The Challenge of the Era of Technological Abundance

Gar Alperovitz.Gar Alperovitz. (Photo: Stephen Voss)Truthout’s continuing series of excerpts from Gar Alperovitz’s “America Beyond Capitalism.”

This is an exclusive Truthout series from political economist and author Gar Alperovitz. We are publishing weekly installments of the new edition of “America Beyond Capitalism,” a visionary book first published in 2005, whose time has come. Donate to Truthout and receive a free copy.

Without local democracy, there can be no culture of democratic practice; without security and time, there can be only a weak citizenry; without decentralization, it is difficult to mobilize democratic practice and accountability; and without major and far-reaching new forms of wealth holding, there can never be adequate support for the conditions and policies needed to build a more egalitarian and free democratic culture.

The United States is the wealthiest nation in the history of the world. By the end of the twenty-first century it will have the technological capacity to increase the income of all its citizens many times over or to radically reduce work-time and thereby allow a new flowering of democracy, liberty, and personal and community creativity. The new century could be – should be – one of innovation, hope, even excitement.

Few Americans approach the century this way. The future is clouded by problems rather than opportunities; it appears as an era of great political difficulty and danger. At the most obvious level is the threat posed by terrorism and war – and the many challenges to liberty that overly zealous approaches to both have produced. At another level are the growing social, economic, racial, and other difficulties catalogued in the preceding pages. Critically, confidence that the great traditional values at the very heart of the American experience can be sustained has been declining rapidly.

America Beyond Capitalism.(Image: Democracy Collaborative)A society committed to enhancing equality, liberty, and democracy that is unable to achieve such values in practice – indeed, that is moving in precisely the opposite direction – is committed to a morally incoherent politics. If such a politics continues through time, ever greater cynicism must develop; and with it, an ever deepening sense that American society has lost its moral compass, that government policies are merely the result of power plays and brokering between interested parties that do not and cannot claim any deeper democratic or moral legitimacy.

A political-economic system can continue to violate the values it affirms for a very long time without major consequences. It is unlikely, however, to be able to do so forever. The question is: can a meaningful, morally coherent, and ultimately positive politics be constructed in the emerging era of technological abundance?

Can a new direction be set that acknowledges the systemic nature of our problems and openly posits a concrete alternative and a process that might move in a new direction? Can the system be changed?

It is important to stand back from the current moment to consider underlying issues of principle that will frame the politics of the coming era – to and through times of war and terrorism . . . and beyond. Leaving aside the question of near- or long-term political-economic feasibility, four fundamental contentions are suggested by the evolving political-economic developments we have reviewed:

First, that there is no way to achieve movement toward greater equality without developing new institutions that hold wealth on behalf of small and large publics.

Second, that there is no way to rebuild Democracy with a big D in the system as a whole without nurturing the conditions of democracy with a small d in everyday life – including the economic institutions that allow and sustain greater stability of local community life.

Third, that there is no way to achieve democracy in a continental-scale system with a population moving toward 400 million people – and possibly a billion or beyond – without radical decentralization, ultimately in all probability to some form of regional units.

Fourth, that there is no way to achieve meaningful individual liberty in the modern era without individual economic security and greater amounts of free time – and that neither of these, in turn, is possible without a change in the ownership of wealth and the income flows it permits.

These four contentions stand on their own. Indeed, at this point in American history, the ball is in the court of those who hold that equality, liberty, and meaningful democracy can be achieved without meeting the challenges suggested by the four basic points. Further related questions are whether there is any other way to achieve gender equality, ecological sustainability, and the sustained reality of meaningful community.

The Pluralist Commonwealth model holds, beyond this, that democratic control of large economic enterprise – a central problem confronting all political-economic systems – can never be achieved without transforming and making public the ownership of large-scale wealth and without developing a new culture – and further, that this can only be done by building on the four key elements.

Without local democracy, there can be no culture of democratic practice; without security and time, there can be only a weak citizenry; without decentralization, it is difficult to mobilize democratic practice and accountability; and without major and far-reaching new forms of wealth holding, there can never be adequate support for the conditions and policies needed to build a more egalitarian and free democratic culture.

Finally, the model is based on the judgment that greater equality, greater individual economic security, greater amounts of free time, and – upon this basis – the reconstitution of a culture of common responsibility are ultimately required if we are ever to reorient our community and national priorities in general.

The central argument of this book is that the first decades of the twenty-first century are likely to open the way to a serious debate about these and other systemic questions – and further, that real-world conditions during the coming period are likely to offer opportunities for establishing substantial foundations for a possible longer-term systemic transformation thereafter.

The prospects for near-term change are obviously not great – especially when such change is conceived in traditional terms. Indeed, although there may be an occasional progressive electoral win, there is every reason to believe that the underlying trends will continue their decaying downward course. In many ways times are likely to get worse before they get better.

On the other hand, fundamental to the analysis presented in the preceding pages is the observation that for precisely such reasons, there is likely to be an intensified process of much deeper probing, much more serious political analysis, and much more fundamental institutional exploration and development. We have also noted that there are important signs of change in the traditional “laboratories” of democratic process. States from Alaska to California, and from Alabama to Ohio, have moved forward to create – and systematically build political support for – many new political-economic experiments and strategies. Federal fiscal and other decisions are now producing pain and reassessment at every level.

Traditionally, a distinction has been made between reform, on the one hand, and revolution, on the other. The former implies nonviolent improvement in the outcomes of a given system – with no fundamental change in its basic institutional structure. It cleans up around the edges of the existing system, as it were – sometimes slowly, sometimes in major political outbursts. The latter commonly implies abrupt and often violent change – above all, of the fundamental institutional structures of the system.

The kind of change that appears in the various trajectories of emerging U.S. development involves an unusual combination of strategic approaches. Like reform, in the main it involves step-by-step nonviolent change. But like revolution, its process is oriented to the development of different institutional structures to replace traditional corporate forms over time. It might appropriately be called “evolutionary reconstruction.”

A politics based on evolutionary reconstructive principles does not abandon reform when it can achieve important gains. On the other hand, such a politics explicitly seeks to understand – and to foster – the longer-term foundational requirements of the values it affirms. It is not satisfied with, or misled by, occasional electoral gains that do little to alter the direction of long-term trends. It is a politics of historical perspective and commitment to the long haul.

Few predicted either the upheavals of the 1960s or the conservative revolution that followed. Major eruptions and political realignments are the rule, not the exception in U.S. history. Large numbers of working Americans; blacks and Hispanics who will become a majority as the century develops; senior citizens (and those who shortly will become seniors); women who seek practical ways to achieve thoroughgoing gender equality; liberals and conservatives alike who value family and community; environmentalists who cannot secure protections either for endangered goals or sustainable growth along current lines of development – all are finding it increasingly difficult to realize their objectives through traditional means.

A fundamental question is what may happen as various groups, each beginning with more narrowly defined interests, come to the realization that what they value most cannot be achieved without a new approach. If, as appears increasingly likely, such awareness begins to intersect with the knowledge and experience gained through the development of new strategies and ideas, new possibilities are likely to become available to politics in the coming era. Beneath the surface level of politics-as-usual, it is by no means clear that the public is or will remain quiescent forever – especially if social and economic pain continues, if political elites continue to overreach, and if new directions begin to be clearly defined.

The term “conjunktur” designates a coming together at one moment in time of diverse trends to create new, unforeseen, and often dramatic opportunities for change. A major electoral shift or political realignment is easily conceivable – and with it the truly interesting question of the first decades of the century: whether foundations for something much more far-reaching might be established for the period beyond.

The legitimacy of the present economic arrangements and entitlements is also likely to be called into question by large-order developments that intersect with – and strengthen – ongoing efforts to achieve change.

In the late 1990s economist William Baumol pointed out that per capita GDP in the United States had increased ninefold since 1870 – and that almost 90 percent of this growth was due to innovations developed over the previous 130-year period. Even pre-1870 innovations such as the steam engine and the railroad, he observed, “still add to today’s GDP.”

Nobel laureate Robert Solow has similarly pointed out that current economic growth must overwhelmingly be attributed to “residual” factors that, broadly speaking, involve the huge contributions of inherited technological knowledge. Again, research by economist Edward Denison has shown that advances in knowledge are “the biggest and most basic reason for the persistent long-term growth of output per unit of input.”

The moral – and hence, ultimately, political – implications of this growing understanding are beginning to be recognized. Above all, as historian Joel Mokyr observes, the vital knowledge we receive from the past comes to us through no effort of our own as a “free lunch.” The implicit question is inherently explosive: if so, who should rightly benefit, and in what proportions, from this extraordinary inheritance – this free gift that produces so much of our common abundance?

Seth Shulman, the author of Owning the Future, has made the obvious connection. The elites who hold most of the rights to modern technologies “are legally sanctioned, but the legitimacy of their claims often remains dubious because of the debt they owe to innovations that have been made possible only by years or decades of collective advances.”

The current technological contributions that produce such huge rewards for the fortunate few, in short, are a mere pebble placed atop a Gibraltar of received science and technology that makes the modern additions possible – and that was often paid for by the public, and that can be traced back through many generations, indeed, centuries. Current elites, William Gates Sr. urges, disproportionately reap the harvest of what is inherently a collective investment. Gates proposes their estates be taxed accordingly.

The late Herbert Simon, another Nobel laureate, defined the central issue this way: “[A]ny causal analysis explaining why American GDP is about $25,000 per capita [1998] would show that at least two-thirds is due to the happy accident that the income recipient was born in the U.S.” Simon termed the vast gift of the past a sort of “patrimony” received simply by the chance of birth – and like Gates, urged that this should be subject to large-order taxation.

We have noted growing anger at the extreme wealth of some amid the great poverty of others – and, too, at the corrupt practices of many leading corporate executives. We have seen that elite ownership has very little to do with the demands of efficiency and productivity, and that a variety of institutional forms can manage wealth effectively – indeed, often more effectively than traditional forms.

The new understandings that the computer, satellite communication, and the Internet increasingly underscore are the moral wild cards of the era of technological abundance. Nobel laureate Joseph Stiglitz urges in general that “just as the importance of land in production changed dramatically as the economy moved from agriculture to industry, so too does the movement to a knowledge economy necessitate a rethinking of economic fundamentals.” As recognition that the sources of modern abundance are deeply rooted in the legacy we all commonly receive from the past continues to develop, it is likely to bring with it a powerful critique of all justifications of current wealth ownership patterns and a powerful rationale for new, broader allocations and institutional strategies.

Little has been said in the preceding pages about global issues and international relations. The reason is not only that this book is devoted primarily to U.S. developments. It is that it is extremely difficult to imagine a fundamental shift in America’s stance toward the rest of the world absent a transformation of our own ways at home. The argument of Alexis de Tocqueville and John Stuart Mill – that ultimately democracy in a nation depends upon the development of democracy in its communities – is echoed in the judgment that America is unlikely to play a different role in the world until it is a different America – until it finds ways once again to realize values of equality, liberty, democracy, and, one day, perhaps even of community in our own land. Efforts to alter the excesses of America’s international stance and to persuade the United States to respond more humanely to global problems are both essential and laudable. If we Americans truly hope to help others around the world, however, we have much hard work to do, first and foremost, here at home.

Large-order institutional restructuring, we tend to forget, is exceedingly common in the long sweep of world history. The difficulty lies in pulling ourselves out of the present moment to consider our own possibilities in broader historical perspective.

We have begun a new century. The coming decades will establish the terms of reference for further, future change. It is not possible to know whether a new direction based on the developing ideas, models, practical experiments, and new alliance explorations can lay the foundations for the next political-economic system. Or whether, over time, a new basis can thereby be established for a politics capable of unleashing the moral energies that can flow from a renewed commitment to achieving equality, liberty, and democracy.

It is possible, however, for one person – each person – to help refine our understanding and our strategies and to help establish the practical and political elements needed in the first stage of any realistic forward-moving developmental process. Each step is valuable on its own terms, no matter what.

Long before the civil rights movement, there were many years of hard, quiet, dangerous work by those who came before. Long before the feminist explosion there were those who labored to establish new principles in earlier decades. It is within the possibilities of our own time in history that – working together and openly charting an explicit new course – this generation can establish the necessary foundations for an extraordinary future and for the release of new energies.

It may even be that far-reaching change will come much earlier and much faster than many now imagine.