Why the Solidary Economy Should Be Taken Seriously

8 Apr

From Jose Itzigsohn, Brown University professor (the sociology department) suggests that the solidary economy should be reconsidered as an important strategy for the world of work.

The Left and the World of Work

The left has had two positions towards work. The first was the emancipatory vision articulated by the young Marx. He saw work as the creative element in human beings and work for society, as the end of human emancipation. Incidentally, Keynes also articulated a vision of the influence of technology in reducing the burden of work and allowing people more time to spend on other areas of life (1930). A precondition for these visions was the development of technologies that would reduce the time that people needed to spend at work and that would make thereby making it possible for workers to exercise their creative powers at work. Of course, under the contemporary form of neoliberal globalization, the benefits of highly productive, labor-saving technologies are appropriated by a small minority of people while for most, the effect is in producing a large mass of surplus labor that keeps the rising cost of wage labor.

The second historical vision of the left has been a pragmatic one, consisting of improving the conditions of workers through union negotiations and labor regulations. This was the concrete politics of the left in the twentieth century and the goal of social democrats in the developed north, developmentalists in the global south and communists in the former east. Western European Social Democrats were the most successful in pursuing this strategy, particularly in the 30 years of growth that followed World War II. Contemporary neoliberal globalization and the emergence of new labor-saving technologies, however, have tilted the balance of power in favor of capital and against labor, undermining the socioeconomic basis that made this political project feasible. Under these conditions, the number of people employed in protected formal work is reduced and the working conditions of this sector are threatened (although it should be noted that the consequences of the new global economic order have varied considerably by region, particularly in the global south).
In some parts of the global north, [neoliberal] developments have inspired theories of the end of work. From the point of view of the global south, these theories cannot but generate some perplexity, as it is obvious that under capitalism, people cannot reproduce themselves without working. What is on the decline in the global north is well paid, protected employment. This by no means equals the end of work. Instead, we are seeing the rise of precarious, unstable, and informal work. That is, we are seeing a convergence—with a lot of caveats—between the conditions of employment in the global north and the global south.

These trends are, on the one hand, unique to the contemporary period, but they are also part of the structural characteristics of capitalism. As José Nun pointed out, capitalism tends to historically produce a marginal mass of unemployable people (2000). Nun developed this idea from Marx’s concept of relative surplus population. He argues that Marxists have identified this concept with that of the reserve army of labor, that is, a segment of the population that is not employed but that can be incorporated in the production process at moments of increased demand. Nun agrees that this can be the case in parts of the world at specific historical moments, but he adds that capitalism also regularly creates a large population that is not employable and therefore not part of the process of capital accumulation. He calls this unemployed and unemployable population the ‘marginal mass.’

The social reproduction of the marginal mass takes different forms: through welfare or unemployment programs, where applicable, or through informal or illegal economic activities, where there is no state support for the social reproduction of those excluded from the labor market. The size of the marginal mass varies historically and also geographically, depending on the particular conditions of capitalist accumulation in specific regions and times, but it is always a structural component of capitalism as a global system. Nun emphasizes that the marginal mass is not functional to the process of capital accumulation and can, at times, be severely dysfunctional to that process.

The presence of a structural, though historically and geographically changing marginal mass should force the left to rethink its strategy and vision towards work. The politics of protecting formal work should be still pursued in those areas of the global economy where the demand for labor is rising and there are shortages in the labor supply. These politics should also be sharply defended in those parts of the global economy where workers have achieved good working conditions. But the left needs to develop a politics for the structural marginal mass, and one way to do so is through the promotion of the solidary economy.

The solidary economy includes economic organizations such as cooperatives, associations of small producers, local or regional economies characterized by degrees of cooperation between businesses, local money initiatives, community initiatives for the delivery of services, and the like. In general, the solidary economy is characterized by economic units owned by their workers (or small businesses), where the goal is the reproduction of life rather than the accumulation of capital (Singer 2011). Solidary economies often emerge as defensive reactions of people excluded from the labor market, but they can also become engines of growth for localities or regions. The development of such an economy can achieve important goals of the left:

a. Solidary economic activities create employment, offering options to people who are not incorporated into the formal circuits of accumulation or reintegrating into economic life people who have been displaced by the “creative destruction” of the market;
b. Solidary economic activities can consolidate the social life of localities and regions. As solidary economic units do not leave in search of higher profits, they can be the anchor of stable communities;
c. Solidary economic activities can also operate as economic stabilizers. Since solidary economic units do not fire people in times of economic downturns, they can sustain economic demand at the local level. If the solidary economy is large enough, it can have a stabilizer effect at the national level on Keynes’ aggregate demand.

To be sure, the solidary economy operates within the market economy and its economic units have to be competitive in the markets they operate. But the criteria of competitiveness of solidary economic organizations are different from those of corporations. While they have to generate enough income to secure a good life for their workers/owners, they do not have to produce profits or dividends for shareholders. Furthermore, solidary economic activities have cost structures that allow them to weather crises better that traditional capitalist businesses as they do not have to pay ridiculously large salaries to their managers.

Left governments can support this type of activity in many ways: by providing assistance in forming and developing this type of enterprise, by creating easy lines of credit for them, by providing tax breaks for this type of business, by contracting to acquire goods or services from solidary enterprises, and by making it easy for workers to appropriate bankrupt enterprises. Perhaps left governments can develop targets for the development of the solidary economy. To be sure, this type of activity can also lose its distinctive characteristics. Anybody familiar with cooperatives, for example, knows that there is a potential for oligarchization. Left governments can address these potential problems by establishing regulations that guarantee that solidary economic enterprises retain their character. For example, there could be regulations that forbid the selling of all or parts of solidary economic units, or special taxes obligating the economic solidary units to contribute to their communities. The details of support and regulation policies are important but they are beyond the scope of this paper. They would also need to be worked out at the local level.
To conclude, the idea of building an economy based on a logic of solidarity rather than a logic of capital accumulation is not new to the left. It has been part of the program of utopian socialists, anarchists, left populists, and communitarians. The state-centered left—in its social democratic, communist, or developmentalist forms—has always had a place for cooperatives in their visions, but they have been a rather marginal component of their policies. To be sure, I am not suggesting abandoning the strategy of promoting protected work and welfare policies. That strategy should certainly be pursued and defended by the left, particularly in those regions of the world economy where structural conditions make it feasible; but that strategy has always left out those who were not incorporated into the circuits of capital accumulation—the marginal mass. For that reason it should be complemented by a strategy of promoting the solidary economy. As argued above, that strategy can help achieve several of the pragmatic goals of the left. It can also help promote the emancipatory vision of the left by creating less alienating work and by promoting an economy that brings together producers and communities.

Keynes, John Maynard. 1930. “Economic Possibilities for Our Grandchildren.”
Marx, Karl. Economic and Philosophical Manuscripts of 1844.
Nun, José. 2000. “The End of Work and the Marginal Mass Thesis.” Latin American Perspectives, 27(1):6-32.
Singer, Paul. 2007. “The Recent Rebirth of the Solidary Economy in Brazil.” Pp 3-43 in Boaventura de Sousa Santos (ed.), Another Production is Possible, Verso.

Author webpage: http://www.brown.edu/Departments/Sociology/faculty/jitzigsohn/

2 Responses to “Why the Solidary Economy Should Be Taken Seriously”

  1. codrin April 9, 2012 at 08:01 #

    foarte interesant articolul!

  2. sebastian raul pavel April 11, 2012 at 07:52 #

    Reblogged this on Journal de Salavin.

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