Beyond State Capitalism-The Commons Economy in our Lifetimes

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Sun Aug 8 15:30:47 BST 2010

  Beyond State Capitalism

          The Commons Economy in our Lifetimes

    By James Quilligan

Posted July 30, 2010

In considering the essential problem of how to produce and distribute 
material wealth, virtually all of the great economists in Western 
history have ignored the significance of the /commons/ — the shared 
resources of nature and society that people inherit, create and utilize. 
Despite sharp differences in concept and ideology, economic thinkers 
from Smith, Ricardo, and Marx to Keynes, Hayek, Mises and Schumpeter 
largely based their
assumptions on the worldʼs seemingly unlimited resources and fossil 
fuels, their infinite potential for creating economic growth, adequate 
supplies of labor for developing them, and the evolving monoculture of 
/state capitalism/ responsible for their provision and allocation. 
Hence, in the /Market State/ that has emerged, corporations and 
sovereign states make decisions on the production and distribution of 
Earthʼs common resources more or less as a unitary system — with minimal 
participation from the people who depend on these commons for their 
livelihood and well-being. Because our forbears did not account for the 
biophysical flow of material resources from the environment through the 
production process and back into the environment, /the real worth of 
natural resources and social labor is not factored into the economy./ It 
is this centralized, hierarchical model that has led to the degradation 
and devaluation of our commons.

Over the past seventy years especially, the macroeconomic goals of 
sovereign states —
for high levels and rapid growth of output, low unemployment and stable 
prices — have
resulted in a highly dysfunctional world. The global economy has 
integrated dramatically
in recent decades through financial and trade liberalization; yet the 
market is failing to
protect natural and social resources, the state is failing to rectify 
the economic system,
and the global polity is failing to manage its mounting imbalances in 
global resources
and wealth. Without a ʻunified field theoryʼ of economics to explain how 
the commons is
drastically undervalued and why world society is amassing huge debts to the
environment, the poor and future generations, policymakers and their 
institutions lack
the critical tools and support to address the massive instability that 
is now gripping the
global economy. Businesses and governments are facing the Herculean 
challenge of
reducing climate change and pollution while alleviating poverty without 
economic growth
— a task for which the Market State is neither prepared nor designed to 

Meanwhile, the essential ideals of state capitalism — the rule-based 
systems of
government enforcement and the spontaneous, self-regulating social order 
of markets —
are finding direct expression in the /co-governance and co-production/ 
of common goods
by people in localities across the world. Whether these commons are 
traditional (rivers,
forests, indigenous cultures) or emerging (energy, intellectual 
property, internet),
communities are successfully managing them through collaboration and 
action. This growing movement has also begun to create /social charters/ 
and /commons
trusts/ — formal instruments which define the incentives, rights and 
responsibilities of
stakeholders for the supervision and protection of common resources. 
Ironically, by
organizing to protect their commons through decentralized 
decision-making, the
democratic principles of freedom and equality are being realized more 
fully in these
resource communities than through the enterprises and policies of the 
Market State.

These evolving dynamics — the /decommodification/ of common goods through
co-governance and the /deterritorialization/ of value through 
co-production — are
shattering the liberal assumptions which underlie state capitalism. The 
emergence of
this new kind of management and valuation for the preservation of 
natural and social
assets is posing a momentous crisis for the Market State, imperiling the 
legitimacy of state sovereignty, national currencies, domestic fiscal 
policy, international
trade and finance, and the global monetary system. Major changes are on 
the way. The
transformation of modern political economy will involve reconnecting 
with — and
reformulating — a pre-analytic vision of the post-macroeconomic global 
/Another world is coming: where common goods are capped and protected; a
portion of these resources are rented to businesses for the production 
and consumption
of private goods; and taxes on their use are redistributed by the state 
as public goods to
provide a social income for the marginalized and to repair and restore 
the depleted commons./

Although peopleʼs rights to their commons are often recognized and 
validated in smaller
communities, scaling these lessons to the global level will require a 
new dimension of
popular legitimacy and authority. The world community is rapidly 
evolving a sense of
social interconnectivity, shared responsibility and global citizenship, 
yet the sovereign
rights of people to the global commons have not been fully articulated. 
In declaring our
planetary rights for these commons, we shall be confronting many 
decisive questions:

(1) Are modern societies prepared to create a framework in which the 
behind production and governance are not private capital and debt-based
growth, but human solidarity, quality of life and ecological sustainability?

(2) How soon — and how peacefully — will the subsystems of the Market State
integrate their structures of value-creation and sovereign governance 
with the
greater biophysical system of ecological and social interdependence?

(3) Can the global public organize effectively as a /third power/ to 
develop checks
and balances on the private and public sectors and establish the /resource
sovereignty/ and /preservation value/ needed for a commons economy?

These issues will be filtering into mainstream discussion over the next 
two decades.
Already the system of state capitalism is breaking down, threatening the 
entire planet,
its institutions and species. When this collapse can no longer be 
contained and a global
monetary crisis ensues, world society will have the choice of creating 
an economic
system that follows the universal laws of biophysics and commons 
preservation — or
accepting a new version of 18th-20th century mechanistic economics, 
obliging humanity
to continue living off the common capital of the planet under corporate 
feudalism and
über-militaristic regimes. Our decision will likely come down to this: 
/global commons/ or
/global autarchy./ As an economist, I donʼt pretend to speak for the 
conscience of
humanity; but as a human being, my heart tells me that we shall see the 
beginnings of a
commons economy in our lifetimes. The long-forsaken global commons are 

/James Bernard Quilligan has been an analyst and administrator in the 
field of international development since 1975. He has served as policy 
advisor and writer for many international politicians and leaders, 
including Pierre Trudeau, François Mitterand, Edward Heath, Julius 
Nyerere, Olof Palme, Willy Brandt, Jimmy Carter, and His Royal Highness 
Prince El Hassan of Jordan./

Posted July 30, 2010

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