respond by arguing that financial institutions do not plan per se; they simply respond to market signals. The job of a good wealth manager is to pick out the investments that are likely to generate the highest return for his clients. The market decides; financial institutions follow.
But this logic only applies in the make-believe universe inhabited by professional economists. In reality, the decisions made by financial institutions shape which investments become profitable, and which fall by the wayside. Financial institutions do not simply follow the market; they often lead it. These institutions are capable of wielding such power because they are, to some extent, insulated from competition. Yet this immense power is not constrained by any democratic accountability.
McCarthy deftly explains how the power of big finance rests on its “asset power”: that is, its power “over the productive assets at the core of a political economy’s accumulation model that they direct.” Capital’s control over productive assets, McCarthy argues, underlies all the other forms of power it is able to wield in a capitalist economy. Without this control over society’s productive capabilities, capitalists would not have the organizational, financial, and structural resources to “push and prod their way through the chess game of capitalist democracy.”
Rather than constraining the power of productive capital relative to finance capital, financialization has augmented the asset power of capital as a whole by making assets more mobile and more liquid. When capital assets are fixed and illiquid, it is harder to move them out of the country — as in capital flight — or cease investment altogether — as with capital strikes. Financial assets that are fixed in place, argues McCarthy, “always face a greater risk of being subject to democratic demands for appropriation, redistribution, and . . . democratic extension.”
The process of financialization has undermined this fixity, augmenting the asset power of capital. This relationships works in a number of different ways:
States have a far harder time taxing mobile assets, mobility makes the provision of social services more difficult, and labor and social democratic parties find it far harder to win meaningful reform when capital can be diverted outside of a political territory.
McCarthy uses the examples of Salvador Allende’s Chile and François Mitterrand’s France to show how finance capital learned early on how to use its power to discipline sovereign governments into submission.
But it’s not just that financial institutions are able to wield power over workers; it’s that they wield much of their power through workers. The privatization of pensions, a central part of the neoliberal revolution, resulted in the growth of large asset managers, responsible for the investment of other peoples’ savings without any democratic oversight. These institutions have channeled workers’ savings into industries that undermine their interests, such as the oil industry. They then use their power as shareholders to enforce corporate practices that further undermine workers’ interests by, for example, demanding cost-cutting measures such as wage cuts to boost returns.
In McCarthy’s view, the political power of finance capital is in large part “an effect of large numbers of people relying on financial assets to generate their own incomes and savings.” The very fact that we rely on financial institutions to manage our pensions and provide us with loans and bank accounts allows them to deepen and extend their power over our lives.
Democratize Finance
The concentrated power of finance means that investment is weighted toward assets that harm the interests of workers and strengthen those of capital. We live in a world of underinvestment in essential public goods such as affordable housing, public transport infrastructure, and renewable energy. At the same time, companies responsible for wrecking the climate, poisoning workers’ bodies, and corrupting our democracies find it easy to access lending and investment.
This imbalance is an inevitable result of the concentrated power of finance capital. You wouldn’t expect an authoritarian ruler to pay much attention to the interests of his citizens as long as there was no threat of revolution. In the same way, why should financial institutions pay attention to the interests of ordinary people who have no role in financial decision-making processes?
The only way out of this bind, argues McCarthy, is to democratize finance. McCarthy proposes a new vision of economic democracy, based on the ancient Athenian model. He proposes the establishment of new financial institutions governed by “minipublics” — much like the one described in the introduction — that would be charged with determining how the resources of their town, region, or nation should be invested.
The minipublics that would govern these new financial institutions would be chosen through a process of sortition, through which members are selected at random to ensure broad social representation. McCarthy writes:
These new democratized financial institutions, at every scale, should be built on a dialogic process of deliberation that not only [identifies] socially and ecologically desirable ways to allocate investment and credit but also [helps] to articular a common working-class political culture and identity, while at the same time giving a platform to the particular needs, grievances, and concerns of subsections of the demos.
He argues that choosing assemblies through sortition is the “most feasible and desirable way to bring working people into meaningful political deliberation and decision making.” He draws on examples from around the world to make his case. Ireland’s citizens’ assemblies helped to create consensus on controversial issues such as abortion and same-sex marriage. In Bogotá, Colombia, the Itinerant Citizen Assembly was set up to develop collective recommendations to the city council on issues such as urban planning. The government of Ostbelgien, Belgium, has set up a permanent citizens’ council to survey public opinion and develop policy proposals.
McCarthy argues that this model could be scaled up to create a tiered network of institutions governed by democratic bodies that would make decisions around investment. For example, a community-based public bank governed by a minipublic of local citizens might decide to invest in affordable housing, community parks and gardens, or community energy companies. At the national level, a public investment bank governed by a representative panel of citizens might decide to direct investment toward renewable energy or improving public transport infrastructure.
Taking On Capital
The vision McCarthy suggests should appeal to voters across the political spectrum. Those on the Left will appreciate his proposals to challenge the concentrated power of finance capital. Those in the center will appreciate his focus on citizens’ assemblies as a means to strengthen crumbling liberal democracies. Even some on the Right should appreciate the idea of handing power back to communities and allowing them to make decisions about their collective futures. The Master’s Tools provides a model that puts meat on the bones of the pro-Brexit slogan “Take Back Control.”
For precisely this reason, these proposals will be fiercely resisted by capital and its allies throughout the state. Financial institutions would resist any move to curtail their powers over investment. If this model was passed into law, these institutions would likely respond with capital flight or capital strike. But they would probably use their coordinated power to prevent these proposals from entering the political mainstream in the first place.
This is the main challenge McCarthy’s model faces: it requires a mass political movement to get off the ground. The democratization of finance is not something that can happen through legislative fiat. As McCarthy himself acknowledges, the capitalist state is a social relation, and legislative outcomes reflect the balance of power in society. His measures, if implemented, would go some way to shifting that balance of power. But this is precisely why they would never be enacted from the top down.
The catch-22 of democratizing finance is the same one that plagues all debates on the Left about policy change: you need power to get power. This is why it is so important for the Left to focus on building power at the grassroots. Realizing the promise of democratic innovations like community wealth building requires the democratization of finance. But the democratization of finance requires building power in communities, workplaces, and on the streets. These two visions of political change — bottom up, and top down — are not competing, but complementary.
Were the Left able to build the foundations required for the construction of this model, the rewards would be significant. The Master’s Tools promises the creation of a society based on equity, public participation in decision-making, and the redirection of investment toward solving the greatest challenges humanity faces. The book is a clarion call to rethink the foundations of our financial system and build a democracy that works for the many, not the few.
Grace Blakeley is a staff writer at Tribune (UK), and the author of Stolen: How to Save the World from Financialisation.
On Transitioning to a Participatory Economy
March 5, 2025
Source: Participatory Economy Project
I wrote a recent essay on how the model of a participatory economy (MPE) can help preserve the environment. I reposted that essay on Daily Kos, a website aligned with the Democratic Party in the United States. My goal was to widen awareness of MPE with an audience that I thought might be receptive, but I was stunned to see the very first comment in reply to my post:
“How do we start implementing this today?”
I have to admit, I was taken aback by the question, and I gave an answer that was less-than-satisfying, comparable to saying “we need to build awareness, go tell your friends”. But upon reflection I was also encouraged by the comment: Maybe we are closer than any of us realize to instantiating a participatory economy. If so, then we need to take the question seriously. How do we start implementing this? Assuming that MPE is what we want, what is the step-by-step process to instantiate it? What is the recipe to follow where I do something as step one then I do something else as step two and then continue for some number of steps and at the end of it the world is transformed into a participatory economy?
This is a question about what’s been called transition strategy, a topic that should get more attention but doesn’t. (Some of the reasons why merit a separate discussion, perhaps a separate essay of their own.) As Robin Hannel, co-inventor of MPE, wrote in 2005: “If I had a nickel for every person who told me how much they liked the idea [of MPE], but could not imagine any way to get there from where we are today, I would already be retired.”
It seems daunting and seemingly insurmountable, but then so did inventing the model that addressed a problem which “perplexed” John Maynard Keynes himself. If we could provide an answer to the question “What are you for?” then we can surely provide an answer to the question “How are you going to make it happen?” In this essay, I will try to provide an answer, however flawed and tentative it may be.
Some past literature on transition strategy
Fortunately, I’m not the first to wrestle with the question. Robin Hahnel at the end of his excellent book “Economic Justice and Democracy” addressed the transition strategy with three broad categories: “Economic Reform Campaigns”, “Economic Reform Movements”, and “Experiments in Equitable Cooperation”. That is, a variety of efforts are necessary to build the movement for a better society.
Eric Patton wrote on ZNet an outstanding essay called “Winning” in which he outlined an approach to society-wide transformation. The key point is “the real threat is always that of a good example”. That is, we should build an example “too large to ignore” which would then inspire people on the left to learn about MPE and then begin demanding it, leading to a cascade of positive effects on the left and then across the society on the whole.
The book Real Utopia, a compilation of essays from a number of participatory society advocates (disclosure: I helped write an essay in the book), includes two essays that squarely work on society-wide transition theory. In one essay, Ezequiel Adamovsky proposes an organization that serves as a safe-space of sorts for various social justice movements which he calls the Assembly of the Social Movement (ASM). Different movements assemble into the ASM, which then grows over time and exerts its power in various ways for social betterment. In another essay, Brian Dominick outlines the task in broad strokes as follows:
We are back to looking at strategy in terms of steps instead of fell swoops. We change some minds…we build some institutions and an increasingly cohesive movement; that movement helps change more minds; those minds resist oppressive institutions and help develop liberatory ones. The process continues until we have changed a ‘critical mass’ of institutions and minds. At that point, the institutions we’ve already built are seen as the pioneer projects of a new society, prompting us to fall in line or be rendered obsolete.
Institutions and minds
If we follow Dominick’s statement, which are echoed as well by Patton and by Hannel, that is what we need to achieve: a critical mass of institutions and minds. That leads to some questions: How many institutions have we built? How many minds have we won over? What is our “conversion rate”? Sad to say, I’m not sure of any efforts that track that (that would be another follow-up essay, perhaps a follow-up project). I think that MPE advocates should keep track of the numbers of institutions and minds won over, and in so doing track our progress. If those numbers are not increasingly growing, we would know that something is wrong and we can course-correct if need be.
When it comes to creating institutions, I would offer some points to keep in mind.
Add in charisma, fun, and joy. If we think we have a better model, it should be the kind of thing that should inspire people to want to be a part of it. We shouldn’t have to preach and convert and whine; it should be demonstrated automatically. We’re part of something awesome and incredible; don’t you want to be a part of this? The institutions that we create should be so wonderful that they sell themselves (to borrow a capitalist phrase).
Defend against outside attacks. Despite the intent to make joyous institutions and a better tomorrow, there are elements in society which do not want that and will act to crush that, as they have many times in the past. To the extent possible, we should include in our institutions defense mechanisms that help protect our institutions from outside interference. Along these lines…
Have clear and explicit rules from the start. To reduce friction and avoid possible conflicts (including intrusion from outside antagonists), the institutions that we make should have explicit rules for handling various sorts of interpersonal concerns. One project along these lines may be to create an organizational rules template which can be shared and improved by participatory-minded institutions.
Be prepared to win. My interpretation of the history of both Occupy Wall Street and the Independent Media Center is that both projects were unprepared for their success and ensuing popularity, which affected the long-term prospects of both projects. There’s a belief that the institutions we create won’t catch on, but then again they might. The institutions we create need to be ready for that. How would such institutions work when scaled in size and in reach? It may be crazy to consider, but we are living in crazy times. Why shouldn’t we think about what happens when we win?
Be an explicit part of a larger whole. The institutions we create should be a larger part of a cohesive whole, and explicitly so. As an example, the institutions could be member-organizations of a larger organization that can help with outreach (maybe even a logo shared among all member-organizations). In this way, the organizations can help one another, and keep their orientation as “pioneer projects of a new society”, rather than as endangered oases in the desert of capitalism.
I wrote a recent essay on how the model of a participatory economy (MPE) can help preserve the environment. I reposted that essay on Daily Kos, a website aligned with the Democratic Party in the United States. My goal was to widen awareness of MPE with an audience that I thought might be receptive, but I was stunned to see the very first comment in reply to my post:
“How do we start implementing this today?”
I have to admit, I was taken aback by the question, and I gave an answer that was less-than-satisfying, comparable to saying “we need to build awareness, go tell your friends”. But upon reflection I was also encouraged by the comment: Maybe we are closer than any of us realize to instantiating a participatory economy. If so, then we need to take the question seriously. How do we start implementing this? Assuming that MPE is what we want, what is the step-by-step process to instantiate it? What is the recipe to follow where I do something as step one then I do something else as step two and then continue for some number of steps and at the end of it the world is transformed into a participatory economy?
This is a question about what’s been called transition strategy, a topic that should get more attention but doesn’t. (Some of the reasons why merit a separate discussion, perhaps a separate essay of their own.) As Robin Hannel, co-inventor of MPE, wrote in 2005: “If I had a nickel for every person who told me how much they liked the idea [of MPE], but could not imagine any way to get there from where we are today, I would already be retired.”
It seems daunting and seemingly insurmountable, but then so did inventing the model that addressed a problem which “perplexed” John Maynard Keynes himself. If we could provide an answer to the question “What are you for?” then we can surely provide an answer to the question “How are you going to make it happen?” In this essay, I will try to provide an answer, however flawed and tentative it may be.
Some past literature on transition strategy
Fortunately, I’m not the first to wrestle with the question. Robin Hahnel at the end of his excellent book “Economic Justice and Democracy” addressed the transition strategy with three broad categories: “Economic Reform Campaigns”, “Economic Reform Movements”, and “Experiments in Equitable Cooperation”. That is, a variety of efforts are necessary to build the movement for a better society.
Eric Patton wrote on ZNet an outstanding essay called “Winning” in which he outlined an approach to society-wide transformation. The key point is “the real threat is always that of a good example”. That is, we should build an example “too large to ignore” which would then inspire people on the left to learn about MPE and then begin demanding it, leading to a cascade of positive effects on the left and then across the society on the whole.
The book Real Utopia, a compilation of essays from a number of participatory society advocates (disclosure: I helped write an essay in the book), includes two essays that squarely work on society-wide transition theory. In one essay, Ezequiel Adamovsky proposes an organization that serves as a safe-space of sorts for various social justice movements which he calls the Assembly of the Social Movement (ASM). Different movements assemble into the ASM, which then grows over time and exerts its power in various ways for social betterment. In another essay, Brian Dominick outlines the task in broad strokes as follows:
We are back to looking at strategy in terms of steps instead of fell swoops. We change some minds…we build some institutions and an increasingly cohesive movement; that movement helps change more minds; those minds resist oppressive institutions and help develop liberatory ones. The process continues until we have changed a ‘critical mass’ of institutions and minds. At that point, the institutions we’ve already built are seen as the pioneer projects of a new society, prompting us to fall in line or be rendered obsolete.
Institutions and minds
If we follow Dominick’s statement, which are echoed as well by Patton and by Hannel, that is what we need to achieve: a critical mass of institutions and minds. That leads to some questions: How many institutions have we built? How many minds have we won over? What is our “conversion rate”? Sad to say, I’m not sure of any efforts that track that (that would be another follow-up essay, perhaps a follow-up project). I think that MPE advocates should keep track of the numbers of institutions and minds won over, and in so doing track our progress. If those numbers are not increasingly growing, we would know that something is wrong and we can course-correct if need be.
When it comes to creating institutions, I would offer some points to keep in mind.
Add in charisma, fun, and joy. If we think we have a better model, it should be the kind of thing that should inspire people to want to be a part of it. We shouldn’t have to preach and convert and whine; it should be demonstrated automatically. We’re part of something awesome and incredible; don’t you want to be a part of this? The institutions that we create should be so wonderful that they sell themselves (to borrow a capitalist phrase).
Defend against outside attacks. Despite the intent to make joyous institutions and a better tomorrow, there are elements in society which do not want that and will act to crush that, as they have many times in the past. To the extent possible, we should include in our institutions defense mechanisms that help protect our institutions from outside interference. Along these lines…
Have clear and explicit rules from the start. To reduce friction and avoid possible conflicts (including intrusion from outside antagonists), the institutions that we make should have explicit rules for handling various sorts of interpersonal concerns. One project along these lines may be to create an organizational rules template which can be shared and improved by participatory-minded institutions.
Be prepared to win. My interpretation of the history of both Occupy Wall Street and the Independent Media Center is that both projects were unprepared for their success and ensuing popularity, which affected the long-term prospects of both projects. There’s a belief that the institutions we create won’t catch on, but then again they might. The institutions we create need to be ready for that. How would such institutions work when scaled in size and in reach? It may be crazy to consider, but we are living in crazy times. Why shouldn’t we think about what happens when we win?
Be an explicit part of a larger whole. The institutions we create should be a larger part of a cohesive whole, and explicitly so. As an example, the institutions could be member-organizations of a larger organization that can help with outreach (maybe even a logo shared among all member-organizations). In this way, the organizations can help one another, and keep their orientation as “pioneer projects of a new society”, rather than as endangered oases in the desert of capitalism.
Mitchell Szczepanczyk is a software developer, media producer, political activist, aspiring polyglot, degree-holding linguist, and game show aficionado. He has written two e-books, and contributed to the books Real Utopia and Democratic Economic Planning. Mitchell has been involved with groups working on the heterodox economic model known as a "participatory economy"; he co-founded CAPES, the Chicago Area Participatory Economics Society, and has organized events with CAPES. He is currently helping to develop computational models of a participatory economy. A son of Polish immigrants and a native of Michigan (USA), he makes his home in Chicago where he has lived since 1996.
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