Socialism is the only alterntive

The socialist objective is the simultaneous abolition of capital, wage labour and the state and it will be a self-organised workers movement which will bring about this transformation and socialisation of the means of production. No longer will society be based upon the capitalist system of business expansion and contraction, economic boom and slump, but instead will be replaced by the  collective conscious planned control, exercised by the producers at all levels of society. Socialism is the voluntary and free association of the producers, a conception of the decentralised, self-governing society, federated from the bottom upwards. This is the vision of a communal ownership and social control against the coercive alienated control of the state and of capital. This is a principle of self-emancipation where the working class will educate itself and develop its capacities for self-government through its own organisations.

Marxists are frequently accused of underestimating the complexity of modern economy and that we have  a mistaken view of production relations. We are told that the elimination of commodity production, and instead production for use rather than for exchange is not possible. Those who lack confidence in Marxist thought argue for a more reasonable feasible version of ‘socialism’ that incorporate markets and private ownership of the means of production, in other words, a 'mixed' economy with basic utilities run by public corporations, medium and small scale production undertaken by workers' cooperatives, and private or family concerns operating in many service industries and in retail distribution.

Central planning which socialists are accused of advocating need not entail centralisation in the top-down sense. This can be thwarted by democratic, de-centralised self-management, a system of administration and planning in which the mass of workers themselves allocate resources and democratically determine the priorities. Such a system requires that people articulate their own needs as producers, consumers and that they take control of their living and working conditions, and that they free themselves of the despotism both of the bureaucracy and the tyranny of the market.  Democracy in production is more likely to be realised if production units are smaller and decentralised. This is to bring matters within human scale so that individuals are able to fully participate effectively in processes of decision making and production.

But it can be argued that socialist administration and its practice are complementary and are neither centralising nor decentralising but can be described as centralising from the bottom up. No matter how  ironic it may seem to those who identify Marx with a bureaucratic state-ownership, Marx's earliest political passion was a hatred of bureaucracy and it remained with him throughout his life. Marx's writings embodies the freedom of the individual and argues that the worker of today, subjugated to a specialised function in the factory will give way to the 'individual an all round development' who is able to participate in a diversity of functions in production. Likewise, the Socialist Party looks to replace the coercive power of the state by the democratic community as the legitimate social authority. This new social authority will be the fusion of social and political relationships, removing the existing separation between the state and civic society. A new social network is to become integral to the practical life of the individual. The individual voluntarily constitutes this new identity rather than having it imposed upon individual life from the outside. The new social authority is a legitimate because individuals have given, continue to give and may, if they wish, withdraw their consent.

All the main features of organisation and planning under socialism are to be discerned according to this principle. The subordination of production to the satisfaction of human needs as opposed to the pursuit of profit, the abolition of the state, of capital and of the division of labour in so far as it prevents the participation in the diversity of life activities, the 'end’ of politics as a sphere independent of the practical life of individuals, the abolition of forms of representation disconnected to the practical, everyday world of individuals. Work is no longer a mere means to an end but has also become 'life's prime want', integral to unfolding the individual's human potentialities. Socialism replaces the ruling class control of the state and capital with social control. Socialism has abolished alienated and exploitative relations and its associated producers are capable of instituting a rational organisation of the productive forces.

Economic necessity drove the weavers of Rochdale into co-operation, and the same cause led to its expansion. In the past, optimistic co-operative proponents anticipated that soon they would monopolise the trade of the working class but the supermarkets threaten the very existence of the Co-operative movement. It is argued that they are, like the trade unions, training schools for socialism yet co-operatives are managed on purely business lines, (apart from the funds devoted to educational and charity purposes) and are unable to evolve into a non-exploitative society. Its  centralisation of production and distribution differs little from any chain-store.

Utopians create a blueprint of the future socialist society yet they often neglect to explain the political agency capable of giving practical effect to the blueprint. Utopian socialists confirm the associational principle but had been undermined by their belief that the nexus of power could be bypassed rather than confronted. Many have produced excellent blueprints of the feasible socialist economy, but nowhere do they indicate how their models might be implemented and merely rely upon the reasonableness of ideas to attract popular support. The Zeitgeist Project is an example.

Richard Wolff proposes what he describes as Workers’ Self-Directed Enterprises (WSDE’s) and Gar Alperovitz suggests a “pluralist commonwealth” which is a system of cooperatives, neighborhood corporations, worker-owned companies, social enterprises, land trusts, and municipal utilities—along with, of course, small scale private businesses. Both men are responding to the traditional view of “socialism” as a command economy of state-capitalism , which at one time seemed  progressive to many but now stands revealed as limited to early phases of primitive accumulation and forced industrialisation, where the means of production have been taken over by the state but commodity production continues. The workers themselves remain subject to the political extraction of surplus value presided over by a bureaucratic class. The market has continued, along with the veil of the money form concealing the continued exploitation of the workers. Any idea of social control has been firmly suppressed  by the state. The abundance of cooperative wealth and the free supply of goods and services has nowhere been in evidence in these countries.

Lesser known advocates of market-socialism are:-

Diane Elson in 'Market Socialism or the Socialization of the Market?’ who proposes a model in which firms are publicly owned, internally self-managed but with representatives of consumers and the local community on their boards; the functions of the capital market are assumed by a 'Regulator of Public Enterprises';the dialogue between firms and 'Wage and Price Commissions' sets prices.

Geoff Hodgson puts the case for some form of market socialism, one that has an essential role for democracy in the planning of the economy as a non-capitalist market economy based upon a community of producer cooperatives, each cooperative is owned, and run by the workers themselves. Their products are sold on a market. The purchase the required raw materials themselves.There is little or no central planning. Hodgson describes such a system as 'market collectivist', challenging the identification of the market with capitalism. The market is to be made the servant of 'society', democratically constituted through its social relations, rather than that invisible, anonymous power exercised over society.

Tom Devine's model conceives economic organisation as a process of 'negotiated coordination' among representatives of those affected by the decisions involved, informed by participatory discussion among the multiplicity of affected interests (Democracy and Economic Planning). Devine makes a distinction between 'market exchange’ and 'market forces'. Market exchange involves transactions between buyers and sellers, where what is being exchanged consists of either stocks (inventories) or goods and services produced by enterprises using their existing capacity. Market forces refer to the process whereby changes are brought about in the underlying allocation of resources, the relative size of different industries, the geographical distribution of economic activity, through the interaction of decisions on investment and disinvestment that are taken independently of one another, with coordination occurring ex post.

However we should be fully aware if such idealised forms of ownership were implemented of  the danger of workers' autonomy of it eventually leading to the reintroduction of competition and capitalism and the creation of a social system that distinguishes itself from past capitalism only as regards formal ownership.

“Within the cooperative society based on common ownership of the means of  production the producers do not exchange their products." Marx (Gotha)

 Marx meant that production units will not buy and sell raw materials and producer goods to and from each other and that, as a result markets will not coordinate their economic relation. Thus, the relation between production units in the future society will be like the relation between the different departments of the capitalist firm. Marx argues against a system where the economy is based upon separate, competing cooperative enterprises would re-produce capitalist 'anarchy’. What matters is that the producers are associated with each other and produce according to a common plan. Workers' cooperatives must exist on a large scale and be able to regulate production within a common plan.

However, the conscious control under a common plan advocated by Marxian socialists is not to be identified with the control of an elite organised, in the state envisaged in the genuine democratic control of the producers and citizens. The dominant traditions of socialism, both parliamentary and revolutionary, have sought to achieve socialism through the nationalisation of the means of  production rather than through the transformation of social relation. State ownership, the transfer of the title deeds to property, does nothing in itself to alter the production relations, the relations which are more fundamental than the property relations. There can be no such thing as socialism, in Marx's perspective, without the free association and self-government of the producers.

Contemporary discussions on the viability of  an alternative economy  in the attempt to combine social justice with economic efficiency draws attention to the fundamentally uncontrollable nature of the market system, immunising it from any form of the social control other than socialism. Private ownership may indeed have been replaced by various forms of shared ownership but these enterprises are still directed by market forces.

Marx describes his views on the co-operative movement quite explicitly:
(a) We acknowledge the cooperative movement as one of the transforming forces of the present society based upon class antagonism. Its great merit is to practically show, that the present pauperising and despotic system of the subordination of labour to. capital can be superseded by the republican and beneficent system of the association of free and equal producers
(b) Restricted, however, to the dwarfish forms into which individual wage slaves can elaborate it by their private efforts, the cooperative system will never transform capitalistic society. To convert social production into one large and harmonious system of free and cooperative labour general social changes are wanted, changes of the general conditions of society, never to be realised save by the transfer of the organised forces of society, viz., the state power, from capitalists and landlords to. the producers themselves.
(c) We recommend to the working men to embark in cooperative production rather than in cooperative stores. The latter touch but the surface of the present economical system, the former attacks its groundwork.
(d) We recommend to all cooperative societies to convert one part of their  joint income into a fund for propagating their principles by example as well as by precept, in other words, by promoting the establishment of new cooperative fabrics, as well as by teaching and preaching.
(e) In order to prevent cooperative societies from degenerating into ordinary middle class joint stock companies (societes par actions), all workman employed, whether shareholders or not, ought to share alike. As a mere temporary expedient, we are willing to allow shareholders a low rate of interest.- Marx Inaugural Address of the I.W.M.A.

He was indeed sympathetic to the co-operative model.

Apart from the above he previously wrote in 1864:
‘The value of these great social experiments cannot be overrated. By deed instead of by argument, they have shown that production on a large scale, and in accord with the behests of modern science, may be carried on without the existence of a class of masters employing a class of hands...’

And later in Volume 3 of Capital Marx argued of co-operatives that ‘the antithesis between capital and labour is overcome within them, if at first only by way of making the associated labourers into their own capitalist, i.e., by enabling them to use the means of production for the employment of their own labour.'

However, in each case Marx also described the limitations of co-operatives NOT advocating them as solutions.

‘...however... excellent in principle and however useful in practice, co-operative labour, if kept within the narrow circle of the casual efforts of private workmen, will never be able to arrest the growth in geometrical progression of monopoly, to free the masses, nor even to perceptibly lighten the burden of their miseries. … To save the industrious masses, co-operative labour ought to be developed to national dimensions, and, consequently, to be fostered by national means. Yet the lords of the land and the lords of capital will always use their political privileges for the defence and perpetuation of their economic monopolies. So far from promoting, they will continue to lay every possible impediment in the way of the emancipation of labour. …To conquer political power has, therefore, become the great duty of the working classes.’ (IWMA 1864)

‘Restricted, however, to the dwarfish forms into which individual wages slaves can elaborate it by their private efforts, the co-operative system will never transform capitalist society. To convert social production into one large and harmonious system of free and co-operative labour, general social changes are wanted, changes of the general conditions of society, never to be realised save by the transfer of the organised forces of society, viz., the state power, from capitalists and landlords to the producers themselves.’ (IWMA 1866)

‘The co-operative factories of the labourers themselves represent within the old form the first sprouts of the new, although they naturally reproduce, and must reproduce, everywhere in their actual organisation all the shortcomings of the prevailing system’ (Capital, Vol.3)

Marx was saying that workers taking control of their own productive work processes, of organising co-operatively in firms, appeared to be a positive reaction on the part of workers to private capitalism. As such it was a source of growing confidence for the working class, proof that the historically progressive role of private capitalists had come to an end:

‘Co-operative factories furnish proof that the capitalist has become no less redundant as a functionary in production as he himself, looking down from his high perch, finds the big landowner redundant.’ (Capital, Vol. 3)

Co-operatives are certainly run on capitalist lines; it has to be or they would go under.  But they possess a democratic constitution and are composed mostly of wage-earners who can mould it as they choose. Thus it is distinguished from a normal capitalist concern. If employees are badly paid and otherwise maltreated its members are  to blame and can make good again. That some   have exclusively argued  co-ops as the way to the elimination of poverty in no way proves their uselessness, but rather demonstrates the folly of such advocates attempting to solve economic problems without a full knowledge of the economic structure and evolution of society.

The more we explain the meaning of capital versus labour, in which the capitalists, with their huge capital invested in production and transit, and deriving therefrom a surplus-value far in excess of the wages earned by the workers, have every possible advantage when it comes to a real, deadly struggle, the more will co-operatives realise that whilst the movement may live for a time, by itself, it cannot hope to lift the people into economic salvation, but must simply act as a stand-by until the workers, by political action, seize hold of all land and capital and use these for social production and social distribution.