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A socialist development strategy for the 21st century (Part 1): The emergent socialist state

1. Introduction

Capitalist development is based upon labour exploitation and environmental destruction. Through sexism and racism it has established second class citizens who are doubly-exploited. Democracy under capitalism is of the ‘low-intensity’ variety—where decision over economic resource generation and use are off-limits to the majority of the population, and where political systems facilitate the (mis)representation of the electorate. As I show in The Struggle for Development, capitalist development enhances the privilege and wealth of a tiny minority of the world’s population, and underpins the prevalence of global labouring class poverty.

What might an alternative, socialist development agenda look like?

The following two-part article represents a thought experiment. It is based upon the assumption that in the near future a labouring class movement, with support from a small-farmer/peasant sector, conquers political and economic power in a poor country. This conquest occurs through a combination of parliamentary victories and mass, extra-parliamentary social struggles. Part of this assumption is that labouring classes in poor (‘less developed’) countries are more likely to conquer political and economic power than those in rich countries, as they confront the weakest links of the imperial capitalist chain.

Once such a conquest of power has been achieved, how might the previously capitalist state be re-constituted? What kinds of institutions might be established to channel, preserve and expand labouring class power? And where would the resources come from to pursue socialist development in a poor country?

The argument of this essay is that we must think of socialist development strategies as beginning in a single state, one that exists within a capitalist geo-economic world system. A socialist development strategy in a poor state must contribute to 1) immediately ameliorating the conditions of the labouring classes; 2) establishing the foundations for the (re)production of labouring class power through a newly established state, and, 3) increasing the possibilities for other socialist states to emerge, and collaborate, within (but ultimately beyond) the capitalist world system.

While it is often argued within socialist circles that development cannot occur before a strong (capitalist) economic base has been established, the argument here is that the material resources required to address the needs of labouring classes already exist in poor countries. Indeed, promoting development on a capitalist basis is erroneous in both strategy and in analysis. As a strategy, it legitimates expanded capital accumulation and the continued subjugation of labour to capital. Analytically, it represents a failure to recognise that significant amounts of already-established wealth is being generated in poor countries.

The core issue here is not, therefore, the generation of more wealth upon which to found future socialist societies. It is, rather, the utilisation of already-existing wealth to ensure real human development for and by labouring classes. The social relations within and through which that wealth is generated and distributed is what ultimately determines the feasibility of socialist development.

The remainder of the first part of this article is organized as follows. Section 2 addresses the initial problems that labouring classes may encounter following their conquest of power—specifically, establishing, reproducing and extending that power. Section 3 considers the beginnings of a newly established socialist state, and how labouring classes will need to re-absorb state power into society. Section 4 outlines how the material basis already exists for the beginnings of socialist transformation in contemporary poor countries. It argues for a radical re-distribution of wealth through the establishment and expansion of egalitarian social relations.

2. Intermittent Revolution1

The initial conquest of political power by labouring classes will not mean the transcendence of capitalism. Rather it will represent a new, heightened, phase of the struggle for a transition to an alternative mode of production. It will be undertaken using tools inherited from the past:

It must be kept in mind that the new forces of production and relations of production do not develop out of nothing, nor drop from the sky, nor from the womb of the self-positing Idea; but from within an antithesis to the existing development of production and the inherited, traditional relations of property (Marx 1993, 278).

There will be numerous firms where capital-labour relations still exist. Large numbers of unemployed workers will be seeking work and incomes. Households will still, in all probability, be women-led, dependent upon work-based incomes, and orientated towards (re)producing current and future generations of workers. At the outset, the majority of land will be held by a small minority of capitalist farmers and/or landowners. Foreign trade will occur on capitalist terms. Financial institutions and their power within the economy will remain highly concentrated. Gender, racial and ethnic discriminations will continue to exist. Democratic institutions will be dysfunctional from the perspective of establishing a genuinely participatory society.

Under such circumstances the policies and strategies of an emergent socialist state need simultaneously to expand and enhance the dynamism of labouring class power whilst reducing the power of capital. Such a situation represents a transitional phase—where the old capitalist system is dismantled while a new democratic system is constructed.

A significant period of time will be required to subordinate capitalist to socialist social relations. Precisely because of this drawn-out, contradiction-laden process, it is doubly necessary to consider how an emerging labouring class state can maintain the initial enthusiasm and energy of the classes that have created it, facilitate their enhanced social reproduction, and contribute, at an unknown time in the future, to the global expansion of socialist human development.

The process of enhancing labouring class power can be conceptualised as an intermittent revolution (Tugal: 2016). Such transformations will occur over the short-medium and long-term, and will take many forms. For example: the development of cooperatives and communes; an expansion of the availability of means of survival (food production and distribution, healthcare, etc.); new systems of participatory education; and, in the medium and longer-term, the accumulation of political experience (of defending and extending labouring class power). An outward looking foreign policy can complement the domestic extension of labouring class power, through collaboration with international social movements to construct solidarity for the new regime (and crucially, to defend it from hostile intervention) and, when opportunities arise, to extend the process internationally of labouring class power (see part 2 of this article).

The initial emergence and establishment of a democratic labouring class state in one country is the precondition for the emergence of other such states. And the advent of the latter are necessary in order to preserve the gains of the former over the long-run. In all likelihood there will be a significant time-lag between the emergence of the first such state, and its global multiplication. It is within this time-lag that a socialist development strategy must be formulated and pursued.

3. Re-Absorption of the State by Society2

After studying the Paris Commune, Marx argued that it was ‘the political form at last discovered under which to work out the economical emancipation of labour’, as it would ‘serve as a lever for uprooting the economical foundations upon which rests the existence of classes, and therefore of class rule’ (Marx: 1966 [1871]). He characterized the radical process of changing social relations, and in particular of the relation of state to society as:

[T]he reabsorption of the state power by society as its own living forces instead of as forces controlling and subduing it, by the popular masses themselves, forming their own force instead of the organized force of their suppression—the political form of their social emancipation [Marx: 1966 [1871]).

Societal re-absorption of the state is required to subordinate and transform capitalist social relations. Three organisational principles can contribute to thinking through how such a transformative process might occur (Lebowitz: 2015):

1—Social ownership of the means of production: Capitalist ‘[c]ommodity production has been the social form under which the most completely developed system of social interdependence in human history has been achieved’ (Barker: 1998, 3). However, the means of production are directed autocratically, in accordance with market imperatives of competitive capital accumulation. Such ownership structures deprives workers of any say over how and to what ends production is orientated and reduces them to ‘objects’ to be manipulated by managerial ‘subjects’. Social ownership of the means of production, by contrast, would re-constitute decision-making as a collective democratic process.

2—Labour-Led Social Production: The social ownership of the means of production facilitates the social direction of production through worker-community cooperation. Such cooperation is an essential property of an emergent socialist society for two reasons. First, because it limits, reduces and eventually eliminates production based upon autocratic and anarchic competition. Secondly, because the lifeblood of socialist development is cooperation (within and beyond workplaces).

3—The Identification and Satisfaction of Communal Needs and Purposes: Under capitalism rival firms vie to secure competitive advantage. Labouring class households and individual members compete against each-other to secure the best jobs. Communal-based organisation, organized within and beyond workplaces represent an alternative logic of social reproduction. The identification and satisfaction of communal needs and purposes will be predicated upon cooperation within and between workplaces and communities.

How might these organisational principles be put into practice? A process of decentralized, local-level participatory planning represents one possible method (Harnecker: 2014). Under such a system, the social energy generated by planning (drawing up and enacting a plan) flows upwards—from the local to the national level—rather than downwards by firms and states, as under capitalism. A principle informing such a process is that ‘everything that can be done at the lower level should be decentralized to this level’ (Harnecker: 2014). The national economy will be re-organized towards achieving these objectives. Needs and objectives that cannot be met at the local level will be transmitted upwards, to higher planning bodies, which can be incorporated into more general resource generation and allocation strategies.

The establishment and upwards transmission of democratic planning impulses require appropriate scales of participatory planning. These different but interdependent scales can be constituted by neighborhood communities, communes, city/municipal councils and national state bodies (Lebowitz: 2015).

Within a neighborhood community neighbors can meet regularly to discuss with each other what kind of community they want to live in, and then to identify and coordinate the communities’ needs and capabilities of fulfilling those needs. The likelihood of a precise match between community needs and ability to fulfil those needs is small. The purpose of local-level planning is, in part, therefore, to identify and to communicate upwards what additional resources are required and what surplus capacities are available.

Combining the various neighborhoods and workplaces, the commune represents the next scale of decentralized participatory planning. Information from the communities is assembled and discussed within workplaces. Can workers satisfy the needs of the communities which comprise the commune? Under capitalism, where production is orientation towards the generation of exchange values (for profitable sale onto markets) such considerations are secondary (if at all) to those of profit-maximization. Under an emergent socialist society, the identification of and attempts to meet local needs begins the process of substituting use values (goods produced to satisfy laboring class needs) for exchange values. Through communal meetings councils can generate data on:

  1. Needs that can be and are satisfied by and within the community and commune,
  2. Needs that cannot be satisfied by the community (which need further assistance from the commune and beyond),
  3. Workplaces’ surplus capacity (that can contribute to meeting needs of other communities and communes).

Surplus capacity and unmet needs are communicated further up the participatory planning chain to larger-scale units—from communal cities to the national state. As communes draw up lists of needs, their (in)abilities to meet them and their surplus capacities, the national-level State commune can assess how to generate and allocate resources. Where there are excess needs, discussions will revolve around mechanisms to increase output, the (regional or social) re-allocation of resources, and/or possibilities for reducing the satisfaction of some needs.

Through decentralized participatory planning participants attain knowledge about resource availability, production and allocation. In her distillation of the experiences of decentralized participatory planning in Brazil, Venezuela and India, Marta Harneker writes how it represents a double process:

[F]irst… the plan, which has been elaborated in a participatory manner; and… second…the transformation of people through their practice…[It] is an educational process in which those that participate learn to enquire about the causes of things, to respect the opinion of others, to understand that the problems they face are not exclusive to their street or neighborhood but are related to the overall situation of the economy, the national social situation, and even the international situation…Through this, new relations of solidarity and complementarity are created that place the emphasis on the collective rather than the individual (Harnecker: 2014).

Decentralized participatory planning will require some central coordination, and ultimately the power to determine resource allocation. Its extent cannot be determined in the abstract, and would depend on considerations ranging from variations in different communes’ abilities to meet their needs, to changing global circumstances. In cases where communes are able easily to meet their own needs, it is probable that a relatively low-level of central coordination would be required. In situations where there are stark regional communal disparities, a relatively higher degree of central coordination would be required to coordinate resource transfers from more to less advantaged regions.

4. Redistribution: Reclaiming Social Wealth

The core argument in this section is that redistribution of wealth through the transformation of social relations represents the fastest means to alleviate poverty and, in so doing, establishes genuinely progressive possibilities and processes of human development.

It is often objected that while such redistribution would contribute to meaningful human development in already-wealthy countries (where the pie to be redistributed is relatively large), it is unlikely to do so in relatively poor countries. These countries, rather, need to accumulate wealth prior to redistributing it, and consequently, they must undergo a process of rapid capitalist development. Non-capitalist development is thus precluded for one, or many, generations.

Such arguments often take for granted, or simply ignore, ways in which capitalist classes in poor countries are able to accumulate wealth, often offshore, and shield it from national taxation and potentially democratically determined use. For example, a recent study by Ndikumana and Boyce (2011) show how sub-Saharan Africa has:

[E]xperienced an exodus of more than $700 billion in capital flight since 1970…. Africa is a net creditor to the rest of the world in the sense that its foreign assets exceed its foreign liabilities. But there is a key difference between the two: the assets are in the hands of private Africans, while the liabilities are public, owed by the African people at large through their governments.

This is compared to Africa’s $177 billion in external debts (Ndikumana and James K. Boyce: 2011). The tax justice network (2012) provides data for 139 ‘mostly low-middle income countries’ and notes that:

[T]raditional data shows aggregate external debts of US$4.1 trillion at the end of 2010. But take their foreign reserves and unrecorded offshore private wealth into account, and the picture reverses: they had aggregate net debts of minus US$10.1-13.1 trillion…[T]hese countries are big net creditors, not debtors. [However], their assets are held by a few wealthy individuals, while their debts are shouldered by their ordinary people through their governments.3

Deborah Rogers and Bálint Balázs (2016), demonstrate that in very poor countries a relatively small distributions of wealth from rich to poor could eliminate poverty:

Using numbers which approximate those of Bangladesh in 1995/96, a redistribution of 3 percent of the income from the top quintile (reduced from 40.2 to 37.2 percent) to the bottom quintile (raised from 9.3 to 12.3 percent) results in a reduction in extreme poverty from 20 to 0 percent.

They continue: ‘Attempting to reduce poverty by a similar amount through growth of the economy requires an expansion of total income of approximately 45 percent’ (Rogers and Balázs (2016, 62).

In a similar vein Chris Hoy and Andy Sumner show how very limited wealth redistribution (through, for example re-direction of fuel subsidies away from their relatively well-off beneficiaries to the poor) can have significant effects: ‘most developing countries have the financial capacity to end poverty at the…$1.90, or a slightly higher line of $2.50 and potentially $5 a day (Hoy and Sumner: 2016, 3).

In these calculations, rather conservative (money-based) definitions of poverty are used. Moreover, they calculations presume limited wealth redistribution within still-existing capitalist social structures. Our conception of socialist development entails a broader, social, conception of wealth. It includes not just income and money, but the means of producing social wealth itself—from land and workplaces, to the natural environment. Under capitalism this wealth is socially-produced but privately owned. Our objectives are to transform, radically, the production of society’s wealth through socializing its ownership and its democratic direction.

5. Conclusions

This essay has outlined, in rather abstract terms, some broad principles of socialist development which would occur through the transformation of social relations. The distribution of money wealth represents a necessary first step to eliminating poverty. However, such measures have their limits as wealth distribution requires its prior production. Under socialist organization and distribution, how might the production of social wealth contribute to further improving the conditions of a poor country’s population? Part 2 of this article represents a more concrete element of our thought experiment, by providing a 10-point plan for such a development strategy.