"... it is necessary to point out that there are some Socialists who do not think that the problem of the organization of life and necessary labour can be dealt with by a huge national centralization, working by a kind of magic for which no one feels himself responsible; that on the contrary it will be necessary for the unit of administration to be small enough for every citizen to feel himself responsible for its details, and be interested in them; that individual men cannot shuffle off the business of life onto the shoulders of an abstraction called the State, but must deal with it in conscious association with each other; that variety of life is as much an aim of a true Communism as equality of condition, and that nothing but a union of the two will bring about real freedom...

--William Morris, 1889, from a review of Looking Backwards by Edward Bellamy.

The monetary unit is the dhumin, a Minidun word, with a hard sound as in "there," pronounced "tumi" in Nacateca.  

  or -- the currency symbol is taken from  letter for "dh" of an ancient alphabet, reversed, in imitation of the British Pound  symbol-- £.

Bergonia's Socialist Economy

consisting of worker-owned cooperatives, 

federated into large enterprises and syndicates,

selected infrastructure monopolies,

"federated planning"

with open markets in retail sectors.

The Individual's Prerogatives; 

The State's Limited Role;

How Open are the Markets? 

What are the Syndicals?  The Development Councils?  

Foreign Investment;  Foreign Trade;  No "Free Trade" with Capitalist Nations;  

Collective Purchasing

OVERVIEW --
the general organizational principles of the economy. 

Workers own the tools and the fruits of their labor.  They, not any capitalist class and not the State, shall own the economic enterprises.  This is the basic principle-- that the workers of the individual enterprise shall have control and keep the "full value" of their labor, including the "surplus value."  (Here is Principle #3.)  "Full value" means the remainder of income after deducting proper expenses.  Implicit here is the requirement of decentralization of socialist economic structure (Principle #4), so that power is on the shop floor rather than in the capital city, and so that the workers in the plant and not the state have first claim to income.

The entire society has co-equal claims to the fruits of workers' labor, and the democratic State represents the entire society.  So while an individual group of workers have first claim to their tools and their own labor, they contribute support for "all the people"-- the entire body of fellow citizens, including children, elderly, disabled, caretakers and all others who cannot work.  (Principle #7)  "All the people" means those interests which are general to all members of society (e.g. health, welfare, education, defense, police), and the State has the function of insuring these interests.  This is the justification for socialist taxes and "funding."

All institutions in society shall be democratically run, including the economic enterprises.  (Principle # 2)  It is not just the State that must be subject to democratic control.  Socialism is the ultimate application of democracy to the entire society and to all institutions and organizations, so that no abusive or exploitative power exists anywhere.

Management of enterprises shall be democratically chosen and replaced.  (Principle # 2)  Enterprises have an undeniable need for professional managers, and a healthy enterprise depends on a good balance between worker preferences and enterprise efficiency.  Workers thus submit to management that they choose, but may easily eject management which looses their trust. 

No economy can operate well without stability; thus the State shall apply consistent monetary policy to stabilize the economy.  Every enterprise must plan and budget, and a stable currency is a necessity to making the economic predictions necessary for good planning.  Bergonian socialists have been sensitive to how price instability benefits the powerful and bleeds the average family.  It is an injustice to allow inflation to shrink the real value of workers' labor, effectively robbing the people.  It is also understood that capital cannot be effectively accumulated and used without price stability and a stable currency.

All society's institutions are expected to remain solvent, and limit expenditures to income.  Yes, Bergonia has a "balanced budget amendment" to discipline not only its government entities, but its worker run enterprises as well.  The lack of fiscal discipline will have the effect of obfuscating the value of workers' labor and make efficient distribution impossible.

Government shall not subsidize enterprises, except for emergency, public health or seed resources (e.g. capitalization).  If the Development Council planners see the need for a new industry (e.g. imaging, genetic engineering), they may dedicate original capital to buy the necessary machinery and set it up.  Once the first workers are hired, they take it over and move on.  

Socialist banks shall finance expansion and recapitalization.  These are the national and regional development banks.  Every state and every subdivision has at least one bank of its own.  Worker-run enterprises may borrow money at reasonable interest rates.  Capital is made available for expansion of targeted industries, and to pay for the expenses of complying with environmental laws.  Development banks also underwrite research, study and design projects, in conjunction with the syndicates, academia and the professions. 

Any central economic planning authority must be representative, so that the regulated enterprises can participate and put a check on it.  This means that all the regulatory and planning bodies must contain representatives of the affected classes, usually delegates from syndicates and professional associations.  e.g. the Environmental Bushenre (council) includes reps from the national association of manufacturer coops, while the Telecommunications Bushenre includes (among others) reps from the actors, artists, writers & journalists syndicates, local stations associations, the technical trade & craft syndicates.

All planning authority must be reasonably limited, so that workers enterprises can function autonomously in a relatively open market.  The planning authority sets minimum wages and some maximum prices, product quality standards, and accounting standards.  It provides  independent auditing services, and may step in when an enterprise begins to fail.  No production quotas exist, except as stated in arms-length contracts, which the government negotiate with worker-run enterprises.  While Soviet style planning trumpeted production goals for state-run enterprises, Bergonian planners have depended much more on contracting between autonomous sectors & industries.  This allows, in a socialistically institutionalized fashion, for production to follow demand.  

For example, the fed-coop that builds tractors & other agricultural equipment does not respond to a government directive, but waits for forecasts & actual orders from the peasant coops.  In turn they reach out to their suppliers, other coops that make the tires, the steel, the electronics, the paint and the spark plugs.  The scale and the nature of the agreements is not to unlike the agreements between a large multinational manufacturer negotiating huge purchase of parts & material from other corporations.

Society benefits from the class of independent shopkeepers, craftsmen, sole proprietors and professionals.   These people require little regulation, except to protect their employees and the public health, and yet they generate much of society's creativity and beauty.  Who can beat the local bakery? 

Independent courts and mediators freely sort out disputes between various interests & institutions.  (See Law)  In a pluralist society, disputes will flair up between the independent units, and neutral arbiters will be needed to settle and quell the disputes.  A neutral arbiter of disputes frustrates all grabs for power.

The society in policy and practice will value conviviality, relaxation, stability, artistic creation, public pageantry, and spiritual and other non-material pursuits.  (See Daily Life)  Thus the society will repudiate values such as greed, lust for material crap and other deformed capitalist values.  The payoff for such pursuits should be structurally limited.  Vanity, pride, achievement and self-improvement will hopefully have more appeal than wealth and gluttony.

Marxist-infected socialism has failed because it merely reapplied capitalist's core materialist values.  Marx himself never justified the classless society beyond assuming that the revolution would unleash the productive capacity of the proletariat. .Since communist  thinking remained dominated by materialism, communist societies remained susceptible to capitalist regression.  The truly socialist man in the deeds of his life places value on non-material things.  Socialism should bridge the false divisions between "science" and religion.

Socialism requires a cooperative ethic. The ethic necessary for group enterprises is the same ethic that promotes politeness, taking turns, civic honesty, and respect for law.  Individualism and tyranny both allow a ruder, crueler ethic.  

Bergonians understand that structures work feebly and rules barely at all when the people working in enterprises follow a corrupted ethos.  The nature of the underlying ethos determines the ultimate quality of the decisions of government and cooperative councils.  It rarely happens that deliberate government action will mold or alter the popular ethos (although it happens more often than American conservatives will admit).  Instead, the popular ethos/culture/values will dictate the form, substance and style of all government and economic activity.

See "Parecon,"  Participatory Economics, socialism by another name.

Collective Purchasing

A great many enterprises and consumers purchase goods through "buyers collectives."  Many local supermarkets are, in fact, such collectives usually sponsored by the local commune. Sometimes the collectives get quantity discounts and pass the savings on to their members.  Villages and city neighborhood collectives sponsor and help capitalize needed local stores and arrange for a discount to the members.  A lot of the big federated cooperatives (like auto plants, naval works, tax processing centers, banks) sponsor buyers collectives for their members, and even sponsor stores.  Collective members often put in orders for goods in catalogs circulated by the collectives.    

The original organizers found inspiration in the cooperative movement of the Scandinavian countries.  However the best models for collectives exist in Bergonia's own history, particularly in the traditions of the peasant lunra (village) where virtually all work and all wealth was shared.  Similar cooperativeness abound in the peasant life of Old World cultures, such as the panchayat of India, the mir of Russia, and the manorial villages of Medieval Western Europe.  Here is a fine example of how cooperative enterprises in pre-industrial society should be adapted to modern urban conditions.

FOR MORE DETAIL

SEE THESE PAGES:

ECONOMIC SECTORS -- how health care, agriculture, manufacturing, media and other sectors are organized.

COOPERATIVES  -- how most economic enterprises are organized, and how workers own the means of production.

HOW WORKERS GET PAID --all workers in an enterprise partake of the profit, according to "shares" determined by labor & skill.

TAXATION -- how the central authority taxes economic activity to fund the collective welfare.

INTRODUCTION TO SOCIALISM  -- the basic argument.

SOCIALIST THEORY -- the underlying justifications for Bergonian Socialism.

THREE BASIC TYPES OF ECONOMIC ENTERPRISES:

(a) cooperatives & federated cooperatives, 

(b) monopolies, and 

(c) small proprietorships.

(a)  This economy consists of hundreds of thousands of independent worker-owned and worker-managed cooperatives (also referred to in law as "corporations").  

Large enterprises are structured federations of functional, elf managing cooperatives.  For example, a large manufacturing enterprise includes numerous production cooperatives in the factories and cooperatives handling clerical, IT, procurement and other support functions, with contracts with independent sales cooperatives.  Nearly all the manufacturing, distribution and wholesale sectors are organized on this cooperative model.

The exigencies of modern industrial production necessitate an internal organization of specialized function, which is traditionally and capitalistically accomplished by a pyramidal hierarchy and a "disciplined" (see Foucault) workforce.  In contrast the "federated co-op" approach sets up a new democratic upward process that stands parallel to the traditional, reliable command hierarchy, and the command hierarchy itself is democratized so that the ones who (under any circumstances) issue orders are accountable and recallable. 

The core idea is that every work unit or cell gets its orders from the command hierarchy, but determine internally how to get the order fulfilled.  The members of the unit or cell are collectively rewarded for good work and collectively criticized for unsatisfactory work.  The command hierarchy is necessary for production, if for nothing else to coordinate the scheduling and timing of  production and coordinate production with sales, and after its democratization it serves as the coordinating agent among federated collectives..  The appearance of the new would of course attenuate the old, and-- in time-- supplant it altogether. 

(b) There are a few big monopolistic corporations, charted by Congress, each one either handling a crucial area of the economy or a manufacturer of a massively complex & socially/politically important commodity.  The peculiarities of Bergonian tax policy make it convenient to monopolize these economic activities that are taxed-- primarily what they call "energy transactions."  This makes the collection of revenue for all the levels of government incredibly easy, and freeing millions of people from hassle.

The monopolies are organized as federated collectives, so that the workers still enjoy internal self-government.  However the usual organs of federated cooperative government are augmented by a politically appointed board of governors to represent the national interest.

These are the monopolies: 

(a) Teleberga, the phone company, 

(b) The all-important railroads:

twelve regional railroad lines that maintain the rails, beds & bridges,

six regional railroad freight carriers,

the national federation of passenger rail services,

(c) five major airlines and a few others serving the special needs of localities, like the Sargaso islands, 

(d) Fushamir, the national electric generation authority (named after an ancient lightening god), and several regional distribution authorities,

(e) the "Workers Revolutionary Weapons & Armaments Reorganization" (WRWAR, called "Warware" in slang), the national weapons development authority,

(f) Skyrider, the one big company that builds commercial and military aircraft,

(g) Arvesar, the one big company that builds ships,

(h) Icarus-Rex, the one big company that builds missiles, rockets and spacecraft.

(c)  This economy also consists of a large number of shopkeepers, professionals and craftsmen working as (a) sole proprietorships, (b) partnerships and (c) family-owned enterprises.   Nearly all professional and personal services (lawyers, doctors, barbers, plumbers), and the rather large sector of "shopkeepers," are organized on this small-scale proprietorship model.

The laws of enterprise organization set limits on the size of these proprietorships-- usually limiting such entrepreneurs to twelve employees before they have to transform the business into a worker-owned enterprise, and such employees have specific entitlements to minimum wage, vacation, sick leave and workers compensation.

A large segment of the retail market consists of independent shopkeepers.  A large number of the nation's plumbers, electricians and mechanics are independent.  Here are the thousands of people in society who prefer to work alone or in small groups as opposed to a collective or corporation.  They are often called "cats," as opposed to the "dogs" in cooperatives and bureaucracies.  

The rule of twelve keeps an artificially low cap on the size and scale of businesses.  Small business proprietors have kept pressure on the politicians to raise the number higher, but they face daunting odds, especially since in 1955 the Congress raised the original limit of eight to twelve to widespread opposition.  In 1968, when the radicalism that mirrored what was occurring around the world swept Bergonia, the Congress flirted with the idea of restoring the lower limit, which would have meant layoffs in small shops all over the country.

One way of getting around the limit is to split the enterprise into specialized segments and then to unite them with a contract.  For example, a small builder will, instead of hiring carpenters will find a carpenter with whom he feels comfortable and help him form his own small business, consisting of junior carpenters.  The contractor and the carpenter will enter into a contract whereby they build homes together.  This gives the two men an effective ceiling of 24 employees instead of twelve.  A small hotel will encourage someone to organize a "housekeeping" business.  This new friend hires young women and enters into a contract to perform all the housekeeping & maid service for the hotel, so that the hotel  proprietor  will not have to count the housekeeping staff against his maximum of twelve.  In the same way the hotel finds a trustworthy cook who forms a business and they sign a contract for the operation of the hotel's restaurant.  

A variegated, pluralistic economy, consisting of thousands & thousands of worker cooperatives.  

Some co-ops are independent, free-standing, run pretty much by standard co-op protocols and direct democracy.  Examples: restaurants, small glass plants, IT & computer services, nursing homes, publishers, heating & cooling services, and building contractors.  To handle paperwork and record-keeping, a lot of these co-ops either hire a "business agent" or contract with an independent cooperative of clericals.

Other co-ops become units or cells within large "federated" organizations (with open committees & votes as needed), such as hotels, hospitals & institutional healthcare, manufacturing, transportation, banking, and retail enterprises, often with thousands of workers, some combining tens-of-thousands.

A Heterogeneous, Decentralized Economy.

There is no one-size-fits-all mentality as to economic organization.  Different economic sectors require different degrees of coordinating authority, different command, information and exchange structures & patterns, different degrees of workforce heterogeneity, and different public interests at work.  Thus, each sector is said to have its own "constitutional formation," and each bears examination in turn.

This is a variegated economy, with pockets of unsupervised liberty and pockets of militarized order,  This suits the variegated personality of humankind.  Different people have different personalities.  Some work well in structure, others want independence, while a few want to be in charge.  There are introverts and extroverts, people with high stress levels and people with low stress levels.

The Individual's Economic Prerogatives

A citizen owns his personal property-- his clothes, furniture, appliances, mementos, books, guns, jewelry and cash.  He has an absolute right to this that defies any government's attempt to tax (i.e. no personal property taxes in Bergonia).  His right to these items also defies police searches and seizures.  This includes his bank accounts and mutual funds, as well as his income entitlements from the various socialist income funds.  He may build up equity in collective property that may entitle him to a share after his separation. 

A citizen may pursue whatever career he chooses, as in a capitalist country.  No one assigns him to a job or a position.  However the citizen is not allowed to become a capitalist, which is to say that he may not own the means of production on which another's livelihood depends, except on a very small scale.

A citizen enjoys the power and the right to participate in the management of his collective and in the organization of his own work.  He also has a right to a share of the collective income, which is certainly more than a take-or-leave-it boss-imposed wage.  (The difference is the "surplus value" that the capitalist expropriates by means of his unearned power over the "employee")  He has the assurance that his share is inalienable.  These are prerogatives he would not have in a capitalist country.  

A citizen has the right to come and go.  He may quit his job, move across the country and try something new.  However, freedom in a socialist-syndicalist system is more valuable than capitalism's "labor mobility," which makes workers desperately chase across continents in pursuit of work.  The typical Bergonian worker chooses to stay close to home with family and community, and if he wanders far he always knows where home is.

A citizen has a right to his copyrights and patents, and to make money from them.  However, Bergonian law allows patents for only seven years and a copyright for fourteen.  They may renew afterwards on a shared basis by the artist or inventor and the public interest, which is assigned to the artists guilds, the scientific societies, and the schools. 

A citizen and his family have proprietary rights to their dwelling place, commonly translated into English as a "leasehold," which is obtained from the public land authority.  The leaseholder pays "rent" to the local government, and real estate taxes do not exist.  No authority may cancel a leaseholds and evict a person except for non-payment of "rent" or violation of land use & zoning laws.  Leaseholds may be inherited and transferred, up to a point.

What are the Syndicates?

Certain economic sectors are coordinated, at least in part, by syndicates (English)/syndicals (French)/sentoc (Minidun)/seneticei (Nacateca.  Syndicates are federations of worker-owned enterprises within a single industry, trade or profession, like guilds.  They sometimes have the authority to set prices and engage in huge transactions that Americans would regard as "restraints on trade."  Syndicates manage just about all commodities transactions in Bergonia, plus a large amount of wholesale trade.

For example, peasant syndicates negotiate contracts for huge quantities of wheat with the bakers syndicates of the various cities and counties.  In turn the bakers syndicates negotiate with milling  and processors collectives, and with the truckers.

Although syndicates end up regulating or setting standards for their members, they do not control the entire sector-- because membership in a syndicate is optional for any cooperative.  syndicates, as a matter of law, are voluntary associations.  Indeed, in many sectors, there are networks of syndicates, or competing syndicates.

More on the syndicates in the individual economic sectors. 

What are the Development Councils?

A number of development councils exist in the land.  The Congress created these to promote new industries by providing capital and planning.  The development councils receive funding from the Congress in the form of both loans and banks, and the development councils also raise money from interest on loans it makes to enterprises and the selling of bonds.   The development councils play a major role in the proliferation of new technologies.  They make loans to both new and existing enterprises.  The loans to existing enterprises enable them to adopt new technologies. 

The councils enabled many manufacturing and mining enterprises to install environmental controls, for example, in the 1970's by extending loans and arranging for discounted prices on the controls.  The councils arranged the latter by purchasing the controls in mass quantities from the enterprises manufacturing them.  The councils saved the manufacturers the expense of marketing the controls.

Development councils fund the transfer of agricultural technologies to peasant collectives.   The Agricultural Development Council have funded irrigation projects.  They have funded large new enterprises, such as computers.  The Communications Develop­ment Council funded the creation of Bergonia's version of the Internet and the protocols.  The Health Development Council has distributed the funds necessary for the development  of new medical technologies, including heart valves, surgical supplies, and MRI's and other imaging equipment.

Governance of  the development authorities conforms with those provisions in the constitution that delineates the structure of corporations.  The member ship of the council consists of representatives of constituent organizations.  In typical Bergonian fashion, the councils include (a) representatives of the particular national "Bushenre" (councils) which controls the pertinent economic  sector, (b) members of the organizations who receive  the  councils services, and (c) specialists in the particular field.  Thus, the National Agriculture Develop­ment Council includes (a) four representatives of the National Agricultural Bushenre, (b) seven representatives  of various national peasant and farming organizations, and (c) seven agronomists nominated by various specialist bodies and chosen by an election of other specialists, as well as three specialists selected by the Agriculture Academy .

Foreign Investment?

Foreign corporations are not permitted to operate in Bergonia, unless they do so in conjunction with cooperatives.  

For example, Toyota contracts with local cooperatives to build Toyota vehicles in Bergonia.  The federated cooperative enterprise (consisting of over 2,400 individual collectives), named Banken Motors, receives a license from Toyota to build the vehicles to Toyota's general specifications.  Toyota, however, has little say in how the autos are built.  Banken, of course, pays Toyota  per vehicle it produces, but Banken owns the vehicles it produces and sends them to the distribution cooperatives for retail sale.  (Incidentally, in Bergonia it is common for individuals to order cars in advance to specification.)  Under the licensing agreement, Banken and the distribution cooperatives are permitted to use and display Toyota trademarks.  Banken and Toyota also have a joint venture agreement for marketing the Toyota brand in Bergonia.

This system preserves the integrity and autonomy of the worker cooperatives, while allowing the foreign corporation to make a little money.  

This arrangement works well for the importation and production of foreign brands.  There is absolutely no foreign investment in the oil, minerals, forestry, and agricultural sectors. 

Because of Bergonian defiance of the criminal U.S. embargo of Cuba, the Helms-Burton Act, passed by the mad dogs in the U.S. Congress in 1995, has drastically reduced American foreign investment in Bergonia.

Foreign Trade

When foreign corporations want to buy Bergonian commodities, they make deals with the syndicates, which represent the various small-scale producer collectives.  Trade in services and manufactured goods usually occurs between capitalist corporations and the federated collectives.