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Libertarian Socialist

Noam Chomsky in several of his works calls a proposed new economic and social order Libertarian Socialist. Here is my interpretation of that model in light of other topics in this web site, such as Public Accountability.

Libertarianism is the political philosophy advocating strict limits to government activity with the goal of maximizing individual liberty and political freedom. Each government agency is charged with monitoring and controlling some human activity, and sometimes the entity is also authorized for some means of enforcement (such as beginning legal prosecution or defining a financial penalty). There are two major problems that can be encountered: 1) the agency might be inefficient, defining rules and regulations that do more harm than good because those defining the rules are just playing their role, not truly understanding the economic process and the real consequences of those rules, and 2) the agency might be too aggressive, with its leadership falling to the temptation that more control is better, although this is sometimes (often) a result of the agency continually seeking more responsibility (more power to control!) and funding (either higher wages & bonuses or more staff).

Our American representative democracy has become a farce. With the recent Supreme Court ruling on Citizens United vs FEC, elections are now officially open to the highest bidder whereas before special interests had to be more careful on how they paid for their representatives. The government agencies now execute policies intended to help corporate interests, not the interests of the American electorate, so those policies are more likely to be harmful than beneficial to the American people. Therefore the government itself becomes a major impediment toward social justice.

Socialism is the economic system where the means of production are commonly owned and controlled cooperatively. This is the primary alternative economic system to capitalism, having private ownership of the means of production, with profit serving as the motivation for the creation of the goods and services and with competition serving as the means for setting their prices and for setting the wage scales for the laborers. The main problem with capitalism is its being based on greed. The human community allows the owner of the economic entity to pursue his/her production of goods and services that should benefit the community while not harming the community. This level of 'unacceptable harm' is unfortunately set by some government entity established to monitor the economic organizations.

A slave plantation is an example of what can happen with capitalism. To maximize the profits, the owner determines that lowering labor costs is quite effective. Those costs can be lowered as far as the local government will allow and as far as laborers can still be found. Since slaves were considered property and not human beings, the atrocities that accompanied slavery followed.

Significant wage pressures exist in 21st Century America. With government collusion (such as President Reagan firing the air traffic controllers in 1981), the level of labor unions among American workers in the private sector has dropped to less than 7% in 2010. Unions form an interesting check on owners paying too low a wage because as part of the wage negotiations the union should learn how profitable is the organization and since the laborers are doing most of the work it is only fair that they earn a fair portion of their contribution to the company's success. Unions then help to lift the wages of other workers in that industry due to the competition among the workers for the similar jobs. By getting rid of unions, companies are able to lower the wages of their employees, thereby increasing their profits and the compensation (and bonuses) paid to the top levels of management.

As the wages of the American middle class drop (even if they remain unchanged, inflation over time degrades the value of their wages), the consumer market is unable to sustain the original level of consumer purchasing, leaving the economy in something of a downward spiral (smaller market leads to lower wages and so on). American workers have become wage slaves, where they are unable to negotiate higher wages due to the high number of unemployed and they are unable to resist pressure for longer hours and fewer benefits like reduced health insurance since they are unlikely to find another company willing to hire them with the same benefits and with the same reasonable working hours as before. Employees are now at the mercy of their employers having lost any significant negotiating positions. This is apparently the goal of the various international trade agreements (the government working in cooperation with the interests of large corporations) with other countries, to put the American workers in competition with the much lower paid workers in those countries. Supposedly an American company would consider its American workers as partners in their economic venture. That stance has been abandoned for the new position where the workers in any country are just a resource for production.

The social structure of human beings, with the family unit taking responsibility for raising children initially and then the community helping to teach the children, enabled labor specialization. With the inherent diversity in humanity, each person is able to concentrate on refining their individual personal skills for the benefit of their community. Each person can find a job taking responsibility for some aspect of an economic endeavor, often in cooperation with others in a team or work group (our social nature), whether it is manufacturing a product, providing a service, or monitoring other activities (police and fire protection), so the entire community gains significant benefit. Without this specialization and cooperation, in a system where each person would toil only for oneself, humanity would probably not be capable of dominating the world as it does.

This social nature of an economy is being lost in the 21st century. Workers are barely recognized as human beings but are just becoming machines that happen to come to work every day, needing week ends off and some amount of vacation time. Teamwork is becoming less important in some industries where the mantra is becoming just 'do your job' which unfortunately fails to recognize the benefits of teamwork. Personal failure, such as becoming unemployed in this profit-oriented economy, is now considered the fault of that person who might be claimed did not work hard enough rather than as the fault of a system that no longer respects its workers. In this work environment where the benefits of working hard are being eroded, is it not natural to expect fewer will work as hard as before?

There are other negative aspects to the current capitalist system. The extent that each company works with the natural resources like air and water are also subject to whatever local government agency is monitoring them. The large American companies (and some from other countries) found a convenient way around that unfortunate 'problem' by shipping their manufacturing plants first to Mexico, and after noticing some wage pressures there, later to China and Southeast Asia where the governments were willing to sacrifice their workers and their local environments (with the low wages, poor working conditions, and toxic pollution) to get companies to move there.

The original social structure of an economic model where the local community is able to monitor and protect against abuse of people and resources has been lost. The multinationals and the international banks are able to threaten economic hardship, by the removal of jobs and/or financial support, if their demands are not met.

When economies are managed with extortion as one of the foundations and the governments (and/or their agencies) are often openly in collusion with those corporations, I find it encouraging the Occupy Wall Street movement has found many people willing to publicly demonstrate during the current economic crisis. Unfortunately I cannot yet envision how the current capitalist system (at its current point of evolution) can be improved into one that is more humane. That transition must be difficult given how pervasive the current system is. I expect it to take many large public demonstrations to start a change, given the government has the army with guns and the corporations have the money with its control.

created - October 2011
last change - 10/29/2011
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