Associative Democracy

...or European firms, where management continues to exercise its traditional powers and prerogatives...

...I contend that there is, and that it is called associationalism...

...For most SPRING • 1994 • 241 Associative Democracy of this century the role of the nation-state has been strengthened...

...However, they do face a problem in that such intervention has hitherto depended on the state, and nation-states are now much less effective agencies of government...

...Associationalist and English political pluralist ideas can provide models for the emerging forms of governance that have no single authoritative center...

...It appeals to the growing antistatist sentiments among the successful in Western societies, who do not want to be "administered" and who resent taxation to support collectivist welfare...

...The state would not have to cover every contingency as it does when regulating large public and private bureaucracies, over which the members of the public have no direct control...

...They achieve competitive success in two ways...

...To call this SPRING • 1994 • 243 Associative Democracy structure "federal" risks some confusion, given the high degree of centralization in formally federal states like the United States...

...Associations would be publicly funded for functions such as health or education...

...The classic institutions of representative government will be even less effective means of accountability than they are now...

...One must be careful not to turn associationalism into a monolithic ideology...

...Faced with an internationalizing and increasingly volatile economy, in which competition between nations has intensified and growth rates are uncertain, national governments have proved unable to ensure the conditions for prosperity either by traditional Keynesian means or by the monetarist methods that became fashionable in the 1980s...

...it is confined to the state manipulation of macroeconomic aggregates to achieve full employment and economic growth...

...The devolution of social functions to volun tary associations would enable the representative democratic state to become more like a minimal public power again...

...Associationalism has several intellectual sources: the English advocates of industrial and social cooperation, such as Robert Owen and George Jacob Holyoake...

...We can now see that many important problems are international, such as environmental pollution, and they can only be tackled by agencies that operate across the territories of states...

...rather it is a multinational public power that has specific functions in which it takes priority over the member states...

...Thus the laws could be both less extensive and less complex, making them easier to understand and thus promoting the rule of law...

...This is in direct opposition to a longestablished trend toward centralization and state omnicompetence...

...With the end of the cold war the military justifications for the nation-state have weakened too...

...Its aim is a regulated exchange economy that meets social goals through cooperation among economic actors and public agencies...

...Such bodies would need to be legally protected and underwritten by public funds...

...It has little capacity to change the behavior of economic actors by other means...

...A new federalism is the only way forward...

...2. The rejection of the "sovereign" state and the creation of a federal structure of authority based upon cooperation rather than hierarchy is now relevant, because the nation-state is ceasing to be the primary arena for politics...

...The concept of the allocative efficiency of markets is purely theoretical and can provide no guarantee that markets will deliver the outcomes citizens want—full employment, sustained growth, and social stability...

...I contend that the contrary is the case...

...Existing democratic institutions provide low levels of governmental accountability to citizens and of public influence on decision making...

...Even if renewed socialist solutions are not possible, it is obvious that some new form of economic regulation is needed if stability is to be preserved...

...Modern societies are more and more difficult to govern because of this pluralism, and they are less able to overcome value conflicts through majority decision...

...The most successful of these regional economies, like the industrial districts of central Italy, provide models of economic governance based upon public-private cooperation...

...whatever its limitations it allowed citizens to criticize and to change their government...

...the English political pluralists Frederick William Maitland and John Neville Figgis, developing the ideas of Otto von Gierke...

...Associationalists have always supported the federal principle, but one in which the federation is like an association, the component agencies entering into relations of cooperation as necessity requires...

...Surely one body had to set the rules and stand above all others in a given territory...

...The most effective response is to build up local and mutual financial institutions that are non-profit making but offer investors a guaranteed return...

...The state would fund and supervise, but would not be directly responsible for the voluntary self-governing associations that would deliver services in areas like health, education, and welfare...

...But conditions have now changed radically in the advanced Western societies...

...It is, like modern liberalism and communism, a product of that great age of ideologies, the nineteenth century...

...Each group would govern itself for its own purposes...

...Surely such objectives are now irrelevant in the face of economic globalization...

...Liberal democratic theory does not have the resources, without supplementation, to perform these tasks...

...Economic liberalism has provided none of these...

...From the 1930s onward, through national macroeconomic management and redistributionist welfare policies states could ensure economic progress and social security within a market economy...

...Associationalism would enable organizations campaigning for the poor to use public funds to aid poor communities seeking autonomy and reconstruction...

...The present trends toward weakly regulated markets and economic internationalization threaten to create a world that is ungovernable...

...The result was that the institutions of classical liberalism, adequate to superintend a minimal state, were left in place to administer the bureaucratic states of today...

...Associationalism offers ways in which these threats may be sidestepped, without placing too much emphasis on the weakening powers of the central state...

...The crisis over the ratification of the Maastricht Treaty showed popular discontent with technocratic government, but it has set back unification...

...Thus political change in this direction can proceed gradually as conditions dictate...

...We cannot rest content with a stagnant liberalism and the absence of any strategy for reform...

...3. The third proposition concerns the construction of a more decentralized and mutualist economic system...

...The problem is whether we can develop political ideas to make sense of those changes and to guide political action...

...20 No...

...And, through activities that range from collective marketing, to economic intelligence, to pooled R&D, firms gain from their cooperation with others...

...The market was presented as a different form of democracy, based on consumer sovereignty...

...Instead, political actors will be confronted with complex overlapping structures of government and social regulation, both public and private, at international, national, and regional levels...

...Associationalism can be summed up in three basic propositions...

...20 No...

...The scale of direct state activity is reduced, but not at the expense of social provision...

...For the application of associationalist theory to the United States see Joshua Cohen and Joel Rogers, "Secondary Associations and Democratic Governance," Politics and Society Vol...

...Increasingly the public bodies able to perform these tasks are not conventional national states but regional governments...

...A key task of such a new theory will be to find a means of subjecting transnational corporations to some form of public, democratic control...

...The international arena is becoming crowded with such agencies (some are United Nations bodies, some intergovernmental, some part of an international civil society, like Greenpeace or Amnesty), and yet they remain outside the scope of our political theory...

...On the internationalization of politics, see D. Held, "Democracy, the nation-state and the global system," Economy and Society Vol...

...Modern associationalism is not a utopian doctrine, nor would it involve the destruction of all other institutions in order to create a society consistent with its principles...

...Each subcommunity could craft the forms of education, health care, and so on that it desired...

...Welfare states are in crisis throughout the advanced world...

...It would be premature to dismiss such ideas...

...Associationalism failed to have much political influence after the mid-twenties because the political forces on both the left and the right that supported state centralization and collectivism were better adapted to the conditions of the early twentieth century, and in particular the demands of total war...

...It is not the solution to every social problem, nor can associationist institutions be built overnight...

...Cole and Harold J. Laski...

...Some of the most successful manufacturing companies also mimic mutualist relationships: many Japanese firms have contrived a system in which workers are as committed as they might be in a cooperative, treating the company like a community of which they are members...

...Prospects of Democracy, Polity Press, 1993...

...However, these workers have few of the advantages of ownership or control...

...Economic internationalization threatens to centralize economic success in a few nations and regions, de-industrializing other areas and diverting their financial resources away from domestic investment...

...Through the provision of collective services, they reduce the costs to firms of key inputs like trained labor and specialized equipment...

...Re-emphasizing collectivism is thus no answer to the failure of economic liberalism...

...Keynesian policies can at best prevent a slump from accelerating...

...If we consider the three propositions advanced above, we shall see what associationalism has to offer...

...Liberal democracy derived its most powerful legitimation from the threat of ideological dictatorships...

...Liberal democratic politics is stagnant, and economic liberalism is in no better shape...

...The third reason for the stagnation of liberal democracy is that it has been closely tied to the idea that the nation-state is the primary political community...

...Now the political arena is changing radically...

...Democratic control of the economy may be achieved by other routes than the policies of elected national governments, in particular by making companies answerable to a wider range of interests...

...However, it can only succeed in modern conditions if it is not seen as a way of completely supplanting such institutions, but as a way of restoring them to effectiveness by radical but practical reform...

...This threatens both the democratic control of the economy and the living standards of the less successful nations and regions...

...Associationalism is also flexible enough to be adopted by a wide variety of social groups: it 246 • DISSENT Assodative Democracy breaks out of the old left-right political spectrum...

...Unless it is supplemented by other ideas, it will fail to adapt to a changing political world...

...December 1992...

...War mobilization, the growth of welfare, and the regulation and support of big business all promoted the growth of large public and private hierarchical administrations...

...Just as national governments are losing some powers to international agencies, they are also losing economic regulatory functions to subnational units...

...Another way is to help set up mutualist firms that really do create a community at work, with employee ownership and authority...

...Cole, J.N...

...It would allow the affluent to choose the services they please and to use their public entitlements to pay for them, at least in part...

...But liberal democracy is almost moribund, too, something most celebrants of the collapse of communism have failed to notice...

...If social control is to be restored over the economy it will have to be in a new way: the public powers and economic actors need to achieve a new form of coordination, based upon more localized forms of economic governance...

...In those areas wholly subject to the democratic decision of their members it is the members who bear the consequences...

...Yet economic liberalism will rule by default in the absence of a new concept of economic governance...

...In "freeing" the market, economic liberalism actually weakens those relationships...

...Associationalism seeks to combine the individual choice of liberalism with the extensive public provision of collectivism...

...Voluntarism would also make social provision and social governance less conflictual...

...Associationalism thus has the potential to be both practical and popular as a new doctrine of social reform and renewal...

...Lastly, public agencies must promote worker involvement, the major source of high productivity...

...SPRING • 1994 • 245 Associative Democracy The economies of the advanced nations are internationalizing...

...Western societies are also less homogeneous than ever in their values, with ethnic, religious and life-style pluralism far advanced...

...Laski, Routledge, London 1989...

...Associationalism is neither capitalist nor collectivist...

...The third proposition is that as far as possible the economy should be organized on mutualist lines, that is, by means of nonprofit financial institutions and cooperative firms in which both investors and workers have a significant say in their governance...

...Societies will be unable to survive, and even to compete economically, if they just accept whatever results uncontrolled markets and international competitive pressures produce...

...However, the very reasons that led it to lose out to those competitors in the early twentieth century make it a suitable guide to radical renewal in the twenty-first...

...Pierre-Joseph Proudhon and the French mutualists...

...Such claims assumed that "free" markets would produce widespread prosperity because of their superior allocative efficiency...

...The institutions that it has become identified with—national parliaments, political parties, and the majority choices of the citizens of a homogeneous political community—seem less than effective means of organizing the new politics...

...The conflict between liberal democratic capitalism and state socialism dominated political life for most of this century...

...SPRING • 1994 • 247...

...The EC has no armed forces and it has great difficulty agreeing on a common foreign policy...

...The old advocates of associationalism were too ambitious and saw it as a complete replacement for both liberal democracy and socialism...

...State intervention was accepted when the bulk of the population 242 • DISSENT Assedative Democracy were struggling manual workers, but social reforms and rising prosperity have created a society in which the majority perceive themselves to be "middle class" and wish to craft their own consumption of services such as pensions or health care as much as possible...

...2) How to cope with increasingly pluralistic societies with divergent values...

...Liberalism evolved within the context of the sovereign nation-state...

...Keynesianism is too one dimensional as a doctrine of economic governance...

...The well-to-do have become tax averse and less willing to accept the standard services that the state provides...

...In it the livelihood of all but a favored few will be insecure, even in the advanced world, and the major beneficiaries will be major transnational corporations beyond effective political, let alone democratic, control...

...Citizens would choose to join these associations and would have certain entitlements to services, and the associations would receive public funds proportionate to their membership...

...It is thus possible that by the early twenty-first century politics will have no "center...

...aspects of the French and German corporatist traditions, most notably the ideas of Leon Duguit and Emile Durkheim...

...The second proposition is that political authority should be decentralized and perform as few functions as are consistent with its role...

...This doctrine aims to strengthen government in and through civil society...

...There is no such thing as a "market society," for the simple reason that the market is not a society...

...Authoritarian regimes and the revival of religious fanaticism in the third world are too distant from us in the West to have the same effect...

...Different groups and 244 • DISSENT Associative Democracy associations would certainly have to get used to living side by side, each obeying its own rules and leaving others to do the same...

...It is neither a superstate nor is it simply an association of sovereign states...

...The sites of governance are shifting toward the supranational and the regional levels: to trade blocs like the European Community and to regional governments like the German Lander (substates...

...It has the advantage over most economic doctrines in that it relies on the powers of citizens freely linked together in civil associations...

...On English political pluralism, see Paul Hirst (ed...

...Following from that, public agencies must aid and encourage smalland medium-sized firms to overcome their reluctance to cooperate and their tendency to view other firms solely as competitors...

...The great danger with institutions like this is that they will evolve blindly without clear political models, sidestepping the issue of accountability...

...They would enable regions to recycle their own capital—pensions, private savings, and so on—to create work and wealth within the region, rather than seeing both siphoned off halfway across the globe...

...Industrial districts thus simulate the forms of voluntary coordination advocated by the associationalists...

...The first is that the organization of social affairs should as far as possible be transferred from the state to voluntary and democratically self-governing associations...

...In fact the collapse of communism and the stagnation of liberalism are connected...

...Since the early 1970s, however, the effectiveness of national economic management has declined dramatically...

...1. The promotion of self-government through voluntary associations would address three major problems: (1) How to ensure accountability in representative democracies...

...It is a doctrine that was bound in practice to favor the rich and the major corporations, under a cloak of rugged individualist rhetoric...

...it embraces both cooperation and markets...

...And it is less and less evident that large bureaucracies, whether public or private, are efficient and that the public gains enough in competent administration to compensate for its loss of control over its affairs...

...The poor are seen, on the right, as victims of a dependency culture, and, on the left, as disempowered by welfare bureaucracies that deny them control over their affairs...

...There are three main reasons why liberal democratic institutions are failing to cope with the new challenges...

...Consider an entity like the European Community (EC...

...The first goes back to the beginning of this century, when representative democracies embraced big government and interventionist bureaucracy in order to secure their societies against external threats and internal conflicts...

...Is there a political concept that will address all these problems: that can restore the accountability of government, cope with the new complexity of political authority, accommodate the plural values of diverse communities, satisfy the desire of the successful not to be regimented while meeting the needs of the poor, and provide new methods of economic governance...

...Yet, after more than a decade of conservative free market policies, the negative results are obvious for all to see...

...State regulation could be looser and simpler because an association's members would have the power to leave or press for change should any action of that body damage their interests...

...Communities would be free to establish their own services in conformity with their own values, subject of course to certain minimum common standards...

...The institutions of liberal democracy could then function as the agencies of supervision and accountability, unencumbered by direct responsibility for delivering services...

...State socialism is finished as a credible political idea...

...In this doctrine the state ceases to be a central "sovereign" body and the political structure becomes pluralistic as power is shared by a number of agencies...

...2, May 1991...

...The world has not become conflict-free, but Western societies no longer face direct military threats...

...Most other routes either involve grafting Korean- or Japanese-style interventionism onto liberal democratic states, breaking their obligation to be neutral between one citizen or firm and another, or involve strengthening the autocratic powers of company managements...

...One way to do so is through broad-based training...

...Thus environmentalists, feminists, ethnic communities, even conservative religious groups could benefit from an enhanced capacity to regulate their own affairs in civil society...

...It offers a route to economic revival that is consistent with the traditions of Western liberalism...

...If public bodies are now able to intervene effectively in the economy it is in their political capacity, by promoting cooperation between economic actors and by adopting policies that enable firms to create the microeconomic conditions for competitive success...

...The great advantage of the associative principle is that it can be used to a greater or a lesser degree, depending on political willingness to promote voluntarism and cooperation...

...Distinct communities have very different and often conflicting standards...

...The creation of industrial districts and mutualist firms may be a more effective response to international competition than, for example, trying to import Japanese techniques into U.S...

...q For Further Reading For an exposition of associationalism, see Paul Hirst, Associative Democracy, Cambridge, England: Polity Press, 1993 and "Associational Democracy" in David Held (ed...

...Liberal democracy is inadequate precisely because changing political circumstances are making its institutions less and less able to cope...

...The second reason is that representative democracy has atrophied, has become more a means of legitimation of centralized and bureaucratic government than a check upon it, at the very time when the expectations of citizens are rising...

...In a world dominated by states, English pluralism seemed counterintuitive...

...Until the "democracy deficit" is tackled, the Community will lack legitimacy...

...The Pluralist Theory of the State: Selected Writings of G.D.H...

...It is best seen as a supplement to our stagnating political and economic institutions, not as a complete replacement for them...

...Thus, giving a greater role to voluntary associations, decentralization, and pluralizing political authority would help to restore legitimacy to liberal democracy...

...The current tendencies toward increasingly complex legislation lead, on the contrary, to the rule of lawyers and to the alienation of the ordinary citizen...

...Some environmentalists also believe that increased regulation of resource use and tough physical planning by government are necessary if environmental catastrophe is to be averted...

...Given such complex political structures, which will resemble the conflicting sources of authority of the Middle Ages, we will need a new theory of the distribution of power among these entities...

...This means that uniform national services are less acceptable to diverse publics...

...Mass higher education and individuation are creating large demanding publics, who are reluctant to have government intrude into their affairs...

...It returned to popularity at the end of the 1970s because it promised renewed prosperity and greater freedom...

...The effect would be to reduce the role of hierarchical organizations, both public and private, and to promote accountability through the democratic self-government of associations and the devolution of functions to the local level...

...The poor will still only get the minimum entitlements—unless a radical change in attitudes takes place—but they could begin to deal with their own problems in their own way, to gain control of their affairs...

...they can no longer deliver sustained growth...

...States are by no means powerless in economic terms, but they no longer have reliable instruments of macroeconomic management that can sustain growth and full employment...

...Such firms are likely to prove tenacious and efficient...

...Groups and associations would compete nonpolitically, by seeking to win the allegiance of individuals rather than by trying to impose common laws upon all...

...There are committed democratic socialists who believe that the failure of economic liberalism and Keynesianism will create an opening for radical socialist policies...

...thus civil society takes on many of the attributes of the public sphere...

...Markets, it was claimed, can register popular preferences better than political institutions do because they allow individuals directly to choose the goods and services they want...

...Associational voluntarism would address the dissatisfactions of the affluent and the poor...

...Voluntary and democratically self-governing associations could be more loosely supervised than bureaucracies are...

...At the same time the Western public is more and more confused about what government can accomplish and whether voting makes any difference...

...The most serious problems facing Western societies (be they economic, environmental, or social) cannot be tackled primarily at the level of the nation-state...

...It is a mechanism of exchange that is embedded in other social relationships...

...The clashes that now arise over state provision, where each group seeks to get the state to recognize its standards as universal, would thus considerably diminish...

...and the two most important associationalist writers of this century, G.D.H...

...and (3) How to enable the successful to enjoy services that have all the benefits of being collective, without being uniform and compulsory, and without at the same time abandoning the poor...

...Traditional methods of state intervention—protective tariffs, subsidies and regional aid—are unlikely to be effective in responding to such pressures...

...Individuals would be free to leave and to join other associations, and the law would protect such freedoms...

...Figgis, and H.J...