You are here

Home

Theory

Theoretical background, frame of reference and general narrative of the Alternative Economy Project

(Rough Draft/Work in progress: input, questions and suggestions are welcome)

The need to develop a coherent and viable alternative to neo liberalism and liberalism

The process of European integration and of formation of a new and sovereign political entity, independent from direct Us influence and endowed with an advanced social/welfare consciousness, charter and tradition, has now been pushed back to a stage well antecedent to Bush’s first election in 2000. The EU/EC has become, as recently passed anti-immigrant legislation shows, a pliable tool in the hands of the European right, i.e., of the American right and of US imperial power and influence in general. There is a growing social awareness in the US as in Europe (even if only subliminal for most, at the moment) that a simple return to a capitalist ‘business as usual’ under ‘Liberal’ administrations is going to give us just more of the same and prepare us for yet another ‘fascist’ take over of political and economic relations. The globally perceived need is to move away from neo liberal criteria, requirements and procedures of maximization, centralization and unequal distribution of profits, power and taxation and towards the optimization of work performance and product quality; optimal standards of living and standards of health, economic, educational and social security; infrastructural supports, new/alternative jobs, at the aggregate local/global (glocal) levels and the achievement of economies of scale. The issues of worker/union participation in the economy, of negotiating changes and conditions of the organization of work and technological innovation, of taking responsibility within the decision making processes of one’s firm as well as of the economy as a whole, are emerging with great force both in the North and the South of the world.

The emergence of racism and ethno phobia in Europe under US imperial, geo-political influence

The problem of displacement on a global scale, of large movements of people from their homelands because of environmental, economic, social and political crises (disasters) and of relative deprivation is not news. Whether forced or free, emigration/immigration has been providing cheap work forces to the Northern (Western) capitalist economies from the word go. One general (historical) question is why the political fortunes of political parties and governments alike seem to ride so well on imposing regulatory solutions that seek to protect the citizenry of host countries at the expense of immigrant workers. I think we know some of those answers already. Chief among them is retaining the ability to keep the price of labor, of welfare benefits and regulatory protections low (as close as possible to zero) for the capitalists and to keep workers at each others’ throats politically. The new question is why the Europe that has kept its protective doors relatively open to immigrants, seemingly without any major concern or regulations for decades after WWII, is now seeking to close those doors also by whipping up ethno phobic, racist hysteria and security fears. As the results of the recent Italian elections show, this type of electoral propaganda seems to work wonders fro right wing politicians if conditions are ripe. To answer correctly we must be careful not to abandon the US as the geo-political center and the historical focus of our attention when it comes to understanding and dealing with racist and ethno phobic political traditions. Indeed whether we consider propaganda techniques, the results of their deployment, or the social and economic impacts of the policies that ensue, they have all happened in the US first. As important as racist and ethno phobic propaganda is in and of itself to electoral outcomes, it is also a mere motivational ruse, mass psychological manipulation, deliberate political action aimed at creating a popular reaction, secondary in both tactical and strategic terms. What is primary is the material/economic campaign that precedes such political efforts and the legislative and economic impacts that follow them. It is not just a coincidence that Bush stuck a triumphal imperial head in Europe recently, in order to bathe in the results of his handy work—a rising tide of right wing, pro-US and pro-war, anti-immigrant, anti-Muslim resurgent power with the blessing of the Catholic Pope. The plummeting value of the dollar relative to the euro, the high interest rates, the lack of investments and employment growth, the stagnating wages, the unstable and insecure jobs, the constantly spiking price of oil, of housing and basic consumer goods, the worker rights that go violated and unenforced, the industrial accidents that proliferate without prevention or intervention, may have one or two—causal—things to do with current European fears and insecurities. Among other potentially positive effects of moving in the direction of building alternative economic/social relations—to the extent that a flourishing alternative glocal economy were to arise and workers, may they be from countries hosting immigrants or immigrants’ countries of origin, became increasingly independent of the capitalist economy (equipped with the knowledge and the resources to provide for themselves economically) -- the reasons for emigration and competition for scarce ‘dependent’ jobs and thus for racism and ethno phobia, would be drastically diminished at inception.

The emerging Peace economy

There is a new and alternative terrain on which individual worker experiences and initiatives and their unions can find opportunities for innovation, comparisons, commonalities, synergies and exchanges. The key here is to conjugate union bargaining power and economic experience with innovative and equitable economic initiatives that seek to evolve in harmony and stewardship with the natural and social environment. This is also the most fertile terrain upon which to build a “peace” and “ethical” economy as a clear alternative to the “war economies” we are now called to operate in and a-morally benefit from. (Among other things in a ‘war economy’ firms are organized and disciplined as if it were an Army Corps and conflict is dealt with and resolved through various forms of repressive violence). Much of this movement towards innovative products, services and systems of production, distribution and financing already exists and thrives on the ground. Italy represents an especially significant case study with an uncommon concentration of innovative aspects: from Nano technology in Emilia Romagna, to bio-degradable plastics in Piedmont, to the BCC’s, MAG’s, Ethical Banks for alternative financing, to the GAS’s, DES’s and OGM free agricultural production for equitable trade, to Eco villages and the entire network of cooperatives in every economic sector across the national territory, the array of experiences and examples worthy of note is indeed large.

Workers’ unions and workers’ cooperatives

There are significant aspects “alternative” to “democratic capitalism” already present in the /standard/work/labor/social package of rights/practices (European Social Model) that can be found in the Italian and European context. This is much less ‘significant’ in the American (also with notable exceptions, Canadian and Latin-American) context. One could start fleshing out some of these in detail. They can be easily pin pointed in the packages of workers’ rights that regulate the relationship between workers and employers but also in the package of social protections and entitlements currently delivered and enforced at the national and European levels together with the enforcement practices associated thereof by the institutions dedicated to such functions. On a parallel track the same could be said about the experience of workers’ cooperatives with an additional focus on their innovative and alternative ‘best practices’. For example: unions like CGIL or the CGT could easily gather and organize this debate/reflection just by utilizing their current organizational networks, levels and capacities on both counts. Faced with the ever destructive consequences of the current “global” system of production and distribution of goods and services—making dynamic gains in knowledge and independence from the “yokes” of capital, management and the state (or in influence over economic policy/strategies) is the new, urgent, universally relevant ‘key aspect’ for human survival and habitation and for the success of an enterprise, a sector, an economy and of any unions involved. At the same time one feels the urgency of the widely shared need to be “positive”, “constructive” and “propositional”, both in the national and global contexts, about figuring out practically how to organize work, create jobs and thus labor representation, through the structural re-organization of the current systems of work and of the sets of social interactions involved in current work processes. The point here is to get individual workers/groups of workers to gain more say/control/responsibility over decision making in their firms or alternatively, to take the initiative in starting up new, more equitable and sustainable economic activities, for example, of the ‘cooperative’, ‘ethical’, ‘ecological’, ‘fair', 'equitable', 'social' and 'solidarity' type. It turns out that historically speaking, we find that within the context of the First International Workingmen’s Association (during the last quarter of the 19th century, i.e., prior to the authoritarian involution that gave rise to the notable and failed examples of naked pursuit of state power for power’s sake) both Socialist and Anarchist groups shared a common vision and a common strategy for workers’ creation and control of economic activities through unions and cooperatives. In France, for example, a deliberate and violent state intervention was eventually needed to separate the two.

The proper economic role of the national State

The recent electoral results in France, Italy, UK confer more of a sense of urgency to move in this direction, in so far as in those countries the national state can (and most probably will) be wielded as a repressive weapon against civil, workers’ and union rights and as a promoter of the corporate economic interests and of the ruling classes alone. This will for sure engender further disastrous and unsustainable political, economic, social and ecological decisions and situations. The modern national state has gone well beyond the powers of legislation and taxation enforced by judicial power through police, armed forces and prisons. In relatively recent times it took on a variety of forms of intervention in the economy. From fiscal/financial incentives and assistance to firms and individuals, towards national systems of health care, education, social insurance and welfare, to actually owning and running national economic sectors like oil, rubber, natural gas, electric power, public transportation, etc. These public functions/firms have been under tremendous neo liberal pressure, as of late, to cut expenditures, work forces and to privatize and outsource, because public ownership and management of economic activities is seen by private economic interests as inefficient, wasteful, monopolistic, non-competitive, unfairly advantaged and an over all burden on the private sector. The failures of the Chinese, Russian and Eastern European economic “realized socialism” experiments have much to teach us in regard to the downside of “political” management of public economic firms. The Italian or the French historical experiences of massive state participation/ownership in the economy do not appear to have fared much better but the neoliberal “privatization”, “outsourcing” and “lay off” recipes have proven to be no panacea to public economic ills either. And of course the modern national state has proved to be totally ineffective against the basic drives of globalization. Firms are free to pick up their capital investments and move them to countries where the absence of effective legal protections and social guarantees for the workers and the natural environment undercut century old histories of union/social progress in their countries of origin. Even within each of these countries new, informal, unregulated sectors of the economy are allowed to operate and flourish seemingly unchecked. Yet, western right-wingers, whether of statist or neo-liberal persuasion, keep on mounting successful after successful conquest of national parliamentary majorities and top executive offices. After everything is said and done, it is abundantly clear to them that the political and economic elites they vie to represent, are much better served by having at one’s disposal the blank check of the state budget covered by their nations’ fiscal resources and ability to borrow in some cases even beyond 100% of GDP. On the other hand Liberal and various shade of left politicians, get elected into state office with the full awareness they will find themselves constrained and accountable to the same political and economic elites and punctually fail to deliver the reforms they promise during electoral campaigns.

National State or Federation of producers?

It is indeed a foregone conclusion to the minds of responsible economic actors that managing an economic initiative whether through patronage, allegiance to political bosses/factions or patronage, allegiance to corporate bosses/factions are both sure ways to ineffectiveness, inefficiency, financial scams, abuses of power, corruption, waste of precious public resources, deskilling, incompetence, lack of productivity and ultimate failure, not just in public agencies but in privatized, out-sourced and sub-contracted ones as well. Therefore the third leg of the alternative social/economic stool is by necessity and by default what can be defined as the macro, federative, aggregate and global economic scale of alternative economic activities and movements. Here it is of fundamental importance to involve public and semi-public employees/unions in the policy discourse on how to re-dimension the role of the state, of public agencies in ways that are functional to increased optimal levels of social and economic security of individual workers. It is also timely and opportune for labor unions, public employees and alternative economic forces in general, to start a debate/dialogue in order redefine the economic role of the state understood more in terms of its social and economic assistance functions, as a territorial federation of associations of producers, similar to the way Italian/Continental European Unions are currently organized. One could seek to maximize synergies between these various streams of experience in order to confer to each the best practices and advantages of the other. Several of these synergies/discourses may give rise or already carry within them the DNA/staying power functional to envision a post-capitalist economy. One would hope that out of this type of effort will emerge new capacities to involve and assist individual workers at the rank & file level, whether employed in a private firm, in a workers’ cooperative or self-employed, to devise and utilize tools that will enable them to engage in processes of critical reflection on their economic niches, the organization of their work, on the levels of knowledge and technology required for economic success and sustainability, on reliable and transparent administrative structures and in order to come up with ways of working and operating that are holistic, sustainable, horizontal, cooperative, mutually supportive, smart and innovative.

Conjoining Crises

Draft document of the European Cross Networking-WSF preparatory Meeting on the Global Crisis to be held in Paris on 10 and 11 January, 2009.

The financial crisis now affects the «real economy». The United States and most of the members of the European Union have entered into recession, unemployment has increased and emerging countries have started to be hit. Without a doubt, the poor countries in Africa, Asia and Latin America will be violently affected and the most fragile, in the North as well as in the South, might fall into extreme poverty of a kind unbearable to human beings.

This crisis is not only the result of the cynical behavior of a small number of financial operators. The 'financiarization' of the economy finds its origin in a continual decrease of the share of the producted wealth granted to wage earners: ten points in 25 years in the OECD countries. The boom of financial profits gained by corporations and of dividends payed to shareholders, while investments were slacking due to lack of solvent demand, created the conditions for the financiarization of the economy.

Deregulation of financial markets, complete freedom of capital movements and the growth of the number of tax havens, are at the origin of the crisis. With the absence of real public controls, banking marketing practices bordering on hoaxes and the implementation of financial techniques that target maximum profitability in the shortest possible time, have hastened the current crisis.

The political liability for this state of affairs lies simultaneously with financial institutions and the national governments which encouraged the financiarization of their economies. This crisis is getting connected with other crisis that were pre-existing. The social, ecological and food crisis are now combining with the financial one to mark the contours of a fully fledged systemic and global crisis.

Governments have gone about shoring up such breaches in the economy by socializing the losses of private banks. Trillions of public dollars have been poured into this attempt worldwide and without any major political hurdle or condition. At the same time, the positions of the very same governments are on record as holding that it was supposedly impossible to fulfill the social needs of ordinary people because of lack of public resources and while public development aid for southern countries went drastically reduced.

Even worse, the current crisis doesn't protect from attacks against social rights: the European Central Bank advocates a freeze on wages and the General Council of Economic and Financial Affairs pushes for an increased flexibility of labour and to hold on to the criteria of the Stability Pact. The economic recovery plan developed by the EU, which isn't more than the simple addition of the various national plans, will unlikely address the gravity of the situation. The first meeting of the G20 hasn't led to any concrete measure at the global scale, and those countries' governments haven't showed any real willingness for a deep shift toward a new economic course.

Economic and political choices must be opened to a real democratic debate. Citizens must be able to exert their right to participate in the decision making process at all levels. They must not be asked to pay for a crisis that is not of their own making. It is now necessary to assert measures which will end the domination of market-oriented finance on the economy, and measures of social emergency, which will shield ordinary people from the effects of this crisis. More to the point, we have to build a new economy based on real distribution of the produced wealth, centered on the fulfillment of social needs, the lasting reduction of inequalities and a long-term response to the ecological imperatives.

In the very short term, it is crucial to hold out against official views and political choices which keep on legitimating the deregulation and financiarization of the economy. It is also urgent to engage, in Europe and with our colleagues worldwide, in the joint work of formulating the alternatives that we will assert vis-a-vis the EU and the G20 governments.

Links to several preparatory documents produced by different European groups: European Attac Network:"The Time has come. Lets shut down the financial casino." http://www.networkideas.org/featart/oct2008/ATTAC.pdf

BankTrack Network: On the role and responsibilities of the private banks in the current crisis http://www.banktrack.org/manage/ems_files/download/bank_to_the_future_el...

CRBM: "short guide to understand the financial crisis" http://osservatorio.webhat.it/italian/inchieste.phpidnews=588&start=0

Eurodad, CBRM, WEED, Bretton Woods Project: Addressing development´s black hole: regulating capital flight. http://www.taxjustice.net/cms/upload/pdf/Eurodad-WEED-CRBM-BWP_Capital_F...

SOMO/Myriam van der Stichele: "Strategic mapping of EU influence on global financial regulation" http://www.eurodad.org/uploadedfiles/whats_new/reports/eumapping_financi...

Tax Justice Network website (http://www.taxjustice.net)

Cross Networking

Towards Alternatives and Strategies for Change!
(Global Crises Leaflet)

A substantial number of global and regional civil society networks and social movements are inviting during the World Social Forum in Belem/Brazil to two Cross Networking spaces to discuss Alternatives and joint strategies for change. These two spaces are working spaces that are open to interested networks and social movements and are considered a starting point to explore themes and strategies across networks that help to build synergies to face the global crises.

Please find below a brief description of these two spaces, its co-organisers and the proposed methodology of these spaces.

Global Crises: Cross Network Space to Discuss Alternatives 30 of January 2009,

A cross network space to develop to share and develop joint alternatives and demands of social movements as a response to the global crises: food, climate, finance, labor/social, water, etc.

Global Crises: Cross Network Space to Discuss Joint Strategies 30 of January 2009,

A cross network space to share strategies of mobilization towards change. Networks will share their proposals developed in their own networks, including moments of actions for 2009 – 2010. Based on these reports we will explore synergies and ideas on how to continue to work together across various networks.

Co-organisers of the Cross Networking Spaces

Our World Is Not For Sale (OWINFS), TUCA - Trade Union Confederation of the Americas, Seattle to Brussels network, European Attac Network, Bi-regional Network Europe-Latin America and the Caribbean/ Enlazando Alternativas, European Network for Public Services, Social Watch, CADTM, Jubilee South, Hemispheric Social Alliance, Labor and Globalization Network, Action Aid International, International Gender and Trade Network (IGTN), Friends of the Earth International, Transform! Europe Network, LATINDAD, World Council of Churches, Transnational Institute, EURODAD, Poor People\\\\\\\'s Economic Human Rights Campaign – PPEHRC, REBRIP, Brazil Network on Multilateral Financial Institutions, Institute for Agriculture and Trade Policy, Focus on the Global South, SdL Intercategoriale, War on Want, Global Economic Alternatives Network

Methodology for the two spaces

The two spaces are thought to be working spaces to build synergies among a broad range of global and regional networks and movements. We invite networks, movements and groups who work in convergence spaces on key dimensions of the crises (financial system, food, energy, climate, labor/social, water etc.) to report from their own discussions. In order to allow for the building of convergences, we propose that networks and movements try to present – if possible

- The main demands/proposals/alternatives they consider key to face the global crisis (for the cross-networking space on alternatives) and

- The main strategies to advance alternatives and to build a strategy of change (for the cross-networking space on strategies). Those proposals should not only include proposals for days of action and demonstrations, but also strategies to build a long term movement for change.

Acknowledging the diversity of networks and movements, some of which are more recent than others, those who consider it to early in their process to be able to present focused proposals shall briefly report about the main conclusions as regards alternatives and strategies in this space.

In order to make the space a working space, it is planned to first have brief presentations of different networks and movements which work on key dimensions of the crises (finance, food, climate/environment, energy, labor, water etc.). In a second step discussions based on the presented proposals in smaller groups should take place with a final sharing of results in plenary.

The results of the discussions shall be put together in a brief document to be used by movements and networks in their further work, post Belem.

Proposal for a brief Statement to give visibility to this process

Those networks and movements which have engaged in the preparation of these two spaces propose that a very short statement should be prepared during the two spaces, to give visibility to this effort of building collaboration and cooperation among different global and regional networks and movements towards building alternatives and strategies for change and possible next steps. This short statement shall be worked out in a working space, by a small number of persons willing to prepare it, during the meeting, and if there will be consensu on it, it will be presented to the assemblies on the final day of the WSF.

For further information
Karen Lang, OWINFS – Tel.
Alexandra Strickner, IATP/OWINFS – astrickner@iatp.org