In the former Greek finance minister’s latest book, Another Now: Dispatches from an Alternative Present, he presents a humane alternative to financialised capitalism.
https://www.theguardian.com/books/2020/sep/04/yanis-varoufakis-capitalism-isnt-working-heres-an-alternative If cathedrals were the middle ages’ architectural legacy, the 2020s will be remembered for electrified fences and flocks of buzzing drones. Finance and nationalism, already on the rise before 2020, were the clear winners. The great strength of the new fascists was that, unlike their forerunners a century ago, they don’t need to wear brown shirts or even enter government to gain power. The panicking establishment parties – the neoliberals and social democrats – have been falling over themselves to do their job for them through the power of big tech.
To stop new outbreaks governments tracked our every move with fancy apps and fashionable bracelets. Systems designed to monitor coughs now also monitored laughs. They made earlier organisations specialising in surveillance and “behaviour modification”, like the infamous KGB and Cambridge Analytica, seem positively neolithic.
What was the moment when humanity lost the plot? Was it 1991? 2008? Or did we still have a chance in 2020? Like epiphanies, the fork-in-the-road theory of history is a convenient lie. The truth is we face a fork-in-the-road every day of our lives.
Suppose we had seized the 2008 moment to stage a peaceful hi-tech revolution that led to a postcapitalist economic democracy. What would it be like? To be desirable, it would feature markets for goods and services since the alternative – a Soviet-type rationing system that vests arbitrary power in the ugliest of bureaucrats – is too dreary for words. But to be crisis-proof, there is one market that market socialism cannot afford to feature: the labour market. Why? Because, once labour time has a rental price, the market mechanism inexorably pushes it down while commodifying every aspect of work (and, in the age of Facebook, our leisure too).
Can an advanced economy function without labour markets? Of course it can. Consider the principle of one-employee-one-share-one-vote underpinning a system that, in Another Now, I call corpo-syndicalism. Amending corporate law so as to turn every employee into an equal (though not equally remunerated) partner is as unimaginably radical today as universal suffrage was in the 19th century. In my blueprint, central banks provide every adult with a free bank account into which a fixed stipend (called universal basic dividend) is credited monthly. As everyone uses their central bank account to make domestic payments, most of the money minted by the central bank is transferred within its ledger. Additionally, the central bank grants all newborns a trust fund, to be used when they grow up.
People receive two types of income: the dividends credited into their central bank account and earnings from working in a corpo-syndicalist company. Neither are taxed, as there are no income or sales taxes. Instead, two types of taxes fund the government: a 5% tax on the raw revenues of the corpo-syndicalist firms; and proceeds from leasing land (which belongs in its entirety to the community) for private, time-limited, use.
Once share markets have disappeared, the need for gargantuan debt to fund mergers and acquisitions evaporates – along with commercial finance
When it comes to international trade and payments, Another Now features an innovative global financial system that continually transfers wealth to the global south, while also preventing imbalances from causing strife and crises. All trade and all money movements between different monetary jurisdictions (eg the UK and the eurozone or the US) are denominated in a new digital accounting unit, called the Kosmos. If the Kosmos value of a country’s imports exceeds its exports, it is charged a levy in proportion to the trade deficit. But, equally, if a country’s exports exceed its imports, it is also charged the levy. Another levy is charged to a country’s Kosmos account whenever too much money moves too quickly out of, or into, the country – a surge levy of sorts that taxes the speculative money movements that do such damage to developing countries. All these levies end up as direct green investments in the global south.
But it is the granting of a single non-tradeable share to each employee-partner that holds the key to this economy. By granting employee-partners the right to vote in the corporation’s general assemblies, an idea proposed by the early anarcho-syndicalists, the distinction between wages and profits is terminated and democracy, at last, enters the workplace.
From a firm’s senior engineers and key strategic thinkers to its secretaries and janitors, everyone receives a basic wage plus a bonus that is decided collectively. Since the one-employee-one-vote rule favours smaller decision-making units, corpo-syndicalism causes conglomerates voluntarily to break up into smaller companies, thus reviving market competition. Even more strikingly, share markets vanish completely since shares, like IDs and library cards, are now non-tradeable. Once share markets have disappeared, the need for gargantuan debt to fund mergers and acquisitions evaporates – along with commercial finance. And given that the Central Bank provides everyone with a free bank account, private banking shrinks into utter insignificance.
Some of the thornier issues I had to address in writing Another Now, to ensure its consistency with a fully democratised society, included: the fear that powerful people will manipulate elections even under market socialism; the stubborn refusal of patriarchy to die; gender and sexual politics; the funding of the green transition; borders and migration; a bill of digital rights and so on.
Writing this as a manual would have been unbearable. It would have forced me to pretend that I have taken sides in arguments that remain unresolved in my head – often in my heart. I, therefore, owe an immense debt of gratitude to my spirited characters Iris, Eva and Costa. Above all else, they allowed me seriously to ponder the hardest of questions: once we have conceived of a feasible socialism that blasts Thatcher’s Tina out of the water, what must we do, and how far are we willing to go, to bring it about?
Another Now by Yanis Varoufakis is published by Bodley Head. To order a copy go to guardianbookshop.com. Delivery charges may apply.
See book highlights from Another Now — better than the below.
What would a post-capitalist society look like, if it was to avoid replicating the failed Soviet model? In which, important ways, will its economic and social institutions be dissimilar to modern capitalism’s? Will the market have a place in that society’s scheme of things? If the answer to this last question is yes, and assuming that its market economy will be far removed from what passes for laissez faire, what forces will shape and regulate the market?
What all, if anything, will stay strictly off-limits for markets? What kind of glue will hold together a society that enshrines justice, fairness and equality as its core principles, even as it continues to have markets and competition driving its growth? Yanis Varoufakis’s latest book, Another Now: Dispatches from an Alternative Present, addresses itself to these questions. This is the economist-political activist’s first foray into fiction, to boot, science fiction – although the narrative here both builds on and derives from what clearly is an article of faith with this former Greek finance minister: that there is life after capitalism. In other words, that ‘another now’ is no utopia, and an ‘alternative present’ is well and truly within humankind’s reach today.
But in fleshing out his idea of the alternative present, Varoufakis needed to break much fresh ground: for, although the literature on how capitalism can possibly transition to post-capitalism is admittedly copious, there is very little by way of an explication of the shape of things after the transition. Karl Marx himself abstained from specific comments on the economics and economic institutions of socialism, and said nothing about what communist society would likely look like. Nothing, that is, other than the laconic catchphrase that his Critique of the Gotha Programme popularised — “From each according to their ability, to each according to their needs” – which is fine as an overarching principle, but hardly a workable guide to action.
A very large majority of 20th-century socialists implicitly believed that a post-capitalist society would be based — to quote from the constitution of the British Labour Party — “on the common ownership of the means of production”, generally understood as achievable by nationalising a country’s industries. Every would-be socialist regime began, in its time, to reorganise its economy around this principle which, together with an architecture of centralised planning of virtually all input and output across all the sectors of the economy, served as the prototype of ‘really-existing socialism’. Every other facet of its post-transition society was necessarily improvised by that society according to its own lights and its own special circumstances, and there was precious little that two of such societies had in common, the (then) USSR and China being cases in point.
And the 1980s and 1990s blew really-existing socialism into smithereens. Socialist states imploded, or mutated into pathetic apologies of socialism. Worldwide, if movements for social and economic justice did not fully run out of steam yet (principally in Latin America), they were routinely overwhelmed by both the shrill rhetoric and the predatory practices of neoliberalism. A ‘spanking new spiv capitalism’ managed — thanks to colossal taxpayer-funded bailouts — to shrug off the disaster of the 2008 meltdown, began to pretend nothing had changed, and stepped up the decoupling of financial capital from the real economy — evident in the dizzying rise in many stock market indices despite a crippling COVID-19-induced slowdown.
At the same time, governments everywhere arrogated to themselves massive new powers, ostensibly to combat the epidemic and its fallout, but in effect capitalising on the opportunity to delegitimise dissent and fully disempower the chronically marginalised. The blueprint of a humane alternative to financialised capitalism has, therefore, never been a more pressing need. In Another Now, Varoufakis attempts just that.
The first thing to note about Varoufakis’s blueprint is that the model it foregrounds is one of democratic socialism. Here democracy and socialism not only coexist: they mutually reinforce and deepen each other. The model breaks down into the following main components:
- Markets – Markets for goods and services feature prominently in the model, because the markets’ surrogate – a Soviet-style rationing system – is flawed on several counts. One, it vests arbitrary and virtually limitless power in the bureaucracy, rapidly spawning a class of privileged mandarins who become de facto rulers. Two, it fetters growth and prosperity and hence is inefficient. And three, unable to work without artificial price controls, it skews a country’s finances. One kind of market is absent from Another Now’s scheme of things, though: the labour market;
- Labour – Even market socialism cannot afford to feature the labour market, because it ceases to be socialist the moment it allows labour power to go on the market. This is so because once labour time has a rental price, the market mechanism inexorably pushes down that price, while also commodifying every facet of labour. Where does labour come in, then? Via what Varoufakis calls corpo-syndicalism;
- Corpo-Syndicalism – Here the labour market is substituted by the principle of one-employee-one-share-one-vote. Every employee of a business enterprise acquires a single, voting, non-transferable, non-tradeable share of his firm upon joining it. This elevates him from being a mere cog in the wheel to a part of the very wheel that steers and runs that business. The worker then transmutes into a partner of the business that employs him — an equal partner with respect to every other colleague of his (Equal, but not necessarily equally remunerated, as we will see presently). The distinction between wages and profits thus disappears, and true democracy enters the workplace for the first time. As unimaginably radical as this sounds in ‘our now’ today, it is surely no more radical than the idea of universal suffrage was in the 19th century. And yet, today, in any society, we take everyone’s right to vote as a given. Early 20th century anarcho-syndicalists were champions of the owner-employee concept, but since the initiative in Another Now comes from the business entities themselves, it becomes corpo-syndicalism here;
- Democratic Inequality – Every employee of a firm, from its janitor to its senior manager, receives a basic wage plus a bonus. The quantum of the bonus is decided collectively on the basis of merit points that each employee awards (out of a pre-determined total that each is allocated) to all her colleagues in proportion to her perception of each colleague’s contribution to the firm’s business. The merit points thus earned by each employee are then added up to ascertain the eligible amount of her bonus. The bonuses are drawn from the annual corpus of distributable surplus identified by the firm every year. This is how different employees are differently remunerated. But this is a democratic variant of inequality: the employee’s position or power has no bearing upon the bonus she receives;
- Small is beautiful – The compensation structures, plus the one-employee-one-share-one-vote rule clearly favour relatively small firms over mega corporations. No wonder, then, that the world of Another Now is made up of modest-sized businesses, clearing the field for competition, and curbing monopolies, cartels and trusts. (The business of managing large utilities is handled by governments on a break-even costing basis.) The fact that smaller businesses are better able to reduce their carbon footprint is another positive weighing in their favour;
- The withering–away of finance capital – Businesses owned and held together by non-tradeable shares render stock markets redundant. Again, with the disappearance of giant firms, the need for gargantuan debt to finance mergers and acquisitions vanishes altogether. Big-ticket commercial loans and the whole paraphernalia of project and structured financing are soon forgotten categories. The tyranny of the market-place comes to an end. With it, also the arrogance of finance capital;
- The state – The state is neither minimalist nor overbearing, many public works being community-driven. It manages the commons (that is, land which is leased to individuals and communities for time-limited use) and enables the hassle-free and non-discretionary working of public institutions. It is funded by two income streams: a flat 5% tax on raw revenues (not profits) of firms and the lease rentals on land. There are no income,wealth or sales taxes;
- Citizens – At birth, every citizen comes into a ‘Legacy’ account opened and funded by the state in her name in the country’s central bank, available to the citizen once she turns 60. The state also opens for her a ‘Dividend’ account into which is deposited every month, through the citizen’s entire adult life, a fixed amount which is in the nature of a universal basic income. As a working adult, the citizen is also entitled to her ‘Accumulation’ account which receives her salaries, bonuses and other income. Since all three types of accounts are held in the central bank, easy audit and full transparency are assured;
- The International Monetary Project — The IMP, Another Now’s equivalent of the IMF, holds to a Bretton Woods-type of a convention of maintaining relative parities between different national currencies. It monitors transnational trade, payments and money transfers — all denominated in a digital accounting unit called Kosmos — and corrects incipient imbalances across geographies so as to avoid stresses and crises. Every country running a trade deficit/surplus is required to pay a levy to the IMP. Another levy — something like a surge penalty to discourage speculative cash movements — is charged to a country’s Kosmos account whenever too much money moves too quickly out of, or into, that country (Cash flows from all such levies are redirected to the relatively poorer countries to bolster their economies).
Another Now goes on to draw the contours of the regulatory and judicial systems, too. Special attention is given to delineating the regulatory oversight of the use of shared resources such as land. Everywhere, the emphasis is on simplicity, transparency, and nondiscretionary decision-making. And on the spirit of open democracy that suffuses every public institution.
This is not to say, however, that everything in Another Now functions like clockwork. Checks and balances falter sometimes; powerful people try to manipulate elections just the same; patriarchy refuses to die; sometimes gender and sexual politics still play out in unwholesome ways; migrants in search of better lives are not always welcome. Overall, though, there is strong public opinion in favour of justice and common decency, and nearly every deviant behaviour shows up as an outlier. Be that as it may, that thorny issues can survive broad-spectrum social change is a sobering thought.
Woven around fictionalised characters
But it will be a mistake to read Another Now as a political treatise, even though its aspirations are clearly political. Varoufakis has crafted an endearing tale around the lives of three very dissimilar, but equally feisty characters: a maverick technologist, a non-dogmatic Marxist-feminist, and a libertarian ex-banker.
Their disagreements and dissatisfactions about 21st century capitalism provide the backdrop against which the book’s socialist blueprint is projected, assessed and finessed. It is their brainstorming sessions and never-flagging dialogic zeal that drives the story forward, but the characterisation is nuanced enough that one looks forward to their animated encounters and interfaces with pleasure. And the story builds up steadily and surely, never ever allowing the momentum to slacken.
At the plot’s core lies an ingenious thought-experiment involving a tiny, subatomic fold in space-time which apparently opens into ‘an Einstein-Rosen wormwhole’, making it possible for our protagonists to communicate seamlessly with ‘another now’, the living utopia around which the story unfolds. The transition from ‘our now’ to ‘another now’ is believed to have taken place through a process which comes across as a tad wishy-washy, but this, after all, is the story of an imagined future, not of our dreary present, and if dreams do not fly on wings of fancy, what will?
The great merit of Another Now lies in the courage of its conviction that a decent, humane future for all of us is not only possible, but it also may really not be very far from us even as we go through our quotidian lives today. By reimagining the future as an altered present — however radically altered it may be in some ways — the book imparts a sense of immediacy to the old but enduring dream of a just society. Written in a crisp, lively idiom, Another Now is not only a marvellously good read — it is a notable addition to the literature of social change.