Democracy and Capitalism

A flagrant re-post from the Roe Valley Socialist blog:

I was recently reading over an excellent pamphlet published by the Left Economics Advisory Panel, a panel of economists linked to the Labour Representation Committee. The pamphlet, 'Building the new common sense: Social Ownership for the 21st century' discusses in a series of chapters the complete lack of democracy in the workplace and the disparity between the power of capital and labour.

As the pamphlet points out, citizens spend a significant period of time in their workplaces but leave their democratic rights at the door in the morning. When it comes to making serious strategic decisions about the direction of a company, decisions which could considerably affect conditions at work and even the direction of peoples' whole lives, workers are at the mercy of the tyranny of capital. Some firms obviously have a consultation process with their workforce but this is limited in the extreme; missing are the powers for workers to initiate reforms themselves, the ability to work outside an agenda already been determined by management, and the means to effectively challenge decisions short of industrial action.

Obviously, this comes down to the nature of private ownership of the means of production. Why, ask liberals, should workers have any say in what is in effect someone else's property; why, ask social democrats, should property owners wield such unaccountable power over the great majority of the population in a so-called democratic state; why, ask socialists, should production be in private hands in the first place, as private property is the foundation of this unbalance in democratic entitlements.

Beyond the micro-economics of the individual firm, the problem runs much deeper than this of course. The outcome of the next General Election might just be made by the currency markets rather than the electorate, if a Labour victory or a hung parliament is portrayed in the media to threaten the value of sterling. It might also be decided in marginal constituencies where the Tory tax-dodger and Belize-based businessman, Michael Ashcroft, is providing the cash for glossy leaflets and phonecall canvassing. On Newsnight on Tuesday, Justin Rowlatt followed a financial speculator who saw it as his rule to dictate to the Greek government how they should solve their fiscal crisis. His solutions were predictable- massive cuts and attacks on the standard of living of the Greek people. We can argue over whether this is necessary or not to ensure the survival of the Greek economy or not under capitalism but the boundaries of the debate are severely proscribed by the actions of those short-selling Greek debt. Unelected speculators have set the agenda for democratic governments; in a democracy it should be the other way around.

On an even deeper level this poses a fundamental challenge to reformist socialism. It was once the case that the state had strict controls over its currency; now, this control is shared with the financial markets who can decide to destroy any government they don't like the look of. Within the EU, fiscal policy is subject to numerous limitations, and nationalisation is technically subject to the dictates of competition law. In other words, there are great barriers to state intervention in the economic life of the country, especially when capitalism is not in crisis and capitalists resist such intervention politically through their support for neoliberalism.

Socialists must develop realistic and workable models to force democracy into the economic realm- through workers' co-operatives, trades unions and genuine democratic organs of the people. Otherwise, without redressing this balance between those who work and those who own, the latter will successfully resist any reforms which fundamentally risk the rule of capital. We saw it at Copenhagen where states came under pressure from entrenched economic interests, and during the bailout of the financial system where it was done on the banks' own terms despite their culpability in the precipitation of the economic crisis. It is a simple question of democracy and one which needs serious answers.