Don’t Call It “Communist”
by Brian Snyder
One of the few benefits of a global quarantine is catching up on movies, and one of the movies I’ve recently caught up on is 2017’s The Death of Stalin. If you have an aversion to vulgar language or death squads you should skip it, but otherwise, watching Steve Buscemi play Nikita Khrushchev is a comical experience you won’t soon forget.
Kruschev and Stalin circa 1936; no steady statesmanship in these deliberations. (CC0 1.0, Eugene Zelenko)
But for our immediate purposes, what the film lays bare is that there is absolutely no relationship between the communism of Stalin and the steady state economy of Herman Daly. That should be unremarkable, given that Daly has sent far fewer people to the Gulag. However, critics of the steady state economy often assume it requires a communist system, or at least a strong-armed strain of socialism. By extension, these critics link Stalinesque society with life in a steady state economy.
But the steady state economy requires neither death squads nor state ownership of the means of production. Instead, the steady state economy assumes a mixed economy with capitalist and socialist elements. There is no government-issued housing and there are no food rations. The steady state economy doesn’t even require single-payer health care. Instead, the creation of a steady state economy would rely primarily on 1) tax changes, 2) state management of natural resources, and 3) fiscal and monetary policy reform. The CASSE website provides a more thorough list, but these three categories of policy changes do much of the heavy lifting toward a steady state, at least in the USA.
Taxes and Income in the Steady State
Taxes are a decidedly non-communist concept, and in the steady state economy they would be raised on high incomes, perhaps to a rate of 80 percent, not seen in the USA since the height of the Cold War. This would reduce the incentive for overconsumption and would be coupled with income redistribution, potentially in the form of a universal income recently made famous by Andrew Yang and contemplated as well in the Steady State Herald. As the top marginal tax rate approaches 100 percent, the practical difference between an income tax and an income limit dissolves. While stringent taxes may seem authoritarian, the taxing of income assumes a distribution of wealth to start with, and therefore a system antithetical to communism.
Other tax reforms in the transition to the steady state include the adoption of Pigouvian taxes to price pollution. Pigouvian taxes are frequently proposed by policymakers to influence firm or individual behavior with minimal regulation, as seen extensively and successfully in the tobacco industry. Most recently, a Pigouvian carbon tax was identified by policymakers across the political spectrum. Thus, we could hardly view Pigouvian taxes as left-wing Marxist policy.
State Regulation Doesn’t Imply Communism
Pigouvian taxes, like those placed on tobacco consumption, are conducive to a steady state economy. (CC0 1.0, Almighty Shilref )
A steady state economy would likely require state ownership— or more precisely management—of natural resources. Such management would be required to set or enforce extraction limits. If it sounds reminiscent of the Politburo, think twice. The fact is that U.S. federal and state policy has long encompassed natural resource management. For example, when an oil or gas company removes resources from public or even private lands, it typically pays severance taxes to the state. Thirty-four states, including most of the largest oil- and gas-producing states, impose severance taxes. Some states impose severance taxes on renewable resources like wind and solar too. Is that communism? Again, the taxing of oil companies is a tell-tale sign of quite the opposite.
In a steady state economy, access to state-owned natural resources may be allocated via market system. There don’t have to be any state-owned firms, and the primary difference between the current system and the steady state is in how and why governments allow access to resources.
For example, already states issue permits for oil and gas drilling. However, they consider factors such as well safety, not the greater good (or bad) of GDP growth. Thus in this case, the steady state economy does not entail a radical change in economic philosophy but a moderate evolution of our thinking about the pros and cons of resource extraction.
Fiscal and Monetary Policy
The steady state economy would require a different approach to the U.S. budget and monetary policy. For example, as Brian Czech called for in drafting Section 2 of the Full and Sustainable Employment Act, the Federal Reserve System should return to fighting inflation and go neutral on growth. The fact that the Fed would not be swept aside by the proletariat should be a clue that the steady state does not require a communist revolution.
Another key policy to facilitate a steady state economy would require the USA to balance the federal budget. When we borrow money to fund U.S. federal spending, we stimulate an economy that is already too big to be environmentally or economically sustainable. Again, fiscal responsibility seems hardly Marxist. Isn’t a balanced budget more closely associated with the right than the left?
Pro-Growth Socialism
What is especially confusing—if not confounding—about the “steady-staters-are-communists” critique is that socialists and communists are notoriously pro-growth! Growth and industrialization were top priorities in the USSR and Maoist China. The Soviet Union had its Five-Year Plans; China had the Great Leap Forward. Contemporary China, a communist polity with capitalist tendencies, has sustained the fastest economic growth in the world for decades. Cold War socialists might have lost the GDP race to the capitalist West, but not for lack of effort.
This is not to say that a socialist steady state economy is impossible. John Bellamy Foster has explored steady-statish ideas from a Marxist perspective, and ironically, some of the recent criticism of steady-state ideas has come from socialists who somehow find steady-state economics “capitalist.” My main point is that socialism is uncorrelated with a steady state economy. You could have a steady-state China or a steady-state USA without changing the ownership structure of the economy in either country.
Why Does It Matter If the Steady State Economy is Socialist, Capitalist, or Mixed?
Mao Zedong pushed for economic growth and mass industrialization—two policies rejected by steady staters. (CC BY 2.0, Manhai)
There is a reason many people are repulsed by the concept of communism, and there is a reason the term “socialist” is used by some on the right as a rhetorical cudgel. As The Death of Stalin points out—in an admittedly satirical manner—the world that Stalin built was a brutal one in which comrades lived in constant fear of murder. Because of that history, in the West and especially in the USA, people cannot propose socialist ideas and expect them to be well received. Stalin stained socialism more than Bill Cosby tainted Jell-O.
But the objection to calling the steady state economy Cold War names isn’t just about marketing. Capitalism, socialism, and communism are systems for allocating resources among users. The steady state economy is less concerned with allocation of resources and more concerned with the rate of extraction of resources. The sustainability of an economic system is a matter of its energy and resource extraction as well as the quantity and types of high-entropy wastes emitted. Those biophysical processes, governed by the second law of thermodynamics, are the principle concern of any steady state economy.
The second law of thermodynamics doesn’t care if you are Karl Marx or Milton Friedman; it doesn’t care who owns resources or how resources are allocated once extracted. The second law only cares about the conversion of energy into entropy. And eventually, everyone obeys the second law, even Stalin.
Brian Snyder is an assistant professor of environmental science at Louisiana State University and CASSE’s LSU Chapter director.
I think that the conventional definition of capitalism is an intentionally deceptive definition. If you have control of the creation of money you can OWN anything, means of production, media, governments and don’t they? In fact If you have control of the creation of money you can even avoid the liabilities of ownership by indebting others to deal with them. I think those of us who want to change the system need focus on the Money Power.
Hi Howard,
I came across this article on the Guardian today, and while I normally like the Guardian’s reporting, this one drove me nuts! I thought you might also like to be driven nuts by it!
https://www.theguardian.com/commentisfree/2020/jul/14/the-guardian-view-on-covid-19-economics-the-austerity-con-of-deficit-hysteria
I agree with “Don’t Call it Communist” as well as with Howard Switzer’s identification of “money power” as a necessary focus.
However, living in a Single Payer health care system (France) where health care is mixed between public and private (not communist) I can testify that the system brings down GDP expenditures for both government and individuals compared to the USA. No one in France has ever needed to declare bankruptcy because of health care debt. And we have the freedom to change jobs without losing our insurance. This extra freedom and economic security allows many people the “luxury” of choosing non-consumerist non-growth lifestyles, such as yours truly. This is my only disagreement with Brian Snyder’s article. Single Payer opens many doors to a steady-state economy. We even have an SOS-Doctors system whereby a doctor will do a home visit (an incredible sense of security in times of coronavirus), which adds much less to the GDP than an ER visit.
Hi Mark,
Thanks for writing! I don’t mean to imply that single-payer health care isn’t a good policy, only that you could have a steady-state economy without it. I actually agree that single-payer is superior to the current system in the U.S.
Hi Mark,
Thanks for writing! I actually agree that single payer is preferred, I was just trying to argue that it isn’t absolutely required for a steady state economy. Of course, single-payer healthcare is also not socialist so it would have fit with the idea of the post. Good point!
Amen! 1) Steady-State IS the Middle Way; and 2) most all developed, democratic countries in the world (including the USA) have had a Mixed Economy for decades & decades. Thus, Steady-State fits right into the mix. Besides, it’s common sense from both an ecological view and an economic view.
Keep up the good work.
Happy Trails,
Scott Haley
https://ecologicalliberalism.blogspot.com/
Thanks Scott!
It is not all that clear that CASSE is not supportive of markets and private profit. For that matter, it may even support economic growth by suggesting reforms that might take forever to achieve steady state. In particular, I would like to know just how population is to be controlled. With full employment and the operation of a market economy, how will the energy budget be brought to steady-state while retaining repositories of fossil fuel at some constant level greater than empty? If the profit seekers continue to seek profits, what is to prevent those who do not share in private profit from getting poorer? If one taxes the profit seekers enough to frustrate their natural instincts toward resource acquisition, they will rebel in their old-fashioned way, namely, by cheating. The workers, who grow poorer year by year and who never wished to be the objects of charity, will rebel in similar ways and in some ways we won’t like. If they don’t grow richer, the owners of businesses will rebel. If they aren’t rich, they must be better off this year than last year, which requires economic growth. How will you deal with inventions that improve productivity by replacing humans with robots for example? These problems can be solved, but not with tax law, extraction control, and banking regulation. It’s like pushing on a string, which ought to sound familiar.
Hi Tom,
Good questions. On the population issue, Herman Daly originally proposed a ‘cap and trade’ like system where everyone got a reproductive allowance that they could use or trade. He noted, however, that such a policy wasn’t critical to the SSE. To your other points, in my opinion, the overarching thing to remember is that policy alone will not yield a SSE. Instead, it also requires an ethical change in what we consider ‘good’. I think this ethical change will be both more difficult and more important than the policy change, but it is necessary because of some of the points you raise about people wanting to be richer this year than last year. Years ago, Daly and Cobb made this point, but I’m also reading Walter Bruggemann’s book “Tenacious Solidarity” which makes a similar point, although without reference to the SSE. So to answer your question, ethical/cultural/religious change must happen in order for any progress towards an SSE to occur. The policy changes are just the result of those ethical changes, and the point of this essay was just to argue that those policy changes aren’t that radical.
Brian S. wrote:
So to answer your question, ethical/cultural/religious change must happen in order for any progress towards an SSE to occur. The policy changes are just the result of those ethical changes, and the point of this essay was just to argue that those policy changes aren’t that radical.
If we had to wait for ethical change to occur, I would begin to suspect once again that CASSE is interested only in delaying economic change; but, that’s not how this is playing out. The economy looks like it has ceased to grow. We have been fooled before, but growth must be near the end of its time.
Then, David Delaney’s four factors predict the end of capitalism: https://www.dematerialism.net/delaney1.html
What will come in its place? If markets persi0st
So George Bernard Shaw’s observation is even more dire inasmuch as one person becoming richer must be accompanied by one or more people getting poorer.
What is to be done with that section of the possessors of specific talents whose talent is for moneymaking? History and daily experience teach us that if the world does not devise some plan of ruling them, they will rule the world. Now it is not desirable that they should rule the world; for the secret of moneymaking is to care for nothing else and to work at nothing else; and as the world’s welfare depends on operations by which no individual can make money, whilst its ruin … is enormously profitable to moneymakers, the supremacy of the moneymaker is the destruction of the State. A society which depends on the incentive of private profit is doomed.– George Bernard Shaw, The Millionairess.
Finally, Jay Hanson said, “If you can’t fix government, you can’t fix anything.” So, perhaps someone (Brian C.?) who knows how should establish a democratic fractal government without power based upon sortition so that, when the chaos exceeds a certain level after the present government collapses, the people will ask you to set up a government with power.
Change “If markets persi0st” to “If markets persist: feudalism.”
* We need articles like this for literate people.
* However for most Americans–socialism and communism are not “tainted by Stalin”–but “whatever is not done in America.”
* Bernie Sanders will be a milestone. But in the short term, he basically says socialist is no different from liberal. Which many Americans believe anyway.
* Our most ardent anti-communists are so-called Christians. Who need to learn that every encyclopedia says communism was invented Christians. Because in Acts, God struck down those who did not share 100%. (Not 10%.) And Jesus practiced free medical care.
* A black president is automatically a socialist, a Muslim and a radical Christian–all at once. But a white billionaire who quotes Stalin, calling any critic an “enemy of the people”–and has only praise for KGB Putin–receives no stigma.
* Right-wing anti-corporatists believe large corporations stifle free trade. Essentially what many leftists believe. But so long as they make it clear they are right and white, they are OK.
* So let us not over-think. The alley cat that was in the alley first always has the moral high ground.
* I am a “consumerist.” Here are my definitions.
Caitalist: management-owned, rich people rule.
Communism or socialism: worker-owned.
Consumerism: consumer-owned.
I.e. I promote the very radical idea that the people who pay for everything should be considered part owners of everything.
Currently, we do have what are called “consumer coops.” But they are really worker-owned or investor-owned.
Someday I predict a radical change. Everyone who walks in the door of a coop or a Walmart or any store and buys something will be considered an owner. That is consumer-owned.
Quite a clear difference, I think.
This will evolve simply: if a businessman has a billion dollars–but does not spend a billion to help the customers from whom his money came–customers should go elsewhere.
Nonetheless, this does not stop most Americans from barely listening and then calling this communism.
I know people who call themselves ‘ecosocialists’, ‘solar communitsts’, ‘socialists’ and some ‘anarchists’. (i call myself a ‘stochastic’. i follo0w the path of a nonlinear fokker-planck equation.) i prefer Elinor Ostrom’s ‘commons’ as opposed to the ‘state’. (her variant was different than Garret Hardin’s tragedy of the commons’–hardin’s verson was called ‘enclosures’ from ireland’. https://arxiv.org/abs/2004.11124 .