For a more complete description of how a natural economy works, see my articles on the Voluntarised Commons Economy or The Free Federation. This article focuses on what advantages the proposed system brings.
A natural economy (also called communism, anarchism) is first and foremost supposed to solve the most pressing systemic problems with our current capitalist system: poverty, climate change and other ecological problems caused by overuse and misuse of natural resources, the energy and resource crises, and economic and financial crisis. There are other systemic issues we face such as sexism, racism and other kinds of prejudice and oppression of groups - but I won’t be addressing them directly in this essay.
Developing countries find it difficult to develop because in capitalism this requires a significant capital investment, but capital can generally only be invested where there is an expectation of profit. But poor people with no resources are not profitable. A natural economy solves this because it does not depend on capital investments to develop the economy - it only requires labour. For this to work, the means of production have to be removed from private ownership and entrusted to the people who need them.
Poverty within developed countries is also a widespread problem. This is eliminated in a natural economy because unemployment is eliminated: labour is shared out so that everyone has something to do. Moreover, since the means of production are shared among those who need them, there is no concentration of wealth in the hands of property owners, and hence no relative poverty.
The solution to the ecological and financial issues will become clear shortly.
A natural economy has undergone not one but two separate revolutions - demonetisation and democratisation - with a third revolution then an optional, but compelling, possibility - voluntarisation. Demonetisation is the abolition of capital and money; democratisation is the abolition of the state and hierarchy; voluntarisation is the abolition of all compulsion.
The abolition of money, exchange and private property is central to a natural economy. They are replaced with labour contributions.
In addition to being the crucial factor that allows us to eradicate poverty, a demonetised society has the following advantages:
No significant inequality in wealth. In most natural economic systems, your entitlement to products and services is completely divorced from the amount of labour you do or your ability to contribute. In others, there is a direct relationship between the amount you wish to consume and the amount you are expected to contribute. Either way, this means that inequalities between people’s material circumstances, generally speaking, will reflect the inequalities in their desires and preferred lifestyles, rather than their financial fortune or their heritage.
No growth imperative: Although a natural economy can theoretically expand faster than capitalism, it is, unlike capitalism, not required to do so to maintain economic stability. The economy can grow, shrink or remain stable precisely as the needs of society dictate, within the parameters set by the available labour and resources. But the economy would not grow more than it needs to, because there is no incentive to work more than necesary. This is one ingredient necessary to solve the ecological crisis.
As a more inoccuous example, there would be no profit motive encouraging people to run scams, become charlatans or sell bogus products.
Similarly, without a profit motive, production would be focused on producing the best quality products in the least possible time, removing the incentives for planned and competitive obsolescence (see below) and other techniques that are used in capitalism to convince people to buy things that they don’t even need or want. In short, production would be fit for purpose rather than fit for profit.
Overall there is less work to do and more leisure time (see below for justification).
A natural economy also revolutionises property relationships and political power. Private property is replaced with usufruct (possession defined by need or use) while authoritarian power is replaced with participative democracy and so-called ‘do-ocracy’. (A ‘do-ocracy’ is a system where individuals make decisions for themselves without needing nor asking for permission, with the proviso that the community can reverse a decision that affects them by their own direct action.)
While private property imposes ownership over the existing need/usage relations (Person A owns but does not live in my house; person B owns but does not work in my factory), possession/usufruct is derived from them, so that they coincide. That is why I call it the ‘natural’ system. ‘The people who need’ the means of production are the consumers; ‘the people who use them’ are the workers.
While authoritarian power imposes control over people’s behaviour and their life choices, natural decision-making merely reflects the decisions made by people naturally about their own individual and collective lives. Decisions are made by those affected: nobody who is not affected by a decision (e.g. the king) is allowed to interfere, while anybody who is affected by the decision must be included in it.
Democratisation is the revolution by which workers take control of their own work, citizens take control of their own community, teachers and students take control of their own schools, residents take control of their dwellings, and individuals take control of their own lives. An individual decision is made by the individual alone, but as soon as the decision affects somebody else, they must be included in it.
Democratisation works in tandem with demonetisation to allow a true and sustainable solution to the ecological and resource crises we face. Natural resources are re-entrusted to the commons, so that the community - not profit-hungry companies - decide on how they may be used. Thanks to demonetisation, there are no vested interests interfering with the exercise of this right. The lack of a growth imperative and instead the natural tendency to eliminate unnecessary labour allows society to shrink the economy within ecological limits without affecting the stability of the economic system itself. The democratic structures allow ecological considerations to be included in all decisions.
Aside from the ecological considerations, democratisation also implies that workers, since they are now in control of their own workplaces, will choose to make them safe and comfortable environments in which to work, and will not impose onerous working conditions on themselves. Though this depends on their ability to co-operate with each other, it is nevertheless motivated by everyone’s enlightened self-interest both as individuals and collectively. Again, demonetisation is necessary to prevent the profit motive from forcing the workers’ hands, since in a market economy it would be necessary to cut costs in order to compete, even if this has to be democratically approved.
As the discussion shows, demonetisation and democratisation are logically separate but really belong together, and their full advantages can only be realised in tandem. Many people argue for democratisation without demonetisation, and such systems can be labelled as ‘mutualist’ or ‘market socialist’. Such systems, however, would not reap the benefits of demonetisation elucidated above.
As I explain in The Free Federation, removing the requirement to contribute labour is a realistic and potentially advantageous goal. It gives people more liberty to make decisions based on their own personal requirements. People who are in a grey area of fitness can decide how much they wish to contribute and where. Parents can decide on the length of parental leave they find most appropriate. You can decide when in your life you want to start work. The elderly can retire at a time most convenient for their personal wishes and ability. And yes, lazy people with no interest in working at all can get away with doing nothing.
The reason why this is still a reasonable system is - firstly, that there is even less labour to do in a voluntarised system, because people no longer need to decide on exemptions criteria and enforce them; secondly, most people would be bored if they had no meaningful projects to work on, and not everyone is in the mood for endless partying and adventure.
But neither is the system so care-free as to allow people to flit from whim to whim with no sense of responsibility. Though you choose your own work and your own working time, you also commit yourself to contribute what you said you would contribute, and you must contribute a share of the total required labour. Projects will know how much labour needs to be done - in most cases they will still need to count the hours unfortunately - and the project members must co-operate to share this labour amongst the contributors. So it is not just a one-way conversation. If the labour burden is too high, then the rate of production can be lowered until new volunteers can be found.
In such a system, comfortable working conditions would be even more important. Under-employment would be more common, but the flipside is that recruitment would be even smoother - no talent could be wasted, no willing volunteer could be turned away without a very good reason, and it would be even more important to hold on to your fellow contributors: it would again be against your enlightened self-interest to be abusive, ungrateful or even indifferent towards them, because no matter how small their contribution, it helps to get the job done faster.
At the turn of the 20th century Kropotkin believed that four or five hours a day would be sufficient in a Socialist economic system, and he assumed that this figure would be constantly decreasing as technology improved. Indeed, technology has improved, but consumption has also increased and there is a greater range of products that people expect to have.
I think there is still good reason to think that replacing capitalism will give us more leisure time, even though I cannot yet prove it mathematically. There are in fact tendencies in a natural economy which lead to an increased workload, as well as those that lead to a decreased workload. Overall, I believe there would be a net gain in leisure time, i.e. a net decrease in working time.
These tendencies lead to a decreased workload:
Fewer middle-men: in general, products go directly from producers to consumers without going via retailers, wholesalers or markets. Though they may often go via a ‘collection point’, this still saves an immense amount of effort compared to the capitalist retail sector. It also leads to much less wastage, since most products have an intended recipient. By comparison, capitalist shops often throw away things they can’t sell.
Capitalism has a built-in tendency to ‘create work’ to perpetuate the cycle of consumption and exchange. In a natural economy this tendency is removed, which means that all unpleasant kinds of work are just a nuisance. Where production involves an unpleasant activity, there would be incentives for lowered rates of production and less extravagant consumption. This also favours efficient methods of production and less wastage.
No planned obsolescence: different from competitive obsolescence, companies deliberately design their products not to be durable for the long term in order to ensure future sales of new products. They also deliberately introduce incompatibilities with other companies’ products in order to drive sales of their own accessories. This creates lots of unnecessary duplicated and wasted effort.
More likely to repair rather than replace faulty products.
Automation is used wherever it can be. In capitalism this is not the case, partly because most companies/workplaces cannot afford the investment, and partly because in many cases cheap human labour is cheaper than using machines, regardless of how boring the labour is. Farmers in developing countries use labour-intensive processes because they cannot afford farming machinery that would help them so much. There is also resistance to automating some jobs because it puts people out of work. There are no such barriers in a natural economy.
A natural economy is not compelled to grow like a capitalist economy is. As a result, there is no incentive to exploit natural resources for their exchange value or to drive production to its maximum for increased profits. This in itself results in less extravagant production and decreased labour time, but it also means there is no barrier to environmentalist policies, which serves to further curb unnecessary production, cut down on wastage and reduce the ecological footprint.
Capitalism suffers unavoidable periodic economic downturns and crises in which companies go out of business, only for similar companies to be started up again afterwards. This wastes a lot of time and effort. A natural economy is immune to these effects.
As mentioned above, products tend to go directly from producers to consumers, which saves a lot of labour.
In a natural economy, second-hand products are distributed for free. This leads to more efficient usage of the available resources and significantly lowers the strain on the production system.
Migration of people is almost always considered a good thing and there are no arbitrary restrictions on who is permitted to work. This improves efficiency and saves on administration.
Because workplaces are owned and managed by workers, there is practically no such thing as a managerial class in the labour force and no specialism in management.
Less work-related stress and eradication of poverty means increased health and hence a decreased workload in healthcare. (This is a positive feedback effect.)
Less crime due to eradication of gross inequalities and increased liberty means that police and judicial services (or their equivalents) have less to do.
The following are tendencies leading to an increased workload in a natural economy:
In our capitalist economy, large numbers of people are living in poverty and their consumption is far lower than it should be. The elimination of poverty, both relative and absolute, increases the amount of work to be handled. For a time, it requires a significant investment in infrastructure.
Childcare and many other types of care work which in capitalism are often undertaken informally for little or no pay are here transferred into the economy and counted as labour.
If labour is voluntary then more people can decide not to work even if they are able to, which reduces the labour force. (Though this is to some extent balanced out by the super-rich in capitalist society who don’t need to work even though they could do so.)
More people are considered exempt from work, such as parents or people in full-time education.
Since more decisions are made democratically, decision-making time increases.
More goods and waste products are recycled, which increases labour time.
Workplaces have better safety procedures and improved working conditions (by demand of the workforce), which usually leads to increased working times at some points in time (though it is counteracted by the health benefits).
Stricter ecological stewardship leads to increased labour time, both in enforcing policies and investing in cleaner industrial processes.
The elimination of extreme poverty leads to changes in the age distribution, fewer young people and more elderly people. This reduces the overall size of the labour force and inflates care work.
In a democratised system the very concept of ‘employment’ is eliminated, since it implies a hierarchy between employer and employed. Hence I use the word ‘employment’ to mean the state when people are contributing to social production. Unemployment implies that people want to contribute but are unable to find somewhere to contribute. It does not include people who are exempt from contributing or the people in voluntary systems who choose to not contribute. It is possible for people to be temporarily unable to find somewhere to contribute in their local area, possibly because skills are required that the person doesn’t have. However, they can travel anywhere and can be accepted into any job that they are qualified for. There doesn’t necessarily need to be a ‘vacancy’. The precise details are complex and are explained in The Free Federation. ↩
The converse, demonetisation without democratisation, is a system I have not seen anybody advocating. Whilst I can imagine what it would be like, it is really not worth arguing for, since the two revolutions belong together. ↩