Artificial Market

Inclusive Democracy (ID) is a project that aims for direct democracy; economic democracy in a stateless, moneyless and marketless economy; self-management (democracy in the socio-economic realm); and ecological democracy.

The theoretical project of Inclusive Democracy—as distinguished from the political project on which the Inclusive Democracy movement is based—emerged from the work of Greek-born political philosopher, economist, activist and former academic Takis Fotopoulos, in the book ''Towards An Inclusive Democracy'', and was further developed by him and other writers in the journal '' Democracy & Nature'' and its successor ''The International Journal of Inclusive Democracy'', an electronic journal published by the International Network for Inclusive Democracy. In other words, the theoretical project of Inclusive Democracy is a project emerging in political philosophy about social change. On the other hand, the political project of Inclusive Democracy is a project emerging in the history of social struggle.

According to Arran Gare, ''Towards an Inclusive Democracy'' "offers a powerful new interpretation of the history and destructive dynamics of the market and provides an inspiring new vision of the future in place of both neo-liberalism and existing forms of socialism". David Freeman argues that Fotopoulos' approach in that book "is not openly anarchism, yet anarchism seems the formal category within which he works, given his commitment to direct democracy, municipalism and abolition of state, money and market economy".

Conception of Inclusive Democracy

Fotopoulos describes Inclusive Democracy as "a new conception of democracy, which, using as a starting point the classical definition of it, expresses democracy in terms of direct political democracy, economic democracy (beyond the confines of the market economy and state planning), as well as democracy in the social realm and ecological democracy. In short, inclusive democracy is a form of social organisation which re-integrates society with economy, polity and nature. The concept of inclusive democracy is derived from a synthesis of two major historical traditions, the classical democratic and the socialist, although it also encompasses radical green, feminist, and liberation movements in the South".

The starting point of the Inclusive Democracy project is that the world, at the beginning of the new millennium, faces a multi-dimensional crisis (economic, ecological, social, cultural and political), which is shown to be caused by the concentration of power in the hands of various elites. This is interpreted to be the outcome of the establishment, in the last few centuries, of the system of market economy (in the Polanyian sense), Representative democracy, and the related forms of hierarchical structure. Therefore, an inclusive democracy is seen not simply as a utopia, but perhaps as the only way out of the crisis, based on the equal distribution of power at all levels.

In this conception of democracy, the public realm includes not just the political realm, as is usual the practice in the republican or democratic project ( Hannah Arendt, Cornelius Castoriadis, Murray Bookchin et al.), but also the economic, social and ecological realms. The political realm is the sphere of political decision-making, the area in which political power is exercised. The economic realm is the sphere of economic decision-making, the area in which economic power is exercised with respect to the broad economic choices that any scarcity society has to make. The social realm is the sphere of decision-making in the workplace, the education place and any other economic or cultural institution which is a constituent element of a democratic society. The public realm could be extended to include the "ecological realm", which may be defined as the sphere of the relations between society and nature. Therefore, the public realm, in contrast to the private realm, includes any area of human activity in which decisions can be made collectively and democratically.

According to these four realms, we may distinguish between four main constituent elements of an inclusive democracy: the political, the economic, 'democracy in the social realm' and the ecological. The first three elements form the institutional framework, which aims at the equal distribution of political, economic and social power respectively. In this sense, these elements define a system, which aims at the effective elimination of the domination of human being over human being. Similarly, ecological democracy is defined as the institutional framework, which aims to eliminate any human attempt to dominate the natural world, in other words, the system, which aims to reintegrate humans and nature.

Institutional framework

Political or direct democracy

The necessary condition for the establishment of a political democracy involves the creation of appropriate institutions, which secure an equal distribution of political power among all citizens. All political decisions (including those relating to the formation and execution of laws) are taken by the citizen body collectively and without representation. The citizen body of a particular geographical area consists of all residents beyond a certain age of maturity and irrespective of their gender, race, ethnic or cultural identity. The age of maturity is to be defined by the citizen body itself.

The sufficient condition for the reproduction of a political democracy refers to the citizens' level of democratic consciousness and, as David Gabbard and Karen Appleton point out, "the responsibility of cultivating the democratic consciousness requisite to this conception of citizenship falls to paideia" which involves not simply education but character development and a well-rounded knowledge and skills, i.e. the education of the individual as a citizen, which alone can give substantive content to the public space. This is particularly so because democracy can only be grounded on the conscious choice of citizens for individual and collective autonomy. Thus it cannot be the outcome of any social, economic or natural "laws" or tendencies dialectically leading to it, let alone any divine or mystical dogmas and preconceptions. In this sense, neither representative democracy nor Soviet democracy meet the conditions for political democracy, and are simply forms of political oligarchy, where political power is concentrated in the hands of various elites, such as professional politicians and party bureaucrats.

The basic unit of decision-making in an inclusive democracy is the demotic assembly, i.e. the assembly of demos, the citizen body in a given geographical area which may encompass a town and the surrounding villages, or even neighbourhoods of large cities. This is very close to the concept of the 'urban village' proposed today by supporters of de-growth economics. However, apart from local decisions, many important decisions are to be made at the regional or confederal level. Serge Latouche notes that the aim of Inclusive Democracy "presupposes a confederation of demoi" made up of small, homogenous units of around 30,000 people. Therefore, an inclusive democracy today can only take the form of a confederal democracy that is based on a network of administrative councils whose members or delegates are elected from popular face-to-face democratic assemblies in the various demoi. Thus, their role is purely administrative and practical, not one of policy-making like that of representatives in representative democracy.

The citizen body is advised by experts but it is the citizen body which functions as the ultimate decision-taker. Authority can be delegated to a segment of the citizen body to carry out specific duties, for example to serve as members of popular courts, or of regional and confederal councils. Such delegation is made, in principle, by lot, on a rotation basis, and is always recallable by the citizen body. Delegates to regional and confederal bodies should have specific mandates.

Finally, political or direct democracy implies a very different conception of citizenship than the usual liberal and socialist conceptions. In this conception, political activity is not a means to an end, but an end in itself so that one does not engage in political action simply to promote one's welfare but to realize the principles intrinsic to political life, such as freedom, equality and solidarity. This, in contrast to the liberal and social-democratic conceptions which adopt an 'instrumentalist' view of citizenship, i.e. a view which implies that citizenship entitles citizens with certain rights that they can exercise as means to the end of individual welfare.

Economic democracy and the role of an artificial market

The Inclusive Democracy project introduced a very different conception from the usual one of economic democracy. According to the Inclusive Democracy project, economic democracy is the authority of demos (community) in the economic sphere—which requires equal distribution of economic power. Therefore, all macroeconomic decisions are made by the citizen body collectively and without representation. However, microeconomic decisions at the workplace or the household levels are made by the individual production or consumption unit through a proposed system of vouchers.

As is the case fordirect democracy, economic democracy today is only feasible at the level of the confederated ''demoi''. It involves the ownership and control of the means of production by the demos. This is radically different from the two main forms of concentration of economic power : capitalist and 'socialist' growth economy. It is also different from the various types of collectivist capitalism, such as workers' control and milder versions suggested by post-Keynesian social democrats. The demos, therefore, becomes the authentic unit of economic life.

For economic democracy to be feasible, three preconditions must be satisfied: Demotic self-reliance, demotic ownership of the means of production, and confederal allocation of resources.

*Demotic self-reliance is meant in terms of radical decentralisation and collective self-sufficiency, in the sense of relying on the demos' resources rather than in the sense of autarky.
*Demotic ownership of productive resources is a kind of ownership which leads to the politicisation of the economy, the real synthesis of economy and polity. This is so because economic decision making is carried out by the entire community, through the demotic assemblies, where people make the fundamental macro-economic decisions which affect the whole community, as citizens, rather than as vocationally oriented groups (e.g. workers, as in Parecon). At the same time, workers, apart from participating in the demotic decisions about the overall planning targets, would also participate (in the above broad sense of vocationally oriented groups) in their respective workplace assemblies, in a process of modifying/implementing the democratic plan and in running their own workplace.
*Confederal allocation of resources is required because, although self-reliance allows many decisions to be made at the community level, much remains to be decided at the regional/national/supra-national level. However, it is delegates (rather than representatives) with specific mandates from the demotic assemblies who are involved in a confederal demotic planning process which, in combination with the proposed system of vouchers, effects the allocation of resources in a confederal inclusive democracy.

A model of economic democracy, as an integral part of an inclusive democracy, is described in ''Towards An Inclusive Democracy'' (ch 6), the first book-length description of inclusive democracy. The main characteristic of the proposed model, which also differentiates it from socialist planning models like Parecon, is that it explicitly presupposes a stateless, money-less and market-less economy that precludes private accumulation of wealth and the institutionalisation of privileges for some sections of society, without relying on a mythical post-scarcity state of abundance, or sacrificing freedom of choice. The proposed system aims at satisfying the double aim of:

*(a) meeting the basic needs of all citizens—which requires that basic macro-economic decisions have to be made democratically, and
*(b) securing freedom of choice—which requires the individual to make important decisions affecting his/her own life (what work to do, what to consume etc.).

Therefore, the system consists of two basic elements:
*(1) democratic planning, which involves a feedback process between workplace assemblies, demotic assemblies and the confederal assembly, and
*(2) an artificial market using personal vouchers, which ensures freedom of choice but avoids the adverse effects of real markets. Although some have called this system "a form of money based on the labour theory of value", it is not a money model since vouchers cannot be used as a general medium of exchange and store of wealth.

Another distinguishing feature of Inclusive Democracy is its distinction between basic and non-basic needs. Remuneration is according to need for basic needs, and according to effort for non-basic needs. Inclusive Democracy is based on the principle that meeting basic needs is a fundamental human right which is guaranteed to all who are in a physical condition to offer a minimal amount of work. By contrast, Fotopoulos argues, Parecon follows the social democratic rather than the anarcho-communist tradition and instead of proposing satisfaction according to need (as the Inclusive Democracy project does). In defence of Parecon, Albert declares, first, that particular consumption needs such as health care or public parks will be free to all and, second, in regards to special needs, people will be able to make particular requests for need-based consumption to be addressed case by case by others in the economy. In fact, Michael Albert explicitly states that what he calls 'norm four', i.e. 'remuneration according to each person's need' should be applied only in exceptional cases of basic needs and not to all needs defined as such by the citizens' assemblies, as the Inclusive Democracy project declares. Thus, as Albert stresses: "beyond economic justice, we have our compassion, to be applied via norm four where appropriate such as in cases of illness, catastrophe, incapacity and so on".

Artificial market

Proposed within Inclusive Democracy as a solution to the problem of maintaining freedom of choice for the consumer within a marketless and moneyless economy, an artificial market operates in much the same way as traditional markets, but uses labour vouchers or personal credit in place of traditional money. Because of the use of a labour voucher system in consumption of goods and services, an economy using an artificial market would have no actual flow of money and thus the only kind of market that could exist would be a market for commercial goods and services, eliminating capital markets and labour markets.

According to Takis Fotopoulos, an artificial market "secures real freedom of choice, without incurring the adverse effects associated with real markets".Takis Fotopoulos
''Towards an Inclusive Democracy: the crisis of the growth economy and the need for a new liberatory project''
(London & NY: Cassell, 1997), p. 255.

The idea of an artificial market was first proposed by the anarchist theorists Pierre-Joseph Proudhon and Mikhail Bakunin with their respective systems of mutualism and collectivist anarchism, who suggested replacing traditional currency with a system of "labour-cheques" while still retaining basic market relations for goods and services.

The artificial market, however, is rarely advocated as the only element for the allocation of goods and services by its proponents, as most also support a form of directly democratic planning for non-commercial goods and vital resources, and in some cases regulation of the artificial market through planning also. In the Inclusive Democracy's system of allocation of resources, "the artificial market complements the envisaged direct democratic planning mechanism in the allocation of all goods and services on the basis of the crucial distinction introduced in this model between basic and nonbasic goods and services".

According to Fotopoulos, "the allocation of economic resources is made first, on the basis of the citizens' collective decisions, as expressed through the community and confederal plans, and second, on the basis of the citizens' individual choices, as expressed through a voucher system".

The proposed system of the artificial market aims at:
*(A) meeting the basic needs of all citizens, and
*(B) securing freedom of choice in a marketless, moneyless and stateless 'scarcity–society' which has not yet achieved universal autarky (self-sufficiency).

The former requires that basic macro–economic decisions have to be taken democratically, whereas the latter requires the individual to take important decisions affecting his/her own life (what work to do, what to consume, etc.). Both the macro–economic decisions and the individual citizens' decisions are envisaged as being implemented through a combination of democratic planning and an artificial market. But, while in the 'macro' decisions the emphasis will be on planning, the opposite will be true as regards the individual decisions, where the emphasis will be on the artificial market.

Most artificial market proponents reject the traditional socialist adoption of the labour theory of value as they believe it cannot be used as the basis for allocating scarce resources. The reason given is that even if the labour theory of value can give a (partial) indication of availability of resources, it certainly cannot be used as a means to express consumers' preferences. Thus they feel that the labour theory of value cannot serve as the basis for an allocative system that aims at both meeting needs and, at the same time, securing consumer sovereignty and freedom of choice. Instead, the model proposed here is, in fact, a system of rationing, which is based on the revealed consumers' preferences on the one hand, and resource availability on the other.

Differences with participatory economics

Advocates of participatory economics in particular reject markets in all forms in favour of democratic participatory planning. While such systems also uses personal credit in place of money, prices are set according to the direct requests of consumers in democratic "consumer councils" whose demands are relayed to economic facilitation boards who determine and set final prices based on a combination of marginal utility and opportunity cost. On the other hand, as Fotopoulos argues, "no kind of economic organisation based on planning alone, however democratic and decentralized it is, can secure real self-management and freedom of choice."

Democracy in the social realm and feminist critiques

An inclusive democracy is inconceivable unless it extends to the broader social realm to embrace the workplace, the household, the educational institution and indeed any economic or cultural institution, which constitutes an element of this realm. The equal distribution of power in these institutions and self-management are secured through the creation of assemblies of the people involved in each place of work or education (workers' assemblies, student and teachers' assemblies respectively) who make all important decisions about the functioning of these places, within the framework of the decisions taken by citizens' demotic assemblies as regards the general aims of production, education and culture respectively. The assemblies are federated at the regional and confederal levels so that the confederal assemblies of workers, teachers, students and so on could be involved in a process of constant interaction with the citizens' confederal assemblies to define society's "general interest".

A crucial issue with respect to democracy in the social realm is democratisation of the household. One possible solution is the removal of the divide between the household and the public realm. Thus, some feminist writers, particularly eco-feminists, glorify the ''oikos'' and its values as a substitute for the ''polis'' and its politics. This can be understood as an attempt to dissolve the public into the private. At the other extreme, some Marxist feminists attempt to remove the public/private divide by dissolving all private space into a singular public, a socialised or fraternal state sphere. Another possible solution is, taking for granted that the household belongs to the private realm, to 'democratise' it in the sense that household relationships should take on the characteristics of democratic relationships, and that the household should take a form which is consistent with the freedom of all its members.

But for the Inclusive Democracy project, the issue is not the dissolution of the private/public realm divide. The real issue is how, maintaining and enhancing the autonomy of the two realms, such institutional arrangements are adopted that introduce democracy at the household and the social realm in general (workplace, educational establishment etc.) and at the same time enhance the institutional arrangements of political and economic democracy. In this sense, an effective democracy is only conceivable if free time is equally distributed among all citizens, which requires ending the present hierarchical relations in the household, the workplace and elsewhere. Furthermore, democracy in the social realm, particularly in the household, requires institutional arrangements which recognise the character of the household as a need-satisfier and integrate the care and services that the household provides into the general scheme of needs satisfaction.Takis Fotopoulos
''The Multidimensional Crisis and Inclusive Democracy''
(English translation of a book under the same title published in Greek, Gordios, 2005), ch. 15.

Ecological democracy

Steven Best writes:

in bold contrast to the limitations of the animal advocacy movement (AAM) and all other reformist causes, Takis Fotopoulos advances a broad view of human dynamics and social institutions, their impact on the earth, and the resulting consequences for society itself. Combining anti-capitalist, radical democracy, and ecological concerns in the concept of "ecological democracy," Fotopoulos defines this notion as "the institutional framework which aims at the elimination of any human attempt to dominate the natural world, in other words, as the system which aims to reintegrate humans and Nature. This implies transcending the present 'instrumentalist' view of Nature, in which Nature is seen as an instrument for growth, within a process of endless concentration of power.

Some critics of inclusive democracy ask what guarantees an inclusive democracy may offer in ensuring a better relationship of society to nature than the alternative systems of the market economy, or socialist statism. For example, David Pepper, an eco-socialist, pointed out "the 'required' ecological consensus among ecotopia's inhabitants might not be ensured merely by establishing an Athenian democracy where all are educated and rational".David Pepper, ''Modern Environmentalism'', p. 324. However, Inclusive Democracy supporters counter-argue that this criticism represents a clear misconception of what democracy is about because,

if we see it as a process of social self-institution where there is no divinely or 'objectively' defined code of human conduct, such guarantees are by definition ruled out. Therefore, the replacement of the market economy by a new institutional framework of inclusive democracy constitutes only the necessary condition for a harmonious relation between the natural and social worlds. The sufficient condition refers to the citizens' level of ecological consciousness. Still, the radical change in the dominant social paradigm that would follow the institution of an inclusive democracy, combined with the decisive role that paedeia will play in an environmentally-friendly institutional framework, could reasonably be expected to lead to a radical change in the human attitude towards Nature.

Supporters also claim that Inclusive Democracy's institutional framework offers the best hope for a better human relationship to nature than could ever be achieved in a market economy, or one based on socialist statism. The factors supporting this view refer to all three elements of an inclusive democracy: political, economic and social.

Political democracy presupposes a radical decentralisation (physical or administrative) within a confederal society, which, by itself, should enhance its environmentally friendly character. Furthermore, political democracy would create a public space, a fact which would significantly reduce the appeal of materialism by providing a new meaning of life to fill the existential void that the present consumer society creates. Economic democracy replaces the dynamics of the capitalist market economy leading to growth per se with a new social dynamic aiming at the satisfaction of demos' needs. If the satisfaction of demotic needs does not depend, as at present, on the continuous expansion of production to cover the 'needs' that the market system itself creates and if society is reintegrated with the economy, then there is no reason why the present instrumentalist view of nature will continue conditioning human behaviour. Particularly so, since unlike socialist models which are 'centralist', the aim of production in an Inclusive Democracy is not economic growth, but the satisfaction of the basic needs of the community and those non-basic needs for which members of the community express a desire and are willing to work extra for. This implies a new definition of economic efficiency, based not on narrow techno-economic criteria of input minimisation/output maximisation as in socialist models like Parecon, but on criteria securing full coverage of the democratically defined basic needs of all citizens as well as of the non-basic needs they decide to meet, even if this involves a certain amount of inefficiency according to the orthodox economics criteria.

According to Inclusive Democracy supporters, democracy in the social realm should be a decisive step in the creation of the sufficient condition for a harmonious nature-society relationship, as the phasing out of patriarchal relations in the household and hierarchical relations in general should create a new ethos of non-domination which would engulf both nature and society.

See also

* Anarchist economics
* Anarcho-syndicalism
* Economic democracy

References

Further reading

Books

* (Translated i
French
)
*
* Steve Best (editor)
''Global Capitalism and the Demise of the Left: Renewing Radicalism through Inclusive Democracy''
(Athens, Greece: Koukkida, 2008) ; and as a Special Issue of ''The International Journal of Inclusive Democracy'' (Winter 2009), in English.
*

Essays

Introductory essays

ed. by R.J. Barry Jones (Routledge, 2001), pp. 732–40. Retrieved 4 January 2014.
* Takis Fotopoulos interview

Transcription of a video by O. Ressler, recorded in London, Great Britain, 37 min. (2003)
www.republicart.net
Retrieved 3 January 2014.
*Steven Best
"Crisis Culture and the Waning of Revolutionary Politics,"
''The International Journal of Inclusive Democracy'', Vol. 3, No. 2 (April 2007). Retrieved 3 January 2014.

Debate on the ID project

essays on the ID project by Michael Levin, Arran Gare, David Freeman, Serge Latouche, Jean-Claude Richard, Takis Nikolopoulos, Rafael Spósito, Guido Galafassi, Takis Fotopoulos and others ( Democracy & Nature, Vol. 9, No. 3 (November 2003).
* Rafael Spósito, Guido Galafassi, Jorge Camil, Jean-Claude Richard, Takis Nikolopoulos, Takis Fotopoulos, Michael Levin, Arran Gare, David Freeman, Serge Latouche
"Debate on the Inclusive Democracy project (Parts I & II)"
''The International Journal of Inclusive Democracy'', Vol. 1, No. 2 (January 2005) and Vol. 1, No. 3 (May 2005). Retrieved 3 January 2014.

ID and education

''Critical Pedagogy in the new dark ages: challenges and possibilities''
ed by Maria Nikolakaki (Peter Lang Publishing, 2012). (Takis Fotopoulos contribution: "From (mis)education to Paedeia," pp. 81–119.)
*

' ed. by A.J.Nocella, Steven Best, Peter McLaren (AK Press, Oakland, CA & Edinburgh, 2010), 590 pp, paperback, (Takis Fotopoulos contribution,

"

ID and the New World Order

* Takis Fotopoulos

''Theomai journal'', No. 4 (2nd semester 2001)
* Takis Fotopoulos

''New Political Science'', Vol. 24, Issue 1 (March 2002), pp. 73–104
* Takis Fotopoulos

in ''Critical Perspectives on Globalisation'', ed. by Marina Della Giusta et al. (Chelthenham, UK & Norrhampton, MA, USA: Edward Elgar publishing, 2006), ch. 28. {{ISBN, 978-1-84542-176-2.
* Takis Fotopoulos, "The Muslim Brotherhood and Islamic "democracy" in Egypt as part of the New World Order,



''The International Journal of Inclusive Democracy,'' Vol. 8, Nos. 1/2 (Winter/Summer 2012)
* Takis Fotopoulos

''The International Journal of Inclusive Democracy,'' Vol. 9 (2013)

ID on Marxism and anarchism

* Tom Crumpacker

; Takis Fotopoulos

''The International Journal of Inclusive Democracy,'' Vol. 2, No. 2 (January 2006).
* Lutz Roemheld

Johannes Hilmer, ttp://www.democracynature.org/vol6/hilmer_proudhon.htm "Two views about socialism: why Karl Marx shunned an academic debate with Pierre-Joseph Proudhon" Takis Fotopoulos
"Beyond Marx and Proudhon"
''Democracy & Nature,'' Vol. 6, No. 1 (March 2000).

ID on irrationalism

* Takis Fotopoulos

''Democracy & Nature,'' Vol. 4, No. 2/3 (1998); Thomas Marti

Takis Fotopoulos

''Democracy & Nature,'' Vol. 8, No. 1 (March 2000).

Dialogues on ID

Dialogue with ecologists

A debate by James O' Connor and Takis Fotopoulos, ''Democracy & Nature,'' Vol. 2, No. 3 (November 1991–January 1993)
* Ted Trainer
"On eco-villages and the transition"
''The International Journal of Inclusive Democracy,'' Vol. 2, No. 3 (June 2006); and reply in: Takis Fotopoulos

The International Journal of Inclusive Democracy, Vol. 2, No. 3 (June 2006).

Dialogue with pareconists

*Takis Fotopoulos

''Democracy & Nature: The International Journal of Inclusive Democracy'', Vol. 9, No. 3 (November 2003); and also: Michael Albert

ZMag (9 April 2004). Retrieved 4 January 2014.

Dialogue with Castoriadians

*David Ames Curtis

C''ornelius Castoriadis Agora International Website'' (April–August 1997); reply by Takis Fotopoulos

''Democracy & Nature: The International Journal of Inclusive Democracy'' vol. 5, no. 1 (March 1999); an

- includes a brief history of all the exchanges with a constantly updated, complete webography. The Autonomy and Inclusive Democracy Projects and "Agora's" Defamatory Delirium (October, 2006); Addendum (November, 2006); P.S. (December, 2006); Appendix: A brief history of the exchanges with complete webography (July 2007).

Videos

* Takis Fotopoulos talk on the Multidimensional Crisis and Inclusive Democracy, Oxford University, November 200

Retrieved 4 January 2014.
* [http://www.inclusivedemocracy.org/fotopoulos/videos/videos_br.htm#A_talk_by_Takis_Fotopoulos_about_the_Internationalization_of_the_Capitalist_Market_Economy_and_the_project_of_Inclusive_Democracy A talk by Takis Fotopoulos about the Internationalization of the Capitalist Market Economy and the project of Inclusive Democracy].
Inclusive Democracy as a political project for a new libertarian synthesis : rationale, proposed social structure and transition

External links

* ttp://www.inclusivedemocracy.org Inclusive Democracy website
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