On Democracy and Socialism

A reply to Seth Ackerman's "The Red and the Black."

Seth Ackerman’s piece, “The Red and the Black” is refreshing and imaginative. It sympathizes with Marx’s scorn for concocting recipes for the cookbooks of the future while, at the same time, offering a kind of inspiration that can only be drawn from envisioning radical alternatives. My hope is that it generates a wide variety of critical responses, but here I only want to explore one theme: democracy.

Let me be clear: by “democracy” I have in mind something altogether different from the electoral institutions that exist in contemporary capitalist societies such as the United States. These institutions give the vast majority of the population little real control over the basic structure of society. Whenever I speak of democracy in what follows, I have in mind something simpler and more radical — an association in which persons consciously govern their common affairs on a footing of genuine equality through public reasoning and discussion.

Ackerman says a lot about markets and the experience of bureaucratic central planning, but he says a lot less about the traditional socialist demand for working-class control over economic life. Although he tells us that his primary topic is “the conflict between the pursuit of private profit and the satisfaction of human needs,” I couldn’t help but wonder how radical democratic energies fit into the picture.

Socialism, after all, isn’t merely about servicing human needs or “delivering the goods” — it’s also about bringing the economic structure society under democratic control. A young Alasdair MacIntyre wrote that “it is typical of class society that social life appears as something given outside our control, in which we can only play a pre-arranged part.” Socialism, in contrast, would be “the victory of consciousness over its previous enslavement by economic and political activity. All other forms of society have been suffered by human beings; socialism is to be lived by them.”

The central idea here is that socialism is about creating social relations which would enable us to collectively self-govern our common affairs — economic and otherwise — in a conscious, rational way, free of all forms of oppression and exploitation. To my mind, Ackerman leaves this important socialist theme underdeveloped.

There is, of course, a tradition — call it “socialism from above” — that has, in good technocratic fashion, tended to reject democracy by modeling socialism in terms of an allocation of goods parceled out by a bureaucratic agency over which the population has no control. Ackerman makes it clear that he rejects this top-down approach in favor of a socialism built from the bottom up, but his discussion of market socialism touches only obliquely on the topic of democratic control of economic life.

I don’t think this is a side issue, inasmuch as the market and the democratic forum are two fundamentally different forms of social organization.

Compare and contrast: The individual consumer in a market has the mere capacity to “exit” or refuse to buy what has already been produced, whereas the democratic citizen has a “voice” in an as yet unsettled collective decision. The individual consumer in the marketplace acts on the basis of inward-looking preferences, whereas the participant in a democratic assembly puts forward reasoned, public argument about how to solve some matter of collective concern.

Interactions in markets are strategic and self-regarding — bargaining proceeds on the assumption that participants want to buy cheap and sell dear — whereas participants in a democratic forum interact on the assumption that they share an interest in solving a collective problem in a way that advances the common good. Markets depoliticize questions of social choice whereas democracy makes decisions political by raising them to the level of public criticism and debate. There are probably more contrasts worth noting, but I think you get the point.

The traditional liberal response to this tension between markets and democracy is to say that each has its proper time and place: the market is the appropriate mechanism for the economic sphere whereas the forum is the appropriate device for the political sphere of the state. Socialists, however, staunchly oppose this separation between the (allegedly) private sphere of economic life and the official public realm of politics. Instead, they’ve struggled to rethink and expand our conception of the political to include not the mere levers of the state, but society as a whole. So, given that Ackerman envisions markets playing a significant role in socialism, he owes us an account of how they might be politicized and tamed by the popular will.

Ackerman argues that

. . . [f]irms’ autonomy to choose their products and production methods means they can communicate directly with customers and tailor their output to their needs — and with free entry customers can choose between the output of different producers: no agency needs to spell out what needs to be produced.

Interpreted metaphorically, I see how the claim makes sense. But, taken literally, it strikes me as false. In a market, consumers do not directly communicate with producers about their needs at all — their choice is merely whether or not to buy what’s already on the shelf. A more technical way to say this would be that consumers in a market have no voice, they only reserve the capacity to exit the transaction — i.e. to individually refuse to buy what has already been designed, marketed and produced on their behalf.

The market is simply not the sort of thing that enables consumers to have direct deliberative input in decisions about what socially-recognized needs should be reflected in economic production. To value direct communication and conscious coordination is to desire something other than markets.

Ackerman acknowledges as much when he discusses the ways that markets facilitate complex divisions of labor among persons who have no direct communicative interactions at all. As he would no doubt agree, it is a defining feature of the market that it coordinates behavior indirectly, “behind the backs” of those involved. Persons in a marketplace don’t get together and collectively communicate in order to formulate coherent overall plans. Rather, they all privately go about their business in search of individual buyers and sellers. The overall consequences that arise from these market activities, even if beneficial, are not the result of conscious willing or direct communication on the part of those involved.

Among other things, this non-communicative dimension of markets brings out the fact that they don’t require us to justify our consumer preferences to others. In the market, it doesn’t matter why I have a consumer preference — it only matters that I have it. This is, perhaps, one of the virtues of markets if anything is. After all, who likes having to attempt to justify to someone else why they wanted to eat one flavor of ice cream rather than another? And what could possibly be gained by attempting to deliberate collectively about what shape of pasta is the best?

Perhaps this is just as it should be in the case of pasta and ice cream flavors. The problem is that markets, informationally speaking, reduce all of our economic views, judgments, and principles to the model of (potentially frivolous, unreflective) consumer preferences. The standard economics story teaches us that individual preferences are “revealed” through the market activities of agents. When I buy a pint of ice cream for a certain price, I “reveal” an individual preference for it — and the price I pay registers the intensity of that preference relative to other consumer preferences I might have.

Thus, as far as the market is concerned, deeply important decisions about investment priorities, environmental impact, growth rates, tradeoffs between savings for the future and current consumption, the scale and location of production, employment and so forth are to be determined in exactly the same way as decisions about which flavors of ice cream to produce — on the basis of an aggregation of de-politicized individual preferences.

Now, a lot is at stake — socially, economically and environmentally—in how these big decisions get made. These are urgent political matters that we need to think about critically and collectively discuss so that we can get them right. What’s more, these matters have long-run ramifications — think of the pressing environmental concerns at stake — which make them unsuited to decision-making processes that draw on short-run individual preferences for certain forms of private consumption. Thus, to leave such urgent problems to be solved by the machinations of market forces, that is, to decide them on the basis of a collection of inward-looking, unexamined personal preferences, is ill-advised to say the least.

This is precisely why socialists have often advocated conscious, democratic planning as a reasonable alternative to the market. The idea is to give priority to decision-making processes that are rational—responsive to public reasoning and argument about the common good—and democratic in the sense that they draw the masses of population into participating in them as much as possible.

In democratic deliberation, the basic informational inputs used to make most decisions about investment, employment, production and allocation would not be individual preferences, but reasoned public argument. As anyone who has participated in a genuinely democratic debate can attest, our individual preferences often change in the course of grappling with the arguments and proposals advanced by others. Sometimes the requirement that we justify ourselves to others leads us to revise our own views. The political philosopher Elizabeth Anderson puts it like this: “democratic dialogue does not take preferences as given, but transforms them, not just in the sense of changing individuals’ minds about what each wants, but of changing our mind of what we want when we act collectively.”

At its best, socialist democracy would be an experimental, rational, participatory process in which “no force but the force of the better argument” determines what we decide to do together. This makes possible broad social learning processes whereby the collective assessment of past decisions enables us to improve as co-legislators over time. The participatory aspect has the potential to foster a sense of shared responsibility for the outcomes and, perhaps, a feeling that we are cooperating with others on terms of equality to promote the common good. These are benefits that markets, which trade in nothing but aggregations of self-regarding individual preferences, cannot deliver.

This doesn’t mean that democratic planning would somehow eliminate all conflict and disagreement about social priorities. Still less does it mean that real democracy requires a harmony of interests — or wild assumptions about human motivation — to be able to succeed. Rather, democracy gives us a framework within which we can discuss and debate together—disagreeing though we will — about what the basic goals of our social and economic system should be. In this way, democracy raises a key question that markets, as such, do not permit us to raise: what should we do together?

What would this look like in practice? I think it’s a strength of Ackerman’s piece that he poses this question and gives us a serious answer with respect to how markets might operate in a socialist society. I’m curious to know how he might integrate the elements of democracy into his model, but in the meantime I think its worth (briefly) saying something concrete about what a democratically planned economy might look like.

The fleeting historical experiments with democratic planning that we have available to us are inspiring and instructive. But they are radically incomplete, given that just about all of them were crushed externally while they were still in their infancy. That hasn’t stopped socialists from envisioning concrete alternatives, however. Radical economist Pat Devine’s book Democracy and Economic Planning, for example, puts forward an imaginative proposal that deserves serious consideration and debate among socialists.

Devine’s proposal involves democratically-run economic planning bodies at multiple different levels — local, regional and national. National-level debates might focus on general priorities regarding the timescale and amount of investment in infrastructure, means of production, communications, health, education, transport, scientific research, and so on. Regional and local bodies would make decisions about more particular issues. Devine proposes that these different bodies interact by way of “negotiated coordination”, which balances centralized and decentralized forms of democratic decision-making.

What about the specifics of these entities and the relations among them? A fully-developed answer to that question is surely beyond the scope of this short critical response. Moreover, I, like Ackerman, side with Marx in thinking that we risk concocting technocratic instruction manuals if we try to get too specific about the detailed workings of something that doesn’t yet exist. Blueprint or not, however, I hope that I’ve said enough to dash the general worry that democratic governance of economic life is hopelessly impractical or unappealing in principle.

Some things stated above might need clarification. I don’t think that the contrast between the market and the democratic forum means that we must go 100 percent all-in for one or the other. As I say, I do think that the radical democratic core of the socialist project entails that the market should not be the fundamental organizing institution of society. And I agree with Ackerman that the results of planning within “really existing capitalism” and the bureaucratic societies of the former Soviet Union prove — if in a distorted form — that we already have examples of viable alternatives to the market.

But certainly this doesn’t mean that there can be no role at all — not even a peripheral one — for markets in a socialist society. On this I agree with Ackerman. But unless we properly distinguish the market and the forum — and avoid running them together— we are not in a position to grasp why the denizens of a socialist society might want to make trade-offs between them. At the end of the day, however, people in a socialist society should be able to decide for themselves how strike the right balance between democratic planning and markets.

It’s also important to keep the two separated because something is lost when we choose markets over democratic organization, just as something might be lost — efficiency or anonymity, say — when we eschew markets for democracy. However, socialists have traditionally held there to be a strong presumption in favor of conscious, democratic organization over the alternatives. The onus is on Ackerman to explain in greater detail how his recommendations are compatible with this basic socialist goal.