Collective economics are an alternative economic system to capitalism and communism, popularized by the economist Michael Albert and his group, the Participatory Economics Foundation (Parecon). The main premise of collective economics is that people should be rewarded with income for their time and effort, not for what they own. This concept may resonate with black workers in America because of their history of exploitation based on skin color alone. Collective economics could also help to combat poverty since it would be similar to a universal basic income. In that all citizens would receive money based on need rather than merit.
The Basics of Parecon
Parecon stands for Participatory (or Par) Economic (con)omy. It’s a proposed alternative to capitalism and state socialism, which operates on a very simple principle of from each according to ability, to each according to need. Parecon is also an economic system in which power is equally distributed among individuals who interact as equals in voluntary associations with one another. Furthermore, this economic system uses personal rewards as opposed to monetary payments and prices.
How Parecon Works
Although the debate is ongoing regarding how best to implement parecon, a few key characteristics of parecon are non-negotiable. First, decision-making will be collective and democratic. All individuals who work together in any context for more than a few hours should participate in making all their own decisions about what to do, how to do it, and when to do it. Participation cannot be limited by age, gender, income level or other status. Every person has an equal say in determining what everyone does.
The Theory Behind Parecon
It’s easier to think about how parecon works once you understand how it’s different from capitalism. And even if you don’t totally agree with parecon, understanding its implications can deepen your analysis of our current economic system. Parecon is set up with 3 basic principles in mind: Economic Self-Management, Remuneration for Effort and Sacrifice, and Broad Consumer Autonomy.
Some Benefits of Parecon
Participatory economics (parecon) provides a vision of a society based on solidarity, self-management, equity, and diversity. Parecon has important implications for how we view economics in relation to race and racism.
Why Should African Americans Care About Parecon?
The new book Parecon: Life After Capitalism, by Michael Albert and Robin Hahnel, shows people how to live well without capitalism. Their answer? An economic system called parecon is short for participatory economics. Unlike traditional economic systems such as socialism or capitalism, parecon aims to create an economy that is planned democratically through councils and balanced through a complex system of accounting. Finally, it might be easy to dismiss the idea of an alternative economic system like parecon based on other non-capitalist economic models (the Soviet Union comes to mind). However, while collective economies may not be suitable in every circumstance (Africa is definitely a different situation than Europe), we can take lessons from African Americans’ history in America about how we would make collective economies work better. -MM
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