Supernovae, Debt Snowballs, and class struggle
A dear friend of mine has recently been saying to me that there is no way for working people to obtain the means of production through the existing economic system. I believe that there are ways in which workers are already acting to use the economic structures of our society to acquire controlling interests in their respective workplaces, thereby creating worker-owned collectives. Thus, I believe that the existing economic system, despite its flaws, can be used by oppressed people in the process of liberating themselves.
When I cite examples (such as Bi-Mart [worker-owned since 2004] and WinCo Foods [worker-owned since 1985]), this friend says these are isolated cases, and that it’s still impossible for the workers (who have comparatively less capital) to purchase the means of production from the bosses (who have comparatively vast quantities of capital). While I would acknowledge that it would be impossible for this to happen all at once, I believe it is possible when done piece-wise, even quite rapidly. Note that when I indicate piece-wise action I do not intend to imply any lack of solidarity among the disparate pieces – in fact, I believe such solidarity is essential to the success of this approach. The systematic process I will suggest is best understood by reference to the fields of astrophysics and personal finance.
If we consider the layers of a dying giant star to be the class distinctions in our global economy, the latest working models of supernovae – and the reasons for failure of previous models – are instructive in thinking about the dynamics of the economic empowerment of the working class. Astrophysicists have observed that a giant dying star will sometimes be transformed simultaneously into a tiny neutron star and a supernova explosion. Until quite recently, there were no computer models capable of describing the process by which stars could simultaneously collapse and explode. The problem, it turned out, was that the models being used assumed uniform collapse of the outer star material, and simultaneous uniform expansion of the core. The assumption of perfect symmetry broke the model, because the inner and outer layers of the star could not pass through each other. The solution was to introduce some volatility and asymmetry to the model. By introducing minor asymmetric variations in the forces with which the inner and outer matter would expand or contract, and allowing for convection currents, the new model predicted behavior much more like that which has been observed. That is to say the new model worked, predicting the formation of supernovae from the sorts of systems known to form supernovae, and not from others. Thus, while some have thought that the only way for workers to expand beyond the constraints of economic class would be for them to switch places with the privileged all at once, it seems that asymmetric growth in economic power has a precedent among the stars.
The lack of economic capital in an entire class is not unlike personal debt by an individual. In his book, Total Money Makeover, Dave Ramsey suggests that individuals should eliminate their debt by using what he calls the Debt Snowball. My understanding of the process is that he advocates, quite simply, for focusing on eliminating the smallest debt first, regardless of interest rates. The would-be debt-eliminator then works on the next smallest debt, using the entire sum that would have gone toward paying off the debt(s) that had been eliminated thus far. This second step is repeated until all debts are eliminated, possibly over the course of months or even years, but quite likely much faster than if the debt-eliminator had simply paid minimum due amounts. If an underprivileged economic class (or a debtor nation) were to practice this approach to debt elimination, great strides could be made quickly, freeing up the economic resources that had been tied to former debts to be used in pursuit of further liberation.
If we consider our economic system, it should be clear that not all the wealthy are equally wealthy, and that not all workers are equally lacking in economic resources. But as with the Debt Snowball for the private debtor, workers can pool their economic resources to acquire low-cost local means of production, and use the accumulated capital to either solidify their holdings or aid other workers in doing likewise. Just as the first wave of expansion in a supernova pushes through the outer layers of the dying star where those outer layers are most ready to trade places or move out of the way, those workers who have access to economic resources can pool them to acquire the means of production from small or faltering corporations, or to build their own. And just as the first wave of stellar expansion makes way for the next, the members of these worker-owned collectives can create conditions in which their brothers and sisters can acquire economic resources for themselves (or, ideally, for their collaborative networks of values-aligned individuals). Those, in turn, can pool their resources to continue the process.
Thus, while the workers cannot all simultaneously acquire the means of production through our current economic system (which might well require more liquid capital than can be mustered by all workers simultaneously), workers can certainly acquire the means of production in a piece-wise fashion. Not only does this seem more palatable to me than a popular uprising in which the workers “simply take over the factories,” it also seems far more likely in our culture, as the individual steps are accessible to workers and operate within the bounds of law.
September 13th, 2007 at 01:48
five things, briefly because it is late.
1 - Sure, i’ll buy that change can come on small local levels and in
pieces that build upon one another. Yes. I sure hope so — because I
think it’s important that the struggle for economic justice engage
folks in a grassroots democratic way.
2 - Unlike in the case of the supernovaing star, it’s not sufficient
for the layers of poor and rich to just switch places. Rather we need
to distribute wealth — and the means of producing it, and the systems
by which those means are allocated — more broadly and more evenly.
When i remember that we need a restructuring (as opposed to just a
rearrangement) of the economic system, it does seem to me that while
that might occur through many small acts, those acts (in individual or
coordinated ways) will have to challenge the existing order, not just
follow its rules. Many small acts within the existing system of rules
will lead only to a reordering i think.
3 - Case in point: The means by which capital is used to accumulate
more capital are counterproductive to the goal of diffusing wealth.
The labor theory of value, right? Natural resource is worth
something, you add your labor to it, it’s worth more. Capitalist
sells it, keeps part of the price as profit, you receive less than the
market’s value for your labor. So. Workers owning their own factory
get to keep the full value of their labor, so far so good. But if
they take their capital and invest it to get more capital, that profit
they get comes from the stolen value of other workers’ labor. I am
still skeptical we can amasse enough capital, within this system where
the capitalists steal our labor, to buy most of the means of
production from them. If we want to accumulate capital we either
steal it from other workers (or cooperatively pool what surplus we can
find among all the workers but the whole point is we as a class don’t
have much surplus) or we take it from the bosses. Theft from the
workers or theft from the owners. I know which kind of theft seems
fairer to me. You can count history into it and the account will
consistently show that wealth was amassed unjustly; or you can leave
history out of it and just say, it’s not fair for some to have so much
more than others, wherever it came from. Either way, it’s not theirs.
4 - The capitalists en masse aren’t going to sell off the means of
production. Here and there yes. As a class no. They know they have
class interests. Sure they do.
5 - Third-world country debt (and for that matter i think probably a
lot of personal debt too) has reached grossly unmanageable
proportions. I don’t think money-management tips are enough to
address it. A1, the amount of money is just too vast. It’s ruinous
no matter what order you pay it off in. B2, the debt is fictional and
unjust. The first world’s riches come from excavating the resources
and exploiting the labor of the third world. It is a theft. We
should be paying them back, not the other way around.
regardless, am glad we agree workers’ co-ops are great.
sleep well, good friend!
a
September 13th, 2007 at 11:22
I think we agree on more than might have been originally apparent.
1: Indeed. And not just to “engage” the much-ballyhooed grassroots, but to be driven by them - with decisions being made by people operating in their local communities, working with their friends, family, and neighbors.
2: Yes, well… clearly, the supernova metaphor has the potential to extend in some rather unpleasant ways. For example, who is it that’s going to wind up being in the neutron star afterward? In all the rushing around, with half a star going the other direction, it’s all too easy for anyone to get there. Thus, as you say, the many small acts by which we restructure the economic system must challenge or entirely replace the old system.
And just as clearly, given that our economic system requires there to be more debt in the system than the total assets in the system, the debt can never be eliminated within the system (except through debt relief programs, as you say). Debt is used to control the economy through a central bank, which would simply collapse if all debt were eliminated. There are some interesting tricks that can be played with the system, but they’re not really fundamental shifts. The sort of fundamental shift that I envision would be to operate real capital production, sell it in a debt-free economy in parallel with our old economy, and generate enough surplus to start paying off old-economy debts.
3: No theft is fair. Pooling surplus, however scarce, can build real capital, with which more surplus can be generated and used or shared to build further capital (social, real, or economic). If the real capital is sold for a new type of symbolic (economic) capital, one which represents real goods rather than debts, we’ve jump-started a new economic system. Except it isn’t totally new, because people are already doing this with the Terra Trade Reference Currency. If we continue selling some surplus to the old market (or trading Terras for old-market currency), we have a means to eliminate other people’s debts too. Because the Terra model is counter-inflationary (rather than being paid to sit on unused capital, you’re charged Terras for holding onto them – the wealthy pay for the banking), it encourages trade without lowering standards.
The trouble with simply grabbing the means of production is that, as you say, it’s theft. It simply re-creates the same old structures with a new cast of characters at the top. The system is not fundamentally altered by such action. The system could be fundamentally altered by collectives that decide to trade in non-debt-based currency.
4: Not en masse – one at a time, convinced that they can make a buck, or inspired by the new economic structures we’re creating. That’s the point of the supernova analogy - you don’t have to get them all to do it together, and some of them (like me) will value this new economic system and switch over voluntarily. Some will hold onto a debt-based economy until it falls apart, find themselves at the center of the neutron star of our metaphor, and attempt to levitate while grasping their bootstraps. If the worker-owners of our new economy are wise, they’ll give these folks some kind of a job, and the compact remnant of our supernova will be (appropriately) moving rapidly away from its original location.
5: Of course personal finance tips won’t get us to total structural change. They are, however, instructive as a procedural model. The same idea is reflected in these two Permaculture principles: start locally with small-scale intensive systems; do work where it will be effective. A1: Yes, there’s more debt than assets, but if a group of workers build enough real capital to meet their needs and then some, they can start just forgiving debts - this is applying the debt snowball to the global debt structure. If enough people do it, the old economy will collapse for lack of debtors, but we’ll all be okay because there’s plenty of production. B2: Indeed. Wouldn’t it be ironic if the non-industrialized nations were to produce an alternative economic system in which we were unnecessary, sell things to us, and forgive us our debts? (Which, by the way, was suggested by a radical anti-imperlialist activist in Jerusalem two millenia ago, with the words, “forgive us our debts, as we have forgiven our debtors.” Debt was then, as it still is, among the primary means of oppression and imperial control.)
I’m excited about this new economy, and about working with my friends to create it.
-g
September 13th, 2007 at 17:04
Perhaps.
1. Agreed.
2. Agreed, until your last line, which I’d like to understand better.
But the sort of fundamental shift I envision would be to abolish the
old debts, abolish the very system of debts and selling, and build an
economy based on cooperation, sufficiency, the meeting of needs.
Clearly we’re not likely to do that tomorrow. But I don’t think
paying off old debts gets us closer to there, nor will it be a needed
step when we do get to that point.
3. Disagreed. Property is theft. I don’t see any basis for claiming
any legitimacy to the existing distribution of wealth. I agree with
you that putting new folks at the top doesn’t solve the structural
problem. That’s why we need collectives with no one at the top.
Alternative currencies are interesting but don’t address, for me, the
central salient issue here. The wealth does not belong to the folks
who claim to own it. It is not theirs. We don’t need to pay them for
it, not even in currency we hope to render obsolete (but that in the
meantime represents our very real labor and time). We need to
rewrite the rules to assert the truth that we own the wealth in
common, all of us — former owners included, but not in any more
special position than anyone else.
4. You may be ruling-class, but you don’t own a corporation. If you
did you would not be allowed (by your bylaws and your stockholders) to
give it away to the workers. Agreed on some of this, though. But see
above. And I think it should not, need not, hinge on whether the
owners personally see the light, as long as enough of the rest of us
do. Because the wealth isn’t theirs any more than it’s ours. The
owners can participate personally in the revolution, just like any of
us can. But they shouldn’t get to be the special arbiters of whether
and when change or redistribution is permitted. Especially when the
old system is easier on them than it is on everyone else.
5. I like those principles (act locally with small-scale intensive
systems; do work where it will be effective). That’s helpful. I
sometimes try also to think about which local & effective efforts will
build alternatives to capitalism, versus which simply build a better
capitalism. (I prefer the former.) Sometimes a tricky question to
figure out. So A1 I’d rather ignore and delegitimize the debts than
work on paying them off. And B2 yes I agree with you and your ancient
pal that debts are a major tool of oppression and imperial control.
Yes.
-a
September 20th, 2007 at 06:56
Heya!
This is Nate, Gavin’s brother. I’ve been visiting, and he mentioned there’s a good thread on his blog.
I have worked/struggled with these issues for years, and so when I ask the following questions, I am not attempting to end inquiry — I am trying to evoke genuine answers.
If property is theft — and perhaps it is, perhaps all territory-defense from the bacterial to the human is best seen as theft — then is it possible to have a codified form of territory that does not exclude others? If so, how? (Spanish Anarchosyndicalism, totalitarian communism, real communism a la Twin Oaks ecovillage, and all the other collectives I’m aware of each codify personal and group territory — access to relationships, materials, etc. — in a way that excludes some others who may be less privileged) And if not, if we choose to give up the unfairness of claiming and defending a territory (symbolic, material, relational or otherwise) when others have differing amounts of resources, how can we organize, how can we take effective action, how can we survive in the face of the territory-claiming behaviors of others?
What does it mean to have a collective with no-one on top? How would that organization work, and how could we guarantee that no-one will be “on top”? To clarify, in defining “top” we might distinguish between a formal position of dominance, a formal position of responsibility for day-to-day operation of the whole, an informal ability to exert substantial influence over others through affection or rhetoric, and an informal result of receiving more access to resources than others receive. Perhaps there are other ways of conceiving of “top”…
Are loans always a tool of oppression and control, or is it possible to loan someone something, expecting to be repaid with interest, and at the same time be serving the person to whom you loan? Are equity-investments equally bad? What about the sorts of informal investment strategies that structure giving in a gift economy? Is there a different approach to sharing access to (resources=capital=meansofproduction) that allows us to promote the well-being of all parties to the exchange, including the surrounding community/ecology?
I’ve come to my current response to these issues after several experiments that now seem to me naive. I now believe that the nature of living systems requires boundaries and structures, and that whatever we call it (theft, etc.) we must claim as territory that which we care for lest others organize (disorganize, damage) it in ways we dislike. I like approaches that generate cooperation and collaboration, but I don’t see a way to do away with territorial claims.
I am also aware that any interactions between non-identical systems result in asymmetries (no duh, right?). This means that differences in skill, habit, social networks, etc. always produce someone in an interaction we can categorize as “top”. Instead of focusing on “no-one on top”, I’d rather ensure that the formal governance of the organizations I’m involved with captures the concerns of everyone involved, makes it easy for people to access shared resources, and promotes fluidity of “on top”-ness.
In looking at existing models by which work communities organize themselves, I have come to believe that certain kinds of employee-owned companies are just as good at meeting the above concerns as the “no private income” communes I’ve seen. Also, I don’t perceive institutions such as the Grameen Bank as oppressing the women of Bangladesh — and will I do more good if I lend/invest my wealth to people, thus generating a surplus I can continue to lend/invest, or if I give it away into the cash-sucking wasteland of our debt economy? Having tried the latter, I decisively favor the former. So I basically believe that it is not capital investment as such, but rather the relationships between investor and entrepreneur (and worker, and community / ecology) that are decisive in determining whether any particular investment strategy is oppressive.
I find the wave of new economic entities that is slowly growing around the world to be very exciting. I believe we are currently seeing an evolution, rather than a revolution. This evolution will change the way groups of people organize themselves and do business with each other — although there will, for various reasons, be people who are left behind. I do not believe that this new model is perfect, and I do not believe that it will be everything everyone needs — only that it will serve humanity, and enable us to cooperate and collaborate, better than the last model.