the participants would decide that this was often a reasonable way of dealing with the problem of discrepancies between supply and demand.
Public Goods Planning
My concerns about participatory planning of public goods are much less than about household consumption. Public goods do need to be discussed and decided on by public bodies, and it is certainly desirable as much as possible to have the deliberation over public goods be by the circles of people who will actually benefit from them. For many, perhaps most public goods, the appropriate level for such decision-making will be at a fairly macro level—cities and regions and even higher levels. But there certainly are some important public goods where the key domain of collective consumption is the neighborhood, and it is appropriate that the people directly affected have the major role in deciding the details on these. This is what, in a limited way, participatory budgeting of municipal infrastructure investments tries to do. Robin’s model of participatory planning of public goods can be thought of as a radical extension of some of the elements of participatory budgeting. I strongly endorse the general spirit of the idea that public goods planning should be maximally participatory at whatever geographical level is most relevant for a particular kind of public good.
The participatory decision-making over collective public goods consumption, however, does not require consumer councils that also approve or disapprove individual household consumption plans. What a neighborhood public goods council needs to decide is the division between public and private consumption within the neighborhood (i.e. how much of income that would otherwise go to households should be allocated to those public goods) and what specific public goods to produce. There is no inherent reason why this needs to be connected to approval of plans for what households consume privately. For this reason, I think it would be better to call these public goods councils than consumption councils.8
Unlike the planning for household consumption, public goods planning at whatever level it occurs requires real public deliberation: meetings, debates, bargaining, formulation of plans for specific projects, etc. Participatory planning of public goods—at the neighborhood level and beyond—will be a critical feature of a post-capitalist, democratic-egalitarian economy, especially because it is likely that the balance between private and public consumption will shift considerably in the public direction. Planning such public goods in a deeply democratic way, however, will be arduous, not simple, because it is unlikely there will be a smooth consensus over the balance between household consumption and public goods or over the specific mix of public goods. This will raise the Oscar Wilde problem of socialism taking up too many evenings, but it is worth it.
There is one set of issues around public goods planning in Robin’s model that was not clear to me: the role of Government institutions rather than just consumer federations. On one interpretation of Robin’s participatory economics model, virtually all government functions are replaced by consumer councils and federations and by worker councils and federations. There might still be a role for government around certain kinds of rule making and rule enforcing—for example, things like speed limits or enforcing the accurate reporting of pollution discharges so the planning process (however it is organized) has accurate information with which to deal with externalities. But the government would have no responsibility for planning and producing any kind of public goods.
There may be reasons, however, to make a distinction between the way public goods are connected to people as consumers and public goods that are linked to their status as citizens. For one thing, some public goods do not fall neatly into the distinction between consumers and producers. Educational public goods, for example, serve people’s needs both as producers and consumers, and the same can be said for health care. Public transportation systems are public goods for people both as consumers and producers. Democratically accountable government institutions might be more appropriate than consumer or producer federations for providing these kinds of multidimensional public goods and monitoring their performance. But it is also the case that there is a range of public goods (or aspects of public goods) which, in certain important ways, serve the needs of people neither as consumers or producers but as members of a community. Public gathering places are public goods, and in a sense they are “consumed” by people when they gather for public purposes, but this is only one aspect of their social meaning. They also contribute to constructing a public sphere and public identities. Public spaces for performing music and theater are a public good in which these activities are consumed by audiences and produced by performers; but they are also sites for the collective project of affirming cultural identities and purposes. Aspects of the mass media are like this as well insofar as the media contribute to civic mindedness and solidarities.
Perhaps these kinds of civic public goods would be adequately attended to by nested councils and federations organized around consumption. But perhaps not. It may be that they would be better fostered by citizens’ assemblies organized as political bodies within a federated state structure. As a sociologist I am somewhat skeptical that a system of councils organized around the social role of people-as-consumers and institutionally embedded in a planning process concerned with negotiations with workers’ federations through the intermediation of the IFB’s management of indicative prices is the optimal setting for deliberations over civic public goods.
The Problem of Externalities
One of the most important elements in Robin’s critique of markets is their inability to adequately take account of negative and positive externalities of production on their own. If there were no negative and positive externalities, and if there were no concentrations of power in markets (and thus no monopoly rents), then the equilibrium prices of goods in markets would be unlikely to differ dramatically from those generated by participatory planning. Both systems would produce prices closely in line with the total real costs of production.9 But of course, there are substantial positive and negative externalities. Among the most interesting and original parts of the model of participatory economics is the way Robin proposes to deal with these issues.
The key problem for any planning process with respect to externalities is figuring out a way to assign quantitative values to externalities so that these can be adequately reflected in the prices of the things that people consume. Assigning a value to such costs and benefits involves two steps. First, there is a technical problem of identifying the inventory of actual negative and positive side-effects of a given production process. This is the work of scientists and technical experts. For example, environmental negative externalities, involve identifying the amounts of different pollutants generated in a given production process, and scientifically showing what the ill-effects of given levels are. Producers, of course, should be required to report these levels, and this generally requires some kind of monitoring and enforcement mechanism, but these levels only have meaning in a planning process when there is a way of assessing the harms they cause. This is where science plays a pivotal role: providing information about such things as the increase in risk of cancer caused by a given level of a particular pollutant.
This brings us to the second step: figuring out the value to be placed on the harm. It would always be possible, of course, to declare that zero pollution is the only acceptable level. This could, however, turn out to be enormously costly in many situations, and thus some device needs to be concocted to put a value on the harms caused by a given level of pollution compared to the costs of reducing the pollution. This is where Robin’s model has a particularly original suggestion. Basically he proposes that federations of consumer councils at the appropriate geographical level in which an environmental negative externality of production is present be allowed to decide on the level of compensation they need in order to be willing to accept a given amount of pollution. This is like saying: I’ll be happy to have a cancer risk increase by 10 percent if you increase my consumption by 20 percent. Here is how the process works:
In each iteration in the annual planning procedure there is an “indicative price” for every pollutant in every region impacted representing the current estimate of the damage, or social cost of releasing a unit of that pollutant into the region. What is
