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Proposing a Path to Socialism: Two Papers for Hugo Chávez

Michael A. Lebowitz worked between 2004 and 2010 as an adviser in Venezuela. His Contradictions of ‘Real Socialism’: The Conductor and the Conducted (2012) and The Socialist Alternative: Real Human Development (2010) are both available from Monthly Review Press.

It is now one year since the unfortunate death of Hugo Chávez on March 5, 2013. Shortly after, the editors of Monthly Review quoted a letter from István Mészáros to John Bellamy Foster which described Chávez as “one of the greatest historical figures of our time” and “a deeply insightful revolutionary intellect” (“Notes from the Editors” in the May 2013 Monthly Review). Whether Chávez will be remembered over time this way, however, depends significantly on whether we build upon the foundations he began. As important as his vision and his deep understanding of the necessary path (so clearly demonstrated by his focus upon communal councils as the basis of a new socialist state—“the most vital revolutionary achievement in these years,” as the editors indicated) was Chávez’s ability to communicate both vision and theory in a clear and simple way to the masses. As demonstrated by Chávez’s articulation of the concept of “the elementary triangle of socialism,” that is what revolutionaries must learn to do.

Following Marta Harnecker’s long interview with Chávez (later published as Understanding the Venezuelan Revolution by Monthly Review Press), he asked her to come to Venezuela in 2003 to serve as his advisor and explained that he wanted someone around him who would not hesitate to criticize him. And that’s how we ended up in Venezuela. At the beginning of 2004, I became an adviser to the Minister of the Social Economy and, during that year, Marta and I became convinced that it would be important to create a center which could bring together foreign advisors who supported the Bolivarian Revolution. Accordingly, she proposed to Chávez that an institute be established for this purpose; he agreed, and, after we assembled people and found a home for the Institute (ultimately in the Ministry of Higher Education), the Centro Internacional Miranda (CIM) was formed in early 2006.

Since it was clear that Chávez would be re-elected in December and would be thinking seriously about directions for the new mandate, those of us involved in CIM decided to prepare a series of papers proposing initiatives which we felt could advance the process of building socialism in Venezuela. Although several of us engaged in these discussions, ultimately only three of the CIM directors (Marta Harnecker, Haiman El Troudi, and I) completed papers for transmission to Chávez in early December. In what follows, I include an excerpt from one paper I prepared plus a second paper subsequently developed in response to Chávez’s reaction to the first.1

Building New Productive Relations Now

Everyone understands that it is impossible to achieve the vision of socialism for the twenty-first century in one giant leap forward. It is not simply a matter of changing property ownership. This is the easiest part of building the new world. Far more difficult is changing productive relations, social relations in general, and attitudes and ideas.

To transform existing relations into the new productive relations, we need first of all to understand the nature of the existing relations. Only then can you identify the mechanisms by which the new relations can be introduced. At this time, there is a great variety of experiments and approaches to changing productive relations which are being pursued. There is no attempt to set out specific proposals here but only to provide the framework in which such changes should be explored in order to move toward socialist productive relations.

The first step is to understand the direction of change. The precise pace of transformation will depend upon the existing conditions, the conjuncture, and the correlation of forces (national and international).

A. Existing Productive Relations

It is essential not to confuse property relations with productive relations. For example, a state-owned firm could be (a) worker-managed and functioning in a market with the goal of maximizing income per worker (as in the self-managed enterprises in the former Yugoslavia), (b) a profit-maximizing state capitalist firm, or (c) what we call for our purpose here a “statist” firm—a productive unit directed by the state to achieve specific targets in terms, e.g., of output or revenue. Similarly, a cooperative may be focused upon maximizing the income of its members or solving local needs. And, in all these cases, there is always the possibility of managers and managerial elites directing the enterprises in their own personal interests because of the difficulties in, for example, the state or stockholders monitoring and sanctioning their activity (as occurred in the old PDVSA).2

1. Capitalist Productive Relations

We understand capitalist productive relations as those in which workers enter into a relationship with capitalists in which they surrender their ability to work (and their claim upon what they produce) to capitalists. What workers get from this transaction is a wage that provides for their maintenance; what capitalists get is the right to direct their employees in such a way as to profit from their ability to work, the right to own everything that workers produce, and the right to determine what is produced and how it is produced. These relations may take different forms—e.g., workers may have more or less control over the production process and they may receive a portion of their wage in the form of profit-sharing (which means that they share in the risks of the capitalist); however, characteristic of capitalist productive relations is (a) that everything is subordinated to the generation of profits and the accumulation of capital, and (b) the capitalist is working constantly to increase those profits however possible.

Thus, the system drives toward the greatest possible exploitation of workers and the greatest possible use of resources for which the capitalist does not have to pay (e.g., clean air and water); workers and society may succeed in winning some battles from time to time, but the logic of capital is always to attempt to undermine and reverse those victories sooner or later. And that is because the logic of capital is opposed to the logic of human development and human needs.

2. Cooperative Productive Relations

Cooperative relations exist where workers are associated in particular enterprises in their mutual interest as producers. Both in the case where workers are the owners of the means of production or where the means of production are owned by the state and entrusted to the collective of workers, the inherent logic of the cooperative as a separate unit is the same: maximize the income per member of the cooperative. Accordingly, characteristic of a cooperative is that it looks upon members of other cooperatives (and members of society as a whole) as either competitors or as potential sources of income as customers. The logic of the cooperative is the self-interest of the group; in this respect, taxation of the cooperative by the state, by reducing the net income of its members, appears as a burden contrary to the interests of the group.

Thus, the logic of the cooperative as such is not a focus upon human development and solidarity within society as a whole. The cooperative retains the self-orientation of the capitalist firm and may function atomistically in the market in the same way as capitalist firms. Nevertheless the differences between cooperatives and capitalist firms are immense. In the cooperative, workers do not surrender their ability to work or their right to determine how they will produce or their claim over what they produce. Rather, they combine or pool their capacities in their common interest and, instead of keeping their tacit knowledge to themselves and finding ways to minimize their work, the logic of the cooperative leads them to share their knowledge and their ability because they are the beneficiaries.

Precisely because of this collective interest and this conscious combination of activity, cooperatives build solidarity within the specific group and teach a lesson about the benefits of cooperation. At the same time, however, this orientation toward the interests of the specific group (and toward “group property”) is consistent with the exploitation of other workers (non-cooperative members) as wage-laborers and with actions in the interest of the group which are contrary to the interests of society. Nevertheless, the two-sided nature of relations within cooperatives suggests the potential of building new productive relations upon them.

3. Statist Productive Relations

Characteristic of statist relations is that enterprises are given specific directives by the state and are expected to fulfill these. Insofar as the goal of the state is to meet a specific output or revenue target or to maximize revenue for the state budget, the resources of the statist unit will be directed toward meeting this goal.3 Further, the counterpart of the directive or command given to the statist enterprise will be the directive or command transmitted within that enterprise; hierarchy is characteristic of the statist enterprise: orders are transmitted downward. Thus, democracy and worker decision-making are not characteristic; rather than the disruptions in state goal achievement that may result from the differing goals of workers, the preferred role of an organization of workers from the statist perspective is to mobilize human resources to meet the selected goal—i.e., to serve as a transmission belt for state directives. In this respect, from the perspective of workers the statist firm may be no different than the capitalist firm.

Similarly, insofar as meeting the chosen output or revenue targets is paramount, efficient use of resources (including the environment) may tend to be sacrificed in the interests of reaching those targets. Despite state goals which are formulated in the interests of society as a whole, the fact that specific directives are given to individual productive enterprises means that their efforts to achieve them may stimulate behavior which is in the interests of the particular enterprise rather than in that of the whole. Such a pattern is particularly likely where the income or career path of enterprise managers depends upon their success in meeting these assigned targets. In fact, the private interests of those managers may yield many anti-social effects with the result that the statist firms do not act in the interest of society as a whole. Where statist enterprise managers are not committed to the goals of the state and where their behavior is not easily monitored, the performance of those enterprises will appear incoherent because they reflect the presence of a different set of relations. The existence of managers with their own goals and the difficulty of monitoring them from above was characteristic of the enterprise in the former USSR.4

The logic of the statist enterprise, accordingly, is two-sided. While it potentially can be directed in the interests of society as a whole and is essentially oriented toward production of use-values rather than profits, in the absence of specific directives which stress the interests of workers and society as a whole, and the transparency which is a precondition for monitoring and empowering of workers and communities, the statist enterprise can be captured by particular interests.

B. Transforming Existing Productive Relations

The steps that must be taken to make a transition from existing relations to the new productive relations and the pace at which the changes can be made depends upon the starting point.

1. Transforming Statist Enterprises

Without question, the easiest transition can be made in the statist firm—it is already at the threshold of new productive relations. Unlike the explicit private interests in capitalist and cooperative productive relations, the statist firm already is in form the property of society as a whole and has as its explicit directive to act in the interests of society as a whole.

The path to transform the logic of statist enterprises, then, is to change the directives which they are given by the state. If the new productive relations which are to be built emphasize as a goal the full development of human potential and the creation of new socialist human beings, the nature of these institutions and the instructions given by the state must include the conditions necessary for the realization of this goal. With the development of workers councils and the growing orientation of their activity toward meeting the needs of communities (as expressed by those communities themselves) and with the transparency which allows waste, corruption, and bureaucratic self-interest to be challenged, statist enterprises increasingly can be characterized by socialist productive relations. This is not an easy process, of course, because the habits, traditions and common sense of both capitalist and statist firms is that decisions should be made at the top and transmitted downward; for this reason, success in this process depends upon the selection of managers who share the vision.

To the extent that the statist enterprise moves in the direction of new socialist relations emphasizing the full development of human capacity, it no longer can be evaluated by the measures of traditional capitalist accounting. State directives such as, for example, transformation of the workday to include education in the workplace, transitional phases in the development of worker participation, and improvement of environmental conditions are directives to invest in human development. Thus, rather than view the specific enterprises which follow such social policies as “uneconomic” or money-losing, those policies are social investments whose cost must be born by society as a whole.

2. Transforming Cooperatives

The transformation of cooperatives concerns not only those where the means of production are owned by a group of workers but also the case of state-owned enterprises which are self-managed and enterprises which are a combination of state and group ownership. Despite the difference in property ownership, common to all is that the prevailing logic is to maximize income per worker within the group.

Besides this group self-interest, however, this institution contains the essential ideas of cooperation and democracy—which are at the core of the new relations which must be built. The transition here, then, must take the form of encouraging the cooperative to move beyond its narrow self-orientation and to develop organic links to society.

A first step would be to develop links between groups of workers, i.e., members of differing cooperatives. With the establishment of a Council of Cooperatives in each community, it would be possible to explore the way in which these groups of workers could cooperate in activities rather than compete and, in general, to investigate ways in which cooperatives can integrate their activities directly without being separated by market transactions. Further, links could be established between the Councils of Cooperatives in each community and communal councils. With the support of the communal banks, the needs of local communities could be communicated to the organized cooperatives as a way of moving toward production for communal needs and purposes.

The process of transforming the productive relations of cooperatives, thus, is one of guiding them step-by-step beyond their own narrow interests into a focus upon the needs of communities. In other words, cooperatives are at another threshold of socialism for the twenty-first century. Both the statist enterprise and the cooperative have in common that they are not capitalist enterprises; rather, they are part of the social economy, which can “walk on two legs” on a path toward socialist productive relations.

However, there is nothing automatic about this process. The logic of capital can dominate both, and can turn both statist firms and cooperatives into complements and supports for capitalism. Being on the threshold of socialist productive relations does not mean you will ever cross that threshold.

3. Transforming Capitalist Enterprises

Capitalism is not at that threshold, and it will never be. The essence of capitalism is the exploitation of workers and the orientation toward profit at the expense of every human being and every human need. We can never use the logic of capital to build new social relations. Rather, it is necessary to go beyond capital and to subordinate its logic to the logic of the new society.

Part of the process of subordinating capitalism to a new social logic is by introducing the transparency necessary to monitor the activity of capitalist enterprises. With a new law on transparency, making the financial records (including records of transactions with other entities) of all business enterprises of a minimum size (e.g., over twenty-five workers) available to inspection by workers and tax officials, the information available for a democratic, participatory, and protagonistic society would be increased. Those enterprises unwilling to provide this information would be understood to be acting against the public interest and, thus, would be operated in a transparent way instead by the state or groups of workers.

A rupture of property rights in this way—i.e., nationalization by the state or a take-over by collectives of workers—is one of three ways to subordinate existing capitalist enterprises within a country. Certainly, this does remove these capitalist enterprises and the capitalist interests behind them as threats to a new socialist society. As noted earlier, however, changing property rights is not the same as developing new productive relations. At best, this only takes us to the threshold (in the form of statist firms and cooperatives) of those new relations. In fact, a private capitalist firm may simply be replaced by a state capitalist firm which exploits workers and destroys the environment—all in the interests of maximization of profits. Thus, while existing capitalist enterprises may be subordinated in this way, we have seen that more is needed to introduce new productive relations.

A second way to subordinate existing capitalist firms is by extracting and transferring the surpluses generated in those firms. Through taxes or prices (e.g., forms of “unequal exchange”), surpluses generated within these firms may be siphoned off to other sectors (e.g., new firms being created) or to the support of social programs—rather than realized as profits. A similar assault on the profitability of these enterprises could be through competition with state-owned firms or subsidized cooperatives. Certainly, such inroads upon the profits of capitalist firms will reduce their viability, and their subsequent absorption by the state or workers would likely follow in the public interest in order to maintain jobs and production.

Whereas the above cases involve an external assault on existing capitalist firms, a third approach to their subordination involves the invasion of an alien logic, the logic of new productive relations within those enterprises. The premise here is not that capitalism can be reformed or that it can change but, rather, that its orientation toward profit-maximization will be constrained by the existence of new requirements. For example, the existence of strict environmental standards compels the capitalist enterprise which wants to remain in operation to accept these as a cost of doing business and to continue, within this new constraint, to attempt to maximize profits. In the same way, government directives which require enterprises to transform the workday to include educational training, introduce specific forms of worker decision-making (such as workers councils), and devote a specific portion of resources to meet local community demands will impose costs upon these firms which would be still consistent with the logic of capital—the drive to maximize profits.

But, why would capitalist enterprises accept such imposed costs when they can go to other locations in the world where those particular costs are not present? They would do so if this were a condition to having access to scarce local resources, to credit from state banks, and to the market that state enterprises and the state offer. In other words, the state can use its leverage (where it wishes) to change the ground rules under which capitalist enterprises which are not footloose can do business with it.

Does this change them from being capitalist firms? Does it mean that they no longer exploit workers? Obviously not. Why, then, would a state which wishes to transform productive relations accept the continued existence of these capitalist firms? It would do so only if the limited economic and technical resources at its disposal make it rational for it to work for a period with capitalist firms constrained in this way.

The process of introducing these conditions (“socialist conditionality”), though, is the insertion of new, alien productive relations within the capitalist firm. The combination of state directives which enforce the development of workers councils (with increasing responsibilities) and a growing orientation toward meeting community needs makes the capitalist enterprise contested terrain. And, the struggle within these firms will continue: just as capitalist firms in this case will be constantly attempting to lessen and reduce the burden of “socialist conditionality,” the state—in cooperation with workers and communities—will be working to introduce into these enterprises further elements characteristic of the invading socialist society. In short, we are describing here a process of class struggle in which the goal of socialism for the twenty-first century is the complete replacement of the logic of capital by the logic of a new socialist society.

From Mészáros to Concrete Proposals For Transforming Venezuela

In the following week, Marta Harnecker received a call from Chávez in relation to our papers. He said, “Could Michael look at the paragraph from István Mészáros’s Beyond Capital where Mészáros described capitalism as an organic system of production, distribution and consumption, a system in which everything is connected? If everything is connected, how is it possible to change anything? So, ask Michael to indicate concrete proposals for change in this context.”

Frankly, I was blown away by the question, and my immediate reaction when she passed this message to me was—“What paragraph???” Happily, I had Mészáros’s book with me in Caracas, and so I searched for the paragraph in question. It was not easy, though, to isolate a single section because that is what the whole book is about—the necessity to go beyond all sides of capital if socialism is to be built. Ultimately, I concluded that the paragraph Chávez had in mind was in section 20.3.5 where Mészáros talks about “the inescapable dialectical relationship” between production, distribution, circulation, and consumption, stressing that “the capital relation is made up of many circuits, all intertwined and mutually reinforcing one another.” Here, then, was why Mészáros concluded that “it is inconceivable to achieve the socialist objectives without going beyond capital, i.e. without radically restructuring the totality of existing reproductive relations.”5 And, here was the problem that concerned Chávez and which now concerned me—what concrete measures were possible in this context? That led to the second of these papers for Chávez in December 2006.

Rereading István Mészáros’s Beyond Capital, I am very impressed by the way he goes to the heart of the new society that must be built. It is true that he draws very heavily upon Marx’s discussion in the Grundrisse (and I have often stressed this point); however, what is so remarkable is how sharply he hones Marx’s point. Especially significant is the way he stresses a “twofold tyrannical determination” in capital (to which the market socialist reformers in the USSR were oblivious)—(a) “the authoritarianism of the particular workshops,” and (b) “the tyranny of the totalizing market.”6

Precisely because this double tyranny is so clear for him, Mészáros is unequivocal in identifying as characteristic of the new socialist society that (a) control of production be “fully vested in the producing individuals themselves,” and (b) that “the social character of labour is asserted directly,” not after the fact. In other words, productive activity in this socialism is social not because we produce for each other through a market but because we consciously produce for others. And, it is social not because we are directed to produce those things but because we ourselves as people within society choose to produce for those who need what we can provide.

Here is the core of this new socialism as Mészáros saw it—“the primacy of needs.”7 Our needs as members of society—both as producers and as consumers—are central. This is a society centred on a conscious exchange of activity for communal needs and communal purposes. It is a society of new, rich human beings who develop in the course of producing with others and for others; these are people for whom the desire to possess and the associated need for money (the real need that capitalism produces, Marx noted) wither away. We are describing a new world in which we have our individual needs, needs for our own “all-round development,” but where we are not driven by material incentives to act. It is a world in which our activity is its own reward (and is, indeed, “life’s prime want”) because we affirm ourselves as conscious social beings through that activity, a world in which we produce use-values for others and produce ourselves as part of the human family.

But, obviously, those people do not drop from the sky. They are formed by every aspect of their lives. Not only their activity as producers but also in the spheres of distribution and consumption. In this complex dialectic of production-distribution-consumption, Mészáros stresses, no one part can stand alone—it is necessary radically to restructure the whole of these relations because capitalism is a “structure of society, in which all relations coexist simultaneously and support one another” (Marx). So, how can you make any real changes if you have to change all relations—and you cannot change them all simultaneously?

In the same way that capitalism developed. Capitalism developed through a process, a process of “subordinating all elements of society to itself” and by creating for itself the organs which it lacked. The new socialist society similarly must develop through a process of subordinating all the elements of capitalism and the logic of capital and by a process of inserting its own logic centred in human beings in its place. It proceeds by assembling the elements of a new dialectic of production-distribution-consumption.

Elements of the New Socialism

What are those elements? At the core of this new combination are three characteristics: (a) social ownership of the means of production which is a basis for (b) social production organized by workers in order to (c) satisfy communal needs and communal purposes. Let us consider each in its turn and their combination.

Social ownership of the means of production is critical because it is the only way to ensure that our communal, social productivity is directed to the free development of all rather than used to satisfy the private goals of capitalists, groups of individuals, or state bureaucrats. Social ownership, however, is not the same as state ownership. State property is consistent with state capitalist enterprises, hierarchical statist firms, or firms in which particular groups of workers (rather than society as a whole) capture the major benefits of this state property. Social ownership implies a profound democracy—one in which people function as subjects, both as producers and as members of society.

Production organized by workers builds new relations among producers—relations of cooperation and solidarity; it furthermore allows workers to end “the crippling of body and mind” and the loss of “every atom of freedom, both in bodily and in intellectual activity” (Marx) that comes from the separation of head and hand characteristic of capitalist production. As long as workers are prevented from developing their capacities by combining thinking and doing in the workplace, they remain alienated and fragmented human beings whose enjoyment consists in possessing and consuming things. Further, as long as this production is carried out for their private gain rather than that of society, they look upon others (and, indeed, each other) as means to their own ends and thus remain alienated, fragmented, and crippled. Social production, thus, is a condition for the full development of the producers.

Satisfaction of communal needs and purposes has as its necessary condition a means of identifying and communicating those needs and purposes. Thus, it requires the development of the democratic institutions at every level which can express the needs of society. Production reflects communal needs only with information and decisions which flow from the bottom up. However, in the absence of the transformation of society, the needs transmitted upward are the needs of people formed within capitalism—people who are “in every respect, economically, morally and intellectually, still stamped with the birth marks of the old society” (Marx). Within the new socialist society, the “primacy of needs” is based not upon the individual right to consume things without limit but, rather, upon “the worker’s own need for development”—the needs of people in a society where the free development of each is the condition for the free development of all. In a society like this where our productive activity for others is rewarding in itself and where there is all-round development of individuals, society can place upon its banner: to each according to one’s need for development.

As consideration of these three specific elements suggests, realization of each element depends upon the existence of the other two—precisely Mészáros’s point about the inseparability of this distribution-production-consumption complex. Without production for social needs, no real social property; without social property, no worker decision-making oriented toward society’s needs; without worker decision-making, no transformation of people and their needs. The presence of the defects inherited from the old society in any one element poisons the others. We return to the essential question: how is a transition possible when everything depends upon everything else?

Building Revolutionary Subjects

In order to identify the measures necessary to build this new socialist society, it is absolutely critical to understand Marx’s concept of “revolutionary practice”—the simultaneous changing of circumstances and human activity or self-change. To change a structure in which all relations coexist simultaneously and support one another, you have to do more than try to change a few elements in that structure; you must stress at all times the hub of all these relations—human beings as subjects and products of their own activity.

Every activity in which people engage forms them. Thus, there are two products of every activity—the changing of circumstance or things (e.g., in the production process) and the human product. This second side of production is easily forgotten when talking about structural changes; however, it was not forgotten in the emphasis of the Bolivarian Constitution upon practice and protagonism—in particular, the stress upon participation as “the necessary way of achieving the involvement to ensure their complete development, both individual and collective.”

What is the significance of recognizing this process of producing people explicitly? First, it helps us to understand why changes must occur in all spheres—every moment that people act within old relations is a process of reproducing old ideas and attitudes. Working under hierarchical relations, functioning without the ability to make decisions in the workplace and society, focusing upon self-interest rather than upon solidarity within society—these activities produce people on a daily basis; it is the reproduction of the conservatism of everyday life.

Recognizing this second side also directs us to focus upon the introduction of concrete measures which explicitly take into account the effect of those measures upon human development. Thus, for every step two questions must be asked: (1) how does this change circumstances, and (2) how does this help to produce revolutionary subjects and increase their capacities? There are often several ways to make changes, but the particular battles which will build this new socialism more certainly will be those which not only win new ground, but also produce an army capable of fighting new, successful battles.

Choosing Concrete Steps

When we focus upon human beings and their development, it is easy to see how the elements within the new dialectic of production-distribution-consumption are connected. The process is one of synergy—the effects of changes in the sphere of production will be felt in the spheres of distribution and consumption; thus, this whole is greater than the sum of its individual parts.

Let us consider each of the elements in turn.

Producing for Communal Needs and Communal Purposes

The Bolivarian Revolution has taken a giant leap into the twenty-first century with the creation of the Communal Councils, an essential cell of socialism for the twenty-first century. The communal councils provide a means by which people can identify communal needs democratically and learn that they can do something about these by themselves as a community. In this respect, these new community organizations are a school of socialism—one in which there is simultaneously a changing of circumstance and the development of people, “both individual and collective.”

They are also a base upon which to build. As the councils begin to function successfully, they can take further steps in identifying the needs of the community—what are those needs (both individual and collective) and what are the local resources that can satisfy those needs? For example, the councils can conduct a census of the local cooperatives and other enterprises that could produce for local needs. Further, they could bring together workers and the community to discuss ways to produce for communal needs and purposes.

The communal councils in this respect are a paradigm for this process. Not only are they a vehicle for changing both circumstances and the protagonists themselves but they also move step by step to a deepening of the process. Inevitably, all councils will not develop at the same pace, so uniformity cannot be imposed; however, this unevenness provides an opportunity for more advanced communities to share their experiences (a process which helps to build solidarity among communities). Further, the transmission of their needs upward for participatory budgeting at higher levels is an essential part of the process of developing planning from below for communal needs and purposes.

Of course, not all decisions to satisfy social needs belong at the level of the neighborhood and community. The decisions to reject neoliberalism, to pursue endogenous development, to seek food sovereignty, to create new education and health programmes, to create a new transportation infrastructure, to build new socialist relations—these are decisions which must be made at the national level. So, where is the place for revolutionary practice, the simultaneous changing of circumstances and self-change, in such cases?

There is no automatic place for the protagonism of the people in such state decisions. Perhaps some day a new state which is based upon the communal councils will emerge, and perhaps at some point computers will permit instant referenda on a host of national issues. On such matters at this point, however, the participation from below that allows people to develop their capacities will only occur as the result of a political commitment, one which makes real the Constitution’s understanding that the sovereign people must become not only the object but also the subject of power.

In short, national-level decisions can all be made at the top, which is characteristic of both dictatorships and representative democracies, or there can be a dedicated search for mechanisms which incorporate people below so they not only can affect the nature of the decisions, but also recognize the decisions as theirs. The “parliament of the streets” is an obvious example of a mechanism which can incorporate people into the discussions of laws, improve the quality of information available for good decisions, and create an identification with these decisions. However, finding ways to institutionalize this process so that people view it as their right to participate (and punish National Assembly deputies who do not honor this right) is important both in empowering people and attacking bureaucracy and elitism.

National decisions on such matters as the sectors of the economy that should be expanded and the social investments that need to be made are most critical at a time when the rapid and dramatic transformation of the structure of the economy from an oil economy is desired. And, these decisions have the profoundest effect upon which needs of society can be satisfied in the present and future. The significance of such decisions is precisely why it is important that they be pursued transparently, that the information that people need to be able to understand the logic behind these proposals be circulated in a simple and clear way and that the proposed plans and directions be discussed in advance in assemblies of workers and communities.

Just as in the case of discussions in communal councils and the development of links between the community needs and local producers, the dissemination and discussion of information about nationwide needs and purposes will be important in mobilizing support and initiatives from below in communities and workplaces to meet the needs of society. Sometimes, too, it will prevent serious errors when national initiatives do not take into account local and regional impacts (especially their environmental effects). Thus, not only do these democratic processes disseminate information downward. They also are an essential means of transmitting information upward.

For goals identified at both the community and national levels, the greater the spread of information and discussions through which people take ownership of the decisions, the more likely that productive activity will occur to ensure the successful achievement of those goals (rather than out of self-interest); in this way, producing for communal needs and purposes emerges as common sense.

Social Production Organized by Workers

The preconditions for successful worker organization of production are dissemination of the information necessary to carry out the activity and the ability to use this information efficiently. Thus, transparency (“open books”) and worker education (through a transformation of the traditional workday to include education) should be introduced in state, private capitalist, and cooperative enterprises.

While some aspects of enterprise activity (such as production statistics and information about purchasing decisions) can be monitored by workers relatively easily, examination of financial data and evaluation of management proposals require the development of more skills. Thus, for an interim period, workers should have access to worker auditors and advisors who can serve on their behalf. These specialists could be part of the group of educators assigned to the enterprise or could be provided to the enterprise by the Ministry of Work or by a trade union or trade union federation.

The steps in which workers assume direction of the organization of production should be set out clearly in advance in each enterprise; these steps and the pace pursued will vary in accordance with the history, culture, and experience in each case. While individual cases will vary, one of the first areas where workers can demonstrate the benefits of worker decision-making is through the reorganization of production. With their knowledge of existing waste and inefficiency, workers should be able to improve productivity and reduce costs of production.

To encourage the efficient production of use-values and to deepen the development of social production, the gains from these worker initiatives should not accrue to the enterprise (especially in the case of private capitalist firms!). Rather, in principle, these benefits should be divided up among enterprise workers and the local community following discussions in worker assemblies and the direct coordination of worker representatives with local communal councils. The links between workers and community built upon this basis are then an important part of the creation of these new relations.

In general, the process by which worker decision-making advances in the enterprise should start from the bottom up. Beginning from worker veto over supervisors (on the logic that supervisors unacceptable to workers are inconsistent with any worker management), the degree of worker decision-making would grow on a step-by-step basis. Starting from a phase in which workers identify the profile of acceptable managers and begin discussions of production and investment proposals of managers, the development of knowledge and worker capacities through this process would proceed toward the goal in which workers (including the managers who represent them and society as a whole) organize social production for communal needs and purposes.8

Under ideal circumstances, the steps in this process will be determined through negotiation and agreement between workers and management of enterprises and will be filed with the Ministry of Work as a social contract. Where timely agreement is not possible, enterprise workers can bring the matter to the Ministry of Work for its action (and for referral to the National Assembly in the case of privately owned enterprises).

It should be pointed out that two characteristics often identified with co-management—worker election of top directors and worker ownership shares—play no role in the above discussion. Both measures contain within them the potential for old ideas and familiar patterns to penetrate into the new relations of worker management and to make them simply new forms of the old relations.

As in the case of representative democracy in the political sphere, worker election of enterprise directors has often served to create a separation between those directors and the people they presumably represent. The club of directors develops its own logic, which is one distinct from the interest of workers. In particular, within the contested terrain of capitalist firms, co-management in this form means cooptation—a means of incorporating workers into the project of capitalists. In contrast, the process described here in which workers organize production is one of protagonistic democracy in which workers’ power proceeds from the bottom up and does so for the purpose of serving communal needs.

Similarly, the idea that workers’ interests in enterprises (state-owned or private capitalist) should be secured by giving workers shares of ownership—whether those shares are individually held or owned by a cooperative—is a case where co-management can be deformed into self-oriented private ownership. Instead of workers functioning as socially conscious producers, expressing themselves as cooperating producers and members of society, they are transformed into owners whose principal interest is their own income (which means the economic success of their particular company). This is not the way to build social production—i.e., the exchange of activity based upon communal needs and purposes.

Social Ownership of the Means of Production

Social ownership of the means of production is often presented as a matter of ideology. However, in a society oriented toward “ensuring overall human development” and “developing the creative potential of every human being,” social ownership of the means of production is common sense.

The point of social ownership is to ensure that the accumulated products of the social brain and the social hand are subordinated to the full development of human beings rather than used for private purposes. If the private ownership of the means of production does not support the creation of food sovereignty, endogenous development, and investment that generates good jobs, then the interest of society is advanced by introducing social ownership in its place.

Similarly, if private owners are not prepared to be transparent, to introduce education into the workplace, to accept growing worker decision-making, and to direct their activity increasingly to satisfying communal needs and communal purposes, then they thereby declare that they rank the privileges and prerogatives of private ownership over ensuring overall human development. Where they refuse to support public policies oriented toward creating a society based upon the logic of the human being, they demonstrate that there is no alternative for such a society than social ownership of the means of production.

Thus, it is not the socialist project which excludes them—they exclude themselves by demonstrating that they are incompatible with the full development of human potential.

One month later, on his regular Sunday “teach-in” (Aló Presidente #264 on January 28, 2007), Chávez drew upon the concepts developed in this second paper and introduced (to my excitement as I watched!) what he called the “elementary triangle of socialism”: social property, social production, and satisfaction of social needs (by setting out three points on his desk and explaining each side).9 This was one of many examples of his unique ability to take complex theoretical concepts (most evident in his regular references to Mészáros’s Beyond Capital) and to communicate these to the masses of viewers without a theoretical background.10 With simple commonsense language, Chávez succeeded in grasping the minds of masses, and that was an essential aspect in the combination which was building a path to socialism in his (truncated) lifetime. If we can learn to do that, then Chávez no se va.


  1. An additional paper I prepared, “Year of Total Education” (stressing education within worker-managed enterprises, education through practice, and an educational television station) was expanded upon by Haiman El Troudi (subsequently Minister of Planning and currently Minister of Transport) to add political and ethical education, and this was an inspiration for the program “Moral y Luces” announced in 2007 by Chávez.
  2. In the period before Chávez, managers of the state-owned oil company (PDVSA) succeeded in performing the magical feat of ensuring that revenues of the firm disappeared from Venezuela (and thus as state revenues) and appeared instead on the books of subsidiaries such as off-shore refiners.
  3. In Venezuela, PDVSA was the obvious example of such a “statist” firm. Its revenue was critical for supporting, among other things, state programs such as the social missions.
  4. I subsequently explored the incoherence and dysfunction characteristic of “real socialism” in The Contradictions of ‘Real Socialism’: The Conductor and the Conducted (New York: Monthly Review Press, 2012).
  5. István Mészáros, Beyond Capital (New York: Monthly Review Press, 1995), 823.
  6. Ibid, 974–75, 837.
  7. Ibid, 835.
  8. The idea of “profiles” and of the step-by-step emergence of full worker management was developed in the course of meetings in 2005 between the managers of CADAFE (the major state electrical firm at the time) and FETRAELEC (the electrical workers federation) where Marta Harnecker and I played the role of marriage counselors after a breakdown in the process of “co-management” within the firm. Both sides agreed to this proposal but after management consulted with the Ministry of Oil and Energy, all such discussions of worker management were ended (presumably because they were contrary to the policy of the ministry, whose minister was, and remains, also the president of PDVSA).
  9. A few days earlier, I had incorporated much of the above discussion of socialism as an organic system into a talk (subsequently published as “New Wings for Socialism,” Monthly Review 58, no. 11 [April 2007]: 34–41) at the launch of the Venezuelan edition of my Build it Now: Socialism for the 21st Century (New York: Monthly Review Press, 2006). But there was no mention of a socialist triangle there because that graphic image had yet to be invented by Chávez. Subsequently, though, I drew explicitly upon his concept of the socialist triangle as a way to represent socialism as an organic system—beginning with two books published in Venezuela in 2008 (El Camino al Desarrollo Humano: Capitalismo o Socialismo? and La logica del capital versus la logica del desarrollo humano) and in the essay “The Path to Human Development: Capitalism or Socialism?” (Monthly Review 60, no. 9 [February 2009]: 41–63). This was followed by The Socialist Alternative: Real Human Development (New York: Monthly Review, 2010), where the socialist triangle served as the organizing theme.
  10. Some examples of his discussion of the socialist triangle were incorporated in the video, “Worker’s Control: Theory and Experiences,” which was based on a conference on October 26–27, 2007, organized by the Program on Human Development and Practice of Centro Internacional Miranda; available at http://socialistproject.ca.