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DINO WILDI

12291110 dino.1996@windowslive.com

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H E S I S SU P E R V I S E D BY DR. AN N E T T E FR E Y B E R G- IN A N 2 1 . JU N E 2 0 1 9 WO R D CO U N T (E X C L U D I N G PR E F A C E) : 2 3 ’ 0 2 8

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Preface ... 3

Acknowledgments ... 3

1. Introduction ... 5

1.1. Europe in Crisis? The Need for a Vision ... 5

1.2. Why Utopia? ... 8

2. Aspirations and Reality... 11

2.1. Visions on the EU ... 11

2.1.1. Beyond state sovereignty ... 11

2.1.2. A union of sovereign peoples ... 12

2.2. Non-Domination as a Framework for the EU ... 14

2.2.1. What is non-domination? ... 14

2.2.2. Non-domination in the international system ... 15

2.3. Forms of power ... 17

2.4. Democracy and Participation ... 19

2.5. The problem with Capitalism... 21

3. Empowering European Societies ... 24

3.1. Society and the State ... 24

3.1.1. Civil Society and the State ... 24

3.1.2. Electoral Sovereignty ...25

3.1.3. Participation and Localisation ... 26

3.2. Organising Social Power... 27

3.2.1. Civil Society as an instrument against domination ... 27

3.2.2. How to build civil society? ... 29

4. A More Democratic EU ... 32

4.1. Breaking down the Institutions ...32

4.1.1. Transforming the member states...32

4.1.2. The legislative institutions and the Commission ... 34

4.2. Power to the People ... 35

4.2.1. The Case of Switzerland... 36

4.2.2. A plan for European referenda ... 38

4.2.3. A model for elite-society deliberation ... 41

4.3. Using Associational Democracy ... 43

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5. Market Socialism in the EU ... 47

5.1. Schweickart’s Model of Economic Democracy ... 47

5.2. Briniging Schweickart to Europe ... 48

5.3. Governing Social Investment ... 49

5.3.1. A European Taxation System ... 50

5.3.2. The new ECB ...52

5.4. Addressing European Inequality ... 55

5.4.1. Inequality between Countries ... 55

5.4.2. National Inequality and Social Policy ... 57

6. Conclusion ... 61

6.1. Assessing my Utopia ... 61

6.2. Limitations and Further Openings ... 63

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As someone personally identifying as leftist as well as strongly pro-European, I have had many discussions with fellow leftists over the possibility of a social, democratic and fair Europe. Sadly, too many on the left fall into the trap of equating today’s (undeniably flawed) EU with the broader concept of Europe. This is more than unfortunate, as the idea of European unity and cooperation has tremendous power to make Europe more social and strengthen the power of European citizens to control the power of capital. This thesis is a response to those on the left who call for an end to Europe and decry the EU as a neoliberal vehicle.

It has been my goal throughout the writing process to not only write a thesis that is academically satisfying, but also one whose message I can whole-heartedly support. It has not turned out to be a party program or a simple personal preaching, and my own opinion has been shaped by the research I conducted in its course just as much as my opinions may have shaped that research. But in the end, I have indeed ended up with a vision that I could stand behind, and for which I am willing to act.

The Left’s denial of Europe’s potential is a mistake. It is a mistake because it misses the potential of Europe’s political and economic power to not only bring about positive change for its own citizens, but also to use its weight internationally to create a better world for everyone. It is a mistake because it supports the more prominent enemies of Europe, those on the nationalist Right. And it is a mistake because it removes the Left’s voice from European politics, whose outcome have material effects on the lives of millions of people whom the Left claims to defend. I do not believe that a simple master thesis can reverse that mistake. But I hope that it can be a starting point for me to sharpen my argument and be a basis to contribute to a Leftist vision for Europe.

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Numerous people have contributed to this thesis and deserve my thanks. In no particular order, they are: Paul Raekstad, whose lectures have pointed me towards the concepts central to this project and have greatly expanded my own political horizon; Annette Freyberg-Inan, whose feedback and guidance has been very helpful and who gave me the initial inspiration for the entire project; P. W. Zuidhoff for acting as a second reader; Michael Vermeer, who gave helpful feedback, pointers, and took his

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time to help me in the midst of his own thesis; the Alternatives to Capitalism project group, whose feedback and literature advice has uncovered many weak spots of my initial idea; and finally Angela Caredda, who took the time to not only proofread multiple chapters individually as well as the entire thesis, but also was a great support for my sanity throughout the last four months. All those people have been a part of why I managed to finish this piece of work, and I wholeheartedly thank them for their efforts.

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“Under capitalism the smooth economic growth of individual enterprises or individual states is impossible. Under capitalism, there are no other means of restoring the periodically disturbed equilibrium than crises in industry and wars in politics. Of course, temporary agreements are possible between capitalists and between states. In this sense a United States of Europe is possible as an agreement between the European capitalists ... but to what end?”1

Today, the European Union is closer than ever to the United States of Europe Lenin discusses in this quote. Even if it may not be a United States yet, and its commitment to the famous ‘ever closer union’ may be dubious, the EU has produced extreme interconnection between the economies of Europe. By virtue of its power to govern a single market area encompassing over half a billion people, and its role in national politics of its member states, the European Union is one of the most influential polities in the world. Is it true that, as Lenin said, it is inevitably an agreement between the European capitalists? In this thesis, I will prove that the EU can just as well be a vehicle for fighting the power of capital by providing a vision of an egalitarian, democratic Europe designed to prioritise social benefits. Capitalism undermines that goal by placing the power over many economic decisions in private, uncontrolled hands; and by incentivising politicians to prioritise capital owners over the benefit of the people.

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The history of European integration has never been free of crises. Since its division over the European Defence Community in the 1950s, the European Union and its predecessors have faced turmoil over and over again. The Empty Chair crisis in the 1960s was followed by the chaos of Britain’s accession and subsequent doubts in the 1970s, the 1980’s fight over the UK budget rebate, and the struggle to achieve popular support for treaty reforms since the 1990s. Nowadays, the EU may be facing its darkest moments in what Gerda Falkner calls “a conglomerate of specific, but interconnected crises”.2 The Eurocrisis, the migration crisis of 2015 and a long-standing crisis of

democratic accountability come together to seriously question the role of Europe in the world and to reveal its capitalist character that was predicted by Lenin a hundred years ago.

1 Lenin: On the Slogan for a United States of Europe, p. 342. 2 Falkner: The EU’s current crisis and its policy effects, p. 220.

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Few episodes show both the lack of democratic accountability and the primacy of capitalism in the EU as clearly as the treatment of crisis-ridden Greece. Three sets of bailouts, ridden with heavy austerity measures, were pushed through the European and Greek institutions, and each of them cost the head of a Greek prime minister.3 As if

this were not a clear enough sign by the Greek people that the EU-IMF bailout regime was against their will, the Greek government of Alexis Tsipras shocked Europe with the announcement of a referendum over the third bailout package, which was promptly rejected – only to be signed hours later, with minimal changes, necessary to avoid Greece’s bankruptcy. Not only did the process make a mockery of Greek democracy, it also showed that it was never designed to help Greek citizens. According to former Greek finance minister and negotiator Yanis Varoufakis, the people in charge of the Greek bailout packages were fully aware that “you could squeeze blood out of a stone more easily than make a bankrupt entity repay its loans by lending it more money”.4

The entire exercise, he claims, was a way of dealing with the massive losses German and French banks had faced thanks to the increasingly large sums loaned to Greece after the formation of the Eurozone. Lacking the possibility of bailing out their banks with central bank money, Varoufakis says, the governments of these countries tried to lend the money to Greece, so that the Greek state would ‘repay’ its debts to the failing banks.5

All of this is deplorable, but it does not mean that the EU should be done away with. Europe needs to cooperate in order to be able to balance global powers like the United States on the world stage and pursue its own policies.6 However, the European

project has also been consumed by neoliberalism and market logic, and by consequence has been co-opted into the global, US-led order that Habermas and Derrida hoped to oppose.7 In order to fulfil the goal of an independent Europe that can

play a positive role for its citizens, a new vision is required to do things differently. Europe needs to move beyond capitalism and towards a truly democratically governed

3 Varoufakis: Adults in the Room, p. 43-45. 4 Ibid., p. 20.

5 Ibid., p. 23-28.

6 Derrida & Habermas: Unsere Erneuerung, p. 2.

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EU. In this paper, I want to provide such a vision. The question at the heart of this thesis is thus:

What form should a non-capitalist EU take, and how would it work?

In answering this question, I set myself two important limitations. Firstly, this thesis will not try to solve problems of the world, or to provide any change outside Europe. While it is likely that, if the project were to be successful, other countries or regions may be inspired by it and follow it, no changes outside the European Union will be discussed. Secondly, the limit of the vision is what a benevolent dictator in control of the EU could achieve. That means that while it can – and will – remodel fundamental arrangements of the EU, there is no way of remodelling basic human behaviours or bringing about complete equality between member states. Finally, as a soft constraint, when multiple measures achieve the same goal equally well, I shall prefer the one that requires less change to the status quo in order to maximise the likelihood of the vision being workable.

The goal of this vision is to provide a more democratic Europe, allowing its citizens maximum control over their political and economic fate. Thus, the primary normative value that the vision aspires to is the non-domination of citizens. In doing so, I follow the framework of economic, state and social power as described by Erik Olin Wright.8

I will combine elements of direct and associational democracy with Schweickart’s concept of Economic Democracy.9 Additionally, I will draw inspirations from the case

of Switzerland’s direct democracy and multiple recent ideas to reform European economic and social policy.

In the next sub-chapter, I will outline the value of utopian thought as a political tool and explain why I think that there is a particular need for utopian visions when it comes to the European Union. Chapter 2 then situates the thesis within the debate about the future of the EU and explains the normative aspirations behind it. It concludes with a critique of capitalism under the principles outlined in the chapter. Chapter 3 analyses the relationship between the state and society in Europe and offers a general review on the role of civil society in democracy. Chapter 4 then uses the previous arguments to

8 Wright: Envisioning Real Utopias, chapter 5.

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construct a new European policy process that would make the EU truly democratic and controlled by social power. Chapter 5 introduces Schweickart’s plan for economic democracy and adapts it to the EU, before then making suggestions for a European fiscal and social policy controlled by its people. Finally, Chapter 6 brings all threads together and assesses the vision presented in this paper against its normative goals.

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The use of utopia may not be obvious. One may wonder why we should spend time thinking about political fantasies rather than attainable improvements to the status quo that make a real difference for people. In this section, I will first outline the use of utopian thought, and then defend this approach against two common attacks. Firstly, it is argued that utopias are too far removed from reality to have an impact on society, and essentially a waste of time. However, I argue that utopian visions provide guidance to improve the status quo, as they are based on values that are relevant to current society and can be utilised to compare initially non-intuitive alternatives to each other as well as to the status quo.10 Secondly, utopian thought is criticised for inviting

authoritarianism, as “a perfect utopia can no longer be changed for the better, for the attribute ‘perfect’ carries with it the notion of ‘without any mistake’ and hence ‘beyond the need for change’”.11 In regards to this challenge, I argue in line with Böker that

utopia should be understood as a suggestion rather than a prescription.

The main function of utopia is to serve as a vehicle of criticism to the status quo. Since the collapse of the USSR, capitalism and liberal representative democracy have become almost uncontested in reality, leading to their combination being seen as an inevitable system. Without an alternative to capitalism in the real world, utopia is required to provide such an alternative in theory.12 Thus, utopia can not only serve as an ideal to guide change, but also as a trigger to create this change in the first place by challenging the status quo and motivate those opposed to it. The argument that capitalism is inevitable or comparatively better than (all) other systems can only be engaged if we have an alternative, by necessity utopian, system that we can compare

10 Valentini: A Paradigm Shift in Theorizing about Justice?, p. 8-9. 11 Böker: The Concept of Realistic Utopia, p. 90.

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it to. By constructing an alternate reality, it criticises the reality we live in and creates hope that this reality can improve.

In the context of the European Union, utopia serves yet another purpose. While the EU is nowhere near as uncontested as capitalism, criticism of the EU is often fundamental, aiming to abolish the system altogether and return to a status quo ante. Here, utopia can instead provide a positive, dialectic criticism, aiming “not to negate the existing order, […] but to create a new order that preserves what is good in the present while mitigating the irrationality and evil”.13 Applied to the EU, that means

that a good utopia could serve to combat Euroscepticism and reform the EU into a viable system. This is necessary if we want to preserve the EU’s achievements and the capacity for European nations to effectively collaborate in the face of global challenges such as climate change or the increasingly interconnected world economy.14 At this

time, I would argue that any fundamental attack on the EU needs to provide an alternative way to address problems transcending national borders. In this paper, I try to provide a positive critique of the European Union that can preserve and enhance the cooperation of Europeans in order to effectively tackle shared issues.

The first common criticism levied against utopia is that radical change to society is either not achievable or not desirable. It is argued that deliberate change of social systems is destined to fail even if the new alternative may be theoretically better than the status quo.15 The problem with this line of thinking is that incremental change is

unlikely to successfully address systemic issues unless it contains an underlying critique of the system. Individual issues can be addressed within an incremental framework, but to challenge basic structures of society that are taken for granted, we need to distance ourselves from what is considered realistic and have to think in terms of utopia.16 It is also important to note that utopia and reform are not mutually

exclusive, but that one supports the other. By providing a true critique of society and expanding the scope of that we consider to be possible, reforms become more

13 Schweickart: After Capitalism., p. 6.

14 Habermas: The Crisis of the European Union, p. 16. 15 Wright: Envisioning Real Utopia, p. 5-7.

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achievable as they are no longer seen as radical changes to social rules, but as a compromise to improve society towards the utopian vision.17

The second critique is that utopian thought is authoritarian, because it claims to have found a perfect formula. By aspiring to present a perfect society, it inherently silences critique, as perfection cannot reasonably be criticised. Its implementation would need to be similarly authoritarian in order to ensure that the utopian vision is completely fulfilled.18 However, this charge misunderstands the role of utopia. Its goal

by no means has to be a radical transformation of society, consequences be damned. Marit Böker argues for a meta-utopia, in which different visions are played off against each other and should be criticised and compared.19 This paper should be understood

as a contribution to this meta-utopia by providing a potential vision which should be discussed in comparison to both other alternatives and the status quo. By setting non-domination and participatory democracy as its normative goals, it also aims to create spaces in which such a meta-utopian discussion can take place. Therefore, not only is this thesis a contribution to a meta-utopia in the sense of Böker, it also provides a framework in which such a meta-utopian discussion could take place if my vision were to be realised.

17 Wright: Envisioning Real Utopia, p. 6.

18 Böker: The Concept of Realistic Utopia, p. 89-91. 19 Ibid., p. 93-95

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My aspiration is to provide a valid successor system to the European Union as we see it today, i.e. to provide a system that is viable economically and politically as well as ethically superior to the status quo.20 This requires outlining ethical criteria by which

to measure the ethical quality of my vision against the status quo. In the remainder of this chapter, I put forward non-domination as a framework to compare the two. I will first present an overview of previous visions for the EU, then introduce the concept of non-domination by Philip Pettit, put it into the context of different power sources and their relationship, and finally elaborate on the specifics of an international system and a democracy that fulfils the criterion of non-domination.

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Constructive visions about the EU’s future are organised alongside two major strands: On one side, there are the federalists, aiming to extend the fundamental idea of the nation-state to Europe and creating a European identity that could defend liberalism and human rights on the global stage.21 The other side is a group of ideas

that do not aim to replace the EU’s member states with a new identity, but to create more cooperation among them and form a “European Republic of sovereign states”,22

as Richard Bellamy titled one of his articles about the EU’s future. In this section, I will outline the two strands and place my own vision in this context. I shall argue for a concept much closer to Bellamy’s republic of states, but reject the nation-state as the primary unit of cooperation.

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The federalist vision comes in two flavours: some propose a sovereign federal EU that essentially becomes a new nation-state, whereas others propose a more restricted EU that is not based on the idea of sovereignty, but rather on the power of international law.23 While creating a sovereign European state would certainly give Europe the

authority to solve its common problems, it needs to tackle the problem that there is no common European public sphere or sense of common identity, lacking the legitimacy

20 Schweickart: After Capitalism, p. 11-12.

21 Habermas & Derrida: Unsere Erneuerung, p. 2-3. 22 Bellamy: A European Republic of Sovereign States, p. 1. 23 Ibid., p. 14-17.

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or popular sovereignty of a nation-state.24 This issue may or may not be overcome, but

ultimately, the formation of a common European demos that can replace national identities is neither necessary nor normatively desirable, and therefore an unnecessary burden to take on. Hence, the EU should derive its legitimacy from the consent of established political communities.

A different strand suggested by Jürgen Habermas argues that popular sovereignty should be considered independent from state sovereignty: While the latter is characterised by the state being able to act freely, the former is defined by citizens enjoying autonomy and equal liberties. The protection of these rights is not necessarily tied to a sovereign state.25 The advantage of such a cooperation-based vision is that

there is no need to justify the sovereign power of the central state, as it doesn’t exist in Habermas’ proposal. However, the problem deriving from it is that, while Habermas’ EU may be able to prevent external domination, assuming working cooperation among its members, he fails to show how it can protect the rights of its own citizens internally without the powers of state sovereignty. He then goes on to point out the double citizenship of Europeans, being part of both the EU and their national state, and to argue in favour of a civic solidarity between peoples of the EU and a common public sphere to ensure true democratic decision-making in Europe.26 However, at this point

the objections raised in the previous paragraph are valid once again, as such a public sphere would again constitute an unnecessary burden compared to legitimising the EU through consent of its constituent communities.

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A proposed vision that is indeed based on the idea of consent by constituent peoples is the concept of ‘demoicracy’ or a ‘republic of states’, posited by Kalypso Nicolaidis and Richard Bellamy, respectively.27 They reject the idea that the EU must be either a

federal state or a union of nation-states. Instead, they see the EU as a polity which has direct popular legitimacy (thus going further than an international organisation), yet

24 Cheneval & Schimmelfennig: The Case for Demoicracy in the EU, p. 337-338. 25 Habermas: The Crisis of the European Union, p. 14-19.

26 Ibid., p. 38-49.

27 Nicolaidis: The Idea of Demoicracy; Bellamy: A European Republic of Sovereign States. The concepts

have been grouped together as they are similar enough to serve as a common basis for the argument proposed.

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derives this legitimacy not from a single demos (distancing themselves from the federalists), but from its multiple member demoi.28 These demoi should recognise each

other as members of the EU and interact with each other, without actually imposing their will onto each other unless doing so is reversible and empowers the members of the demoi.29 Bellamy emphasises the role of sovereignty in this concept, which he sees

as a way of ensuring non-domination. According to him, neither state sovereignty nor supranationalism can actually fulfil that goal: pure state sovereignty is insufficient to deal with modern, transnational issues and would be overly vulnerable to external constraints; supranational sovereignty would simply shift concerns over domination on the national level to the EU level.30 While this is an extremely useful basis for the

EU’s future, it does not give a conclusive answer to why nation-states should define the constituent demoi. In this project, I shall argue for smaller and more flexible demoi, ultimately allowing people to choose their own allegiance based on locality rather than descent or mutual recognition.

Cheneval & Schimmelfennig examine this concept under the framework of democracy and provide valuable insights for this project. They characterise Bellamy’s approach as a deliberative federalism, in which the different sub-entities coordinate with each other under the frame of the federal entity, and criticise it on the basis that this deliberation is only occurring among elites. They also highlight the dual nature of a demoicracy: as it gets its legitimacy both out of the demoi and their individual citizens, demoicracy requires both parties to be represented.31 This is a very important

objection, but not one that is inherent to deliberative federalism. The vision I will present strives to create a true deliberative federalism among demoi and their citizens. It extends the idea of demoicracy beyond the sphere of the nation and understands the EU not as a union of national peoples, but of communities defined by locality or even by voluntary association. By doing so, it achieves the goals of sovereignty outlined by Bellamy better than his own Republic of States and minimises the risk of elite domination outlined by Cheneval and Schimmelfennig.

28 Nicolaidis: The Idea of Demoicracy, p. 247-251. 29 Ibid., p. 264-269

30 Bellamy: A European Republic of Sovereign States, p. 2-3.

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The first value that my vision needs to fulfil is the non-domination of the citizens under its control. For this, I will use Philip Pettit’s account of an international system based on the value of non-domination. However, compared to Pettit’s account, my vision moves beyond a system of nation-states and is specifically tailored to the EU’s particular situation. Non-domination as defined by Pettit refers to the absence of “a relationship in which one party enjoys a degree of alien control over another”.32 In this

paper, I argue that a just system should strive to minimise alien control over the people living under it. This reflects the fundamental belief that people are equal, and hence no amount of alien control can be justified, as it requires prioritising the controlling actor over the controlled.

2 . 2 . 1 . W h a t i s N o n - D o m i n a t i o n ?

What is alien control, in this case? Actor A exercises control over actor B if they act in a way that increases the possibility that B will exercise a behaviour that is preferred by A. Assume B faces a choice between three options, and would choose option 1 given an absence of A. If A’s presence encourages B to choose option 2 over option 1, this is a form of control. Crucially, it does not matter whether A actually planned to actively exercise any control over B’s choice; the sheer fact that B took the possibility of intervention into account consciously or subconsciously when making his choice means that A exercised control over B’s choice.33

Not all control is alien or bad. A life without being controlled and controlling other people would be impossible in any type of society. But we should strive for that control to be non-alien. Non-alien control can be achieved in two ways. The first one is reasoned control. Reasoned control occurs when A influences the choice of B not through an explicit or implicit threat, or through distorting the information B has, but by providing further information or insight. This could mean that A gives B very convincing reasons for why option 2 may be better than option 1. It can also mean that A offers B a reward for choosing option 2, as long as said reward is refusable. Secondly, control is non-alien if it is exercised with the informed consent of B, i.e. it

32 Pettit: A Republican Law of Peoples, p. 73. 33 Ibid., p. 73-74.

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is non-arbitrary.34 Because non-alien control does not preclude B from making an

informed choice, except with his explicit consent, it is not a form of domination and thus fulfils the criterion of non-domination.

Consider a football club that needs to make a decision on whether to organise a football tournament in summer. The members of the club will all have to help organise the tournament, so the decision will affect their behaviour. The members of the club are under the control of the club, however they are not dominated by it. Every member of the club can try to persuade their fellow members to choose their preferred option, therefore any control over another member’s vote is exercised in a reasoned way. Secondly, members have previously agreed to the rules under which decisions are made (by joining the club) and can leave the club without any major consequence if they no longer agree with the rules of the club. Therefore, the control exercised by the club is not arbitrary, but collectively exercised by its members, and thus the criteria of non-domination are fulfilled.

The concept of popular sovereignty, which is at the heart of democracy, serves as a mechanism to ensure domination on a national level. In order to ensure the non-domination of their citizens, states must ensure democratic representation and minority protections.35 The international system’s first role in securing non-domination is to

protect its citizens against domination from its member states in the same way that the state is tasked with protecting its citizens from domination by their fellow citizens.36

However, states can also be dominated themselves. Such domination corrupts the idea of popular sovereignty even in a perfectly democratic state, as the people in their role as sovereign cannot freely choose among their options anymore. Thus, they are placed under alien control if their state is dominated. The second role of an international system in ensuring non-domination is to prevent domination of its member states. 2 . 2 . 2 . N o n - D o m i n a t i o n i n t h e I n t e r n a t i o n a l S y s t e m

What are the forces by which states can be dominated, and how can the international system address them? Firstly, states can be dominated by other states. The most obvious instance of this would be military interference, but domination among st ates

34 Ibid., p. 75.

35 Bellamy: A European Republic of Sovereign States, p. 8-10. 36 Pettit: A Republican Law of Peoples, p. 80-81.

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can be much more subtle.37 For example, in the EU, the conditions placed on Greece

in order to obtain a bailout during the Eurocrisis could be considered a form of domination, as the EU could dictate the terms of the bailout Greece received to a large degree. A just international system must strive to alleviate power inequalities among its countries. This should be done both by addressing the actual source of this inequality (usually economic imbalances among states), and by restricting the exercise of power by states over each other, for instance by creating an internationally binding rule of law.

Secondly, states can be dominated by private institutions. The prime example for this are multinational corporations, which often hold considerable power over states by controlling a large part of available jobs, or by interfering with the political process in the state.38 An example of private domination of a state would be the threat of

companies to relocate if the state they reside in were to increase their corporate tax rate. Given that this form of domination is largely dependent on the possibility of playing states off against each other, any form of unity among states that try to avoid such domination greatly limits the efficiency of private domination.39 A just system

thus needs to encourage such unity, and strive to limit the power of private institutions over states.

In this chapter, I have so far outlined what non-domination entails and how both citizens and states can be dominated in the international system. A just international system needs to achieve three things. Firstly, it needs to prevent the domination of citizens by their states. This is achievable through providing a check on its member states through a binding court of justice. Secondly, it needs to prevent the domination of states by other states, by alleviating inequalities among the states and creating binding rules for its members; in doing so, it plays a role similar to the state’s role for its citizens. Thirdly, it needs to protect its members against private domination by uniting its members against such attempts and restricting the power of private entities that could exercise domination.

37 Pettit: A Republican Law of Peoples, p. 77-78. 38 Ibid.

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Power is a contested and thus also somewhat vague concept. In this paper, I shall base my understanding on Wright’s definition of power as

“the capacity of actors to accomplish things in the world […] it is instrumental in that it focuses on the capacities people use to accomplish things in the world; it is structural in that the effectiveness of these capacities depends upon the social structural conditions under which people act”.40

Power, thus, is inherently connected to non-domination. As in a society most actions do affect the behaviour of other people, the capacity of actors to accomplish things is almost always connected to their capacity to affect the choices of other people. Thus, an actor that uses their power in a way that affects another actor’s behaviour exercises control over that actor. In order to minimise domination, we need to ensure that the exercise of power is tied to the consent of those affected by it.

Wright broadly distinguishes three types of power: economic, state, and social power. Economic power refers to the capacity to affect the production and distribution of goods and services, and largely derives from the control over resources. State power refers to the capacity to enact universally binding rules over a defined territory that govern social relations at large, and largely derives from control over infrastructure as well as legitimate use of force. Social power, finally, is the capacity to govern social relations through voluntary association.41 These sources of power are related to each

other, as the wielder of one form can use it to affect the wielder of another. A classical example for such interaction would be a large company threatening to move away from a country if the country passes new economic regulation. In this case, the company uses its economic power (the control over production of a certain good as well as over the distribution of a large sum of money via wages and investments) in order to affect the use of state power by the government. If that action then prevents the regulation, state power would (in this particular case) be subjected to economic power. The balance of the three sources of power largely defines the structure of the state.

40 Wright: Envisioning Real Utopias, p. 73; emphasis original. 41 Ibid., p. 78-79.

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Both economic and state power are coercive in their nature. Economic power uses the possibility of withholding resources that may be vital to an actor’s survival to affect that actor’s behaviour, while state power relies on its monopoly on violence to enforce its rules. Additionally, both are not inherently checked or reasoned in any form. In the present system, economic power is often used in an authoritarian way: Whoever owns the capital gets complete control over it, and therefore also the people depending on it for their livelihood both before and after they enter a contract with the owner (i.e. a labour contract).42 State power can similarly be used in a repressive, dominating way

as we see in a number of authoritarian states around the world. In democracies, we try to limit the dominating potential of state power, but there is still a lot of room to use state power in a dominating way. An example could be the use of force by police units, which happens without the consent of those affected.

The case of democracy then points us to the way the coercive nature of state power or economic power can be controlled: by placing them under the control of the one non-dominating power, namely social power. Due to its voluntary basis, social power is under most circumstances not dominating. If we follow the definition above, social power manifests itself through voluntary association, which means that the association can also be ended voluntarily. However, in the status quo, civil society – the seat of social power in most polities – does not have much control over either the economic or the state sphere. In the economy, the only influence of social power comes through labour unions, whose influence is often limited to either lobbying or collective bargaining, rather than having a clear role in the legislative process. In the sphere of the state, civil society can play an important role, but is competing for attention with economic actors and the personal interest of state actors. In order to truly constrain the dominating potential of the other forms of power, the economy and the state must both be brought under the control of social power. These suggested power relations will shape the rest of this thesis: In chapter four, I will answer the question of how to bring the economy under social control, while chapter five will do the same with the state.

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2 . 4 .

D

E M O C R A C Y A N D

P

A R T I C I P A T I O N

In order to check the power of leaders and therefore avoid alien domination of citizens by their states, there needs to be meaningful participation of people in the political process. In order to achieve meaningful participation, two conditions need to be satisfied. Firstly, the institutional setup of the state needs to be designed in a way that forces leaders to govern through reciprocity rather than through unilateral decision-making that is independent from popular will. Secondly, it needs to ensure that the electorate is sovereign, i.e. “Its members are reasonably well informed about the issues to be decided by the political process and reasonably active in contributing to their resolution. There exists no stable minority class that is privileged”43. In the rest

of this chapter, I will outline the distinction between hierarchical and reciprocal government and the concept of a sovereign electorate, and derive criteria for my vision from them.

In each society that needs to be organised by a central authority, there are two conflicting tendencies: one towards hierarchy and one towards reciprocity. The former means that societies tend to unequal power relations, in which some people have more power due to differences in various characteristics. The latter means that even in a hierarchy, the leaders need to benefit their supporters in order to not lose their support and risk their position.44 In order to achieve egalitarian democracy and ensure that no

actor dominates the citizens by controlling the political process, hierarchic tendencies need to be limited as much as possible. While it is impossible to remove it entirely, as differences in skill, knowledge, opportunities or status are present in any society, there are conditions which increase the tendency towards reciprocity. Dahl and Lindblom identify these conditions with the possibility for non-leaders to switch their allegiance and install a new leader through political competition.45 However, this only helps when

the competition is truly responsive and open. If there are high hurdles to entering the political competition, and non-leaders have few options to choose from, or leaders are being shielded by other interests, formal competition does not necessarily ensure a high level of reciprocity. In order to achieve this, we need what Wright calls ‘thick

43 Schweickart: After Capitalism, p. 105.

44 Dahl & Lindblom: Politics, Economics and Welfare, 279-285. 45 Ibid.

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democracy’, i.e. one in which the people have a meaningful choice between multiple, qualitatively different options as well as the possibility to provide new options of their own.46

However, in order to achieve deep or egalitarian democracy47 we require an

electorate that is capable of participating in this process. If we were to imagine a country in which everyone could submit a proposal that is then subject to a binding referendum and any government member could be recalled at any point by their voters, the requirements of thick democracy would seem fulfilled procedurally. However, let us now assume that half the country is illiterate, and only a small elite (say, five percent) have access to any sort of mass media. Surely, this is not an egalitarian system: The people who cannot read the proposals are at the mercy of those who can to know what they vote for; and those with access to media are much more likely to be properly informed of the consequences. Similarly, if the procedure is overly complicated or lengthy – maybe one would have to personally attend a long assembly to participate, or many would work on voting day, like in the US – this would disadvantage certain people even if the procedures are strong.

Robert Dahl suggests the following:

“First, a process may ensure that decisions correspond with my own personal choice. Second, a process may ensure decisions informed by a special competence that would be less likely under alternative procedures. Third, a process may be less perfect than other alternatives according to the first two criteria but, on balance, more satisfactory simply because it economizes on the amount of time, attention, and energy I must give to it. Let me call these respectively the Criterion of Personal Choice, the Criterion of Competence, and the Criterion of Economy.”48

The problem with Dahl’s suggestion is that there is no indication as how to balance the three criteria out. Dahl sees participation only as a means to protect personal interests. Therefore, participation is almost treated as a cost to be traded off against

46 Wright: Envisioning Real Utopia, p. 108.

47 There seems to be an (implicit) distinction between the terms in Wright’s work, where deep democracy

refers to increased participation and egalitarian democracy refers to reduced power imbalances between groups of people. However, the distinction is rarely made explicitly, and for good reason: If people are being given more avenues for participation, this inherently tends to undercut elite rule as it forces leaders to be more responsive, or they will be either replaced or ignored by the people. Therefore, I will use the terms synonymously.

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competence and effort, leading to a tension that is not resolved in his work.49 However,

by stepping away from Dahl’s justification and replacing it with non-domination, there is a new way of balancing the criteria: A political system shall balance the three

criteria of Personal Choice, Competence and Economy such as to minimise power indifferences that could lead to domination. In practice, that means that participation

should be prioritised unless 1) doing so would lead to major differences in competence among people, or 2) doing so would convolute the process to a degree that practical participation is no longer feasible. Importantly, that means that ensuring a certain outcome is not a concern for my vision. In order to be truly non-dominating and participatory, it needs to be agnostic towards people’s wishes, as imposing any goals or policies other than those required to ensure non-domination would be a form of alien control (by the political system) in itself. Thus, if participation would lead to people making decisions that we see as ‘bad’, but they perceive to be in their interest, that is a legitimate decision that should be respected.

2 . 5 .

T

H E

P

R O B L E M W I T H

C

A P I T A L I S M

Capitalism is fundamentally built on competition and domination. Previously, I named the conditions necessary for hierarchical and reciprocal government, and for a sovereign electorate. Capitalism is set up in a way that produces power imbalances and therefore leads to both hierarchic government within capitalist companies, and to an undermining of democracy in wider society. Differences in power and a lack of political competition50 for leadership are likely to lead to centralised and unresponsive

government. These conditions are always present in capitalism. Firstly, if power is distributed based on who can afford to buy shares of a company (or set up their own), there is little to no competition for leadership. That means that there is nearly no reason for reciprocity between business leaders and workers.

One may argue that employers need to show some reciprocity in order to attract and retain workers. However, according to Gourevitch51 there are two reasons why

this fails. Firstly, the workers are inherently in a weaker negotiating position, as they

49 Krouse: The Changing Democratic Theory of Robert Dahl, p. 455-458.

50 I understand political competition as competition based on gaining the support of the people one intends to

govern, i.e. competition through arguments and gaining people’s consent to be led by the leader.

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depend on the labour contract in order to be able to survive and cannot refusea flawed contract without putting themselves at great risk. Secondly, the conditions of labour are often unknown at the time of signing the contract or may change later on, and it is hard for workers to affect their conditions. In combination, this means that the labour market structurally produces market failures, because the workers do not have meaningful alternatives and therefore cannot exercise control over their leaders. As workers are unable to refuse to participate in the market without facing consequences that they cannot be expected to accept – poverty and even, in the worst case, death – they are being structurally placed under the control of the capitalist class.52

Secondly, capitalism undermines the democratic control we have over our states due to the political power associated with capital. As Dahl and Lindblom write: “The function of businessmen is to be ‘public officials’ even if they are not government officials”.53 Because capitalists control the resources of society, they can control

societal developments to a large degree. Take, for example, investments which tend to be concentrated in areas which see high economic activity already, as these promise higher returns. Due to these investments, the economy in these areas is successful, making the initial investment a self-fulfilling prophecy. This creates a pressure on governments to act in a manner that is compliant with business interests, as a lack of investment quickly leads to economic decline, and subsequently the removal of the leaders who are seen to be responsible for this decline.54

It is important to note that this – like most forms of capitalist domination – is not the result of a global conspiracy of evil capitalists. The power of capital lies in the organisation of social processes through markets. This means that processes such as investment are governed by competition, in which every actor needs to act according to market logic, i.e. maximising their personal benefit, as nothing else is under their control. Not complying with the market logic would mean to lose one’s livelihood, as the consequence would be to no longer receive services from society.55 In the example

of investments made in the previous paragraph, if a region decided to not follow the

52 Ibid.

53 Dahl & Lindblom: Politics, Economics and Welfare (New Preface 1976), p. xxxvii. 54 Schweickart: After Capitalism, p. 52-53; 109-110.

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demands of business, capitalists would not start a concerted effort to remove all their investments from the region. They would simply withdraw their own investments in order to move them to a place that promises them a higher return, but at the same time they deprive people of their livelihood and therefore force them to revert the decision that caused the capital flight to begin with. This is why markets are a particularly effective form of domination: The action desired by the dominator is not achieved by force, but is “chosen” by the dominated. However, as the choice to participate in the market is not a free choice (as there is no alternative), it is a form of alien control that imposes the market logic on everyone. Hence, people lose the ability to act against their domination, as it is not enforced by an entity they could resist, but by structural circumstances that force them to behave in a certain way or face major disadvantages.

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3 .

E

M P O W E R I N G

E

U R O P E A N

S

O C I E T I E S

As I have outlined in chapter 2, political power needs to be transformed to be more responsive to society by becoming more participative and encouraging civil society participation. In this chapter, I will first describe three ways in which the relation between society and state is governed and then go on to describe the role of civil society and how to improve it. The next chapter will then build on the work done in this chapter to suggest European institutions that can subordinate the state to society.

3 . 1 .

S

O C I E T Y A N D T H E

S

T A T E

While a democratic state usually claims to represent society and derives legitimacy from its mandate to do so, it is not the same as society. The relation between the state and society as a whole can range from a hierarchical type where the state reigns over society to one in which the state is subordinate to society. The relationship between the two is affected by a number of political, cultural, and social variables. In this sub-chapter, I will look at three factors that are relevant for the rest of the chapter: The role of civil society, the concept of a sovereign electorate, and the territorial scope of politics.

3 . 1 . 1 . C i v i l S o c i e t y a n d t h e S t a t e

Civil society is an old and contested concept that can include a range of social organisations, but generally refers to voluntary association outside the scope of the state. In this paper, I will use the definition of Jan Aart Scholte, who understands civil society as a space where people voluntarily associate to shape the rules governing them without pursuing public office or profit.56 This not only refers to rules in the sense of

official laws, but also includes other formalised practices such as typical labour contracts and corporate policy, or social rules like how we typically treat other people. This definition is very diverse, as it can include everything from business interest groups and NGOs to churches or networks for migrants. Nonetheless, these groups have something in common: They express social power outside the realm of the state. This sort of cooperation serves two important roles. Firstly, it organises society in a much more flexible way than the state can. Because this kind of association is voluntary, it is much less likely to be dominating than state power is. The risk of a civil

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society organisation being led in a dominating way of course persists, but people who disagree with the association can leave it much easier than they could leave a state. As a source of organisation, it provides cohesion and social services that the state would otherwise have to provide.57 In the same function, it can act as a watchdog and provide

additional accountability.58 Secondly, civil society acts as a source of trust and

connection between citizens. If organisation occurs based on trust, people are more likely to comply not only in word but also in spirit, rather than working for personal benefit.59 This is a basic requirement for functioning democratic governance, as in a

society in which people do not recognise each other as members of a common group they are likely to see each other’s demands and views as illegitimate and pursue personal gain or be played against each other by a leader seeking personal gain.60

3 . 1 . 2 . E l e c t o r a l S o v e r e i g n t y

Even with a well-designed civil society, some state power would be required to ensure that people are not placed under domination by actors of civil society either by an organisation placing an undue cost on the act of leaving it (for example, a faithful person may find it difficult to leave a church) or by associations being able to influence other people’s lives regardless of their membership (for example by being the only ones to provide a certain non-profit service). State power also has the benefit of setting rules that are universal within its territory, and has the capacity of enforcing them where voluntary association may fail. It seems quite clear from this that we should not completely forsake state power, even if we were able to ensure a strong civil society. How do we ensure that this state power is not used in a dominating way?

A non-dominating state must make sure to not be partial towards any particular interest. As we do not have access to some external, neutral ruler, popular sovereignty and democracy serve as a solution by providing “an impartial mechanism that offers a public means for showing equal concern and respect to the views and interests of all citizens”.61 In order to achieve this, the views and interests of all citizens must actually

be considered equally, and the citizens should have somewhat equal chances to form

57 Fukuyama: Social Capital and Civil Society, p. 8.

58 Scholte: Civil Society and Democracy in Global Governance, 293-295. 59 Fukuyama: Social Capital and Civil Society, p. 6-9.

60 Bellamy: A European Republic of Sovereign States, p. 9. 61 Ibid., p. 8.

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informed interests and views. If this is not given, certain individuals have the capacity of dominating others, either by presenting wrong or partial information that prevents people from forming their views or by discounting their views. If the electorate is “reasonably well informed about the issues to be decided by the political process and reasonably active in contributing to their resolution”,62 and there is nobody who has

political power that is not either directly or indirectly accountable to the sovereign people, we can speak of a sovereign electorate. 63

3 . 1 . 3 . P a r t i c i p a t i o n a n d L o c a l i s a t i o n

The third major question is the scope on which political decisions should be decided. Traditionally, the nation-state was the primary unit of politics; however, this model of central control has recently unravelled and been replaced by different forms of multiple interconnected and overlapping jurisdictions.64 Here, I will argue that this

is necessary for non-domination. To achieve this goal, decisions must be taken at the

smallest possible level that includes all those affected by the decision.

If not all affected members of society are involved, there is a possibility that their concerns are being overruled and they are simply forced to comply with the decision, or bear its consequences. Thus, they are forced to alter their behaviour due to alien control and are being dominated. If more than all affected members are present, chances are that the results are worse in regards to personal choice. As the number of people involved in a decision, but not affected by it grows, there is a higher chance that they may prevent the course of action preferred by those affected. This can happen by the un-affected simply outvoting the affected (for example because the preferred solution of those affected goes against what they think is best), or by them not putting any effort into the action because they do not care about whether it is successful. In either way, the people affected by a problem or a decision need to live with its consequences against their will and are being dominated. The EU already shows examples of this. The most prominent one is the Euro, which is not governed by the EU as a whole, but by a set of institutions designed to include those countries which use the Euro and are thus directly affected by the EU’s monetary policy.

62 Schweickart: After Capitalism, p. 105. 63 Ibid., p. 106-107.

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I propose that this principle should be extended to the sub-national level. For example, a decision concerning shipping on the Rhine should not be taken by countries, but by the cantons, provinces and states on its shores. Such an arrangement is more likely to be efficient, better tailored to the respective needs of local communities, and more flexible.65 Similar to civil society, this flexibility reduces

domination as people can affect a smaller community more easily as well as being able to choose their community more freely.

3 . 2 .

O

R G A N I S I N G

S

O C I A L

P

O W E R

Every society has an enourmous capacity of social power. If people are willing to work together, their effect can be gigantic. But in order for them to have any effect, they need to cooperate. This is the primary role of civil society. In the previous sub-chapter, I have given a definition of civil society and an overview of its role in a democratic state. Now, I will describe why a stronger civil society is required for a non-dominating democracy and what measures we can take to strengthen the European civil society.

3 . 2 . 1 . C i v i l S o c i e t y a s a n I n s t r u m e n t A g a i n s t D o m i n a t i o n

I have previously introduced the idea that state solutions should be taken on the lowest possible scale that encompasses all affected people. This guideline concerns itself only with the territorial scale on which decisions should be taken. However, it does not question whether the state is the right actor to take an action. But many actions do not concern everyone within a certain area. For example, say that our football club from Chapter 2 has a dispute over whether to buy new goals. If the members pay for them themselves, they are the only ones to be affected by the decision. It would seem absurd and contrary to our previously established principle to demand that the local government decides on whether to buy new goals, as most of the people involved in that decision will not be affected either way. Instead, the people involved – the club members – get to decide on how to use their own money. Civil society is required to allow for such decision-making, as the bodies making these decisions are by definition civil society organisations.

65 Ibid., 237-239.

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This explains why civil society may improve the lives of citizens; but I have claimed that it in fact necessary for a non-dominating order. This is because of its role in organising social power. As Erik Olin Wright states, democracy “does not really mean, ‘rule by the atomized aggregation of the separate individuals of society taken as isolated persons’, but rather, rule by the people collectively organized into associations in various ways: parties, communities, unions etc”.66 An atomised democracy means

that people can only vote for their personal preference, which is more often than not economic because of the daily need to participate in the economy in order to survive. In such a world (like the status quo), economic and state power reign supreme because they do not rely on coordination of people. Just like unchecked market conditions make it hard to make any deliberate choice outside of market logic because of the uncertainty and lack of influence regarding the other participants,67 an atomised democracy makes

it hard to make any deliberate choice outside of self-oriented status quo logic for the same reason, essentially eliminating social power. Thus, citizens are condemned to choosing between the candidates offered to them by those in control of the remaining forms of power, economic and state-oriented.

Even the amount of democratic participation present in such a case would be likely to yield dominating results without some amount of civil society. In order to be able to take legitimate democratic decisions, a people needs to understand itself as such. That means that citizens need to understand themselves as part of an interdependent, mutually shared public society. Only then will they not take decisions to achieve personal gain and try to impose their own will on others, but try to further the common good.68 In an atomised society, where trust among citizens is low and people tend to

only trust those to whom they have a personal connection (such as family), society as a whole tends to be seen as something to either be ignored or exploited.69

The role of organising the citizenry is particularly important in modern multi-level international arrangements such as the EU or the UN, which rarely include direct democratic accountability for their members. This leads to a disconnect between the

66 Wright: Envisioning Real Utopias, p. 79-80. 67 Roberts: Marx‘ Inferno, p. 83-86.

68 Bellamy: A European Republic of Sovereign People, p. 9-10. 69 Fukuyama: Social Capital and Civil Society, p. 7-8.

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scope of political action (multinational or even global) and the scope of political contestation (primarily national), a problem that gets exacerbated given the relatively low importance that people give to the international level.70 This lack of a civil society

on the European level is at the core of the European democratic deficit in the status quo: The lack of social power on the European level means that European politics, even where they are democratically legitimised (e.g. the European Parliament), still are mainly seen through a national lense. In a sense, what currently happens in the EU is exactly what Fukuyama describes for societies with a low radius of trust: As people do not understand themselves as members of the EU, but members of their states, they use the European elections as a vehicle to achieve the best possible result for the community they consider themselves to be part of, their national state. In order to change this, we would have to create more mutual trust and pan-European social capital.

3 . 2 . 2 . H o w t o B u i l d C i v i l S o c i e t y ?

What are then the forces that create such atomisation, and how can we alleviate it? It seems that civil society comes from two things: Primarily, people need to have social capital, i.e. they need to have a mutual understanding of certain norms that let them see each other as equals.71 Secondly, they need to have a reason to associate, and their

associations need to be able to actually achieve something. People join civil society associations “because they can, because they want to, or because they were asked”.72

Few people want to join a group that they feel is useless, or does not achieve its goals; and few people join a group if they need to spend most of their time ensuring that they will survive.

The first part – “because they can” – is strongly tied to material well-being. As civil society engagement necessarily takes time and effort, people need to have sufficient leisure time and a secure enough livelihood to be able to join a civil organisation. This argument is empirically supported in the post-communist countries of Eastern Europe, where countries with high inequality, poverty and insecurity (which are all closely

70 Scholte: Civil Society and Global Governance, p. 289-292. 71 Fukuyama: Social Capital and Civil Society, p. 7.

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correlated) show a significantly lower participation rate in civil society organisations.73

These problems should be largely alleviated through the economic model laid out in the following chapter, which transforms firms into democratic cooperatives which share their revenues among their workers. As this model is designed to limit the amount of inequality and poverty in the country and ensure citizens have a more secure future, it also leads to more material security for people.

Economic democracy also enhances the availability of civil society organisations, since every firm is essentially set up in a way that is similar to them. While a cooperative still operates primarily with profit incentives in mind, and thus is not a civil society organisation, it could fulfil certain functions of civil society, such as providing a form of association or acting as a control on government. Even when there is no direct role for the cooperative in civil society, people will cooperate democratically in it. As social capital is built by regular interactions among people, especially if they are aimed at cooperation, this should increase the trust people have into each other and thus their will to associate in voluntary organisations.74

However, the availability of civil society organisations and the capacity for people to join them are not yet enough to make sure they will join them. After all, most people have interests outside the scope of politics, and they may prefer to spend their time in non-political associations such as a sports club, or simply stay at home and read or watch TV. Individually, there is nothing inherently wrong with such a choice if a person truly believes it serves them best. However, if people choose that option because they believe that there is no possibility for them to get politically involved except through the state (i.e. by elections), the choice no longer is taken on a free, informed basis. Instead, it is imposed onto the person and thus a form of domination. The state, in order to avoid this domination, should therefore be tasked with making sure that civil society organisations can participate in governance in a meaningful way. If citizens feel that their contribution is meaningful, they are more likely to devote their time to a civil society organisation as well as more likely to believe in the values of democracy and have faith in the institutions of the state.75 Once again, economic

73 Ibid., p. 324-327.

74 Fukuyama: Social Capital and Civil Society, p. 13.

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democracy and civil society go hand in hand, as people in cooperative firms will experience first-hand how their contribution can lead to meaningful change in a major part of their life.

What is then the role of the state in this endeavour? The state should do three things: Firstly, it needs to ensure civil society can exist. This is achieved by giving people the security they need to be able to participate in civil society as well as by supporting and strengthening existing organisations. Secondly, it needs to ensure that civil society can effectively participate in politics. Thirdly, it should prevent civil society organisations from being oppressive themselves. There is nothing in the nature of civil society organisations that ensures they are good actors – like any democratic system, they could be governed by demagogues or fall prey to a tyranny of the majority.76 But contrary to a democratic state, there is a supreme power above civil

society organisations, and states should use their power to ensure that civil society organisations respect the human rights of all members of society. However, state action must be strictly limited to specific criteria pertaining to human rights and democratic control of civil society organisations, in order to ensure that states will not use their power to control civil society. By following these three recommendations, we empower society as a whole (and thus also its individual groups) to participate in the political process and shape its future without domination by the state. In the next chapter, I shall present suggestions for an institutional design that achieves these goals.

76 Wright: Real Existing Utopias, p. 93-94.

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