The Return of Economic Planning

Home , Capitalist state, Economic planning, Planned economy

Campbell Jones

Introduction: The Return of Economic Planning

This issue proposes to raise the stakes of Left political strategy by returning, in quite dierent ways than might be expected, to the question of economic planning. This comes at a moment when Left politics are at the same time gravely endan- gered and in a phase of radical renewal. Such a moment requires going back to central ideas and rethinking, reworking, and reframing them anew. While the ambition of the issue is to expand, extend, and radicalize Left politics, it is argued that this can be done not only by reclaiming economic planning but further by shifting the grounds of discussions of economic planning. The point, then, is not simply to defend economic planning but to draw out new understandings of economic planning, and in doing so to make conceptual and moreover strategic interventions into contemporary economic, social, and political struggle. When Jacques Lacan spoke in 1955 of a “return to Freud,” he stressed that this was any- thing but a return to the commonplace reductions to which Freud had been subjected. As Lacan insisted, the return to Freud was not the “return of the repressed” but a return to the meaning of Freud, in terms of a renewal of the revolutionary gesture of Freud’s calling into question of that

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which had been taken as truth (Lacan [1955] 2006). While it is possible to dream of a “return” to a world imagined to be integral and perfect, there is also a return that—with the deepest of respect for tradition—creates something new out of the old. There is something quite distinct about the “resur- rection” of an idea or a practice that has been subjected to reaction or obscu- ration (see Badiou 2009: 62ff.). If we speak of a “return of economic planning,” then, it must be remembered that something that is resurrected can be dierent and even better than the original. Let us be clear then. The return of economic planning that we have in mind has not one jot of nostalgia for the visions of economic planning that so readily leap to mind: Five-Year Plans; misguided and perverse plans with pointless objectives; the radical depoliticization of the planning process; the monopolizing of planning by sectional interests at the expense of others; the systematic silencing of dissenting or alternative plans; the ruthless brutal- ization of those failing to meet the plan. We know all of this, and we refuse all of this, not only because of historical failures of certain versions of Left economic planning, of which we are painfully aware, but just as much because our daily lives under capital today in so many ways resemble this planned nightmare. That the horrors associated with economic planning are today so easily connected with communism and even the most modest socialist or social democratic eorts to rein in capital should make clear the eectiveness of the ideological oensive that has been waged against the very idea of economic planning. The eort to create this ideational switching was performed with genius by F. A. Hayek in his Road to Serfdom ([1944] 2007), but it has also more broadly become the staple fare of the ideological imaginary of economic planning, for both the Right and the better part of the Left. This war has been very successfully waged by capitalist economics, and so economic planning has come to be associated with everything even vaguely undesirable to the capitalist class. In economics the repudiation of economic planning is so fundamental that it orders the most basic conceptual grounds of the discipline. This generally plays out through the conceptual trick of separating and then oppos- ing planning to “the market.” Indeed, the planning/market dualism is today so foundational and apparently intractable that it grounds the central catego- ries of capitalist economics even in its more apparently progressive strands. When leading economists even consider the prospect that there might be “alternative economic systems” or that there might be “fundamentally different ways of organizing an economy,” this generally translates into taking

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dierent positions along a continuum between on the one hand a “market economy” and on the other a “command economy” (Samuelson and Nord - haus 2010: 8). While economists do concede that all actual economies today are “mixed economies” that involve a combination of market and plan, the opposition itself has done its work. On this continuum every society has to decide between terms that are so loaded that everything is concluded in advance. On the one hand, there is a command economy in which there are “those on top of the hierarchy giving economic commands to those further down the ladder” while, on the other hand, there is a market economy in which “individuals or enterprises voluntarily agree to exchange goods or services” (Samuelson and Nordhaus 2010: 8). It has long been known that pitting hierarchy against the market ignores the incredibly hierarchical nature of almost every business organization and what it means to live daily life subject to arbitrary managerial command. This setup serves to occlude the very real powers of command that have always accompanied the rise and the continued expansion of capital and paints a fantastically egalitarian image of “the market” and the reality of coming face to face with massive corporations and the organized power of the rich and super rich. Capitalist power has of course rarely been satis¢ed to simply let the market do its magic, but rather has always carefully planned the extension of market forces, which it then withdraws or modi¢es when they are not achieving the desired ends. The capital-relation had to be forci- bly imposed through ongoing rounds of “primitive accumulation” through which capital created the space for its reign. Capital has always been accompanied by the capitalist state, to which it turns when it is unable to eect its designs through the “voluntary” agreement of individuals and enterprises. In one sense the planning/market opposition is a politically motivated obfuscation that must be abandoned. At the same time, and in a deeper and more subtle sense, it is not that the market/planning binary needs to be deconstructed one ¢ne day, but rather that every eort to pit the market against planning is doomed to fail, bringing with it intractable conceptual and practical contradictions. One of the key things that many of us learned from Jacques Derrida some years ago is that the simple reversal of an opposition leaves the terms and their opposition in place, while another form of crit- ical investigation is needed to interrogate what sustains the opposition and what the opposition occludes. This is a vital lesson with regard to economic planning. When faced with the massive destructive power of capital, many have been led to the conclusion that the solution is to replace the market with planning. Others, realizing that capitalism is already fully planned from top

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to bottom, are led to the conclusion that the solution is simply to repurpose capitalist planning but this time to place us in control of the machinery. In speci¢c local situations, such solutions are vitally important and are worth ¢ghting for. But beyond these, a quite dierent set of options open up in the space between and beyond the market/planning opposition. Beyond the capitalist market and absolutist command there is a vast continent of alternative ways of thinking about and practicing economic planning. Many of our struggles in recent years have been precisely over developing various experiments in “counterplanning” or “planning from below.” These forms of economic planning rest neither on capitalist planning nor state planning from above, and have opened up new ways of thinking about what it means to plan. These practices have been described by Stefano Harney and Fred Moten (2013) as the constantly present “fugitive” element that bubbles up and manifests itself in a range of what they describe as “black operations.” Whatever name we give to the third term that sits outside of the ways economic planning has for so long been understood and unsettles the opposi- tions on the basis of which it has been conceived, the purpose of this volume is precisely to draw out these often unrecognized eorts of economic planning and to think through their potential consequences.

The Planned Economy While planning has always been fundamental to capitalism, contemporary capitalism is the most intensively and extensively planned economy ever known. Any intervention in economic planning must take this reality as its starting point. Leigh Phillips and Michal Rozworski (2019) have demon- strated a number of the ways in which almost all capitalist organizations of a certain size are thoroughly planned, and they therefore take organizations such as Walmart and Amazon as exemplars of capitalist economic planning. The presence of planning at the heart of the most powerful capitalist corporations is palpable in the rule of bureaucratic forms of organization, and in the way that large organizations systematically bracket the market mechanism in order to increase internal predictability and control, and to avoid the “transactions costs” that many economists know accompany coordination of activity through the market. This rise of planning at the heart of capitalism today extends the movement from domination via tradition or charisma to rational/legal domination that was mapped more than a century ago by Max Weber. This shift involved the now well-known rise of hierarchy, formality, and depersonalization of protocols, command according to “o¦ces,” written

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¢les, and documentation, all of which are forced to accord to a set of objec - tives codi¢ed into a plan. Beyond large corporations, even the smallest capitalist faces the reality of business plans, ¢nancial projections, risk management, and contingency planning. The successful capitalist is relentlessly planning work§ows, quality and customer service improvement, expansion of production, and movement into international markets. Every manager is ultimately a planner, every capitalist ¢rm has a strategy, a vision, and a plan, and everyone who works for a capitalist organization has to be ruthlessly adjusted to the plan or disappear. While all of this points to the extent of planning of capitalist enterprise, the planned nature of capitalism today becomes even more apparent in the con- crete detail of capitalist economic activity. Accounting and ¢nancial management systems are mechanisms of planning. Strategic management, no mat- ter how §exible or “emergent,” involves the organization of everything into a plan. Risk management involves planning and costing contingencies and hedging or insuring against them. Logistics and operations management plan and track the movement of people and things. Information systems keep records and produce information about possible future plans. Outside of immediate boundaries of the capitalist ¢rm, economic planning has radically expanded as part of the normal activity of the capitalist state. This can be seen with startling clarity in the planning taking place in so-called “developing” economies such as India and China, both of which provide examples of buoyant capitalist economies that are marked by exten- sive state planning and massive state projects such as the Belt and Road Ini- tiative. The idea that such measures might be excused as being transitional on the way to a fully developed capitalism is disproved by the even more developed state planning of the economies of the global North. This involves, for example, the continuous monitoring of economic transactions and the daily management of macroeconomic policy. Since the 1970s this has involved constant intervention to stabilize in§ation, in order to provide propitious conditions for capitalist expansion and to avoid relative diminution of estab- lished wealth. In the most developed capitalist economies the “¢nancial markets” have repeatedly been rescued and are now kept on life support by macroeconomic management and trillions of dollars of bailouts and quantitative easing. These practices of direct government intervention are widely known to have been essential to prevent the collapse of global capitalism since 2007, which led to the European Central Bank pumping €2.6 trillion (approximately US$3 trillion) into the European economy between 2015 and 2018 (Carvalho, Ranasinghe, and Wilkes 2018). Governments throughout

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the world, meetings of heads of state, bilateral and multilateral trade agree- ments, and bodies such as the G7, G20, OPEC, the World Bank, the Interna- tional Monetary Fund, and the World Economic Forum have been con- sciously planning the radical extension of the global command of capital. These functions of state planning of the economy often operate at the opaque borderline between the operation of capitalist businesses and the capitalist state, to the point that each of these has taken on functions often imagined to belong to the other. Banks spend over 25 percent of their bud- get, which runs to almost US$100 billion annually, on regulatory compli - ance, compliance technology, and the costly processes of state control that management consultancies euphemistically refer to as “managing regula- tors” (Deloitte 2017). In this uneasy arm wrestle over the location of regula- tion of banking, capitalist ¢rms press back on the capitalist state and are then willing to compromise on such expenditures, eectively executing state functions in order to be allowed to extort massive pro¢ts. In practice, this is not about the capitalist or the state plan but about their constant eorts to externalize or outsource the costs of planning onto each other. Several dierent conclusions could be drawn from the reality of the rise of planning across capitalism. If we were to conclude that because capitalism is planned we need merely to seize control of the planning apparatus and wield it ourselves, this would leave in place many of the reasons that capitalism is so horrendous in the ¢rst place. Our strategic objective must not be to replace one group of planners with another, but rather to confront the system of coordinated command that capitalism is, and the catastrophic consequences it entails. Likewise, it is important that we avoid the temptation of thinking that we should meet the massive expansion of planning with paral- lel conceptual in§ation which could vaporize the concept of economic planning; or equally, the risk that we treat all forms of economic planning as if they were the same. In the face of this apparent “return” of economic planning what is crucial to remember is that economic planning never went away but that rather it expanded, moved and took dierent forms. The return of economic planning needs to be thought, then, as a topological torsion in which the key changes have been a stretching, twisting, and relocation of economic planning. The question is not whether or not to plan, nor is it merely the question of the appropriate extent of planning. The rather too obvious question of how much planning is desirable gets in the way of a much broader and much more promising politics of planning. In vitally important ways we on the left want less planning, less command, less surveillance, less monitoring and less intervention in our lives at work and outside it. The question,

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rather, is about where economic planning takes place, how economic planning is done, and who is included in the processes of economic planning. By such measures, the contemporary capitalist economy is not simply a planned economy but a “command economy” characterized by central planning. It did not take this form by chance or by the vagaries or “anarchy of the market.” The longstanding demand for democratic economic planning has always sought to respond, in one way or another, to the localization and exclusions on which capitalist economic planning rests (see, among others, Albert and Hahnel 1991; Cockshott and Cottrell 1993; Devine 1988). In this sense, any project of democratic economic planning is grounded in direct and broad-based refusal of the command of our lives and our futures by capital. It rests on a demand for a democratization well beyond and against the capitalist state of where economic planning takes place, how it is done and who is involved in the process.

Their Plans and Ours This issue of South Atlantic Quarterly appears precisely one century after Ludwig von Mises ([1920] 1935) published his renowned intervention that subsequently sparked what are known as the “economic calculation debates” or the “socialist calculation debates.” Advancing the idea that economic calculation without markets is not only undesirable but is moreover impossible, von Mises inspired some of the most brilliant eorts to justify capitalism in spite of all the evidence. In the hands of F. A. Hayek (1948, 1982) and in the wide range of diverse forms of capitalist economics that have drawn on von Mises and Hayek, the price mechanism was reframed as heralding the dis- covery of a new collective subject that can literally know and think for us. In such a liberal universe it is imagined that we plan best when we seek not to plan collectively, we think best when we recognize the limits to knowledge, and the ultimate pinnacle of democracy, as Jessica Whyte (2019) has shown, is found in our complete and unwavering submission to the market. To confront such ideas requires that we comprehend them in their pro- found depth and make clear their conceptual and political grounds. But to enter into debate with the prevailing visions of economic planning is not a polite dinner party tussle or a “debate” in which both sides agree over the basic terms. To confront economic planning is to enter into a contest that is at once profoundly theoretical and unavoidably political, over the constitutive ele- ments of the economy and the meaning of planning. In this the Left, if that word has any meaning, must represent a set of positions, claims, and politics

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that are irreconcilably dierent from those which prevail in capitalist economics and in capitalist ideology. Of course, we cannot and should not recoil from taking over the functions of economic planning as it stands today. But beyond this, placing economic planning at the forefront of Left thought and political strategy requires a clear articulation of the ways in which our vision of planning and the economy depart—without the prospect of reconciliation— from the capitalist order and the ways in which it is imagined. To this end it might be useful to recall one of the key lessons that Marx drew from his analysis of the Paris Commune of 1871, which is that the Commune did not seek merely to take over the existing infrastructure of the state but was premised on a radically dierent understanding of what governance and self-governance could be. In this Marx emphasized that the capitalist state cannot be simply reclaimed and repurposed, and that the ideals of governance and politics of the Commune were radically at odds with state capitalist power from above. He concluded, in short, that “the working class cannot, as the rival factions of the appropriating class have done in their hours of triumph, simply lay hold of the ready-made state machinery, and wield it for its own purposes” (Marx [1871] 2010: 548). Left political organization cannot simply seek to seize control of the means of economic planning. Rather, in our hands economic planning has a radically dierent meaning. I have tried to show elsewhere that a Left politics of work does not merely value work and workers more than the Right, but rather has an irreconcilably different understanding of work, the worker, and everything that work entails (Jones 2017). In the same way, the meaning of economic planning is something fundamentally dierent for us than for the Right. Because we have our own distinct understanding of economic planning, there is a kernel of truth in the fact that, according to the logic of capitalist economics, our projects are strictly speaking impossible. Of course, without knowing this and without that sense that we are facing up to the impossible, we have no politics in the proper sense of the word. This is why, when we speak with con¢dence about economic planning, we are also mak- ing clear the stakes and the ambition of our politics. For too long the so-called Left has staked its hopes on damage control, mitigation of suering, and remedies for suering after the fact. The capitalist class and its political and ideological representatives have grown in con¢dence by leaps and bounds in recent years and have mastered the art of thinking big and constructing grand designs beyond what was previously imaginable. For the Left the return of economic planning is a key move in saying not simply that we will make things less bad than they are at present, but that we have a dierent

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vision of the future and dierent terms by which we propose to judge the success or the failure of our plans. The call for a return of economic planning re§ects quite dierent visions of what economic planning is and can be. It is not some bureaucratic celebration of state planning nor does it have any delusions about the joys of popular assemblies or the tedium of meetings. But it does know that assemblies, meetings, and yes, planning, are things that can function in very different ways, for very dierent purposes, and with very dierent amounts of participation of the diverse population of this planet. To return to economic planning is to assess, once again, the merits of what capitalist economic planning is, to grasp how it took that form, and to wager on what other forms economic planning could take.

Note

Thanks to all of the participants in the “Return of Economic Planning” conference that was held in Auckland in February 2018 and was hosted by the Left think tank Economic and Social Research Aotearoa (ESRA) and supported by the New Zealand Council of Trade Unions (NZCTU). Thanks to all of the contributors to this issue for their contributions and persever- ance through the process. Particular thanks to Jonathan King at ESRA for his contribution to the conception of this project, to James Roberts and others in the Economic Planning Inquiry Group at ESRA for many discussions about economic planning, and to Nathalie Jaques and Shannon Walsh for valuable feedback throughout.

References

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