Freedom and Market
Socialism
Amie Moss
University of Amsterdam
Master Thesis Political Science
Specialisation Political Economy
August 2018
Supervisor: Paul Raekstad
Second reader: Michael Eze
Word count: 19,514
Student number: 11758317 amie.l.moss@gmail.com
Contents Page
Introduction 4
1. Freedom 9
1.1 Overview of Concepts 9
1.2 Sen’s Capability Approach 12
2. Market Socialism 17
2.1 Overview 17
2.2 Economic Democracy 20
2.3 A Note on Comparisons 22
3. The Labour Market 24
3.1 What is the Labour Market? 24
3.2 Alienation 27
3.3 Alienation and Creativity 31
3.4 Abstract Time and Capabilities 34
3.5 The Labour Market and Market Socialism 37
3.6 Conclusion 40
4. Market Psychology 42
4.1 Market Psychology 42
4.3 Market Psychology and Market Socialism 48
4.4 Conclusion 49
Conclusion 50
Introduction
Freedom is one of the most potent political ideas and has dominated thinking for centuries. It follows that throughout history, questions surrounding freedom have been of central concern in philosophy and political theory and continue to occupy these fields. We also see the term freedom featuring prominently and often being appealed to in politics. Furthermore, in the past and in the present, freedom motivates countless political movements worldwide. Ultimately, freedom is the essence of humanity and thus our pursuit to understand and achieve it is ingrained in us. It is natural, therefore, that we seek a socio-economic system which can provide for freedom. Among socialists it is firmly believed that our current system – capitalism – cannot in any circumstances secure freedom. Thorough and convincing critiques of capitalism have been established by socialist scholars and attention has increasingly been on what alternatives to capitalism there are. Although sharing a common detestation for capitalism and the myriad of injustices it produces, socialism is a very broad umbrella term which encompasses many different models and ideas. Within the socialist tradition, there exists a school termed Market Socialism. Market Socialists have systematically presented an alternative socio-economic model to capitalism and although it is not a new idea, it is currently one of the main topics of debate amongst the left-wing (Ollman, 1998).
Market socialism essentially sets out to achieve the socialist values of freedom, equality and fairness in the context of the market. In light of this endeavour market socialists propose removing the capitalist class by socialising the means of production. However, unlike traditionally conceived socialism, they advocate keeping the market as a price setting and resource allocative mechanism principally for reasons of efficiency (Arnold, 1994). It follows that market socialism would be made up of citizen or worker-owned (and potentially managed) firms who relate to each other and to consumers in standard market-contractual fashion (Cohen, 1991). However, even within the market socialist school there are various models with varying details. It is worth noting that there tend to be two types of market socialists. There are market socialists, for example Alec Nove, who believe that although market socialism cannot fully satisfy socialist standards, they advocate it, arguing that it is a vast improvement upon capitalism and is the best we can hope for at present (Nove, 1983). Then there are other market socialists, such as David Miller and David Schweickart, who believe that the market has virtues which make it a desirable aspect of our long-term
goal (Miller, 1989; Schweickart, 2002). In other words, this later type of market socialist advocates market socialism as an end goal; a desirable economic system. They hold that although within the context of capitalism, the market produces undesirable and unjust outcomes, embedded in a different system, the market’s impact would not be the same. Much of the current debate on market socialism focuses on the theory of economic coordination, i.e. the economics of a plan vs a market (Hodgson, 1988; Auerbach, Desai, and Shamsavari, 1988; Elson, 1988.). Discussion on specific aspects of market socialism, for example, the universal grant, also features prominently (Purdy, 1988; Przeworski, 1986) as do questions surrounding the benefits and feasibility of true work-self management (Wolff; Jossa, 2010) and the transition to market socialism (Wright, 1986; Nove, 1986.).These questions are important, and they are, in fact, necessary preconditions for discussing market socialism’s potential to secure our values. However, I would argue that the current debate on market socialism risks losing sight of the more fundamental issue of values. Advocates of market socialism often refer to the freedom from capitalist exploitation that it will provide (Wolff). Furthermore, socialist scholars such as Cohen (Miller, 2014), Ticktin and Ollman (Ollman, 1998), have produced thorough critiques of market socialism and they often make arguments implicitly relevant to the question of freedom. However, despite the fundamental importance of freedom, there has not been any work explicitly evaluating market socialism’s impact on freedom. The aim of this paper is to fill this void and thus the question it seeks to answer is: From the perspective of freedom, is market socialism a desirable economic
system?
There are, of course, various different concepts of freedom. This paper will take as its basis one specific concept of freedom: Sen’s Capability Approach. Sen’s Capability Approach conceptualises freedom as the capability to do and be things that a person has reason to value (Sen, 2000). Key to Sen’s Capability Approach is the notion of capabilities. Capabilities (or freedoms) refer to the alternative functionings (beings and doings) that are feasible for an individual to achieve. I have chosen to use Sen’s Capability Approach over other conceptions of freedom as I believe it captures the essence of freedom well and it provides the most useful framework for my endeavour. My motivation in this respect will be further explored in section 1.1. Likewise, I will take one specific model of market socialism developed by David Schweickart: Economic Democracy. The reason I have chosen to take his model as my point of reference is two-fold. Firstly, Economic Democracy is the most detailed model to date, in
that Schweickart has outlined it with great specificity (Schweickart, 2002). Secondly, Economic Democracy incorporates worker self-managed cooperatives, rather than simply worker or citizen-owned enterprises. This is significant because worker self-management is undoubtedly an improvement upon simple worker or citizen-ownership from the perspective of freedom because it gives workers democracy in the workplace. It follows that Economic Democracy is currently the strongest model of market socialism and thus the most suitable basis for evaluating market socialism.
The argument made in this paper is that market socialism impedes freedom, understood as capabilities, in various significant ways. To summarise the arguments developed throughout the paper: two constitutive features of market socialism, namely the labour market and market exchange in general, make the economic system detrimental for freedom. A fundamental component of market socialism is the labour market which has inescapable, negative consequences for freedom. The labour market alienates individuals in significant parts of their life and this alienation curtails our creative capabilities. Creative pursuit is an important capability in its own right, however, more significantly, creativity is vital for development. In limiting development potential, alienation effectively limits the range of capabilities available to us, now and in the future. Furthermore, when we exchange our labour on the labour market, time is transformed into abstract time; quantity not quality becomes the focal point of life. Abstract time has a detrimental impact on our freedom in numerous ways. Firstly, abstract time means that all experiences feel empty and thus we do not have the freedom to experience our chosen life to the fullest. What’s more, abstract time, with its emphasis on quantity, limits our leisure time, an important capability. In a similar way, abstract time denies us the ability to be idle and thus to reflect upon what type of life we have reason to value. Market exchange in general also impedes freedom because of the “market psychology” it results in. Specific economic structures parallel certain visions of the world, and market exchange fosters competition and feelings of mistrust and hostility. This precludes cooperation and meaningful social relations. The ability to have healthy social relations is an important capability in itself, one that is denied to us by market exchange because of “market psychology.” In addition, cooperation is a precondition for development, and thus in limiting the potential for cooperation, market exchange limits the capabilities available to us. In sum, the market leads to alienation and market psychology, and these results, via various mechanisms, negatively impact upon our freedom. Thus, the conclusion
of this paper is that due to its market component, market socialism is not a desirable economic system from the perspective of freedom.
My argument focuses on two consequences of the market: alienation and market psychology. I have chosen to focus on these two aspects because their impact upon freedom is far-reaching and significant, and as will be demonstrated, they are inescapable in the context of market socialism. This is not to say, however, that the consequences for freedom that are discussed in this paper are the only ones caused by the market aspect of market socialism. There are many other problems resulting from the operations of the market. For example, periodic economic crises and pervasive corruption that would continue under market socialism (Ollman, 1999), would have a negative impact upon freedom. However, each of these issues is a large topic in itself and a thorough analysis of each is beyond the scope of this paper. Nevertheless, this paper demonstrates that market socialism impedes our freedom in fundamental ways.
Of course, freedom is not the only value worth pursuing. Although I believe that freedom is the most important value and a prerequisite for a dignified existence, others may argue that trade-offs are necessary, and that we must sacrifice some freedom for some of another value. In any case, to discuss such trade-offs we must be able to say something about how much of each value a system can provide for. Thus my research, in demonstrating some of the significant ways that market socialism impedes freedom, is of the utmost importance for discussions on socialist alternatives to capitalism. Furthermore, it is worth noting at the outset that in contrast to the initial reaction of some readers, my conclusion does not necessarily lead to an acceptance of a centralised command economy. Despite the common dichotomisation of a centrally planned and market economy, there are not only two ways of allocating resources. Largely automatic planning mechanisms can be imagined, as can de-centralised participatory plans. Indeed, the model Participatory Economics provides an idea of such a system. Furthermore, it is conceivable that there are ways of organising production that provide for freedom but that we cannot yet imagine, due to our current level of development and consciousness. Ultimately, whether or not we can at present design a system that provides for freedom, it is important to understand and appreciate the limitations of market socialism from the perspective of freedom. In this respect, I would like to echo Cohen’s “sour grape” argument:
“If you cannot bear to remember the goodness of the goal that you sought and which is not now attainable, you may fail to pursue it should it come within reach, and you will not try to bring it within reach.” (Cohen, 1991, p.14)
Before we move to the next section, I will briefly outline the structure of the paper. As aforementioned, there are various different concepts of freedom. A clear understanding of what is meant by freedom is necessary for a coherent analysis of market socialism’s impact on freedom. Section one will, therefore, be dedicated to the conceptualisation of freedom. In this section I will explore the various concepts of freedom including Sen’s Capability Approach. In this section I will also discuss my selection of capabilities and the potential for bias in this procedure. Hence, section one will serve the purpose of outlining the framework of evaluation for my paper. This section will be followed by section two which will explore market socialism. The aim of this section is to give the reader a clear and concise understanding of what a market socialist economic system would entail. Once I have explored the key concepts in sections one and two, I will move on to the analysis. I will begin by analysing the impact of the labour market on freedom in section three. This section will draw heavily on a Marxist analysis of the dual character of labour and his concept of alienation. I will finish this section by countering Schweickart’s argument that market socialism will not have a labour market and thus demonstrate that the way in which the labour market impacts upon freedom is indeed a problem for market socialism. I will then proceed to section four, where my attention will turn to what I have termed “market psychology”; the feelings and behaviour fostered by the market. I will analyse the feelings and behaviours resulting from a society based on market exchange and the impact of these on freedom. In the same way I did for section three, I will conclude the section by demonstrating that this problem will persist in a market socialist system. I will then finish the paper with a conclusion. I will conclude that market socialism is not a desirable economic system from the perspective of freedom because of its impact on significant capabilities, conversion factors and development (and consequently our range of capabilities). I will also note the significance of my research and what this does and does not mean for future research.
1. Freedom
Ideas of freedom have varied throughout history, and even at a specific moment in time, what people mean by freedom is highly variable. For this reason, this section is dedicated to the conceptualisation of freedom. As mentioned in the introduction of this paper, the main aim of this research paper is to evaluate market socialism in terms of its consequences for freedom. It follows that this section will not analyse the notion of freedom nor will it contribute to the debate on the nature of freedom. Instead, this section will lay the foundation for the analysis to follow. I will begin by outlining the positive, negative and republican concepts of freedom. This will be followed by a presentation of MacCallum’s argument that conventional distinctions between concepts of freedom are arbitrary and unhelpful, and freedom can be conceptualised by an all-encompassing triadic relation. I will then turn to a final concept of freedom: Sen’s Capability Approach. I will explore this notion of freedom in greater detail because it is this concept which forms the framework of my paper.
1.1 Overview of Concepts
Two key perspectives from which one may view freedom, are positive freedom and negative freedom. These were famously distinguished from each other by Isaiah Berlin (Berlin, 1958), and this distinction has since become the dominant way of discussing freedom in political theory. Put in extremely simple terms, negative freedom is “freedom from” and positive freedom is “freedom to” (ibid.).
Negative freedom is most commonly associated with liberalism and this conception of freedom stipulates that freedom is the absence of external interference (ibid.). Thus, as put by Berlin, “[I am] free to the degree to which no man or body of men interferes with my activity.” (Berlin, 2002, p.169). This understanding of freedom does not cover all incapacity. If an individual is unable to act in a certain way for reasons other than the actions of another human, their freedom is not impaired. For example, an individual who is blind and so cannot read is not lacking the freedom to read. This was expressed by Rousseau who stated that the nature of things cannot madden us (Berlin, 1969). Significantly, this conception of freedom does not require the external interference to be deliberate or intentional, only that it is a human action or arrangement (i.e. not the result of natural phenomena) (White, 1970). It is important to note that even within the tradition of negative liberty, there are various strands
with differing details. For example, one point of contention within the negative liberty school is the relevance of an individual’s desires to the question of freedom (Arneson, 1985). Hobbes, for example, holds that negative liberty means non-interference with a person’s will; he states that “a freeman… is not hindered to do what he has a will to” (Hobbes, 1996, p.139). This is in contrast to Berlin who considers desires irrelevant and states that “freedom ultimately depends not on whether I wish to walk at all… but on how many doors are open” (Berlin 2002, p.32).
The second prominent concept of liberty is positive liberty. Positive liberty has various versions (Geuss, 2005), however, they all stem from the belief that absence of interference is not enough to secure liberty. Hence, positive liberty conceives freedom as freedom to actually do something (the something depending on the version of positive liberty). Some theorists conceptualise positive freedom as autonomy, i.e. an individual being the absolute principle of one’s own behaviour, others understand positive freedom to mean self-realisation (ibid.) and others still conceptualise freedom as the expression of an individual’s “true self”, i.e. one’s ability to realise authentic desires (ibid.) Even within these schools of freedom there are varieties, for example, how one distinguishes authentic desires (ibid.). In general, the obstacles deemed to impede freedom are more far-reaching in the positive liberty tradition than in the negative liberty one, hence it does not matter whether the obstacle is impersonal, intentional or internal (Swan, 2003).Thus, in contrast to negative liberty, internal restrictions such as fears or conventional norms, may be considered to limit one’s freedom.
A third conception of freedom is republican freedom. This school of freedom is predominately associated with Philip Pettit (Pettit, 1997) and has its intellectual roots in the republican tradition of Ancient Rome, the Italian Renaissance and the period leading up to the American Revolution (Swan, 2003). Republican freedom holds that freedom is the absence of domination and being dominated is understood as being subject to the arbitrary will of another. A will is arbitrary when someone has the capacity to exercise it, or not according to the person’s whim or pleasure (ibid.). Another fundamental element of arbitrary will is disregard for the subject’s interests. Thus, Petit states:
“When we say that an act of interference is perpetrated on an arbitrary basis [...] we imply that like any arbitrary act it is chosen or not chosen at the agent’s pleasure. And in particular, since interference with others is involved, we imply
that it is chosen or rejected without reference to the interests, or the opinions, of those affected.” (Pettit, 1997, p.55)
What’s more, no actual interference (including a threat) is necessary for domination to exist. According to Petit (1997), dominators may rarely if ever exercise that power. This is because someone can shape the latter’s conduct even if he never interferes (Swan, 2003). Given the inclusion of the arbitrary condition, not all interferences compromise freedom. For example, authorities may enact measures which interfere with citizens’ lives, but as long as such measures are made according to non-arbitrary laws such interference does not constitute a freedom-compromising factor. Petit discussed various ways that a law can be non-arbitrary. This includes constitutionalism, contestatory democracy, the rule of law, the dispersion of power, etc. (Wendt, 2011, p.183). Domination results in the will, judgment or interests of one agent being unilaterally replaced with the will, judgment or interests of another and is thus clearly an issue for one’s freedom (ibid.).
In Two Concepts of Liberty (Berlin, 1958), Berlin frames negative and positive freedom as being in direct contrast to each other. Following this lead, many theorists have held that they are competing, mutually exclusive conceptions of freedom. However, some theorists have argued that the line between the two is blurred and unmeaningful. Most notable among these theorists is Gerald MacCallum, who, in Negative and Positive Freedom (1967), argued that the distinction between positive and negative freedom is based on serious misunderstandings. MacCallum proposes that there is only one kind of freedom which all other concepts of freedom, including republican freedom, fit into. MacCallum regards freedom as “always one and the same triadic relation” (Maccallum, 1967, p.312) represented by the following schema:
“x is (is not) free from y to do (not do, become, not become) z.”(Maccallum, 1967, p.314)
For MacCallum, this analysis is all-encompassing and all judgments about freedom can be cast in the form of this schema. He holds that disputes about freedom are, in fact, disputes about the range of variables x, y or z – that is, about the agents whose freedom is in question, about what counts as an interference with or obstacle to the agent’s freedom, or about the range of what such agents might or might not be free to do or become (Swanton, 1979).For
example, the differing stances on internal obstacles to freedom (with the positive school holding that they do constitute freedom restricting factors, and the negative school holding that they do not) can be characterised as disagreements over the range of variable y of the schema. MacCallum (1967) also notes that although what is considered to be the range of one variable may influence what is considered to be the range of another variable, there is not a deterministic relationship between how the variables are characterised. This is the main reason why he argues that separating accounts of freedom into two camps is highly distorting. 1.2 Sen’s Capability Approach
I shall now outline another alternative conception of freedom: Sen’s Capability Approach. Due to the fact that this approach forms the basis for this paper, I shall go into more depth outlining this approach than I have for the others above. I shall outline the fundamental aspects of the approach, discuss some common criticisms and motivate my choice to use the approach.
Although some scholars regard the Capability Approach as a version of positive freedom (Ochangco, 2016), the general consensus is that it is a distinct concept of freedom (Wodak and Forchtner, 2017). The Capability Approach was pioneered by economist and philosopher Amartya Sen in the 1980s. Since then, various scholars have developed the approach in differing directions, so much so that some philosophers have started to use the term “capabilitarianism” (Robeyns, 2016). Most notable of such theorists is philosopher Martha Nussbaum, who has taken the Capability Approach to create a partial theory of justice (Nussbaum, 2011). For the purpose of this paper I will look at Sen’s classical Capability Approach.
Sen believes that freedom should be conceptualised as the potential to do and be things that a person has reason to value (Sen, 2000). At the core of the Capability Approach is the notion of functions and, more centrally, capabilities (capability set). Functions are states of “beings and doings” (Sen, 1993, p.31) and are what we are usually concerned with when we refer to an individual’s well-being. For example, being educated, having a supportive social network or going on holidays. Capabilities refer to the alternative functionings that are feasible for an individual to achieve (Sen, 2000), i.e. they are a person’s real opportunities or freedoms. Thus, a functioning is an active realisation of one or more capabilities (ibid.). Although in
some contexts attention is paid to functionings, the Capability Approach holds that it is a person’s capabilities, not their chosen functionings, that are most important for freedom. The
reason for this can be illustrated by taking the case of a starving homeless man and a person
who is fasting for religious reasons (Sen, 1985). Both have the same functioning (they are malnourished) but they have very different capabilities (one could have chosen not to be malnourished, whereas the other could not have) and this difference is significant for how free we would deem each person; namely one has the freedom to be well-nourished and one does not. It is for this reason that Sen uses the terms capabilities and freedoms interchangeably. It follows that capabilities, being freedoms, have value in and of themselves. It is important to note that capabilities are freedoms created by both personal (innate and developed) abilities and the political, social and economic environment (Nussbaum, 2011). In this way, one’s personal abilities and one’s environment can be considered conversion
factors; they convert materials into capabilities. It follows that having access to the same
material resources does not mean having the same capabilities, because conversion capacity varies between individuals.
The Capability Approach’s main focus is on capabilities (freedoms) which people may or may not exercise (Sen, 2000). It follows that the Capability Approach attaches great importance to the freedom to choose which capabilities to realise and is committed to respect for one’s power of self-determination (Nussbaum, 2011). What is important is that an individual is free firstly to decide upon, and secondly to pursue the kind of “lives that [they] have reason to value” (Sen, 2000, p.53). Embedded in the Capability Approach is thus the notion that agency is of intrinsic importance (Sen, 2000), especially in the sphere of a person’s own life. Sen argues that:
“the conception of “persons” in moral analysis cannot be so reduced as to attach no intrinsic importance to this agency role, seeing them ultimately only in terms of their well-being.” (Sen, 1985, p.186)
In further motivating the emphasis placed on choice, Sen points out that not only is choice intrinsically valuable, but that exercising choice actually changes the nature of the functioning achieved. Going back to the example used above, the functioning of the man who is fasting for religious reasons is “malnourished by choice,” a potentially enjoyable and eye-opening experience. In contrast, the functioning of the homeless man is simply
“malnourished.” Hence, the Capability Approach is concerned with the freedom to form objectives and have the capabilities to realise them (Sen, 1987).
In the context of a framework which treats freedom as plural – as capabilities – the question arises: which capabilities are the most significant? Sen has refused to endorse one predetermined canonical list of central capabilities (Sen, 2004) because he argues that “public reasoning and discussion are necessary for selecting relevant capabilities and weighing them against each other in each context” (Sen, 2004, p.77). This contrasts with Nussbaum who argues that certain political principles should underlie all constitutions, and accordingly, has set out ten universal central capabilities (Nussbaum, 2011). However, Sen’s reservations about a list of capabilities have not precluded him from discussing certain capabilities that he regards as needing attention in a specific situation (for example, Sen 1979). In this research paper I predominantly address market socialism’s impact on capabilities in general, that is, the range of capabilities available to individuals and their ability to fully experience chosen capabilities. I also discuss one’s ability to reflect and decide upon the things that they value, which as we have seen is a central component of the Capability Approach. I will also at times make reference to specific capabilities. To some degree my research, therefore, involves a normative judgement and is therefore potentially vulnerable to biases. However, the capabilities I focus on stem from the fundamental nature of human beings, for example, human beings are naturally social animals, and one capability I look at is having healthy social relationships. This is in contrast to a capability such as the capability to combine a family life with a job and career, which clearly does not stem directly from the nature of humans and appears informed by normative beliefs. Williams (Sen, 1987) has argued that when capabilities come from nature, as opposed to convention, they are less,1 if at all,
vulnerable to biases. Furthermore, where I do discuss specific capabilities I justify the importance of the capability in question with scientific studies.
Due to its focus on individual agency and self-determination, the Capability Approach is often criticised for being too individualistic in its approach to freedom (Deneulin and Stewart, 2002). Commentators argue that rather than being regarded as atomised beings, individuals should be recognised as socially embedded. However, in response to this criticism, Dr Ingrid Robeyns (2017) pointed out that although the Capability Approach has a
1 Of course, some assumptions regarding human nature are also contestable, however, I have chosen those that
commitment to normative individualism, it does not subscribe to methodological and ontological individualism. Normative individualism postulates that individuals are the units of ultimate moral concern, however, it does not, like methodological individualism, hold that all social phenomena is to be explained exclusively in terms of individuals, nor does it, like ontological individualism, hold that society is nothing more than the sum of individuals (ibid.). Hence, the Capability Approach’s attention to individuals’ goals does not preclude it from accounting for the constraints and opportunities of social structures, because normative individualism is entirely compatible with an ontology that recognises the connections between people and people’s social embedment (ibid.).
Similarly, the Capability Approach’s notion of “respecting each as an end, rather than simply as the agent or supporter of the ends of others”(Nussbaum, 2011, p.55), does not mean that the approach affords the community no significance. The approach highlights that communities cannot themselves have capabilities, as each individual within the community will have different capabilities (ibid.). However, the community can and does have an effect on individuals’ capabilities and thus in this sense the health of the community and of community development can be of importance.
Another criticism of the Capability Approach is that it lacks radical potential. The Capability Approach has been somewhat influenced by Karl Marx and both Sen and Marx are/were concerned with the very essence of human lifeand human flourishing. What’s more, scholars have pointed out parallels between the Capability Approach and Marx’s, somewhat ill-defined, concept of freedom (Ochangco, 2016). For example, both value a situation whereby individuals play a conscious and active role in his/her life activities (ibid.). However, despite this connection, in general the Capability Approach to freedom lacks radicalism. Sen has a very uncritical view of the state (Ochangco, 2016), views the market as undeniably positive for freedom (Sen, 2000) and seems to regard many of today’s institutions as natural (ibid). Bagchi (2000) has pointed out that Sen has largely been interested in the exchange entitlements of individuals, neglecting relationships of production and domination in society. Likewise, Koggel (2003) criticises the Capability Approach for not paying due attention to social constraints, and more specifically “global forces of power and systems of local oppression.” (Koggel, 2003, p.175).
Given this, it may seem counter-intuitive to use Sen’s Capability Approach as a framework for analysing a socialist economy, especially given the conclusion that it is being used to reach. However, that Sen has not used his approach to critically analyse institutions that he deems natural, such as the market, does not mean that it is not an appropriate tool to do so. Indeed, Sen himself holds that a key purpose of the Capability Approach is to “evaluate formal and informal institutions in the light of their contributions to our freedom” (Sen, 2000, p.142).
I have chosen to use the Capability Approach over other conceptions of freedom because I believe that the question ‘what are people really able to do and what kind of person are they
able to be?’ accurately reflects the essence of freedom, and thus Sen’s Capability Approach
is the most suitable for evaluating freedom in a given context. The Capability Approach focuses on genuine opportunities, treats each individual as an end in themselves and places sufficient emphasis on agency and choice, and in doing so takes sufficient account of the pluralism of individual values. Furthermore, the theoretical distinction between capabilities and functionings, and more specifically the role of conversion factors, in the Approach provides the scope for analysing the impact of social systems on freedom. The Capability Approach is most prominently used in the fields of development studies and welfare economics and has been underutilised in political science. I hope that this paper can highlight its usefulness in assessing the degree of freedom that a given system provides. I also believe that the use of the Capability Approach in this paper may reassure commentators such as those mentioned above that the Capability Approach is capable of criticising social power and hegemonic institutions and has more radical potential than recognised
2. Market Socialism
As mentioned in the introduction, market socialism is far from a new concept and can be traced back to the 1830s (McNally, 1993). However, as time has progressed, more thorough efforts have been made to detail what a market socialist system would look like. This chapter of the paper will be dedicated to outlining market socialism. This will provide the necessary clarity and basis for the analysis in the subsequent chapters. There are two aspects fundamental to market socialism: the market aspect and the socialist aspect. I will treat each one briefly in turn. This will be followed by an outline of David Schweickart’s model of market socialism, Economic Democracy, and the arguments underlining his model.2 As mentioned in the introduction, I am using Schweickart’s model of market socialism because it is the most detailed and most promising in regard to freedom, hence my argument against market socialism will carry more weight. Finally, towards the end of the chapter I will provide a cautionary note on using examples to substantiate arguments about market socialism.
2.1 Overview
Market socialists that believe market socialism to be a desirable end goal (rather than a transitionary stage)3 believe that the market offers us various benefits. The most cited, however, is economic allocative efficiency (Arnold, 1994). Many socialists hold that central planning is prohibitively inefficient4 and this leads some to endorse the market as an efficient mechanism to price goods and thus allocate resources. Market socialists defend this emphasis on efficiency by arguing that efficiency is necessary “for satisfactorily meeting people's basic material needs, which, in turn, is a necessary condition for a society to be a good society” (Arnold, 1994, p.43). But what exactly is a market?
The classical economist would simply define a market as any arrangement that enables buyers and sellers to get information and to do business with each other (Parkin, Powell and Matthews, 2014). From this perspective, a market facilitates equal exchange between two parties. Such economists also postulate that when left alone, the market directs commodities
2 Readers are directed to After Capitalism (Schweickart, 2011) for a more thorough account of his model and
motivations.
3 It is these market socialists that I will be referring to in the rest of the paper when I speak of market socialists. 4 For a systematic structural critique of socially planned economies see Nove (1983).
and factors of production to their most efficient use. However, a market is actually much more than a space for exchange. As Marx explained in Capital, A Critique of Political
Economy, Volume 1 (1867), the market is where the law of value operates (Marx, 1995
[1867]). In other words, the market is the sphere in which a product’s value is realised (ibid.). It follows that a market cannot simply be equated with an act of exchange because a market is only present where value, and more specifically exchange value, is invoked. This means that barter, for example, does not constitute a market. Private property5 is a precondition for a
market. In order to sell something, we must own it and thus be able to transfer it. Likewise, a market presupposes unsocialised individual production because if production was socialised from the outset there would be no need to exchange products on a market. Competition between private producers and between buyers is also an inherent component of a market because the value (price) is determined by competition and the resulting fluctuations in supply and demand (ibid.) A more comprehensive account of how the market facilitates the realisation of value, and the role of currency in expressing this value, will be given in section 3.1.
Finally, the market is often conceptualised as multidimensional; a market in goods and services, capital and labour. Schweickart (2002) holds that a market socialist system would have a market for goods, services and capital to some extent but not for labour. As we shall see, however, this distinction is not as clear as it might first seem, and thus attempts to separate them are unfeasible.
A key term in the context of the market is commodity. A commodity is often defined as a “useful or valuable thing” (Oxford dictionary). However, this is not an accurate understanding of a commodity. Marx noted that to become a commodity a product must be transferred to another by means of exchange (Marx, 1995 [1867]). Thus, an item is a commodity “only in so far as they have two forms, a physical or natural form, and a value form” (Marx, 1995 [1867] p.54). Marx further specified a commodity as “products of the labour of private individuals or groups of individuals who carry on their work independently of each other.” (Marx, 1995 [1867], p.44). Hence, a product is a commodity when it has been produced for exchange with another commodity. It follows that given that commodity
5 Private property encompasses both individual and cooperative ownership. The only alternative to private
property is social property whereby something belongs to the whole community and thus cannot be bought or sold.
production by definition means that the product will be exchanged on the market, commodity production and market exchange are two sides of the same coin.
Market socialists attribute the existing social vices of the market, to the form that ownership rights of the means of production,6 take in our current system (Arnold, 1994). It is for this reason that they seek to socialise the means of production. It is sometimes argued that there are two options for social ownership of the means of production (Arnold, 1994): either the state owns them or the people do. This stems from the idea that the state is the genuine representative of the people. Hence, we get politicians referring to state nationalisation as giving the asset in question ‘back to the people.’ However, I (along with many others)7 hold that state-ownership of the means of production does not constitute socialisation of them. This is because the state, and thus the nationalised assets and firms they control, always develop their own interests – interests which do not coincide with the interests of the people. Thus, having the means of production in the state’s hands cannot be considered socialism (Cliff, 1917).
This means that the socialisation of the means of production must take the shape of individuals themselves owning the facilities and resources. This can take various forms. One is Property Owning Democracy, whereby ownership shares of the nation’s corporations are more or less equally distributed, and institutional mechanisms are in place to preserve this equal distribution (O’Neill and Williamson, 2012). Such a model has been most thoroughly elaborated on by John Roemer, although it is worth noting that Roemer himself believes that the link between public ownership and socialism is tenuous, and accordingly does not consider this a method of giving the means of production to the people (Roemer, 1994). Alternatively, socialising the means of production could be achieved by the establishment of worker cooperatives whereby workers own and self-manage the enterprise they work in. Yet another way is to make all resources (capital assets) the property of the community as a whole. This is the method that Schweickart has embraced in his model Economic Democracy and will be explored below. In contrast to Property Owning Democracy, worker self-managed cooperatives introduce democracy to the workplace. Due to this additional layer of empowerment, this is the form of market socialism that is most popular among market socialists (Arnold, 1994).
6 Means of production refers to the facilities and resources necessary for producing goods. 7 Trotskyists and other scholars such as Richard Wolff and Noam Chomsky.
2.2 Economic Democracy
I will now explore David Schweickart’s model of market socialism, Economy Democracy (Schweickart, 2002), which is the point of departure for this paper. There are three fundamental aspects of Economy Democracy: worker self-management, the market and social control of investment. It is very important to note that Economic Democracy is being described here as envisioned by Schweickart. Thus, I am relaying the model from his perspective and hence the explanations and justifications are from his perspective and not mine. It follows that in section three, I will argue against some of the assumptions made in this section, for example, the non-existence of a labour market and the empowerment of workers to shape the labour process.
Worker Self-Management
Workers8 are responsible for the operation of the enterprise in which they work, thus they are empowered to make the decisions that impact them. Workers decide what to produce, how much to charge, and how to distribute the proceeds. Enterprises are not required to pay workers equally. Schweickart holds that most firms will award larger shares of the proceeds to skilled workers. What is important is that these decisions will be made democratically by all and only those inside the enterprise. Any managerial roles will have to be democratically accountable and recallable. For large enterprises this will take place via an “upper management”, elected by worker councils.
In Economic Democracy, although the workers own the output of the enterprises, they do not own its capital inputs; the means of production. Workers have the right to use society’s capital assets, however they remain the collective property of society at large. In Schweickart’s words, societal ownership of the enterprise manifests itself in two ways:
§ All firms must pay a tax on their capital assets, which goes into society’s investment fund.
§ Depreciation funds must be maintained.
8 Note that Schweickart refers to them as workers rather than employees as he does not consider them to be
Schweickart does not explicitly motivate the decision to make capital assets the property of the community rather than the workers, however, what this achieves is the protection of the community’s present and future capital assets. Workers cannot let the assets deteriorate nor can they sell them to make a profit.
The Market
Economic Democracy utilises the market to allocate consumer and capital goods. In Schweickart’s words, “Firms buy raw materials and machinery from other firms and sell their products to other enterprises or consumers. Prices are largely unregulated except by supply and demand” (Schweickart, 2002, p.49). In the context of the market, enterprises strive to make a profit. However, labour is not a cost of production, rather workers are the residual claimants (a concept which will be explored in section three). Thus, the market does not create the drive to exploit workers as it does in capitalism. There is no labour market in market socialism because workers are not selling their labour to a capitalist, rather they are using it for their own endeavour.
Social Control of Investment
As aforementioned, enterprises must pay a tax on their capital assets into society’s investment fund. All new investment will be funded on this basis and so in contrast to capitalism, private savings will not fund investment. Therefore, investment will not simply flow to where it is most profitable as it does in capitalism. Schweickart outlines two options for deciding on where to direct funds. Firstly, there could be a democratically elected planning board which creates an allocation plan. This would not be a planned economy since it is only investment funds, rather than all inputs and outputs, being planned. Secondly, the investment fund could be distributed to local banks that would operate much the same as capitalist ones do – they are expected to make a profit and bankers are paid according to “performance.” For a wealthy country, Schweickart advocates a position in between these two extremes. Investment funds would be dispersed to regions and communities on a per capita basis, then to public banks in accordance with past performance and then to firms with profitable project proposals. The idea is that communities are guaranteed a steady supply of
investment, eliminating the pressure to compete for investment in race to the bottom style.9
However, after this fair share requirement, the market is used to promote efficiency in investment decisions.
Above I have sketched out the details of Schweickart’s model of market socialism: Economic Democracy. Naturally, there are more details which can be found in his book After
Capitalism (2002), however, we now have the necessary basis for demonstrating market
socialism’s impact on freedom. 2.3 A Note on Comparisons
Worker cooperatives can be found throughout the world and are thus not a new phenomenon. However, market socialism, and particularly Economic Democracy, does not exist and has not existed anywhere in the world. It is important to make this point because comparisons are often misleadingly brought into the market socialist debate. The two societies most prominently referred to in the literature are the old Yugoslavia and the Mondragon Cooperative in the Basque region of Spain.10 However, these cooperatives are unsuitable examples of worker self-managed market socialism and we should be cautious about drawing generalised conclusions from these experiences.
Firstly: Yugoslavia. Although Yugoslavia was constituted of worker-run cooperatives, workers did not have unrestricted rights of self-management because they had to share decision-making authority with political officials. Similarly, political officials often had substantial influence in the election of management. Furthermore, unlike in the market socialist model in which the market allocates goods, there was widespread interference with the market pricing system in Yugoslavia (Estrin, 1991). Finally, market socialism is embedded in a democratic context, whereas Yugoslavia’s political framework was dominated by the Communist Party (ibid.).
Secondly: the Mondragon experience. Unlike in Economic Democracy, workers in the Mondragon Cooperative own the firm’s capital. Secondly, the cooperatives external
9 ‘Race to the bottom’ refers to the deregulation/lowering of standards (e.g. labour and environmental standards)
to increase profitability and thus attract economic activity and investment.
10 Although China is also deemed by some to be market socialist, it is not an example of worker self-managed
environment consists of conventional capitalist firms and this plausibly impacts the functioning of the Mondragon cooperatives. Finally, Bradley and Gelb (1981) have pointed out that there is limited labour mobility in the Basque region and therefore the cooperatives are partially insulated from the pressures of the labour market.
It follows from the above, that the experiences of Yugoslavia and Mondragon are of limited usefulness when it comes to assessing market socialism from the perspective of freedom.
3. The Labour Market
In this chapter I will analyse the labour market’s impact on freedom. I will begin by defining the labour market and outlining its constitutive features. I will then explore the ways in which the labour market negatively impacts our freedom, with freedom being conceptualised in terms of the Capability Approach. In sum, the existence of a market for labour alienates individuals and this alienation limits human creativity, which is both a significant capability in itself and a precondition for development and thus the expansion of capabilities in general. Furthermore, the labour market means that we live in a context of abstract time, and this has various negative implications for capabilities. In the final part of the section I will turn to Schweickart’s argument that there is no labour market in market socialism. I will refute this claim, and in doing so demonstrate that market socialism cannot afford us freedom because it embodies a labour market. Given that the notion of alienation was pursued most thoroughly by Karl Marx, and he has criticised the labour market rigorously throughout his lifetime, this chapter will make extensive use of Marxist theorising.
3.1 What is the Labour Market?
I shall begin by exploring the concept of a labour market. This is an important first step because it is necessary to have an understanding of how a market for labour works, in order to understand how it impacts upon our capabilities. It is also important to have an accurate understanding of the labour market in order to dispute Schweickart’s claim that market socialism does not have one. What is meant by a market was explored in section 2.1, where market socialism was defined, and the definition of the labour market builds upon this basis. Labour, like land and capital, is a factor of production. That is, it is a resource that goes into making goods and services. Hence, the labour market is a branch of the general commodity market (Marx, 1995 [1867], p.109). It follows from the above that a labour market is an institution facilitating the realisation of the value of labour. Individuals exchange their labour (or as Marx terms it, labour power; Marx, 1995 [1867], p.109) for another commodity (money), and in doing so, their labour is given a social value. Thus, the market allows labour to be exchanged based on its exchange value. Individuals only sell their labour for a definite period of time, for if they would sell it for an indefinite period, they would, of course, go from an owner of a commodity (labour) to a slave (Marx, 1995 [1867], p.109).
To understand how labour is assigned a value by the market we must look at the concept of abstract labour because without abstract labour, labour could not be exchanged on the market and thus there could be no labour market. Although we can see the idea of abstract labour slowly developing in his prior works (Marx, 1847, pp.45-55), Marx spelt out the concept of abstract labour most clearly in his Capital, A Critique of Political Economy, Volume 1 (1867). To understand abstract labour, it must be juxtaposed to what Marx termed concrete labour.11 Concrete labour refers to the unique production process undertaken by an individual (McNally, 1993). Thus, concrete labour is inseparable from its specific qualities. Concrete labour’s specific quality is “determined by its aim, mode of operation, subject, means and result” (Marx, 1995 [1867], p.18). It follows that each act of concrete labour is qualitatively different from another and refers to the actual act of production. Concrete labour produces articles with use-value, that is, a value attributable to its usefulness (Holloway, 2010). Hence, Marx described concrete labour as “human action with a view to the production of use-values, appropriation of natural substances to human requirements.” (Marx, 1995 [1867], p.119).
However, in the context of the labour market, i.e. when we aim to exchange our labour for another commodity, all kinds of private concrete labour must take a form which allows for mutual exchangeability. In other words, to exchange labour, it must take on a form common to all types of concrete labour (Marx, 1995 [1867], p.44). This form is abstract labour. Abstract labour provides “the equalisation of the most different kinds of labour” (ibid.) and thus has a universal character.
This process, the process of labour taking on an abstract form, is fundamental to market exchange in general. Hence, Marx wrote: “whenever, by exchange, we equate as values our different products, by that very act, we also equate, as human labour, the different kinds of labour expended on them” (Marx, 1995 [1867], p.44). Ultimately, neither labour, nor the products it creates, would be exchangeable if they did not embody a unit of common substance. In order to be common to all commodities, it is clear that abstract labour must be abstract in comparison to the specific qualities of the concrete labour. Thus, Marx wrote, and it is worth quoting at length, that the commodity can:
11 Other authors, such as Holloway (2010), prefer to avoid the term labour altogether, instead referring to
“no longer be regarded as the product of the labour of the joiner, the mason, the spinner, or of any other definite kind of productive labour. Along with the useful qualities of the products themselves, we put out of sight both the useful character of the various kinds of labour embodied in them and the concrete forms of that labour; there is nothing left but what is common to them all; all are reduced to one and the same sort of labour, human labour in the abstract.” (Marx, 1995 [1867], p.15)
In other words, commodity production creates a distinction between qualitatively distinct concrete-labour and homogenous abstract labour. Ultimately, commodity production and market exchange means that the relationship between two commodities has a quantitative nature only. Incidentally, but not vital for the argument being developed, this unit is materialised in the form of money (Marx, 1995 [1867]). Thus money becomes “the universal incarnation of abstract human labour.” (Marx, 1995 [1867], pp.46-47) To quantify all kinds of labour may seem problematic, and it is. Nevertheless, commodity production demands that it is done, as abstract labour is the only basis on which market exchange can take place. It will now have become clear that the transformation of concrete labour into abstract labour is synonymous to the commodification of labour power; abstract labour is what allows us to exchange labour power on the market. Thus, abstract labour facilitates the commodification labour power and is a fundamental aspect of the labour market.
It is important to note that abstract labour is not the same as socially equated labour. In any system based on the social division of labour, something which almost all economists, including Marxian economists, agree is necessary, there must be a method of equating different types of concrete labour (Rubin, 1978). Otherwise, concrete labour could never be social and we would all have to be entirely self-sufficient. However, abstract labour is just one way of doing this, the way inherent to market exchange. Exploring the various other ways that concrete labour could become social is not the purpose of this paper, but for the sake of distinguishing socially equated labour from abstract labour one could imagine a determined social organ which socially equates the labour of different individuals for the purpose of economic planning (ibid.). In such a case, production would be organised and
labour would be social at the outset, in its concrete form. Abstract labour is unique to a system of individual private commodity producers (commodity production).
Now that we have a clear understanding of what a labour market is, and its fundamental component, abstract labour, we can begin the task of analysing the impact of the labour market on freedom. The labour market, and more specifically, abstract labour, has a detrimental impact on our capabilities. The following section will be divided into two. First, I will look at the notion of alienation and how this phenomenon impacts upon freedom. I will then focus my attention on the notion of abstract time and its implications for freedom. 3.2 Alienation
One mechanism through which the labour market impacts upon our freedom is through alienation. Ultimate abstract labour, in reducing a multiplicity of concrete acts of labour to a common abstract value, separates man from his productive activity, from his product and from his “species being” (Marx, 1939). This separation has significant consequences for freedom. In sum, alienation within these three relations limits our potential to use our creativity. Creativity is an important capability in itself, but it also facilitates development. Limiting our development effectively limits the range of capabilities available to us. I will begin this section by sketching the multi-faceted notion of alienation. I will then proceed to analyse the impact of this separation on our creativity and thus our freedom.
The notion of alienation has its roots in the political and philosophical debate of the Enlightenment (Swain, 2012) and has been explored by philosophers and sociologists alike. The notion stems from when the term “alienate” meant to give away or to sell (ibid.). Marx developed this idea12 and his notion of alienation can broadly be understood as the separation or estrangement of man from a feature of his context, with the result that our very own human activity is experienced as external/alien to us. Alienation can only really be grasped as the absence of unalienation (Ollman, 1976), because for separation to be deemed undesirable, the natural state must be unity. Marx’s conception of human nature, which holds that man and his relationship to nature is part of an organic totality (ibid.), provides the basis
for this evaluation.13 Marx regards the alienated state as “a mistake, a defect, which ought not to be” (Marx, 1939, p.75) and thus goes on to argue that it is not the unity of man with nature which needs explaining but rather that “what we must explain is the separation” (Marx’s emphasis) (Marx, 1857, pp. 86-87, as cited in Ollman, 1976, p.133). It follows that alienation is deemed damaging for an individual.
In Economic and Philosophic Manuscripts (1844), Marx’s only organised exploration of alienation, Marx analyses four social relations which currently suffer from alienation, and although he covers each one separately, they are part of an interwoven whole (Alienation, 302) and thus intrinsically tied together. These four social relations are man’s relation to his productive activity, to his product, to other men and to the species. In this section I shall only be concerned with three of these social relations. I will not treat man’s relation to other men because this form of alienation will be analysed in section 4.1 in the context of market psychology.
Before I proceed it is worth clarifying that although alienation is most often discussed in the context of capitalism, much of the separation in social relations can, in fact, be traced to the notion of abstract labour and thus the labour market. Indeed, Marx recognises this, noting on the 24th August 1867 in a letter to Engels that:
“The best points in my book are: 1. (this is fundamental to all understanding of the facts) the two-fold character of labour, according to whether it is expressed as use value or exchange value, which is brought about in the very first chapter.” (Lawrence and Wishart, 2010, p.407)
Many authors discussing Marx’s concept of alienation lose sight of the notion of abstract labour. So much so that John Holloway goes as far as saying that this point “has remained almost unmentioned in the Marxist tradition” (Holloway, 2010, p.87). This is a very unfortunate oversight, because it prevents those authors from grasping the fact that alienation has its roots in market exchange. However, this is a vital step in my argument because I am discussing the impact of the labour market (not capitalism) on freedom. It is therefore my aim
for the link between abstract labour and each form of alienation to become clear in the discussion of each form of alienation to follow.
Firstly, let’s look at the relation of man to his productive activity. Man’s productive activity is key to realising himself in the world (Swain, 2012) and being able to consciously shape our environment is what distinguishes us from other species (Marx, 1939). It follows that how we relate to our productive activity is significant. At present, there is a break in the connection between man and his productive activity. For Marx, this break in connection is attributable to lack of control over our concrete labour (Swain, 2012). In the context of capitalism, much of the workers’ control over the labour process is lost to the capitalist, who owns the labour power of the worker during working hours and can thus dictate the processes at work. However, abstract labour itself is also a source of this loss of control. As Dain Swain has put it:
“Those who sell their labour power, literally alienating it away, lose all control over it. The labour process becomes something under control of someone else and
ultimately outside of any control whatsoever” (Swain, 2012, p.36; my emphasis)
It follows that while alienation of man’s productive activity can be, in part, attributed to capitalism (the presence of a capitalist class owning and controlling labour power), another part of it would still remain because it is attributable to the very act of selling one’s labour on a market. The consequence of a labour market is that “the particular, human quality of the labour of some particular individual becomes subordinated to abstract labour” (Swain, 2012, p.37). How exactly does abstract labour control the labour process? In the context of market exchange, commodities sell on the basis of socially average labour times. That is the socially average amount of abstract labour units needed to produce the item in question14. Ultimately, in a bid to produce below the socially average labour time (which they must in order to sell their product), an individual is forced to change the nature of their concrete labour. Thus, Holloway writes that commodity production “imposes an abstraction which rebounds upon
14 Marx’s definition of socially average labour time is as follows: “the labour time socially necessary is that
required to produce an article under the normal conditions of production, and with the average degree of skill and intensity prevalent at the time” (Marx, 1995[1867], p.16).
the way in which the concrete labour is performed” (Holloway, 2010, p.92). Thus, the system of commodity exchange means that the labour process – what to make, how to make it – is beyond the control of any one individual.
The second relation suffering from alienation is man’s relation to the product of his labour. When an individual sells his labour, he loses the natural connection to the product of his labour. The way in which the labour market causes this alienation is twofold. Firstly, due to the fact that in the context of the labour market, labour only takes on a social character in its abstract form, the individual does not recognise the product of his labour as a product of his own creative capacities (Ollman, 1976). Ultimately, the labour market means we can no longer speak of a unity between our labour and its purpose, and this is experienced as alienation. When all that matters is abstract, homogenous labour, we no longer identify with the product of our labour. Secondly, in the context of a labour market, an individual has no control over what becomes of the product of his labour, in fact, he does not even know what happens to it after the moment of sale (ibid.). Thus, the individual is well and truly alienated from the product of his labour.
The last relation to be looked at here is man’s relation to his species. To some extent, this form of alienation is a reformulation of the other forms of alienation (ibid.) This is because, as Marx puts it, “in tearing away from man the object of his production… estranged labour tears from him his species life” (Marx, 1939, p.32). As aforementioned, consciously shaping the world around us is what sets humans apart from other species and is part of man’s essential nature (Marx, 1995). Thus Marx (199 wrote, and it is worth quoting at length:
“A spider conducts operations that resemble those of a weaver, and a bee puts to shame many an architect in the construction of her cells. But what distinguishes the worst architect from the best of bees is this, that the architect raises his structure in imagination before he erects it in reality. At the end of every labour-process, we get a result that already existed in the imagination of the labourer at its commencement.” (Marx, 1995 [1867], p.116)
It follows that when we are denied the opportunity to participate actively and creatively in our work, we are separated from our species life (Fischer, Marek and Bellamy, 1996). Furthermore, when we sell our labour, an essential part of human life, productive activity
becomes a mere means to an end (a wage). Marx points this out by outlining that estranged (abstract) labour “makes his life activity, his essential being, a mere means to his existence” (Marx, 1939, p.31). By treating labour as a means to an end, one of man’s natural powers – to work creatively and consciously – is transformed; working becomes like the effort of a silkworm, which spins only to continue its existence as a caterpillar (McLellan, 2000). 3.3 Alienation and Creativity
Now that we have a clear understanding of what alienation is and of its various forms, I shall turn to the impact of alienation on our capabilities. Through the various forms of alienation, the labour market significantly stifles creativity. Creativity is an important capability in itself because it is an important part of human nature. Creativity is also a prerequisite for development, hence limits on creativity are limits on development and thus the range of capabilities available.
Abstract labour, and the resulting alienation, has a significant impact on our ability to exercise and develop our creative capacities. The dominating force of abstract labour, and more specifically socially average labour time, means that we do not get the opportunity to develop our creative capabilities at work, where we spend most of our lifetime. As aforementioned, in the context of market exchange, the key to a sale is the average labour time, and this attenuates room for creativity. Let us say that I begin by making cakes to eat and share with my community. I will likely try new icing techniques, new recipes etc., because such creativity is inherent to humans and is also enjoyable. Yet, if eventually the cake becomes a means to earning an income, I must produce the cake at a certain speed and in a certain way so that I can keep the price low enough to be able to sell it (Holloway, Crack Capitalism). The pressure of socially average labour time means that questions of costs and time dominate my thoughts and my decisions in regards to my work. I necessarily become obsessed with keeping my abstract labour time, not out of greed, but just in order to sell my cakes and earn a living. With these thoughts dominating and dictating my decisions with regard to my labour, I have no room to exercise my creativity. We have no room to experiment because we are constantly faced with the need to conform to average labour times. This issue is particularly pertinent in the context of the Third Industrial Revolution, which refers to the digitisation of manufacturing (The Economist, 2012). Such a substantial wave of technological advancement will bring down the average socially necessary labour
