The Promise and Peril of the Third Wave: Socialism and Democracy for the 21st Century (page 6 of 7)
By Carl Davidson, Ivan Handler and Jerry Harris
The Chicago Third Wave Study Group / May 1, 1993

The common view of ownership is that it is an institution of power. If I own something, I have decisive power over that object. I should be able to do with it what I want. This can cause problems, since many of the things that can be owned can also be used in ways that society must restrict. One example is product liability law. If I produce and market a product, which is later shown to be harmful to my customers, I can be held responsible for the damages and forced to compensate the victims.

In bourgeois society, individual liberty and the private ownership of property are the fundamental values. Prior to the bourgeois revolution, most power and wealth belonged to the church and the throne. Individual privacy, to the extent that it could be defined at all, was wholly subordinate to autocracy and theocracy. The rising bourgeoisie had to assert the primacy of private property into order secure the wealth it was amassing through the slave trade, manufacture and the looting of the new world. It wanted to multiply this wealth by recycling it as capital and thus liberating the productive forces from the restrictions of medieval or despotic society. Private property in this sense was a revolutionary force undermining the old order.

While this view of private property has some historical justification, the concept of a formal private ownership that takes precedence over social obligation does not. The latter is based on the myth that society has little or nothing to do with the production of wealth, i.e. all millionaires are supposedly "self-made men" who got their wealth "the old-fashioned way, by earning it."

But no one is self-made. It is our social being that makes our private selves possible. All of us benefit from and contribute to society and its institutions. The large variations in wealth among individuals are not due to inherent differences between individuals. At best, the differences are rooted in the various ways individuals are able to access and use society's resources. At worse, the differences are wholly arbitrary; they are accidents of birth, or war, or theft.

In our view of socialism, we affirm the entrepreneurial spirit, the motivating energy of the market and the right of individuals to become wealthy through the private ownership of the capital they have helped to create. At the same time, we fundamentally reorder priorities in how both property and capital is defined. While both personal property and capital may still be owned by individuals. we no longer see ownership as an absolute power. Property, especially productive property in the form of capital, is to be seen primarily as a social power relation that can be guided and regulated, just as other power relations are regulated for the common good of society. Incomes are also subject to progressive taxation.

From this perspective, when a person dies, his or her socially productive wealth returns to the social commonwealth. The inheritance rights of one's offspring would be confined to a set limit, say, $1 million per child. Of course, contrary to any right-wing hysterics, we are not talking about family homes, or heirlooms, or personal belongings, or any situation where persons would not even own the shirt on their backs.

As we see socialism, the social control of capital takes precedence over the rights of ownership of capital. In doing so, distinctions will be made first of all between individual property and capital. Individual property is owned by an individual for his or her own benefit (or family or friends), not as a direct agent for the production of wealth by employing others. Property becomes capital when it is used for the production of wealth by exploiting labor power.

Individual property needs to be reasonably protected. But capital needs to be invested profitably in those areas that benefit society and sustain the ecosphere. Laws and regulations are among the tools that a government of radical reconstruction can use to achieve these goals without "nationalizing" or "statizing" the ownership of capital itself. In particular, tax laws can be created to punish capital invested in unproductive speculation, or in production processes that pollute the environment, or in factories that prevent unionization. At the same time, other enterprises that offer or create societal benefits--such as new environmentally beneficial technologies--may not be taxed at all for a set period. Finally, some forms of capital investment--such as schools, research centers and infrastructure--will be publicly owned.

Our goal here is sustainable economics that is both dynamic and innovative. Under third wave socialism, the laws governing economic transactions first of all will be geared to sustain and improve the health of society and the environment. Power relations that are in harmony with this direction will be reinforced. Power relations that go against this direction will be retarded.

In this context, market forces, in particular the drive for innovation and new profits, will be the major devices used to carry out economic restructuring. It should be clear by now that the market is necessary for the practical functioning of any economy. We will go further: we don't think there are or will be stable economies without markets, except for small tribal hunter-gatherer societies or religious communities like the Amish. Wherever a "command" economy was established on a larger scale, an unofficial "black" market quickly asserted itself as the only efficient way of getting things done.

But we also believe there is no such thing as a "free" market--all markets operate in uneven fields of power that have an impact on transactions between buyer and seller. Nor is a "free" market necessarily desirable, since unrestrained market forces can be tremendously destructive to both social and biological values.

Markets where the fields of power are guided by intelligence, however, can be a dynamic and creative force. But using market laws to direct the economy toward sustainability will never be easy. This is why political democracy is so critical. When new problems arise, laws must be changed or created to reflect new circumstances. These laws need to be crafted democratically so that everyone can have an impact on the direction of the market, rather than just a narrow elite that directs the market for its own exclusive benefit.

Considerations for a New Strategy and Tactics

Where do we go from here? The road forward is not in the direction of old ideas about social and political equality but toward new ones based on the realities of the third wave. This in turn requires fresh answers to the fundamental question of strategy and tactics: Who are our friends, who are our enemies?

We believe these questions must be answered anew from the perspective of the third wave's impact. We offer only a bare outline of the factors to consider.

The third wave has caused splits both in the labor movement and in the ruling classes. Among the capitalists, those trying to create the new information based economy are often in conflict with those that are trying to keep the old industrial beast alive. Among the workers, the situation is more complex. Some high-tech workers have great hope for the third wave but are dubious that those in power now will ever allow for change that is democratic or ecologically sound.

Some blue-collar workers fear for the future and fight to retain old ways, regardless of the consequences to society or the environment. Finally some under skilled or untrained workers have been driven from their jobs or excluded from employment altogether: Their efforts to keep hope alive are often overwhelmed by despair. More >>