Why We Need Economic Democracy

Dada Vedaprajinananda
During the last century people were stirred by slogans such as “making the world safe for democracy” and by demands for “self-determination.” As a result, presently most of the countries of the world now have political democracies and countries that were once colonies of stronger nations are now “free.” Yet despite all of this “democracy” and “freedom” something is amiss and we are by no means living in paradise

What is wrong? Being allowed to vote in an election every few years is the not the be-all or end-all of human aspirations. A person may have the right to vote in an election that will determine who will be the president of his or her country, but that same person may have no voice whatsoever in vital matters concerning his or her economic life. Similarly, countries that have been granted nominal political independence often remain under the economic yoke of their former colonizers.

Political democracy becomes a farce in countries where there is vast economic inequality because wealthy people are able to put their weight behind candidates who will support selfish interests. Political democracy today is not a question of “majority rule” or “one person, one vote” but is simply a game in which the elected government usually reflects the desires of a wealthy minority.

In the 21st Century, simply demanding democracy will not be enough. It is time to make demands for economic democracy and social justice. Economic democracy means that in addition to being able to vote for political leaders, people will also have a right to elect the managing boards and the directors of the enterprises where they are employed and have a say in the economic life of their immediate locality.

How useful is it to be able to vote for the president of your country but not to have any role in choosing the directors of your workplace? Maybe the directors of your workplace are ready to close down your factory or office if it is deemed in the greater interests of stockholders living in a distant locality. Some years back, I remember listening to a BBC broadcast, and it was all about an auto plant in England that was about to be closed by a board of directors located in Frankfurt, Germany. The workers in that plant were able to elect members of parliament, but had no chance to participate in deliberations about the future of their jobs.

In order to bring about economic democracy the structure of economic ownership and organization around the world has to undergo a big change. Today most enterprises in our society are corporations with stockholders. It is a type of absentee ownership. The people who own the shares usually are not the same people who work and live in the communities where the enterprises are located.

If we want economic democracy then we have to reorganize medium and large industries as cooperatives rather than corporations. The owners of the shares would be the people who work in those enterprises, not investors living in other localities. Establishing worker owned and managed cooperatives will be a big step towards economic democracy and expand the scope of human freedom. This kind of change would be truly revolutionary.

Today we hear about various “revolutions.” But in the immediate aftermath of most of these revolutions life goes on as it did before. One government is changed with another. Perhaps the people get a greater role to participate, but economic life remains undemocratic and unchanged. The day has already come, as the Occupy movements show, when the crowds on the street will not be satisfied with this kind of superficial change and will demand their economic as well as political rights.

Copyright The author 2011

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