Democratic wealth and building up the institutions of the left

Co-ops, mutuals, movement building and how to avoid Pasokification of Britain's left - James Doran attended a discussion hosted by Policy Network about the instutitutions of the left and what we can learn from the USA.

James Doran
15 October 2013
West Harris.jpg

West Harris - owned by one of the UK's biggest community land trusts

Last week, at the headquarters of the Policy Network, an interactive round-table debate was held in partnership with the journal Renewal – part of a series of debates on the problems facing social democratic politics. The subject was “Building-up new institutional power bases in the age of austerity: Lessons from the United States” and the event was chaired by Roger Liddle, a Labour peer and frontbench spokesman on Europe and Business, Innovation and Skills, who is the chair of Policy Network.

Build it now!”

Joe Guinan, senior fellow at the Democracy Collaborative at the University of Maryland, opened the debate by sharing the experiences of US “community wealth” initiatives – from social enterprises and community land trusts to co-operatives and employee-owned firms. These projects, by existing community groups and trades unions, are usually aimed at addressing specific problems facing towns and cities, but they are challenging the trends of de-industrialisation and urban decline by democratising and localising capital. Many of these projects have been launched in the wake of the economic crises which began five years ago, and in response to the decline in revenues experienced by municipalities.

The Democracy Collaborative has researched community wealth projects for over ten years, led by Gar Alperovitz – whose book What Then Must We Do? is a practical guide to the new economic movement in America. That the world's most powerful capitalist state has a powerful movement for economic democracy may come as a surprise. But in the course of the Great Recession, Americans - like Europeans – have become enamoured with alternatives which are practically, if not rhetorically, opposed to the interests of the ruling class.

Joe related these experiences to the situation faced by European social democratic parties. Bereft of an independent economic programme, their offer to electorates is slower, softer austerity cuts. I think this is effectively to declare “be killed by us or murdered by conservatives”.

The adoption of policies which are aimed at ameliorating the impact of austerity through institutional creation is not risk-free, however: attacks can be launched from existing institutional power bases. Consider the recent policy announcement by the leader of the Labour Party, Ed Miliband, to freeze energy prices – and the hysterical response from the Big Six energy companies; consider two the Labour leader's position on media reform, and the Daily Mail's smear job on his father, the late Ralph Miliband.

Co-operation or co-optation?

Karin Christiansen, the general secretary of the Co-operative Party, gave a considered response, rich in technical detail. The Co-operative Party is uniquely placed to share the lessons of US community wealth-building, having a record number of parliamentary representatives and a network of “co-operative councils” – Labour authorities committed to putting democratic principles into public service reform.

How much of this is offensive rather than a defensive response to austerity remains to be seen. The risk remains that the agenda of public service reform (code for cuts, privatisations, and job losses) gets through, and the agenda of private sector reform gets lost. Though I've been a member of the Co-operative Party for a number of years, I've always had the suspicion that its success in recent years has been because it is as means by which would-be candidates with weak or no union links can get on in selection processes.

Certainly, in my experience of the Labour leadership hustings events in 2010, the most prominent Co-operative Party MP, Ed Balls, did not put cooperativism at the heart of economic strategy. Indeed, he was recently asked if he was a socialist, to which he proudly admitted, only to state that this should not be seen as advocacy of an economic programme. Managing capitalism it is, then. Which will be obvious from the ditching of “too far, too fast” line and the quiet acceptance of Tory borrowing plans for the next parliament – the kind of move that might have been palatable for New Labour in the context of a global economic boom after 1997, but could mean secessions from One Nation Labour by union affiliates crushed under the weight of cuts.

Co-operation as code

The problem which exists is one of understanding political philosophies and the different uses to which the same words are put. So, for example, the Labour leader's repeated references to a “responsible capitalism” or a “capitalism which works for working people” – clearly this must be a reference to a markets rather than capital itself, as you cannot put capital to work for people who do not own it.

Will Davies, assistant professor at the Centre for Interdisciplinary Methodologies, Warwick, raised an interesting question about the absence of a legal equivalent to social entrepreneurship. Why is there not a category of “social lawyers”? Will made it clear that this was not yet a developed area of his thought – at present, it is a blogpost, one which I urge you to read.

The mention of legal forms influencing outcomes reminded me of comments by Dave Boyle at a recent conference held by Ethical Consumer magazine, Co-operative Alternatives to Capitalism. Co-operatives UK, the trade association, is working on a form of co-operative which could be administered online. Boyle's lively and amusing speech is available online here, and I'd urge you to listen to it, as it gives a critical reflection on the progress of the British co-operative movement with constructive proposals for reform through the use of “liquid democracy” software.

Money for nothing

Stuart White, director of the Public Policy Unit and lecturer in politics at Jesus College, Oxford, responded with thoughts on the intellectual underpinnings of citizen ownership: tracing the history of asset-based welfare policies in British politics, from the economist James Meade's exposition of “property-owning democracy” in his 1964 book, Efficiency, Equality and the Ownership of Property, to the high-points of adoption by the Social Democratic Party and Liberal Democrats.

In the course of the 1990s, the idea of a “citizens' trust” which would accumulate shares in firms and pay a “social dividend” to each citizen remained a commitment of the Liberal Democrats, and there was the implementation of the modest child trust fund policy by the New Labour government (subsequently abolished by the Conservative / Liberal Democrat coalition) which endowed each newborn child with a stake to which parents could add.

Roger Liddle mentioned that Meade, like himself, was involved in the split from Labour – the Social Democratic Party. I think it's worth noting that the demands for property-owning democracy (not to be confused with Thatcher's term for privatisation) had force not because they came from academics alone, but because the 1970s was the high-point of organised labour mobilisation in the UK, with a strong shop-stewards movement of lay trade unionists, eager for greater economic democracy in the face of a prolonged investment strike by capital.

The SDP was a response to this, but very much a reaction against organised labour and the new generation of activist workers – by parliamentarians, councillors, and would-be politicians, whose backgrounds were in the management of a capitalist economy, rather than the generation of its wealth through their labour. Indeed, the breaking point for the Social Democrats in the Labour Party was the adoption of constitutional reforms which gave a say to local party members over the selection of parliamentary candidates – this proved to be the only effective means to ensure that manifesto commitments (for greater public ownership, industrial democracy, and against European integration on a capitalist basis) would actually be implemented by Labour governments.

Moderately stupid

The elites won out in the end: New Labour was the SDP reheated, after all. When a split Labour party lost elections, moderates could argue with the collapse of the only existing alternatives to capitalism that democratic socialism was good in principle but should not be preached or practiced.

What of those who hanker after a return to the settlement between organised labour and organised capital which allowed a social democratic government to tax and spend during the late 1990s and 2000s? I have a term for them: #BlairiteFuckwits. People ask me why I would use this rather fruity phrase – is it not, well, a bit rude? No, because the people I'm referring to are both Blairites and fuckwits. It's not without careful consideration. Those who want to resurrect New Labour are commonly known as Blairites, and people who think that the model of winning elections and governing which worked in a boom will work in a slump are surely guilty of serious fuckwittery. They appear oblivious to the threat of Pasokification – the trend for social democratic parties across Western Europe to be rejected by voters after implementing austerity cuts, resulting in the return to power of conservatives and the strengthening of radical anti-capitalist parties.

Even a return to the policies pursued by New Labour would require the re-mobilisation of organised labour. And that would mean embracing the kinds of industrial militancy which may not be necessary in polite society but which mean the difference between poverty pay and a living wage. Stuart White and Martin O'Neil have pointed to the New Labour that could have been, but this lacks agency – as I have said, property-owning democracy was only seriously discussed within mainstream political parties because people outside of elite circles knew, to speak plainly again, shit was fucked up and were fucking shit up in response.

For all the talk of economic democracy, there was no mention of the dictators at the Policy Network – the fat cats (shareholders) and top dogs (executives) – who will oppose change just as fiercely as they have in the past. Nor was there consideration of who will provide the resources for the formation of what Martin Wood has referred to as “collective agency”, the ability of individuals to engage in critical reflection of their situation and take action to alter their shared circumstances.

Burning down the house

In his article “Burn up not out”, Aaron Peters argues that we can learn from the shift in the US from the socially conservative positioning of Bush to the cultural pluralism of Obama. This is obviously not about imitating the US Democratic Party, but emulating the work which nurtured a social movement base. The recommendations Aaron makes for the UK labour and social movements are:

1) Fund-raising: “an organisation, where community, media and mutual aid groups can raise money. If done effectively there is no reason why this would not take a great deal of charitable donations currently being advanced to frequently ineffective and sclerotic social movement organisations and third sector actors. For the anti-capitalist and union movements to not have a disintermediated funding network limits our ability to have sufficiently well-resourced organisations. This would be a relatively low-cost effort which would require several full time staff at most. If done effectively it would change the landscape for potentially thousands of organisations seeking to fight austerity, neo-liberalism, capitalism and authoritarianism(s).” Example: ActBlue.

2) Leadership and Building Skills: “where large numbers of people come together to discuss and learn about community organising and how to use specific tools”. Example: New Organizing Institute. I'd argue that, given sufficient pressure from below and resources from above, something like the NOI could be established out of the work the People's Assemblies are doing in bringing people together from trades unions and community groups. Some trade unions realise that the organising approach is the only sustainable path – for example, Unite's community membership scheme.

3) Social Events: “where people could get to know one another offline, where ‘newbies’ could discuss politics with others outside of formally hierarchical settings, where people could have fun, and where thin ties that characterise social networks built up over digital fora become thick ones. [...] Again, given the low costs of creating this kind of online space – which might only require 2-3 full and part-time staff – such an organisation commends itself.” Example: Drinking Liberally.

4) Independent Communication Channels: “organisations that seek to combine the best of the old and the new; creating quality, user-led content that receives high levels of feedback and co-creation from viewers/ listeners [...] Media hubs that created television, written and audio content and that could, during heightened episodes of contention, provide information and feedback to movements as well as extending their grievances and solutions to the wider population, would be of major practical benefit.” Examples include Project Syndicate and The Stream.

The efforts would provide the ability for what Andre Gorz termed “non-reformist reforms” to be articulated as long-term goals. In his book Envisioning Real Utopias, Erik Olin Wright puts forward four examples of activity which go beyond electoral and trade union campaigning: experiments in participatory budgeting in local government, cultivation of the digital commons, construction of federated worker co-operatives, and agitation for the right to an unconditional basic income.

Grassroots out of crisis

Joe's talk on the US experiences of building community wealth through a variety of organisational models underlined the importance of social movement unionism – organised labour working with organised communities to effect change. Can we imagine Unite working with the Mondragon Corporation (or even the Co-operative Group) to establish a wave of “union co-ops” in the UK in the same way as the United Steelworkers' union in the US and Canada?

Given the traditional responses to crises of the capitalists' system (working through their states, striking against their institutions) may not be sufficient, I think the People's Assembly movement – albeit focused on protesting austerity – could be a place for the debates and projects initiated by Occupy, and before that the alter-globalisation movement, to develop.

I felt it was worthwhile repeating something I have said elsewhere: the long-term future for the trades union movement lies not in the “new realism” of the 1980s and 1990s, in which union leaders pursued a policy of managed decline through a shift to a service model, but in the organising model of social movement trades unionism.

Social democracy, if it has a future, will have to go back to its roots as a highly contentious movement.

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