ourEconomy: Opinion

The ‘free market’ is a collection of dictatorships. Here’s how we create a genuinely free economy

Workplace democracy can help create an economy of values. But how can we move it forward?

Dylan Paauwe
13 February 2020, 1.09pm
Image: freemarketmyass, CC by 2.0

If you ask those on the left, something needs to change but nothing will. Ask those on the right, everything is changing and we can only hope to adapt.

Whether climate change or (have you already forgotten?) austerity, underlying both positions is a great sense of powerlessness in the face of ‘the economy.’ But there is an alternative which is neither pipe dream nor utopian theory. It enables us to go beyond mere value extraction and work according to values like solidarity and sustainability. This alternative is workplace democracy, creating an actually free market and making an economy of values possible.

The current so-called ‘free’ market is a collection of dictatorships. Big or small, benevolent or often otherwise, a handful of people decide how and to what end we spend most of the energy we have. Small entrepreneurs are often considered the hardworking backbone of our economies, and not without cause. And individuals in the upper echelons of the corporate world can (try to) do a lot of good. But overall our economies are run in the narrow and often short-term financial interest of large shareholders who regularly own parts of multiple, even ‘competing’ companies. People who are far from the work being done and its impact make all the important decisions. Meanwhile, we have little to no control over our work and what it produces. We feel something needs to change but that nothing will. Or that everything is constantly changing around us, and we can only hope to adapt.

Thankfully, not all is quiet on the economic front. Currently, there are over 11 million people working worldwide in democratic companies. Whether founded as worker cooperatives, handed over by the original owner or the result of years of conflict between an organized workforce and large corporations, they have one thing in common: those that keep the company running decide how and to what end it is done. Through general assemblies and/or elections of company leaders, they are able to introduce other values into our economy than mere value extraction. Whether supporting free healthcare and education through environmentally friendly production, fighting for gender equality one ecologically farmed bag of coffee at a time, or reinvigorating local and sustainable agriculture, the track record is already impressive.

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But how to move forward? As a start, of course, more of what has gotten us this far. Founding more ‘free companies,’ handing over more to and seizing more as workers. Not being born with it, workers generally lack sufficient capital to start or expand their companies. Special funds could be created for this by existing workplace democracies and sympathizers. And of course crowdfunding is always an option. Current owners could be encouraged and explained how to hand over their businesses to their workers, And importantly, we need (if necessary to start) independent, grassroots workers organizations eventually capable of winning the fight over businesses. Especially when it comes to large multinational corporations, it is hard to imagine any other way.

In addition, existing free companies could link up and combine forces where possible. Whole supply chains, stretching from raw material to the customer, could be liberated. In this way, we can start replacing the current economy with something better. An important challenge is how to simultaneously keep products and services affordable, while providing ourselves with decent wages. As the free economy grows and becomes more interconnected, this will likely become easier because of economies of scale. Another advantage is the model itself: because we do not have to give a substantial part of the value we produce to people who do not actually do any work (e.g. large outside shareholders), we can simply pocket this. Or of course reinvest, lower prices and/or support other initiatives which benefit people and the environment.

For this reason, we need strong social movements. Workplace democracies are likely to tend to move against narrow self-interest among workers. At the very least workers will need to negotiate with colleagues and they will tend to be from the same or adjacent communities where the business is located and which it services. But it is also naive to think that will be enough. For those who have not been around us much: workers are people too. We need strong social movements to connect different workplaces, instill values and keep them alive. Because while real economic freedom can make a better world possible, only people can make it happen.

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