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Wed May 27, 2015, 08:23 AM

Richard Wolff: Critics of Capitalism Must Include Its Definition


from truthout:


by Richard Wolff


Most business leaders, mass media, politicians and academics keep defining capitalism, the main economic system in today's world, as markets plus private ("free" enterprises. That definition is wrong. Definitions matter more now than ever as people increasingly question, challenge and want to move beyond capitalism.

Consider the 20th century revolutions that overthrew a capitalism they defined as markets plus free enterprises. In Russia and China, they replaced private, free enterprises with socialized (state-owned-and-operated) enterprises and replaced market mechanisms of distribution with central state-planned distribution. They called that "socialism," thinking they had abolished and gone beyond capitalism. However, their socialism proved unable to sustain itself and mostly reverted back to capitalism.

One reason those revolutions failed to go beyond capitalism was those revolutionaries' definition of capitalism and socialism. That definition crucially shaped their strategies for and very conceptions of revolutionary social change. Since that definition still shapes debates over and strategies for social change today, it urgently needs to be criticized and set aside.

Because capitalism is so regularly defined as "a market system," we may consider first the actual nonequivalence of capitalism and markets. Capitalism became the dominant economic system in England in revolt against feudalism there in the 17th century. Capitalism spread from England to the western European mainland and thereafter to the rest of the world. However, capitalism was neither the first nor the only system to utilize markets as its means of distributing resources and products. In the slave economic systems that prevailed in various times and places across human history, markets were often the means of distributing resources (including slaves themselves) and the products of slaves' labor. In the pre-Civil War United States, for example, masters sold slaves and cotton produced by slaves in markets. Thus, the presence of a "market system" does not distinguish capitalism from a slave system. ......................(more)

http://www.truth-out.org/news/item/30678-critics-of-capitalism-must-include-its-definition




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Reply Richard Wolff: Critics of Capitalism Must Include Its Definition (Original post)
marmar May 2015 OP
rogerashton May 2015 #1
PotatoChip May 2015 #3
rogerashton May 2015 #5
PotatoChip May 2015 #6
rogerashton May 2015 #7
LWolf May 2015 #2
rogerashton May 2015 #4
LWolf May 2015 #8
rogerashton May 2015 #9

Response to marmar (Original post)

Wed May 27, 2015, 09:38 AM

1. Good thinking. A few further thoughts, slightly critical.

Putting it in slightly different words, capitalism is a system in which the owners of the nonhuman means of production have the legal right to ownership of the surplus created by joint production. But, following Schumpeter, I would add one other thing: social status within the capitalist class arises from "business success." That means markets DO play an important role, though not (here I agree with Wolff) a defining one: they provide a neutral standard for the evaluation of business success. It follows that "crony capitalism" or plutocratic oligarchy is not capitalism at all. And that is the direction in which we are going.

One other qualification: Worker cooperatives (and for that matter communes) can be very successful when they are chosen by the people who work in them, but when the government herds the workers into cooperatives, the coops fail. Thus, defining a socialist economic system may not be as simple as Wolff would have us believe. But he has a lot right and should be studied carefully.

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Response to rogerashton (Reply #1)

Wed May 27, 2015, 12:05 PM

3. Where in this article, or in any of Wolff's discussions/written work, do you see

him advocating for governments to "herd workers into cooperatives" or WSDEs (Worker Self Directed Enterprises)?

The way I read this article, (along with his other work), is that he (Wolff) advocates organic growth of Coops and WSDEs via the workers who want them, rather than any major government intervention to bring them forth. Indeed, that is the entire point.

Iow, unwanted and unsought government involvement in the establishment, and day to day operations of Coops and WSDEs is the very antithesis of what Wolff is advocating, in the same way a small group of capitalist decision makers would be.
...This is not to say that local, state, and even federal government policies could not assist in establishing an environment in which these worker owned entities thrive; but here again, it would be up to the workers to seek, and agree upon such assistance.

Here is a portion of the article that (I believe) illustrates this:

Confrontation - putting WSDEs forward as a systemic alternative to capitalism - could take may forms. For example, labor unions could add the establishment of worker coops to their strategies vis-à-vis capital. When employers demand concessions by threatening to close enterprises, move them abroad, etc., unions could refuse and proceed instead to establish workers coops if and when the employers actually abandon enterprises. To take another example, localities could campaign for use of eminent domain to address both unemployment and poverty by organizing and supporting worker coops. The successful Mondragon Cooperative Corporation was born in a poor and unemployment-ravaged part of 1950s Spain. High school, college and university curricula could include both abstract discussions on how the US might do better than capitalism and practical courses for establishing worker coops.

Most important would be if progressive political forces saw gains from allying with, helping to build, and undertaking mass political and ideological support for worker coops. The latter could then provide a crucial communication bridge between the left and the daily struggles of workers in their enterprises, both those still capitalist and those that are WSDEs or becoming so. Workers already in WSDEs and those working for transition to WSDEs could also provide economic and political supports to left political initiatives and campaigns. In return, the left could mobilize for legal and other changes to provide worker coops with the needed legislative framework, capital and markets. Mass political campaigns eventually secured the Small Business Administration for small businesses and various levels of political supports for minority and women-owned businesses. WSDEs could benefit from parallel administrations assisting them.


Here is one of Wolff's websites that explains the concept in greater detail: http://www.democracyatwork.info/

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Response to PotatoChip (Reply #3)

Wed May 27, 2015, 12:24 PM

5. Fair enough --

my phrase is hyperbolic -- but here's the thing: if we rely on workers wanting cooperative organization, as we have been doing since the 1840's, then WSDEs will never become the predominant form of enterprise organization. The only way that will happen is by -- the government herding workers into cooperatives. After all, WSDEs have been advocated by socialists since Buchez Mind you, I agree with all the concrete proposals Wolff makes. But worker ownership has some limits which are pretty well documented in the research literature on worker cooperatives in action in the real world. Predominant public ownership, in some form, will be required.

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Response to rogerashton (Reply #5)

Wed May 27, 2015, 02:00 PM

6. I can't access your second link w/out paying $32.00. Not doing it. Sorry.

As to your first link, it was a dry read that I'm sure Richard Wolff could have written in a much more entertaining way.

Nonetheless, for the sake of being polite, I took your detour from the point, and read the thing. While many, even most, of the particulars and details are new to me, I am familiar the basic history, as well as the time frame in which it occurred. That history does not change the fact that American Cooperatives and WSDEs continue to exist and thrive in greater abundance than ever before. Capitalism began in fits and starts in much the same way.

As more and more Americans become disenchanted w/a Capitalist system that is abandoning us for greener pastures in emerging markets, many are casting about for alternatives. We'd be fools not to.

Here is a current, but incomplete list of Coops and WSDEs... Btw the government did not have to "herd" anyone into them.

United States
Agaric, LLC (Natick, MA)
AK Press (Oakland, CA[4])
Alvarado Street Bakery (Petaluma, CA)
Arizmendi Bakery Coöperative (San Francisco Bay Area, CA)
Arizmendi Development and Support Collective (CA)
Artichoke Food Co-operative (Worcester, MA)
At-Hand Apps, LLC (Newton, MA)
Black Bear Bakery (St. Louis, MO)]
Black Coffee Co-op(Seattle, WA)
Boston TechCollective (Somerville, MA)
Brattleboro Tech Collective (Brattleboro, VT[5])
Bread And Roses Food Cooperative (Tallahassee, FL)
Breitenbush Hot Springs (Detroit, OR[6])
C4 Tech & Design (New Orleans, LA[7])
Casa Nueva Restaurant, Cantina & Bodega (Athens, OH[8])
Cheese Board Collective (Berkeley, CA)
Chicago Technology Cooperative (Chicago, IL)
Circle of Life Caregiver Cooperative (Bellingham, WA)
Citybikes Workers' Cooperative (Portland, OR)
Civilization Systems (Baltimore, MD)
Collective Copies (Several locations near Amherst, MA[9])
Community Builders Cooperative (Somerville, MA)
Cooperative Home Care Associates (Bronx, NY), estb. 1985. [10][11] the USA's largest largest worker owned co-op [12]
Co-Soap Cooperative (Oakland, CA)
Data Systems Inc (Burlington, VT)
Design Action Collective (Oakland, CA)
District Sentinel (Washington, DC[13])
Dollars and Sense (Boston, MA[14])
Ecomundo Cleaning (New York, NY)
Electric Embers (San Francisco, CA)
Equal Exchange (West Bridgewater, MA[15])
Evergreen Cooperatives (Cleveland, OH)
Flywheel Tech Collective (Cleveland, OH)
Food for Thought Books (Amherst, MA)
Free Geek (Portland, OR)
GAIA Host Collective
Glut (est. 1969) (Mt Rainier, MD)
Gotham City Drupal (Brooklyn, NY)
Great Sky Solar (Boston, MA)
Green Worker Cooperatives (The Bronx, NY)
Hard Times Café (Minneapolis, MN)
Heartwood Cooperative Woodshop (Berkeley, CA)
Hoedads Reforestation Cooperative (Eugene, OR)
The Hub Bike Co-op (Minneapolis, MN)
Inkworks Press (Berkeley, CA[16])
Isthmus Engineering and Manufacturing (Madison, WI)
Little Grill Collective (Harrisonburg, VA)
Lucy Parsons Center (Boston, MA)[17]
Lusty Lady (Seattle, WA and San Francisco, CA[18])
Mariposa Food Co-op (Philadelphia, PA)
Mintwood Media Collective P.R. Firm [1] (Washington, DC[19])
Nabolom Bakery (Berkeley, CA)
Namaste Solar (Boulder/Denver, CO)
New Era Windows (Chicago, IL)[20]
New Moon Cooperative
Olympia Food Co-op
Other Avenues Food Store
Pedal Express
Pedal People Cooperative (Northampton, MA[21])
Pelham Auto Parts (Belchertown MA[22])
Puget Sound Consumer Co-Op
Pioneer Valley Photovoltaics (Greenfield, MA and New Britain CT[23])
Radical Designs Cooperative (Oakland, CA)
Radical Press Coffee Collective (Gainesville, FL)
Rainbow Grocery Cooperative
Red and Black Cafe (Portland, OR)
Red Emma's Bookstore Coffeehouse (Baltimore, MD[24])
Red Sun Press (Boston, MA)
René Pujol Restaurant Cooperative
Ronin Tech Collective (Brattleboro, VT
Seward Community Cafe (Minneapolis, MN)
Sunshine Propane
Shot In The Dark Cafe (Tucson, AZ)
South Mountain Company
TechCollective
TeamWorks
Toolbox for Education & Social Action (Northampton, MA)
Twin Ports Commonwealth (Twin Ports)[25]
Union Cab of Madison Cooperative
Union Technology Cooperative (Madison, WI)
Valley Green Feast Collective (Northampton, MA)
Web Collective, Inc.
WebSkillet (Burlington, VT)
Woodshanti Cooperative
http://en.wikipedia.org/wiki/List_of_worker_cooperatives#cite_note-14

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Response to PotatoChip (Reply #6)

Wed May 27, 2015, 03:59 PM

7. If you don't want to buy the book, get it through your library.

I can't access your second link w/out paying $32.00. Not doing it. Sorry.


Actually, there is a whole series of books and journals going back to the 70's, on the economics of worker coops in this and many other countries. Thought you might like to know that.

Thanks for the list. I posted a link for an upcoming conference that you might perhaps be interested in somewhere in this thread. Yes, they are thriving, as they were for a while in the 60's-70's. Point is, we still are waiting for worker coops to transform society -- after nearly 200 years. And it will be another 200 -- and still waiting.

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Response to marmar (Original post)

Wed May 27, 2015, 09:48 AM

2. More.

How an economic system organizes the production, appropriation and distribution of its surplus neatly and clearly differentiates capitalism from other systems.


So then how should we define capitalism to differentiate it from alternative economic systems such as slavery, feudalism and a post-capitalist socialism? The answer is "in terms of the organization of the surplus." How an economic system organizes the production, appropriation and distribution of its surplus neatly and clearly differentiates capitalism from other systems.


Capitalism's organization of the surplus differs from both slavery's and feudalism's. The surplus producers in capitalism are neither property (slavery), nor bound by personal relationships (feudal mutual obligations). Instead, the producers in capitalism enter "voluntarily" into contracts with the possessors of material means of production (land and capital). The contracts, usually in money terms, specify 1) how much will be paid by the possessors to buy/employ the producer's labor power, and 2) the conditions of the producers' actual labor processes. The contract's goal is for the producers' labor to add more value during production than the value paid to the producer. That excess of value added by worker over value paid to worker is the capitalist form of the surplus, or surplus value.


While the capitalist, feudal and slave organizations of the surplus differ as described above, they also share one crucial feature. In each system, the individuals who produce surpluses are not identical to the individuals who appropriate and then distribute those surpluses. Each system shares a basic alienation - of producers from their products - located at the core of production. That alienation provokes parallel class struggles: slaves versus masters, serfs versus lords, and workers versus capitalists. Marx used the word "exploitation" to focus analytical attention on what capitalism shared with feudalism and slavery, something that capitalist revolutions against slavery and feudalism never overcame.


So, if I'm looking for a simple definition, it boils down to "exploitation."

The article goes on to point out that the Keynesian vs neo-liberal system debate keeps the focus on the same organization of surplus, and therefore, continued exploitation.

The solution presented in the article is the proliferation of WSDEs: "Workers' Self Directed Enterprises." I think this is an interesting rabbit hole to spend some time in, myself.

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Response to LWolf (Reply #2)

Wed May 27, 2015, 12:11 PM

4. Um, no ---

So, if I'm looking for a simple definition, it boils down to "exploitation."


But, as Wolff observes and you quote, and as Marx held, exploitation is common to all three types -- all prior "historical societies."

If by spending some time in a rabbit hole, you mean participating in or spending time with people who participate in workers' coops, follow this link:

http://east.usworker.coop/

However, I think Marx was right to say that the world will not be transformed by "duodecimo editions of the New Jerusalem."

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Response to rogerashton (Reply #4)

Thu May 28, 2015, 08:54 AM

8. No, what?

Of course the definition isn't simple, as this article points out. But, in an effort to bring it down to one word that differentiates it, I think exploitation works.

Thanks for the link. I'm interested in seeing how coops work in the current climate. The only coop in my region isn't a workers' coop, but a customers'. It's how I get my electricity, and I greatly prefer it to the private, for-profit providers I've had before.

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Response to LWolf (Reply #8)

Thu May 28, 2015, 10:41 AM

9. Things should be made as simple as possible, but no simpler.

Coops, including the REA and consumers' coops, take a little power away from the plutocrats -- sometimes more than a little, as Bernstein pointed out. But plutocratic power is more than proportional to the proportion of capital wealth that they control, and coops can only nibble at that -- however valuable they are in creating some liberated space. No socialism without redistribution of wealth and public ownership. Notice -- in a modern economy ownership and management are separated, for good or ill, so we could have public ownership with decentralized management and control by the workers at the "point of production" -- just to the extent that the workers want and demand it. That is what I support, and I don't think Wolff and I are very far apart on that -- to what extent he would distinguish between what I call public ownership and he calls worker ownership. In practice, all systems are mixed, and a strong mixture of direct worker ownership with public ownership could be a very good mix.

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