Socialist economics

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Socialist economics comprises the economic theories, practices and norms of hypothetical and existing socialist economic systems. A socialist economic system is characterized by social ownership and operation of the means of production that may take the form of autonomous cooperatives or direct public ownership wherein production is carried out directly for use rather than for profit. Socialist systems that utilize markets for allocating capital goods and factors of production among economic units are designated market socialism. When planning is utilized, the economic system is designated as a socialist planned economy. Non-market forms of socialism usually include a system of accounting based on calculation-in-kind to value resources and goods.

Socialist economics has been associated with different schools of economic thought. Marxian economics provided a foundation for socialism based on analysis of capitalism while neoclassical economics and evolutionary economics provided comprehensive models of socialism. During the 20th century, proposals and models for both socialist planned and market economies were based heavily on neoclassical economics or a synthesis of neoclassical economics with Marxian or institutional economics.

As a term, socialist economics may also be applied to the analysis of former and existing economic systems that were implemented in socialist states such as in the works of Hungarian economist János Kornai. 19th-century American individualist anarchist Benjamin Tucker, who connected the classical economics of Adam Smith and the Ricardian socialists as well as that of Pierre-Joseph Proudhon, Karl Marx and Josiah Warren to socialism, held that there were two schools of socialist thought, namely anarchist socialism and state socialism, maintaining that what they had in common was the labor theory of value. Socialists disagree about the degree to which social control or regulation of the economy is necessary; how far society should intervene and whether government, particularly existing government, is the correct vehicle for change are issues of disagreement. The goal of socialist economics is to neutralize capital, or in the case of market socialism to subject investment and capital to social planning.

History of socialist economic thought

Main article: History of socialism

Karl Marx and Friedrich Engels believed that hunter-gatherer societies and some primitive agricultural societies were communal, and called this primitive communism. Engels wrote about this at length in the book The Origin of the Family, Private Property and the State, which was based on the unpublished notes of Marx on the work of Lewis Henry Morgan.

Values of socialism have roots in pre-capitalist institutions such as the religious communes, reciprocal obligations and communal charity of medieval Europe, the development of its economic theory primarily reflects and responds to the monumental changes brought about by the dissolution of feudalism and the emergence of specifically capitalist social relations. As such it is commonly regarded as a movement belonging to the modern era. Many socialists have considered their advocacy as the preservation and extension of the radical humanist ideas expressed in Enlightenment doctrine such as Jean-Jacques Rousseau's Discourse on Inequality, Wilhelm von Humboldt's Limits of State Action, or Immanuel Kant's insistent defense of the French Revolution.

Capitalism appeared in mature form as a result of the problems raised when an industrial factory system requiring long-term investment and entailing corresponding risks was introduced into an internationalized commercial (mercantilist) framework. Historically speaking, the most pressing needs of this new system were an assured supply of the elements of industry (land, elaborate machinery, and labour) and these imperatives led to the commodification of these elements.

According to influential socialist economic historian Karl Polanyi's classic account, the forceful transformation of land, money and especially labour into commodities to be allocated by an autonomous market mechanism was an alien and inhuman rupture of the pre-existing social fabric. Marx had viewed the process in a similar light, referring to it as part of the process of "primitive accumulation" whereby enough initial capital is amassed to begin capitalist production. The dislocation that Polyani and others describe, triggered natural counter-movements in efforts to re-embed the economy in society. These counter-movements, that included, for example, the Luddite rebellions, are the incipient socialist movements. Over time such movements gave birth to or acquired an array of intellectual defenders who attempted to develop their ideas in theory.

As Polanyi noted, these counter-movements were mostly reactive and therefore not full-fledged socialist movements. Some demands went no further than a wish to mitigate the capitalist market's worst effects. Later, a full socialist program developed, arguing for systemic transformation. Its theorists believed that even if markets and private property could be tamed so as not to be excessively "exploitative", or crises could be effectively mitigated, capitalist social relations would remain significantly unjust and anti-democratic, suppressing universal human needs for fulfilling, empowering and creative work, diversity and solidarity.

Within this context, socialism has undergone four periods: the first in the 19th century was a period of utopian visions (1780s–1850s); then occurred the rise of revolutionary socialist and communist movements in the 19th century as the primary opposition to the rise of corporations and industrialization (1830–1916); the polarisation of socialism around the question of the Soviet Union and adoption of socialist or social democratic policies in response (1916–1989); and the response of socialism in the neoliberal era (1970s–present). As socialism developed, so did the socialist system of economics.

Socialist political economy before Marx

Charles Fourier, influential early French socialist thinker

A key early socialist theorist of political economy was Pierre-Joseph Proudhon. He was the most well-known of nineteenth century mutualist theorists and the first thinker to refer to himself as an anarchist. Others were: Technocrats like Henri de Saint-Simon, agrarian radicals like Thomas Spence, William Ogilvie and William Cobbett; anti-capitalists like Thomas Hodgskin; communitarian and utopian socialists like Robert Owen, William Thompson and Charles Fourier; anti-market socialists like John Gray and John Francis Bray; the Christian mutualist William Batchelder Greene; as well as the theorists of the Chartist movement and early proponents of syndicalism.

The first advocates of socialism promoted social leveling in order to create a meritocratic or technocratic society based upon individual talent. Count Henri de Saint-Simon was the first individual to coin the term "socialism". Saint-Simon was fascinated by the enormous potential of science and technology, which led him to advocate a socialist society that would eliminate the disorderly aspects of capitalism and which would be based upon equal opportunities. Saint-Simon advocated a society in which people were ranked according to their capacities and rewarded according to their work. This was accompanied by a desire to implement a rationally organized economy based on planning and geared towards large-scale scientific and material progress, which embodied a desire for a semi-planned economy.

Other early socialist thinkers were influenced by the classical economists. The Ricardian socialists, such as Thomas Hodgskin and Charles Hall, were based on the work of David Ricardo and reasoned that the equilibrium value of commodities approximated producer prices when those commodities were in elastic supply, and that these producer prices corresponded to the embodied labor. The Ricardian socialists viewed profit, interest and rent as deductions from this exchange-value.

Karl Marx and Das Kapital

Main article: Das Kapital

Karl Marx, influential German socialist thinker and economist

Karl Marx's approach, which Friedrich Engels would call "scientific socialism", would stand as the branching point in economic theory. In one direction went those who rejected the capitalist system as fundamentally anti-social, arguing that it could never be harnessed to effectively realize the fullest development of human potentialities wherein "the free development of each is the condition for the free development of all".

Marx's Das Kapital is an incomplete work of economic theory; he had planned four volumes but completed two and left his collaborator Engels to complete the third. In many ways, the work is modelled on Smith's Wealth of Nations, seeking to be a comprehensive logical description of production, consumption, and finance in relation to morality and the state. The work of philosophy, anthropology, sociology, and economics includes the following topics:

• Law of value: capitalist production is the production of "an immense multitude of commodities" or generalised commodity production. A commodity has two essential qualities firstly, they are useful, they satisfy some human want, "the nature of such wants, whether, for instance, they spring from the stomach or from fancy, makes no difference" and secondly they are sold on a market or exchanged. Critically the exchange value of a commodity "is independent of the amount of labour required to appropriate its useful qualities". However, rather depends on the amount of socially necessary labour required to produce it. All commodities are sold at their value, so the origin of the capitalist profit is not in cheating or theft, but in the fact that the cost of reproduction of labour power, or the worker's wage, is less than the value created during their time at work, enabling the capitalists to yield a surplus value or profit on their investments.
• Historical property relations: historical capitalism represents a process of momentous social upheaval where rural masses were separated from the land and ownership of the means of production by force, deprivation, and legal manipulation, creating an urban proletariat based on the institution of wage-labour. Moreover, capitalist property relations aggravated the artificial separation between city and country, which is a key factor in accounting for the metabolic rift between human beings in capitalism and their natural environment, which is at the root of our current ecological dilemmas.
• Commodity fetishism: Marx adapted previous value-theory to show that in capitalism phenomena involved with the price system (markets, competition, supply and demand) constitute a powerful ideology that obscures the underlying social relations of capitalist society. "Commodity fetishism" refers to this distortion of appearance. The underlying social reality is one of economic exploitation.
• Economic exploitation: workers are the fundamental creative source of new value. Property relations affording the right of usufruct and despotic control of the workplace to capitalists are the devices by which the surplus value created by workers is appropriated by the capitalists.
• Capital accumulation: inherent to capitalism is the incessant drive to accumulate as a response to the competitive forces acting upon all capitalists. In such a context the accumulated wealth which is the source of the capitalist's social power derives itself from being able to repeat the circuit of money→commodity→money, where the capitalist receives an increment or "surplus value" higher than their initial investment, as rapidly and efficiently as possible. Moreover, this driving imperative leads capitalism to its expansion on a worldwide scale.
• Crises: Marx identified natural and historically specific (i.e. structural) barriers to accumulation that were interrelated and interpenetrated one another in times of crises. Different types of crises, such as realization crises and overproduction crises, are expressions of capitalism's inability to constructively overcome such barriers. Moreover, the upshot of crises is increased centralization, the expropriation of the many capitalists by the few.
• Centralization: the interacting forces of competition, endemic crises, intensive and extensive expansion of the scale of production, and a growing interdependency with the state apparatus, all promote a strong developmental tendency towards the centralization of capital.
• Material development: as a result of its constant drive to optimize profitability by increasing the productivity of labour, typically by revolutionizing technology and production techniques, capitalism develops so as to progressively reduce the objective need for work, suggesting the potential for a new era of creative forms of work and expanded scope for leisure.
• Socialization and the pre-conditions for social revolution: by socializing the labour process, concentrating workers into urban settings in large-scale production processes and linking them in a worldwide market, the agents of a potential revolutionary change are created. Thus Marx felt that in the course of its development capitalism was at the same time developing the preconditions for its own negation. However, although the objective conditions for change are generated by the capitalist system itself, the subjective conditions for social revolution can only come about through the apprehension of the objective circumstances by the agents themselves and the transformation of such understanding into an effective revolutionary program.

Anarchist economics

Main article: Anarchist economics

Anarchist economics is the set of theories and practices of economics and economic activity within the political philosophy of anarchism.

Pierre Joseph Proudhon was involved with the Lyons mutualists and later adopted the name to describe his own teachings. Mutualism is an anarchist school of thought that originates in the writings of Pierre-Joseph Proudhon, who envisioned a society where each person might possess a means of production, either individually or collectively, with trade representing equivalent amounts of labor in the free market. Integral to the scheme was the establishment of a mutual-credit bank that would lend to producers at a minimal interest rate, just high enough to cover administration. Mutualism is based on a labor theory of value that holds that when labor or its product is sold, in exchange, it ought to receive goods or services embodying "the amount of labor necessary to produce an article of exactly similar and equal utility".

The Conquest of Bread by Peter Kropotkin, influential work which presents the economic vision of anarcho-communism

Collectivist anarchism is a revolutionary doctrine that advocates the abolition of the state and private ownership of the means of production. Instead, it envisions the means of production being owned collectively and controlled and managed by the producers themselves. Once collectivization takes place, workers' salaries would be determined in democratic organizations based on the amount of time they contributed to production. These salaries would be used to purchase goods in a communal market.

Anarcho-communism is a theory of anarchism which advocates the abolition of the state, private property, and capitalism in favor of common ownership of the means of production, direct democracy and a horizontal network of voluntary associations, and workers' councils with production and consumption based on the guiding principle: "from each according to ability, to each according to need". Unlike mutualism, collectivist anarchism and Marxism, anarcho-communism as defended by Peter Kropotkin and Errico Malatesta rejected the labor theory of value altogether, instead advocating a gift economy and to base distribution on need. As a coherent, modern economic-political philosophy, anarcho-communism was first formulated in the Italian section of the First International by Carlo Cafiero, Emilio Covelli, Errico Malatesta, Andrea Costa, and other ex-Mazzinian Republicans. Out of respect for Mikhail Bakunin, they did not make their differences with collectivist anarchism explicit until after Bakunin's death.

Left-wing market anarchism strongly affirm the classical liberal ideas of self-ownership and free markets, while maintaining that, taken to their logical conclusions, these ideas support strongly anti-corporatist, anti-hierarchical, pro-labor positions and anti-capitalism in economics and anti-imperialism in foreign policy.

Immanuel Wallerstein

In 1979, Immanuel Wallerstein wrote:

There are today no socialist systems in the world-economy any more than there are feudal systems because there is only one world-system. It is a world-economy and it is by definition capitalist in form. Socialism involves the creation of a new kind of world-system, neither a redistributive world-empire nor a capitalist world-economy but a socialist world-government. I don't see this projection as being in the least utopian but I also don't feel its institution is imminent. It will be the outcome of a long social struggle in forms that may be familiar and perhaps in very few forms, that will take place in all the areas of the world-economy.

Characteristics

See also: Socialist mode of production

A socialist economy is a system of production where goods and services are produced directly for use, in contrast to a capitalist economic system, where goods and services are produced to generate profit (and therefore indirectly for use). "Production under socialism would be directly and solely for use. With the natural and technical resources of the world held in common and controlled democratically, the sole object of production would be to meet human needs." Goods and services would be produced for their usefulness, or for their use-value, eliminating the need for market-induced needs to ensure a sufficient amount of demand for products to be sold at a profit. Production in a socialist economy is therefore "planned" or "coordinated", and does not suffer from the business cycle inherent to capitalism. In most socialist theories, economic planning only applies to the factors of production and not to the allocation of goods and services produced for consumption, which would be distributed through a market. Karl Marx stated that "lower-stage communism" would consist of compensation based on the amount of labor one contributes to the social product.

The ownership of the means of production varies in different socialist theories. It can either be based on public ownership by a state apparatus; direct ownership by the users of the productive property through worker cooperative; or commonly owned by all of society with management and control delegated to those who operate/use the means of production.

Management and control over the activities of enterprises is based on self-management and self-governance, with equal power-relations in the workplace to maximize occupational autonomy. A socialist form of organization would eliminate controlling hierarchies so that only a hierarchy based on technical knowledge in the workplace remains. Every member would have decision-making power in the firm and would be able to participate in establishing its overall policy objectives. The policies/goals would be carried out by the technical specialists that form the coordinating hierarchy of the firm, who would establish plans or directives for the work community to accomplish these goals.

However, the economies of the former Socialist states, excluding Yugoslavia, were based on bureaucratic, top-down administration of economic directives and micromanagement of the worker in the workplace inspired by capitalist models of scientific management. As a result, some socialist movements have argued that said economies were not socialist due to the lack of equal power-relations in the workplace, the presence of a new "elite", and because of the commodity production that took place in these economies. These economic and social systems have been classified as being either "bureaucratic collectivist", "state capitalist" or "deformed workers' states" by its critics. The exact nature of the USSR et al. remains unresolved within said socialist movements. However, other socialist movements defend the systems that were in place in Eastern Europe and the Soviet Union, remembering, as said above, that public ownership of the means of production can signify many variants. In the case of the Soviet Union and its satellites, it was the State which controlled and managed almost all of the economy as a single huge enterprise. Furthermore, the products that were manufactured in Soviet-type economies were not produced directly for use, given the fact that all of them were sold to the public at below-market prices (i.e. they were sold in deficit to satisfy the needs of the population).

Albert Einstein advocated for a socialist planned economy with his 1949 article "Why Socialism?"

In the May 1949 issue of the Monthly Review titled "Why Socialism?", Albert Einstein wrote:

I am convinced there is only one way to eliminate (the) grave evils (of capitalism), namely through the establishment of a socialist economy, accompanied by an educational system which would be oriented toward social goals. In such an economy, the means of production are owned by society itself and are utilized in a planned fashion. A planned economy, which adjusts production to the needs of the community, would distribute the work to be done among all those able to work and would guarantee a livelihood to every man, woman, and child. The education of the individual, in addition to promoting his own innate abilities, would attempt to develop in him a sense of responsibility for his fellow-men in place of the glorification of power and success in our present society.

Economic planning

Main articles: Economic planning and Planned economy

Project Cybersyn was an early form of computational economic planning.

Leon Trotsky was among the earliest Soviet figures that supported economic planning and decentralization but opposed the Stalinist model.

Economic planning is a mechanism for the allocation of economic inputs and decision-making based on direct allocation, in contrast to the market mechanism, which is based on indirect allocation.

Economic planning is not synonymous with the concept of a command economy, which existed in the Soviet Union, and was based on a highly bureaucratic administration of the entire economy in accordance to a comprehensive plan formulated by a central planning agency, which specified output requirements for productive units and tried to micromanage the decisions and policies of enterprises. The command economy is based on the organizational model of a capitalist firm, but applies it to the entire economy.

Various advocates of economic planning have been staunch critics of command economies and centralized planning. For example, Leon Trotsky believed that central planners, regardless of their intellectual capacity, operated without the input and participation of the millions of people who participate in the economy and understand the local conditions and rapid changes in the economy. Therefore, central planners would be unable to effectively coordinate all economic activity because they lacked this informal information.

Economic value theories

Socialist economic theories base the value of a good or service on its use value, rather than its cost of production (labor theory of value) or its exchange value (marginal utility). Other socialist theories, such as mutualism and market socialism, attempt to apply the labor theory of value to socialism, so that the price of a good or service is adjusted to equal the amount of labor time expended in its production. The labor-time expended by each worker would correspond to labor credits, which would be used as a currency to acquire goods and services. Market socialists that base their models on neoclassical economics, and thus marginal utility, such as Oskar Lange and Abba Lerner, have proposed that publicly owned enterprises set their price to equal marginal cost, thereby achieving pareto efficiency. Anarcho-communism as defended by Peter Kropotkin and Errico Malatesta rejected the labor theory of value and exchange value itself, advocated a gift economy and to base distribution on need.

Economic models and systems

See also: Types of socialism

Robin Hahnel and Michael Albert identify five different economic models within socialist economics:

• Public enterprise centrally planned economy in which all property is owned by the state and all key economic decisions are made centrally by the state, e.g. the former Soviet Union.
• Public enterprise state-managed market economy, one form of market socialism which attempts to use the price mechanism to increase economic efficiency while all decisive productive assets remain in the ownership of the state, e.g. the socialist market economy in China and the socialist-oriented market economy in Vietnam after reforms.
• A mixed economy, where public and private ownership are mixed and industrial planning is ultimately subordinate to market allocation, e.g. the model generally adopted by social democrats in the 20th century such as in Sweden. Many different proposals for socialist economic systems call for a type of mixed economy, where multiple forms of ownership over the means of production co-exist with one another. Alternatively, a mixed economy may also be a socialist economy that allows a substantial role for private enterprise and contracting within a dominant economic framework of public ownership. This can extend to Soviet-type planned economies that have been reformed to incorporate a greater role for markets in the allocation of factors of production.
• Public enterprise employee managed market economies, another form of market socialism in which publicly owned, employee-managed production units engage in free-market exchanges of goods and services with one another as well as with final consumers, e.g. mid-20th-century Yugoslavia. Two more theoretical models are Prabhat Ranjan Sarkar's progressive utilization theory and economic democracy.
• Public enterprise participatory planning, an economy featuring social ownership of the means of production with allocation based on an integration of decentralized democratic planning, e.g. stateless communism and libertarian socialism. An incipient historical forebear is that of Catalonia during the Spanish Revolution. More developed theoretical models include those of Karl Polanyi, participatory economics, Inclusive Democracy and the negotiated coordination model of Pat Devine as well as in Cornelius Castoriadis's pamphlet "Workers' Councils and the Economics of a Self-Managed Society".

János Kornai identifies five distinct types of socialism:

• Classical and Marxist conception, where socialism is a stage of economic development in which wage labour, private property in the means of production and monetary relations have been made redundant through the development of the productive forces, so that capital accumulation has been superseded by economic planning. Economic planning in this definition means conscious allocation of economic inputs and the means of production by the associated producers to directly maximise use-values as opposed to exchange-values, in contrast to the "anarchy of production" of capitalism.
• Walrasian and market socialist which defines socialism as public-ownership or cooperative-enterprises in a market economy, with prices for producer goods set through a trial-and-error method by a central planning board. In this view, socialism is defined in terms of de jure public property rights over major enterprises.
• Marxist–Leninist conception which includes a form of political organisation based on control of the means of production and government by a single political party apparatus that claims to act in the interest of the working class and an ideology hostile toward markets and political dissent, with coordination of economic activity through centralised economic planning, e.g. a command economy in the form of an administrative-command system.
• Social-democratic concept based on the capitalist mode of production which defines socialism as a set of values rather than a specific type of social and economic organisation. It includes unconditional support for parliamentary democracy, gradual and reformist attempts to establish socialism and support for socially progressive causes. Social democrats are not opposed to the market or private property and instead they try to ameliorate the effects of capitalism through a welfare state which relies on the market as the fundamental coordinating entity in the economy and a degree of public ownership/public provision of public goods in an economy otherwise dominated by private enterprise.
• East Asian model, or socialist market economy, based on a largely free-market, capital accumulation for profit and substantial private ownership along with state-ownership of strategic industries monopolised by a single political party. János Kornai ultimately leaves the classification of this model (as either socialist or capitalist) to the reader.

Socialism can be divided into market socialism and planned socialism based on their dominant mechanism of resource allocation. Another distinction can be made between the type of property structures of different socialist systems (public, cooperative or common) and on the dominant form of economic management within the economy (hierarchical or self-managed).

Economic democracy

Economic democracy is a model of market socialism primarily developed by the American economist David Schweickart. In Schweickart's model, enterprises and natural resources are owned by society in the form of public banking, and management is elected by the workers within each firm. Profits would be distributed among the workers of the respective enterprise.

Self-managed economy

The self-managed economy is a form of socialism where enterprises are owned and managed by their employees, effectively negating the employer-employee (or wage labor) dynamic of capitalism and emphasizing the opposition to alienation, self-managing and cooperative aspect of socialism. Members of cooperative firms are relatively free to manage their own affairs and work schedules. This model was developed most extensively by the Yugoslav economists Branko Horvat, Jaroslav Vanek and the American economist Benjamin Ward.

Worker self-directed enterprise

Worker self-directed enterprise is a recent proposal advocated by the American Marxian economist Richard D. Wolff. This model shares many similarities with the model of socialist self-management in that employees own and direct their enterprises, but places a greater role on democratically elected management within a market economy.

Democratic planned socialism

Democratic planned socialism is a form of decentralized planned economy.

Feasible socialism

Feasible socialism was the name Alec Nove gave his outline for socialism in his work The Economics of Feasible Socialism. According to Nove, this model of socialism is "feasible" because it can be realized within the lifetime of anyone living today. It involves a combination of publicly owned and centrally directed enterprises for large-scale industries, autonomous publicly owned enterprises, consumer and worker-owned cooperatives for the majority of the economy, and private ownership for small businesses. It is a market-based mixed economy that includes a substantial role for macroeconomic interventionism and indicative economic planning.

Pragmatic market socialism

The American economist James Yunker detailed a model where social ownership of the means of production is achieved the same way private ownership is achieved in modern capitalism through the shareholder system that separates management functions from ownership. Yunker posits that social ownership can be achieved by having a public body, designated the Bureau of Public Ownership (BPO), owning the shares of publicly listed firms without affecting market-based allocation of capital inputs. Yunker termed this model pragmatic market socialism because it does not require massive changes to society and would leave the existing management system intact, and would be at least as efficient as modern-day capitalism while providing superior social outcomes as public ownership of large and established enterprises would enable profits to be distributed among the entire population in a social dividend rather than going largely to a class of inheriting rentiers.

Participatory economy

Participatory economics utilizes participatory decision making as an economic mechanism to guide the production, consumption and allocation of resources in a given society.

Computer-managed allocation

See also: Cybersyn, OGAS, and Towards a New Socialism

Proposals for utilizing computer-based coordination and information technology for the coordination and optimization of resource allocation (also known as cybernetics) within an economy have been outlined by various socialists, economists and computer scientists, including Oskar Lange, the Soviet engineer Viktor Glushkov, and more recently Paul Cockshott and Allin Cottrell.

Peer-to-peer economy and open source

The "networked information age" has enabled the development and emergence of new forms of organizing the production of value in non-market arrangements that have been termed commons-based peer production along with the negation of ownership and the concept of property in the development of software in the form of open source and open design.

Negotiated coordination

Economist Pat Devine has created a model of coordination called "negotiated coordination", which is based upon social ownership by those affected by the use of the assets involved, with decisions made by those at the most localised level of production.

Elements of socialism in practice

Centrally planned economies

A centrally planned economy combines public ownership of the means of production with centralized state planning. This model is usually associated with the Soviet-type command economy. In a centrally planned economy, decisions regarding the quantity of goods and services to be produced are planned in advance by a planning agency. In the early years of Soviet central planning, the planning process was based upon a selected number of physical flows with inputs mobilized to meet explicit production targets measured in natural or technical units. This material balances method of achieving plan coherence was later complemented and replaced by value planning, with money provided to enterprises so that they could recruit labour and procure materials and intermediate production goods and services. The Soviet economy was brought to balance by the interlocking of three sets of calculation, namely the setting up of a model incorporating balances of production, manpower and finance. The exercise was undertaken annually and involved a process of iteration (the "method of successive approximation"). Although nominally a "centrally planned" economy, in reality formulation of the plan took place on a more local level of the production process as information was relayed from enterprises to planning ministries. Aside from the Soviet Union and Eastern Bloc economies, this economic model was also utilized by the People's Republic of China, Socialist Republic of Vietnam, Republic of Cuba and North Korea.

Soviet Union

Main article: Economy of the Soviet Union

See also: Five-year plans of the Soviet Union, Gosplan, and Ministry of Finance (Soviet Union)

The Soviet Union and some of its European satellites aimed for a fully centrally-planned economy. While they dispensed almost entirely with private ownership over the means of production, workers still effectively received a wage for their labour. Some believe that according to Marxist theory this should have been a step towards a genuine workers' state. However, some Marxists consider this a misunderstanding of Marx's views on historical materialism and of his views on the process of socialization.

Characteristics of the Soviet economic model included:

• production quotas for every productive unit. A farm, mine or factory was judged on the basis of whether its production met the quota. It would be provided with a quota of the inputs it needed to start production, and then its quota of output would be taken away and given to downstream production units or distributed to consumers.
• allocation through political control. In contrast with systems where prices determined allocation of resources, the Soviet bureaucracy determined allocation, particularly of the means of production. The prices that were constructed were determined after the formulation of the economy plan, and such prices did not factor into choices about what was produced and how it was produced in the first place.
• full employment. Every worker was ensured employment. However workers were generally not directed to jobs. The central-planning administration adjusted relative wages rates to influence job choice in accordance with the outlines of the current plan.
• clearing goods by planning: if a surplus of a product accumulated, then the central planning authority would either reduce the quota for its production or increase the quota for its use.
• five-year plans for the long-term development of key industries.

The planning system in the Soviet Union developed under Stalin between 1928 and 1934. According to historian Sheila Fitzpatrick, the scholarly consensus was that Stalin appropriated the position of the Left Opposition on such matters as industrialisation and collectivisation. After the end of the Second World War in 1945, the seven countries with communist governments in Central and Eastern Europe introduced central planning with five- (or six-) year plans on the Soviet model by 1951. The common features included the nationalization of industry, transport and trade, compulsory procurement in farming (but not collectivization) and government monopolies on foreign trade. Prices were largely determined on the basis of the costs of inputs, a method derived from the labour theory of value. Prices did not therefore incentivize production enterprises, whose inputs were instead purposely rationed by the central plan. This "taut planning" began around 1930 in the Soviet Union and only became attenuated after the economic reforms in 1966–1968, when enterprises were encouraged to make profits.

According to communist doctrine, planning had the stated purpose of enabling the people - through the communist party and state institutions - to undertake activities that would have been frustrated by a market economy, including the rapid expansion of universal education and health care, urban development with mass good-quality housing, and industrial development of all regions of the country. Nevertheless, markets continued to exist in Soviet-type planned economies. Even after the collectivization of agriculture in the Soviet Union in the 1930s, members of collective farms and anyone with a private garden plot were free to sell their own produce (farm workers were often paid in kind). Licensed markets operated in every town and city borough where non-state-owned enterprises (such as cooperatives and collective farms) were able to offer their products and services. From 1956 and 1959 onwards, all wartime controls over manpower were removed and people could apply for and quit jobs freely in the Soviet Union. The use of market mechanisms went furthest in Yugoslavia, Czechoslovakia and Hungary. From 1975, Soviet citizens had the right to engage in private handicraft; collective farmers could raise and sell livestock privately from 1981. Households were free to dispose of their income as they chose, and incomes were lightly taxed.

Historian Robert Vincent Daniels regarded the Stalinist period to represent an abrupt break with Lenin's government in terms of economic planning in which an deliberated, scientific system of planning that featured former Menshevik economists at Gosplan had been replaced with a hasty version of planning with unrealistic targets, bureaucratic waste, bottlenecks and shortages. Stalin's formulations of national plans in terms of physical quantity of output was also attributed by Daniels as a source for the stagnant levels of efficiency and quality.

Dispute that the Soviet model is socialism

Various scholars and political economists have criticized the claim that the centrally-planned economy - and specifically the Soviet model of economic development - constitutes a form of socialism. They argue that the Soviet economy was structured upon the accumulation of capital and the extraction of surplus value from the working class by the planning agency in order to reinvest this surplus into the economy and to distribute to managers and senior officials, indicating the Soviet Union and other Soviet-style economies were state-capitalist and unplanned administrative-command economies. More fundamentally, these economies were structured around the dynamic of capitalism, i.e. the accumulation of capital, production for profit (as opposed to being based on production for use—the defining criterion for socialism) and the law of value, having not yet transcended the system of capitalism, but being in fact a variation of capitalism based on a process of state-directed accumulation.

On the other side of the argument, economists contend that no surplus value was generated from labour activity or from commodity markets in the socialist planned economies; they therefore claim that there was no exploiting class, even if inequalities existed. Since prices were controlled and set below market-clearing levels, there was no element of value added at the point of sale - as occurs in capitalist market economies. Prices were built up from the average cost of inputs, including wages, taxes, interest on stocks and working capital as well as allowances to cover the recoupment of investment and for depreciation, so there was no profit margin in the price charged to customers. Wages did not reflect the purchase price of labour, since labour was not a commodity traded in a market and the employing organizations did not own the means of production. Wages were set at a level that permitted a decent standard of living; they rewarded specialist skills and educational qualifications. In macroeconomic terms, the plan allocated the whole national product to workers in the form of wages for the workers' own use, with a fraction withheld for investment and for imports from abroad. The difference between the average value of wages and the value of national output per worker did not imply the existence of surplus value since it was part of a consciously formulated plan for the development of society. The presence of inequality in the socialist planned economies did not imply that an exploiting class existed. In the Soviet Union, communist-party members were able to buy scarce goods in special shops and the leadership elite took advantage of state property to live in more spacious accommodation - and sometimes in luxury. Although they received privileges not commonly available and some additional income in kind, there was no difference in their official remuneration in comparison to their non-party peers. Enterprise managers and workers received only the wages and bonuses related to the production targets that the planning authorities had set. Outside of the cooperative sector - which enjoyed greater economic freedoms and whose profits were shared among all members of the cooperative - there was no profit-taking class. Other analysts maintain that workers in the Soviet Union and in other Marxist–Leninist states had genuine control over the means of production through institutions such as trade unions.

Some socialist critics point to the lack of socialist social relations in Soviet-style economies (specifically the lack of self-management), to a bureaucratic elite based on hierarchical and centralized powers of authority as well as to the lack of genuine worker control over the means of production. Such factors lead them to conclude that Soviet economies were not socialist, but examples either of bureaucratic collectivism or of state capitalism. Trotskyists regard mature Soviet systems as neither socialist nor capitalist—but as deformed workers' states. This analysis is consistent with the April Theses of 1917, in which Lenin stated that the prospective Bolshevik revolution aimed not to introduce socialism (which could only be established on a worldwide scale), but to bring production and the state under the control of the Soviets of Workers' Deputies. Trotsky himself would weigh the material benefits and challenges associated with the adoption of the New Economic Policy for the early Soviet Union in his work, Towards Socialism or Capitalism?. Furthermore, communist states often do not claim to have achieved socialism in their countries; on the contrary, they claim to be building and working toward the establishment of socialism in their countries. For example, the preamble to the Socialist Republic of Vietnam's constitution states that Vietnam only entered a transition stage between capitalism and socialism after the country was re-unified under the Communist party in 1976, and the 1992 Constitution of the Republic of Cuba states that the role of the Communist Party is to "guide the common effort toward the goals and construction of socialism".

Stalinists and their followers challenge this view - they claim that socialism was established in the Soviet Union after Joseph Stalin came to power in the late 1920s and instituted the system of five-year plans in 1928. The 1936 Constitution of the Soviet Union, known as the Fundamental Law of Victorious Socialism, embodied the claim that the foundations for socialism had been laid. In 1924 Stalin introduced the theory of socialism in one country, which argued that socialism can be built in a single country, despite existing within a global capitalist economic system. Nevertheless, the Soviet orthodoxy held that the stage during which developed socialism would be built would be a lengthy one and would not be achieved by the Soviet Union on its own. According to the official textbooks, the first stage of the transition period from capitalism to socialism had been completed by the 1970s in the European socialist countries (except Poland and Yugoslavia) and in Mongolia and Cuba. The next stage of developed socialism would not be reached until "the economic integration of the socialist states becomes a major factor of their economic progress" and social relations had been reconstructed on "collectivist principles". Communist writers accepted that during the earlier stages in constructing socialism the exchange of commodities on the basis of the average socially necessary labour embodied within them occurred and involved the mediation of money. Socialist planned economies were systems of commodity production, but this was directed in a conscious way towards meeting the needs of the people and not left to the "anarchy of the market". At the stage of developed socialism, "the state of dictatorship of the proletariat changes into a state of all people reflecting the increasing homogeneity of society" and the "evening out of economic development levels" within and between socialist countries. It would provide the foundations for a further stage of perfected socialist society, where an abundance of goods permitted their distribution according to need. Only then could the world socialist system progress towards the higher phase of communism.

World socialist economic system

By the 1980s, the world economic socialist system embraced one-third of the world's population but generated no more than 15 percent of global economic output. At its height in the mid-1980s, the world socialist system could be said to comprise the following countries with a "socialist orientation", though not all were allies of the Soviet Union: Afghanistan, Albania, Angola, Bulgaria, Cambodia, China, Cuba, Czechoslovakia, Eastern Germany, Ethiopia, Hungary, Mozambique, Nicaragua, North Korea, Laos, Mongolia, Poland, Romania, Vietnam, South Yemen, Yugoslavia and the Soviet Union. The system co-existed alongside the world capitalist system but was founded upon the principles of cooperation and mutual assistance rather than upon competition and rivalry. The countries involved aimed to even-out the level of economic development and to play an equal part in the international division of labour. An important role was played by the Council for Mutual Economic Assistance (CMEA) or Comecon, an international body set up to promote economic development. It involved joint planning activity, the establishment of international economic, scientific and technical bodies and methods of cooperation between state agencies and enterprises, including joint ventures and projects. Allied to the CMEA were the International Development Bank, established in 1971; and the International Bank for Economic Cooperation, founded in 1963, which had their counterparts in the World Bank, the Bank for International Settlements and the International Monetary Fund in the non-socialist world.

The main tasks of the CMEA were plan coordination, production specialization and regional trade. In 1961 Nikita Khrushchev, the Soviet leader, put forward proposals for establishing an integrated, centrally-planned socialist commonwealth in which each geographic region would specialize production in line with its set of natural and human resources. The resulting document, the "Basic Principles of the International Socialist Division of Labour" was adopted at the end of 1961, despite objections from Romania on certain aspects. The "Basic Principles" were never implemented fully and were replaced in 1971 by the adoption of the "Comprehensive Programme for Further Extension and Improvement of Cooperation and Development of Socialist Economic Integration". As a result, many specialization agreements were made between CMEA member states for investment programmes and projects. The importing country pledged to rely on the exporting country for its consumption of the product in question. Production specialization occurred in engineering, automotive, chemicals, computers and automation, telecommunications and biotechnology. Scientific and technical cooperation between CMEA member states was facilitated by the establishment in 1969 of the International Centre for Scientific and Technical Information in Moscow.

Trade between CMEA member states was divided into "hard goods" and "soft goods". The former could be sold on world markets and the latter could not. Commodities such as food, energy products and raw materials tended to be hard goods and were traded within the CMEA area at world market prices. Manufactures tended to be soft goods—their prices were negotiable and often adjusted to make bilateral payment flows balance.

Other countries with privileged affiliation with the CMEA included Algeria, Benin, Burma, Congo, Finland, Madagascar, Mali, Mexico, Nigeria, Seychelles, Syria, Tanzania and Zimbabwe. The Soviet Union also provided substantial economic aid and technical assistance to developing countries including Egypt, India, Iraq, Iran, Somalia and Turkey. It supported developing countries in calling for a New International Economic Order and backed the UN Charter of Economic Rights and Obligations of States adopted by the General Assembly in 1974.

Achievements of the socialist planned economies

In the officially sanctioned textbooks describing the socialist planned economies as they existed in the 1980s, it was claimed as follows:

• Class and national oppression had been totally eradicated.
• Unemployment, hunger, poverty, illiteracy and uncertainty about the future had been eliminated.
• Every citizen had a guaranteed right to work, rest, education, health care, abode and security in old age and maintenance in the event of disability.
• Material standards of living were rising steadily and everyone had free access to knowledge and to the values of world and national culture.
• Every citizen had a right in practice to take part in discussing and solving any problems in the life of the enterprise, region, republic and the country they lived in, including the rights to free speech, of assembly and to demonstrate.

Data collected by the United Nations of indicators of human development in the early 1990s show that a high level of social development was achieved in the former socialist planned economies of Central and Eastern Europe and the Commonwealth of Independent States (CEE/CIS). Life expectancy in the CEE/CIS area in the period 1985–1990 was 68 years, while for the countries of the Organization for Economic Cooperation and Development (OECD) it was 75 years. Infant mortality in the CEE/CIS area was 25 for every 1,000 live births in 1990, compared to 13 in the OECD area. In terms of education, the two areas enjoyed universal adult literacy and full enrolment of children in primary and secondary schools. For tertiary education, the CEE/CIS had 2,600 university students per 100,000 population, while in the OECD the comparable figure was 3,550 students. Overall enrolment at primary, secondary and tertiary levels was 75 percent in the CEE/CIS region and 82 percent in the OECD countries.

On housing the main problem was over-crowding rather than homelessness in the socialist planned economies. In the USSR the area of residential accommodation was 15.5 square meters per person by 1990 in urban areas but 15 percent of the population were without their own separate accommodation and had to live in communal apartments according to the 1989 census. Housing was generally of good quality in both the CEE/CIS region and in the OECD countries: 98 and 99 percent of the population in the OECD countries had access to safe drinking water and improved sanitation respectively, compared to 93 and 85 percent in the CEE/CIS area by 1990.

Unemployment did not exist officially in the socialist planned economies, though there were people between jobs and a fraction of unemployable people as a result of illness, disability or other problems, such as alcoholism. The proportion of people changing jobs was between 6 and 13 percent of the labour force a year according to employment data during the 1970s and 1980s in Central and Eastern Europe and the USSR. Labour exchanges were established in the USSR in 1967 to help enterprises re-allocate workers and provide information on job vacancies. Compulsory unemployment insurance schemes operated in Bulgaria, Eastern Germany and Hungary but the numbers claiming support as a result of losing their job through no fault of their own numbered a few hundred a year.

By 1988, GDP per person, measured at purchasing power parity in US dollars, was $7,519 in Russia and $6,304 for the USSR. The highest income was to be found in Slovenia ($10,663) and Estonia ($9,078) and the lowest in Albania ($1,386) and Tajikistan ($2,730). Across the whole CEE/CIS area, GDP per person was estimated at $6,162. This compared to the US with $20,651 and $16,006 for Germany in the same year. For the OECD area as a whole estimated GDP per person was $14,385. Thus, on the basis of IMF estimates, national income (GDP) per person in the CEE/CIS area was 43 percent of that in the OECD area.

Economic problems of the socialist planned economies

From the 1960s onwards, CMEA countries, beginning with East Germany, attempted "intensive" growth strategies, aiming to raise the productivity of labour and capital. However, in practice this meant that investment was shifted towards new branches of industry, including the electronics, computing, automotive and nuclear power sectors, leaving the traditional heavy industries dependent upon older technologies. Despite the rhetoric about modernization, innovation remained weak as enterprise managers preferred routine production that was easier to plan and brought them predictable bonuses. Embargoes on high technology exports organized through the US-supported CoCom arrangement hampered technology transfer. Enterprise managers also ignored inducements to introduce labour-saving measures as they wished to retain a reserve of personnel to be available to meet their production target by working at top speed when supplies were delayed.

Under conditions of "taut planning", the economy was expected to produce a volume of output higher than the reported capacity of enterprises and there was no "slack" in the system. Enterprises faced a resource constraint and hoarded labour and other inputs and avoided sub-contracting intermediate production activities, preferring to retain the work in-house. The enterprise, according to the theory promulgated by János Kornai, was constrained by its resources not by the demand for its goods and services; nor was it constrained by its finances since the government was not likely to shut it down if it failed to meet its financial targets. Enterprises in socialist planned economies operated within a "soft" budget constraint, unlike enterprises in capitalist market economies which are demand-constrained and operate within "hard" budget constraints, as they face bankruptcy if their costs exceed their sales. As all producers were working in a resource-constrained economy they were perpetually in short supply and the shortages could never be eliminated, leading to chronic disruption of production schedules. The effect of this was to preserve a high level of employment.

As the supply of consumer goods failed to match rising incomes (because workers still received their pay even if they were not fully productive), household savings accumulated, indicating, in the official terminology, "postponed demand". Western economists called this "monetary overhang" or "repressed inflation". Prices on the black market were several times higher than in the official price-controlled outlets, reflecting the scarcity and possible illegality of the sale of these items. Therefore, although consumer welfare was reduced by shortages, the prices households paid for their regular consumption were lower than would have been the case had prices been set at market-clearing levels.

Over the course of the 1980s it became clear that the CMEA area was "in crisis", although it remained viable economically and was not expected to collapse. The "extensive" growth model was retarding growth in the CMEA as a whole, with member countries dependent upon supplies of raw materials from the USSR and upon the Soviet market for sales of goods. The decline in growth rates reflected a combination of diminishing returns to capital accumulation and low innovation as well as micro-economic inefficiencies, which a high rate of saving and investment was unable to counter. The CMEA was supposed to ensure coordination of national plans but it failed even to develop a common methodology for planning which could be adopted by its member states. As each member state was reluctant to give up national self-sufficiency the CMEA's efforts to encourage specialization was thwarted. There were very few joint ventures and therefore little intra-enterprise technology transfer and trade, which in the capitalist world was often undertaken by trans-national corporations. The International Bank for Economic Cooperation had no means of converting a country's trade surplus into an option to buy goods and services from other CMEA members.

Transition to market economies

After the dissolution of the Soviet Union and the Eastern Bloc, many of the remaining socialist states presiding over centrally planned economies began introducing reforms that shifted their economies away from centralized planning. In Central and Eastern Europe and the USSR the transition from a planned economy to a market economy was accompanied by the transformation of the socialist mode of production to a capitalist mode of production. In Asia (China, Laos, North Korea and Vietnam) and in Cuba market mechanisms were introduced by the ruling communist parties and the planning system was reformed without systemic transformation.

The transformation from socialism to capitalism involved a political shift: from a people's democracy (see People's Republic and Communist state) with a constitutionally entrenched "leading role" for the communist and workers' parties in society to a liberal representative democracy with a separation of legislative, executive and judicial authorities and centres of private power that can act as a brake on the state's activity.

Vietnam adopted an economic model it formally titled the socialist-oriented market economy. This economic system is a form of mixed-economy consisting of state, private, co-operative and individual enterprises coordinated by the market mechanism. This system is intended to be transitional stage in the development of socialism.

Transition economies

See also: Transition economy

The transformation of an economic system from a socialist planned economy to a capitalist market economy in Central and Eastern Europe, the former Soviet Union and Mongolia in the 1990s involved a series of institutional changes. These included:

• Control over the means of production was removed from the state through privatization and private property rights were re-established. In several countries property was restored to its former owners or their legal successors. If the actual property could not be returned the former owners received compensation. This occurred in Eastern Germany, Czechoslovakia, Hungary and Estonia. In all the countries of the Commonwealth of Independent States, the government decided against restoration or compensation on the grounds that too much time had elapsed and in many cases compensation had already been made through bilateral treaties between the USSR and foreign governments representing the former owners. Voucher privatization in which citizens and workers in the enterprises received free or cheap shares was undertaken in most of the transition economies.
• The decision-making system was de-centralized through the ending of central planning and the privatization of enterprises. Work collectives and trade unions lost much of their influence in enterprise decision-making.
• Markets became the dominant coordination mechanism following price liberalization and the de-control of foreign trade that permitted more or less unrestricted importation of goods in 1990/92. Queues at retail outlets disappeared as did hoarded inventories at factories. Stock exchanges were established between 1990 and 1995. Anti-monopoly legislation was introduced. As workers lost their jobs or found their wages unpaid, informal labour markets sprang up along certain streets, particularly for construction trades.
• The incentive system was modified by the legalization of private enterprise and alteration to employment laws. A large informal sphere developed estimated at comprising 21 to 30 percent of official calculations of GDP.
• The organizational forms prevailing in the socialist planned economies were restructured by breaking up vertically integrated industrial and agricultural concerns and closing non-viable undertakings. The hardening of enterprise budget constraints was more significant in driving industrial restructuring than privatization according to some studies.
• The distribution system became more unequal as price controls on necessities were removed fuelling the growth of poverty among people on fixed incomes such as pensioners and the unemployed. Redistributive measures through taxation and social safety nets proved unable to counteract the growth of poverty and, at the other end of the income scale, the emergence of a rich business elite (see also business oligarch).
• The public choice mechanism was overhauled to rescind the communist party's leading role and introduce a liberal constitution entrenching civil rights and representative democracy in almost all transition economies except Belarus, Turkmenistan and Uzbekistan.

People's Republic of China

Main articles: Economy of the People's Republic of China and Socialist market economy

China embraced a socialist planned economy after the Communist victory in its Civil War. Private property and private ownership of capital were abolished, and various forms of wealth made subject to state control or to workers' councils. The Chinese economy broadly adopted a similar system of production quotas and full employment by fiat to the Russian model. The Great Leap Forward saw a remarkably large-scale experiment with rapid collectivisation of agriculture and other ambitious goals. Results were less than expected (e.g. there were food shortages and mass starvation) and the program was abandoned after three years. In the common program set up by the Chinese People's Political Consultative Conference in 1949, in effect the country's interim constitution, state capitalism meant an economic system of corporatism. It provided as follows: "Whenever necessary and possible, private capital shall be encouraged to develop in the direction of state capitalism".

In recent decades, China has opened its economy to foreign investment and to market-based trade, and has continued to experience strong economic growth. It has carefully managed the transition from a socialist planned economy to a market economy, officially referred to as the socialist commodity market economy which has been likened to state capitalism by some outside observers. The current Chinese economic system is characterized by state ownership combined with a strong private sector that privately owned enterprises that generate about 33% (People's Daily Online 2005) to over 50% of GDP in 2005, with a BusinessWeek article estimating 70% of GDP, a figure that might be even greater considering the Chengbao system. Some western observers note that the private sector is likely underestimated by state officials in calculation of GDP due to its propensity to ignore small private enterprises that are not registered. Most of the state and private sectors of economy are governed by free market practices, including a stock exchange for trading equity. The free-market is the arbitrator for most economic activity, which is left to the management of both state and private firms. A significant amount of privately owned firms exist, especially in the consumer service sector.

The state sector is concentrated in the commanding heights of the economy with a growing private sector engaged primarily in commodity production and light industry. Centralized directive planning based on mandatory output requirements and production quotas has been superseded by the free-market mechanism for most of the economy and directive planning is utilized in some large state industries. A major difference from the old planned economy is the privatization of state institutions. 150 state-owned enterprises remain and report directly to the central government, most having a number of subsidiaries. By 2008, these state-owned corporations had become increasingly dynamic largely contributing to the increase in revenue for the state. The state-sector led the economic recovery process and increased economic growth in 2009 after the financial crises.

Proponents of this model distinguish themselves from market socialists who believe that economic planning is unattainable, undesirable or ineffective at distributing goods, viewing the market as the solution rather than a temporary phase in development of a socialist planned economy. This type of economic system is defended from a Marxist–Leninist perspective which states that a socialist planned economy can only be possible after first establishing the necessary comprehensive commodity market economy, letting it fully develop until it exhausts its historical stage and gradually transforms itself into a planned economy.

Cuba

The Republic of Cuba under the leadership of Raúl Castro began from 2006 to encourage co-operatives, worker-ownership and self-employment in a move to reduce the central role of state enterprise and state management within the economy, with the goal of building a "deeper" or more co-operative form of socialism. By 2018, there were 429 co-operatives in Cuba, many of which were previously state-owned enterprises.

Vietnam

The Socialist Republic of Vietnam has pursued similar economic reforms to China, though less extensively, resulting in a socialist-oriented market economy, a mixed economy in which the state plays a dominant role intended to be a transitional phase in establishment of a socialist economy.

Social democratic mixed economies

Main article: Social democracy

Many of the industrialized, open countries of Western Europe experimented with one form of social democratic mixed economies or another during the 20th century. These include Britain (mixed economy and welfare state) from 1945 to 1979, France (state capitalism and indicative planning) from 1945 to 1982 under dirigisme, Sweden (social democratic welfare state) and Norway (state social democratic mixed economy) to the present. They are regarded as social democratic and reformist socialist experiments because they universally retained a wage-based economy and private ownership and control of the decisive means of production.

Nevertheless, these western European countries tried to restructure their economies away from a purely private capitalist model. Variations range from social democratic welfare states such as in Sweden to mixed economies where a major percentage of GDP comes from the state sector such as in Norway which ranks among the highest countries in quality of life and equality of opportunity for its citizens. Elements of these efforts persist throughout Europe, even if they have repealed some aspects of public control and ownership. They are typically characterized by the following features:

• Nationalization of key industries such as mining, oil, steel, energy and transportation. A common model is for a sector to be taken over by the state and then one or more state-owned enterprises set up for its day-to-day running. Advantages of nationalization include the ability of the state to direct investment in key industries, the distribution of state profits from nationalized industries for the overall national good, the ability to direct producers to social rather than market goals and greater control of the industries by and for the workers as well as the benefits and burdens of publicly funded research and development are extended to the wider populace.
• Redistribution of wealth, through both tax and spending policies that aim to reduce economic inequalities. Social democracies typically employ various forms of progressive taxation regarding wage and business income, wealth, inheritance, capital gains and property. On the spending side, a set of social policies typically provides free access to public services such as education, health care and child care, while subsidized access to housing, food, pharmaceutical goods, water supply, waste management and electricity is also common.
• Social security schemes where workers contribute to a mandatory public insurance program. The insurance typically include monetary provisions for retirement pensions and survivor benefits, permanent and temporary disabilities, unemployment and parental leave. Unlike private insurance, governmental schemes are based on public statutes and not contracts, so that contributions and benefits may change in time and are based on solidarity among participants. Its funding is done on an ongoing basis, without direct relationship with future liabilities.
• Minimum wages, employment protection and trade union recognition rights for the benefit of workers. The objectives of these policies are to guarantee living wages and help produce full employment. There are a number of different models of trade union protection which evolved, but they all guarantee the right of workers to form unions, negotiate benefits and participate in strikes. Germany appointed union representatives at high levels in all corporations and had much less industrial strife than the United Kingdom, whose laws encouraged strikes rather than negotiation.
• National planning for industrial development.
• Demand management in a Keynesian fashion to help ensure economic growth and employment.

State capitalism

Main article: State capitalism

Various social democratic mixed economies are state capitalist, consisting of large commercial state enterprises that operate according to the laws of capitalism and pursue profits, that have evolved in countries which have been influenced by various elected socialist political parties and their economic reforms. While these policies and reforms did not change the fundamental aspect of capitalism and non-socialist elements within these countries supported or often implemented many of these reforms themselves, the result has been a set of economic institutions that were at least partly influenced by socialist ideology.

India

Main article: Economy of India

After gaining independence from Britain, India adopted a broadly socialist-inspired approach to economic growth. Like other countries with a democratic transition to a mixed economy, it did not abolish private property in capital. India proceeded by nationalizing various large privately run firms, creating state-owned enterprises and redistributing income through progressive taxation in a manner similar to social democratic Western European nations than to planned economies such as the Soviet Union or China. Today, India is often characterized as having a free-market economy that combines economic planning with the free market. However, it did adopt a very firm focus on national planning with a series of broad five-year plans.

Norway

Modern Norwegian state capitalism has its origins in public ownership of the country's oil reserves and in the country's post-World War II social democratic reforms. The government of Norway has ownership stakes in many of the country's largest publicly listed companies, owning 37% of the Oslo stockmarket and operates the country's largest non-listed companies including Statoil and Statkraft. The government also operates a sovereign wealth fund, the Government Pension Fund of Norway, whose partial objective is to prepare Norway for a post-oil future.

Singapore

Main article: Economy of Singapore

Singapore pursued a state-led model of economic development under the People's Action Party which initially adopted a Leninist approach to politics and a broad socialist model of economic development. Originally, there was also infighting between moderates and radicals, including a left-wing and communist wing in the party which saw many imprisoned. The socialist policies practised the PAP during its first few decades in power were of a pragmatic kind as characterized by its rejection of nationalization. Despite this, the PAP was a member of the Socialist International and still claimed to be a socialist party, pointing out its regulation of the private sector, state intervention in the economy and social policies as evidence of this. The prime minister Lee Kuan Yew also stated that he has been influenced by the democratic socialist British Labour Party.

Singapore's economy is dominated by state-owned enterprises and government-linked companies through Temasek Holdings which generate 60% of Singapore's GDP. Temasek Holdings operates like any other company in a market economy. Managers of the holding are rewarded according to profits with the explicit intention to cultivate an ownership mindset. The state also provides substantial public housing, free education and health and recreational services as well as comprehensive public transportation. Today, Singapore is often characterized as having a state capitalist economy that combines economic planning with the free market. While government-linked companies generate a majority of Singapore's GDP, moderate state planning in the economy has been reduced in recent decades. Nonetheless, while being the most right-wing of the Singaporean parties, the PAP has been described as centre-left and adopted a left tack in certain areas in order to remain electorally dominant.

Taiwan

Taiwan's economy has been classified as a state capitalist system influenced by its Leninist model of political control, with some Taiwanese economists referring to Taiwan's economy model as party-state capitalism, a legacy which still lingers in the decision-making process. Taiwan's economy includes a number of state-owned enterprises, but the Taiwanese state's role in the economy shifted from that of an entrepreneur to a minority investor in companies alongside the democratization agenda of the late 1980s.

Paris Commune

Main article: Paris Commune

The Paris Commune was considered to be a prototype mode of economic and political organization for a future socialist society by Karl Marx. Private property in the means of production was abolished so that individuals and co-operative associations of producers owned productive property and introduced democratic measures where elected officials received no more in compensation than the average worker and could be recalled at any time. Anarchists also participated actively in the establishment of the Paris Commune. George Woodcock manifests that "a notable contribution to the activities of the Commune and particularly to the organization of public services was made by members of various anarchist factions, including the mutualists Courbet, Longuet, and Vermorel, the libertarian collectivists Varlin, Malon, and Lefrangais, and the bakuninists Elie and Elisée Reclus and Louise Michel".

Social ownership and peer-to-peer production

Various forms of socialist organization based on co-operative decision making, workplace democracy and in some cases, production directly for use, have existed within the broader context of the capitalist mode of production since the Paris Commune. New forms of socialist institutional arrangements began to take form at the end of the 20th century with the advancement and proliferation of the internet and other tools that allow for collaborative decision-making.

Michel Bauwens identifies the emergence of the open software movement and peer production as an emergent alternative mode of production to the capitalist economy that is based on collaborative self-management, common ownership of resources, and the (direct) production of use-values through the free cooperation of producers who have access to distributed capital. Commons-based peer production generally involves production with no aim to profit directly, but freely contribute to a project relying upon an open common pool of resources. Production is carried out directly for use— ex. open source software is produced solely for its use-value. Wikipedia, being based on collaboration and cooperation and freely associated individuals, has been cited as a template for how socialism might operate. This is understood by some as a modern example of what the Paris Commune—a template for possible future organization—was to Marx in his time. Others, like Stefan Meretz, believe that commons-based peer production transcends socialism, no only capitalism.

Socialist Federal Republic of Yugoslavia

Main article: Economy of the Socialist Federal Republic of Yugoslavia

The Socialist Federal Republic of Yugoslavia pursued a socialist economy based on autogestion or worker self-management. Rather than implementing a centrally planned economy, Yugoslavia developed a market socialist system where enterprises and firms were socially owned rather than publicly owned by the state. In these organizations, the management was elected directly by the workers in each firm, and were later organized according to Edvard Kardelj's theory of associated labor.

Self-managed enterprises

See also: Cooperative

The Mondragon Corporation, a federation of cooperatives in the Basque region of Spain, organizes itself as an employee-owned, employee-managed enterprise. Similar styles of decentralized management which embrace cooperation and collaboration in place of traditional hierarchical management structures have been adopted by various private corporations such as Cisco Systems. Unlike Mondragon, Cisco remains firmly under private ownership. More fundamentally, employee-owned, self-managed enterprises still operate within the broader context of capitalism and are subject to the accumulation of capital and profit-loss mechanism.

Anarchist Spain

Main article: Spanish Revolution of 1936

See also: Anarcho-syndicalism

In Spain, the national anarcho-syndicalist trade union Confederación Nacional del Trabajo initially refused to join a popular front electoral alliance and abstention by CNT supporters led to a right wing election victory. In 1936, the CNT changed its policy and anarchist votes helped bring the popular front back to power. Months later, the former ruling class responded with an attempted coup causing the Spanish Civil War (1936–1939). In response to the army rebellion, an anarchist-inspired movement of peasants and workers, supported by armed militias, took control of Barcelona and of large areas of rural Spain where they collectivised the land.

Even before the fascist victory in 1939, the anarchists were losing ground in a bitter struggle with the Stalinists, who controlled the distribution of military aid to the Republican cause from the Soviet Union. The events known as the Spanish Revolution was a workers' social revolution that began during the outbreak of the Spanish Civil War in 1936 and resulted in the widespread implementation of anarchist and more broadly libertarian socialist organizational principles throughout various portions of the country for two to three years, primarily Catalonia, Aragon, Andalusia, and parts of the Levante. Much of Spain's economy was put under worker control and in anarchist strongholds such as Catalonia, the figure was as high as 75%, although it was lower in areas with heavy Communist Party of Spain influence as the Soviet-allied party actively resisted attempts at collectivization enactment. Factories were run through worker committees, agrarian areas became collectivised and run as libertarian communes. Anarchist historian Sam Dolgoff estimated that about eight million people participated directly or at least indirectly in the Spanish Revolution which he claimed "came closer to realizing the ideal of the free stateless society on a vast scale than any other revolution in history".

Criticism

Main article: Criticism of socialism

The neoclassical view is that there is a lack of incentive, not a lack of information in a planned economy. They argue that within a socialist planned economy there is a lack of incentive to act on information. Therefore, the crucial missing element is not so much information as the Austrian School argued as it is the motivation to act on information.

Quiet Revolution

From Wikipedia, the free encyclopedia

https://en.wikipedia.org/wiki/Quiet_Revolution

The Quiet Revolution (French: Révolution tranquille) refers to a significant period of socio-political and socio-cultural transformation in French Canada, particularly in Quebec, following the election of 1960. This period was marked by the secularization of the government, the establishment of a state-administered welfare state known as the état-providence, a shift in political alignment toward federalist and sovereigntist (or separatist) factions, and the eventual election of a pro-sovereignty provincial government in the 1976 election. While the Quiet Revolution is often associated with the efforts of the Liberal Party of Quebec's government led by Jean Lesage (elected in 1960) and, to some extent, Robert Bourassa (elected in 1970 after Daniel Johnson of the Union Nationale in 1966), its profound impact has influenced the policies of most provincial governments since the early 1960s.

A primary change was an effort by the provincial government to assume greater control over healthcare and education, both of which had previously been under the purview of the Catholic Church. To achieve this, the government established ministries of Health and Education, expanded the public service, made substantial investments in the public education system, and permitted the unionization of the civil service. Additionally, measures were taken to enhance Quebecois control over the province's economy, including the nationalization of electricity production and distribution, the creation of the Canada/Québec Pension Plan, and the establishment of Hydro-Québec in an effort to nationalize Quebec's electric utilities. Furthermore, during this period, French Canadians in Quebec adopted the term 'Québécois' to distinguish themselves from both the rest of Canada and France, solidifying their identity as a reformed province.

The Quiet Revolution ushered in a period of significant economic and social development not only in Quebec but also in French Canada and Canada as a whole. This transformation coincided with similar developments occurring in the Western world in general. Notably, it brought about notable changes to the physical landscape and social structures of Montreal, Quebec's principal city. The impact of the Quiet Revolution extended beyond Quebec's borders, influencing contemporary Canadian politics. Concurrent with the rise of Quebecois nationalism during this era. French Canadians made substantial strides in shaping the structure and direction of the federal government and national policies.

On March 28, 1969, a significant street demonstration took place in Montreal, known as Operation McGill français. The primary objective of this protest was to advocate for McGill University to become a French-speaking educational institution.

Origins

The hill leading to Place d'Armes in Montreal, an important historic site of French Canada

"Maîtres chez nous" (Masters in Our Own Home) was the electoral slogan of the Liberal Party during the 1962 election.

The 1950s tenure of Quebec Premier Maurice Duplessis epitomized the conservative ideal of a religiously and culturally pure Québec, and became known among liberals as the Grande Noirceur (Great Darkness), although the Richard Riot of 1955 may have signaled growing submerged forces. Soon after Duplessis' death, the June 1960 provincial election installed the Liberal provincial government of Jean Lesage, and the Quiet Revolution began.

Prior to the 1960s, the government of Québec was controlled by the conservative Duplessis, leader of the Union Nationale party. Not all the Catholic Church supported Duplessis - some Catholic unions and members of the clergy criticized him, including Montreal Archbishop Joseph Charbonneau - but the bulk of the small-town and rural clergy supported him. Some quoted the Union Nationale slogan Le ciel est bleu, l'enfer est rouge (The sky (Heaven) is blue, Hell is red) as a reference to the colors of the Union Nationale (blue) and the Liberals (red), the latter accused often of being pro-communist. Radio-Canada, the newspaper Le Devoir and political journal Cité Libre were intellectual forums for critics of the Duplessis Government.

Prior to the Quiet Revolution, the province's natural resources were developed mainly by foreign investors, such as the US-based Iron Ore Company of Canada. In the spring of 1949, a group of 5,000 asbestos miners went on strike for three months against a foreign corporation. They were supported by Monsignor Charbonneau (Bishop of Montreal), the Québécois nationalist newspaper Le Devoir, and a small group of intellectuals. Until the second half of the 20th century, the majority of Francophone Québec workers lived below the poverty line, and Francophones did not join the executive ranks of the businesses of their own province. Political activist and singer Félix Leclerc wrote: "Our people are the waterboys of their own country."

In many ways, Duplessis's death in 1959, quickly followed by the sudden death of his successor Paul Sauvé, triggered the Quiet Revolution. The Liberal Party, led by Jean Lesage and campaigning under the slogans Il faut que ça change ("Things have to change") and Maîtres chez nous ("Masters of our own house", a phrase coined by Le Devoir editor André Laurendeau), was voted into power within a year of Duplessis's death.

It is generally accepted that the revolution ended before the October Crisis of 1970, but Québec society has continued to change dramatically since then, notably with the rise of the sovereignty movement, evidenced by the election of the sovereigntist Parti Québécois (first in 1976 by René Lévesque), the formation of a sovereigntist political party representing Québec on the federal level, the Bloc Québécois (founded in 1991 by Lucien Bouchard), as well as the 1980 and 1995 sovereignty referendums. Some scholars argue that the rise of the Québec sovereignty movement during the 1970s is also part of this period.

Secularization and education

The Canadian Constitution of 1867 made education the responsibility of the province. Québec set up a Ministry of Public Instruction in 1868 but abolished it in 1875 under pressure from the Catholic Church. The clergy believed it would be able to provide appropriate teaching to young people and that the province should not interfere. By the early 1960s, there were more than 1,500 school boards, each responsible for its own programs, textbooks and the recognition of diplomas according to its own criteria.

In addition, until the Quiet Revolution, higher education was accessible to only a minority of French Canadians because of the generally low level of formal education and the expense involved. Moreover, secondary schools had placed a lot more emphasis on the liberal arts and soft sciences than the hard sciences.

Université du Québec à Montréal

Following World War II, while most of the United States and Canada was enjoying a long period of prosperity and modernization, economic growth was slower in Québec. The level of formal schooling among French-Canadians was quite low: only 13% finished grade 11, as opposed to 36% of English Canadians. One of the most scathing attacks on the educational system was levelled by Brother Jean-Paul Desbiens, writing under the pseudonym of Frère Untel. The publication of his book Les insolences du Frère Untel (1960) quickly sold over 100,000 copies and has come to be recognized as having important impact on the beginning of the Quiet Revolution.

Alphonse-Marie Parent presided over a commission established in 1961 to study the education system and bring forth recommendations, which eventually led to the adoption of several reforms, the most important of which was secularization of the education system. In 1964 a Ministry of Education was established with Paul Gérin-Lajoie appointed the first Minister of Education since 1875. Although schools maintained their Catholic or Protestant character, in practice they became secular institutions. Reforms included raising the age for compulsory schooling from 14 to 16; providing free schooling until the 11th grade; reorganizing school boards; standardizing school curricula; and replacing classical colleges, first with CEGEPs (publicly funded pre‑university colleges) in 1965, then the Université du Québec network in 1969. The reforms were an effort to improve access to higher education, geographically and financially. Additionally, more emphasis was placed on the hard sciences, and there was now work for the Québécois who had previously needed to leave the province in order to find jobs in their preferred fields. For example, the opening of Hydro-Québec meant that skilled engineers needed to be hired.

Also during this period the Ministry of Social Affairs was created, which in June 1985 became the Ministry of Health and Social Services, responsible for the administration of health and social services in the province.

The Quiet Revolution combined declericalization with the radicalized implementation of Vatican II. There was a dramatic change in the role of nuns, which previously had attracted 2–3% of Québec's young women. Many left the convent while very few young women entered. The Provincial government took over the nuns' traditional role as provider of many of Québec's educational and social services. Often ex-nuns continued the same roles in civilian dress; and for the first time men started entering the teaching profession.

Also during the time of the Quiet Revolution, Quebec experienced a large drop in the total fertility rate (known as TFR: the lifetime average number of live births per woman of child-bearing age) falling from 3.8 in 1960 to 1.9 in 1970. According to a study commissioned in 2007 by The Québec Ministry of Families, Seniors and Status of Women on possible ways to address problems related to a by then even lower TFR (1.6) "Starting in 1960, Québec experienced a drop in fertility that was so sharp and rapid, it was almost unparalleled in the developed countries."

In the 2003 article "Where Have All the Children Gone?", published in the academic journal Canadian Studies in Population by Professor Catherine Krull of Queen's University and Professor Frank Trovato of The University of Alberta, point to the decline in influence of the Roman Catholic Church over the lives of French-Canadians as one of the causes of the great reduction in the TFR during the Quiet Revolution. Per Professor Claude Belanger of Montreal's Marianopolis College the loss of influence of the Roman Catholic Church and subsequent abandonment of long adhered to Church teachings concerning procreation was a key factor in Quebec going from having the highest provincial birth rate in 1960 to the lowest in 1970.

Economic reforms

Hydro-Québec's Jean-Lesage generating station, formerly known as Manic-2, built between 1961 and 1965.

Seeking a mandate for its most daring reform, the nationalization of the province's electric companies under Hydro-Québec, the Liberal Party called for a new election in 1962. The Liberal party was returned to power with an increased majority in the Legislative Assembly of Québec and within six months, René Lévesque, Minister of Natural Resources, enacted his plans for Hydro-Québec. The Hydro-Québec project grew to become an important symbol in Québec. It demonstrated the strength and initiative of the Québec government and was a symbol of the ingenuity of Québécois in their capability to complete such an ambitious project. The original Hydro-Québec project ushered in an era of "megaprojects" that would continue until 1984, seeing Québéc's hydroelectric network grow and become a strong pillar of the province. Today, Hydro-Québec remains a crucial element to the Québec economy, with annual revenues of $12.7 billion Canadian dollars, $1.1 billion going directly into the province's coffers.

Hydro-Québec headquarters in Montréal

More public institutions were created to follow through with the desire to increase the province's economic autonomy. The public companies SIDBEC (iron and steel), SOQUEM (mining), REXFOR (forestry) and SOQUIP (petroleum) were created to exploit the province's natural resources. This was a massive shift away from the Duplessis era in which Québec's abundant natural resources were hardly utilized. Duplessis' policy was to sell off untransformed natural resources at bargain prices in order to create more employment in Québec's regions. This strategy, however, proved weak as Québec's natural resources were exploited for little profit. The shift in mentality of the Quiet Revolution allowed Québec to gain further financial autonomy by accessing this area of the economy which, as is evidenced by Hydro-Québec, is extremely profitable. The Société générale de financement (General financing corporation) was created in 1962 to encourage Québécois to invest in their economic future and to increase the profitability of small companies. In 1963, in conjunction with the Canada Pension Plan the government of Canada authorized the province to create its own Régie des Rentes du Québec (RRQ, Québec Pension Plan); universal contributions came into effect in 1966. The Caisse de dépôt et placement du Québec (CDPQ, Québec Deposit and Investment Fund) was created in 1965 to manage the considerable revenues generated by the RRQ and to provide the capital necessary for various projects in the public and private sectors.

A new labour code (Code du Travail) was adopted in 1964. It made unionizing much easier and gave public employees the right to strike. It was during the same year that the Code Civil (Civil Code) was modified to recognize the legal equality of spouses. In case of divorce, the rules for administering the Divorce Act were retained using Québéc's old community property matrimonial regime until 1980, when new legislation brought an automatic equal division of certain basic family assets between spouses.

Nationalism

The societal and economic innovations of the Quiet Revolution, which empowered Québec society, emboldened certain nationalists to push for political independence. While visiting Montreal for Expo 67, General Charles de Gaulle proclaimed Vive le Québec libre! in a speech at Montreal City Hall, which gave the Québec independence movement further public credibility. In 1968, the sovereigntist Parti Québécois was created, with René Lévesque as its leader. A small faction of Marxist sovereignists began terrorist actions as the Front de libération du Québec, the zenith of their activities being the 1970 October Crisis, during which British diplomat James Cross as well as Labour Minister Pierre Laporte were both kidnapped by FLQ cells, with Laporte eventually being killed.

The Parti Québécois twice led the Québécois people through unsuccessful referendums, the first in 1980 on the question of political sovereignty with economic association to Canada (also known as sovereignty association), and the second in 1995 on full sovereignty.

In 1977, during their first term in office, the Parti Québécois enacted the Charter of the French Language, known more commonly as Bill 101, whose goal is to protect the French language by making it the language of business in Québec, as well as restricting the use of English on signs. The bill also restricted the eligibility for elementary and high school students to attend school in English, allowing this only for children of parents who had studied in English in Québec. Children may also be eligible for English education if their parents or grandparents received a certain amount of English education outside of the province (ex. another Canadian province). Once a child has been permitted to attend an English primary or high school, the remaining children in that family are also granted access. This bill still stands today, although many reforms have been made in an attempt to make it less harsh.

Historiography

Several historians have studied the Quiet Revolution, presenting somewhat different interpretations of the same basic facts. For example, Cuccioletta and Lubin raised the question of whether it was an unexpected revolution or an inevitable evolution of society. Behiels asked, how important are economic factors such as outside control of Québec's finance and industry? Was the motivating force one of liberalism or one of nationalism? Gauvreau raised the issues of religious factors, and of the changes going on inside the Catholic Church. Seljak felt that the Catholic Church could have responded with a more vocal opposition.

A revolution or a natural course of action?

Modern Québec historians have brought some nuance to the importance of the Quiet Revolution. Though the improvements made to Québec society during this era make it seem like an extremely innovative period, it has been posited that these changes follow a logical revolutionary movement occurring throughout the Western world in the 1960s. Québec historian Jacques Rouillard ^[fr] took this revisionist stance in arguing that the Quiet Revolution may have accelerated the natural evolution of Quebec's francophone society rather than having turned it on its head.

Several arguments support this view. From an economic perspective, Quebec's manufacturing sector had seen important growth since the Industrial Revolution. Buoyed by significant manufacturing demand during World War I and World War II, the Québec economy was already expanding before the events of the Quiet Revolution.

Rouillard also argues that traditional portrayals of the Quiet Revolution falsely depict it as the rise of Liberalism in Québec. He notes the popularity enjoyed by federal Liberal Prime Minister Sir Wilfrid Laurier as well as the Premiership of Adélard Godbout as examples of Québec Liberalism prior to the events of the Quiet Revolution. The Godbout administration was extremely innovative. Its achievements include nationalizing the electricity distribution network of the city of Montreal, granting universal suffrage, instituting mandatory schooling until the age of 14 and establishing various social programs in Québec.

The perception of the Quiet Revolution as a great upheaval in Québec society persists, but the revisionist argument that describes this period as a natural continuation of innovations already occurring in Québec cannot be omitted from any discussion on the merits of the Quiet Revolution. The historiography of the period has been notably explored by Ronald Rudin, who describes the legacy of the Lesage years in the depiction of what preceded them. Though criticized as apologists for Duplessis, Robert Rumilly and Conrad Black did add complexity to the narrative of neo-nationalists by contesting the concept of a "Grande Noirceur," the idea that Duplessis's tenure in office was one of reactionary policies and politics. Dale Thomson, for his part, noted that Jean Lesage, far from seeking to dismantle the traditional order, negotiated a transition with (and sought to accommodate) Québéc's Catholic Church. Several scholars have lately sought to mediate the neo-nationalist and revisionist schools by looking at grassroots Catholic activism and the Church's involvement in policy-making.

Federal politics

Politics at the federal level were also in flux. In 1957, the federal government passed the Hospital Insurance and Diagnostic Services Act. This was, effectively, the beginning of a pan-Canadian system of public health insurance. In 1961, Prime Minister Diefenbaker instituted the National Hospital Insurance Plan, the first public health insurance plan adhered to by all the provinces. In 1966, the National Medicare program was created.

Federal politics were further influenced by the election of Pierre Elliot Trudeau in 1968. The rise to power of arguably Canada's most influential Prime Minister was unique in Canadian politics. The charisma and charm he displayed throughout his whirlwind campaign swept up much of the country in what would be referred to as Trudeaumania. Before the end of the 1960s, Trudeau would pass the Official Languages Act (1969), which aimed to ensure that all federal government services were available in both of Canada's official languages. By the end of the 1960s, Trudeau had also passed legislation decriminalizing homosexuality and certain types of abortion.

Municipal politics

Montreal municipal politics were also going through an important upheaval. Jean Drapeau became Montreal mayor on October 24, 1960. Within the first few years of his tenure, Drapeau oversaw a series of infrastructure projects, including the expansion of Dorval airport (now Montréal–Pierre Elliott Trudeau International Airport), the opening of the Champlain bridge and the renaissance of Old Montreal. He also oversaw the construction and inauguration of Place des Arts. Drapeau was also instrumental in the construction of the Montreal metro system, which was inaugurated on October 14, 1966. Under Drapeau, Montreal was awarded the 1967 International and Universal Exposition (Expo 67), whose construction he oversaw. He was also one of the key politicians responsible for National League of baseball granting Montreal a franchise, the now-defunct Montreal Expos. Another of Drapeau's major projects was obtaining and holding the 1976 Summer Olympics.

Important figures

• Pierre Bourgault
• Thérèse Casgrain
• Michel Chartrand
• Jean Drapeau
• Paul Gérin-Lajoie
• Eric Kierans
• Pierre Laporte
• Jean Lesage
• René Lévesque
• Maurice Duplessis
• Gilles Vigneault
• Claire Kirkland-Casgrain
• Lucien Bouchard

Sustainable population

From Wikipedia, the free encyclopedia
https://en.wikipedia.org/wiki/Sustainable_population

Sustainable population refers to a proposed sustainable human population of Earth

A SUSTAINABLE MANKIND ON PLANET EARTH is limited by REGENERABILITY of RESSOURCES.

In 2020 worldpopulation consists of 8 billion people and consumes RESSOURCES of 2 planets EARTH : www.footprintnetwork.org (database)

A SUSTAINABLE WORLDPOPULATION

- 4 billion people living on a LOW level of life

- 3 billion people living on a MIX Level of life or

- 2 billion people living on a HIGH Level of life

To reach a SUSTAINABLE WORLDPOPULATION we need a WORLDWIDE One Child Policy which is supported by a reward system of tax advantages for OneChildFamilies. That's the most important Goal of WORLDWIDE Policy.

Estimates vary widely, with estimates based on different figures ranging from 0.65 billion people to 9.8 billion, with 8 billion people being a typical estimate. Projections of population growth, evaluations of overconsumption and associated human pressures on the environment have led to some to advocate for what they consider a sustainable population. Proposed policy solutions vary, including sustainable development, female education, family planning and broad human population planning.

Emerging economies like those of China and India aspire to the living standards of the Western world, as does the non-industrialized world in general. As of 2022, China and India account for most of the population in Asia, with more than 1.4 billion each. It is the combination of population increase in the developing world and unsustainable consumption levels in the developed world that poses a stark challenge to sustainability.

According to the UN Population Fund, high fertility and poverty have been strongly correlated, and the world's poorest countries also have the highest fertility and population growth rates.

Estimates

World population growth rate, 1950–2050, as estimated in 2011 by the U.S. Census Bureau, International Data Base. Although the rate of growth decreases, population continues to rise. In 2050 still growing by over 45 million per year

Map of countries and territories by fertility rate as of 2020

Sustainable population

Many studies have tried to estimate the world's sustainable population for humans, that is, the maximum population the world can host. A 2004 meta-analysis of 69 such studies from 1694 until 2001 found the average predicted maximum number of people the Earth would ever have was 7.7 billion people, with lower and upper meta-bounds at 0.65 and 9.8 billion people, respectively. They conclude: "recent predictions of stabilized world population levels for 2050 exceed several of our meta-estimates of a world population limit". A 2012 United Nations report summarized 65 different estimates of maximum sustainable population size and the most common estimate was 8 billion.

Climate change, excess nutrient loading (particularly nitrogen and phosphorus), increased ocean acidity, rapid biodiversity loss, and other global trends suggest humanity is causing global ecological degradation and threatening ecosystem services that human societies depend on. Because these environmental impacts are all directly related to human numbers, recent estimates of a sustainable human population tend to put forward much lower numbers, between 2 and 4 billion. Paul R. Ehrlich stated in 2018 that the optimum population is between 1.5 and 2 billion. Geographer Chris Tucker estimates that 3 billion is a sustainable number, provided human societies rapidly deploy less harmful technologies and best management practices. Other estimates of a sustainable global population also come in at considerably less than the current population of 8 billion.

A 2014 study published in the Proceedings of the National Academy of Sciences of the United States of America posits that, given the "inexorable demographic momentum of the global human population," efforts to slow population growth in the short term will have little impact on sustainability, which can be more rapidly achieved with a focus on technological and social innovations, along with reducing consumption rates, while treating population planning as a long term goal. The study says that with a fertility-reduction model of one-child per female by 2100, it would take at least 140 years to reduce the population to 2 billion people by 2153. The 2022 "Scientists' warning on population," published by Science of the Total Environment, states that "environmental analysts regard a sustainable human population as one enjoying a modest, equitable middle-class standard of living on a planet retaining its biodiversity and with climate-related adversities minimized," which is estimated at between 2 and 4 billion people.

Skeptics criticize the basic assumptions associated with these overpopulation estimates. For example, Jade Sasser believes that calculating a maximum of number of humanity which may be allowed to live while only some, mostly privileged European former colonial powers, are mostly responsible for unsustainably using up the Earth, is wrong.

But if current human numbers are not ecologically sustainable, the costs are likely to fall on the world’s poorest citizens, regardless of whether they helped cause the problem. In fact, countries that contribute the most to unsustainable production and consumption practices often have higher income per capita and slower population growth, unlike countries that have a low income per capita and rapidly growing populations.

According to a 2022 study published in Sustainable Development, a sustainable population is required for both preserving biodiversity and food security. The study says that falling fertility rates are linked to access to contraception and family planning services, and has little to no relation to economic growth.

World population

According to data from 2015, the world population is projected to reach 8.5 billion by 2030, up from the current 8 billion, to exceed 9 billion people by 2050, and to reach 11.2 billion by the year 2100. Most of the increase will be in developing countries whose population is projected to rise from 5.6 billion in 2009 to 7.9 billion in 2050. This increase will be distributed among the population aged 15–59 (1.2 billion) and 60 or over (1.1 billion) because the number of children under age 15 in developing countries is predicted to decrease. In contrast, the population of the more developed regions is expected to undergo only slight increase from 1.23 billion to 1.28 billion, and this would have declined to 1.15 billion but for a projected net migration from developing to developed countries, which is expected to average 2.4 million persons annually from 2009 to 2050. Long-term estimates in 2004 of global population suggest a peak at around 2070 of nine to ten billion people, and then a slow decrease to 8.4 billion by 2100.

However, these projections assume substantial improvements in contraceptive availability throughout the developing world and large decreases in desired family size (particularly in sub-Saharan Africa), which may or may not happen. In the end, all population projections must be taken with a large pinch of salt. Particular care is needed to remember that future population size will depend on policy decisions and individual choices.

Carrying capacity

Urbanization in Seattle, Washington, United States

Talk of economic and population growth overshooting the limits of Earth's carrying capacity for humans is popular in environmentalism. The potential limiting factor for the human population might include water availability, energy availability, renewable resources, non-renewable resources, heat removal, photosynthetic capacity, or land availability for food production. Or, as current trends suggest, the limiting factors might involve ecosystems’ ability to absorb human pollution, as with climate change, ocean acidification, or the toxification of rivers and streams. The applicability of carrying capacity as a measurement of the Earth's limits in terms of the human population has been questioned, since it has proved difficult to calculate or predict the upper limits of population growth. Carrying capacity has been used as a tool in Neo-Malthusian arguments to limit population growth since the 1950s. The concept of carrying capacity has been applied to determining the population limits in Shanghai, a city faced with rapid urbanization.

The application of the concept of carrying capacity for the human population, which exists in a non-equilibrium, has been criticized for not successfully being able to model the processes between humans and the environment. In popular discourse the concept is often used vaguely in the sense of a "balance between nature and human populations".

In human ecology a popular definition from 1949 states "the maximum number of people that a given land area will maintain in perpetuity under a given system of usage without land degradation setting in". Sociologists have criticized this for numerous reasons. Aside from the fact that humans are able to adopt new customs and technology, some common critiques are 1.) an assumption an equilibrium population exists, 2.) difficulties in measuring resources, 3.) inability to account for human tastes and how much labour they will expend, 4.) assumption of full usage of resources, 5.) assumption of landscape homogeneity, 6.) assumption that regions are isolated from each other, 7.) contradicted by history, and 8.) the standard of living is ignored.

Romanian American economist Nicholas Georgescu-Roegen, a progenitor in economics and a paradigm founder of ecological economics, has argued in 1971 that the carrying capacity of Earth — that is, Earth's capacity to sustain human populations and consumption levels — is bound to decrease sometime in the future as Earth's finite stock of mineral resources is presently being extracted and put to use. Leading ecological economist and steady-state theorist Herman Daly, a student of Georgescu-Roegen, has propounded the same argument. In a series of writings, Daly has explored the connection between limiting population and achieving ecologically sustainable societies, arguing that a sustainable economy must involve limits to human numbers, since per capita human resource use can never be driven down to zero.

Ecovillage

From Wikipedia, the free encyclopedia
https://en.wikipedia.org/wiki/Ecovillage

Sieben Linden Ecovillage

An eco-house at Findhorn Ecovillage with a turf roof and solar panels

Tallebudgera Mountain and a vegetable garden at the Currumbin Ecovillage in Queensland, 2015

An ecovillage is a traditional or intentional community that aims to become more socially, culturally, economically and/or environmentally sustainable. An ecovillage strives to have the least possible negative impact on the natural environment through the intentional physical design and behavioural choices of its inhabitants. It is consciously designed through locally owned, participatory processes to regenerate and restore its social and natural environments. Most range from a population of 50 to 250 individuals, although some are smaller, and traditional ecovillages are often much larger. Larger ecovillages often exist as networks of smaller sub-communities. Some ecovillages have grown through like-minded individuals, families, or other small groups—who are not members, at least at the outset—settling on the ecovillage's periphery and participating de facto in the community. There are currently more than 10,000 ecovillages around the world.

Ecovillagers are united by shared ecological, social-economic and cultural-spiritual values. Concretely, ecovillagers seek alternatives to ecologically destructive electrical, water, transportation, and waste-treatment systems, as well as the larger social systems that mirror and support them. Many see the breakdown of traditional forms of community, wasteful consumerist lifestyles, the destruction of natural habitat, urban sprawl, factory farming, and over-reliance on fossil fuels as trends that must be changed to avert ecological disaster and create richer and more fulfilling ways of life.

Ecovillages offer small-scale communities with minimal ecological impact or regenerative impacts as an alternative. However, such communities often cooperate with peer villages in networks of their own (see Global Ecovillage Network (GEN) for an example). This model of collective action is similar to that of Ten Thousand Villages, which supports the fair trade of goods worldwide.

The concept of the ecovillage has undergone significant development over time, as evidenced by the remarkable growth and evolution of these communities over the past few decades. The various facets of the ecovillage include case studies of community models, discussions on sustainability alignment for diverse needs, examinations of their environmental impact, explorations of governance structures, and considerations of the challenges faced on their path towards a successful ecovillage.

Definition

Multiple sources define ecovillages as a subtype of intentional communities focusing on sustainability. More pronounced definitions are listed here:

Source	Year	Definition
Robert Gilman	1991	"human-scale full-featured settlement in which human activities are harmlessly integrated into the natural world in a way that is supportive of healthy human development, and can be successfully continued into the indefinite future."
Diana Michelle Fischetti	2008	"intentional community whose members strive to live in a socially and environmentally sustainable manner, to practice voluntary simplicity, and to cultivate meaning, life satisfaction, and fulfillment."
Kosha Anja Joubert, Executive Director of the GEN	2016	"intentional or traditional communities, consciously designed through participatory process to regenerate their social and natural environments. The social, ecological, economic, and cultural aspects are integrated into a holistic sustainable development model that is adapted to local contexts. Ecovillages are rural or urban settlements with vibrant social structures, vastly diverse, yet united in their actions towards low impact, high quality lifestyles."
GEN	2018	"intentional, traditional or urban community that is consciously designed through locally owned, participatory processes in all 5 dimensions of sustainability (social, culture, ecology, economy and whole systems design) to regenerate their social and natural environments"
GEN	2024	"An ecovillage is an intentional, traditional or urban community that is consciously designed through locally owned, participatory processes in all four dimensions of sustainability (social, culture, ecology and economy) to regenerate their social and natural environments."

In Joubert's view, ecovillages are seen as an ongoing process, rather than a particular outcome. They often start off with a focus on one of the four dimensions of sustainability, e.g. ecology, but evolve into holistic models for restoration. In this view, aiming for sustainability is not enough; it is vital to restore and regenerate the fabric of life and across all four dimensions of sustainability: social, environmental, economic and cultural.

Ecovillages have developed in recent years as technology has improved, so they have more sophisticated structures as noted by Baydoun, M. 2013.

Generally, the ecovillage concept is not tied to specific sectarian (religious, political, corporate) organizations or belief systems not directly related to environmentalism, such as monasteries, cults, or communes.

History

The modern-day desire for community was notably characterized by the communal "back to the land" movement of the 1960s and 1970s through communities such as the earliest example that still survives, the Miccosukee Land Co-op co-founded in May 1973 by James Clement van Pelt in Tallahassee, Florida. In the same decades, the imperative for alternatives to radically inefficient energy-use patterns, in particular automobile-enabled suburban sprawl, was brought into focus by recurrent energy crises. The term "eco-village" was introduced by Georgia Tech Professor George Ramsey in a 1978 address, "Passive Energy Applications for the Built Environment", to the First World Energy Conference of the Association of Energy Engineers, to describe small-scale, car-free, close-in developments, including suburban infill, arguing that "the great energy waste in the United States is not in its technology; it is in its lifestyle and concept of living." Ramsey's article includes a sketch for a "self-sufficient pedestrian solar village" by one of his students that looks very similar to eco-villages today.

The movement became more focused and organized in the cohousing and related alternative-community movements of the mid-1980s. Then, in 1991, Robert Gilman and Diane Gilman co-authored a germinal study called "Ecovillages and Sustainable Communities" for Gaia Trust, in which the ecological and communitarian themes were brought together.

The first Eco-Village in North America began its first stages in 1990. Earthaven Eco-Village in Black Mountain, NC was the first community called an Eco-Village and was designed using permaculture (holistic) principles. The first residents moved onto the vacant land in 1993. As of 2019 Earthaven Eco-Village has over 70 families living off the grid on 368 acres of land.

The ecovillage movement began to coalesce at the annual autumn conference of Findhorn, in Scotland, in 1995. The conference was called: "Ecovillages and Sustainable Communities", and conference organizers turned away hundreds of applicants. According to Ross Jackson, "somehow they had struck a chord that resonated far and wide. The word 'ecovillage'... thus became part of the language of the Cultural Creatives." After that conference, many intentional communities, including Findhorn, began calling themselves "ecovillages", giving birth to a new movement. The Global Ecovillage Network, formed by a group of about 25 people from various countries who had attended the Findhorn conference, crystallized the event by linking hundreds of small projects from around the world, that had similar goals but had formerly operated without knowledge of each other. Gaia Trust of Denmark agreed to fund the network for its first five years.

Since the 1995 conference, a number of the early members of the Global Ecovillage Network have tried other approaches to ecovillage building in an attempt to build settlements that would be attractive to mainstream culture in order to make sustainable development more generally accepted. One of these with some degree of success is Living Villages and The Wintles where eco-houses are arranged so that social connectivity is maximized and residents have shared food growing areas, woodlands, and animal husbandry for greater sustainability.

The most recent worldwide update emerges from the 2022 Annual Report of GEN International, detailing the mapping of 1,043 ecovillage communities on GEN's interactive ecovillage map. GEN collaborated closely with a diverse array of researchers and ecovillage communities spanning the globe to develop the Ecovillage Impact Assessment. Their innovative tool serves as a means for communities, groups, and individuals to accurately report, chart, evaluate, and present their efforts toward fostering participatory cultural, social, ecological, and economic regeneration. Over the course of three years, from February 2021 to April 2024, data from 140 surveys conducted within 75 ecovillages formed the basis of the comprehensive results. Through this assessment ecovillages are empowered to understand their impact and influence their community has had.

Case studies

Ecovillage	Location	Summary
Dancing Rabbit Ecovillage	Missouri, United States	The Dancing Rabbit Ecovillage was founded in 1997 and is located in a rural landscape of northeastern Missouri. This community prides itself on its organic permaculture gardens, natural buildings, alternative energy solutions, and self-governance. As an intentional community, they aim to live ecologically sustainable and socially share the principles and practices of sustainable living with others. They offer many programs such as women's retreats, work exchange and natural building workshops demonstrating how they prioritize outreach, education, and advocacy. As stated on their website they are committed stewards of the land, focusing on wildlife habitat preservation, biodiversity restoration, and sustainable forestry.
Cloughjordan	Ireland	The Cloughjordan Ecovillage was founded in 1999 and is located in a sustainable neighborhood in a rural Ireland. This community encompasses a 67-acre site and has prided itself on their fiber optic broadband, eco-hostels, and a thriving community with over 50 homes and businesses. Cloughjordan serves as a sustainable neighborhood and is a focus for research into sustainability, resilience, and rural regeneration. Through renewable energy, community farming, and educational outreach, Cloughjordan has demonstrated the potential for transitioning to a low-carbon society. It also serves as a not-for-profit cooperative and educational charity, proving their commitment to sustainability and community development.

Sustainability alignment

Ecovillages are defined by their commitment sustainability through a multitude of design, lifestyle, and community objectives. They prioritize environmental stewardship through various methods, including the utilization of renewable energy sources, the minimization of waste through recycling and composting, and the practice of organic agriculture and permaculture. In many cases, these communities strive for self-sufficiency in food production, with the aim of reducing the ecological footprint associated with food transportation. Ecovillage communities place a strong emphasis on the conservation of resources through the application of green building techniques, including passive solar design, natural insulation, and rainwater harvesting. Additionally, they promote alternative modes of transportation, such as cycling and walking, as a means of reducing reliance on fossil fuels. The objective of ecovillages is to cultivate robust social connections and a sense of belonging among residents through the promotion of collaboration, consensus-based decision-making, and shared responsibilities. This approach fosters a supportive environment that enhances both individual and collective resilience. Ecovillages represent an international phenomenon that encompasses cultural diversity, frequently integrating traditional wisdom alongside innovative practices. Many ecovillages espouse multiculturalism, indigenous knowledge, and participation as means of enhancing intergenerational learning. In essence, these communities endeavor to achieve sustainable living through a multitude of diverse efforts, offering valuable insight into the creation of a sustainable relationship between humanity and the natural world. In essence, these communities aim for sustainable living through a multitude of various efforts and offer valuable insight for creating a sustainable relationship between humanity and the natural world.

Environmental impact

The formation of ecovillages is frequently driven by a concern for environmental stewardship and a commitment to sustainable practices. Ecovillages frequently employ reusable power sources, such as solar and wind energy, and utilize natural materials, including mud, wood, and straw, in their construction. Such technologies as bioclimatic agriculture are employed in this regard.

A study on an ecovillage in Ithaca, New York found that the average ecological footprint of a resident in the ecovillage was 70% less than the ecological footprint of most Americans. Ecovillage residents seek a sustainable lifestyle (for example, of voluntary simplicity) for inhabitants with a minimum of trade outside the local area, or ecoregion. Many seek independence from existing infrastructures, although others, particularly in more urban settings, pursue more integration with existing infrastructure. Rural ecovillages are usually based on organic farming, permaculture and other approaches which promote ecosystem function and biodiversity. Ecovillages, whether urban or rural, tend to integrate community and ecological values within a principle-based approach to sustainability, such as permaculture design. In 2019, a study assessed the impact of community sustainability through a life cycle assessment conducted on three ecovillages. The results of this study revealed a substantial reduction in carbon emissions among residents of these ecovillages when compared to the average United States citizen. This study reported that residents had a 63% to 71% decrease in carbon emissions due to living in an ecovillage with sustainable practices and mitigation efforts to environmental impact.

Governance

Ecovillages, while united by their commitment to sustainability and communal living, often differ in their approaches to governance. Every ecovillage strives to reflect the diverse needs and values of their communities. Ultimately, the choice of governance model within ecovillages aims to demonstrates a balance between fostering community cohesion, promoting sustainability, and accommodating the varied needs and values of their members.

Establishing governance is a common method used by ecovillages to align individual actions with community objectives. Most ecovillages maintain a distinct set of policies to govern aspects of what keeps their society functioning. Policies within ecovillages are meant to evolve with new situations prompting revisions to existing guidelines. Ecovillages commonly incorporate elements of consensus decision-making into their governance processes. This approach aims to mitigate hierarchies, power imbalances, and inflexibility within their governments. The governmental framework designed in the Ecovillage Tamera, Portugal promotes inclusivity that actively works to combat hierarchical structures. The Tamera community attributes their success to their Women's Council who confront patriarchal norms and empower women within the governance system. Members of ecovillage communities will select their peers to serve as government members based off established trust within the community, this serves as an active strategy to mitigate the emergence of hierarchies. Through involvement of community members in reviewing and revising existing rules, ecovillages ensure flexibility and adaptability to evolving needs. Active participation in policy formulation fosters a sense of ownership among members regarding community expectations and boundaries. Ecovillage community members express their contentment knowing they had the opportunity to voice their concerns and contribute to the decision-making process.

Each ecovillage exhibits a unique approach to how they will develop their governance. Ecovillages acknowledge that there is a delicate balance in maintaining a functioning community that appreciates and considers the perspectives of its members. Through active involvement in the governance processes, ecovillages demonstrate a commitment to inclusivity, adaptability, and collective empowerment, demonstrating the principles of collaborative decision-making and community-driven change.

Challenges

While ecovillages aim to embody admirable dimensions of sustainability and community, they are not without their challenges. One significant challenge is the initial investment required to establish or transition to an ecovillage lifestyle. The costs of acquiring land, implementing sustainable infrastructure, and maintaining communal facilities can be prohibitive for some individuals or groups making available funds a limiting factor. Conflicts can arise regarding community rules, resource allocation, or individual responsibilities, it can be difficult to maintain cohesion which can be expected in any community type. An explorative study results concluded that the perceived quality of life of residents in eco-developments rated higher perceived quality of life than residents of developments in conventional settings while still noting various challenges they experienced. Another noteworthy challenge can be limited access to resources, like land that is adequate for agriculture, available water or renewable energy potential which can limit the viability of ecovillage initiatives.