This is the second section of the interview with Jo Cotenier.
You pretend that using this method under socialism exploitation would be ruled out and that a more egalitarian society would be installed, with mainly the small minority of people driving their income from property losing.
Yes, let us look on it at two levels. One is why Marx poses the issue of payment according to labour first. It’s because the fundamental inequality in capitalist society comes from the exploitation of labour. Almost all inequalities come from that. That is the fundamental thing that has to be abolished in the socialist society. The way Marx want to abolish it, is by abolishing the wages system, which means you abolish the purchase of labour power, which means you no longer have the labour power’s price determined by the cost of reproduction. Instead the principle of paying according to labour is what, in fantasy, bourgeois economy claims already happens, that the people are paid the value of their labour . It is never what actually happens. You dont get paid an hour for an hour, but what people get is always, consistently and necessarily, under capitalism much less than an hour.
Secondly, from the Communist Manifesto, the Draft Program of the French Workers Party and the Critique of the Gotha Program, whenever Marx talks about income, he says there has to be income tax. And the public expenditures should be met out of income tax. The point here is that the entire value of labour, the hours that you work are accredited to you and then income tax is taken off. This is quite different from the mechanism that was used in the Soviet Union, where although they had some income taxes it was very low level and only covered a small part of State expenditures. Most of State expenditures came from the profits of the enterprises. Therefore the actual return to workers was much less than the level they could have been. They received back in kind, in goods and services, but these where funded out of the profits of State enterprises. As such, the origin is hidden, the people don’t see where the value comes from, it doesn’t appear that it comes from human labour, it appears it is something created by the State. That inhibits democratic debate over how the surplus product is to be allocated and how it is to be spent. Because labour costs were represented to soviet enterprises only as wages which were an even lower fraction of the working day than under capitalism, because of the free or subsidised goods, it often did not appear profitable to use labour saving machinery, leading to labour hoarding by factories.
You say that many of the techniques needed for performant planning are yet applied by market systems (barcodes, input-output matrices, feedback-systems….). What is finally the most distinctive characteristic of the planning system you propose, in opposition to the market systems?
The most significant thing is that you have common ownership of all enterprises, there is no profit income, all value is appropriated by the producers and they collectively decide what percentage of the hours they work will be used for other purposes. That is why the principle of labour-accounts is central when Marx talks about it. He says they, labour accounts, can only operate on the basis of directly social production, which means that the individual unitss of production do not reproduce themselves by selling at a profit or loss. The individual units of production are just branches of common organism, they are not independent juridical subjects which own property and which, to survive, must sell property.
Then you have to plan the production. Can you explain how you resolve the calculation problem.
You have to distinguish short term from long term planning. What you require in the short term is not that different from what is now logistics. Which is what the bar code system provides, it provides just-in-time delivery of the many different products. That is what maintains the actual coherence of the capitalist economy, it is not the price mechanism. It is the quantity order mechanism that maintains its coherence . If all the things that each supermarket is going to deliver each day had to be obtained by bidding on the market by each manager of each supermarket by the price mechanism the smooth level of stocks would not work. That aspect, the infrastructure, is already there.
The longer term problem is how do you make sure the things are
a) correctly valued when they go to the consumers and
b) how do you work out implications of changes in the structure of the economy.
This is something which the Austrian economists concede, that if you just continue production and allocation at the same scale and do not change, there would never be any difficulty in a planned economy. The difficulty they said is the deciding on the correct valuation and therefore correctly choosing the most efficient future options in the organisation of production. As to the correct valuation, the correct valuation of things is if everything is valued at the amount of time that takes to produce it. The market economy approximates that in prices, it approximates it quite closely, but its an approximation. The first problem therefore is to be able to calculate the number of hours in each product.
Then people can rationally decide whether, if I consume this thing am I consuming the same amount of or a proportion of work that has been done by me. Clearly the decisions of all consumers have to be such that all consumers have to choose to consume no more than the amount of values , or hours, the society has allocated in consumer goods. That level of correctly valuing is essential to maintain a balance in the economy. That balance is disrupted if you systematically undervalue certain consumer goods like the Soviet Union and other countries did. Therefore you get a lot of shortages if things are undervalued.
The question of the long term plan for change can only be done if you have a model of the economy: in computer language, what you have to do is simulations. Let’s take issues just at present, at the moment. It is clear that we cannot go on using fossil fuels at the level that the society is using them before. You therefore have to shift society to using renewable energy resources. This has a whole series of implications downstream of all things that will have to be changed. That kind of all-round planning requires you to be able to simulate different structures of the economy and choose which of those is going be the most efficient. And already to some extent in capitalist society the pressure of climate change means that studies of that sort are being carried out by the International Panel on Climate Change. They have to calculate how society is going to reorganise its material reproduction in order to survive. That is the kind of issues where planning is going to be more efficient than a market system. Because the market system has been trying to control the amount of carbon emissions and because it is done in terms of carbon price we don’t actually get a direct control over the real amount that is coming outside in the atmosphere. What you need to do planning like over a twenty year period how you will have to reduce the production of coal and the production oil by 5% a year over this period, what is the implication of this in the number of nuclear power stations, the number of solar panels you have to produce, and you have to advance the resources to build the factories of solar power, nuclear power factories etc, and comprehensively restructure the economy in that way.
Therefore it is the kind of situations which is analogous to the rapid restructure that the Soviet economy had to undergo in the nineteen-thirties where growing directive planning has been so effective and these is becoming a matter of potential survival for humanity. Current models predict that by the mid 2020s in tropical areas you will have passed beyond their current climate statusand in northern Europe you will have it by the twenty fifty. When we say pass beyond the climate status the average temperature in a normal year will be higher than the records that have been in the worst hot year. When that happens the implications will be huge for food and populationand dramatic. These are issues in which only a directive and calculated planning is a feasible solution.
You have also elaborated concepts about democracy, linked with the issue of planning.
If you are going to have democratic control of the economy, this democratic control can only be carried out at the level of perception the population in general can handle and understand. You always will have to delegate some things to technical management committees or State executives to decide things, but you have to always at least pose the outcomes of it in a way that everyone can understand. One of the advantages of posing things in terms of labour hours you can put the questions to people in a meaningful way. It’s not meaningful if you ask how many billion euros a year should the European Union spend on solar power. If you ask how many hours a day or how many hours a week should your wages been reducted by, for environmental change, that converts it into a meaningful poll. You can have referendum style votes either to increase or reduce the number of hours a week that everyone has deducted from their wages for several broad headings of expenditures.
You can’t expect the whole population to vote on every fine detail but they have at least to be able to control the surplus product, control what they don’t consume. If it is not to be exploitation, it has to be a voluntary decision taken collectively how it has to be used and you have to present that in a way that it is democratically intelligible and you have to hold popular votes. The only way .you can know everything is by serious accounting of what is the broad issue, what should be the magnitude of the general budget headings, how much overload in terms of resources is going on education. That kind of issue.
At your university department you have elaborated a lot of methods to apply direct democracy by means of electronics, smartphones, etc. How does it function?
We have done a number of prototypes by student projects to allow, first, a secure system of voting on yes/no questions by mobile phone. Basically the idea is everybody is given a voters card with a number on it like your credit card number. Nobody knows what the number is, except for you. When we have try-outs at the university we go round with them in a box and each person selects a card and we don’t know who has which card. When you vote you send a text message either to a yes telephone number or a no telephone number and your voters card number. When the message comes in it is checked that it is a valid voters card number. The voters card number is made up of two fields, the first is the public field and the last is the secret field. That is like the number you type in to a bank machine.
At the end of the vote, all the numbers that voted yes and all the numbers that voted no are listed on a webpage and the secret number fields are hidden, but you can go and see if your card has been correctly listed in the yes or the no. You can also see if the telephone number is correct. Anyone can download the listed votes and count by his own computer and see if account is correct.
This is very important because you see in countries where you have electronic voting, like the United States, that there are repeated allegations there is fraud going on. In one of the last votings in the primary between Bernie Sanders and Hillary Clinton, people are reporting that the votes initially at one stage in the evening showed Sanders ahead by 60% and a few minutes later the TV shows numbers are switched. There is no independent way anyone can count votes, it is just software, and the software can print a different number out. People also say that they tried to vote for one candidate and that the system refused to vote for that candidate. There is no way that people can audit the voting system used in the United States. The machines are black boxes, you can vote on them and you just have to trust the software company which plans the software, to believe these results are not completely made up. The statistical studies are showing in the elections that Bush won that there was systematic biases between what the opinion polls said and the results, only in those States that used the electronic system. So our aim is to come out with a verifiable voting system, that can be verified by the public, that is completely open but still anonymous.
Finally, you have a view of a fluent and fast transition between socialism and communism. Do you mean this is due to the actual possibilities of technology?
The transition from the first to the upper stage could be achieved almost immediately in Europe. The difficulty is the first stage, it is not the transition to the second stage. The difficulty is to get rid of private property, to move to the system of labour-accounting and get rid of the money.
If you have done that, the second stage is almost achieved by social-democracy. It is accepted in the principle by social-democracy that their should be some compensation if you have children. The sick shouldn’t be charged for the medicine. These principles of Marx have mainly been achieved in many European countries. It hasn’t been achieved in the United States, it hasn’t been achieved in the third world. The second international parties were able to bring this measures in the nineteen-fifties and sixties. It’s easy to say the State will make payments to people with children. The bourgeoisie doesn’t mind that so long as it comes out of the taxes on the working class in general. What they were not able to do was to challenge exploitation itself. So that is the key political question, it is much harder to do.